Intelliseek is gathers consumer-generated information from the Internet and caught the wave of the blogging phenomenon. It was acquired late last year by Dutch company VNU for its stable of information-gathering businesses in its Nielsen BuzzMetrics unit.
No doubt Intelliseek’s meteoric rise a 150 percent increase in revenue last year over its $5.6 million mark in 2004 made the 50-employee company an attractive target for a buyout. That kind of growth also created its share of pain for a firm trying to keep up with the demand for its services while holding the line on costs and keeping itself attractive to potential suitors.
Mike Nazzaro, former president and CEO of Intelliseek and now president and COO of Nielsen BuzzMetrics, found that reining in costs while feeding the growth engine has been key to the company’s success and the successful exit for its investors through the VNU buyout.
Smart Business spoke to Nazzaro about how careful planning created the discipline to choose the right opportunities carefully instead of chasing every one that came along.
How did Intelliseek achieve its rapid growth?
There was the acceptance of us as a really important marketing medium. We really took off, and I think what helped spike that as much as anything was the growth and the hype around the blogs and the blogging phenomenon.
We helped really crystallize, over the course of a period of time, our value proposition, and we got better and better at doing what we do in a way that adds value for our customers. It wasn’t just nice to have. We became more must-have, we became more actionable.
What was the biggest challenge you encountered during that fast-growth period?
Any company that’s trying to get profitable and grow, you’re putting a massive premium on revenue, so you’ve got your sales team out there aggressively trying to bring in deals. Once you sell the customer, they want the service the next day, even though it might take four or five weeks to set it up.
A lot of it falls on the delivery organization. If you weren’t cost-constrained, and you could have people there in case demand surged ... it would be an easier problem. We never hired too aggressively ahead of sales. We’ve always had to staff in a way where we made sure we had the business first and it wasn’t just a good week.
Employing that kind of philosophy creates a lot of short-term pain. You have a culture and a mindset that you sell everything as quickly as you can, but then very quickly, you’re overwhelmed with having to deliver all that and fulfill it. It’s always a challenge ramping that up as quickly as you can.
How have you met those challenges?
You try to address it by knowing what to sell and knowing what to pitch. This whole world of consumer-generated media is not super clear or tightly defined. Customer expectations are not entirely clear, so just getting our sales team to define what our products are, what we’re selling in the first place, you try to instill some of the discipline.
Beyond that is really, once we effectively have a client, we put a lot of rigor in what we call our statement of work process. Our delivery team, before we’ve actually fulfilled the business, in a reasonable, detailed and methodical fashion outlines what it is we plan to do and what we plan to deliver.
How do you keep the business staffed at the right levels?
Whether or not you’re hiring, whether or not we’ve had positions open, we’ve always had an eye out for recruiting, we’ve always had our eye out for good people, just to have relationships, just to start relationships with people who could be prospective candidates down the road.
We found that a meaningful source of candidates is some form of referral from existing employees. I think at some level, it all starts at creating and sustaining a positive culture and environment in-house that, first and foremost, you don’t want to lose people because there are always costs to bringing in someone new.
So first, we did a good job of retaining the people we wanted to keep and secondly, letting that experience generate positive word-of-mouth about our business that would lead to other candidates.
What’s the key leadership skill needed by a CEO in a fast-growing company?
You have to be very careful not to micromanage, not to meddle. Unless you manage in a way that not only brings people in but manage in a way that builds leadership in the ranks, it gets difficult to grow.
That’s a very common situation I’ve seen in other companies, when the CEO is just so hands-on in the way they manage. They may say they’re hands-off, but they may be so critical of a decision that they weren’t part of that they really are training the organization to come to them with everything, to get their approval on everything. It’s disempowering, and it creates a lot of bottlenecks that get in the way of growth.
How to reach: Intelliseek Inc., www.nielsenbuzzmetrics.com