In March of 2013 we finalized the negotiations related to moving the QGenda headquarters to Buckhead, and now almost 3 years later we are negotiating a major expansion of 12,800 sq ft in the same class-A office building. The expansion which will give us a total of 30,000 sq ft and make us one of the largest tenants in the building. When looking at the economic terms of our lease from 2013 compared to the economic terms of our 2016 major expansion, you will see much less favorable lease terms for us that add up to over half a million in additional expense over the life of the lease.
2013 Lease Terms:
- $22 per sq ft per year in rent.
- First 8 months free rent inside the 5 year term.
- $20 of tenant improvement allowance per sq ft for space buildout.
- Allocated 5 parking spots per 1,000 ft.
- Able to pre-negotiate an expansion into adjacent space at any time in first 2 years of 5 year term with the same economics as the main space.
2016 Lease Terms:
- $31 per sq ft per year in rent.
- 3.5 months free rent.
- $15-$20 of tenant improvement allowance per sq ft for space buildout.
- Allocated 3 parking spots per 1,000 ft.
- Outdoor street level monument signage on the building for QGenda as one of the largest tenants.
- Unable to pre-negotiate any expansion space, but will require a rolling first right of refusal on any future available space with more than 5,000 sq ft.
When we first negotiated our lease, the building was only 60% occupied, and today the building is over 95% occupied with only a handful of spaces available. The high demand for Buckhead office space is a clear indicator that Buckhead has become one of the most desirable locations for a company’s office space.
The first day of the new year is a perfect time to reflect on the prior year’s accomplishments and start focusing on goals for the new year. While continuing to remain self funded at QGenda, the 2015 year turned out to be our best ever.
Here is a quick look back at QGenda’s 2015:
- 998 fully qualified product demos performed
- 379 new customers from the 998 demos
- Added $5,009,294 of new customer annual recurring revenue
- Grew from 48 employees to 100 employees
- Low customer churn with 97% customer retention
- Added Time & Attendance and a few other major product enhancements to our core scheduling platform.
The QGenda 2016 look forward:
- Add $10,800,000 of new customer annual recurring revenue
- Have 100,000+ healthcare providers scheduled by QGenda
- Grow from 100 employees to 160 employees
- Expand from 18k to 30k sq ft of office space in Atlanta
- Open a west coast office in the San Francisco Bay Area
- Increase QGenda’s Average Revenue Per Account (ARPA) by offering customers additional products and services to go along with their existing QGenda workforce management platform.
I feel blessed to be part of such an amazing company, and am truly grateful to be surrounded by the best employees and the greatest customers!
As a fast growing healthcare startup, we are always looking for ways to expand our amazing culture and continue providing the best place to work. A company’s culture is not something that is completely controllable, but it is something that can easily be influenced a number of ways. Every startup, no matter the size, can easily afford the following inexpensive ways to influence the company culture:
- Weekly Wins is an email sent out on Fridays (typically by the same person each week) with single line highlights of team member accomplishments such as: Bob crushed a huge implementation, or Susan hit her monthly sales quota in 3 days. A fun twist to also include a funny weekly flop at the end of the email such as: Mike ran straight into a door spilling coffee all over himself. The person behind the weekly wins email usually sends an email around on Thursday asking for team input for weekly wins.
- Weekly catered pizza is a very inexpensive way to bring the entire team together while enjoying a free meal compliments of the company. Eating together as a team is one of the most social parts of human culture and fits well into any company culture.
- Provide annual Costco memberships to all employees. The membership is a nominal $50 per year, but so many employees appreciate this small gesture.
- Monthly car washes paid for by the company for all employees. We are lucky enough to have a car wash person onsite at our building, but there are plenty of car wash businesses that will travel to you. The car wash is around $20 per car and is something every employee really appreciates.
I am sure there are hundreds of simple inexpensive ways to help improve culture around the office, but the above methods have worked well for QGenda.
What are some of the ways you help influence company culture where you work?
Last week I had the pleasure of talking with a fellow entrepreneur who is in the customer discovery phase of his new business idea. His idea centers around helping companies scale successfully that are in the growth stage with 25-75 employees. During our customer discovery interview together, he asked “as the CEO of a company experiencing high growth, what are the top 4 priorities you find yourself working on each day?”
Here are the top 4 priorities I mentioned in my answer:
Hiring and retaining the best talent to join the QGenda team. We have done a great job at hiring the brightest minds from all over the country to join our team, and we are lucky to have an amazing company culture. Please join us: QGenda.com/careers
Customer retention and providing the best product support is another high priority and a huge differentiator when it comes to our competition. We definitely take pride in over delivering to all customers. A customer in distress is a natural part of any business, and luckily it is a rare occurrence at QGenda, but when this happens we take an all hands on deck approach in that everyone at the company steps up to help in any way possible.
