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How Does Your Business Grow? StormSource CEO Offers Software Startup Advice (Page 1 of 3)

StormSource Software, a software developer based in Scottsdale, Ariz., markets Appointment-Plus scheduling software, now in its fifth version. 

The  firm weathered (and won) a challenge from Microsoft, and continues to post impressive revenue growth: 2009 saw a 43% increase over 2008, 2010 was another 43% boost over 2009, and 2011 will accelerate -- in the range of 80% growth, says CEO Bob LaLoggia. 

LaLoggia founded StormSource in 2001. The company now has 50 employees, and is hiring: LaLoggia expects 2011 to finish with 60 to 65 employees.

Starting and growing a successful software company involves a lot more than building a cool app, LaLoggia says; here's his advice for fellow entrepreneurs:

Tip #1: Focus on infrastructure, not just product.

"In the beginning you focus on product," LaLoggia says, "but what you soon understand is that it's not the best product that wins. Building infrastructure to support growth is hugely important. 

"That means a development framework, policies, procedures, internal systems, trouble ticket systems, billing systems, and so on. With that in place, when we hired people we could get them up to speed and productive much faster. 

"I was involved with several other startups, so that helped. I also worked for Accenture for five years, and got a lot of experience with growing an organization from the ground up. I got to be part of all that. I learned all the components of a business."

Tip #2: Reach out to other entrepreneurs and mentors.

"We have an incubator here in Arizona called AZ Disruptors,"  says LaLoggia. "I'm a mentor, and I met with two startups yesterday. They're in that situation of looking only at their products. They're solely focused on getting the product out, and not looking at marketing and sales. 

"I told them to come see my office, to see what a 50-person operation looks like. You need to try to talk to entrepreneurs who are a little farther along. I think it's really important to find others who are slightly ahead of whatever point you're at."

Tip #3: Take advantage of existing tools.

"There's a lot more tools at your disposal nowadays," LaLoggia says. "In 2001, when we started, we didn’t have all the SaaS products we have today. Those tools make it easier to start a company without investing a lot of money. Today's startup has it easier both for software and hardware."

Tip #4: Educate yourself about the VC and angel world -- and put yourself in front of them.

"You need to learn as much as you can about venture capital and funding," says LaLoggia. "And you need to go way beyond online research. It's really important to learn that world. 

"I think it's smart to try to present to angels even if you know they will never accept your idea. It's going to help you understand what they're looking for. Maybe you’re heading in one direction, but  someone investing or acquiring is looking for a different direction. You can build that right into your business model."

Tip #5: Decide what you want before you start.

It's important that you have clear business goals before you start building that killer app, says LaLoggia. "When I started my company, I don't know what I was thinking. 'What do I want out of this? Do I want a lifestyle business? '

"I liked doing my own thing. I wanted to achieve things. I wanted to make money. But as soon as I got the business rolling, I realized that I’m not going to become a millionaire overnight. I realized that it's harder than I thought to get and retain clients. And, I realized I’m going to have to get employees."

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