Bootstrapping from Ukraine: BPMOnline CEO Katherine Kostereva (Part 3)

Sramana Mitra: What did you need to do in terms of sales and marketing? Precisely, what were the hires assigned to do?

Katherine Kostereva: Since the beginning of the company, we invested heavily into both inbound and outbound marketing. We always had sales development. In 2003, we managed to do it just through cold calls. It doesn’t work nowadays. We use completely different tools for the outbound campaigns. When we started, I was making cold calls as well.

Sramana Mitra: You were actually calling people to sell $10 a month solution.

Katherine Kostereva: I was calling people to find the opportunity, then I’d visiting people to sell them the product for as many users as they have. One of my first customers during the first month was an advertising agency. They had 70 people on board. For me that was a huge deal because I earned close to $10,000 in the first month. We sold license per user.

Sramana Mitra: These five customers that you got the first month, can you talk about the deal sizes?

Katherine Kostereva: Our approximate deal size during the first year was from $5,000 to $10,000 per deal. Our revenue during the first year of operations was about $200,000.

Sramana Mitra: When you were closing these $5,000 to $10,000 deals, were they paying on a monthly basis?

Katherine Kostereva: No, lump sum.

Sramana Mitra: That’s very good because that’s really helpful from a cash flow point of view.

Katherine Kostereva: Right. Absolutely.

Sramana Mitra: $200,000 in the first year. This is 2003 or 2004?

Katherine Kostereva: 2003. This is our first year.

Sramana Mitra: Then what happens after that?

Katherine Kostereva: During the first few years of the company, we were doubling revenue. This is our 14th year. We didn’t have a single year without growth, even when we had market issues and even some war issues in Eastern Europe. The growth rates were different. In the first year, it was 2.5x. Then we doubled for several years and a bit less the succeeding years but not lower than 30%.

Sramana Mitra: During the years that you were growing, what was the primary customer acquisition strategy? Did that remain this kind of calling and visiting mode?

Katherine Kostereva: I split the lifecycle of BPMOnline into two parts. The first part is until January 2015. That was our first part of growth. We’ve been growing in our domestic market because the company, during this period, was growing fast but it was growing within our local geographic markets. No one knew the brand of BPMOnline in the United States or in Australia.

Geographically, we were focused on our domestic market. In this domestic market, as we are the first few CRM market evangelists, we did a huge job related to the evangelist’s job like spreading the word on CRM. Everyone knows us in the market. It’s a huge brand locally. We heard feedback from our customers and partners who had offices in America and Asia. They asked why we’re not expanding the business outside of Europe.

This segment is part 3 in the series : Bootstrapping from Ukraine: BPMOnline CEO Katherine Kostereva
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