Kimberlie Cerrone is an experienced Silicon Valley finance, legal and business development executive and angel investor, having served in numerous venture-backed startups and invested in more than 80 startup companies. Still, when she started her own company, Cerrone experienced firsthand how hard it can be for entrepreneurs to articulate their value propositions – even for an entrepreneur who has spent almost her entire career working with startups.
“I co-founded Aboolla in early 2008, but I’d been thinking about it for more than 10 years,” says Cerrone. “As a C-level executive in a series of venture-backed companies in Silicon Valley, my teams were always responsible for creating some of the company’s most important documents, spreadsheets and other content files – some of it highly proprietary, some of it highly confidential, but all of it important to how we did business. What was really frustrating was that there was never an easy, cohesive way of using them all together to tell the story that needed to be told.”
Aided by advances in content management technology and the advent of SaaS as a way to deliver services efficiently and economically, Cerrone recently decided it was time to solve the problem herself. She formed Aboolla, developed an alpha version of the software and offered it to potential customers. By early 2009, she felt ready to present Aboolla to some of her venture capitalists for their early feedback. That’s when Cerrone hit a snag. She found herself struggling for a clear and compelling way to describe what Aboolla was trying to do and its value for customers. “I had a lot of things to say about what we weren’t, but I was falling short in describing what we were,” says Cerrone.
Feedback from the VCs advised her: “Don’t touch this space, it’s too crowded; Stay away from this market – there are already several billion-dollar players and lots of small, VC-backed competitors; That ship sailed two years ago.”
Meanwhile, Cerrone – who is a patent attorney – had done an exhaustive search of all the publicly available intellectual property in the space and knew that Aboolla had something completely different. Even more important, by early summer she already had 17 organizations using the software and paying for it.
“There was this huge disconnect between the feedback I was getting from VCs and what I was hearing from customers who actually used the product every day and were paying good money for it,” says Cerrone. “I decided I better go talk to Chris Shipley.”
After a few minutes, Shipley told her to stop talking and show her the product. Says Cerrone, “Chris understood what we were doing immediately and told me that I just wasn’t using the right words. I already knew that, but I didn’t know what to do about it.”
On the spot, Shipley took Cerrone through the enterprise content management (ECM) value chain, describing key players and the roles they played. She then suggested various ways to describe Aboolla, positioning it as a new, highly differentiated and valuable extension of the existing ECM ecosystem.
“It was a real breakthrough for me,” said Cerrone. “I had been looking at all these companies as relatively random clusters. When Chris categorized and brought them all together into a market landscape, I could quickly see new ways to position and talk about Aboolla.”
Cerrone hired Chris and the Guidewire Group team to help her articulate a new position for Aboolla and create a presentation for venture capitalists. “The whole team was great,” says Cerrone. “Carla Thompson worked with me to further refine the language I was using to describe Aboolla. Mike Sigal gave me advice on questions VCs would ask and reactions they might have that was spot on. Then everyone helped me prepare to answer these questions. And all of this was done astonishingly quickly.”
Cerrone began a new round of meetings with venture capitalists in the summer of 2009 and received very different feedback. Says Cerrone, “One venture capitalist said, ‘I understand what you’re doing. I just can’t decide whether you are too broadly focused in a large market or you are creating a valuable new communication modality. We have to figure out which one you are and size it.’ Aboolla is still a work in progress, but that’s a far cry from ‘stay away from this space.’”
Adds Cerrone, “There is a saying in France that if you want to establish a successful winery, you’d better have 400 years of drunks in your family. That’s how I feel about the Guidewire Group. Chris, Mike and Carla are smart people and they are wonderful to work with, but they’ve also spent the last 15 years talking with 1,000 companies a year. It is the anti-thesis of textbook learning, and the difference shows.”