(Still image from Glengarry Glen Ross)
Where there are startups, there are events. Lots of events! There are events for entrepreneurs, product people, marketing, BD, hackathons, you name it.
But what about salespeople? No events for salespeople!
Salespeople are often underappreciated and viewed as half-intelligent meatheads to most people. But ask any serious entrepreneur and he/she will tell you that a good salesperson/sales team are one of the most crucial elements of an organization’s success, especially at a tech company.
That’s why FastPay, along with LA startup TaskUs, decided to throw a sales event - Startup Cinema: Sales Movie Night. The idea for the event was simple: show a classic sales movie, Glengarry Glen Ross, to get the crowd fired up, and then have panel with 3 of LA’s top sales pros share some tips and insights.
Our panelists were Kevin Gaither, VP of Sales at uSamp and guru of Inside Sales; Brooke Partelow, EVP of Sales at Bounce Exchange and veteran of making it rain in tech; and Dennis Velasco, Head of SMB at Conerstone OnDemand, aka the guy who builds companies within companies. Our moderator was none other than Aaron Ross, author of Predictable Revenue, and if you aren’t familiar with Aaron Ross and his sales teachings just know that your company is probably generating half the revenue it could be. Stomach that or go buy his book.
Since the audience was filled with salespeople working in tech or trying to break in, the panel shared what the people wanted to hear: Why work in sales at a startup? How do I advance my career? How do I pick the right startup and how do I get in? How can I go from salesperon to another role at a startup - BD, product, marketing?
The audience loved it.
Some tips from the panelists:
Why work in sales at a startup?
You can more easily see the impact your sales efforts while working at a startup. Why? Because, as a salesperson, you’re the one in the organization on the front lines interacting with customers and directly impacting growth. You have the opportunity to learn more about the customer than anyone else, and learning about your customer is the single most important thing a startup can do.
How do I advance my career in sales?
Keep detailed notes on your results and the results of each and every team member, and use this knowledge to figure out what works and what doesn’t? The information gained from progress made (or not made) will be crucial in building a team and scaling your sales process. It’s also information that other companies will want from you.
These gems and other key takeaways from FastPay’s Startup Cinema Presents were invaluable advice to me, as a salesperson myself, and a member of the FastPay team. On behalf of the entire sales team, I would like to extend a thank you to TaskUs for co-sponsoring the event and letting us use their movie theater. And a huge thanks to all the panelists, and to everyone that showed up.
We’ll see all of you rainmakers at our next sales event!
— Aaron Elharar
Account Executive, FastPay
Last week at the Gaming Developer Conference (GDC) in San Francisco it wasn’t hard to spot the dominant themes throughout - mobile & monetization. As videogame giants start to adopt mobile and freemium models it has become apparent that mobile and social gaming are officially a part of the mainstream.
The Gaming Report recently released by App Annie & hardware research firm IDC states that iOS App Store and Google Play game downloads combined have eclipsed dedicated handheld games in consumer spending in Q4 2012. As a result, independent developers are sprouting up left and right to try and capitalize on the demand for this type of mobile entertainment.
Ad operations companies have tried any number of methods to help drive monetization but from what we heard from the developers we spoke with at GDC, they receive daily sales pitches from an array of ad firms who all have strikingly similar product offerings (maybe same-day payouts would be a way for them to distinguish themselves from their competitors?)
With this new focus on mobile comes a new set of challenges for both independents and ad ops. Ad operations businesses are adapting to the ever-changing marketplace while having to simultaneously deliver results. While developers face excruciatingly long payment terms (45-75+ days) paired with the upfront costs of running a successful business.
These findings are not surprising to us at FastPay. We’ve seen a serious uptick in inquiries from this segment of the market. This industry is just getting started with some major growth ahead which also means major cash flow challenges as company’s scale. Are you a game developer and deal with late payments that impact your ability to do business? Give us a call (310-651-9200) to learn how we can help you grow.
A story that published to WIRED late last week has both intrigued us and got us thinking wtf?
