The Entrepreneur Interview Series #13: Aric Bandy, Agosto

Minneapolis-based tech consultancy Agosto is today a Tier 1 Google Cloud Premier partner and cloud product development company that works with household-name clients like Groupon, HyVee, Quicken Loans, and Herman Miller.

But back in 2008, it was a small IT services firm struggling to stand apart in a crowded market as well as weather the storm of the impending financial crisis and economic slowdown.

Here’s the story of how the company made the transition from managed services to innovative solutions provider.

The Products and Services

Agosto helps organizations innovate and modernize their IT operations, to move from legacy hardware to cloud-based infrastructure. The company focuses on helping clients achieve three objectives:

Transition from heavy iron (hardware) and data centers to a flexible, scalable cloud infrastructure, and move data out of silos into the Google cloud.
Implement the Google G Suite collection of apps for email, online file storage, office functions, scheduling, online meetings, and more.
Develop cloud native applications to solve unique business problems, specifically in IoT and analytics.

Agosto works primarily with midsized to enterprise clients ($200 million in revenue and up) to transition away from the “technical debt” (infrastructure they’ve acquired and built up over time) to a more flexible, responsive, scalable cloud environment. Technical debt is not only costly but also slows organizations down in being able to respond to the market.

Clients span vertical markets from retail to technology to financial services, consumer goods, distribution, and other sectors. The common thread is the desire to disrupt their space using technology.

Agosto positions itself as a boutique systems integrator, Google-centric, and “born in the cloud.” As President Aric Bandy puts it, “We are pure-play Google Cloud helping clients leverage the technical advantage Google Cloud can offer.”

Their differentiator is really understanding how to bring Google Cloud to help their clients be the disrupters in their space.

The Company

Year founded: 2000

Originally focused on IT strategy and implementation services, the Agosto team saw where Google was going in disrupting way organizations purchased and consumed IT with G Suite. They pivoted the business to focus on Google, and Agosto is now one of Google’s largest partners in North America.

Funding rounds: Self-funded

Current size: 450 customers, with company headquarters in Minneapolis plus sales offices in San Francisco, Chicago, Toronto, Houston, and Nashville

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The Inspiration

Webbiquity: What inspired you to work on a solution to this particular problem?

Aric Bandy: In 2007, I was consulting with 2^nd Wind Exercise, a $100M exercise retailer with 105 locations. 2^nd Wind started 2007 with plans to triple in size. I architected an infrastructure plan to support 2^nd Wind’s growth. However the 2008 recession hit and over the next two years, revenue actually fell by half. Having implemented a cloud-based tech stack, 2^nd Wind was able to easily scale up and down based on market demand, without capital being tied up in infrastructure and hardware.

We saw, through our own experience, how Agosto could help with the client journey to become a disruptor. We’re not like a big consultancy. We’re the coders, the scientists, the geeks on the forefront of machine learning (ML), artificial intelligence (AI), and analytics. We are cloud natives.

We’ve been doing cloud development for 12 years but feel like we’re still at the forefront of all this, still passionate about finding technical solutions that solve business problems, and doing it cloud-first. What drives us is being the engineers, the geeks who find innovative ways to solves problems. We’re one of only a handful of Tier 1 Premier Partners located in North America. We’ve even built software for Google.

The Launch

Webbiquity: What were the most effective channels or methods for you to get the word out to prospective customers when you first launched your services?

Aric Bandy: Initially we didn’t do much marketing. We had a website, some graphic design, and a direct sales team that would cold call and go out to find prospects. Our challenge was helping people see the vision of what we’ve done and can do.

Early projects proved our technical abilities and Google started sending clients our way, including hiring us for some of their most complicated deployments. I was on the Google Cloud Partner Advisory Board from 2008 through 2017. Lastly, our team align with Google product strategists and customer engineers to help clients figure out how to go cloud with Google.

Today, we’re beating out bigger competitors. Massive global system integrators hire us to work on their behalf. Plus, we have more of a full marketing program: PR, content marketing, events, design. But our engineering and reputation stand out.

The Lessons

Webbiquity: Finish this sentence: “Knowing what I know now, if I were starting over today, what I would do differently is…”

Aric Bandy: I would have grown faster. We’re still in an emerging space with analytics and ML. There are still so few data scientists. I would have looked for better way to find, cultivate, and grow our own data scientists to meet demand. There is negative unemployment in IT in Minneapolis right now. Big companies and consultancies are gobbling up talent.

So, if I could start over, I would have focused more on growing talent early on.

The Takeaways

Webbiquity: What’s the most important advice you could offer to an entrepreneur starting out today?

Aric Bandy: A valuable piece of advice I got but didn’t appreciate at the time was: really invest in people.

When company is small, you can have a hand in everything, you know all the clients by their first names. Your own strengths can propel the company.

But you get to a size where that no longer works. If you haven’t developed talent, you hit a threshold you can’t grow past without changing the way you work.

We track our Net Promoter Score (NPS), ask ourselves “why do we exist?,” discuss our purposes, and ask clients how we could be more relevant to their business. Answering those questions, as a management team, will help us grow to the next level.

It’s heroic effort at first, then you plateau; you need the right people to embody the vision and support the growth. You need structure and processes to support growth.

A company between $1M-10M in revenue can be driven by a single, charismatic leader can. Growing from $10M-25M, a single leader can’t make things happen the same way and the strength of the management team becomes crucial. Growing beyond $25M, it’s about your strategy to stay ahead of what’s needed for growth.

Retention is as important as hiring. Not every hire is perfect, but when you find the right person, you need to figure out not just how you keep them on board, but also keep them passionate and focused.

You can connect with Aric Bandy on Twitter and LinkedIn.