In Money Biz this week, Emma Lo Russo, co-founder and CEO of social media analytics company Digivizer, shares with us her money journey and how the business is just powering ahead.
How much money did it take to start your business?
We started the business by funding it initially with a line of credit against the equity in my family home plus a few personal credit cards and then later through bootstrapping.
That took a large leap of faith in what I believed was the big opportunity in people-centric social analytics in front of us.
What was your salary like in your first year?
There were three of us and a group of contractors in our first year. I didn’t pay myself but kept a book to ensure what was paid to the two other key people would be owed to me when the time was right and we had the cash.
But we all made sacrifices. Even to this day, the team has invested in the company’s future, and everyone is paid less than their experience and expertise could command elsewhere. That’s humbling and wonderful that they choose to back Digivizer and our vision, but it also sharpens my focus to ensure our success.
If money was a challenge in the first year, how did you make it work?
We manage our cash flow very carefully. The first year saw us focus on developing the core technology and platform.
Because we map, track and analyse people on the social web in real-time, and focused on trigger-based sales leads and actionable insights, we were able from very early on in our existence to create reports for clients that delivered value they couldn’t get elsewhere. That meant we could charge for our work, which fuelled our cash flow.
We implemented payment upfront (minimum 25%, sometimes 50%, occasionally 100%) which helped us to invest in line with the new customers. We also claimed the Federal Government R&D rebate from the beginning.
It was tight, but achievable. In fact we only sought and gained private investment in our fourth year, when we needed our first injection of additional capital to boost our development work.
What has been the biggest financial investment?
Of course the biggest financial investment in reality is in our people. We are continuously investing in our future growth.
What has been your best and worst spend in business?
At Digivizer I can honestly say that I don’t think we’ve made a bad investment so far, certainly not in financial terms.
Our best and biggest investment by a long way has been in our people, and in the development team that has built our technology platform.
How has your business grown?
In the last financial year we saw 300 per cent growth over the previous period.
Three years ago companies would commit to projects only. Now they are prepared to commit to programs, and I think this is for two reasons. Their use of the social web has changed significantly to where they were three years ago, and we’ve established ourselves as a company which is delivering meaningful and active “live” value aligned to clients’ own business strategies.
We are now at our fourth premises since our start due to growth. We have grown from the initial two, then three employees at the start to now over 35 employees plus contractors.
We have had customers who are now in their third and fourth year with us and a few from our very start. We have also grown from an Australian company serving Australian clients only to now serving a range of multinational clients globally and regionally. There is still so much growth opportunity ahead.