Navigating Through Multiple Pivots: Convercent CEO Patrick Quinlan (Part 4)

Sramana Mitra: What was it about your background that gave you any affinity towards that industry?

Patrick Quinlan: I wish I had a great answer to that, but I don’t. I love to eat out with my wife. We have a very funny way of going out to dinner. We get in a car. We pull out of the driveway. If we go left on the street called Cofax, there’s a bunch of immigrant non-US food joints. If you go right, you go to the cool bistros, farm-raised stuff, two blocks down that street. Once we decide right or left, we just go somewhere.

Even when we’re in different cities, we just walk in places. Where I’ve ended up in my companies is very much that same thing. My partner and I are very good at taking tiny ideas and blowing them up into global companies. We found this little company that was in the ethics space and we turned it into something we’re proud of. We didn’t know when we left the house if we were going to have bistro or street food.

Sramana Mitra: I want to spend some time on your current company. Summarize for me the home building software company. Is it something that you bootstrapped or raised money for? You were doing it out of Denver?

Patrick Quinlan: Yes. The first one was bootstrapped initially and then we got some high net-worth investors here in Denver. I found some good investors that walked me through it. We raised $5 million. That company ended up losing everything. We had to lay off all the employees in one day. It was horrible. We used the last couple of hundred dollars in our bank account to shred all of our customer information. That was painful. My parents actually made a montage payment for me. I had to start over. This was the fall of 2008.

It was not an easy time to pick yourself up. I ended up at a smaller consulting firm in Denver. That consulting firm had a client called Rivet Software. That company was doing a million dollars in revenue a year. This was in early 2009. They hired me to come in for 90 days to help put together a leadership plan. This guy had invested $12 million into the company and it was doing $1 million a year.

There was a government mandate requiring publicly-traded companies to use software like this. There were four companies in the world that had this software, with this one being the least developed by far. One of them was actually a public company. I came into the organization. I was a consultant for 90 days. Eight quarters later, we did $15 million in quarterly revenue. We went from zero to $60 million in revenue. There were 12 employees when I walked in the door. We had 700 when I left.

Sramana Mitra: We need a step-by-step narration. What was the business? What was the status of the business? What were the first few things that you did when you walked in?

Patrick Quinlan: I put together a business plan. They were all engineers and had two customer service people. They were trying to sell software to publicly-traded companies to meet this government mandate. The owner didn’t know how to sell. He was an engineer. He wrote a good portion of the code himself. I came in and sat down and understood what this government mandate was. This was in 2009.

It required that in the summer of 2010, all companies over $5 billion had to do this for the first time. In 2011, all publicly-traded companies under $5 billion in assets had to then meet the mandate as well. I put together a sales plan. There was about $400,000 in the bank. I hired nine sales guys. I’ve always said the only reason we were successful is because there was this huge recession. Every time we needed to hire people, there’d be a line out the front door. We hired software sales people. I had enough money to pay people for 90 days. You knew who the buyer was. We never actually had a marketing team.

We got on the phone and we told people that it was $75,000 a year if you did it per year, or $150,000 a year if you did it for three years and paid me upfront. We sold enough of those things to not run out of money. I knew we needed a partnership. This was the only thing that made it all work. The direct sales got us through the first six months.

This segment is part 4 in the series : Navigating Through Multiple Pivots: Convercent CEO Patrick Quinlan
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