Listen to Your Customers to be Successful.
What are two business skills you need as an entrepreneur? Finding a niche and adjusting to customer needs. Listen to today’s show to hear examples of this from Gary Eisenstein. Gary is the CEO and founder of Falcon Software and CMSC Media. Learn from Gary’s stories and experience as he created businesses that met the needs of his clients. Find out how you can use flexibility to your advantage!
“The I.T. world always seems to provide new opportunities for us to capitalize on.”
-Gary Eisenstein
Timestamps:
0:54 - How Gary went from an AV consulting company to a wire and cable consulting firm, eventually developing a catalog for his customers
4:28 - The problem with Gary’s business: How Gary learned to find untapped resources and adjust to the needs of customers
7:50 - Leverage your entrepreneurial spirit! Why Gary decided to sell his already successful business and pursue a more risky route
12:56 - Why the service-based model became Gary’s ideal business model
14:46 - Going from a catalog software service company to a website design company: Why Gary’s adaptability gave him an edge in the niche he entered
18:04 - The key component to business that you need to listen to in order to stay ahead of the competition and maximize your niche
20:48 - Transforming a monthly blog poll to a daily industry news portal site and how CMSC Media has grown to regular record-setting success
24:45 - What you can do to listen to your customers more closely and create a product that caters to their needs
Connect with Gary:
Transcript:
Jon Voigt: Welcome to agile living the entrepreneur's journey. A show dedicated to discovering how entrepreneurs and digital leaders are doing more with less. I'm Jon Voigt. Your host and CEO of Agility. And we're on a journey across the country to learn from top digital entrepreneurs on how to live a more agile, adaptable, and fulfilling life. Thank you for joining me today.
Jon Voigt: And let's dive in.
Jon Voigt: Welcome everyone. I'm excited to have Gary Eisenstein on the show. Gary is CEO and founder of Falcon software at CMSC media.
Jon Voigt: We met for lunch a few weeks ago and I learned about his amazing journey from business to business. It was such an inspiring topic about his ability to adapt and pivot his business years after years into new value added services for his customers. Gary thanks for being on the show. And perhaps we can just start right at the beginning on how you started your first business.
Gary Eisenstein: Well thanks for having me on the podcast John. My journey began way back in the 80s mid 80s so it all started for me with the company I founded in 86 which was a home theater consulting firm being a high five audio studio. I had a knack for designing cool theater setups. So what I decided to do is reach out to local luxury homebuilders and audio shops in the area to see if I could carve out a living doing what I love to do which is all things audio. And at that time there weren't places like Best Buy or Amazon where you could instantly purchase a plug and play home theater setup. Back in the day they did quite a lot of designing inspecting and complicated installation work. So I inserted myself as this guy that would make sure everything was set up properly and wired correctly and the AD hardware mashed up with the budget and expected performance. So that was kind of the start. And you know as time went by, I was working with this Pittsburgh based wire manufacturer helped develop a highly flexible audio table that would be installation friendly and affordable. The cable I designed was such a big hit that it eventually brought in more revenue and I was making from the consulting fees.
Gary Eisenstein: It kind of hurt my ego but it paid the bills.
Gary Eisenstein: So I got over that but as a result what I did was that I dissolved the company in 88 and I start up a new company called West Coast Wire which allowed me to focus on what I saw...
Gary Eisenstein: At that time was an untapped market brokering specialty electronic wire and cable products.
Jon Voigt: Were these all cables you guys created like the original one or you just decided to start distributing them from all sorts of sources.
Gary Eisenstein: Good question. It does seem that we were using this cable that I designed and had made up for me for my own use but my brethren would call me up and ask me if they could buy it as well and all A.V. shops locally were buying this this particular wire and cable product and then they started asking me questions such as well can you find me some computer cable or can you find me this particular electronic cable for a very specific application. And you know I'm a very much a yes man back in the day so sure I'll do it and I hang up and I try and find a solution. And so we were really making a lot of money compared to the consulting fees and just reselling the wire and cable. We brought in for everyone not only stuff that we're using ourselves. So that's how that all started and just made sense at the time that I flipped gears and go from AB consulting company to a wire and cable brokerage firm right.
Jon Voigt: You always became a thought leader in that space and they trusted you like you know you can make this one cable I trust you to pick any cable for me.
Gary Eisenstein: Well yeah very true. But what really attracted me is the business was so simple. Customers phone me up and asked me to source a particular specialty cable.
Gary Eisenstein: I sorts it out by connecting with over 50 different distributors and manufacturers across North America. And I just find the best match and the best price. I added on my finder's fee to the overall price and dropship to the customer's location and down to their business. So it was a simple operation and I just ran it out of the betterment of my home. And you know the internet didn't exist at that time so companies really leaned on me to find what they needed. I was their Gary the Google. But here was the problem the company that I found as I was going into year 2 was the time it took going through all the dozens and dozens of product catalogs to find what my clients were looking for. So I decided to seek some help from the computer guys that I knew and come up with a master digital database of all the major electronic wire and cable products so I could simply type in the customer specs in a matter of seconds and have options to source that normally take me say 30 to 40 minutes to find. So this was a huge advantage for me and it would get back to the customers with the products they needed before they found someone else.
Jon Voigt: Because I guess they request something but they may keep looking while you're looking if they found something first you'd lose that business.
