Monday, August 3, 2009
Interview with William Borghetti, SendSide
William Borghetti is the CEO of Salt Lake City-based Sendside Networks (www.sendside.com), a high tech startup which has developed software to help companies send and receive messages to their customers and sales prospects. Sendside isn't Borghetti's first company; he was founder, president and chief technology officer of Campus Pipeline, which he successfully sold to SCT/SunGard in 2002 after building it to over 250 employees. We caught up with William to learn more about the company.
Tell us about your service?
William Borghetti: Sendside was founded back at the end of 2005, and early 2006, to address the shortcomings of email. If you look at communications today in your mail stream, such as the bills you receive, healthcare information, and financial information, it's staggering to see how much remains in your snail mail stream. Sendside was founded to really look at why that's the case, and not only from the usability and functional standpoint, but to address the structural deficiencies in SMTP, to create a product robust enough to deliver to organizations and individuals. We set out to build a communications network which addresses the shortcomings, in a way which you can send branded, secure communications in a highly functional say, where you can do things people only dream of in email--so you know when a message is read, if it's been forwarded to others, how much time people have spent with the content, an ability to recall it after it's been sent, modify it, add attachments after the fact, and more. It's obviously an infrastructure type of technology, applicable to every vertical -- state and local government, healthcare organizations, financial services companies, banks, alternative asset managers--anyone who sells products, services, sends outs information to prospective customers, and wants to reach them in an interactive way.
How is this different from email marketing tools?
William Borghetti: We really focus broadly around communications, addressing some very large market opportunities. Today, with the variety of email solutions out there providing marketing automation, it's one-to-many communications. You don't really have a relationship with those people. Those are emails you've gleaned or captured, and you're trying to develop some sort of familiarity wit your product or service, have them click on a link. As that giant pool is whittled down, it's kick over to sales to follow up and provide more information, and hopefully convert that customer. As you cross the bounds from a lead to a prospect, a different set of activities and communications are needed. There's a relationship, you have to communicate quickly, and you have to follow up quickly on a one-to-one versus one-to-many manner. Also, many toolsets are email based, and are not really designed to help facilitate the sales process. If you look at the activities involved with selling products that are not a commodity--considering the purchase, engaging customers quickly, telling the story of what it is and how it works, there's lots of information you need to disseminate to individuals, in the process of capturing data that turns a prospect into a client, and converts them into a closed account, and signing a contract. There's also ongoing communications needs, and the question of how you lower the cost of engaging the customer and developing that relationship as a client. There are lots of solutions in that bucket, but it's a highly fragmented space.
We see sales enablement and conversion as a market opportunity no one is addressing comprehensively. Our advanced communications network, which is at the heart of our solution, allows organizations to capture leads, validate leads, and engage prospects in a meaningful way, exponentially faster than most organizations can do today. It helps to route leads, create relationships with salespeople in an organization, disseminate information more quickly, and capture data that might be relevant to a sale.
Do you work with, or compete with offerings like Salesforce.com?
William Borghetti: If you think about CRM tools, they'd really be a partner with Sendside, around the data of the selling process. In that software, it has information about who you are calling, where you are in the stage, what the big opportunities are, and who the sales rep is. Sendside is really targeted around stuff that CRM doesn't provide, and I would argue that CRM is much more of an internal app instead of a customer facing app, because it doesn't alter the way that a customer interacts with a company, materially. The main data for that that lead information is still your CRM tool with Sendside, we just provide lots of value going into the CRM and provide a more compelling way to reach them. You have mail, Fedex, email as ways to reach your customer, and Sendside more logically plays at that higher level as an alternative to email.
How did you decide to approach this market?
