Two hundred and fifty companies have successfully used SyncDev to develop new and next-generation (N+1) products, enter new markets, start new businesses, and improve their acquisition track record on both the buy and sell side. Read a few of their stories below.
- N+1 Development
Adobe Systems, Inc. is a market leader in print and web-development software that deployed SyncDev into several of their business units. Adobe acquired Macromedia, who had, a few years earlier, failed badly with a new product, learned a valuable lesson, and began to use SyncDev to launch new products. Bruce Chisolm, CEO of Adobe, bought Macromedia for “it’s people, products, and proven business practices”, one of which was SyncDev.
Dreamweaver, their mature market-leading webpage layout software, had a highly experienced team developing release 6t. Having developed several successful releases before, the team planned to add nine big new features. SyncDev introduced the team to the R&D Test, a conjoint analysis for specifying the Minimum Viable Product.
Based on the results, the team pivoted and abandoned all nine planned new features, opting to refine what they had in version five based on the demands of the market. Release six became the most successful one to date. Adobe rolled out SyncDev for developing next versions of Flash®, Flex®, Flame, and many other products.
- New product development
- Campaign Selling
- Buy-side M&A
Advent’s first portfolio management software product propelled the Company to success in the 1980s, but management knew many companies stumble on their second product. The CEO decided to use SyncDev on their second product, a trade order management system, Moxy. Their CFO noted, “Moxy was stalled until we started SyncDev.” During over-the-shoulder SyncDev design reviews of an early prototype, three customers noted, “There are a lot of clicks.” That sent the design team back to the drawing board, contributing to Moxy’s first-release success. Advent used SyncDev on each new product after that: Geneva, Rex, APX, Partner and others. All were successful products on their first release and beyond.
Once Advent went public it used SyncDev M&A for late-stage acquisition due diligence and early-stage integration. When Advent signed a letter of intent with an acquisition target the latter had four customers and one prospect. Two customers were using the product. When the transaction closed, the newly acquired business had already grown to seven customers and 21 prospects.
A year later Advent had 35 such customers. Synchronously acquiring a company, acquiring customers, integrating the new company with the management and field teams, and optimizing the business model was instrumental to this success.
“We haven’t made a single product mistake,” the CEO, Stephanie DiMarco, said years later.
- N+1 Development
The eight-member Ancestry.com design, engineering, and marketing team, led by a product manager kicked off SyncDev to test their next-generation service specifically to see if customers would buy optional data-product add-ons to their basic service.
The team met with 22 customers, men and women over 50, at their homes. By June 30th, they had revised their design several times based on feedback.
“I wouldn’t buy this Civil War database for $95. The wording is too vague to know if my Georgian ancestors would be in it,” a customer objected upon seeing the web page for it.
The web designer, sitting in the back of the room, typed on his keyboard. He might have been taking notes.
Fifteen minutes later he asked the customer to refresh the products page.
“Oh, yes. I would definitely buy that,” she said.
Instead of taking notes, he had redesigned the page, uploaded his new design using her Wi-Fi, and got the customer to refresh it.
In essence, the team saw a problem, designed a fix in real-time, tested, and then implemented it. Had the team not been able to sit side-by-side with the customer, the issues that were raised may never have been detected, let alone fixed.
Infinitek, a Silicon Valley start up, was developing a drug-discovery lab robot for use in biotech and pharmaceutical companies like Amgen, Genentech, Pfizer, and Merck. It had so far developed a pre-production prototype. Infinitek’s venture investor faced making a major investment to launch production and scale the business.
Just to be sure he wanted answers to four questions:
“Is the market real?
“How big is the market?
“Does the product fit the market?
“What are the sales costs?”
SyncDev ran from May 1st to June 30th. The core team — management, scientists, engineering, and marketing, had test-sold the Biomek to 35 biotech and drug companies one-by-one on their premises. Most were major brands. The team found thirteen Charter Customers in 60 days. Genentech and Chiron made cash down payments to secure early access.
Investors funded the company on the basis of it becoming a $100 million company in five years, at the time the traditional benchmark. But when the team extrapolated their experience with 35 prospects to the market as a whole, including the international market, they could make a case for only $35 million in five years.
The product also wasn’t a pre-production prototype. It was more like a breadboard and required two more years of development.
