How do you build a $500 million business? With BigMachines’ recent sale to Oracle for nearly that much, we knew we’d have a lot of fun sitting down with founder Godard Abel. Having built the company from the ground up, Godard gave us great insight about his company’s exponential growth during the dotcom era, the decisions that saved his creation after the bubble burst, and his own feelings about the ingredients for success. Check out the full video below.
It’s Not Scrap Metal
BigMachines is a cloud software company that helps businesses provide complex ordering configurations to its customers through a seamless online process. “I used to get a lot of phone calls from guys selling scrap metal,” Godard laughed, referring to the industrial nature of the company’s name. In fact, people often asked why he didn’t change it. “But we had a long-time sales rep who said that once people remembered [the name], they remembered it.” So it just stuck.
The idea came about after seeing the sales process Godard’s own father would have to go through in the pump business. He searched for a solution that even small companies could use in order to sell configurations of products without needing an enormous and technically savvy sales team, and developed his creation with the efforts of four co-founders.
Launching in the Dotcom Era
BigMachines took shape in 2000, shortly after Godard graduated from Stanford Business School and right during the dotcom bubble. “I definitely think we thought that we were the kings of the world,” he admitted. “It was so infectious…it was hard not to be infected by it. At that time, if you had any entrepreneurial bone in your body, you just said, ‘I want to be part of startups.’ And I definitely got caught up in that.” After visiting a friend of his father over Thanksgiving, he met up with the friend’s brother, the entrepreneur and investor John Sculley.
The Challenge of Product-Market Fit
Despite a seemingly effortless beginning, BigMachines had a few challenges in its early years. “We were selling a cloud product, and the world wasn’t ready for the cloud. Secondly, we were targeting manufacturers, which in hindsight was the worst vertical to pick. They were very conservative…so we didn’t find a lot of those early adopters…we were a dotcom and in March 2000 people were like, ‘When are you going to retire?’ and a year later people were like, ‘When are you going to go bankrupt?’” People were afraid of investing in a company that would crash with the dotcom burst, and BigMachines had to make a lot of changes to its model in order to survive the market swings.
Over a decade years later, Godard is taking some lessons from his success with BigMachines to his new company, G2Crowd:
- Focus on your early customers. “Listen to them and see what works for them. We did that, and ultimately that set the foundation for making it successful.”
- Spend your money slowly. “I think the first lesson is everyone talks learn startups now…as a venture capitalist, three of your 30 [investments] are big winners, you’re going to do well with your fund. But as an entrepreneur, you only have one bullet. As an entrepreneur, your level of certainty on the right time to step on the gas has to be a lot higher.”
- Have a killer team. “The main good thing we did was…having a team with heart and that’s passionate, and smart and doesn’t quit…you almost can’t lose. I think that’s the best thing we did. We have so many awesome team members here, and that’s what I think is fun and gratifying, and that’s what made it work and that’s what we’re doing again. That’s what I believe in more than ever.”
- Be persistent. “I almost think you can’t lose if you’re smart, hungry and give yourself enough time…With a smart, persevering team, it’s gonna work.”
Why Chicago is Great
We love to ask our founders about why they picked Chicago to work. Here’s what Godard had to say:
“The main [advantage that Chicago has] is that there’s great talent…if you look at talent as ‘Hey, I just need smart hungry, fun-loving people,’ then Chicago is unmatched. And I think the whole Midwestern ethic is a big strength. We’ll stick with a startup for a year if it’s not going public yet. And the cost structure is better. If you’re going to bootstrap or fund your own business, it’s easier to do it here.”
Check out this and more in the video below:
We hope you enjoyed this interview with Godard, and look forward to the next Chicago Founders’ Stories @1871 with Bootcamp (formerly 37Signals) founder Jason Fried on February 27th! Click here to sign up for the event now. We’ll learn about why 37Signals made the jump and what it means for Chicago and the tech community.
Pat Ryan is a business and social entrepreneur who has created several high growth software companies as well as several innovative urban education initiatives as a social entrepreneur. Pat’s first company, FirstLook, was recognized by Inc Magazine in 2008 as the #4 fastest growing software company in the U.S. in its Inc 500 rankings – the highest ranking ever for a Chicago based software company. Pat is also the Founder of MAX as well as the Founder and CEO of INCISENT Labs, a platform and incubator for innovative, industry-changing technologies that spin out into high growth companies. MAX was created in INCISENT Labs where Pat and a team are currently incubating their latest start-up. Pat blogs at Coolerbythelake.com and can be reached on Twitter @PatRyanChicago.