Lessons Learned from Two Years of Bootstrapping CMX and our Plans for the Future

This is post #3 in my 365 Writing Challenge. Subscribe to follow along.


It was Sunday, November 17th, 2013 when Max Altschuler and I sat down at the W Hotel in SOMA to watch football and discuss an idea for a new conference. A couple hours later, we shook hands and decided that we’re going to give this CMX Summit thing a shot.

I remember being really afraid. I had never run a conference before and had no idea where to begin putting one together. There had also never been a community focused conference at the scale of what I envisioned before. I wasn’t sure if we could pull it off.

Two years later, I couldn’t have possibly imagined how far it would have come. We have now hosted 5 conferences totaling over 1500 attendees, launched our publication that has reached over 130,000 professionals and brought in over half a million dollars in revenue (and a little less than half a million in costs). We’ve done this all completely bootstrapped with a team of 2 (at a time).

Today I’m proud to say the community industry looks significantly different than when we started.

There are more companies investing in community than ever before and community professionals are starting to see their work as part of a larger discipline. The amount of confusion around what community means for business is on the decline. And businesses are generating insane amounts of value for their business and customers through community programs.

We certainly don’t claim responsibility for all of the advancements in the space as we’re just one of many key players, but I’m very confident that the hard work our team put in has had a significant impact on the direction, definition and perception of the community industry.

CMX’s existence certainly hasn’t been with extreme struggles however.

Our first NYC conference almost completely flopped, and we almost lost $50,000. We were able to get it to just over break even by making some big last minute changes and bringing on some last minute partners who went to bat for us when it mattered most. It was one of the scariest times of my entrepreneurial career. CMX being completely bootstrapped, that $50k deficit would have come out of our pockets, put us in debt and probably ended the company. Until a couple months ago, all of my credit cards have been maxed out and I wasn’t taking a salary (I got paid when the company made money).

As a founder and CEO, I’ve found myself tested over and over again in more ways than I’ve ever had before. After one year, my cofounder Max decided to switch his focus to his other company Sales Hacker because it was doing really well and that’s where his real passion is. I fully support his decision Max is still an active advisor for CMX, but I’ve definitely felt his absence. Being a solo-founder has been an incredible weight and a huge learning experience.

In this time, I’ve become acutely aware of my own strengths and weaknesses. As is often the case for early stage CEO’s, my weaknesses can become the strengths and weaknesses of our company. Luckily CMX has had the help of amazing people along the way, namely Carrie Jones who started out contracting for CMX, and has grown to become a true partner and part of the heart of this company. She’s one of the most passionate and driven people I’ve ever worked with. She compliments my weaknesses in many ways, without which CMX would look very different today. I’m incredibly grateful to have her on the CMX team.

With all this,  I wanted to take a minute to reflect on some of the hard lessons learned from challenges I and CMX have faced.

I’ll also share some of our plans for the future at the end of this post.

Let’s dig in…

Lesson 1: Leadership is a Moving Target

Yesterday I wrote about my own ambitions to become a better leader. The tough thing about leadership is the game is always changing. What makes a great leader one day may be completely different the next. Especially as your team grows and your company matures, your expectations as a leader will change.

There are some aspects of leadership that come very natural to me. I’m good at getting people really excited about the community industry and I have my moments of storytelling greatness. Where I struggle is in having a clear plan (I’m more of a freestyle type) and so without a clear plan, it’s hard to have conviction for that plan. Without conviction, you can’t earn respect and leadership is all about respect.

This year our theme will be discipline. Being disciplined in our routines, in our plans and in our conviction to those plans.

When you’re in a leadership position, just remember that the game is always changing and you don’t always have to have all the answers. What’s important is that you’re clear about your plan and your values, and that you have conviction for those values. They’re the one thing that should remain steady.

Lesson 2: Writing your Values Down isn’t Enough

We have a super clear vision and mission at CMX (see here). We reference it constantly and it serves as our north star. We also have a doc of our values, but we haven’t has as much success applying them to our work. I take a lot of inspiration from companies like Buffer and Zappos who live and breathe their values.

They each have a page laying out all of their values, and so that’s what we did too. The thing is, that’s not enough. I think we’ve failed to really integrate our values for two reasons:

  1. Our values sound nice but aren’t really unique to our culture and personality
  2. More importantly, we don’t hold ourselves accountable to applying our values

The first one is a more obvious issue, though apparently it wasn’t obvious enough for us to fix it until now. Simply put, don’t just put words down that sound nice. Choose values that really speak to who you are, what makes you unique, what makes your weird, and paints a picture of the best possible version of your organization.

The second one is where most fail with values. You write them down and they sit there in a google doc, rarely looked at again. How can you make them something that bleeds into everything you do? How do you integrate your values into every decision your team makes, every interaction they have and every product they build?

A few ways we’ll be working to improve this:

  • Actually print them out so you see them every day
  • Specify how to apply your values in your daily activities
  • Ask team members to share how they’re applying the values to their work
  • Review them with every person you interview and revisit them with every employee regularly
  • Give props to your teammates when they exhibit your values

Lesson 3: You Need Deliberate Communication Rituals

Communication is an area we will always be working on improving. I’m a firm believer that communication is the most important part of building a company.

