Key Takeaways From Pressnomics 2012 Day 2

If you missed it: Key takeaways from Pressnomics day 1.

Mikkel SvaneMikkel Svane, @mikkelsvane

Zendesk, a new generation enterprise software startup

you shouldn’t think of customer service as a cost, but as an opportunity to increase revenue.

Zendesk started out as 3 consultants who didn’t want to end up being consultants for the rest of their lives. According to Mikkel, there is no better time to build an enterprise software solution. Right now, there are a ton of old legacy on-premise software out there that companies want to replace with a new lean agile SAAS software solution.
They bootstrapped their business for the first couple of years and because of that, it was hard to keep everyone on the team focussed. The team had to work really hard, but without a salary. After they got some traction and received funding, they moved to Silicon Valley. He said that there is no place in the world like San Francisco and Silicon Valley. — “There is a whole ecosystem catered to you. You are the center of the universe in Silicon Valley, and it feels fantastic.”
Zendesk has come a long way since the 3 consultants founded the company. They now have 300 employees with 20+ nationalities. He even stated, “I have 40 finance people now, and I have no idea what they are doing.” They are planning on growing 50% by hiring 20-30 new employees each month. He mentioned that “you need to have a machine to take care of all of the culture and HR.”
He talked about how having a subscription service is fantastic, as long as  you keep your churn down. If you have a product that grows organically within the organization, you will see your revenue increase significantly. After Zendesk is implemented into an organization, it grows by an average of 40-60% in the first AND second 12 months. They have worked closely with fast growing companies like Twitter and Groupon, who have grown their employees into the thousands.
He said that they are lucky to have a business model that allows them to have financial freedom. They have the leg room to build the foundation for what they want the company to be today and in the future. He sees Zendesk becoming a public company in the future.
Someone in the audience asked him if he had any suggestions for reducing the cost of customer support for clients, because the extra costs with software solutions like Zendesk can get fairly expensive. Mikkel answered the question by saying that you shouldn’t think of customer service as a cost, but as an opportunity to increase revenue. It provides you with an opportunity to provide customer support that not only leaves a long-lasting positive impression but that also fosters more revenue.


Frederick TownesFrederick Townes, @w3edge

Open Source Business Development – [SLIDES]

It is our jobs to make things more clear. If people are asking a question that you think is right in front of them, obviously, it isn’t and it needs to be fixed.

Do you understand what success looks like? Frederick believes that open source businesses are an opportunity to help other people by solving a problem. When you are in the open source business like WordPress, you need to “Dial in the narrative”.

  • Identify the nearest neighbors, competitors, and partners.
  • Ask yourself where your company fits into the ecosystem.
  • Whatever your niche is, determine how you coexist with these other people.

“The platform is the people, which is a strength and weakness. What WordPress needs is a platform that goes beyond publishing, but for people trying to build a business. The web is built on various stacks, and WP needs to play its role.”
He identified a few problems with WP platform:

  • Leaders are solving the same problems because it’s too difficult/costly to give their technology away
  • It needs to be easier to co-create
  • WordPress is not RESTful, so innovation in the ecosystem has been stifled
  • Reactive innovation must become decisive

He talked about some lessons learned from w3 Total Cache:

  • Anticipate questions and answers
  • Collect info before engagement
    • Instead of having the customer spend 20 minutes trying to explain what they did, he would already know. He would try to figure out what the problem was for his customers before they even called in. Providing a level of customer service that they hadn’t seen before.
  • People just want the answers
    • He said that he usually doesn’t reply with “Hi” anymore; just the answer to the problem.
  • Expect tl;dr – be patient — People don’t read
    • It is our jobs to make things more clear. If people are asking a question that you think is right in front of them, obviously, it isn’t and it needs to be fixed.
  • Answer the question, don’t editorialize
    • Our opinion doesn’t matter  — Do people want to use our software? Refer people to our software? Pay the monthly fee?, etc.
  • Apologize even if it isn’t your fault.


Joe StumpJoe Stump, @joestump

Starting your Startup – [SLIDES] – [VIDEO]

 Focus on the problem. If you are only excited about the solution, you will lose interest when your solution doesn’t fix the problem.