Product vision and continual innovation of new features is something I constantly think about. In order to stay in touch with our customer’s pain points and drive the product vision, I travel at least twice a month with the implementation team and help train end users without them knowing I am the CEO. Seeing exactly how customers use the product and talking with them at length provides for a great starting point to developing new features.
Learning from mentors and other entrepreneurs is important because they have most likely been in your similar position before, and their advice will save you time, money, and prevent you from making any mistakes they might have made along their journey. I am a huge fan of asking entrepreneur mentors lots of questions, and I have found that entrepreneurs really like helping other entrepreneurs, so always ask for advice when you making big decisions!
The top 4 priorities of a founder/CEO will always vary based on the current stage of their company. The top 4 priorities I dedicated time to today as a growth stage company are very different than they were in 2006 when I set out to build QGenda. What are the top 4 work related priorities you dedicate time to?
The Atlanta technology startup scene has really blossomed over the last few years with further investment and development of environments like the Advanced Technology Development Center (ATDC), Atlanta Tech Village (ATV), and the Hypepotamus. Many Atlanta startups (such as DocTime) are attracting the best local talent from GA Tech, but what does Atlanta need in order to attract great talent from other amazing schools throughout the country? One idea is to combine some the best attributes of the ATDC, ATV, Hype, and Y Combinator into an exclusive Tech Tropolis incubator.
Here are some of the ideas for the Tech Tropolis:
- Stand alone 6 to 8 story building in West Midtown Atlanta
- Exclusive and competitive application process w/ acceptance of only a handful of startups each year where the founders must have a technical background
- Top 2 to 3 floors would be free furnished apartments for founders
- Bottom floors would be dedicated to free office space for founders
- Free catered lunch & dinner Sunday through Thursday so founders can soley focus on building their business
- Expectation to live and work in the Tech Tropolis for 1 full year
- $75,000 initial investment from the Tech Tropolis in exchange for a small percentage of equity
- Monthly outings such as laser tag, whirly ball, habitat for humanity, braves or falcons game, etc…
When starting a company some of the most time consuming and biggest challenges are office space, living space, having enough money, remembering to eat after hours of heads down coding, and the list could go on and on. The idea of the Tech Tropolis is to help completely eliminate all of those distractions and give founders a pure complete environment to thrive as entrepreneurs with the least amount of worry.
What else is Atlanta missing to attract the best talent from across the country? What else should the Tech Tropolis include for founders?
Back in January after finishing up an amazing 2012, we decided to add fuel to the fire at QGenda by investing heavily into creating a repeatable sales process. In 2012 with only a few sales team members, we performed around 250 product demonstrations with a 41% close ratio yielding us 104 new customers without having a true sales process in place.
Since January we have grown the sales team at QGenda from a 2 people to currently having 14 rock-stars filling the roles of VP of Sales, Director of Sales, Account Executives, and Business Development Reps. We are excited about QGenda’s move into a new larger office in Atlanta’s Buckhead Tech Corridor where we plan on doubling the size of our sales team over the next year.
Here are some staggering growth metrics after just 6 months of sales efforts:
- 399 demos performed
- 28% closing ratio with 110 new customers
- 1800+ prospect touches (emails/cold-calls) per week
- 2.2% of prospect touches schedule a product demo
It’s an exciting time to be part of the QGenda sales team, and as we go through the rest of the year gathering more metrics about our sales team machine we will continue to tweak & refine the repeatable sales process.
What other sales metrics are important for a SaaS company to track throughout the year?
Hiring new innovative rock-star talent with a self-starter personality is something we constantly think about every day at QGenda in order to provide the best customer experience during high growth. Although now with 30+ employees I’m a bit removed from the hiring process, but it was not that long ago when I personally interviewed each and every candidate along the way.
Here are some hiring tips we use at QGenda:
- Attract candidates by asking fellow employees to recommend people they know, attend college career fairs, and post job listings on linkedin.
- After casting a wide net and gathering hundreds of resumes, filter them down by looking for certain key indicators about their technology prowess. For example, are they using a modern tech savvy email interface like GMail or are they still sporting a comcast or bellsouth email address.
- Once the candidate passes the key indicator filter, a quick 10 to 15 minute phone interview can tell you a lot about a person. We like to break the ice with one of the most important questions during a phone interview by asking “Tell us something/anything about yourself that is NOT on your resume.”
- If the candidate passes the phone interview, the next step is to bring them in for an in-person interview where they will take a tour of the office, meet as many existing employees as possible for a corporate culture fit, take a written test with subjective & logic portions, and lastly work with 3 others to solve logic problems on a white-board.
The process above ultimately helps us hire candidates that are motivated to do whatever it takes to succeed, make unequivocal eye contact, and speak logically with conviction. Hiring new employees is one of the most exciting parts about growing a business and is far from a science, but using some basic guidelines can help streamline the process.
What are some other key indicators or guidelines you use when hiring new employees?
