Knowledge Institute Podcasts
Scaling Software Companies with Greg HeadJanuary 28, 2021
Starting a business has never been easier, but growing and scaling a startup is harder than ever. Greg Head, founder of Scaling Point and Greg’s List and 30 year veteran of the software industry, shares how he helps software companies navigate changing consumer expectations, funding opportunities, experimentation and product/service innovation as they scale… or fail.
Hosted by Jeff Kavanaugh, VP and Head of the Infosys Knowledge Institute.
“There's a chemistry project in every startup between the founder, their market, the current situation, their luck, the situation, their resources. That's a wonderful puzzle that is different every time.” -
- Greg Head
Can you share a particularly stark example of [the] digital ceiling?
Jeff introduces Greg.
Greg explains the software industry beyond Sillicon Valley.
Can you characterize any differences in philosophies from these founders who aren't in Silicon Valley, or there's some common threads?
It's almost like it's the adulthood of the software industry, all these mature niches start to, profitable niches, that might not make someone rich immediately or grow quickly. And yet, they're good, viable businesses.
It's interesting over time, if we see that these software leaders are no longer the Jack Dorsey type of folks, and you more have this breaking the stereotype.
Are you involved in the so-called crossing the chasm phase or is it even before that, where they're trying to get to the point where they're at the chasm?
And as you're looking at companies, what are the critical success factors to get from that 20 employee, million or two of revenue, to go to that next level? What is it that allows you to get to that next level where a lot of companies fail?
You said they have to climb up the stairs and get people lined up. Does that follow the product market fit?
What about the people side of things?
Can you talk about what SaaS means?
What could a corporate larger company do to embrace the SaaS startup concepts and maybe grow themselves?
Greg describes how growing companies can turn aggressiveness and impatience into positive output.
What are some other nuggets or insights that you can share, especially that made the difference?
What is one thing that large companies aren't aware of that is essential for them to be able to do this going forward, to take advantage of SaaS and to create these new offerings and capabilities that they might be overlooking?
What's the one thing that either someone in the trenches today that's trying to get a software company going, or even that business school or engineering student who is trying to tinker on the side and really wants to launch, what is one thing that you'd leave with them to give them something to think about?
You talk about the scaling point system. What exactly is that?
Greg shares his contact information.
Jeff Kavanaugh: For many years, large, incumbent companies have tried to be more like startups and failed despite embracing leading business fans. The challenge remains, how can large, complex enterprises behave like startups while maintaining resilience at scale? Greg Head, you said that starting a business has never been easier, but growing and scaling a startup is harder than ever. Most who try gets stuck or hit a plateau, including so-called “A-players” and second time founders, funded companies, and even natural born entrepreneurs. Can you share a particularly stark example of this digital ceiling?
Greg Head: I've been in the software business for 30 years, so I'll take it from the startup software and tech side of things. In the nineties and even in the 2000s, it cost four to $10 million to build a first version of a software with servers and windows and software and everything. And now you can get people paying for software that you built for $100 or $200 or half a million to get started.
Greg Head: So it's easier to start a software and tech company than ever. And there's a little bit of a myth that if you build it, there's a problem. People need software. The answer is software. You build it. Then you'll just have a growing company and it'll grow forever. That's actually not the case. Most companies that get up to a million or five or $10 million, don't get to five or 10 times bigger than that. Most companies that get investments, don't get to the end game and pay off. So most companies that get on the playing field of startup to scale don't make it all the way up. And that's just the reality of where companies are these days.
Jeff Kavanaugh: And making sense of SaaS, digital ceilings, and these digital runways is we'll be exploring today's conversation. Welcome to the Knowledge Institute Podcast, where we talk with experts on business trends, deconstruct main ideas, and share their insights. I'm Jeff Kavanaugh Head of Infosys Knowledge Institute. And today we're here with Greg Head, 30 year veteran in scaling software companies. Greg is the founder of Scaling Point, helping companies grow from startup to scale by finding the unique leverage point, propelling them to the next level. He's the creator of the Scaling Point system, which has been used by hundreds of companies around the world. He's also the founder of Greg's List, comprehensive list of local software company, jobs, and talents, spanning eight cities across North America. Greg had a successful 30 year career as a marking leader at three startups that grew to global scale in CRM. Sales Logics, Infusionsoft, and everyone's favorite, Act!, which is one of the original CRM companies. In the spirit of giving back, Greg has used this experience to advise thousands of startup founders and tech CEOs as a consultant, advisor, mentor, and board member. Greg, thanks so much for joining us.
