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| Home - CEO Spotlight - Aug 02 Issue |
'No Magic Formulas" - CEO Spotlight: Chanan Greenberg, CEO of Privia (Aug 2002)
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Stability – when asking an executive to join a start-up you want someone who you feel will have the will and desire to stay for the long run. People with a history of leaping from one job to another would not be on the top of our priority list.
Personal fit – building a new company, requires a lot of hard work, putting up with long hours and pressure – but it is also fun. There is a bond that is built between people going through this experience and when adding someone new into the picture its important to have them fit in.
Sterling-Hoffman Management Consultants: How do you motivate your people?
Chanan Greenberg: Salaries, options and dreams are part of the motivators in an early-stage company. The spirit and experience of working in a startup environment are important too. But the most important thing is to believe that you are building something great, a company that is going to make a difference and make a lot of money. Believing this makes it easy to show others, with conviction, what we are doing and getting them excited. And whenever we get a new customer that validates we are on to something, it becomes tangible and the excitement level grows.
Sterling-Hoffman Management Consultants: Aside from setting revenue goals, what kind of quantitative goals do you set for softer areas such as Marketing or Human Resources?
Chanan Greenberg: All expenses, including HR and Marketing must show a clear and direct connection to increased revenue, if they cannot, management needs to carefully evaluate if it can justify those expenses. If money is being spent on a marketing program then Marketing should produce plans that shows how that is going to increase the sales pipeline and that plan will be used to measure if the program was successful or not.
Sterling-Hoffman Management Consultants: How important do you feel Vision and Values are to an organization? To Privia?
Chana Greenberg: Without vision there cannot be a company. A company is not established out of thin air – there has to be some drive, an idea or an objective that shows merit for investing resources to start a new company – that is vision. Values define what you stand for – customer service and customer satisfaction are derived from the values you instill into the company. In Privia management and employees share the same vision and values, which enable us to provide increasingly better products to our customers and continue growing.
Sterling-Hoffman Management Consultants: Looking at the market today, has the attitude towards an ‘IPO’ changed today? How so?
Chanan Greenberg: Attitudes have changed. In 2000 we saw many software companies go public, many of which are still not showing profits and growth today. In 2001 fewer than 10 software companies went public and all have shown considerable growth. The market is scrutinizing companies much more carefully now. Only companies that have a true business that can sustain growth will be going public and for much more realistic valuations. This may turn off some people who were looking for a quick and easy exit, but this creates opportunity for those who choose to build long lasting strong companies, which will provide lucrative exits for their investors.
Sterling-Hoffman Management Consultants: Current market data indicates that customers are extremely skeptical about new software purchases. Are you having the same experience? How do you convince a customer that Privia’s applications will impact their bottom line?
Chanan Greenberg: Yes. Customers are very careful when considering buying new software. The market seems to be broken down into two types of companies: those who are still busy deploying enterprise software they bought 2 years ago or are still licking their wounds from a bad deployment; the other type are those who heard about those difficult experiences and are very careful not to experience those problems themselves. It is not easy to sell enterprise software. However, Privia has managed to identify a critical business need that is completely under-served in large organizations. Privia provides Revenue Pipeline Management applications to companies that sell and deliver big ticket, highly customized products and services. Privia helps organizations focus on the most lucrative business opportunities, increase profit margins and improve visibility and control over recognizable revenue. These companies have serious challenges in managing their revenue and keeping costs under control – explaining Privia’s benefits is made easier by the fact that our customers are aware of their business problems and their negative impact. By providing a suite of applications that address Business Development, Proposal Management and Delivery Management, Privia helps these companies’ instantiate best practices, gain visibility into cost overruns and control their revenue.
Sterling-Hoffman Management Consultants: How often do you as a CEO get involved in sales situations?
Chanan Greenberg: I get involved as much as I can - probably not as much as I would like to. I often go on sales calls with our Director of Strategic Accounts or our VP Sales – it’s important for management to have direct contact with customers to better understand their needs and drive the company towards better serving those needs.
Sterling-Hoffman Management Consultants: What have been some of the more significant achievements of Privia since 9/11?
Chanan Greenberg: Immediately after 9/11 Privia closed its first VC backed financing with Benchmark Capital and Venture Strategy Partners. We established our HQ in San Mateo CA, built the sales and marketing team and closed our first 5 customers that include 3 Fortune 1000 companies.
Sterling-Hoffman Management Consultants: What other lessons or insights can you share with anyone who is about to take on a leadership role with a software startup business?
Chanan Greenberg: It’s important to qualify the opportunity. Ask yourself do you believe there is a viable opportunity that you can get excited about and want to dedicate many precious days, weeks and months to building. Check who the management team is, who is backing the company, and if they have customers talk to them. It’s an exciting time to be building a company - find an opportunity you believe in and a team you want to work with and go for it!
Angel Mehta is a Managing Director at Sterling-Hoffman, a retained executive search firm that represents venture capital firms and enterprise software companies in VP Sales, VP Marketing, and C-Level recruitment projects. He can be reached via email at: amehta@sterlinghoffman.net.
 
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