We recently signed a 10,000 sq ft lease with a pre-negotiated expansion option of 6,000 additional feet and look forward to relocating the QGenda headquarters to the 11th floor of Tower Place 100 in the Buckhead Tech Corridor. At QGenda, due to our rapid growth, we have consistently outgrown office space over the years, and today we have 30+ employees spread across multiple floors for a total of around 4500 sq feet.
Here are some key factors to consider when looking for an office space:
- Parking space allotment is always a ratio in the form of X # of spaces per 1,000 sq feet. You want to make sure you always get a minimum of 4 per 1,000. During our search there was a penthouse office space we really liked, but the ratio was 2.6 per 1,000 so we had to eliminate it from consideration.
- Negotiate free rent inside the term of your lease. Most landlords will try to give you free rent outside the term of your lease by saying it’s a 5 year term with 10 months free rent making it a total of 70 months. It is much more preferred to be a 5 year deal with 10 months free inside the term of 60 months.
- Pre-negotiate adjacent expansion options before signing the lease to prevent the landlord from taking advantage of your growing needs by knowing the best space in the entire city for your business to expand into is the adjacent space right next door.
- Tenant Improvement (TI) allowance should be an average of $4 per sq ft per term year. You should have the option to use part of the TI towards moving/cabling.
- Avoid signing a personal guarantee.
- It doesn’t hurt to ask for free parking. However, if the building is well occupied it is highly unlikely you will receive a deal on parking fees, but they typically will make up for it in free rent or some other way.
- Expect an annual rent escalation of 3% each year, but have it begin in month 25.
Finding the perfect office space for any business is fun, time consuming, tedious, and definitely requires the help of a professional commercial office broker. If you have 10 or less employees, then on-demand office space at the Atlanta Tech Village would likely be the best solution.
What other key points have you negotiated in your own office space lease(s)?
I have found when talking to other entrepreneurs, they easily get caught up and bogged down by focusing too much energy worrying about competitors, such as their funding, pricing, marketing spin, and sheer existence. At QGenda we embrace competition and try to objectively learn as much about our “frenemies” product limitations or other weaknesses so we may casually exploit them during our product demo.
Here are some of the ways at QGenda that we have consistently beat our competition without lowering prices:
- Strive to be the best place to be a customer by retaining existing customers through offering the greatest support they have ever seen before.
- Constantly engage with prospects and customers about their pain points and continually invest in evolving the product to better suit their needs.
- Admit to prospects that your solution is not the cheapest, and prove to them that reducing pain points, top-notch support, and saving time is far more valuable than just saving money.
- Keep track of existing customers that switched to your product from a competitor and provide prospects a reference list of customers who switched from other products. If you provide amazing support and retain customers, then your competitors will not be able to use this one against you and it clearly gives you the upper hand when a prospect realizes that zero customers switch to your competitor.
- Go beyond the usual name dropping of existing customers, and without breaking any confidentiality clauses, provide the prospect as many real world scenarios about your product solving existing customer needs because the prospect can most likely relate to the same issues.
Despite our competition constantly trying to beat us solely based on having much lower prices, we rarely lose deals to competitors for many of the reasons above. Competition is good for every business because it validates the existence of a market, and remember it’s always a good idea to remain friendly with competitors because it’s nice to be first on the list of people they call when they are looking for an exit.
What are some of the ways you beat competitors in a sale?
When a software company is in the early stages of existence, all they have to worry about is doing whatever it takes to get their application in front of as many potential customers as possible without worrying about a repeatable sales process. Once a company reaches a certain point, such as surpassing the million dollar milestone (or whatever metric applies), then it becomes increasingly necessary to create a scalable & repeatable sales strategy.
In order to continue our high growth, we have adopted a new sales strategy at QGenda to make our customer acquisition methodologies more repeatable no matter how many sales people we add to the team over time. The first major change was defining the structure of the sales team, which consists of a 4 year goal oriented promotion track of Business Development Rep (BDR) –> Account Executive –> Sr. Account Executive –> Sales Team Lead.
At QGenda we have an extremely high closing ratio (45%) for prospects that take the time to see a webinar, so for us it is important for the BDRs to constantly be setting demo appointments for the Account Executives. As a Business Development Representative you are expected to:
- Send 15 new prospect cold emails per day
- Send 15 follow up emails to previous cold emails from 3 days ago
- Make 15 calls to follow up emails sent from 5 days ago
- This equates to a minimum of 45 prospect touches per day
- Set 25 demo appointments per month (only count those that get performed)
Once a BDR reaches a specific goal (e.g. 250 demo appointments get performed) then the BDR should immediately be promoted to the Account Executive position. As an Account Executive they are responsible for performing demos, providing proposals, and closing hot leads. The Account Executive and Sr. Account Executive get promoted to the next level by booking $1MM in recurring revenue. Sales people are typically very competitive and goal oriented, so defining sales goal parameters that lead to promotions helps create a healthy motivated sales team.
What other ideas can help create a repeatable sales process?