When you start your company, it will be lonely at the top according to Joe Stump. The idea and vision is yours and no one else really understands what you do for the company.
The vision problem: You will never fully implement your vision because it is ever changing with time and customer feedback.
“Founding a startup is really f&*#!%& hard. No Joke.” He used a Mark Cuban quote, “If you have an exit strategy, it’s not an obsession.” Focus on the problem. If you are only excited about the solution, you will lose interest when your solution doesn’t fix the problem.
Find a mentor who has founded a startup before. Don’t go into the process of starting a company blind.
Forming the company:

  • Choose your partner wisely
    • Try to find someone that you know professionally, but not personally. Stump said that he has had the most success with this kind of relationship.
      • If the person is a friend, things will change.
      • If you don’t know the person, who knows what you are getting yourself into.
  • Find people who
    • have similar work ethics
    • complimentary skill sets
    • similar approach to product development
    • similar values
  • Be wary of giving the title “co-founder” to early employees
  • Find people economically aligned with you
    • If you don’t have any money and your partner has millions in the bank, your different point of views towards money could create tension down the road.
  • All founders should be on a four-year vesting schedule.
    • One year cliff, 25% vested up front, monthly vesting after cliff.
  • Set aside 15% for an employee option pool.
    • Your investors will make you do this anyways
  • File your 83 (b) election
    • Don’t forget this or you will regret it
  • Hire a good lawyer
    • Using cheap lawyers is an extremely dumb idea
  • Delaware C Corp

He talked about the two paths you can go down: Bootstrapped and Venture Backed.

  • Bootstrapped: Have control and no dilution, while not necessarily being able to be fast-to-market and have no distractions.
  • Venture Backed: Be fast to the market and have no distractions, but lose some control and have dilution.
    • You can be fired from your own company.

He suggests that you raise money when you can, not when you want to. If a VC opens up their checkbook, take the money, because 6 months from now you might really need that money.
Look for VCs who have:

  • founded and ran startups themselves
  • some of their own money in the game
  • understanding about the problem you are solving and who are excited about your solution

Remember that investors are not your friends.

Micah BaldwinMicah Baldwin, @micah

The Power of Story

There are products out there that are better than mine and yours, but because I am a brutally honest guy and a good person, people will use my software instead.

In business and life, it is hard to hide your true story. The story that you want to tell is the story of yourself. Who are you and what you are about? How do you translate the story of you for the business?
After a sales call, the first thing that a person talks about is other the person on the phone, not how good their product is. We say things like, “Yeah, that person seems like a good person and I like them, so, I want to buy from them.”
He said, “There are products out there that are better than ‘mine’ and ‘yours’, but because I am a brutally honest guy and a good person, people will use my software instead.” Being consistent and reliable will always get your further. He said that the reason why even douchebags win is because they are consistently douchebags. You need to tell a consistent story in order to win.
We all make assumptions with people everyday. He gave the example of himself and how he has multiple tattoos that are easily visible. No matter who you are, it is impossible not to create certain assumptions about him just on appearance.  He said because of those visual things, he actually has to spend time getting people back to the “starting line”. The starting line of them thinking, “Oh, this guy is smart and actually knows what he is talking about”.
Don’t change your story, but know it, and understand how people view it.  If you want to see how others view you, do what Micah did and use Facebook and Twitter to ask the following question: “need your help. If you were going to describe me in 1 or 2 words what would they be. (If you want to add why, feel free.) Thank you!”   You need to view yourself the same way that other people view you. They need to match, so your energy can be used to build something awesome.

Mark JaquithMark Jaquith, @markjaquith

Growing with WordPress

Make sweet WordPress to each other.

Mark is the lead developer of WordPress core, but remains independent, so, he actually isn’t employed by Automattic. He discussed the fears of Automattic, the elephant in the room for the WordPress business community.
The Good:

  • If the WP Core team believes there is even a perceived negative view of what is going to happen with WP, then they will challenge the change.
  • Automattic doesn’t own the trademark for WordPress, the WordPress foundation does.
  • The WP Core team never holds back changes that might hurt Automattic.
  • The WP Core team wants you to win.
  • WordPress provides a large marketplace, but with a tight community.
    • Find your peers to stay more connected within the community.
  • You can talk to the Core team if you are having issues with WP.
  • You can become more involved with the WP Core to help shape the future of WP.

The Problems:

  • is owned by Automattic
  • Askimet, the commercial spam fighting plugin is built into WP Core, which looks like favoritism.
    • He would like to separate Askimet from the WP Core, but also not leave a gap for the user when protecting their sites against spam.

