How Aron Clymer of Data Clymer started his own services firm with a low-risk strategy and got not...

Hello and welcome to this episode of The Unnoticed Entrepreneur with me, your host, Jim James. And today we're going to Minneapolis in Minnesota to meet with Aaron Kleimer, who's a data expert and entrepreneur. Aaron, welcome to the show.

Thank you, Jim. Yeah, thanks for having me.

Now, a lot of people might think, oh, data, this is, you know, going to be numbers, but it's not. We're going to talk about how you've managed to build DataKlimber from a startup to 50 people in less than 6 years. So you've managed to cross the chasm from a startup to becoming a visible market leader. Tell us, Aaron, a little bit about Data Climber, and then tell us, you know, who you serve as a client base, and then we'll talk about how you've managed to build this business.

Yeah, just quickly, we're a services firm. So 100% professional services in the data space. We help implement data systems, data warehouses for usually mid-sized clients. So yeah, that's what we do. specialize in data professional services.

Right. And I know you had a background before, you know, in-house or working in a corporate role, and then you started Data Climber. Just tell us then, you know, you've built this business from zero. How have you started the business and what have been some of the obstacles that you faced in the beginning with getting the word out about your new business?

Yeah, you know, I think I have been a little more fortunate actually. It felt like it wasn't as hard as I thought it was going to be. I always think in retrospect, I wish I'd done it even earlier. But at the same time, my experience really helped. So I was in corporate America for 15, 20 years and, you know, really learned a lot about everything from management to building a team to internally promoting my team and myself, building methodologies, all of that. And I'd been in data quite heavily for a while and I'd just been thinking about creating a services firm for a long time, probably a decade of just kind of thinking through it, percolating it, you know. And I finally just found myself with the opportunity. It was my sort of in transition between jobs. And I thought, you know, maybe the time is finally right. And I went and talked to a vendor that I already had worked with as part of my corporate job. And I said, you know, I want to be a consultant. I want to learn much faster than I have. I want to see 50 implementations of a data system in the next couple of years, not just 2 in the last 10 years as I had. And I want to work with you. So, you know, I'm sure you have some clients that need some help. You know, here I am. And, um, you know, within 3 weeks I actually had my first client.

Okay, so Aaron, that's a fabulous and nice and low-risk transition, but plainly you're really good at what you did or else you wouldn't have made it quite so easy. But as you grow from a sort of personal brand, you know, connections into hiring people and getting leads coming in that are greater than you can do on your own, what have been some of the challenges that you faced in overcoming those problems as you scale the business?

Yeah, you know, probably the biggest challenge in my world, especially since I bootstrapped the whole thing, was always this balance of capacity to meeting demand, you know. And so it was a dance, you know, I didn't want to get in over my skis too much and land a client that was too large because I didn't have the team to support it. And yet, you know, I didn't want to have just very small clients that only needed a quarter of a person or half a person's time. So it's just this balance of trying to find the right clients. And on top of that, it was challenging because I wasn't really in full control over even sort of which clients I was targeting. I would really, all of my leads were coming through my partners and they would simply, you know, if they would have me in mind, once a client said, I need some help, I need some services, they would call me. So, you know, I kind of had to just take whatever I was given and make it work. So I think the biggest challenge was making sure I had enough people at the right time for the project.

Now, interesting, you talk really about the source of business being your partners, which is, I think, often overlooked by people when they start a business. Were there any things that you did, any activities that you did specifically with the partners that you think, you know, made a material difference to the well-being of the relationship and the deal flow that came in?

Yeah, absolutely. I mean, it— I definitely was thinking about how to keep my brand top of mind with my partners, specifically my partner Salesforce. You know, it was the sales reps who would be the ones who really, they would sell their product to a customer and then they would be the ones who understood the customer needs more help. And then, you know, they would be the ones to remember to call, you know, Aaron Clymer or Data Clymer. And so I would do things like if I could get any way I could get in front of the sales force, I would do it, right? So I would call my partners and see if I could speak at their quarterly business review or their annual meeting, you know, anything I could do to just tell some customer stories and joint customer stories really, and keep my brand top of mind within their organization.

