VIP Crowd Takes Online Dating Approach to Enterprise Software Buying
[Updated 1/5/18 2:06 p.m. See below.] Three years after Mark Wilson sold the first startup he founded to a French business with hundreds of employees and annual revenues of more than $50 million, he’s back at it, once again working to develop a new software product that targets people in the corporate world.
Wilson’s latest venture is VIP Crowd. The Verona, WI-based startup has created digital tools allowing workers at mid-size companies who are responsible for making purchasing decisions on behalf of their employers to solicit pitches from—and manage relations with—enterprise software vendors.
“Everyone that has any authority to make purchasing decisions is bombarded with e-mails and cold calls,” Wilson says.
VIP Crowd seeks to help purchasing managers cut out some of that noise. The process starts with them using the startup’s website or mobile app to document the products and procedures their companies use for things like accounting and marketing, Wilson says. A business that sells tools for tracking unpaid customer invoices, for example, could then contact a prospective purchaser through VIP Crowd and suggest scheduling an introductory phone call, he says. (VIP Crowd charges some vendors a fee to send messages to purchasers, and requires a separate payment if a meeting takes place; we’ll dive into the details of the startup’s business model in a bit.)
VIP Crowd isn’t a sexy business (although the enterprise software startup’s matchmaking system has some aspects in common with consumer dating apps). But plenty of successful companies have been built on ideas aimed at solving mundane problems. The keys for VIP Crowd will be attracting a large number of software vendors and purchasers to its platform, and ensuring its tools are useful enough to keep customers coming back.
It’s too early to tell if VIP Crowd will build the sizable user base necessary for it to really take off. However, investors are betting that Wilson can once again guide a startup to an exit. VIP Crowd recently raised $820,000 from four investors, according to a document filed with the SEC earlier this week. Wilson—who incorporated the company in 2016 and began working on it in earnest last year—says he’s seeking to raise another $680,000 by the end of January as part of the seed funding round. [This paragraph updated with more details about the company’s origins.—Eds.]
VIP Crowd currently has six employees, Wilson says. The startup plans to use some of the proceeds from the recent round of financing to add more staff, he says.
Wilson says the participants in the round were “all local angel investors,” some of whom also invested in the first startup he founded, TermSync. That company, which developed cloud-based accounting software, was sold to Lyon, France-based Esker in 2015 for an undisclosed sum. Accounting is Wilson’s specialty—he’s a certified public accountant who previously worked in auditing at Grant Thornton, and later served as controller at Madison, WI-based Jellyfish and Sonic Foundry (NASDAQ: SOFO).
Wilson says VIP Crowd’s tools are aimed at encouraging employees to continually assess the performance of software products their organizations license from other businesses. That breaks with how many mid-size firms handle purchasing today, he says.
“A lot of companies I’ve worked with really only look at those things once a year when it comes time for budgeting,” Wilson says. “We want [purchasers] to have an ‘always be curious’ attitude. A couple times a month, they should step back and say, ‘What is taking up a lot of our time? Is there a better way?’”
VIP Crowd’s software can help clients discuss problems with the processes they follow … Next Page »