Building a $7 billion software
company – How to Scale Up
BUSINESS OF SOFTWARE EUROPE
Stephen Allott
Chairman, Pebble Code
Crown Representative for Small and Medium Enterprises,
Cabinet Office

Forecast
Trinity College, Cambridge
Xerox
Sun Microsystems
(1st
lawyer hired outside the US)
McKinsey strategy
Tech and corporate finance
Micromuse President, CFO and
main board director. NASDAQ
MUSE
Cambridge Computer Lab
Trinamo
UK Crown Rep SME
10 chairman roles

MICROMUSE TURNOVER
1
142
83
39
19
63
1995 1996 1997 1998 1999 2000 2001
(£M)

“Market cap of
$5.1 billion”

G-CLOUD DIGITAL MARKETPLACE SALES
£m

Forecast
So ….what is the
number one thing
that you need to
Scale Up?

OEM STRATEGY
1. Dell big: what’s the growth plan and rep deployment?
2. Huawei growth plan and location of manager?
3. Decide on plans for Lenovo, Intel and Cray
AMBITION

Forecast
What else do you
need ….?

Forecast
Product
Plan
People
Processes
Problem Solving

Forecast
Product
Planbuild financial model, decide strategic issues,
identify optimal growth rate, how do you create a model?
People
Processes
Problem Solving

ANALYSE DATA BUILD MODEL
REFINE
ASSUMPTIONS
PHASE
ACTIVITIES
- Agree financial
terminology
- Establish and
explain
structure
- Set basic
linkages
- Review model
and debug
- Discuss
parameters with
Senior
Management
- Set initial
assumptions
- Review initial
results with
senior
management
- Debug/problem
solve specific
issues
- Tighten and
agree
assumption
ranges
- Benchmark
against
comparative
companies
- Sales productivity by
experience band
• Orders by rep
• Rep start and
finish dates
• Senior
management
sales effort
- Field technical
productivity
- Typical sales cycles
- Historic financials
- Historic costs per head
- Typical order profiles
- Understand growth
strategy
17Jan
Board
Meeting
►
13 Jan
►
18 Dec
►
31 Dec
►
FINALISE PLAN SIGN OFF
- Further refine
assumptions
- Review results
with senior
management
- Syndicate output
to individual
board members
- Secure sign-off
for output
►
31 Jan
►
Board
Meeting
- Discussion on
timing of future
fund raising

Forecast
Product
Plan
People Sales, Finance, Product Mgmt, Dev
Processes
Problem Solving

S:Trinamo
InternalTRPTrinamo TRP
Brochure 300407

Hiring great people using the “TRP” (Trinamo Recruitment
Process)

TRINAMO RECRUITMENT PROCESS OVERVIEW
• Defining candidate specifications
• Creating advertisements, briefs for agencies, head-hunters or
other CV sources
• Reviewing CVs and finalising a candidate shortlist
• Candidate interview process
• Compensation plan design

ANALYSING THE SCORES
8.06.38.08.37.0Average
7.086786EF
8.087898CD
7.686987AB
Average
Company
Fit
Functional
CompetencyLeadershi
p
Problem
SolvingInterviewe
r
Averages : a definite hire
Leadership : the greatest strength
Teamwork : good at this
Company Fit : will be an asset
Problem solving : just good enough
Functional competence : will need to learn their role
Teamwork

SALES SEMINAR DISCUSSION TOPICS REQUESTED
• Setting and reviewing the most effective sales strategy
• Setting and reviewing the most effective marketing strategy
• Hiring and motivating effective sales people
• Partnering with bigger companies - worth it or not?
• Gauging why people are or might be interested in your offering
• Growing deal sizes by a factor of 10
• Winning mission critical product sales as a small company
• Managing big sales cycles
• Understanding the sales process and customer decision making
• Post sales support
• Direct or channel
• Customer budgets,sales forecasting, bad debt management

SALES APPROACH DEPENDS ON LIFESTAGE
Lifestage Search Focus Scale
Customer Count 0-10 10-100 100 plus
Reason for winning
deals
No one else will
touch it
Customer is so
desperate they’ll try
you
Better, cheaper,
faster
Customer Need Unique Emerging Patterns Customer
acknowledged
Lead Generation Random From top 3 Areas From top area!

SALES NATURALS
• Holds situational conversations
• Asks relevant and intelligent questions
• Is solution focused
• Targets business people
• Relates product usage
• Manages their manager
• Empowers buyer to achieve their goals
• Patient
TRADITIONAL REP
• Makes presentations
• Offers opinions
• Is relationship focused
• Targets users
• Pitches product
• Needs to be managed
• Attempts to sell to buyers
• Impatient

Forecast
Product
Plan
People
Processestargets, comp, flash
Problem Solving

Why are UK software companies
underperforming?
Here’s part of the answer

SHORT TERM MANDATORY REQUIREMENTS

SHORT TERM MANDATORY REQUIREMENTS

SHORT TERM MANDATORY REQUIREMENTS

Forecast
Product
Plan
People
Processes
Problem Solving

THIS BIG MARKET NEEDS SOFTWARE

WHAT ARE THE ATTRACTIVE VERTICALS FOR THE COMPANY?
MARKET SIZE, $B
COMPANY SUCCESS INDEX (current revenues/market size)
1.0
0.5
1.0 2.0 3.00.0
Aerospace
CAE / Mfg
Weather
Federal
Defence
Invest
Harvest
Weather?
Wild card
FInance
Bio Sci

SHORT TERM MANDATORY REQUIREMENTS
1. Lead generation in target verticals
2. Sales and SE training
3. New hire on-boarding
4. Full collateral (corporate powerpoint, white papers,
vertical presentations)
5. Upgrade web site
6. Key OEM account plans
7. Quarterly sales kickoff
8. Install best practice hiring process

GEO STRATEGY – FIGURE IT OUT……

GROWTH PLAN EX INTERNET SALES

MICROMUSE TURNOVER – BRIGHT WILL BE BIGGER
1
142
83
39
19
63
1995 1996 1997 1998 1999 2000 2001
(£M)

Building a $7 billion software
company – How to Scale Up
BUSINESS OF SOFTWARE EUROPE
Stephen Allott
Chairman, Pebble Code
Crown Representative for Small and Medium Enterprises,
Cabinet Office