John Knific CEO, DecisionDesk john@decisiondesk.com

Becoming an Enterprise SaaS Company

December 3, 2015

DecisionDesk is a team of EdTech veterans and former admissions professionals who excel at collaborative SaaS solutions by streamlining any digital admissions process through intuitive submission, review, and decisioning technology. This enables institutions to efficiently yield the best applicants and retain that data for student retention, unlike static, legacy systems that can’t adjust to a shifting technology landscape.

What is DecisionDesk (today)?

Let’s go back…

Founded by three college friends

Our journey began with a fairly common college startup combination…no experience, lots of passion. While the company is run by a different team now, with many pivots and learnings along the way, having a ‘hacker, hustler, hipster’ foundation was ESSENTIAL to execution

Social networks were all the rage

The initial ‘spark’ was not based on solving any practical pain points. We were trying to build a social network for creative professionals. But the necessity to survive put us in front of universities, in an attempt to target college students. Now we understand the term customer development, but then, we were just trying to ‘sell something’. It turned out the universities we approached saw something we didn’t. They needed help managing the review of portfolios from applying students.

2010

Online Portfolios

First business model

Avg. $7,500 ARR

We had great success during our first two years as an online portfolio provider, scaling to $500k+ in recurring revenue. This was a SMB SaaS play, with short setup times, and a fairly ‘out of the box’ application and review process for our customers.

The first pivot

One problem… we were becoming kings of a molehill. Higher Ed is a great market, ripe for disruption, but the market dynamics require you to drive lots of value per customer. There are simply not enough schools to build a venture-backed company at SMB average deal sizes.

The first pivot

So we pivoted. It was a bad year. I had to take a machete to the organization. With weeks of cash left, we cut half the staff, assembled a bridge round, and were faced with some tough decisions.

Lev GonickFormer CIO at Case Western Reserve University, EdTech thought leader

Jason Palmer

Deputy Director, Bill and Melinda Gates Foundation, formerly Microsoft, SchoolNet, Kaplan

James Werner, EVP Sales

10+ Yrs Education Sales Blackboard, SunGard HE

Kate Volzer, VP BDDirector Admission, U Chicago MBA, Chicago Booth

Talent 2.0 - Industry Focus

Jon Boyle, (former) VP Products

2x Entrepreneur/Product Lead

Tim Downs, VP Technology

HubSpot, Mongoose Metrics

Then came something great. Focus. We recruited a series of high caliber executives and board members with a much better understanding of the Higher Ed market place, and experience with larger SaaS deal sizes. That year, we held OpEx stable, and doubled revenue.

2013

Online Admissions

Avg. $35,000 ARR

Second business model

We targeted universities with a solution to manage the end-to-end application and review process for all admissions, not just portfolios. Things were looking up.

Then a new problem surfaced. We may have had a better business model and focused execution, but there was increasing competition in the EdTech marketplace. An important strategic question emerged… how do we drive 6-figures of value per customer and avoid becoming a commoditized product?

2015

EnterpriseDecision Management

Our Story

$Xm | 5-Year ContractThrough a combination of timing, having the right people, and luck, we were short listed for a massive state system RFP. Then the impossible, we won, beating massive enterprise names in the market. DecisionDesk had it’s first 7-figure enterprise-wide contract.

Big win

We felt like badasses…

In the course of 6 months we attempted to…

• Implement a customer 6x larger than our next largest

• Rewrite our product from scratch

• Still grow revenue by 100%

• Not lose any customers

…then we took inventory of action items

Uh oh

Suffice to say, the heat was turned up and we felt like the ones in the explosion

What are the (hard) lessons we have learned pivoting into

Enterprise SaaS?

Don’t rewrite your product from scratch

…and pray at the alter of incrementalism

Pivot lesson #1

Ok, this statement is a bit extreme. But rarely has a company said “well that went well” after initiating a re-write. There are years worth of incremental decisions to keep customers delighted in a product. These are often not factored into the decisioning process. Most times, the decisions to re-write can be accomplished with less drastic measured, and can be phased.

Vision: Decisioning Hub

Decisioning(Insights)

Application Data

Review Data

CRM Data

SIS Data

Doc Mgmt Data

The re-write did help us hone our vision, to become something bigger than an application company

Module Based Approach

ADMINAPPLICATION REVIEW Portfolio

API, Data Warehouse

Configuration, Users, Global Preferences

Connector ConnectorConnector Connector

After some trial and error, we landed on an approach that decoupled the various web applications we were offering, and our data/integration/analytics IP, which has become fundamental to driving enterprise value (and positioning us to do some very interesting things in the market)

Discovery earlier is much much cheaper

than discovery later

Pivot lesson #2

MonthWeek 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4

b b b b b b b b b b b b b b b bb b b b b b b b b b b b b b b b

b b b b b b

d d d d d d d d d d d d d d d d d dd d d d d d

d d d d d d d

s s s s s s s ss s s s s s

s s s s

N2N ImplementationReview HandoffUIS UAT

Test ConnectionReview HandoffUIS UAT

ConfigurationReview HandoffUIS UAT

Review SpecsApprove Approach DocumentImplementationReview HandoffUIS UAT

Security Touchpoints

212 b b5 b b b b b b1 b b

July Aug Sept Oct Nov Dec Jan Feb

DecisionDesk Onsite (If Required)

