Businesses have been trying for eons to gain competitive advantage by better understanding their customers. But the challenge today is very different from even the fairly recent past.
Since before John Wanamaker famously said, “I know half the money I spend on advertising is wasted, but I can never find out which half,” in the early 1900s, the difficulty was in collecting enough data to make informed decision. Until nearly a century later, that remained the highest hurdle.
Although the term information explosion dates to the 1940s, and big data was first used in the 1990s, it’s really only within the past couple of decades that using data has become a bigger challenge than simply gathering it. As Synopsis reports:
“The Internet, mobile, and the cloud are all enabling the rapid growth of data. In 2007, at the start of the mobile era, we generated 0.5 ZB of data worldwide. By 2011 at the start of the cloud era this had increased 4x to 2 ZB. In the 9 years since data has increased more than 15x worldwide. The rate at which we generate data is increasing exponentially with 90% of existing data created in the past two years.”
It’s no longer particularly difficult for enterprises to collect data or store it. The challenges now center around three key trends:
- Turning vast quantities of data into actionable insights requires sophisticated technology and hard-to-find skillsets. But the tools are getting smarter.
- Customers today expect businesses to personalize both messages and product offers, the way Netflix and Amazon do.
- It’s not simply a matter of making the right decisions, but making them fast, that’s essential for success. The past year has offered a dramatic example of how quickly economic conditions and demand patterns can change.
In 2001, three entrepreneurial partners took the reins of a startup technology consultancy and began building an organization that would guide clients through these challenges, implementing software and processes to take control of their data and get better operational visibility, enabling them to make better decisions, with more confidence, in less time.
Here’s the story behind eCapital Advisors from partner Matt Frederick.
Welcome to the founders interview on Webbiquity. This episode is sponsored by virtual event platform Shindig. Any system will let you show slides, but only Shindig is able to let your participants to network and mingle using video chat as naturally and spontaneously as at in-person events. Check it out at Shindig.com.
Based in Minneapolis, eCapital Advisors has been serving clients locally and nationwide since 2001. Though the company’s service and technology offerings have evolved and greatly expanded over the years, its essential mission has stayed the same: to empower clients to use data better in their organizations, to create valuable analytics that help them become heroes to their businesses.
That often means revamping or creating innovative business processes using leading edge technologies. The company helps clients understand their business better, which helps unlock insights and empower decision-making. Across the organization, people get access to the information they need quickly, to make better business decisions that drive better outcomes and enhanced competitive advantage.
In the last 20 years, the way data is used has exploded, especially with the development and embrace of cloud computing. People have access to more data than ever. eCapital helps its clients better leverage that information, to get it into the hands of people that need it to do things like planning, budgeting, forecasting, business modeling, and visualizing the impacts on operations, sales, finance, and HR.
The company’s champion can be different based on the company, the specific problem they are trying to solve, or the pain they no longer want to experience. Traditionally, eCapital has been focused on the office of finance. Many of the company’s consultants, and even its sales and marketing team are former CPAs and business analysts, people who have worked in the industry (including former clients) who are now looking to help drive more change in more companies.
But while the office of finance is a natural fit, depending on the company, the sponsor could be a VP of sales, an IT executive, the COO, or anyone trying to solve a specific pain through data and analytics.
Services aren’t really focused on specific industries, as finance professionals often have a lot of the same pain. But being based in Minneapolis, the company works with many retail, manufacturing, healthcare, CPG enterprise, and medical device makers.
eCapital also frequently works with colleges and universities. Finance departments in higher education manage their budgeting very differently from commercial finance teams. Their planning is focused on how to make sure the institution is still in business 100 years from now.
This has been a particularly challenging year for that segment, with all of the questions around remote learning, bringing students back to campus, trying to recruit new students using virtual campus tours, and all the pandemic-related issues.
They have a revenue stream to look at. How do you manage campus events, dorm life, classes, and dining in a safe way? Some schools were better set up for virtual learning than others; now all schools are trying to adapt. A lot of students are getting used to virtual classes now, so going forward, they may expect more options. That impacts the higher ed revenue model as well.
There are a lot of changes coming to our education system based on the current reality and ways colleges and universities have had to adapt. eCapital consultants help administrator think through those changes and do scenario planning.
Year founded: 2001
Funding rounds: self-funded
Company size: 300+ clients, 80 employees in 16 states
Tom: What inspired you to work on a solution to this particular problem?
Matt: Out of college, I and both of my business partners, Steve Whinnery and Lisa David, worked at Anderson Consulting, which was Arthur Anderson at the time and later became Accenture. That’s how we all got our start, working at one of the big five management consulting firms, though it was the big seven back then.
We did a lot of traveling, worked for a number of really big clients. Two of us had backgrounds implementing PeopleSoft. We were devoted mostly to the office of finance and PeopleSoft’s financial package. So our backgrounds were technical; Lisa was an auditor, so she has an extensive background in finance and accounting.
eCapital was founded in 2001, and actually, the original two founders are no longer with the company. The three current partners, owners of the company, all came in at different times over 2001 and 2002 and eventually took the company over from the founders who gave us a great foundation. We’ve leveraged that and continued to build and grow the company since then.
When we came to eCapital, they were looking to broaden their team both from a technical perspective, to bring in some of that best-practice consulting methodology we had gotten at Accenture, plus the accounting background that Lisa has in the office of finance.
It’s been great to have that diverse experience on our partner team. As the business grew, we brought in an outstanding leadership team well-rounded in consulting, in business acumen, and in understanding the pains that our clients are going through.
And then we just continued to build out that next layer of the team. It’s been fun to watch that all happen, and the industry is constantly changing so there’s always something to work on and think about and invest in. We’ve been very lucky to have great technology partners to work with that are doing an amazing job with innovation, giving us great things to talk to our clients about and deliver value-added activity.
