It’s been 11 years since Andrew Segar launched his flagship product Simplicity CRM software that helps record and organise a company’s interaction with clients, from his garage in Auckland. It’s now widely used across Australia and New Zealand.
1. When did you realise Simplicity could be a big thing?
Like a lot of IT companies we started small, in my home office with a couple of servers in the garage. We then rented an apartment in the city so our development team could stay away from the day-to-day consulting work and focus on building the best CRM (customer relationship management) platform in the world without any interruptions. There was no big break as such – we just worked hard and amassed a number of good clients over time. Our key focus was on delivering what we promised.
We also grew with our clients. We started servicing just NZ-based clients, and a particularly large company was so happy with our offering that they asked us to expand our service to their Australian business.
2. What were you doing before you founded Simplicity and why did you start your own business?
My background is in both IT and marketing. Prior to Simplicity we owned New Zealand’s largest direct marketing advertising agency Pearson Davis. My wife and I also founded a company called Marketing Technologies, which focused on software applications and platforms for marketing campaigns.
I studied IT. At the time I thought I should have studied accounting, as my first jobs were about writing accounting systems. One day a friend told me that if I had done accounting I wouldn’t be a good programmer, so I think I did the best degree possible.
So, given my IT background, customer relationship management was a logical extension of what started out as a marketing database, particularly after we identified a gap in the market for a high-performing software solution.
3. What goes into developing CRM software?
Developing any world-class application and business is not something that has an end date. Software continues to evolve as the world continues to change. To be successful you must pour vast amounts of effort into ongoing research and development with lots of the best technical people in the world.
Coming from a marketing background, I knew that the so called “world-class campaign management products’’ were overpriced and underwhelming. There was a pertinent need for a cost-effective but powerful CRM solution.
4. Were there any times you doubted what you were doing?
Actually we have doubted what we were doing on many occasions. Some days are great – particularly when you win a big new account. But some days can be disappointing and that’s just life. Like all start-ups we lost pitches along the way, but so far never to the same company twice. And over time our conversion rate has improved. Our key focus has always being on knowing our competitors and knowing where we are better and smarter.
5. How hands on are you with Simplicity now?
I am very hands-on, but understand delegation. I do what I’m best at and leave the other partners and staff to do what they are best at. I still have a lot of input into the product functionality, features and interface.
Spending a lot of time overseas can be challenging, as this means time away from my family. But I try to balance that and spend time with my kids after school and on weekends.
6. On average, how much has Simplicity grown each year since its founding in 2001?
We continue to grow steadily at about 50-60 per cent year on year.
7. How much capital did you start with?
There were originally four partners in Simplicity. We didn’t require much starting capital – but needed time. That’s the nature of a software business, and we put in long hours of development time to produce a desirable product. We have steadily grown but haven’t needed a capital injection and probably won’t in the future. We have never even had an overdraft.
8. What do you like to do in your spare time?
Other than spending as much time as possible with my children, I have a Land Rover that is fully set up for mud-runs and off-roading. That’s great fun. I also enjoy motorbike rides and the occasional day out in the boat.
9. What are the plans for Simplicity’s future?
Each day we will crawl over broken glass for our clients to make their experience as good as possible. We will fight for every new business opportunity where we believe we can do a better job than anyone else in the world. Each time a new idea for a product improvement is tabled we will consider this and possibly add and reprioritise our development roadmap. Simplicity will follow to wherever this takes us.
10. What are the worst mistakes somebody can make in starting their own business?
- Not having enough money to live without income for three years.
- Planning too much. A new business is a journey – you have to be prepared to go with the flow.
- Too much research. Be prepared to go with your gut – but remember my first point.
- Not managing cash. Make sure you collect your debts on time. Love your good clients and fire your bad ones.