Bootstrap as long as you can. Real VC’s do not do deals like you see on tv. They want to work with known quantities who have already sold businesses before. If you don’t have that, they at least want to see you’re capable of making money by bringing in sales. It is very unlikely any VC will give you a deal unless you have at least one of the two. If you have a cool product to boot, they might sweeten the deal, but in my experience a cool product alone will not get you that VC money. Plus, if you build out a working business model with a product on your own dime/time, the VC’s will give you a MUCH better deal. I have seen founders give away half their company for a million dollars. It sounds like a lot of money, but it goes quick and before you know it (especially if you still have to establish product market fit), you will be back at the trough for more. By the time your company has a prayer of being successful, you will be lucky to own 10%. To me, that’s not even really entrepreneurship anymore; that’s just called a job (with one or more bosses).
As part of my series about the “5 Things You Need To Know To Create a Successful App or SAAS”, I had the pleasure of interviewing Dominic Holt. Dominic is a Tech Executive with Fortune 50 and small / start-up company experience. He regularly performs technical diligence, technology selection, software architecture and team mentoring for companies as a Fractional CTO local to San Diego and works globally with many Private Companies, Private Equity and Venture Capital Firms. He serves as the CEO for harpoon Corp and personally developed an enterprise software application that enables anyone to visually generate software infrastructure and deploy it to the cloud without writing any code. Prior to this, Dominic worked for Lockheed Martin where he created and became the division head of the Shark Tank® Organization (a world-class engineering team with a focus on emerging technologies), which from 2012–2015 was responsible for delivering $2.6 billion in revenue. Dominic has also started several startups and has been internationally recognized with an award for video game development.
Thank you so much for joining us Dominic! Our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?
I have worked in the Defense sector for around 14 years now; in the 2013–2014 timeframe I was asked to build out a reference architecture for cloud deployments at Lockheed pretty early on in the Cloud Computing ecosystem. Evaluating some of those tools gave me insight into what people now call “DevOps” (that’s Software Development combined with Operations or maintaining the software in production). Effectively DevOps is about automating the deployment of software and the operations side of the house. Right away I knew this was going to be big in the software development community, but even as a Principle level Software Engineer, it took me close to a year to become proficient with all of the tools, scripting languages, and frameworks to understand what I was doing and be effective. There’s a lot more options and shortcuts now, but DevOps is still inherently a hard thing to do well for software teams and requires a lot of niche expertise to not only understand what tools to use out of an ecosystem of hundreds of thousands of them, but also which tools work together, how to use them, and making the initial investment to put it all together.
What was the “Aha Moment” that led you to think of the idea for your current company? Can you share that story with us?
I was trying to hire DevOps engineers for my current company for a year and truthfully, I couldn’t find anyone with more than a year or two of experience with any tool; the one or two that were more experienced were demanding sky high salaries. I was asking myself how to make DevOps easier for everyone else and happened to be watching a dystopian science fiction show about the future when I saw a visual representation of software booting up on a screen. At that moment, it all clicked in my head and I jumped up from the couch and said, “that’s it!”. My wife still thinks I’m a crazy person. The next day I started building a visual drag and drop prototype for dynamically generating the scripts for automated cloud deployments and harpoon was born.
Can you tell us a story about the hard times that you faced when you first started your journey? Did you ever consider giving up? Where did you get the drive to continue even though things were so hard?
Writing enterprise level software by yourself is hard. I spent many, many long nights trying to solve difficult problems, scrapping entire sections of code due to a false assumption made about how to write a capability, and generally proving out that this thing was going to work at all. Building a company has a lot of ups and downs. I remember the night I got end to end capability working for the first time; I felt so much joy at my accomplishment. I was so excited that I wanted to show everyone, and (even though I knew better) I started to meet with VC’s I knew to show my shiny new thing. Unfortunately, VC’s are much more pragmatic than television shows would have you believe, and they wanted to see sales. One VC firm in particular invited a bunch of technologists who thrashed the idea. The problem is, you are going to run into a lot of people with a lot of opinions about you and your company. As much as it sucked to hear these things, I knew the value I was creating and I also knew these technologists (as accomplished as they were), did not really understand the space I was in and therefore were not really the people I needed to get buy-in from. If you’re confident in your company and what you’re building, you just need to keep pushing forward. Eventually, you will start getting results.
So, how are things going today? How did your grit and resilience lead to your eventual success?
harpoon is still in alpha, but we are making a lot of in-roads on getting positive feedback from customers and starting to get more sign-ups to use the beta.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘take aways’ you learned from that?
I was so sure this was going to be a slam dunk right from the onset and everyone would just get it. I live in a bubble because I’ve worked in research and development most of my career, so I think everyone else is already doing what I’m doing when in fact almost nobody has got there yet. I threw some info on harpoon out to a bunch of investors I knew expecting them to start writing me checks and they responded with a “What is this and why should I care?” mentality. It was humbling, but I also learned you have to build the whole story for people, and walk them through the whole process of how you’re going to take this small concept and turn it into a billion dollars and why people are going to care.
What do you think makes your company stand out? Can you share a story?
There are definitely some competitors in this space, and they are making more money than us because they developed one iteration on top of the current tools and technologies; so it was easy to build and put out there, but all of them will be obsolete in a year or two. Our tact was to build a disruptive technology that turns the ecosystem on its head so that anyone could do DevOps, not necessarily just someone with a Computer Science degree.
Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?
You need to set aside time for yourself; building a company can be all-consuming and there is always some other thing to do, especially if you’re working by yourself or with a small team. Making time to exercise, meditate, and spend time with friends and family has to also be a priority or eventually you’ll end up getting sick and depressed. I got pneumonia 3 times in the first year of building harpoon because I would stay up all hours of the night and then get up early in the morning and go to work and didn’t take care of myself. You’re human, you’re going to need to find balance if you’re going to survive the marathon.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?