Investors decided to sell the Company. Forty-five days later, on the strength of their ‘virtual backlog,’ i.e., their pipeline of validated prospects, Beckman Coulter ‘(SmithKline Beckman at the time) made the first of two payments to buy Infinitek. Beckman put its sales and relationship management team on it and converted early prospects into scaling customers.
Five years after the market launch the founder of Infinitek, then Beckman Coulter’s robotics general manager, said, “We beat our plan by six percent. I know because my bonus was tied to it.”
The Biomek® is now a global brand.
$1.8 billion market leader in CAD and data for architectural and product design, media, and entertainment
- New Product Development
- N+1 Development
- Buy-side M&A
Autodesk started out in two-dimensional computer aided design (CAD) software that they sold through dealers for $2,500 per seat. A few years later they needed to expand into 3D CAD, seemingly a straightforward transition.
The 3D team spec’d what they believed was their Minimum Viable Product but SyncDev proved otherwise. Autodesk did not have the required know-how to reliably design and code must-have features.
“SyncDev saved us hundreds of thousands, maybe a million dollars, by not bringing out the wrong product,” Ruth Connelly, the CAD unit co-GM said. Instead, Autodesk bought a company whose product already matched the spec they had validated with SyncDev.
Separately, a data-management product team used SyncDev. They test sold their product to four customers in Detroit for two days. At the end of the second day they were late for a night flight to Rochester, NY and were unable to debrief.
Aboard the flight, in a darkened airliner cabin, John, the chief engineer typed feverishly on his laptop under the overhead light.
“John, can I gather the team around to debrief today’s meetings,” the team’s SyncDev coach asked.
“Not now,” the engineering manager grumbled. “I don’t want to get beaten up tomorrow at Kodak like I was for the last two days.”
Had it not been for those cold-water-in-the-face meetings in Detroit, the team may never had discovered those design problems. The fix was uncontested and completed before the next meeting.
A private manufacturing- execution software company which specifies and tracks the operations performed on fabricated parts and assemblies from raw material to finished goods.
- Campaign Selling
- New Market Development
Camstar had successfully penetrated the electronic-device manufacturing software market, but market growth was slowing. They decided to augment it by entering the medical device market. They used Campaign Selling to kick-start the program and assigned a general manager to lead it. Two board members and a SyncDev coach flew into Charlotte for a late afternoon kickoff meeting with management and the market-development team on December 7th.
“Let’s reconvene tomorrow morning at 7:00 AM and start cold calling to set meetings for the week of Christmas,” their SyncDev coach said.
“There’s no way we can get meetings that week, especially when we don’t know anyone in that market,” the marketing VP said, objecting strenuously.
Lining up behind the SyncDev coach, the sponsoring board members overruled the naysayer.
The Tuesday before Christmas at 2:00 PM, Camstar’s five-person team met with the Decision Making Team™ at a large market-leading, public, medical-device manufacturer in Boston consisting of nine manufacturing, quality, and IT executives.
When the meeting ended at 6:00 PM, Camstar’s team knew what to fix in their pitch over the holidays. They also knew first hand by title whom to invite to their next meetings.
In mid-January, the team met with six brand-name medical device manufacturers in the target-rich Midwest. By April, they had started relationships with those manufacturers who together constituted over half the US market.
Today, Camstar is a major supplier of MES software for the US medical device business.
Stanford Professor William Sharpe won the Nobel Prize in Finance 1992. In addition to teaching he was also a practitioner — a pension consultant to CALPERS, HP, and AT&T. His investment algorithms worked so well that he began codifying them for consumers, 401(k)-program participants. Soon he founded Financial Engines to bring them to the consumer market.
“What do we build? Who will buy it? How do we sell it,” his CEO, a just-graduated, Stanford MBA recruited from Professor Sharpe’s class asked.
Sharpe’s cofounders were the Venture Law Group founder and a former Reagan SEC commissioner. They and blue-chip venture capitalists, including a founder of New Enterprise Associates were co-board members with the founders. The collective wisdom then was to sell it directly to consumers as an investment advisory web app to current 401(k) participants.
The day the company was funded the CEO called SyncDev to schedule a kickoff meeting for the next day.