Tom: Thinking back to those early days, what were the most effective tactics or channels for promoting the company to your prospective clients? Digital channels were obviously different back then. Social media hadn’t taken off yet. Blogging, which is a big part of your marketing success today, was still in its infancy. How did you get the word out at first?
Matt: As a new consulting company, based in Minneapolis, we of course didn’t have a nationwide brand at the time. So, we did a lot of leveraging our technology partners, capitalizing on their brands to get better exposure for eCapital.
Many of our technology partners have great channel programs where they work with us and help with things like training, marketing, and funding. We take advantage of a lot of those programs and they’re able to amplify our voice and our messaging to the market.
They’re able to talk to their clients about their great technology, but then they bring us in to deliver great customer references, and experience with use cases, and implementation support. Because a lot of customers, especially the office of finance people who don’t traditionally do a ton of IT projects, are nervous about implementing new technology. They’re typically a risk averse bunch.
So, for our technology partners to bring us in and say, “These people have the experience and are going to make you successful,” is very powerful, very valuable. We’ve done a lot of work building those relationships with their channels, with their sales teams, and with their executives to really help promote their brands. And they help promote ours.
Throughout eCapital’s history, we’ve leveraged that as a one of our main go-to-market routes. And then, as we’ve grown and built a larger client base, there is a whole network of referrals that’s been very productive. As individuals who work for client companies move into new roles, new opportunities, they will often call to talk about new ways we can help them.
Our mission is to do a really good job taking good care of our employees, and our employees in turn do a really good job taking care of our clients. That’s always been our philosophy: we take care of our employees, we try to create a great place for them to work, they do a great job with our clients, and our clients continue to buy from us. And when they move into new roles, they bring us in again. There’s a nice network of partnership that happens that we’re really proud of.
Over the last couple of years, it’s been really interesting from a go-to-market perspective. No one’s at work. There aren’t a lot of phone calls being answered, people aren’t at their desks anymore. Even with email, it’s challenging to break through.
So we’ve done a lot of work on our digital presence. We’re really making it easy for people to learn about who eCapital is, what we do, and the value we can provide. We’re doing lot of work through avenues like LinkedIn and other social networks, our blog, online events, content marketing, video…promoting our solutions, and the value we can provide, through digital marketing has been a newer avenue for us but something we’ve had a lot of success with.
And I don’t think those things will change. We’ll continue doing that going forward.
Tom: Please finish this sentence: “Knowing what I know now, if I were starting over today, what I would do differently is…”
Matt: Yeah. In the technology world, you definitely make bets, you bet on certain technologies and where you think things are going. Some of those bets pay off and some don’t.
And so, looking back, for example, you start hearing about something called the cloud. And you ask yourself, are big companies really going to put their data out there? Is that going to take off? Will it be just a fad, or something real?
In hindsight, I think eCapital, and a lot of companies, tend to be a little risk averse, and not jump into those technologies perhaps as quickly as we should, or embrace other changes in the market. We have to walk that fine line between delivering technology that’s proven and embracing what’s new.
I think all of us at eCapital have learned a lot over the last 20 years and we now do a better job of that now of really evaluating quickly and either investing and launching those things, or saying, “No, this doesn’t work for us. This isn’t right.” We’re making those decisions much faster.
So there are definitely times I will look back and ask why we didn’t embrace certain new technologies, why we didn’t jump on those bandwagons, more quickly.
It’s probably pretty similar for most businesses. People want to give things time to kind of shake out, and evaluate if those are the right decisions. But I think the longer you take to make that decision, and the more invested you get in the status quo, the harder it is to let go.
We have to do our best to make it not emotional, to make decisions based on the facts and the best information available, knowing sometimes we may bet wrong. Hopefully, we’re more right than wrong over time. That’s always been a challenge, and is still a challenge, for most small business owners. Where do we invest?
Tom: Absolutely. And that’s actually a great segue into my next question, which is: what’s the most important advice that you could offer to an entrepreneur starting out today?
Matt: It’s a good question. I think a big reason why I’ve been able to stay in this career for as long as I have and be successful is I started on a delivery side. Like, I was deep into the weeds. So I really understood how our projects worked, and what our clients needed, and I was there, supporting our people and clients throughout it all.
At this point in my career, I can leverage all that experience and those best practices I’ve learned, what works and what doesn’t. When I talk to prospects, I can say, “I’ve been in your shoes, I’ve made this work for other clients. This is how we’re going to do this particular thing right.” And they can recognize that I have that experience.
So, I think my top recommendation for people starting out is: you have to put your time in. The more you learn in those early stages, the more valuable you’re going to be as you grow your business, as you look at what you’ll be able to do down the road. I think the value you can provide to a prospective customer, as well as your team and your investors, is just that much greater.
You have to invest the time and the energy to really develop deep expertise. I think it’s pretty clear when people are speaking about something and there’s just not a lot of depth there. That comes across and people recognize it right away. So get deep. Get into the weeds. Put that time in. It will pay off big in the long run.
Tom: Last thing: If people are interested in learning more about eCapital Advisors, how can they connect with you or with the company?
Matt: Obviously there’s our website, eCapitalAdvisors.com. We write a newsletter, and we typically have two to four events each month. People can definitely come, attend events, listen in. We hold a lot of roundtables which are more best-practice discussions around analytics and data and what people are doing. So feel free to attend one of those.
And as I said, we’re investing a lot of time and effort in LinkedIn, so just following our company page on LinkedIn is a great way to see what we’re talking about, what’s going on, and engage with us. It would be great to see some new faces at those virtual roundtables, or on LinkedIn or Twitter.