Building a Global Enterprise Software Company from Europe: Gero Decker, CEO of Signavio (Part 5)

Sramana Mitra: The next thing I would ask you is what was the process of fundraising? Were you fundraising in Germany? Where did you go out to raise money and what was the thinking?

Gero Decker: We started getting inbound requests from investors pretty early on. We also got acquisition requests pretty early on, but we didn’t really entertain that. It became overwhelming in 2015. We had a feeling that everybody was reaching out to us. We didn’t need funding because we were profitable the whole time.

Sramana Mitra: You had a lot of revenue.

Gero Decker: We didn’t need funding to fuel the growth, but we realized two things in early 2015. One was, one of our co-founders couldn’t do it anymore. He needed a way to exit. He sold his share. The other trigger point for us was, at that time, we were 60 to 70 people in the company, but we didn’t have a clue about how the company would operate at 200 or 500 people. Nobody had ever done that before. Nobody had gone through that before. Everybody came fresh out of college.

These were the two triggers for us. We needed a way to provide liquidity to one of the co-founders and at the same time, get a partner on board to help us get to the next level of growth and help us through that process. We had 30 management presentations. We had a dozen terms sheets. We went through due diligence with three of them and finally signed with Summit. It was a pretty structured well-orchestrated process over the course of 2015, which ended up with a good result for everybody.

Sramana Mitra: How much money did you raise?

Gero Decker: We raised €31 million.

Sramana Mitra: How much of that went into giving some founder liquidity versus capital?

Gero Decker: The bigger portion was secondary and the smaller portion was primary.

Sramana Mitra: This was in 2015?

Gero Decker: Yes.

Sramana Mitra: What happens next? After you finish this round of funding, one of your co-founders has left. You are a robust company at this point. What happened next?

Gero Decker: One thing that we wanted to do was to professionalize the company. We took quite a number of senior leaders on board. These were people who had worked for other cloud companies before and could really help build a scalable business. As part of that, we completely rebooted our initiatives in the US. We had two or three colleagues since 2012 already in the United States serving US customers. That didn’t take off as we had hoped. One of the experienced guys we took on board was our SVP of Sales for North America who built a team in Boston. From one month to the next, we were up from three people to 20 people.

Sramana Mitra: Are you all in Europe?

Gero Decker: No, we have a good global distribution in 2011. Our first customer in the US was the Department of Defense. They were using a German cloud-hosted service which required us to go through all kinds of scrutiny.

Sramana Mitra: What kind of a sales model did you put together with the funding?

Gero Decker: When we rebooted the US, we didn’t have enough inbound channels to feed everyone. We started experimenting with more targeted approaches. For the first time, we defined the ideal customer profile – whether the people really fall into our target group. This is something that we had not done before because if you have an inbound-only model, you take what comes at you. We had to go through that exercise for the first time and relate it back to the tangible challenges that people were facing.

We basically started a mix of three different components. One is the inbound channel, which is still strong. We added a second channel for active outreach to look at the accounts that we can and should serve. The third was to structurally build up a referral system to work with service providers across the country who are engaged in relevant projects.

Sramana Mitra: This came together in 2016?

Gero Decker: It’s a process. 2016 to 2017 were transformational years for us.

This segment is part 5 in the series : Building a Global Enterprise Software Company from Europe: Gero Decker, CEO of Signavio
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