The first morning the three-person team sketched out the web interface on a whiteboard. It would become the ‘Validation Prototype,’ mockups that would be the centerpiece of customer meetings.
The team set up a ‘wave’ of six back-to-back meetings with six consumers, two per day. They and their SyncDev coach often met with husband and wife, one by one, in their homes typically over the dining room table or in their study.
After getting to know the customer and reviewing the product, the CEO asked a series of trial close questions. The upshots of the responses were, with a high degree of consistency, that they would like to get the product from their employers as part of their benefits package.
Therefore the next wave of meetings was with compensation and benefits managers, legal council, and treasury personnel at mid-size and large employers. They liked the offering for several reasons but told the team that they would have to collaborate with their 401(k) administrators to decide for sure.
The next wave of meetings was with TR Price, Vanguard, State Street, and the like. They too liked the idea but advised that the team meet with pension fund and benefits consultants like Mercer, Hewitt, and Putnam.
Traveling with Professor Sharpe to see financial service firms was like traveling with a rock star. More than the average number of people turned out attending our meetings.
Still, the business-model labyrinth wasn’t complete. As FE’s product took shape it became clear that its software would recommend specific mutual funds to buy and sell in specific amounts. That required that FE software become an “SEC registered financial advisor”. The strategic direction, product spec, and business model were established within a few months of the kickoff meeting, but it would take a year to get the SEC and Department of Labor on board. FE launched their service to employers with the help of financial institutions and consultants.
Over the ensuing years Financial Engines implemented refinements to their business model and in March of 2010, following the worst economic year in recent memory – 2009 – Goldman Sachs took FE public after growing 20% that year and hitting $100 million in revenue.
“SyncDev is our development DNA,” said Ken Fine, EVP, Marketing.
An important sidebar to this story is that FE stumbled once with failed market initiative in which they did not use SyncDev. In the midst of extracting themselves from it, Ken and the CEO coined a term that is a cornerstone in SyncDev, “Nail it. Then scale it.”
$7 billion dollar spin-off from Motorola that manufacturers memory, microprocessor, logic and other semiconductor devices.
- Campaign Selling
- New Market Development
- N+1 Development
CodeWarrior IDE was a popular software development tool that Motorola had acquired from Metrowerks. Motorola used Campaign Selling to acquire new customers for the current and next generation product. Success here led Motorola to adopt Campaign Selling across all four Motorola Semiconductor business units: automotive, networking, telecom, and industrial. The SyncDev team covered three continents and forty prospective customers over four months. Motorola concurrently spun out their semiconductor division into Freescale Semiconductor.
Motorola had a reputation for bloating and over-engineering their products with features. With Campaign Selling they validated they already had the Minimum Viable Product™.
The success of the CodeWarrior team spawned additional initiatives inside the automotive and industrial divisions of Freescale. Ross Mitchell a European GM, was initially skeptical of SyncDev but summed up his experience saying, “That wave in Italy and Germany paid for itself 50 times over. We discovered the “minus features” [features that customers say they don’t need and therefore serve only to bloat a product], those we thought were needed but weren’t. Removing them saved us millions of dollars and enabled us to recoup eighteen months of development time.”
Results like these have led to several SyncDev applications at Freescale.
Market leader in teaching English globally over the Internet. Acquired by Pearson Learning Systems.
GlobalEnglish was formed to teach reading, writing, and speaking English to employees of companies in countries whose native language was not English but who did business with English speaking countries. The founders recruited a small team of language-arts experts from their former company, The Learning Company.
Within a few days of initial funding the team conducted their SyncDev kickoff meeting. For two days they hypothesized their market and brainstormed “Wow!” features for their Validation Prototype™. Next a design team made storyboards of software screens, as customers would see them in the finished product. They would be used at SyncDev meetings with prospective customers to test sell the product to companies.
One team member, a Harvard MBA fluent in German, volunteered to set up customer meetings in Germany. While he did that, the SyncDev team of language experts, designers, and engineers conducted “off-Broadway” meetings in San Francisco at two language schools with their students to iron out kinks in the pitch and demo.
