Getting Customers and the Product Lifecycle @ ReviewPro

Last Wednesday we talked with Ronald Friedlander from ReviewPro, an online reputation management software for hotels. In this lecture that focused in getting customers and the product lifecycle, Ronald talked not only about this but also about his motivations to become an entrepreneur, the opportunity he saw, the idea, and its implementation.

Ronald has been involved in other startups before and even though he has friends running new ventures he says that becoming an entrepreneur is not as easy as you might think and that many have good ideas but are not prepared nor take the steps required to implement them. This is very true since if you want to make some money in the beginning you better do most of the things yourself and smartly, also execution is what makes your plans come true.

Ronald took a step that most of us in a MBA have thought of which is to leave the corporate world and start your own business. While not every time this is necessary like we've seen with the guys from Todotaladros, who still act in the large enterprise world, this sometimes is the only way and Ronald asked us: have you guys seen a social network owned by a big organization? Well, even though Google and Facebook are big now they still try to keep the startup atmosphere alive. For how long they will sustain this, oh that's another question.

I was talking to some colleagues here at IE, and most of us agree that the idea to create an online management reputation tool for hotels was really powerful. People not only book most of their hotels online in tools such as Booking.com or Agoda, but most importantly read what other visitors have to say about their experience and are willing to also provide theirs when they come back from their trips. On the other side is in the hotels interest to manage their reputation and to improve their capacity utilization with this information and that's when ReviewPro comes in. I know everybody is gonna mention it but I couldn't avoid putting here a quote by Warren Buffet, Ronald mentioned:

"It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently" Warren Buffet

Since in 2007 there was no tool able to show in one place what people were saying about the hotels they went to, Ronald joined two more guys and started ReviewPro. Apart from investing on his own they also obtained external funding and even funds from a government grant. This was actually the first time someone mentioned about getting funds from the government since mostly we talked either about bootstrapping, angels or VCs. Personally I was giving a look at the Brazilian National Development Bank, BNDES, and they offer very interesting funding opportunities compared to traditional banks.

Ronald talked about his obsession with the product and how that helped ReviewPro to get their first clients and still helps them today with constant product innovation. For that he guaranteed from the beginning that there would never be lack of resources to manage and develop the product. Here I think it's important to balance both marketing trends, your competitors and what you do internally to make sure you're adapting and creating value. A article that I like about this topic is Theodore Levitt's Marketing Myopia, that discusses the mistakes some large corporations did in the past in product development by looking only internally.

About client acquisition Ronald mentioned that they never gave anything for free since in his opinion that destroys the value of the product. There's a lot of personal effort from him in getting in touch with large accounts that have account managers and they use telemarketing for smaller accounts. One thing that helps here is that for being an online tool in as much as 5 minutes anyone in the company can show you what the product does and mainly that more than just showing how your hotel is rated, the software does semantic analysis what allows hotel management to understand what their problems really are. According to Ronald the real value is not in a business plan, but on what you can do for your customers, and here they can show it clearly.

Well folks, that's it for this class, unfortunately it's all coming to an end and tomorrow I won't be able to go to class but I hope these memories can help you readers as much as their helping me on my potential venture thoughts.