Greg Head: Great to be here, Jeff.
Jeff Kavanaugh: We could talk for hours today because this is a fascinating topic from a lot of different perspectives. We'll just start off by just asking the question- you're an active volunteer advisor, mentor, and really therapist to hundreds of tech founders every year. Have you seen it all or are you still seeing new stories?
Greg Head: Well, there's some new stories and some old stories, and the trick is to figure out what's really new, and does the old stuff work? And we have to keep recycling that. But generally speaking, the innovation game, which existed before tech and has expanded in the last 30 years in tech, continues to roll. There's some laws of nature in there that aren't changing that have to do with how buyers buy and their brains, how markets move, how entrepreneurs think and their brains, and our brains aren’t changing.
Greg Head: But the world is changing. Tactics are changing. Marketing's changing. Every year, there's some new tricks of the trade. In 2020, some things have changed here, but the further you dig down into a company and their core issues, you're dealing with more permanent type issues. So there's a chemistry project in every startup between the founder, their market, the current situation, their luck, the situation, their resources. That's a wonderful puzzle that is different every time.
Jeff Kavanaugh: It's a nice play on words, Greg's List. Let's dive right in. Those eight North American cities, you're not focusing on Silicon Valley. So, can we talk about where you've gotten to, with this whole cataloging and indexing of these task companies.
Greg Head: So it actually started in Phoenix where I spent 23 years, mostly in fast-growing software companies. And five years ago, after the last one, I grew two companies to 100 million in Phoenix, and one more before that. I just started helping all my friends who were running software companies. And outside Silicon Valley, in Dallas, Atlanta, even Austin, Salt Lake City, Phoenix, people say there's not much going on in software. You have to go to Silicon Valley for software and venture funding. And it's certainly a different place. I've lived there, worked there. There's a lot going on in Silicon Valley, but there's also a ton going on outside of Silicon Valley in regular cities, in between New York and San Jose, San Francisco. So in every city, there are software companies, and these are not just software services companies or companies that use software. These are companies that make their business in the commercial software industry. Phoenix, nobody thought there was much going on in software other than a couple of companies we grew up. But actually over the last few years, I found over 600 software companies there.
Greg Head: And I became the connector, “Hey, investors,” investors were asking me to connect them, and founders to investors and job seekers and so forth. So I just published the list as a volunteer project, and a public service to the community of the software freaks that I knew, the entrepreneurs, because they were all saying, "Where's the money? Where's the talent?" And everybody was doing that. So now it's actually up to 11 cities, three cities here in Texas, Dallas, Austin, and Houston. Yeah. Silicon Valley is still king, but there's a lot more going on outside Silicon Valley. And for example, there's 650 software companies in Phoenix, Arizona that employ 50,000 people. More people are employed in the software industry in Arizona than in the golf industry. You just can't see them. They don't have their names on their buildings yet.
Jeff Kavanaugh: Can you characterize any differences in philosophies from these founders who aren't in Silicon Valley, or there's some common threads?
Greg Head: Yeah. There are some common threads in Dallas, Phoenix, and Denver, Chicago that are different than Silicon Valley. And each one of those cities has hot startups that are growing fast, becoming big brand names, and getting classic venture capital funding, but that's a small minority. And so the difference is, outside of Silicon Valley, a few things are happening. There's a lot of B2B software companies that are bootstrapping, getting into revenues without raising capital. And over 50% of companies, the 5,000 companies on Greg's List at GregsList.com, in those cities, those 10 cities outside Silicon Valley, don't have outside funded, and something around 63% have no funding or light funding from angels. So VC funding, the traditional high growth game, which is still valid and still works, is actually for a minority of software companies even after the startup stage.
Greg Head: So another trend I would say that makes that possible, bootstrapping and capital efficiency to grow, is industry focus, which wasn't a thing in Silicon Valley, but in the last 10 years, half of the software companies on Greg's List are industry-focused, just for healthcare, just for veterinary, just for software companies. And so they're easier to get up and running, and to grow efficiently in their more narrowed markets. So that would be one thing. I think there's more practical growth aspirations, and that's completely valid. It doesn't have to be Zoom and something universal and horizontal to be successful for founders and the customers that they serve.