When you fail at communication, you become less efficient, you move slower and you risk negativity going unnoticed.

I’m an extremely open person. I get a rush from being transparent. If you ask me anything I’ll give you an honest and open answer. Because of that, I figured that communication in our company would be good. I could breed a culture of transparency. Wrong…it doesn’t just happen. You need to make communication happen. You need to create a space for it.

I learned this lesson very clearly with the help of my team. Early last year we were all working very hard and I was pretty heads down all the time getting stuff done. The thing is, a lot of the work of the CEO isn’t seen by others. Setting up operations, managing financial docs, taking a lot of meetings with partners…these are all things that take a lot of time for me but my team had NO idea what I was actually doing on a daily basis.

We fixed this in with two processes:

  1. EVERYTHING goes in Asana and anyone on the team can see all the completed and upcoming tasks of other members of the team
  2. Daily updates in Slack where every morning, we share what we’re working on that day and how long each thing will take. We also share when we’re available to be interrupted that day and when we shouldn’t be disturbed

We’ve done other things to improve our communication. Our team does weekly 1-1’s which are focused on giving honest feedback and share our feelings openly. It’s tempting to start talking about projects instead, which happens often, but you have to try to avoid it.

We’ve also started doing team retreats twice a year. I hope that as our company grows, and we get more resources, we can invest more into these kinds of experiences as they’ve proven to be invaluable for team building and keeping the company direction on track.

This is still a work in progress for us. The daily updates are hard to stick to. I learned quickly that if I don’t do it, no one else will. So being disciplined and forming good habits is key for communication.

Creating more communication rituals is going to be a priority for us in 2016. We’re about to start trying this one for showing gratitude.

Lesson 4: Bootstrapping is a Slow Starter

I’m really proud that we’re bootstrapping CMX and that we’ve been making revenue since day one. Having been in the startup grind for 7 years, I’ve had my share of rapid growth startups, raising capital and pursuing the unicorn dream. This time, we’re doing it different.

I still have massive ambitions for CMX to be a fast growing, successful company. The reality is that bootstrapping a company makes it incredibly hard to grow quickly, simply because you can’t hire until you’re making enough money to pay them.

If you raise a million dollar seed round, you can build a core team of 4-6 people pretty quickly. The CMX team has remained at 2 people since we started. We’ve accomplished an incredible amount with such a small team. Of course we’ve had the help of some amazing advisors like Robin Spinks, Hiten Shah, George Arabian and Bastian Vidal, as well as contractors like the Reinventing Events team for conferences and devs and designers we outsource to, but the major bulk of the work done at CMX has had to be done by two people who are getting paid very little.

We’re two years in now and we’re just now getting to the point where we can comfortably hire 1-2 more people. We’re bringing on a few Global Partners next year who will help us fund our initiatives to advance the industry and that will help us give CMX the resources it really needs. Every day I still feel a temptation to go out there and raise more money from investors. Having more capital to play with would make life a lot easier. But it will also limit the kind of company we can build. Just because it’s easy doesn’t make it the right move.

Just know if you want to bootstrap your business, and you don’t have a boatload of your own cash that you can put into it, get ready for a long, slow grind.

 

Looking to the Future of CMX and the Community Industry

Heading into 2016 CMX is the strongest it’s ever been.

Financially we’re becoming more steady with the help of new products and partnerships that are bringing more predictable revenue. Moral is high and we’re planning to make some critical hires in the next couple months to grow the team. The CMX community is growing organically every day, and we’re seeing more members take on leadership positions to bring events to their own cities.

We’ve developed a lot of trust with the community industry and we still have a ways to go. We want to become indispensable to community professionals. Our focus is on creating as much value for them as possible. It drives every decision we make.

Because we’re bootstrapped and not a startup, we’re not expected to grow our profits exponentially, and can focus on growing CMX slowly and specifically. I’m incredibly proud to be building this kind of business. I expect CMX to be around for as long as the community industry exists and to be built on real value, and real revenue.

Now we’re ready to take CMX into the next phase of our long term strategy.

The last two years have been all about building the community. We put the priority on hosting events, building the online community and creating a ton of content for the community industry. We knew that the biggest thing the industry needed was a sense of unity and access to more information.

It’s put us in a good position where most in the industry know and trust us. We don’t take that trust lightly, and serving the community will always be what drives every decision we make.

Now that awareness and understanding of community strategy is increasing we can begin the next phase, establishing community as a discipline.

We already launched our first online training course, which sold out in a week and has a long waiting list. With that validation we’re going to continue to develop the industry’s most comprehensive education and certification program. This will be a huge step in legitimizing the industry and creating a set of standards for community professionals to live by.

In addition to online training, we will be building out our matchmaking program to help companies recruit world-class community talent and formalizing our consulting and workshop offerings to help companies plan and execute a complete community strategy.

Eventually our plan is to develop the technology that community professionals will use every day to be more efficient in their work. I don’t think the industry is quite there yet, but it’s getting there quickly and when it’s ready, we’ll be ready too.

Onward!