This story was titled Meet the Man Who Sold His Fate to Investors for $1 a Share and it circulated around the web like wildfire. This true story chronicled the life - controlled by shareholders (investors) - of Mike Merrill, a man who at age 30 broke his life down into shares and sold his entire existence to stockholders who would claim ownership of almost every decision he had to make. This group of shareholders was made up of family members, girlfriends (ex)girlfriends, and total stangers buying and trading Merrill’s stock after an IPO; This is not an April Fool’s joke, this is real.
We couldn’t help but draw parallels between this ludicrous scenario and that of entrepreneurs and their startups when it comes to taking an institutional investment over bootstrapping or an alternative lending solution. It wasn’t long before the story revealed that Merrrill quickly learned the downside to taking on outside funding, beholden to shareholders in ways he had never imagined.
As crazy as this story may be, and outside of the scope of reality it may seem, as the article reads Every year, tech-industry entrepreneurs make a similar decision. Taking on investors is usually one of the first steps in Silicon Valley’s well-established path to outrageous fortune. But at what cost? Tell us what you think, read the full story here and post your comments on our FastPay blog.
In a perfect world, startup founders would all have MBAs in Finance, be able to bootstrap their companies, and avoid dilution of shares like the plague. But that is not the case, nor is it a realistic expectation, especially among small to medium sized digital businesses where most specializations take a backseat to technology.
In this digital age, there is so much opportunity to create the next big thing, and we here at FastPay feel like business growth should not be limited or stifled by debt (although, sometimes debt can be a good thing. Stay tuned to the FastPay blog for more on that). That is why we are all about giving back to the entrepreneurial community by sharing what we know about startup finance.
Recently, our CFO, Mike McGlade, was interviewed by FinSMEs, a newsblog about financing for small and medium sized enterprises. In this interview, Mike shares examples of the type of businesses who use FastPay (web publishers, social marketing firms, app developers), and how they reinvest the working capital to stimulate their growth. Mike was also interviewed by web TV pioneer, TechZulu during South by Southwest. You can see that full video interview here and read the full FinSMEs article after the jump.
FastPay is a finance platform that provides lines of credit to growing digital businesses. Based in Beverly Hills, CA, the startup raised $25m in financing in 2012 (read here) and has already provided working capital to several companies. Mike McGlade, the Chief revenue officer, who previously worked at BetterWorks and Tellabs (NASDAQ: TLAB), answered our questions about the company, its product, and future plans. (continue reading)
Now that the dust has settled from SXSW, and we’ve washed the BBQ sauce off of our clothes, it’s back to the daily hustle and bustle of life at a startup. For many, South by Southwest sounds like one big party - and for many, it is - and like most parties there is usually a lot of noise, but it is possible to get serious business done (even without a badge!) if you have the right approach.
The ultimate goal here at FastPay has always been to give entrepreneurs easy access to capital so that they wouldn’t have to sacrifice their most precious assets: ownership and control. With this goal in mind, today represents a very significant day for FastPay and our customers, because we have officially crossed the $100 million mark in digital receivables lending. This means that over $100,000,000 of working capital gap financing has been put back into businesses to nurture growth, instead of in to fees, covenants, and personal guarantees associated with traditional lending options. Here are some really great articles about the news from our friends at PandoDaily and Forbes - a special thanks to both for your coverage of the big announcement!
We think this is a great time to be an entrepreneur, and the digital landscape is ripe with opportunity. We hope we have the opportunity to help you grow your business!
A few weeks ago, NerdWallet asked our CEO, Jed Simon to take part in their CEO Series of interviews featured on their blog. NerdWallet helps consumers save money and make smarter decisions about their personal finances, so naturally it was a great opportunity for Jed to provide some straightforward information about how FastPay can work for you. The complete interview is pasted below and available here. Enjoy!
