3 questions every market newcomer has to answer
Back in the early years after the Sept. 11 terrorist attacks, there was a flood of government spending as homeland security funding grew and the nation took on two wars.
With that flood of cash came a flood of new companies believing they had some technology, solution or other offering that agencies just had to have.
It was in this context that I had a conversation with Dendy Young, then CEO of GTSI, about increasing competition and the impact of new players on the market.
He wasn’t worried. He’d seen it before, and he knew that most of these companies would come into the market and wouldn’t have the patience or dedication to understand the processes and the amount of time it takes to build a pipeline of business opportunities before seeing meaningful growth.
Eventually almost all of these companies pull back.
I’ve taken plenty of meetings and phone calls from these companies over the years, and I have to say, Dendy’s right.
So it was with that skepticism in mind that I took a meeting with Box.com earlier this week.
Box is based in Los Altos, Calif, and provides a cloud-based collaboration platform. I’m not going to go into whether their solution is of value or not (Disclosure: Our sister publication, FCW, uses Box to manage its editorial workflow).
But the positive thing that came across from my meeting with Whitney Bouck, the general manager for Box enterprise, and Chris Manouse, who runs the federal business, is that they aren’t expecting overnight success.
Manouse was hired by Box a year ago, and has over 12 years of experience in the federal market, having been the director of federal sales for Metastorm.
“I asked them the same kind of questions as a potential employer as agencies are asking me as a potential provider,” he said.
The big question centered on whether the company would invest in the things it needs to be successful in government market.
A year into the job, and Manouse can point to Box being in the queue for FedRAMP certification, being HIPAA compliant, and being able offer multi-factor authentication. It also is ISO 20001 certified.
Another area of investment has been the hiring of people focused on compliance issues, which are critical to large enterprise customers such as government agencies, Bouck said. Box recently hired Justin Somaini, formerly chief information security officer for Yahoo! and Symantec as the company’s chief trust officer. Another Symantec executive, Niall Wall, joined as senior vice president of business development.
The company also is taking a decidedly longer view of winning business with business, with Bouck saying that they started the push into federal with the thought that it could be two years before they saw a return.
Early signs are good. The General Services Administration is a customer, as is the Army War College. They also have partnerships with Carahsoft and Deloitte.
The scope of conversations with potential customers also is starting to change for them. In the beginning, agencies were interested in 15- or 20-person pilots, but now they are talking about 1,000-person deployments.
Of course it is too early to know whether Box will be a big success in the market, but the lesson for me centers on the three questions any newcomer to the market has to answer:
- Where are you investing?
- Who are you hiring?
- What’s your timeframe for success?
The answer to those three questions are probably the best early indicators of whether a company can gain a foothold in the market.
Posted by Nick Wakeman on Apr 19, 2013 at 7:24 PM