One of the most important steps in every entrepreneur’s journey is deciding on your line of business to, subsequently, build it from the ground up.
A lot of entrepreneurs go into their fields already knowing what they want their business to be about, but several others struggle to find their niche. We belong to the former group: in our case, the business idea behind efficy came very naturally.
How to create a business from the ground up?
I founded efficy in 2005 with my business partner, Robert Houdart. We both already had experience in the field and, back then, what we got from the market was that there was a high demand for customization in CRM systems.
Customization is something that every company needs because the CRM is often linked to who they are as a company – and especially, how they handle their clients. However, on top of that customization demand, the update possibility was often costly: a company would spend a lot of time and money in customizing, but then it would be very expensive to upgrade their software. This is the problem we saw in the market and said, ‘ok, we need to fix that’.
For the first version of efficy, we developed the technology needed. We wanted to ensure that, as much as we had high customization, we could also upgrade quite easily. This is the idea behind the first version of our product, as well as why we started the company. We started fully as a SaaS business – a web application business — which was not that common back in the day.
The logic behind our Business Model
From the start, we really wanted to focus on building a long-running relationship with our customers.
A way for us to do that was to propose the SaaS or ‘renting’ business model of the software instead of the ‘classic’ model (which, back then, meant licenses + maintenance costs). We really wanted to push the SaaS to make sure we were aligned with our customers’ objectives and that we were working towards satisfying them.
Unlike in a licencing business (where you simply sell the license and that’s it), when you’re in SaaS achieving customer satisfaction is more difficult and gradual. If for any reason you don’t succeed or if the customer is not satisfied, you lose your sales efforts. To have a recurring business was our goal and idea since day one.
Then, the time came for us to build our team. Our first hires were basically the people who wanted to come with us! In the beginning, it’s not about you handpicking the ‘right’ people; chances also are that you don’t have the budget to do so yet. I often used to joke that if the person was on time on the interview, they were pretty much hired!
Back then, unlike our recruitment processes now, we didn’t do any technical or personality tests before hiring. We were small, and the most important criteria for the start-up was to find people who were ready to work and grow with us, and who were willing to take on a broad spectrum of tasks. We also tried our best to get a cultural match – to find people who worked similarly to us and who shared our values.
When it comes to your business plan…keep it simple!
When it comes to creating a business plan, I’ve always thought that it’s best to keep it grounded.
In efficy’s case, we built our business plans thinking of achieving them in the mid-term and with realistic objectives, taking into account the time and strategy, which resources we need to hire to get there, and so on. Also, later on in the development of the company, I tried my best to involve the top management team into the creation of the business plan. That way, the whole team will try their best to accomplish the goals we set, because they all stand by the plan and believe in it.
Putting together a realistic yet ambitious plan is key for entrepreneurs and companies. Everybody wants to rule the world, but unless you’re able to align your stakeholders it the right direction and take it one step at a time, you won’t get there.
It’s important to be able to have that plan and to measure where you are, always keeping in mind that there’s always a big difference between the plan and the journey.
What do you think are the main challenges entrepreneurs face when it comes to creating a business? How did you tackle said obstacles at the start of your entrepreneurial journey?
Let me know in the comments!
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If you’d like to continue on this journey, check out these stories:
- Blog 4: Lessons Learned
- Blog 6: Knowing your strengths