3 Secrets to Bigtime ISV Growth

INFINIT Consulting Founder and President, Jerod Powell, shares the hard lessons and eventual successes that came from his company’s ISV transformation.

Company Name: INFINIT Consulting
Founded: 2005
2016 Sales Revenue Growth Rate: 100%
2017 Projected Sales Revenue Growth Rate: 100%
Employees: 20
Phone: (408) 361-8888
Website: www.infinitconsulting.com
Verticals: construction, energy, financial services, manufacturing, nonprofit, retail, tech firms
Vendors: Microsoft, Dell, CISCO, Cloudiway, Nimble Storage, SkyKick
Distributor: Ingram Micro

Jerod Powell remembers well the excitement — and reservations — he felt when he first considered making the transition from a managed services provider (MSP) to an independent software vendor (ISV) in 2014. The process happened organically, starting with INFINIT recognizing a trend among organizations with 1,000+ Microsoft Office 365 users having difficulty managing shared contacts. Powell researched the issue further and discovered that neither Microsoft nor any third-party software providers had a solution to the problem. “Although many IT solution providers had the skills to manually fix the problem by writing PowerShell commands, no one took the initiative,” he recalls.

Despite nagging doubts that he could invest tens of thousands of dollars and thousands of hours into building the perfect app and no one would want it, or that someone would steal his back-end code, Powell prevailed. One year after becoming an ISV, INFINIT added $1 million in new revenue growth, despite making a few rookie mistakes, quips Powell.

After catching up with Powell recently, he shared some of the biggest lessons learned over the past few years, and he insists they’re key drivers in his company’s 100% revenue growth last year.

Secret #1: Offshoring Software Development Can Be Costly

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After discovering his killer business app idea, Powell knew he had to build it right away before another software developer beat him to the punch. To avoid overburdening his current staff, he would have to subcontract the development work to third parties. “My biggest mistake was thinking I could rely on offshore software developers without properly vetting the companies and understanding cultural differences,” recalls Powell. “Even though their hourly rates are only about 16% to 20% of what an experienced U.S. software

developer charges, it doesn’t mean you’re going to save 80% to 84% on your project development costs if you don’t do your homework first. Skipping these important upfront steps led to projects that should have been completed in two months taking a year. I’ve learned that the best way to utilize offshore talent is to work through a seasoned local developer who has offshore experience and can help avoid the pitfalls I ran into earlier.”

Secret #2: Recognize Where You Need Help

During the first year of the ISV transition, Powell discovered that developing business software required much different workflows and processes than selling managed services. In addition to the complexity of creating the product, there’s lots of complexity involved in protecting it, says Powell. “Initially, I felt like everything we developed was proprietary and had to be patented. After several sessions with patent lawyers followed by hefty invoices, I realized I had to be more judicious about which portions of code necessitated legal protection and which didn’t.”

Powell also recognized that his new software developing venture was spreading his attention too thin, so he brought in Darrin Swan, former executive at Dell, to take the helm as CEO of INFINIT Consulting. “Darrin brings more than 20 years of experience in business process optimization and software sales, channel development, go-to-market, and organizational leadership,” says Powell. “Upon joining INFINIT, Darrin was tasked with helping to scale and accelerate our digital transformation business growth. What he’s been able to accomplish in such a short time is legendary.”

Shortly after bringing in Swan, Powell brought in software development expert Frank Coker, president and management consultant at Information Systems Management, to serve as chair of INFINIT’s board of directors. “Frank has been a management consultant for more than 25 years, he cofounded six startups and he’s directed numerous business turnarounds,” says Powell. “He and Darrin have been instrumental in optimizing our processes and workflows.”

Secret #3: If You Have Complex Projects/Workflows, You Need Scrum

Powell describes his first year as an ISV as trying to build a skyscraper without first laying the foundation. And, one area where Coker and Swan helped INFINIT build a solid ISV foundation was by utilizing the Scrum methodology. Scrum is a popular agile project management methodology or framework used primarily for software development projects. Per the SCRUM ALLIANCE, here’s a seven-step overview of how the methodology works:

  • A product owner creates a prioritized wish list called a product backlog.
  • During sprint planning, the team pulls a small chunk from the top of that wish list, a sprint backlog, and decides how to implement those pieces.
  • The team has a certain amount of time — a sprint (usually two to four weeks) — to complete its work, but it meets each day to assess its progress (daily Scrum).
  • Along the way, the ScrumMaster (Note to self: This is one of the greatest titles ever!) keeps the team focused on its goal.
  • At the end of the sprint, the work should be potentially shippable: ready to hand to a customer, put on a store shelf, or show to a stakeholder.
  • The sprint ends with a sprint review and retrospective.
  • As the next sprint begins, the team chooses another chunk of the product backlog and begins working again.

The following video gives a nice visual of how it all works.

“We’ve shored up our processes, which has included restructuring our chart of accounts and business divisions along with benchmarking companies against each other and operating more efficiently,” says Powell. “We’ve also built a dev team that includes several seasoned industry veterans. We still utilize some offshore coding assistance for certain, low-end or redundant projects, but all the highly technical and important coding happens stateside. Although bringing in a new CEO and shifting to onshore software developers has driven up our expenses, it was the smartest move I could have made. Not only is our development time significantly faster and our agility better than ever before, we’re once again projecting to double our revenue this year.”


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