I think, you know, that is really good. In effect, you've got a reseller team, haven't you, working for you? And from a marketing point of view, did you go in with them under their brand or were you already starting to build the Data Climber brand and How did the client feel about that?

Yeah, you know, in almost all cases, we were able to keep our own brand and simply be a partner. And that was because a lot of the partners that we had are their software vendors, you know, SaaS applications, usually business intelligence or data warehouse companies. And their business plan was not to get into the business of professional services. They actually did not want a large professional services team. I wasn't really competing with them. So they were happy to just introduce me as a separate company. Let me take it from there. So that worked out really well. One of my partners did have a subcontracting program where we would come under the umbrella of their brand. We did that for a while. I always thought that'd be a great lead generation kind of channel because there was a lot of these small projects. They were really just kind of onboarding, quick onboarding projects for their clients. But that actually ended up not panning out the way I thought it would be. You know, the rates were lower. We didn't get brand awareness on our own. So actually it's kind of a mixed bag on whether that, you know, worked out well for us or not.

Yeah. And I've joined experience with you on that where I partnered with a big organization going under their umbrella. And as you say, we've become really like an in-house department for them, right? And the margins were poorer. You've scaled the business though to 50, which from my own experience means organizationally there'll be some changes, but also from a deal flow perspective, that's now a lot of people to keep busy, isn't it?

Yeah, absolutely. Again, sort of in retrospect, again, it looks like I'm happy with the evolution that we took, you know, kind of not moving too fast, not moving too slow is the way I would describe it. You know, I think we just continually grew, but I didn't try to keep control of everything for too long. And I think that was the trick. The trick was at some point realizing, okay, delegation is the key. I have to delegate everything. I can't manage anymore. I need to be more of a strategic thinker. I need to be sort of the face of the company. I need to start totally transitioning my job. You know, at first I was the delivery person, then I was mostly sales and marketing. And through a lot of actually circuitous paths, I finally did hire a full-time marketing and sales team, but that was just this year. And so it's really just been this year when I finally transitioned into like fully delegating everything away from myself and being more of the face of the company. So I've gone through almost all the stages now.

Okay, look, and as you know, this show is about how entrepreneurs can scale and get noticed as they scale. So you mentioned some sort of circles that you went in there. And, and although you make it sound, you know, flawlessly easy, I'm sure there were some lessons that you've learned along the way. Do you want to share maybe one or two of the obstacles that you faced as you grew and the solutions that you found?

Yeah, absolutely. I mean, a lot of the way I grew was really opportunistic. So maybe that's one of the lessons is take advantage of opportunities or see opportunities as much as you can in the moment. So for instance, you know, as I had been thinking about, well, at some point I've really probably got to hire a sales rep or, you know, somebody who can help me generate our own leads and have a little more control over our own pipeline. You know, the opportunity kind of presented itself. One of the sales reps at one of my partners had actually just left and was unemployed for a few months and was trying to figure out his next move. And we connected and I realized, oh, this is a perfect fit. He's already in the business, in the industry. He knows our business essentially. He's young in his career, so I could afford, you know, to pay him not this huge salary and it'd all work out. And so he did jump on board and actually he was learning as we went too. We were kind of all learning together, but he had been in sales. And so we were able to build up a decent sales pipeline and that did work for about a year. It was working, but it wasn't a whole team, but it was one person that helped a lot, but he had to wear all the hats. He did marketing too. He helped our website. He did our website. He did our All sorts of other stuff he'd never done before, so he was learning as well. And at the same time, then we wanted to do more more like LinkedIn marketing essentially. I figured well I'll hire a firm to do that. I don't want to hire a whole team to do that for myself. Let's try a firm. It always sounds great. You're going to get five meetings a week, you know guaranteed blah blah blah. We hired a firm, and again that was that actually probably wasn't worth the effort. We did get meetings, but not very much conversion on those meetings, and. So I think I learned over about a course of a year and a half that, you know, as much as I can, having in-house people to do what we needed to do always seemed to pay off.

