Bootstrapping in Minnesota: Praful Saklani, CEO of Pramata (Part 6)

Sramana Mitra: How did you find these angels? What was the logic of these angels being in this company?

Praful Saklani: Among the people that we brought on as early angels, one was the former CEO of SAP America. He’s actually listed on our website as an advisor. He was involved from a very early stage in the company. With his knowledge in enterprise software, he said, “This is a gap. I know that there’s a big need for this.” Through our networks and the network of the people that we brought on as angels, we have many people with CFO backgrounds and a couple of people with COO backgrounds. All of them have wrestled with this problem in their careers. That was really the criteria—finding people who were passionate about the business and leveraging our networks.

Sramana Mitra: I’m surprised that I didn’t hear any lawyer in that group.

Praful Saklani: We do have many lawyers who have invested. This is one of the counter-intuitive things that entrepreneurs should always listen for. If I were to tell you information on contracts, if we were in the same boat in 2006, we would have said, “This is going to be most relevant to lawyers.” What we found out over time is the people who needed this were not just lawyers but people from finance background, sales background, which is what we’ll get into in the modern Pramata. This lack of understanding or blockage of understanding wasn’t just about the lawyers. That’s why I think a lot of the non-lawyers were also very excited about it.

Sramana Mitra: It sounds like the whole thing was angel-financed all along. How far do we go with that model and what else is interesting and strategic in the development of the company? You said you raised angel money from a second set of angels in 2010. What are the highlights or milestones in 2011 or 2012?

Praful Saklani: The company’s principle around fundraising was always simple, which was that we run the core business with high gross margin and positive cash flow. When we raised funding, it was always either to scale sales and marketing or to test out a new thing. We’ve always had the principle of running the core business with the mindset that it needs to be a healthy business, which the bootstrapped model is very aligned with. Oftentimes, some entrepreneurs miss that because they’re just thinking of market share.

As we got through the recession and we started to see buying conditions improving, what we were seeing from our customers was a lot of interest in using our information not just from a legal and finance mindset but to drive some sales outcomes. For your most complex relationships, all the people who touch your customers need to understand these fundamental questions everyday of what’s been solved, what were the pricing levels, and any unique commitments. Within our existing customer base, we started to get a lot of interest infusing our intelligence from our solution to drive those objectives.

Over the course of 2012 and 2013, we started to work in that context of informing those customer-focused teams. We did it in the M&A context. When companies buy another company, they need to quickly understand a variety of customer relationships. Cisco was one of the companies that we’ve worked with in that regard. We helped them with their M&A integration steps. Then, we also started to work directly in arming sales teams through their CRM systems with these customer details that, traditionally, have been very difficult to accurately and reliably move out in the field. There’s a great case study on our website for the work we’ve done with Century Link. They’re a huge telecom company. This has really been a very positive initiative for them to drive outcome in their sales organizations. It’s an interesting story of how you start off with a capability built around one area but you realize that the value from that radiates to audiences that you may have not originally contemplated.

This segment is part 6 in the series : Bootstrapping in Minnesota: Praful Saklani, CEO of Pramata
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