We recently hit something of a milestone, in that we signed up our 1,000th paying company on Cascade - our strategy execution software platform. It's taken us 5 years and we've made plenty of mistakes along the way (more on that later). We've also done a few things right - and that's the subject of part 1 of this mini-series. I wanted to reflect on the 4 best decisions we've made in our journey so far. In part 2 next week, I'll be sharing our 4 worst mistakes, and trust me, it's going to be painful. After that, we'll be heading into the unknown and talking about our biggest challenges yet to come. Here's the series in full:
- Part 1: The Best Decisions We've Made Along The Way
- Part 2: The Biggest Things We Got Wrong
- Part 3: The Challenges That Lay Ahead
Before I get into the detail, I thought I'd share a bit more color about who these 1,000 companies actually are. They're a mixed bunch, to say the least, including a host of famous brands from the Fortune 500, through to tiny startups in as far-away places as Mongolia, Rwanda, The Solomon Islands, Mozambique and 66 more countries beyond that. They speak dozens of different languages and their business cultures are as diverse as you can possibly imagine. But that one thing they have in common is a commitment to taking their strategy beyond a pretty PowerPoint or an energetic corporate lunch. If you want to learn a bit more about them, check out our video testimonials.
Ok, here goes with what I consider to be the best strategic decisions we've made on our 5-year journey to date:
1. Total Commitment to Inbound (Content) Marketing
We started Cascade without any kind of real financial investment - indeed to date we haven't taken on any investors or capital of any kind. At first, we planned to sell our platform to large enterprise-scale organizations each paying 6-figure dollar amounts for annual recurring subscriptions. We planned to sell to them via our networks, by going to conferences and by word-of-mouth. That strategy.......didn't work. It took us 6 months to sign our first client, then another 6 months to sign the second. At that rate, we would have been over 500 years old before getting to our 1,000th client! Things had to change.
There were a few business blogs that we followed (including the excellent, now defunct GrooveHQ Blog documenting their journey to building a $10m recurring revenue SaaS company) - and to cut a long story short, we decided to try our hand at blogging. I wrote a post several years back on this decision and the immediate fruits it delivered. But the truth is, this was a seriously scary decision - here's why:
The general consensus at the time was that blogs 'could' work for B2B companies trying to reach a large audience of influencers. But that it would absolutely not work as a substitute for traditional enterprise sales. You know the type of sales I'm talking about - one year sales cycles with 360-degree selling that eventually results in big money deals, but takes a long, long time. This was scary for us, because for our business model to work, we needed at least a few of these enterprise sized deals. But the truth was, we had no choice but to commit to inbound marketing. With no funds and an exhausted personal network, it was that or give up.
So we went all-in and started writing a weekly blog post. Most of the early ones were pretty bad - we sounded like cheap self-help gurus with no actual success of our own to talk about - so instead we'd talk about strategy 'theories' and 'principles' that had little grounding in the day to day reality of running a business. But thankfully, a few of the posts seemed to hit the mark. Our post on how to write a vision statement has been sitting at the top of Google's rankings for nearly 4 years now, which is incredible and has been a huge driver of our growth to date.
So the volume came, but we still weren't certain about the quality of the leads we'd get. Those fears were finally put to rest on a deployment I ran of our platform for Mercedes Benz in South Africa. I'd flown over to help them deploy the platform, and I spent quite a bit of time with their CEO. I asked him how he found Cascade in the first place and he replied that one Sunday night, he'd been at home talking to his wife about his ideas for how to get their new 5-year strategy off the ground. A few glasses of wine later, with midnight closing in fast, he was googling 'how to engage people with strategy' (or something similar) and found one of our blog posts on the subject. Fast-forward 3 months, and here we were deploying Cascade into one of the world's best known brands across hundreds of managers.
I knew from that moment onward that inbound content marketing could be anything we wanted it to be, and we haven't looked back since (well, almost - but more about that next week).
2. Growing Into Our Goals
Or, as you could also put it - fake it until you make it. This was actually a strategy I used to use in the corporate world when I was chasing promotions. I'd decide that I wanted the role of 'Head of Credit Cards' and rather than ask for it, I'd pretty much just start pretending that I'd already been given it. It's a simple thing, and I'm sure nothing very original - but I was amazed by how quickly people would forget that you weren't actually the Head of Credit Cards, and just start treating you like you were - until finally the day would come where you got the promotion...and of course nothing really changed.
We've applied the same approach to creating our startup. Here's an example of how we implemented this strategy to help us grow just a little quicker:
We built a network architecture to support thousands of clients, even though we only had 1.
One of the bits of advice you hear time-and-again in the early stages of starting a company is to build your MVP -' minimum viable proposition'. This basically involves creating something and putting it out there as fast as possible to get fast feedback about whether it will fly or fall, then iterate. Also to avoid wasting time on creating something on a flawed premise which you're only going to change a few months later. Don't get me wrong, that's actually sound advice in many cases. But as tech-minded people, the thought of building out a sub-par network architecture would have killed us. So instead we spent the time to create something awesome - even though it wasn't utilized until years later to its full extent. But knowing we had it, knowing we were ready for the scale we wanted gave us the confidence to pitch for huge deals and go toe-to-toe against massive IT providers like SAP and SalesForce.