Project Deliverables

BOULDERGradUndergradContinuing Education

DENVERGradUndergradContinuing Education

COLORADO SPRINGSGradUndergradContinuing Education

INTEGRATIONS AND SECURITYCampus Solutions

SSO Admin

Scope SSO Undergrad If required in scoping

Nelnet

Singularity

Security Audit and Final UIS UAT

Production Switch Over

CONTRACT DEADLINES

11/1/2015Feature complete stage environment.Feature UAT completed by selectcampuses, approving Core Product portionof Scope. Remaining functional team worklimited to Configuraiton UAT

3/1/2016Latest deadline for full go live of remainingschools, contingent on UIS final testing,and one month window for productionswitch over

Implementation Deliverables

BoulderGrad

Review 1 General Grad Program Spec1 Completed Program HandoffFeature Focused UATDocument remaining program specsAdmin/Operations Handoff

Far too much of our initial discovery was post contract, and that puts everyone at risk; you, the customer, and your team. This is a screen shot of our project deliverables. While we can’t share the details, it’s clear the scope became far more complex than originally anticipated. This was a very important lesson to be successful in the enterprise market, and create repeatability in our approach.

FieldSales

Solu=onEngineer

The Deal Trio AccountManager

SME

•  Primary client contact •  Manages relationship •  Understands decision making unit

Or

•  Interprets client requests into DD terminology (“Ah, that would be a Bin, and this is how it works”)

•  Answers approaches to integration and implementation

•  Describes case studies and the benefits of a solution

•  Injects thought leadership into the conversation

Super Demos

Identify Pain

Points

Verify Solution

Draft Solution Proposal

Deal Trio

We crafted a much stronger sales and solutions process as a result

Don’t split the baby, pick a market focus

Pivot lesson #3

SMB Enterprise

84 Customers ~$10,000 ARR + 1 Yr

13 Customers ~$90,000 ARR + 3 Yrs

• 30-day implementation • 3-month sales cycle • Inside Sales

• 120-day implementation • 6-9 month sales cycle • BDR + Field Sales + SE

Our new focus required fundamental change throughout the organization, including marketing, sales, and customer success. This was managed well, but has been no small undertaking.

Scrappy is good, experience is better

Pivot lesson #4

I’ve heard the term ‘Navy Seal Team’ used when describing the select group of people who will navigate, win, and execute really massive contracts. As a startup, still feeling its way into the market, an Ocean’s Eleven operation was a more apt analogy.

Create role ownership

Subject Matter Expert

Solutions Manager

Product Manager

Engineering Manager

Enterprise Sales Lead

Customer Success

Platform

Manager

Understanding the balance of skills needed for enterprise contracts was a critical moment for the organization. Startups usually have a mix of talents with strengths and weaknesses, all adapting to the needs of their customers. While that won’t go away, you need to have ownership of key areas to properly execute an enterprise contract. Missing one of these components will hurt, causing you to either lose the deal, or worse, win a deal that will sink you because it’s not the right fit.

Create role ownership

Subject Matter Expert

Solutions Manager

Product Manager

Engineering Manager

Enterprise Sales Lead

Customer Success

Manager

Platform

Manager

Relationship/

Owns DMUInterpret Needs/ Implementation

Integrations/Security/

Relationship Post Sale/ Growth

Here are a breakdown of the skills needed in each of these roles

The reinforcing products process, with a Subject Matter Expert (SME), Engineering Manager (Scrum Master), and Product Manager (Product Owner) is what creates visibility and predictability. Enterprise contracts are never done being implemented. They grow, change shape, and require constant nurturing. Lacking a good product process can be very demoralizing to your team, as they will get lost in the trees (field mapping, custom code, etc) and lose track of the forest (your vision and the customer outcomes)

It’s ok to be picky (with deal flow)

Pivot lesson #5

You can waste tremendous time with leads at the wrong decision-making level. It ties up your resources, and results in fewer sales qualified leads (SQLs) that will convert into material opportunities. Remember the note about understanding your decisioning making unit (DMU)? Focusing on a smaller batch of targets with the right decision makers is a game changer. A VP-level prospect, for example, will focus on long term outcomes and be less price sensitive. Director-level will be more tactical, tending to nickel and dime over features. Enterprise software requires discipline to avoid price feature trench ware fare. After taking the time to hone our messaging and be more discerning over pipe, we saw a massive uptick in pipeline.

In Summary

• Be careful before executing a product re-write, there are generally more wrong reasons than right ones

• Be vigilant about the customer/solution discovery process, and understand your customer’s decision making unit

• Elevate your scrappy team with the right experience, an enterprise deal requires you to build a navy seal (or Ocean’s Eleven) team

• Be picky over deal flow, never stop honing your targeting

Our customers are now much happier, we are better positioned to scale, and have a better view of the ‘forest’.

John Knific CEO, DecisionDesk john@decisiondesk.com

Becoming an Enterprise SaaS Company

December 3, 2015