Three weeks after the company was funded the four-person SyncDev team landed in Frankfurt on Sunday for a week of business meetings with human resource managers and staff at Daimler Benz, Deutsche Bank, Deutsche Telecom, BMW, and two language schools. We also met with consumers who were friends of German friends who were studying English in Germany. The third meeting was in a small conference room around a small wooden table at BMW headquarters in Munich. The four Global English people sat facing the four Germans. When the meeting ended the BMW people in unison began rapping their knuckles loudly on the table.
“What does that mean?” one GE person asked.
“Applause. Danke shön,” the BMW team leader said, spurring the team on.
Each day the team met with two companies and two independent-study students one by one. Often the team took a train at night to the next city for meetings the next day.
Thursday night after a quick dinner the team met at 9:30 PM, in a professor’s classroom with his students to discuss the Global English system.
Thirty minutes into the meeting the German-speaking SyncDev team member who had set all the meetings and constantly managed the team was sitting straight up in his seat. His fingers were on the home base of his laptop keyboard ready to type the next word spoken by customer into the SyncDev Voice-of-the-Customer Database™.
The problem was that he was sound asleep, exhausted from his work of the last three weeks. GlobalEnglish dodged the dot.com bust that came early in their fragile life. But it nonetheless pivoted. One was away from the well-served European market and toward the Asian and South American markets where there was far less competition. This pivot might have come sooner if the team had validated in all three of these markets initially. This would have exposed the Asian markets as having highest return on effort of the three.
Another lesson was around the Minimum Viable Product™, a SyncDev product-planning concept that had not materialized by the time GE started. In fact, product brainstorming was unconstrained and focused primarily on “Wow!” features. That may have led to early versions of the product being overly ambitious.
Nonetheless, brainstorming is always good but it must periodically be rationalized to check that a given release has only those features in it with the highest return on risk.
- New products
- N+1 Products
Informatica had been pigeonholed as a “flat” company in the data warehousing industry.
When Sohaib Abbasi took over as CEO from the founder in 2004, he set out to fight this perception and expand the company into higher value data integration products to augment its PowerCenter flagship product.
At the suggestion of a Board member, he used SyncDev to kick-off four major new products. Since he took the helm, the Company has doubled its market capitalization and revenues.
$2.8 billion market leader in personal and small business accounting and investment data and software
- New product
- New Company
- Sell-side M&A
Personal News, Inc., a start up, used SyncDev to develop a new-to-the-world financial software and data product for consumers, which Intuit bought after a battle with Dow Jones.
The founders of Personal news were a garage-based start-up. They thought amateur investors wanted a daily, personalized stock newsletter that would be automatically printed out each morning ready to read over morning coffee and share with friends, family, and coworkers during the day.
One of the two founders had been a producer at The Learning Company, and decided to use SyncDev in his new endeavor. In their first wave of meetings with consumers, they found that customers wanted not a newsletter but a real stock research and portfolio management tool like the pros have.
They redesigned their software accordingly. Their biggest pivot was deciding to focus on fundamentalist investors who used information about companies to invest not technical investors who used price and volume chart patterns to invest.
On that basis they knew they needed data and would have to approach Standard & Poor’s, Dow Jones and others to get it. They also needed an interface to Quicken. The founders approached all of them as prospect partners.
After their pursuit of Dow Jones and Intuit ripened each company told the founders that they didn’t want to partner with them. Instead each company wanted to buy Personal News, right then and there, even though their product wasn’t ready to ship and before they had a penny of revenue.
Intuit won. The founders and venture investors cashed out early. Intuit integrated the product, Investor Insight®, into Quicken Deluxe® and Quicken.com®.
Over the next few years, the functionality that PNI invented at the feet of customers became a commodity, built into CNN Money, Yahoo Finance, Google Finance, Schwab, and virtually every other web site that offers financial services, data, and news.
- New Products
- N+1 Products
- Buy-side M&A
A major semiconductor chip manufacturer was angry when KT showed them their completed third-generation inspection system that spots microscopic flaws on wafers. “How dare you design without consulting with us, especially when it’s missing a critical feature, off-line setup.” KT lost their business as a result.
KT’s new President invited SyncDev to present to his business unit managers and VPs. The inspection system business unit manager decided to use SyncDev for his fourth-generation product, a two-year effort to develop a new hardware platform and improved software.