I’m really lucky, I’ve had a lot of great mentors along the way (both in business and on the technical side). I’ve had a long list of folks I’ve been able to bounce ideas off of and to go to and ask for advice if I wasn’t sure which way to go with something. Even if you’re building something by yourself; never underestimate the value of reaching out to the community. This can also help save you a lot of time and potentially money when it comes to the assumptions you’re making on what would be valuable to your customers.
Ok thank you for all that. Now let’s shift to the main focus of this interview. Approximately how many users or subscribers does your app or software currently have? Can you share with our readers three of the main steps you’ve taken to build such a large community?
As mentioned, we’re still in alpha right now, but we are taking feedback to make sure that when we switch over to beta, we turn all those sign-ups into paying customers. I think the hardest thing to do is to get your first few paying customers; often I find those have to be from cultivated personal and professional working relationships you have with individuals over just going out and paying for marketing. That was sort of the inception moment for my Fractional CTO consulting company; I needed to go build relationships with companies that would benefit from this capability. The funny thing is the demand for the consulting business is so large that it’s paying for itself AND all of harpoon’s expenses and still turning a profit. Effectively I am paying myself to build a customer base.
What is your monetization model? How do you monetize your community of users? Have you considered other monetization options? Why did you not use those?
It’s a Software as a Service (SaaS) based business, so we have different tiered, monthly pricing for how big the application you’re building is, from a single developer just messing around to an enterprise client with hundreds to thousands of different nodes. Originally the business was centered around dynamically generating the scripts and then spitting out the files for $20. Ultimately, we had to go a different direction than this because there were insurmountable technical obstacles to doing it this way. It turned out that the SaaS model was also more profitable and dependable, but it was a technical hurdle that we ran into in doing research that ultimately led to the SaaS model.
Based on your experience and success, what are the five most important things one should know in order to create a very successful app or a SAAS? Please share a story or an example for each.
- Don’t write code; Writing code is expensive whether you are investing your own time, or you are hiring a team to do the development. The best line of code is the one that’s never written. Prove out your business first by finding your market and making some money. Challenge yourself to create a process or something of value without even building the app. If you can do this, writing the app will not only be easier because you’ll a) have money and b) have a set of customers to gather feedback from, but you can also raise funding if you need to in order to grow quickly.
- Bootstrap as long as you can. Real VC’s do not do deals like you see on tv. They want to work with known quantities who have already sold businesses before. If you don’t have that, they at least want to see you’re capable of making money by bringing in sales. It is very unlikely any VC will give you a deal unless you have at least one of the two. If you have a cool product to boot, they might sweeten the deal, but in my experience a cool product alone will not get you that VC money. Plus, if you build out a working business model with a product on your own dime/time, the VC’s will give you a MUCH better deal. I have seen founders give away half their company for a million dollars. It sounds like a lot of money, but it goes quick and before you know it (especially if you still have to establish product market fit), you will be back at the trough for more. By the time your company has a prayer of being successful, you will be lucky to own 10%. To me, that’s not even really entrepreneurship anymore; that’s just called a job (with one or more bosses).
- There is not a magical formula for running ads where people will magically just come to your site and buy stuff without you doing the groundwork to build out your sales pipeline. Marketing companies will tell you they can do this for you; they can’t. They WILL however take your money. Go out and shake peoples’ hands, find ways to spread the message about your app in person, build relationships. These will come in handy later. It takes a village and having people to reach out to and ask questions to or even partner with will greatly help you.
- Building a company is hard work and takes a lot of time. Like, a LOT of time. All market windows close and you need to catch yours before it’s too late. If you’re not working at least 20 hours a week on your business, you’re going to miss that window. There’s just too much to do and you are probably doing it all yourself.
- Focus on actually doing things. Whether it’s putting an MVP together, getting your first sale, finishing a pitch deck, or actually building your product, each time you sit down to do work, tell yourself what you’re going to accomplish of substance. It is way too easy to sit there and respond to e-mails, dream about what you’re going to buy when you IPO, watch motivational videos on YouTube about entrepreneurship, and just generally do things that fill time but don’t amount to much when it comes to succeeding in your business. Having a disciplined approach with your time where you are focusing on achieving small goals each time you get to work will compound over time and make you successful much faster.
You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
As social media becomes more prevalent and we rely more and more on our digital devices to stay connected with the world and our loved ones, people become more and more isolated from each other. It’s just not convenient to hop in the car and drive 10 minutes when you can FaceTime someone instantly. And since people can now also hide behind their IP address, bullying (especially among children) has become a real issue. The stress and heartache involved in growing up is hard enough without having the prospect of your classmates weaponizing your social media against you. Personally, I have a 3-year-old son and I am terrified of what he is going to run into when he becomes an adolescent. Life is hard, but I believe people are inherently good and that if we just take the time to get to know one another we will find that we all have pretty much the same insecurities and stresses. People should be nice to each other and seek to understand others before persecuting them. I don’t think at this point we can get rid of social media, so perhaps the best we can hope for over the near term is that people will have greater control over how their information is shared with others and that we, as individuals, will be able to own and grant or revoke access to our pictures, likenesses, and messages as we see fit.
How can our readers follow you on social media? I’m not much for social media, but you can find me on Linkedin @ https://linkedin.com/in/dominicholt or just send me a note or sign up on one of my websites. For Fractional CTO inquiries the website is https://valeriantech.llc and for harpoon the website is https://harpooncorp.io
This was very inspiring. Thank you so much for joining us!
“5 Things You Need To Know To Create a Successful App or SAAS” with Dominic Holt of harpoon Corp was originally published in Authority Magazine on Medium, where people are continuing the conversation by highlighting and responding to this story.