Mark suggests that Automattic is “A WordPress Company” and not “The WordPress Company”, even though they are most likely the biggest and most influential.
Give back to the WP community:

  • Patches: Open a ticket and submit a patch
  • Plugins: Try to open source your plugins
  • Themes: Create free themes
  • Tools: Share your custom tools
  • Knowledge: Start a company tech blog to share your expertise
  • Donate a coder: A dedicated WP Core contributor
  • Patronage: Hire an unconstrained coder to build cool WP stuff

When looking for a WP developer, hire within the community, but also look outside of the WP community because there is a limited pool.
He ended by saying, “Make sweet WordPress to each other.”

Chris DrakeChris Drake, @ChrisDrake

How to Grow a Company When “The Sky is Falling!” [SLIDES]

…get “off of the drug”, which is anything that is holding you back.

FireHost got into the secure web-hosting space by chance. Back in 2003, Qualcomm’s servers went down and they were having trouble fixing the problem. At the time, FireHost had Qualcomm’s site on their staging servers and suggested that Qualcomm pointed their DNS records to FireHost’s servers in the meantime.
Another one of their clients, Butterball, had issues with hackers, so they went to Rackspace and other hosts at the time to see if they could offer what they needed. The other hosts couldn’t guarantee a secure environment, so FireHost told Butterball that they would figure it out themselves and the rest is history.
They went out of their way to protect the most attacked sites on the Internet. Kevin Mitnick is a famous hacker who now runs Mitnick Security. Drake told us that Mitnick has been a customer for 3 years, and over that period there have been 1 million hacking attempts and zero breaches. Their story about protecting Mitnick’s site gets them a TON of press.
As the secure hosting business started to take off, Drake was at a crossroads because he realized that he could either have the “whole grape or a piece of the watermelon” — He went with the watermelon. He had to get “off of the drug”, which is anything that is holding you back. For FireHost, it was the design services side of his business. He mentioned that he could have sold his design services business for seven figures, but in order to get rid of distractions, he just shut it down. Also, they went through a “taking out the trash” phase where they got rid of their dedicated hosting option and focussed solely on the cloud.
They soon realized that their customer acquisition cost was higher than expected, so they actually doubled their prices across the board for all customers.
He now spends the first half of his day on vision and what is going to happen in 6 months. The second half of his day is about communication. He started doing this after he had the right people in place that he could trust to make decisions. He was able to eliminate himself from the daily decisions.
Most recently, FireHost went through a “spring cleaning”, where they shut down their marketing efforts because they felt like the wheels were starting to wobble. They turned marketing back on after they fired, hired, and restructured things, which then fueled their company’s growth rate even more as they became more efficient.
Someone in the audience asked Chris, “Why are you doing this?” and he said, “To protect people”. He talked about how he has no interest or passion for selling shared hosting at $5.99 a month, but throughout his life, he has always had a passion and instinct to protect people.

Collis Ta'eedCollis Ta’eed, @collis

Push, Hustle & Grow 

Marketing is not a sometimes activity, but an all the time activity.

How do you go from working in an old warehouse to a 100-person staff? Well, Collis Ta’eed, from Envato, the company who owns Theme Forest (and others) told us his story and how you can grow your business.
Push (Mindset)

  • You have to push through because there is a lot of pain and struggle when having a business.
  • Business, life, and everything is uncertain, but you need to have resilience and be determined.
  • Sure, it might not work out, but NOT because you didn’t give it your damn all.

It is now easy to look back and say that they made good decisions and used their times well, but really, at the time, he was a person who used up all of his savings, had credit card debt, borrowed money from his parents, just got married and was living in a basement of an old warehouse.
Hustle (Customer Acquisitions)

  • Make. Things. Happen.
  • Marketing is not a sometimes activity, but an all the time activity.
  • Whatever you are doing, you need to have your marketing hat on.
    • Example: How can customer service help you grow your business.
  • Marketing starts in the product.
  • A product that spreads is:
    • Worth talking about
    • Encourages sharing
    • Incentivizes sharing
    • Has built-in vitality
  • You must have some metrics because they give you:
    • Insight into what works
    • Tactical and market knowledge
    • A measure of value vs effort
  • Be creative and resourceful: You must try every marketing activity possible and see what works for you.
  • Marketing is about building momentum because the Internet rewards it.

When you are hustling and trying to acquire customers, remember that small things lead to big things, the internet rewards momentum, revenue gives you more firepower and that all of your efforts will build a virtuous cycle.
Growth (Organization)
Have an attitude of learning. If you want to grow, constantly take yourself out roles by replacing yourself. Don’t overextend and try to do everything.
With 2+ billion people online (and more each year) and the huge opportunity, he feels like people will look back and say that the Internet is like the Wild Wild West.