The SyncDev coach visited with the development team in Israel in October to socialize the new process. The SyncDev kickoff was held in early November. It included the product manager, two Israeli engineering managers, applications, and a software designer who would also run the demo in the customer meetings.
The first wave of meetings was with five US customers the week before Thanksgiving. On Monday in San Jose, UltraTech Stepper asked, “Where’s the off-line setup?”, the feature that was missing in the previous release. That night the team flew to Boise, ID and the next morning 17 people at Micron asked the same question. Tuesday night the team took a red-eye to JFK. Wednesday morning they boarded a commuter plane for a flight to Burlington, VT.
“Where’s off-line setup?” the IBM manager asked at 12:00 noon.
The team explained that their schedule was mandated engineering and operations and that they would be unable to include it in the release.
“You guys have no credibility,” IBM told the team angrily.
Leaving IBM, the Israeli managers argued in the van. “Listen to my two engineering managers,” Mark, the Product Manager who was driving said to his SyncDev coach in the right, front passenger seat. “Before they couldn’t do off-line setup. Now they’re arguing about how to do it.”
Thanksgiving came and went and the team did another wave of meetings the first week of November. Their first meeting was with another IBM division, not far from the one in Burlington.
The team started the meeting. IBM asked right away about off-line set up, a feature that enables the inspection system to be reprogrammed while it is inspecting a batch of wafers. He may have known to ask from his Burlington colleague.
“Gentlemen, this meeting is over,” the IBM host said. “We don’t want to hear about your technology or product roadmap. Nothing until you come back with what you know we want.“ The meeting was over in 30 minutes. The team packed up and left.
At dinner that night the team started over. They deferred the new hardware to a later date so they could concentrate on implementing off-line setup, i.e., the Minimum Viable Product™.
From that point forward, things went well as they visited customers in China, Japan, and Korea.
By February, the team had validated a new spec and returned to IBM. They presented their new plan for the product they wanted.
“We don’t like where you are, but we like where you’re going,” the IBM manager said. ‘We’ll take two more units of your product that we don’t like. When the new product is ready we’ll replaced all seven of the old units with new ones.”
The microprocessor manufacturer that KT had lost resumed buying again.
Two years later, KT’s inspection unit had advanced its market share from forty percent to seventy percent and put seven of its twelve competitors out of business.
The Learning Company
A $65 million dollar producer of major children educational software brands: Reader Rabbit
- Package design
In its heyday The Learning Company was a new-product factory, producing multiple learning-software products for children per year. The chairman and principal investor decided at the outset of his involvement with TLC to use SyncDev for all products as a business-practice standard. “If we do nothing but get the positioning, box, and price right, we can add ten or fifteen percent to the top line. Ninety-nine percent of that falls to the bottom line.” And getting the box right was tantamount to spec’ing the product in terms customers could understand.
The core product team consists of a producer (product manager), designer, engineering manager, and marketer. At kickoff, they decide the 1) target demographics of customers, 2) number and types of consumers, prospects, teachers, and schools to meet with, 3) how they’ll find qualified prospects meet, and 4) when to meet. They identify and recruit by using product registrations, store and mall intercepts, referrals from other customers and prospects, and by hiring an agency that advertises and screens for target profile people. The team spec’s the product and then uses the box as a Validation Prototype spec.
The team meets with the customer’s ‘Decision Making Team’. In this case that’s a mom or dad, both along with one or two children, or sometimes the whole family. They meet in their homes, schools, stores, and mall meeting rooms. Non-core team members attend too, expanding the group to six or eight of those who meet with the DMT.
The team never meets with more than one consumer at a time. Meetings last for as long as young children can focus. That’s typically one-and-a-half hours in which the core team is focused on just one single customer unlike focus groups that spread the same time across six different users who are not DMTs. In the meeting, the engagement becomes quite granular.
“Mom, …Dr. Dread scares me,” a child said referring to a small thumbnail image of a software screen and the face of a small character on the back of the box.
“I’ll take him down a notch,” the designer said afterwards. In other words, some customer objections are so logically compelling that the team uses their collective instant judgment to make a change.
Nearly every product made the bestseller list. Most made the top ten. None failed, an impressive feat for a consumer product company. The Learning Company went public, grew rapidly, and was acquired for a record-high all-cash price as measured by multiples of sales and earnings.