Jeff Kavanaugh: Yeah. It's almost like it's the adulthood of the software industry, all these mature niches start to, profitable niches, that might not make someone rich immediately or grow quickly. And yet, they're good, viable businesses.
Greg Head: Yeah. I would argue that everything started as a niche. Video conferencing and podcasting started in the corner and now it's universal, but I would argue that the best way for entrepreneurs to create wealth is to fight a battle they can win in a market that they know well, and do it with efficient capital. I see more founders reaching true wealth through focused markets and capital efficiency than I see currently, through, it's for everybody in the broad, horizontal market with aggressive venture capital funding. And for the first 20, I spent my years in the venture funded software industry. That was the way you did it. You couldn't do it really any other way, but there is another way. And in many ways, it's the better way to wealth for founders than over-funding.
Jeff Kavanaugh: It reminds me of a book called The Millionaire Next Door, shattered the myth of the classic very wealthy person with the Rolls Royce, the private jets, or these trappings of wealth. You'd find that the average millionaire actually had a Ford F-150 or they had a certain lifestyle or they were in a house for a long time. So it's interesting over time, if we see that these software leaders are no longer the Jack Dorsey type of folks, and you more have this breaking the stereotype.
Greg Head: The stereotype is actually wrong. It's just the survivor bias and the media coverage. We only hear about the ones that go public and that everybody uses and so forth. We don't hear about the little guys who are probably making, on average, actually a better odds of making wealth for their founders. We just don't hear about them, successful companies in every niche of the software industry. And by the way, everything started in a niche, whether it was operating systems or the rest. So I think the VC industrial complex, meaning media and the conferences and everything, have wrongly told founders there's one way to do it. You have an idea, you get angel seed funding, series A, series B, venture funding, and that's the way you do it. It's actually the way that 10% of software companies do it. And it has to have certain dynamics, a certain founder, a certain market, a certain timing, certain culture to make that game go right. And that's not the right game for most software companies. So knowing what growth game to play and how to play it, there's actually more options now than there ever were.
Jeff Kavanaugh: Are you involved in the so-called crossing the chasm phase or is it even before that, where they're trying to get to the point where they're at the chasm?
Greg Head: Yes. I mostly deal with new category creators, or they're moving around an existing category. It's not another one of those for the same crowd, another way, right? Adding to the pile, they're kind of first to the race or subdividing a segment of that race. So they're playing the category game and that product adoption curve, crossing the chasm and so forth. And I know Geoff Moore was on the board of Infusionsoft, and I read his book dozens of times in the nineties and realized that the sport's changed there. But I actually deal with both. I have conversations every week with founders that are mentor conversations with founders that are getting on the field, starting their game, thinking about an idea, getting into market and so forth. On my consulting and advising side, I help companies that are probably between one and 10 million where the game changes. You're shifting from startup experiments to building the scalable factory. And that's where investors may or may not come in, but that's the turn there.
Greg Head: So I'm dealing with both. In the early stage, it's my whiteboard against theirs when they're just starting up. So I give them practical ideas and tell them a little bit of what's headed down the pike and connect them up to the right folks. But the problem changes once you've got 20 employees, 50 employees, investors, multiple markets, big competitors, and you're making the turn between a newfangled idea and something that looks normal in your market. So you and I are old enough to know that most of the things we're dealing with now that are technology didn't exist 20 years ago and they all went through the same process. That's a law of nature. It cannot be defied. When it's a brand new thing, your mom doesn't use it yet, it starts in the corners, then it goes out from there. And so you could argue that one of the things I do is help companies cross the chasm, go from crazy startup idea that's used by just the freaks in the corner of a market, to something that's more mainstream and scalable.
Jeff Kavanaugh: I was doing some research. It turns out, just around upstate New York, there were 300 camera companies early in the century, the last century. And it's just amazing whether it's that, whether it's radios, whether it's the automotive, the sheer number of companies that quickly consolidated, through acquisitions or people going out of business. And as you're looking at companies, what are the critical success factors to get from that 20 employee, million or two of revenue, to go to that next level? What is it that allows you to get to that next level where a lot of companies fail?
