Publisher and Reporter with Silicon Hills News
At a funding pitch to a venture capitalist, Ben Rubenstein, co-founder of Yodle sketched out a business plan on a napkin.
He showed the potential investor how Yodle was going to raise millions to capture the small to medium sized business market as customers for its marketing software.
At one point, he ordered a drink and the waitress requested to see his I.D. She didn’t believe the 21-year-old Rubenstein was old enough to drink.
“Here I am asking for millions of dollars and I can’t even order a drink,” Rubenstein said.
In 2005, Rubenstein launched Yodle out of the University of Pennsylvania with his childhood friend Nathaniel Stevens. They initially targeted the automotive industry. They also brought on John Berkowitz as a co-founder. For two years, they bootstrapped the company. Rubenstein slept on a AeroBed Air Mattress in his friend’s house.
In the beginning, they went door to door pitching their product to small businesses. It took them two years to get to one million dollars in recurring revenue. And at that point, they raised their first round of investment and moved the company from Philadelphia to New York.
They created the term Yodle because they wanted to create a Yodel or shout out for small businesses. They couldn’t buy the Yodel domain name but they could buy Yodle.com.
Rubenstein and his co-founders pitched more than 50 VC firms before they landed their investment. They were able to deal with the rejection because they had faced so much of it making cold calls on small businesses, Rubenstein said.
“With cold calls, if you make 100 phone calls and make one sale, you’re a hero, you’ve had a good day,” Rubenstein said.
To get customers, Rubenstein and his co-founders spent the weekend at trade shows demoing their software and pitching to customers. They eventually spent more time on the phone and hired a large inside sales team to cold call small businesses. With the advent of WebEx and GotoMeeting, they were able to effectively demonstrate the software online.
Sales were integral to the success of Yodle.
And Yodle recruiters would ask people when they hired them to talk about the first time they sold something, Rubenstein said.
Rubenstein launched his first business venture in fifth grade. He would buy Airheads candy and sell them for 25 cents a piece to his classmates. He only had 25 people in his class so soon he enlisted his friends to sell the candy in their classes and bring him the proceeds. At one point, a kid decided to launch his own candy business selling his product for 15 cents. But Rubenstein resisted dropping his prices. He sold out every day so he kept selling his candy at 25 cents despite the new competition.
“I learned at an early age how to sell things,” Rubenstein said.
Throughout scaling Yodle, Rubenstein learned a lot about how to hire great sales people and how best to sell the product.
Today, Rubenstein is putting all the lessons learned from Yodle to work at Opcity, a real estate technology platform that provides real estate leads to vetted brokers. He is using data, analytics and pattern identification to make the best matches that will lead to brokers closing deals.
Recently, Opcity raised $27 million to roll out the company nationwide. It is hiring. It plans to go from 100 employees to 300 employees by the end of the year.
For more on how Opcity is going to create an even bigger company than Yodle, which Web.com bought in 2016 for $342 million, listen to the podcast.
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