Interview: Alykhan Jetha of Marketcircle

Recently the Netsetter had the opportunity to conduct an interview with Alykhan Jetha of Marketcircle, developers of popular Mac small business applications Billings and Daylite. Check below the jump for both audio and text versions of Thursday Bram‘s interview with AJ.

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TB: Can you tell us a little about how Marketcircle got started?

AJ: Marketcircle is actually version 3.0 of the company and let me explain what I mean by that. Originally, when I started Marketcircle, I started it as a dotcom, where we built a web platform that allowed people to negotiate the price of an item, and we had built the system and had people transact and everything on the system, but by the time I got to the appropriate venture capitalists, the internet bubble burst.

And so we weren’t able to get the funding or anything like that, and I had to make a decision, whether I had to close the company down or whether I would return the money to friends and family that had invested in the company. And that was just a couple hundred thousand dollars, but it was strictly friends and family. So we decided, myself and my Chief of Engineering, Mike, that we would pay people back, rather than close the company down. It was a manner of honor, I guess. And so, we did consulting work, for awhile to be able to a.) keep the lights on and b.) actually pay some of those folks back. However, we didn’t like doing consulting work too much, we always kind of had a product idea in mind, and even though I started the company myself, Mike joined on, just a few months after I started, so the company kind of grew from both our ideas and so we were trying to figure out how we would do this.

But we still needed to get the consulting dollars in and what we did, was we built Daylite, one of our current products as a technology showcase, to show people, hey, look at our technical prowess, hire us to build applications for you-still part of the consulting gig. With that particular application, one thing led to another and we started selling the application, and finally in 2004, late 2004, it became our sole source of income. And then we added another product in 2005 and now we’re about 26 people and that’s where our company is at-and that’s the 3.0 version of our company.

TB: Since you’ve certainly been on a journey to take Marketcircle from that first start up to a business that did consulting to having products, did you have a business background before you got started?

AJ: No, not really. I was a programmer. My passion was always building things. And I was doing it in software. So my work prior to starting Marketcircle, I did consulting for about 9 months or so as a sole consultant, and then prior to that I was employed by various different companies, doing pretty heavy duty software. So I was always the technical guy. And so, no, I had no business background other than observation, and so that was a little bit of a learning curve for me. Still is.

TB: How did you start picking up that business knowledge? Did you use any specific resources or just on-the-job training?

AJ: Here are some of the things that I did. Number 1 is I observed people. I did this from very young actually. Just whenever there was a business or business-owner that I was exposed to, let’s say I was working at a coffee shop while going to school, and I knew the owner very well, family, I went and observed what they would do and I always had an interest in it but more from an observation point of view.

So that helped, in that I tried to observe other people and also read. A lot of reading. Read a lot of books, got tips from some books. I would read on the web. Whenever there was a success story or something like that I would try to read, to understand the business aspect of it, and I would get a feel as to what kind of decisions I should be making, things I should be spending my time on. And it’s been difficult, but that’s where I attribute where I’ve gotten to, to mostly that.

TB: So would you recommend that somebody interested in building a start-up; is it okay not to have a business background? Do you think that it’s…?

AJ: I think that there are a couple things that you have to be aware of. I think yes, do it. But, you gotta start somewhere. And the thing to do is to try to keep things simple, try to find good people in terms of accounting, and software so that they can help you with some of that stuff. You have to be careful in who you select as somebody who helps you on the accounting side, you know being a consultant or whatever, so that you don’t get in to trouble on that particular side. The other one, is that once you have that piece, everything else you can kind of read up on and learn on and so on and so forth. There are a lot of good resources out there, that really can help as long as you invest the time to learn that stuff.

TB: You’ve mention that you now have 26 people that work at Marketcircle. How did you decide when was the right time to bring in more people and how did you decide who were the right people to bring in?

AJ: I’ll answer the when of it after, but who, you know, this is, it’s a difficult and time consuming thing. You really have to make sure, especially at the beginning, that you’re getting in people who will really help. I don’t care so much about their degrees or their experience. What I care about is their desire and an honest aspect of their personality. There are a lot of shifters out there. And you hire the wrong person and you can really go down the tubes, especially in the beginning, when you are 2 or 3 or 4 people.

So you gotta look for honesty and a true person-somebody who isn’t out to screw people. And I would choose that over experience or college or academic knowledge any day. Because the person who has that desire and is an honest person, and a good person, yeah, you might stumble a little bit at the beginning, but if the desire is there, they’ll learn. If the honesty is there, you don’t have to worry so much about politics, backstabbing, and all that kind of stuff.

So, that’s really key with the first few people because once you have that base, then you can expand. And for example, hire somebody that is, shall we say, less than honest and you find out later on, they’re a bit shady or they don’t have the company’s best interest in mind, then it’s important that you try to get rid of them as soon as possible because that will haunt you and bite you. And so the next question is when, right? So, when is tricky. Tricky in the sense, do you have enough money to be able to sustain a salary? Will the work that they do bring it to sustain their own salary? That kind of thing. And then finally, it’s you realizing ‘I can’t do this by myself.’  I can’t focus on the right things if I’m always focused on the small things. I need to be focused on the big things for the company, so I need to get somebody.