Greg Head: Well, in the startup world, they don't have the complexities of big business and they really don't in software and tech. They don't have a lot of operations yet. So it isn't the scale and brute force and operations excellence of big companies yet. And it may or may not be funding. So the ones that in early stage of a market, there's an explosion of little guys. And then when the markets are mainstream, there's few, there's the number one, two, and three. That's a law of nature, happens in every market. Politics, music, food, consumer products, tech, business to business and everything else. So in that turn, they actually have to go from selling to friends and running the experiments and doing things that don't scale, which is creative art that is required.
Greg Head: But it's not what you do. They have to go to a more marketing driven business, meaning customers are lining up. There's a repeatable flow of customers and it's a completely different game, but they actually have to make the shift there. And so how do you market to something that's new fangled? Well, you get the flywheel going, but you have to go up the stairs to get people to line up for things that they didn't line up for before. So that's kind of a magic trick there.
Greg Head: The second thing is, in tech, in any of these startups, the product has to be amazing enough to create the momentum that this new thing that people didn't use before do, we get excited about it, whether it's electric cars, or quinoa, or it plays out in the political arenas as well. It starts in the corners and that product market fit, which is not just product and market. It's amazing for a small company and that amazing excitement, explosion, the fireworks coming out of that corner is part of the required acceleration from companies to go from, "It's a newfangled thing," to, "everybody's doing it." It actually has to be amazing enough. And so product market fit is underestimated probably by about 10 times. You think if you've got a product and you got some salespeople, you can do it. Well, everybody's got that. The bar is much higher.
Jeff Kavanaugh: Product market fit. I go back just for a second to the first one. You said they have to climb up the stairs and get people lined up. Does that follow the product market fit?
Greg Head: You're kind of adjusting as you go. One of the most difficult things, and it's completely not obvious, is when you get out in a market and start a new podcast, you get something out there and you have a multiple audience, you're trying to find somebody to sell to and make payroll and do all that. So you actually kind of run your experiment set pretty wide, but the growth game is, ironically, when you narrow in and double down on the group that is the most excited, gets the most value, tells their friends the most, and so forth. So that's a universal magic trick that happens in every single growth company. The beginning of Infosys was a bunch of experiments. And then its mega growth years was pretty much doubling down on one or two categories, just like Amazon, could have put anything in a box and they looked at it, but it was just books.
Greg Head: So that acceleration gets people to line up. And if you look at things that people are lining up for now that they didn't line up for a few years ago, we look around and say, "Is that product really amazing? Is it really true?" We're very skeptical about the new things we add to our list. And we all wait until the water's fine and then we jump in at whatever level is appropriate to us. So yes, product market fit and those stair-stepping of the changing of tactics, it's a complicated dance. That's the part of the startup game, more so than building code or operational, or just-add-funding. That's actually the most critical factor in it.
Jeff Kavanaugh: I didn't hear you talk about talent or people, finding the next level to help you. What about the people side of things?
Greg Head: Before operations, there's people, so startups are more about the people than the process or the scale, their operational excellence and so forth. It's that kind of artistic mad science experiment. Talent is really important. And it's one of the things that founders told me when I was in Phoenix. One of the reasons I created Greg's List, they're saying, "I need a VP of sales who's done auto software at this size. Do you know anybody?" Right? So talent's a really important part of it, starting with the founder, they kind of have to be built for the game they're playing and then they find other people around them that can help them solve the whole problem. So I do a lot of connection between talent. We promote jobs and talent on Greg's List, and you have to find people who are similarly crazy to you to say, "Gosh, I totally see this. I think the world should change. I'll join in. I'm best at this. I'll help you over here." And it's part of the chemistry experiment that's happening in startups.
Greg Head: There's talent everywhere. So there's not as much engineering talent or experienced startup talent in Kansas City as there isn't Silicon Valley, but there's still talent everywhere. By the way, Silicon Valley, I was there in the nineties. We were all making new talent happen, it didn't exist before, and we grew it. So you can grow talent and find it. Talent's still important. And it's interesting how it changes as you grow.
