Building a Marketing Software Company from Utah: Convirza CEO Jason Wells (Part 6)

Sramana Mitra: $3 million was raised from whom?

Jason Wells: They are a private investment group out of New York. They’re not a traditional venture capital firm. They’re more of a Warren Buffet type of an organization, which makes about one or two investments a year in public companies. They didn’t have a portfolio for us. This was really individual money plus a little fund that they put together. They would always tell us, “We don’t really make these kinds of investments, but we like what you’re doing. We like you guys. We’re not going to give you a lot of advice because we really don’t know your space but we think you have a great concept.”

When we did our funding press release, they asked us not mention them. They said, “We do not have a website. We do not want people soliciting investments from us. We make these choices.” We’ve kept that private at their request.

Sramana Mitra: What happens after the $3 million raise and you have a hypothesis that you were going to be execute on? It sounds like that became the business. Tell me more of the milestones of what happened after that.

Jason Wells: The first thing we set out to do was hire a couple of key individuals – a senior technical person and a senior product and marketing person. We started putting together a team to build the product because we were just prototyping it. We raised the money in 2010 and in 2011, we built a prototype. It was more of a production product that we began selling. Very quickly, we got something out of the gates.

Our philosophy has very much been, “Get a product out and then learn from the clients that are buying and using the product.” I wasn’t aware of the lean startup methodology at that time. When you’re careful with your money, you try to get something out that can make money as quickly as possible. At least, that was our philosophy. Two things happened. One was we made some money. Two was we learned what the customers want. That’s what we did with the first generation of Convirza, which we called LogMyCalls. We continued to build. That was iteration number one. It was at that point when we said, “Now, we need to rebuild this from scratch – new platform, new database. Let’s use our product manager. Let’s do more customer research and interviews along the way.”

Sramana Mitra: What did you learn from launching LogMyCalls? What was the functionality in LogMyCalls and what was the market looking for? Where was the gap in the product-market fit?

Jason Wells: In our first iteration, we used our existing small number of clients to listen to them. What we found is that, in the market, people wanted to get their calls recorded. There’s this market of call tracking. At that time, we were just at the beginning of local businesses moving from Yellow Pages to online advertising and understanding the basics like number of calls you’re getting or are my people handling these calls well.

Sramana Mitra: You tied the calls to certain advertising campaigns and tracked what calls were being generated by which campaign?

Jason Wells: Yes, exactly.

Sramana Mitra: That’s what you went to market with. What was the gap?

Jason Wells: Here’s what they wanted. It wasn’t being provided by anyone in the market. There were people who were doing highly manual call recording and then there were people doing this basic call tracking, but nobody was connecting those two together. For the client spending money on marketing, the question was how well were they converting that into sales. To have humans listen to those calls to tell them was very expensive. That was the gap that they wanted to fill.

When we did it for sales training with humans, we did only two calls a month per employee. They wanted to know what’s going on all around, not just the sampling. They needed to understand it better. When we launched LogMyCalls, we didn’t really solve that yet. What we did was automate a way or make it simpler to score, tag, and to comment on calls. We blended two business problems into one application. One was marketing attribution and advertising attribution for phone calls. The other was sales performance or employee phone performance. We made some mistakes there. We learned, in the next year, that those are actually two different buyers. Sometimes, they’re one. Sometimes, it’s just the marketing. They don’t want the complexity.

Sramana Mitra: Marketing and sales are two different departments. They buy software or they buy technology differently.

Jason Wells: Exactly. We built a software that did both because we believed, perhaps naively, that marketing and sales should be working together.

This segment is part 6 in the series : Building a Marketing Software Company from Utah: Convirza CEO Jason Wells
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