Preview: “Most every time we have received a return on the investment in the relationship because we have earned people’s trust.”
Recently, I asked y’all to share your stories of investing — expending time or money with the hope of payback/ROI, but without the guarantee of payback. Here’s a list member story from Eric Jones. The rest of this email is that story, italicization and indentation avoided for the sake of readability:
We have invested hundreds of thousands of dollars into three different SASS products for clients in the industries we serve. Two have given us only a break-even return and the last we just plain lost our shirt. I’m still hopeful that my company will continue to develop expertise so that we can build a profitable SASS business one day. There are however two areas where we have made investments that have paid off.
- Relationships. We have always focused on building close relationships with our clients. One way this plays out is being very fair in terms of billing. If projects go over budget we always work through it with the client and even eat the costs ourselves. In the short-term this has been financially draining. However most every time we have received a return on the investment in the relationship because we have earned people’s trust. One example is a large custom software application we built for a client. There were some features that we didn’t define clear enough in our contract. They expected these features to be built and so we did the extra work which resulted in a major loss for us on the initial project. Ten years later, they are still one of our largest on-going support contracts. In one year of support we make as much as we lost on that original contract.
- Support. One problem in the technology consulting industry is that agencies tend to want to move on to the next project and not provide ongoing support. We made the choice in our business to always try to enter into support agreements with our customers. Early on this was difficult because we didn’t have the scale. But as we have continued to invest in this area of our business over 15 years, the scale of it has led to a very profitable portion of what we do. We know these customers very well and we don’t have to re-sell them on our services. We sell them each and every day by providing them outstanding ongoing support. This year our support business has passed 50% of our total revenue. The scale of this service helps us provide an incredible value to our clients and it brings us a profitable stable business year after year.
The lesson is that you have to stay the course with a long-term perspective. Not months or years, but decades. When you continue to build and learn and grow over a decade, you will receive a return. It is the only way I know to create a future where the conditions will always bring the result you want in the end.
Share your story/stories of investing: https://airtable.com/shrms0EL2e7NYL3SW