When we sell to small businesses-our software is sold to small businesses-so we interact with a lot of small business owners, and a lot of them, they start out by themselves, but they have difficulty letting go so they have this apprehension of hiring somebody because they don’t want to let go. But then that holds them back because they can’t focus on the bigger picture, because that is dealing with the minutiae. So you have to realize that you have to be able to trust somebody, with some of the things at least. So that when is a combination of factors. Number 1: mentally, you decide that you need help. Number 2: Having a system to make sure that there is enough money there for at least a few months salary. Number 3 is when they come in, they better earn their keep. So bringing them in, let’s say that you just have a couple months worth of salary cash stored up, within that few months, they better get up to speed and be generating enough to cover themselves at least.

TB: Would you say that there is a learning curve that goes along with managing people, just like the rest of the business knowledge for a start up?

AJ: Absolutely there is. And in hindsight, I would say that that is a very important skill, in the sense of setting habits. You know if you bring people on board and you don’t set the expectations such as, you know, we need status updates, we need to be on the same page, we need to communicate, and instilling that later on when the habits have been formed is much more difficult. So, when you bring somebody on, communication is key, and set that expectation, and updates are key, and set that expectation.

TB: So, how are you planning for the future at this point? Are you looking for more expansion, more product?

AJ: In terms of expanding for the future, we are always looking at growing our revenue base and that can mean a couple things. It could mean expanding our existing products to reach larger audiences. And it could also mean, adding additional products. We’re looking at both those things. But in terms of the management aspect of it, where I find the most difficulty is having a plan in place, letting go of more and more things so that I can focus on bigger and bigger things.

It’s the same problem as when to person-shop, but on a different scale. So you always encounter this problem up to a certain point, I guess, and then it becomes second nature. I’m not there yet. So I find there is a certain mentality when you’re one of three or four people and that is a slightly different mentality than when you’re 5-10, in terms of that, and after that gaps become bigger and bigger so it’s easier now for me than it was say, last year to let go of certain things, and that is something that I always have to work on. Did I answer your question? I’m not sure I answered your question.

TB: I think that’s good. How do you decide where to pursue? If you have an idea for a new piece of software, how do you decide whether it is best to focus your energy on that or focus your energy on your existing products?

AJ: This is very difficult actually. And I would say that I haven’t done too well there. There’s the continual argument that we got to make our existing product better so that we can a.) defend against competitors or b.) keep our customers happy, etc. And then there is when you are starting a new product, putting a new product out takes a lot of energy. It’s like a rocket–it expends the bulk of its energy on lift off.

And so adding a new product is similar. And once you add a new product, are you spreading yourself too thin? That inertia to launch a new product is daunting sometimes. And so that holds us back–the continual battle between improving the existing product vs spreading yourself too thin. Even when you do add a product, it has to be a product that makes sense, so when people come to you, you can cross-sell. For example, with us, we sell to the small business market on the Mac. It wouldn’t make sense for us to do a third product that is totally consumer based, because it’s a whole different audience, our marketing has to be different, our attention and focus has to be a little bit different versus if we brought on a third product that is in that space that we can sell to our existing clients because of integration, et cetera. That makes it a lot easier. You follow what I’m saying there?

TB: How do you differentiate your products from other software that’s available for Mac?

AJ: What I’m finding is that the concepts that you have, as long as they’re fleshed out, you will likely find an audience. And so, for example, with Daylight, when we compete, our concepts are a little bit different than what other’s might compare us to. In that case, these concepts differentiate us and how we’ve implemented those concepts. We can’t compare apples to apples per se in that particular situation. In the case of Billings, our second product, that is vertical so it is easier to compare because there are more competitors that do very similar things. In that case, it is excellence of the product. So, for example, Billings won design awards, we’ve added the iPhone companion, which we’re expanding all the time, we’ve gotten a Mac Word Eddy etc.

So we’ve put a lot of attention to detail, so we differentiated ourselves in terms of what the product can do and how well it can do it. And after all that, service also differentiates, people contact us, we have the appropriate staff to handle their questions, or what have you, so there is a comfort level there, that it’s not just a company that is a kind of fly-by night kind of thing. Those kind of things help us differentiate our product, but it is a.), the concepts can be different and can find an audience that likes those concepts and continue there and b.) in terms of our Daylight product and in terms of our Billings product, there are direct competitors, so in that case, we differentiate ourselves with excellence.

TB: Is there a moment when you know that a product is successful or when the company as a whole is successful?

AJ: That I think is a question of your own expectations. For some people, where we are right now, we’ve done well, for myself, I don’t think so. I keep moving on and I want to keep moving on. So I think that’s kind of a self-everybody kind of has to have their own criteria of what is successful or not. I, for example, I think we can do a whole lot better, other people, they hear our story, they get our details and they are impressed with what we have been able to achieve. So it is a personal thing.

TB: That’s all the questions I have, except for one last one. What advice would you give to somebody who is starting a start-up right now to really succeed with it?

AJ: I would say number 1, you have to balance, you have to be willing to be tenacious. At the beginning, like I mentioned earlier, launching a company or a product takes a lot of energy. It’s like a rocket in that it expends most of its energy at the beginning. So as an entrepreneur, as a person starting up, you need to be, first off, you need to just do it and once you’re doing it, you just have to keep going at it and just not let go. And whenever there is a challenge or a problem, go out there and try and find the solution. So that finding a solution could be through your friends, asking people, could be through Google, could be through Twitter, if you are decidedly tenacious, you want to be tenacious, you want this to succeed, you will find a way.

TB: Well, thank you very much for talking with us.