Jeff Kavanaugh: Looking back a little bit, I wanted to cover one more thing on the whole, getting the VC versus your cashflow. Another way of looking at it is the money coming in. We both grew up in a world where you shrink wrapped software and sent it. Now we're in the SaaS model, software as a service, or any X as a service, anything as a service. Does that make it easier to be successful in software? Harder? Or change the mindset to more of a cashflow than the other? Can you talk about what SaaS means?
Greg Head: Yeah. SaaS is the recurring revenue business model. So there's a business model now with business to business software and a lot of consumer software, where it's paid for by the month, as opposed to paid for upfront, which was nineties, when you bought packaged software and paid for it upfront, when you licensed business software, Microsoft servers and things like that. Now it's AWS. You pay by the drink, or it’s Salesforce.com, you pay per user per month per features and so forth. So it's fundamentally changed the mindset of the software industry as opposed to “sell it and see you later,” a business cannot grow unless customers are happy. A SaaS software, software as a service, business cannot grow unless companies, their customers, are happy and continuing to pay them and stay. And generally speaking, buying more. You do not have a growth business if you can sell to somebody and they don't stay in the SaaS business.
Greg Head: So the incentive now is to get happy customers, get them using the software, getting to a value that's extraordinary and expand on that. So kind of changed from the model from the front end of selling first, where all the power was to, in the modern SaaS software, it's the product and the experience and the customer success that's the biggest thing. And so sales is important and marketing's important, but you have to have something where people say, "This is amazing. I'll keep paying for it." In the COVID year of our COVID crisis in 2020, in startup land, we got to see which startup software solutions were critical. And companies said, "We have to keep paying for this and we'll buy more," and which software solutions were not critical. And they say, "We don't really need this. We can cut it." So you got to keep making the cut in the SaaS software world. So it puts the emphasis on customer success versus software sales.
Jeff Kavanaugh: The Knowledge Institute's done a fair amount of research on medium size, large companies, how to compete with the so-called digital stars, compare and contrast. And one of the interesting areas are these platforms, be able to quickly launch. We call them “digital runways,” and the shared digital infrastructure that a small outfit or a team can quickly launch and grow a business. You see it in Amazon, you see it at Google, we see it at Facebook, Apple, and a lot of the companies we work with, whether it's clients or just people who are consuming our research, that's something they really thirst for.
Jeff Kavanaugh: What could a corporate larger company do to embrace the SaaS startup concepts and maybe grow themselves?
Greg Head: You can't play the same innovation game that a little tiny startup can, which is experimenting for two years, not making traction until they find the thing, operating in the little corners, dealing with small numbers first. It's hard for big companies to throw money at it and experiment and give the space to play the game there. And so just that scrappy startup thing, that, by the way, 90% of startups don't make it big, so the experiments are getting cold in the startup process. So it's hard to play that go off and experiment game inside big companies. So I wouldn't recommend they play that.
Greg Head: The converse of what I said earlier is that it's easier to start a software company and there's a lot more bootstrapping or efficiently funded companies, there are opportunities that actually take investment and scale and industry presence, and data. The leverage is, levers, of bigger companies. So that's generally how I would say that big companies can compete. They can start with the scale, a large customer base, the data, the infrastructure, and so forth. The kinds of things that a scrappy entrepreneur can't build on his own for a million dollars or something like that. So the lesson for both entrepreneurs and big companies is you think you know the answer, there's a market problem, you want to jump in there, it's going to take longer than you think to get there and to run the experiments and to find out what scales and keep going, so just have the patience on both sides. Entrepreneurs are impatient, and the ones who have succeeded are the ones who've been doing it for a long time and got through the game, didn't die along the way.
Jeff Kavanaugh: That is something that we've seen, that people are carrying the lunch pail to work. They're doing the hard, hard yards, but there is an impatience and a sense of extreme urgency, whether they're in a large company fearing for the next Netflix over their shoulder, or a small company, thinking they'll asphyxiate with lack of funding. Can you talk about how to channel that aggressiveness or impatience into positive output?
Greg Head: It's something I have to deal with, with founders. This is not just a whiteboard exercise, innovations over here in big companies, and then you do this. It's a real game. The little bootstrap companies have to survive. They have to make cashflow. They have to sell something. Otherwise they don't get the right to keep going. So survival is real for big companies and for small companies. And that innovation experiment game is also required in real. "We're going to do 10 big things this quarter, add these features, try this marketing campaign…” They're not all going to work and the game is going to change as you do it. So you have to survive long enough to scale.