Jed began his career in the Investment Banking New Media Group at Morgan Stanley & Co. in New York providing IPO, debt finance, and merger and acquisitions advisory services prior to joining DreamWorks SKG in 1996. During his ten year career at DreamWorks, Mr. Simon managed aspects of its finance, distribution, marketing, and new media businesses, and was a senior executive at DreamWorks Records before assisting in the sale of the company to Universal Music Group. His last position with DreamWorks was Vice President of International Distribution and Marketing for DreamWorks Pictures, based in London. Mr. Simon graduated Phi Beta Kappa from Brown University and is on the Board of Directors for Brown University Sports Foundation and is active with the Los Angeles County Museum of Contemporary Art and Big Brothers & Big Sisters of Los Angeles.
NerdWallet (“NW”): What is the role that alternative lending plays in the small business lending space?
Jed Simon, CEO of FastPay (“JS”): Historically, equity is the prevailing form of capital for small businesses. But equity is hard to get, primarily because banks are not progressive and they use traditional metrics to assess the viability of a business. Alternative lending sources allow businesses to get cash faster. We take 1-2 weeks to get you the loan—banks take 3-4 months.
NW: What is your typical client profile? Who do you usually lend to?
JS: Our typical clients are fast-growing businesses that are doing business with big brands (for example, Google). They’re looking for capital to expand but trying to preserve their equity.
NW: So because they want to retain control over their business, they prefer to work with you rather than seek venture capital?
JS: Right. If they use venture capital, then someone else will own half the company, and they’ll have to put them on a board of directors. We provide a very simple solution.
NW: How do you make these loans? Are you a direct lender?
JS: We are lending ourselves. We have our own sources of financing, but FastPay is a direct lender to small businesses. We’ve lent $100 million so far, and our average loan size is between $300,000 and $400,000. We’re helping these businesses grow quickly.
NW: Do you generally make one loan to a business as it’s starting up, or do you lend to the same business consistently according to their cash flow and needs?
JS: Typically, it’s not a one-off deal. Our average relationship lasts several years. We’re not just a quick fix. We are a permanent solution. If, say, the company has a fifteen million dollar contract that they get paid for every six months, and it takes a while for their client to pay them, we can lend them ten million dollars in the meantime. Then once they get paid the fifteen million, they pay us back. We charge a small fee, and our packages are very straightforward.
NW: How do you determine whether or not to lend to a business?
JS: There are 3 components we use to make our decision. The first and most important criterion is, who is this company is doing business with? We also look at the character of the individuals—are they seasoned executives? Do they have experience? Thirdly, we look at the business itself and what kind of business it is. This is the least important of the three.
NW: Why are you different from the other alternative lending firms out there, such as OnDeck, SpotLoan, Kabbage, etc?
JS: We’re all innovating in different spaces. We work with tech companies. ZestCash (now called SpotLoan), for example, gives loans to consumers. OnDeck loans to brick and mortar companies, like restaurants or grocery stores. Kabbage loans to online retailers. We all focus on different spaces.
NW: What kind of businesses does FastPay finance?
JS: We’re giving loans to technology businesses. Part of the cash crunch is that you’ve got these big brands spending a lot online, and businesses like our clients can’t sit around and wait.
We typically lend to four types of companies:
TODAY, the Harvard Business Review blog network featured a contributed article titled, ‘Lessons from a Failed Social Entrepreneur' written by FastPay’s very own Chief Revenue Officer, Mike McGlade. In this article, Mike offers up some excellent advice to social entrepreneurs or anyone with big plans to start their own business - traditional, digital and beyond. Mike’s expertise is time-tested and his insights are a valuable reminder that if at first you don’t succeed, try…and try again.
More after the jump…
HBR Blog Network (Harvard Business Review)
by Mike McGlade | 9:00 AM February 11, 2013
During my first year at Harvard Business School, I decided to start a new business. I set up a team, choose a name, secured a URL, and Zoosa was born. My theory was that by leveraging the collective expertise of skilled professionals, we could have a significant impact on the social sector. Zoosa was intended to be a platform where volunteers shared their activities and connected with others, creating a positive feedback loop. The idea was that this would encourage some people to deepen their efforts and others to become new volunteers. Unfortunately, I had never worked for an early-stage business or in the social enterprise space. The result? My business failed.
