Identifying Customer Pain Through Consulting Services: Tealium Co-Founder & President, Ali Behnam (Part 3)

Sramana Mitra: You wanted to make the switch to a product company with a hypothesis that this is what you think is needed in the market. You wanted to switch off your consulting business and turn it into a product company in 2011?

Ali Behnam: A big part of the product that we had built was taking all the different use cases that we were solving for our customers. Different customers have different use cases. Through our engagement with various customers, we had seen a lot of different use cases that we needed to satisfy for our product to function properly. We wanted to make sure that the first iteration of the product could actually satisfy a lot of those use cases because those were the common problems that we were seeing among many customers – not just the ones that we were consulting. Thanks to our consulting background, we were able to see so many problems that prospects face and we ended up building up a product that could satisfy those use cases.

Sramana Mitra: In 2011 when you had this deep understanding of the market, what was your revenue level from the consulting business?

Ali Behnam: By 2011, we had pretty much cut consulting. We ended up taking a big pay cut because we were not relying on consulting revenue. Early 2011 was when we actually had a first prototype of the product. Because we didn’t necessarily have the revenue to satisfy the growth and the demand that we were seeing, we wanted to bring in some talent into the house. We ended up raising a very small round of financing from Jeff Lunsford.

Sramana Mitra: The consulting revenue that you produced for three years before that, was that enough to give you some ability to develop the product?

Ali Behnam: It was enough to take us all the way till 2011 when we had the product. It was enough to build the prototype but it wasn’t enough to get us to the next level, which was hiring additional people.

Sramana Mitra: Who’s we?

Ali Behnam: Mike Anderson and me – the two co-founders.

Sramana Mitra: Did you raise the seed money in the San Diego area then?

Ali Behnam: We raised the seed money in April of 2011 and it was through Jeff Lunsford who’s today our CEO. We had met with Jeff earlier on and he said, “This sounds interesting. If you can prove that you can get customers, I would actually like to make an investment myself.” Within three to four months later, we had five customers under our belt. Jeff really got excited and he decided to give us a quick round of financing. The purpose of that financing was for us to hire some professional salespeople. We ended up hiring our VP of Sales at that time and that was the genesis for the company taking off.

This segment is part 3 in the series : Identifying Customer Pain Through Consulting Services: Tealium Co-Founder & President, Ali Behnam
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