10 Sep Ask the founder
What would you ask the man who built, grew and sold MessageLabs for $695 cash? The SaaSGrowth audience got that chance. What happened?
In June we staged our first Sales Confidence conference at HereEast, in London’s Olympic Park. We called it SaaSGrowth2018. We had over 200 SaaS professionals in the audience, watching more than 30 of London’s foremost SaaS experts share their knowledge. Even if you couldn’t make it, we want to share the inspiration and education with you through our SaaSGrowth2018 articles.
It was a pleasure to welcome Jos White to the SaaSGrowth stage. What a story! Jos co-founded and built 3 businesses with his brother Ben — RBR Networks, Star and MessageLabs. The last one is the fascinating one. In 2008, MessageLabs was acquired by Symantec for $695 million. Now Jos is an investor at Notion, the VC firm focused on B2B SaaS and Cloud tech.
In Jos’ talk for SaaSGrowth, he shared his story, including 6 pieces of advice if you’re looking to build your startup into a multimillion-dollar company. You can read more about it here.
After Jos’ talk, he was kind enough to take questions from the floor. Here’s what happened.
The first question was:
‘What do you think you got wrong in your sales approach?’
You need to watch the video to see the face Jos made on hearing this question. There was clearly quite a few examples to choose from!
‘Phew! So many. When we started we decided we were going to sell through the channel, because we’d come out of an ISP. We thought all ISPs and telcos would want to resell this service as it’s such an obvious add-on to what they were doing. We thought it was going to fly off the shelves.’
‘We quickly realised that big telcos are set up to fulfil demand. They’re not consultative salespeople, like you might get in a smaller organisation. It turned out to be a complete disaster. After the first year, we were at around 30% of target.’
‘We swung all the way across to building a direct sales organisation, which I think you really need to do in the early years. You need to stay in control of your sales process.’
The 695 million dollar question
The next question was brilliantly simple.
‘Why did you sell the company?’
‘Well, were so focused on IPOing. We were in debt and overdrawn, the usual entrepreneurs’ story. We thought we’d make some sort of an exit from the IPO. We were also going to raise more money for MessageLabs so it could grow and start to acquire companies. That didn’t happen because of the recession.’
‘When we knew we could exit through an all cash deal, it made sense. It would’ve been difficult for us otherwise, because of the recession. We didn’t have enough money to make things happen.’
‘Part of me still wishes we hadn’t though. We could’ve acquired companies and rolled out. But it was more timing than anything.
What matters most
Our final question was:
‘What’s most important to manage? Investors, staff or customers?’
Jos didn’t have to think too long about this answer.
‘I think we were most focused on our staff.’
‘I don’t know if we took our customers for granted, but I think we should’ve invested more in them than we did. The reason we didn’t, is because we had a really clear value proposition for what we were selling. Customers would be inundated with email viruses. They didn’t have a solution for it. We provided a clear solution.’
‘We spent more time on culture and internal management instead.’
Thanks to Jos for answering our audience’s questions. If you have anything you’d like to say about Jos’ answers, leave us a comment.