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While Yellowfin is going from strength to strength now, it wasn’t always like this. Most people don’t realize that we had a near death experience in the early days.
Yellowfin was bootstrapped from the very beginning. Justin Hewitt and I kept ploughing money and time into the business because we knew we had a great idea, and we believed we could change the world of analytics. A few years into the business, we didn’t have much runway to keep going, and we had to make a decision about whether it was worth continuing to invest or if it was time to shut up shop.
It all came down to one deal
The critical time was about 10 years ago, when we were in the process of negotiating a big deal with AlterPoint in Texas. It was a game changing deal for us, that would finally allow us to pay the bills with some headway for growth. Behind the scenes, we drew a line in the sand and set a drop dead date. If we didn’t win that deal we were going to shut the doors.
There was an element of luck involved with this deal, AlterPoint sought us out, but once the deal landed on our door we put everything we had into it. The deal was worth millions of dollars but we didn’t even have the resources at the time to travel to the US. We put everything into winning this deal. Our efforts included a lot of additional development and, in those pre-Skype days, a $50 phone card to keep the lines of communication with the customer open.
Thankfully, we won the deal. While AlterPoint has since been purchased by Versata, the team we worked with founded Blacklight Solutions who are one of our great partners in the US.
I think until today, the AlterPoint team had no idea that we were a few days away from closing. It was a close shave and there was a lot of luck involved.
That deal now defines our approach to risks
Winning that deal symbolized that we really did have what it takes to succeed. It affirmed to us that we could do what we set out to and we had the skills and capabilities to make it.
This realization was vital to our business and our leadership. It has had an enduring impact on how we run Yellowfin. We’re now tougher and more aware of the risks that we’re taking. We also have a better idea of how we contain those risks. Whether we’re thinking about opening a new office or developing a new module within the software, we know that our worst case scenario is to shut it down if it doesn’t work.
This experience has given us, as business leaders, the confidence to grow and manage risk through the business. We make riskier decisions knowing that the worst-case scenario is just going back to where we are today. So we continue to roll the dice, and it’s mostly worked in our favor.
How you lead through adversity has a profound impact on the business
Our decision to set a drop dead date was even more difficult because we weren’t the only people who would be impacted. We had employees whose jobs were at risk who we chose not to tell about our decision. Telling them wouldn’t have changed the outcome. It just would have created unnecessary stress and uncertainty.
I’ve always had the view that as a leader there are some decisions that you just can’t share with the whole organization. That is the burden of the founders and the people who run the business. As a business owner, you have to protect your people and look at what’s in the best interests of the business.
As a founder, you have to put a stake in the ground and define what future you want for your business. We knew that our business needed a dramatic breakthrough, and that’s what this deal was. We did another big deal shortly after, and it was those two deals combined that underpinned the growth of Yellowfin for the first few years.
The decision to (almost) close the doors hardened us as leaders
If that deal hadn’t closed I know we would’ve pulled the pin. It was a purely rational decision, we had no choice, but I honestly don’t know what I would have done next. All I know is that I couldn’t have gone back to working in a grey office, with grey desks, wearing a grey suit.
At the time, I just focused all my energy into winning the deal rather than thinking about the consequences of shutting down the business. Looking back now I realize just how close we came to losing it all, and I get a little emotional.
But I’m grateful for the experience.
Making those difficult decisions hardened us as leaders. We’re more comfortable with risk and less afraid of the consequences. We’ve already faced the worst possible scenario and know that we came through better, stronger, and wiser.