William Borghetti: I've been involved as an investor and board members in many companies, and there's lots of pain at the board and investor level, with how communications are circulated. Lots of things are very confidential and don't belong in the corporate email stream. You spent a whole bunch of extra time in getting information out to that audience, and there's no visibility on whether or not they're reading it, and what they are doing after you've printed and sent it, and if they've destroyed it. It's a huge inefficiency with board members. That was a natural place that captured our attention early. Sendside does provide a very valuable infrastructure for board members to interact with companies, and we have clients using it in that way. As we started that, and we got into the market, we did our market research and--as usual--the market pulled us in a direction we may not have considered initially. Early on, that was in financial services. Financial services firms have huge needs, to be more efficient, and where phishing and security is a problem. We solve those issues very cleanly and easily, so it was a natural fit. What caused us to look at the sales side, was a conversation with a hedge fund client, and--in conjunction with the meltdown in the financial markets--asked us to do this on a secure basis, because they had a story to tell when they were selling their hedge fund, and needed to provide information they would not want to make publicly available--things like historical return data, strategy for the fund--which they wanted to provide to prospective investors, but wanted to be able to convincingly disseminate and track what those investors were doing with the information. They wanted to figure out if they just care about the returns, just interested in the financials, etc.--and Sendside Package was born in response. We pitched it to the marketplace, to find out what other companies might need to disseminate compelling, interactive content--such as hedge funds, financial services, and the broad category of every sales organization. Marketing automation was a pretty well-defined area, CRM is a very well-defined category, but there is no well-defined category with sales enablement and accelerating conversion.
How is this deployed--on site or SaaS?
William Borghetti: It's primarily SaaS. If you're small, there is no client side software to install and get running. The caveat is, we do have a number of client side downloadables that accentuate the software. We've got a notifier that helps people keep abreast of their network, so that they know when someone signs a contract or reads a package. We've also got an Outlook plug in, which integrates this into a lot of Office products. You can send a package to a client from Outlook, get the list of packages in your system, and type a personalized note. We also integrate with Salesforce.com, we plug int o add leads, so if you've talked to a guy at a trade show, you want to send them a compelling thank you for their time, you can do it in a few seconds, automatically add that lead to Salesforce.com, and be first in front of the customer with compelling content. It's pretty amazing stuff. We also have integration touchpoints in our APIs with third party services, gateways that financial services banks and credit unions, credit card companies deploy as a boundry piece of their data center. We can be flexible as we need to be in our network architecture. But, to just get up and going, there is no downloadable stuff, it's all available as a service.
You've had some good prior success with Campus Pipeline. How has the second time around been building a firm?
William Borghetti: The market dynamic is a lot different. With the first company we built, we were trying to solve problems in the university market, and we were in the right place at the right time. We were right in with the dot com phenomenon. When we formed Campus Pipeline, as an enterprise company solving big problems with disparate services in a University environment, we were fortunate we were not a web site tying to sell pet food--we had a differentiated product offering. Today, the macro level is a lot more challenging, and requires you to be much more nimble. The economy today is driving our solutions and product development, and is a marked contrast to 1999 or 2000, where there was an overabundance of cash everywhere, and people throwing money at everything. Then, the riding tide lifted all boats; today, only the strong survive. We think we have a strong story, and going to organizations with hundreds of sales reps, we're increasing their efficiency and adding millions to their bottom line. We're much more pragmatic this time around, and hyperfocused on business value, and answering those questions with the new features we're rolling out. We figure out how the customer will use it, will they care, how does it solve their pain, and are not so focused on what's cool, neat, and new. There's a different feel today, in terms of the availability of cash and working capital to grow, the decision to bring products into market, and developing a strong business model at the front end, versus just developing and letting that come later. It's obviously unique in this go around, but we have the benefit of a great team, and we think if we can be successful in this market, watch out in a couple of years when the economy recovers. It will be exciting.
How are you funded?
William Borghetti: It's all been internally financed, and we're financed entirely by private investors. It's a pretty close knit group, we have no institutional investors in this deal. Part of our strategy has been to get into the market in a meaningful way, and get the product moving forward, before we look at options such as a preferred round of marquee partners, or whether we're just continue to grow organically.