Greg Head: One of the reasons I advocate for most founders who are just getting into the game, getting a little traction and revenue, to not raise too much money, because that creates more impatience than the cashflow game. You can be lean and you can hang out a long time. It's hard to kill a little software company. But if you get funding and you don't grow to those expectations, right? You'll get a bullet. You know, serious funding, institutional funding that requires growth. And that's generally a more impatient member of your team than keeping your service business going while you run the experiments to get your product business.
Greg Head: So, it actually is an advantage for large companies. They actually have a day job and a real business over here, and they could spend money and run experiments, but they're not used to running experiments and saying, "None of those things worked this year. We'll try again." Right? You're just not used to running those experiments. So it's just a mentality of innovation. I've talked to over 2,000 founders in the last five years and everybody has their vision and their growth game. And it's always harder and takes longer than they thought for the smartest ones. It's never easier. Still looking for an entrepreneur, most savvy, most funded, that said, "It got there faster and easier than we thought it would." So having the patience to run the experiments and still play the game and not run out of cash is a big deal.
Jeff Kavanaugh: Right. So that's a real nugget. It's taken longer than even the best from working with 2,000 of these entrepreneurs. What are some other nuggets or insights that you can share, especially that made the difference?
Greg Head: If I could put one billboard out there that entrepreneurs and starting, if you're starting something, in a medium-sized company, big company, starting a new category of music or whatever, is if you want to be big, you start in the corner. Nothing ever moves fast in the beginning, being everything to everybody. And we all look at everything to everybody companies. Infosys does a lot of things for a lot of people now. Amazon does a lot of things for a lot of people, but if you go back to the beginning, they did one thing for one crowd, and then that's where the acceleration comes, and they could have done anything for anybody. It’s not obvious and it's counter-intuitive. Jeff Bezos looked at 17 industries of things he could put in a box and he chose just books. And he didn't say anything about those other boxes until five years later, where he totally dominated a market and he just started adding slowly.
Greg Head: That's a universal law. It cannot be defied. I've never seen it defied. Show me a big company. I'll show you it in their growth spurt. They were the best, known as the best, at something important for someone specific. And it wasn't obvious, it looked crazy at first, whether it's McDonald's hamburgers or Donald Trump or Facebook, they started in the corners. And so what is that corner? Is the start-up question, where you can have the most product market fit, the most acceleration. And so it's just really hard for entrepreneurs, everybody else to say, "But we could do it for everybody." Focus is the answer. Specialization is the answer. And when you say things like niches or the rest, everything starts out as a niche, whether it's hamburgers. Hamburgers are 50% of the fast food industry in the United States and it started out in a corner. So it's always crazy in the beginning. And so how do you make it less crazy? You start in the corners and you get undue leverage by focusing.
Jeff Kavanaugh: What is one thing that large companies aren't aware of that is essential for them to be able to do this going forward, to take advantage of SaaS and to create these new offerings and capabilities that they might be overlooking?
Greg Head: Other than buying companies that are in their space, right? That have already gotten up by the final winners and adding that to their quiver and making those changes. If they want to really get started in a new market, they have to be a lot more comfortable with the crazy experiments, not knowing the answer, and taking more time to get there. That's just the nature of the startup world. 80% of these companies are not going to make it big. And most of the experiments are not run.
Jeff Kavanaugh:So to get more control of your future, accept less control.
Greg Head: Yeah. And put it in a corner, right? Don't screw up your day job and your main business and your Six Sigma and the real factory. But you actually have to give space to crazy people to run the experiments. And many of them are going to be threatening to your current business. And that's a challenge. I totally get it. That's why large companies struggle with innovation. What's a large company that doesn't struggle with innovation? Look at Amazon. They give space. They give time. Jeff Bezos calls it “the wandering,” right? You don't know the answer yet. There's something over there. We don't know the answer. We're going to try a bunch of stuff. And it's hard for entrepreneurs who think they have the answer, but they just don't die to be able to create something. They actually had the space to go run a bunch of experiments. And anything that's new is running experiments. Startups are experiments.