We applied the same approach to a bunch of other things in the 'enterprise-ready' space.
- We had incredibly detailed contracts and SLAs in place - even though we only had a few clients.
- We launched a partner program for resellers of our platform, even though at the time, we'd only managed to sell a handful of licenses with all our best efforts.
- We opened 3 different global offices (Sydney, Seoul and Portland), even though we barely had the staff to run 1 office properly.
I'll be honest, there were times when I felt like a bit of fool - running a multinational company with 6 staff and a scattering of clients. But we knew this was the company we wanted to be, so we acted like it anyway. And now that we actually are that company, it feels like the most natural thing in the world. We've avoided many of the growing pains that fast-growing startups go through such as having to rapidly scale their architecture.
You can't take this approach for everything that you do - but my advice would be to pick the handful of things that you're most passionate about, and be the company you want to be, years ahead of actually getting there. You might just find that it helps you actually get there much much sooner.
3. Getting Our Hands Dirty
We're pretty stingy here at Cascade. We hate paying for things - whether it's someone to do our electrical wiring, or a marketing agency to overhaul our website. We've pretty much never paid a third-party for any kind of service (fundamentals like legal advice aside). We also never outsourced a single line of code for our platform. Every single character has been written by a full-time employee based either in Sydney or Seoul. I think in truth this didn't start out as a business strategy at all, but rather a necessity of our financial situation (are you detecting a theme here yet?...) But over the years it's evolved into a kind of pride-driven ethos that we 'do things ourselves'. There are dangers to that, which I'll get to in a moment, but there are also huge benefits:
- You're as close as you can possibly be to your failures and successes
If something goes wrong, there's literally no-one you can blame but yourself. That helps keep you honest, and it stops you from making excuses.
- You get to fail fast and figure it out as you go
It's not that I think my web-design skills are better than a marketing agency (they're not) - but the thing is, I haven't even figured out for myself yet what I want our brand to be. So how can I realistically hope to brief something into an agency that captures something I haven't even thought of yet? Instead, we've taken the hard-road of building our own website fully in-house (design and all). We're onto version 21 in case you're interested (in 5 years). And we still haven't gotten it right yet. But I'd rather fail and iterate 21 times, learning about ourselves each and every time, than pay an agency $100k to build us a site which we'd then be financially obliged to stick with until it's at least paid for itself - even if it's wrong for our current vision.
You know that feeling you get when you make a really good home cooked meal? Or when you put up an awesome set of shelves all on your own at home? Yeah, it feels like that. I love that feeling...
Now don't get me wrong - there are some things you should spend money on, and for the sake of balance, I'll list them here:
- Legal advice - just don't risk it.
- Accounting advice - same.
- In-house software tools - the $20 a month you save on your crappy CRM is not a smart business decision.
- Security - see items 1 and 2.
4. Total And Brutal Honesty With Employees
Our first few employees were pretty young. I'm talking 21-years-old-head-of-IT young. You guessed it, it was all we could afford. We were incredibly lucky with the vast majority of our early hires, and they're basically all still here 5 years later. Not only did they not ask for big salaries, but they also didn't even think to ask for equity in this tiny little startup they were joining. As co-founders, we didn't pay ourselves a salary for the first couple of years of the company. Instead, we gave our first few employees as many pay rises as we could afford. We're not talking big money here by any means. We'd sign a client for $5k, and literally give $1k each to 3 employees, reserving the rest for the next month's operating costs.
We treated every single employee as a genuine co-founder. That meant:
- 100% transparency about the profit and loss of the company (employees could access the P&L themselves)
- 100% transparency about salaries (everyone knew what each other made)
- 100% admission of failure/mistakes (when we screwed up, we told people right away rather than trying to shield them from it)
And yes, we ended up giving shares in the company to those same early employees. We carved them out of our own shares as co-founders (rather than diluting the shares by issuing more) and we didn't put any kind of vesting period onto them. The employees could literally have taken the shares and quit the day afterward. But of course, we knew that they wouldn't (and they didn't, they're all still here today).
I can tell you honestly, without those people on our journey, I wouldn't have made it. Without being able to walk into the office after a disastrous sales meeting and slump into a chair in front of everyone and admit how terrible it had gone, I would have cracked. When you're creating something from scratch, in a world where only 16% of startups survive - you have absolutely no margins for anything other than 100% honesty. Anything else is just such a heavy burden and I can't think of a single good reason you'd want to do that to yourself.
The Common Thread: Necessity is the Mother of Invention
Basically, all of our best strategic decisions came from the fact that in reality, we had few other choices. I have no idea what kind of company we would be today if we'd had millions of investment dollars to spend. What I can say for sure, is that none of the best strategic decisions we've made would have ever happened. And that's incredibly scary. It's inspiring and comforting to know that we didn't need money to take us to where we are today. And whilst we may someday take investment to hopefully propel us to the next level of achievement - I'm incredibly thankful that we never had that option at the start of our journey.
Hopefully, that might act as small inspiration for other entrepreneurs out there who want to build something, but have no idea if they can make it without resources.