Scot Wingo is co-founder and CEO of ChannelAdvisor, a public company in Morrisville, N.C. that helps e-commerce retailers optimize sales across channels. Wingo and team took the company public in May 2013.
Blake Callens from PencilBlue (pencilblue.org) asked our first question:
Status and Industry: Pre-revenue, bootstrapped, open source publishing platform being released this month.
We’re currently targeting web developers for adoption of the platform, with the aim of having them drive revenue through extension sales and partner programs (think an improved version of Magento’s revenue model, which I’m sure you’re familiar with).
My question is this: what has helped ChannelAdvisor with platform adoption outside of direct sales? What can we do to help bolster interest in our solution?
Note: to answer this question, I spent some time on pencilblue.org to get a feel for what Blake’s company is all about and recommend you do that too for background.
Blake, thanks for the question. First, I noticed on your bio that you are a Veteran of the 82nd Airborne Division. The reason we are able to have the freedom in this country to build great companies and pursue our dreams is due to the hard work and sacrifices of patriots like yourself. Thank you very much for your service to our country.
At ChannelAdvisor, we’re not Open Source Software (OSS) and our software is used primarily by the end users, not developers. That being said as you point out, there is an OSS e-commerce platform, Magento that has done quite well and we are very familiar with those guys. Also, at our first company, Stingray Software, we sold primarily to developers so it was a bit more like the platform you describe, so I’m pretty familiar with the challenge you face @ PencilBlue.
For readers that may have missed it, PencilBlue’s strategy is to develop and give away an OSS content management system for websites and the business model is to make their revenue from an extension marketplace (kind of like an app marketplace). This is the razor/razorblade type business model. Their differentiator is that they are an OSS platform plus they have designed the system to be address modern challenges such as responsive design. Responsive design creates a single website that works on any form-factor (desktop, tablet, smartphone). You can imagine that with 65% of time spent online coming from mobile (tablet/smartphone) this is a critical game changing differentiator.
Introducing: Startup Patterns
As I mentioned in my kick-off to this column, I have an engineering background and one of my favorite books when I was slinging code was called Design Patterns.
The premise of Design Patterns is that you tend to see similar problems in different scenarios and if you can identify those ‘patterns’, then there are certain code solutions that make great solutions to those problems. I think of that set of solutions as a playbook. Once you know the patterns, then your start to use pattern recognition to quickly identify that a problem matches a ready-made solution.
Similar to coding, after 20 years in startups, you start to notice patterns in the startup/entrepreneurial world as well.
When answering your question, it occurred to me that PencilBlue faces a common problem and it deserves a ‘startup design pattern.’ I’ll call the solution to your problem: Platform Evangelism Pattern.
The Platform Evangelism Pattern
In the old days of computing platforms (think Windows and Apple OS), companies spent hundreds of millions of dollars evangelizing their platforms. Today, with the advent of social media and a completely connected world, it’s a good news/bad news situation.
The good news is you don’t have to spend tens/hundreds of millions evangelizing your platform. The bad news is in today’s world, there is so much going on that it can be near impossible to get your message out there, let alone get folks to adopt your platform.
Here are six specific strategies within the platform evangelism pattern including examples relevant to PencilBlue that I think will help you tackle and overcome this hurdle.
Evangelism strategy 1 – Developers, developers, developers, developers
Looking at your blog and other site materials, I see that you are already well down this path. The key to building a platform is getting passionate early adopting developers on board. As you know GitHub has become not only a site to check-in and share code, but a complete community. Today’s top developers don’t really have a resume; they just point recruiters to their GitHub activity. Because of that, GitHub is the perfect venue for finding and recruiting developers for your OSS community. Once you have developers, you need to nurture them into a community (see section 6).
Evangelism strategy 2 – Draft off a giant
This essentially defines my first business – Stingray Software. We had developer tools for Microsoft and really drafted off the success of their Visual C++ Platform. Our message was simple: “After you buy Visual C++, call us for the stuff you need next.”
Another variant on this strategy is the – you liked X, replace it with our solution and it’s even better. Examples here are:
* Salesforce.com— If you like on-premise CRM, you’ll love cloud/SaaS CRM.
* Magento—You’ve tried tons of carts, OSS is the best way to go to get the power of a huge developer community. P.S. It is free
I think the ‘replace X’ model is going to be best for what you are doing, however, it’s not clear to me exactly who you would target with your offering, but it seems like the WordPress/Drupal folks are candidates (maybe they are too blog oriented) and if not them then perhaps it’s the Joomla, Wix, Jimdo, Weebly type of systems or even the old-school heavy installed Content Management Systems (CMS) like MovableType.
Evangelism strategy 3—be an expert (inbound marketing)
This page of my playbook has been so frequently used that it’s a bit faded and I have to turn the page carefully lest it fall out. Today there’s a big movement around inbound marketing. Essentially putting a ton of content ‘out there’ and using that to pull people ‘in’ to your marketing message vs. shouting from the mountain tops.