Jeff Kavanaugh: Speaking of startups, what's the one thing that either someone in the trenches today that's trying to get a software company going, or even that business school or engineering student who is trying to tinker on the side and really wants to launch, what is one thing that you'd leave with them to give them something to think about?
Greg Head: Other than, it's going to be way harder than you thought. It probably won't work, but there is a chance. That's what all of us are doing in this game. Generally speaking, it's, don't quit your day job until you've run the experiments and you've got the flywheel going in your new startup. Most people think they have the idea. This is related to lean startup concepts and other things like that, that were around before that. It's not as obvious. The bigger trick is not making the software. It's getting customers, revenue, and growth that's consistent. It's hard, but it's not the hard part of a growth company. Getting customers, revenue, and growth, consistently and ongoing, is the bigger challenge for almost all startups and software companies that are getting growing.
Jeff Kavanaugh: You talk about the scaling point system. What exactly is that?
Greg Head: Well, it's like I said, it's laws of nature. I didn't create any of these, but it's just really hard to see when you're in the firefight running a company. Most founders in startups and early stage companies, it's a race, it's tactics, it's survival, it's experiments. So it's adding sales people and culture and talent and email and systems and all that stuff that takes up the day. More of everything until it doesn't work. That's one of the reasons they hit a plateau, something deeper is going on. And the scaling point system is a universal strategy framework that takes in a little bit of positioning and product market fit and all of that, and very simple so founders can see it and they can make a strategic move to create specialization and focus, either in what they deliver or who they serve or how they do it. So that's where the growth game in the long run is built. It's not emailing harder or adding salespeople faster.
Greg Head: It's accelerating with the right customer, doing the right things, even though you could make anything, you could sell it to anyone, you could be anything. Acceleration comes from that one crowd and that one thing for them that is amazing to them. And so that's the challenge in the middle of the firefight. So the scaling point system brings that out and creates the marketing leverage that they need to keep on growing.
Jeff Kavanaugh: How do people find you online?
Greg Head: Well, the simplest way is to go to my website, GregHead.com, G-R-E-G-H-E-A-D. And you can find my LinkedIn and learn about Scaling Point and see, you can go to GregsList.com and find me there. And I'm on LinkedIn as well so people can connect with me. And if there are founders or leaders that are dealing with these kinds of issues, they can reach out to me and we can have a quick call. That's where Greg's List came from, is I was having hundreds of whiteboard discussions and mentor calls and deep coffees with hundreds of entrepreneurs and realizing there was way more of them than anybody else could see. So I’d enjoy meeting and offering perspective to entrepreneurs who want to reach out.
Jeff Kavanaugh: Yeah, it's an amazing list. I think, especially if you live in one of those cities, you just don't realize the depth and breadth of tech talent around you. You can find details on everything we talked about on our show notes and transcripts, at Infosys.com/IKI in our podcast section. Greg, thank you so much for your time. Very interesting discussion.
Greg Head: Thanks Jeff. Pleasure to be here.
Jeff Kavanaugh: Everyone, you've been listening to The Knowledge Institute where we talk with experts on business trends, deconstruct main ideas, and share their insights. Thanks to our producer, Catherine Burdette , Christine Calhoun, Kerry Taylor, and the entire Knowledge Institute team. Until next time, keep learning and keep sharing.
About Greg Head
Greg Head is a 30-year software industry veteran who was part of the startup-to-scale journeys of three different software companies in the CRM industry, including one IPO. He is now an active mentor, advisor, consultant, and speaker helping founders of early-stage software startups all over the world.
His consulting company is Scaling Point where he works with startup tech founders on positioning strategy, product-market fit, messaging, and scalable marketing execution. He is also the founder of Gregslist. Gregslist.com is the curated and up-to-date list of local software companies used by thousands of founders, tech leaders, investors, and job seekers each month. Gregslist is now available for tech communities in Phoenix, Salt Lake City, Dallas, Austin, Chicago, and more cities.
Greg and his wife live in the Dallas area. They spent 23 years in Phoenix before returning to her Texas hometown in 2019.
- Connect with Greg at GregHead.com
- Connect with Greg on LinkedIn
- Scaling Point
- GregsList of Local Software Companies and SaaS Jobs
- Twitter CEO Jack Dorsey's Life of Luxury Business Insider Oct 29, 2020
Mentioned in the podcast