Aaron, you mentioned that, you know, you got this agency, they brought you leads that didn't convert. And why do you think that was? Was it a procurement issue? You didn't give them the right brief? Or were they just working on a basis of bringing you meetings rather than qualified meetings? What was the learning from that?

Yeah, I think it was that it's just really hard for an outside firm to really understand your business enough and be able to qualify exactly, you know, leads in the way that you need them to. And it's not their fault really. I mean, they were doing a good job at what they were trying to do. I think we tried the service out for about 6 months. If we'd given it a year, it might've, you know, it might've generated more and, you know, perhaps that could have worked out. But at the same time, the timing was off there because I found another person actually that was about the time that I hired my head of marketing, which also was again, an opportunistic kind of hire, the opportunity, you know, sort of presented itself. This person was available, they had a good fit. So I made a decision to just go ahead and hire and, and not use the external firm anymore. So it just kind of, again, a lot of opportunities come up and you make decisions quickly, and you move on.

So from a financial point of view, Aaron, what stage would you say it makes sense then to invest in the full time headcount of a marketing manager versus the variable, often lower cost agency. Did you work on that? I mean, I think you're saying that you're opportunistic, but I think you'll be, you know, underneath this very modest moment, you've plainly got a plan. You work in data, so you'll have figured this out, I'm sure.

Well, yeah, I think that every business is different. You know, it depends on your margin, depends on your fund, you know, how you're funded and all of that. But it For us, bootstrapped in services, it seemed to be about, you know, when we were $3 million, maybe $2 to $3 million in revenue, that's when it started to make sense to support a marketing and a small sales team. Yeah. So it's just a matter of kind of working out the math and seeing what you can do. And of course, you know, you worry about cash flow is always a problem, right? You always want to make sure you have healthy cash flow. And so we would do everything we could to support that, you know, get lines of credit from banks, you know, make sure we have a cushion, make sure we have some fallbacks. Because yeah, it's in this business, you always have to worry about cash flow. So we were able to do it. There were times when we thought we would need those, we actually ended up not needing a lot of that. We got very close sometimes.

So often what happens is a company will hire someone as a marketing manager, and then find that the overhead doesn't, you know, translate into direct revenue increase, you know, especially in a service business where you maybe have 3 to 5 times, you know, a multiple in terms of cost to revenue. What sort of budget can you give the marketing manager? Because it's not just the salary, is it? They need the money to attend trade shows or build out websites or get involved in chatbots. What can you make— don't have to give us the actual numbers, but percentage-wise, can you give us some ideas?

Sure. So, you know, generally in services, your net margins, you know, there's a pretty wide range, but you want to be at least, let's say, 15% to 30%. is the way I say it. If you can keep your cost of marketing down to 3 to 5% and sales maybe 10 or 15% in terms of cost of those businesses, then it works out. You can still maintain those net margins that are still profitable.

Okay. Yeah, because that's often the problem, isn't it? When in a service business, people hire a marketing manager and then they worry about, you know, where's the revenue coming from? So with the marketing manager, what's their role now? Because it sounds as though you've moved role as well and going from, if you like, direct selling to brand building. Aaron, can you just tell us the strategy behind that for Data Climber?

Yeah, and I wanted to do sales and marketing in parallel because they're so intertwined, right? You need marketing to be able to support sales with a lot of content, a lot of customer stories and so forth, and vice versa. You know, you need a good tight relationship there, and I knew that both of them were going to feed off each other. So we actually invested in both sales and marketing about the same time. And we built up a larger sales team, again, knowing that there's a good chance that they're going to be able to, you know, in effect pay for themselves in a shorter amount of time. Marketing definitely takes longer. We just, again, we had just enough runway and a big enough company by the time we did this, again, $3 to $4 million. And then since we've done that, we've doubled in size, actually. So it's definitely, you know, the margins are still there, and we're still able to support the team. And I'm sorry, wait.

