MailChimp is a well-known but it’s not like other high-profile tech companies. For one, it has never taken venture capital. Instead, MailChimp has steadily rumbled along for 13 years. This year, it expects revenue to be US$400-million.
You have to shake your head. I mean, how can a tech company be worthy if it doesn’t have spotlight-hungry founders, tapped VC or pursued an IPO?
Despite MailChimp’s unorthodox approach, its success illustrates there are different ways to grow a tech company. Successful companies don’t have to raise VC, and like MailChimp, they can happily operate in cities not considered to be hot startup hubs.
The journey from idea to reality to business takes a variety of paths. Sometimes, growth happens quickly. Sometimes, growth is slow and or doesn’t happen. And to be honest, it’s often impossible to know which path a startup will take.
Of course, the media doesn’t focus on steady-as-she-goes startups. The media likes overnight success stories (aka lottery winners) or startups that soar and then burn to the ground – Theranos, anyone?
Startups that don’t raise VC often operate under the radar because it is difficult to know how much success they’re enjoying – unless they wave the flag. But I would venture there are many ultra-successful startups that you’ve never heard about.
In thinking about a Canadian version of MailChimp, the company that came to mind is AgileBits, which makes 1Password, one of the world’s leading password security companies.
From what I can tell, AgileBits doesn’t seek the spotlight and it doesn’t attract a lot of media coverage, although the trade press seems to be big fans. (A quick search on Google unearthed two profiles: one in The Toronto Standard and another in the National Post.)
But AgileBits steadily moves forward with product improvements and new revenue sources. According to Owler, the 10-year-old company has sales of nearly $50-million. If that’s accurate, AgileBit ranks among Canada’s biggest software companies.
AgileBit’s low-key approach is fascinating but it is just one flavour of growth. Here are some other paths:
Not an immediate hit but doggedly persistent: Many startups create compelling services but, for whatever reason, they don’t see immediate success. Case in point is WineAlign (an ex-client), which launched a service in 2008 to help wine drinkers in Ontario make smarter choices at the LCBO. It was a great idea but it took a few years before consumers embraced it. Today, WineAlign also operates in British Columbia and Quebec.
Another example is Wave Apps (another ex-client) whose free online accounting software wasn’t an immediate hit….until it appeared on the Chrome store on the same day as Angry Birds.
A product ahead of its time: Sometimes, great business ideas are too early because demand isn’t there yet. It can take years before the market is ready to jump on the bandwagon. It means companies need to hang on until the world discovers they’re selling something compelling.
I know this lesson from personal experience. During the dot-com boom, I co-founded a startup, Blanketware, that focused on using natural language navigation so consumers could easily find services and products. It was a Web 2.0 company before there was a Web 2.0, otherwise we would have all been millionaires (well, maybe!). Unfortunately, BlanketWare struggled to find product-market fit before eventually calling it a day.
Discovering the market really likes a particular feature, but not your product: I did some work for Nudge, which was trying to position itself as a mobile tool to drive corporate social responsibility programs. While the idea wasn’t a success, the company was able to pivot into a mobile tool to educate and motivate retail employees. Another great example is Instagram, which struggled with a service called Burbn before it pivoted.
So close yet so far from success: For many startups, success is elusive, even when it’s close. There are startups in the right markets but their products fail to capture the imagination of customers. Maybe the pain being solved is that significant, or maybe the price is too high, or maybe there are bigger priorities for IT budgets. I have worked with clients that are oh-so-close to making it but still waiting for their big break.
Right time, right place: Since starting my consulting business, the client that nailed it was Sysomos. When I saw the social media monitoring service in late-2008, it wasn’t pretty but the technology was amazing. As important, the timing was perfect as social media was emerging so Sysomos’ technology was an obvious option for PR agencies and brands. The company was later acquired by MarketWired.
Admittedly, these are just a handful of scenarios. As much as VC-backed startups are glamorous, there are different ways to grow – something them more about blocking-and-tackling than basking in the spotlight.
I’ve worked with dozens of startups and fast-growing companies looking to establish or accelerate their marketing. My services are driven by frameworks and processes to create messaging, strategic plans and content. If you want marketing that makes a difference, let’s talk. If you are looking for hand-picked startup content, subscribe to my weekly newsletter.