Bizo’s Journey to MVT
May 22, 2019
PUBLISHED BY Wildcat Venture Partners
Wildcat’s CEO Interview Blog Series features in-depth interviews with CEOs who have successfully traversed The Traction Gap®. In each blog, we focus on the CEOs’ experience during one phase of the Traction Gap journey.
We sat down with Russell Glass, founder and former CEO of Bizo, and now CEO of Ginger, an on demand behavioral health company, who shared his experience successfully getting to Minimum Viable Traction (MVT).
A simple way to think about MVT is Minimum Viable Repeatability (MVR) plus multiple quarters of growth. This is the point in a company’s maturity – indicated by a certain level of revenue growth, engagement, downloads, usage or other metric – that demonstrates market validation and signals a positive growth trajectory.
Wildcat’s Traction Gap Principles at MVT
- Product: Prioritize removing technical debt over new features.
- Revenue: Refine pricing models, customer acquisition strategies, hire sales resources slightly ahead of demand.
- Team: Deliberately construct a high-quality board—and advisers.
- Systems: Implement advanced front and back office systems.
When a company is closing in on MVT, marketing matters. This includes, content marketing, and digital and online presence. “We would produce 45 pieces of original content a month,” said Russell, “and that would be sliced and diced in a whole bunch of different ways. From Twitter to Facebook to SEM and SEO, to ads, etc. So, we were driving a ton of content for the top of the funnel.”
A big thing Russell learned when Bizo was on the way to MVT was the importance of exclusivity with regard to providers. “We signed up all data providers— our supply chain —on an exclusive basis. We got away with that because we gave them 30-day ads at any time. If you weren’t happy with what we were doing with you, you could leave. But we don’t want you reducing the quality of this data by selling it to a whole bunch of different people at the same time. So that’s how we would pitch it.”
This didn’t feel like exclusives to publishers, even though it effectively was. “We thought that allowed us to have some decent tie in. As we started cutting them checks for their data it would be harder and harder for them to leave us for somebody else who tried to convince them to sell them their data also. It turned out to be exactly right.” Competitors couldn’t offer the same guarantees, and Bizo held on to their clients—they only lost four data providers.
“A lot of people don’t think they can get exclusives. But if you structure it in the right way, or if you understand the give and takes of the deal you’re doing, it is more possible than people think,” said Russell.
Another important strategy was how they approached their data product and utilized channel partners. “That channel model,” said Russell, “not only was it very high margin for us. But there were thousands of sales people out in the channel using our name. They were saying great things about our data, because they needed to close deals themselves.” People said Bizo would cannibalize revenue, but Russell found the opposite: “It drove our business and it drove awareness of who we were in a pretty significant way.”
“The lesson I took away,” said Russell “is don’t just shut an idea down because of channel conflict. Really dig into the dynamics of the business you’re in. There’s always channel conflict of some sort in a fast-growing business. Sometimes it’s actually a positive thing for the business and sometimes it’s not. Make sure you dig into that. Don’t just automatically think it’s a bad thing.”
Bizo also experimented with platform partners. They partnered with a marketing automation application for a while and became dependent on them to deliver the value. This dependency got tricky when Bizo’s success became limited due to the size of the application’s market, so eventually they built something on their own. “It wasn’t nearly as complicated as we had imagined from the outside,” said Russell, “We made a marketing automation system for advertising.”
What did Russell learn from this? “Never depend on anybody else for your success. Don’t have a partner that controls your destiny. When we recognized that the focus was going to be too tight to go to the big market, we very quickly got all over it and built the capabilities we needed to be independent.”
The team that will get you to MVT may not be the same as the team that got you through the earlier stages of the Traction Gap Framework. “I think we kept a couple of people longer than we should have. As the company grew, someone who was really successful in that zero- to ten-million phase, had a harder time being successful at the 10- to 30-million phase. But you just feel this loyalty to them because of that success that they drove in the early days. Even when you see they are really struggling. They are great culture fit, so you kind of work within that construct, even though in your gut you know this person’s in over their head now. As a leader, I’ve struggled with that.”
This doesn’t necessarily mean you have to fire, Russell explained. “Maybe it is the right call to keep them. But the question is: How do you keep them in a way that it doesn’t adversely affect everybody else? And adversely affect someone else’s ability to be successful? And that’s where I haven’t completely nailed this down. But I think what I’ll do is try to figure out how to put these people in roles that are exciting and interesting, but that don’t necessarily get in the way of other people’s success.”
CEO Takeaways at MVT
- Appear bigger than you are by generating an abundance of high-quality content marketing content.
- Strive to sign exclusives with your suppliers. It keeps competitors away.
- Don’t write off a channel partner strategy; leverage it to bring in both revenue and brand awareness.
- Be very careful about relying too heavily on a single platform. Don’t have a partner that controls your destiny.
- The people that get you from $0 to $10M aren’t necessarily cut out for the stage after.
- You don’t necessarily have to fire people who can’t scale. Think about how to fit them into new roles that work but be prepared to let them go if they really don’t fit anywhere.
Bizo is a marketing platform enabling B2B marketers to identify, reach and engage their target audiences online. Bizo was acquired by LinkedIn in 2014.