Bootstrapping to $5 Million: IdeaScale CEO Robert Hoehn (Part 3)

Sramana Mitra: At what point did you make the next major strategic move and at what scale were you at that point?

Robert Hoehn: Around late 2008, we were getting a lot of requests for the idea of having a comment in a survey that could be displayed to other survey respondents and they  could vote on those comments. The idea of having a qualitative question turned into quantitative through votes. That was in the early days of Reddit.

People were voting on each other’s comments. We got the idea of taking it to the extreme. We’ll create communities within large enterprise organisations where people can give feedback. We pushed it even further and said, “This needs to be a separate company. Let’s split this off into its own thing and let it run.”

Sramana Mitra: When was this happening?

Robert Hoehn: That was late 2008 when Obama came into office.

Sramana Mitra: What scale was the original company at that point?

Robert Hoehn: I think QuestionPro was at $2 million.

Sramana Mitra: How did you manage this bifurcation? It seems like you’ve kept both companies and then IdeaScale was spun out.

Robert Hoehn: IdeaScale was spun out and I became the CEO.

Sramana Mitra: What happened to QuestionPro?

Robert Hoehn: It’s still there.

Sramana Mitra: Who’s running that?

Robert Hoehn: Vivek, my colleague.

Sramana Mitra: Where is QuestionPro now? It’s been eight years.

Robert Hoehn: It’s still growing at about 10% to 20% or so.

Sramana Mitra: It remains a bootstrapped company that you guys own?

Robert Hoehn: I actually took my equity and moved it to IdeaScale.

Sramana Mitra: So you took your equity and put it in Ideascale, and Vivek made QuestionPro his venture.

Robert Hoehn: That’s right. It wasn’t really a breakup but it was like, “We need to focus on these few things.”

Sramana Mitra: Tell me more about the beginnings of Ideascale?

Robert Hoehn: We got in touch with the Obama administration. When Obama came into office, he wanted to set a new direction for all the major agencies to be more open with their constituents. He started this open government initiative. He asked a few software vendors to build something to help agencies have more open-ended feedback.

Using a crowdsourcing tool to solicit ideas from constituents was one of those options in the toolkit. At the same time, what was really interesting is that the Obama administration wanted all the agencies to embrace social media. A woman named Bev Godwin at the GSA actually reached out to all the major players in the social media space and negotiated streamlined terms of service.

If you look at the previous administration, there was no use of social media. One of the largest reasons was because of legal issues. For instance, a great example is, “I’m the White House. I want to use YouTube but the way Terms of Service are structured now is you can have ads on the White House YouTube channel.” Things like that were hammered out. All of a sudden, agencies were using all types of social media. IdeaScale was lumped in there.

It was a huge challenge. It really kicked our butts. It forced us to come up with that MVP quickly. Most importantly, which has been of great value to this day, we learned how to not only sell to government, but also meet all those security standards that all these agencies expect to see. What happened was within six months, all the major 23 federal agencies launched some type of IdeaScale community to reach out to their constituents.

This segment is part 3 in the series : Bootstrapping to $5 Million: IdeaScale CEO Robert Hoehn
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