Masen Yaffee and Erin Lozano started Green Sherpa with a simple yet elegant idea: consumers of personal finance software should have the familiarity and functionality of boxed software such as Intuit’s Quicken combined with the convenience and economy of a Web-based service based on the software-as-service (SaaS) model. It was a value proposition that caught the attention of Guidewire Group chairman and co-founder Chris Shipley, who had actively covered the personal finance software market earlier in her career and understood the value of the software Green Sherpa was bringing to market.
In her role as Executive Producer of DEMO, Shipley invited Yaffee and Lozano, CEO and COO of Green Sherpa respectively, to introduce the product at DEMOfall 2008. The reception to the demonstration of the company’s personal cash management solution was a hit, and both Yaffee and Lozano quickly realized they had the duel challenges of fundraising and bringing the final product to market in a scalable fashion. That’s when they turned to Guidewire Group.
“We had an instant rapport with Chris. She’s an incredible listener… she seemed to know exactly what kind of help we needed. It felt so supportive and so timely,” says Lozano.
Neither Yaffee nor Lozano are novices when it comes to starting and running companies. For 15 years before founding Green Sherpa, Yaffee ran the Web application development company he founded, NDIC, Inc., whose client list includes world-class companies such as Hershey’s, Pepsi, Schwab and Catepillar. Lozano was CEO of Simplicity Services, a company helping families organize their finances, bills and other personal living expenses. In all, she has run three businesses and amassed significant experience as a real estate and economic development executive.
Neither founder, however, had significant experience with institutional investors. So, in December 2008, the team started talking with Guidewire Group about helping them put together a funding package and taking the company to meet potential investors. “The first thing we did was send Chris our funding presentation and executive summary,” says Yaffee. “She marked them both up like crazy and sent them back to us almost immediately. Her turnaround time has always been amazing.”
When the presentation and executive summary were ready, Shipley introduced Yaffee and Lozano to venture capitalists who are part of Guidewire Group’s network of funding contacts, with the goal of sharpening Green Sherpa’s investment pitch and gathering feedback from VCs who were familiar with the personal finance market and SaaS business models. “After every meeting, we’d have a pow-wow to go over what happened and make changes to the materials based on what we learned,” says Yaffee. “We just continued to hone them, and I grew more confident than I ever imagined I would be at telling our story to a potential investor.”
During conference calls with potential investors, the team used Skype chat to react instantly to investor comments and questions. “Chris understands what we are doing so well and understands the investor community,” Lozano says. “She was able to give us feedback in real time that helped us re-direct conversations when necessary.”
At the same time, Green Sherpa has also engaged with Guidewire Group to bring the Guidewire Group team onboard as an extension of its management team in a business development role, developing a partner strategy, identifying prospects and securing partner relationships.
“When we first started working with Chris, it was clear to me that she was the best person to help us with our funding presentation,” says Lozano. “Now that I know more about her and the Guidewire Group’s team’s capabilities, I have a wider view. We need people who can come in and work on specific projects with us. But we also need people with executive-level experience who can come to the table and be part of our strategy team, adding value to everything that is going on in the company. This is a much deeper engagement and uses more of Guidewire Group’s full range of skills and talents.”
Yaffee acknowledges that not every founding management team would have the confidence to bring in high-level consultants at such an early stage. “Over the years, I’ve learned that to make a really great company requires a lot of great people,” he says. “Part of our job as founders and executives is to look for and accept assistance of all kinds, rather than pushing it away because we think we know better.”