I stumbled upon this one in our first business. It started when I realized there was no online frequently asked question list for Visual C++’s source code library (called Microsoft Foundation Classes), so I started one and published out to message boards. Before I knew it, the MFC FAQ had a huge audience. Then I was asked by Dr. Dobbs to speak at a programmer’s conference on common MFC challenges. I reluctantly agreed and then the light bulb went off when after the talk 10-20 folks lined up to talk more about what I did, what is Stingray software, how do they buy our products. It turns out many of them and the attendees became customers. EUREKA —I was selling our software without ever mentioning it.
In my experience, even today in the chaos of information, this is the single best way to get someone’s attention—become an expert at an area that lacks a ‘voice’ out there. Even if there is a voice, add a unique voice, unique viewpoint and you’ll be surprised.
Applying this example to PencilBlue, I see you are doing some blogging, which is a great start, and I’ve found is an awesome way to start collecting your thoughts. Here’s an example:
Perhaps you could speak at an OSS conference, or even better (see strategy 4) a more specific industry conference such as: E-commerce, hospitality, finance, media/publishing, government, non-profit. Let’s pick media for argument’s sake.
Imagine you are speaking to a room of 500 content creators. The trick is to NOT promote your product, but to help them understand there is a better way:
- Aren’t you tired of content systems that don’t grow with you?
- Haven’t you ever wanted to work on your desktop, then do some work on your tablet and then maybe check out some things on your phone? Multi-screen should be the rule and not the exception
- Examples of why this is painful
- Stats to back it up
- Don’t you think it’s time to marry the philosophy of OSS to content management?
- Examples of why painful
- Thank you—goodbye
The key to this is to have that Chinese wall between your expert-ship and your company and never cross that. It’s counterintuitive, but trust me on this one, you will sell much more of your product this way than being overly self-promotional.
Evangelism strategy 4—cross the chasm
One of my favorite books that I think every software startup founder should read is “Crossing the Chasm” by Geoffrey Moore.
The headline from Chasm — new technologies follow an adoption curve and once you understand how that works, you can be smarter about how you move your products through that curve.
Granted, a lot of this is common sense, but I think the power of Chasm is giving it a vocabulary and helping you think it through.
An example you could utilize @PencilBlue is the ‘bowling alley.’ In the bowling alley phase of market adoption, your technology, while very broad in possible applications, is likely to be adopted by specific vertical industries (retail, hospitality, finance, government, non-profit, media, etc.). As your platform garners early adopters, I recommend watching this very closely. Are there certain verticals that are adopting it faster than others? Perhaps certain messages resonate stronger in one vertical than others. Let’s say you discover that the hospitality industry seems to have an affinity for your solution.
Now you can target all of these evangelism strategies towards the hospitality industry and try to totally penetrate that first early adopter industry. Chasm calls this the bowling alley because once you knock down those first industry vertical ‘pins’, the next ones get easier, but without the focus on the first pin, it’s hard to knock down anything.
Evangelism strategy 5—Trojan horse
This strategy is similar to the ‘draft off a giant’ strategy, but has a bit more nefarious goal. In today’s world, a common challenge you will face is platform inertia— the fact is that once someone starts using a platform, it becomes quite hard to get them to change platforms even though the new one has all the bells and whistles. The Trojan horse strategy solves that inertia problem.
Let’s take WordPress as an example of a platform that perhaps you want to target with this strategy. Before you promote your solution’s superiority to the thousands of WordPress platform users, you could develop a WordPress extension that would slurp out all of the configuration and data/content you need out of WordPress and into PencilBlue.
Then when you launch your marketing messaging one key element is: “move your entire WordPress content over to our platform with a single button press.” Now you have significantly reduced platform inertia and your WordPress extension is the key. Because the OSS community is so open, it can leave those platforms very susceptible to this kind of strategy.
In the early days of Magento, they were able to get a lot of momentum by using a similar approach with OScommerce (the top OSS e-commerce platform before Magento).
Evangelism strategy 6—build a community
Wrapping it all up, as you know the key to a vital OSS platform is a community of dedicated developers that contribute to the platform and essentially breathe life into it. We all see these communities after they are formed and have great momentum, but getting a community ‘rolling’ takes quite a bit of heavy lifting. Don’t underestimate the amount of work here, but once you do get the community going, it can be a powerful amplifier for your evangelism. This is so important one of your early key hires should probably be a community manager.
I hope this deep dive into this startup pattern of evangelism has helped answer your question and give you some ideas on how to get the PencilBlue platform adoption going.
One last thing, you are fortunate that we have the Grandfather of OSS here in the Triangle, Red Hat. There are tons of great Red Hat alumni that give back to the startup community that would be great to go to for advice for PencilBlue when you are ready.
Coming up next
In the next column, I’ll answer a question that actually is probably the most frequently asked question that I get from first-time entrepreneurs. This question is from Aaron (he wanted to be anonymous—Aaron is a web developer):
I’ve always had so many ideas swirling around but never felt drawn towards any one idea over the others. How were you able to come up with 3 ideas that were able to create such value? I just bash my head against the wall sometimes trying to think of something that would create legitimate value for someone, so much so they’d give me their money for it.