My story is not unique. Though we don’t often talk about failure in the social sector, I’ve seen numerous entrepreneurs waste countless hours working late into the nights and stubbornly plugging away throughout weekends. Even worse, many forfeit the opportunity to have a full time job in order to “follow their passion” as a first-time entrepreneur. They watch their social lives melt away at the same rate as their savings.
That’s what I did. And it took me 2 years to put a bullet in Zoosa. I pivoted from a skills-based volunteering website to a platform for corporate social responsibility to a third concept — you’d use Facebook for your personal social network, Linkedin for your professional social network, and Zoosa for your social impact network. Ultimately, I didn’t have the industry knowledge or the professional expertise to realize the vision. Eventually, I did two things that every social entrepreneur should do: set aside my ego and went back to step one — getting smart.
Here’s my advice for any social entrepreneur who’s decided he/she’s got the next big idea:
Put your ego away. How often have you heard an entrepreneur — or a want-to-be entrepreneur — say they want to run their own business? It’s almost as if they’re starting with the end point and working backwards. They want to run a business and so they look for an “idea”. Sometimes they’re clever enough to at least look for a real problem to solve — but not always. Instead of focusing on what you want to be or what you want to achieve, think about what it is that someone else truly needs. You and your ego should be beside the point.
Get smart first. Entrepreneurs-in-the-making are often convinced they have the next big idea for an app or product or service. Do they know anything about building an app? Well, no. But they want to run a business. So they dive in. They’ve heard from others that entrepreneurship is about persistence in the face of adversity. So they persevere, even when the market is giving them negative feedback. This feedback is especially tough to hear for social entrepreneurs. Failure may be doubly hard when the market is saying no, but the social need still exists. Getting smart requires you spend time in the field you want to run a business in. Volunteer or get a job working in the industry or with the clients you want to serve. Enduring adversity is important but without the right experience and exposure to the field, you’re unlikely to succeed.
Failure is not necessarily a bad thing but it has consequences. Consider how many nonprofits offer duplicative services or solutions, or early on learn that their original hypothesis is flawed. In all of those cases, the wasted time, effort, and capital only hurt the stakeholders — the folks the entrepreneur wants to help in the first place. Ego wins and stakeholders lose.
In the three years since I let Zoosa finally die, I’ve become an expert in building sales, marketing, and business development teams for early stage ventures. I’ve worked closely with several very successful entrepreneurs and investors and they’ve taught me a lot about everything from leadership to fundraising to recruiting. They’re helping me get smart.
I plan to go back into social enterprise, and maybe even run my own business. But for now I’m content to focus on my passion: helping entrepreneurs build their businesses.
Before you don the social entrepreneur title and dive into building your enterprise consider if you need more experience to realize your idea. If you do, set down your entrepreneur ego and find a job. You need to get smart to make a difference.
— Mike McGlade
Chief Revenue Officer, FastPay
No one said that change is easy. But given the changing tide within the publishing industry, retailers who want to stay ahead of the curve need to cushion their capital like never before as they transition into the digital media space. A recent article in the Wall Street Journal states that Amazon’s e-book business has become a “multi-billion dollar category” for the retailer, while December, 2012 marked the lowest month of sales for physical books yet. e-Book sales have grown by 70% indicating a very clear paradigm shift so physical publishers have no choice but to acclimate to the digital medium in order to stay relevant.
Publishers who were used to getting paid right away for units sold under the old agreements are now faced with the cash flow problems that stem from transitioning to an e-book model. Downloadable content such as e-books means instantaneous access for the consumer, but it’s the small-to-medium sized publishers that are paying the price. Many of them have shared with FastPay that they are now facing even longer payment cycles from distributors (Amazon pays net 30+ days) which forces them in to a difficult situation making it hard for them to stay afloat. There has never been a greater need to close the gap on payment cycles for these publishers, and FastPay is here to help you grow at a faster rate! Whether you are a publisher, developer or any agency that has payment terms of net30, net60, net90, or even net120, FastPay can help you get paid on day one.
Check out the most recent Q&A with our CEO, Jed Simon, brought to you by our friends at Startup Minds!
Have a question that didn’t get answered in the Q&A? Send us your inquiry and we’ll make sure to answer it for you!