That's terrific. So when you say you've doubled in size, well, I was asking the question about The difference in role that you play now, because as the entrepreneur, you know, when there was one of you, you're doing a bit of everything, standing up in front of your sales partners and so on. But now as the CEO of a 50, 60-person enterprise, you have a different role to play. So I was wondering from a, you know, getting noticed perspective, Aaron, what you're doing differently and what role you're playing now.

Well, first of all, it's been immensely helpful to have A full-time marketing team because our brand awareness has really shot through the roof. When we started the journey, before I had hired these teams, we only had about 300 LinkedIn followers, for instance, on the company site, right? Fast forward to 9 months later, we're over 1,000 followers and we're on the way to 1,200 followers by the end of the year. So that's 3 or 4x just brand awareness on LinkedIn, for instance. So to be able to churn out, just get really active on LinkedIn in general, have a lot of content being posted per week, doing webinars, doing ebooks, doing all this stuff that I just didn't have the time to do myself has been huge. So I was doing everything I could before that. Although I wasn't as active on LinkedIn as I think most entrepreneurs, that was probably one of the blind spots I had. I was just too focused on the business and I kind of wish I'd done more of that earlier on, but that all has been really helpful. So I'm thinking about what, you know, what I used to do before that. I tried to get, again, I was leveraging partners more. So again, I would try to push any kind of webinar that I could join with a partner. with a customer, speak at conferences, absolutely put out blogs. I mean, I was writing a lot of blogs. I had my whole team write a blog, like one blog a month. So I was trying to distribute the marketing across the team we had, which was mostly engineers.

So Aaron, you were motoring along quite nicely with, you know, all these staff and organic inquiries. But what made you decide to make the investment in Marketing?

Yeah, you know, it was really the deal flow through partners was just unpredictable. And it felt like I couldn't guarantee, you know, what the sales pipeline would look like a year or two down the road. You know, our space is very crowded. There's a lot of systems integrators and services companies like ours, new ones pop up all the time. So how the full sort of deal flow from partners would be divvied up between all of these services companies is very out of my control, and I wanted to have more control over our destiny. So that's why we invested in sales and marketing to build out our own sales pipeline lead funnel that we could have— we could predict much sort of more accurately what sales would look like down the road, and therefore hiring plan would be much more stable.

Yeah, that's great. So you go from being reactive to being proactive and being in control. That's a wonderful answer. Yeah, which must have made interesting reading. Now, this If there's one lesson, one key takeaway that my fellow unnoticed entrepreneurs and I could take away from you on, you know, building the brand out and crossing the chasm, Aaron, what would that be, do you think?

You know, I think I would say fail fast, fail fast in everything you do, especially in marketing as well. You know, try a lot of different things. It's perseverance, right? Fail fast and persevering because you will figure it out and expanding your network, talking to other entrepreneurs. You know, that's probably another thing that I didn't do early on, I'm doing it now. I'm so grateful I'm building more of a network of my peers because you just learn so much. I mean, this podcast is an excellent example of that.

Great, Aaron. Yeah, thank you. And thanks for coming on and sharing your journey in such a transparent way as well, because as fellow entrepreneurs, it really helps to hear from other entrepreneurs who aren't selling something but are really just sharing some value. So Aaron Kleimer, if people wanted to find out more about you, where can they do that?

Oh, that's our website. It's Data Climber. I was able to use my name and the domain was available. It kind of worked. There's a lot of analogies we use about climbing to the top of your data, getting on top of your data. So that's spelled Climber, C-L-Y-M-E-R. So dataclimber.com, and you can learn all about us there.

Aaron, thank you so much for sharing. So for my fellow unnoticed entrepreneurs, you've been with Aaron Clymer, founder and CEO of Data Climbers. He's Just share with us and with me, Jim James. Aaron's in Minneapolis. I'm over here in wonderful Wiltshire in the west of England. And if you've enjoyed this show, do please share it with a fellow entrepreneur. If you've really, really enjoyed it, then do please review it on your favorite listening platform, either Spotify or Apple Podcasts. And until we meet again, I wish you all the best. And just remember, keep on communicating. Thank you.

Thank you.