Gary Eisenstein: Well yeah. My direct competitors at the time were working off product of the shelf. I did not have any stock of any sort. I just found product, figured out the cost to get it landed in the way I went. So that although you know I had a lot of more options than my competitors did because they were stuck with what was on the shelf they could fill in order immediate where it took me time. So I had to be really fast in getting that needed order or I'd lose it. And that's where the age of the computer was just starting to become useful in businesses. And so I jumped on it and took advantage as well after using that particular database we developed for about a year. It hit me why not create a catalog on this with all this information and format it that looks like Microsoft with GUI interface and not only sell it to my local customers but make it available North America wide. So I thought well if this was a problem for me, people from any other companies are outsourcing wire and cable brand, would this be an attractive product for them to use? So that's exactly what I did. I sold West Coast wire made some good money off that sale back in 93 and I lived off the cash while development of the next venture which was Falcon Software.
Jon Voigt: So starting Falcon software from building this database, from building this software application?
Gary Eisenstein: Yeah. Well the writing was on the wall. I saw that that was the future. And this is still this is before internet. But I saw the future in computer technology and delivering this electronic master catalog out instead of just a very readable local customer. Now you know the world was my customer right. You know we did have a focus in North America but we were making sales into Europe as well. So you know I took that database concept and we labeled it cable smart as a catchy name and sold it on floppy disks for $89 U.S. which was updated annually and so the companies we have clients such as AT&T and NASA and U.S. and Canadian forces you know any organization in fact that regularly purchased large volumes of wire and cable. Those were our customers. Although the wire company was doing well I just saw this as a huge opportunity I had to take the chance and did make a good sale of the company in 93. So you know I had some breathing room to carry on to my next my next adventure for sure.
Jon Voigt: And was it the next adventure that kind of pulled you through to sell that. You know obviously you have a business that's running along nicely. It's doing well there's demand for it and you're kind of taking a risk right.
Jon Voigt: You're jumping into something new the next kind of generation of software direction type things with that technology. What made you feel that was the right time? What made you get over that hump of freight that oh this is already working well now I'm leaving it?
Gary Eisenstein: Yeah. That's a good question as well. I think you know I wasn't married at the time. No I don't have any kids. I also walked down with a mortgage.
Gary Eisenstein: So taking risks were such a daunting endeavor that for example it would be today.
Gary Eisenstein: I would not touch it.
Gary Eisenstein: The company was making money. Just before I sold the company I was awarded the entrepreneur of the year from the B.C. Premier. And that's you know things were looking up for the company. So yeah from an outside looking it's like what's going on here. But I think it's just now that that entrepreneurial spirit that being in a situation where I could take a risk without too much damage if it failed appealed to me. You know I wasn't born with West Coast wire but I think it's just the timing was right and I was ready to take it take a chance.
Jon Voigt: Did you drive that chance? Did you go looking for someone to buy it? Did someone come to you? What triggered that?
Gary Eisenstein: Well one of my customers they were cabling. They made harnesses for all different electronic applications. They became really good friends because they'd bought off from me almost daily. And when I told them my ideas and what I wanted to do it was the guys there that suggested "Hey if you're looking to sell West Coast wire, we're a buyer."
Jon Voigt: Music to the ears.
Gary Eisenstein: Yeah I think that helps in making my decision for sure so I didn't have to go out and find a buyer or that whole process. I kind of avoided that. So it helped in the final decision as well having a ready made order at my thumb.
Jon Voigt: So you kind of you saw the writing on the wall going from home installation to installing and selling specific cable and then you know 100 percent just to cable and then into a business that you know selling it almost like a directory of all sorts of cables so it's really changed over time with what the market was looking for, what the technology was allowing you to do. How how did that continue in Falcon? How did that start out because you had the one product initially but that kind of was sold? Where did you go from there?
Gary Eisenstein: It was really a thousand software started off as a one SKU software company. And to be perfectly honest I had no business being in it. And the head of a software company I barely knew how to turn on my own computer at the time. But I made sure to hire some bright people that could you know turn the engine over the. But you know that was a concern in the beginning that we are one SKU company. So my ideas at the time was to keep promoting and pushing and selling the cable smart software and hopefully something will come around the horizon and we'll be able to get out of the one SKU issue and and have many different products or services to offer. We weren't looking at services at the time we were strictly a product based company. But I think the lucky break. What happened, it wasn't long before one of the largest cabling distributors in the US called Hughes Wire and Cable called us up and they had copies of the software that they had bought for eighty nine dollars US and they really liked it and wanted to distribute to their customers.
Gary Eisenstein: And we thought great. They'll place an order for 100 maybe 200 software packs and we get some much needed cash used into the bank account. But how do you imagine our faces when they sent us a purchase order for two thousand packs. That really help you know every time. So you know that went on for a few years until one day we got another call from a New York based wire and cable manufacturer that asked us if we could build them a catalog on this just like cable smart but would only their particular products loaded in. And we said sure why not. What we had done was something very noble at that time. We built catalogs that wasn't even the term back then we didn't know what we're doing. We're just putting products on a desk. And for them they could hand this out to the customers and save time and cost on producing standard paper catalogs and their catalogs are really thick. So this was an attractive option for them as long as their customers could utilize that technology.
Jon Voigt: That's amazing.
Jon Voigt: So you went from a single SKU into kind of specialized similar products but specialized version of the product specific for customers?
Gary Eisenstein: Yeah. Well the next thing you know another company called us up and I think they looked at what that New York manufacturer had found out we did it now asks the same deal. Then another one and a few more after that. Next thing you know we have become the go to catalog developer for all the top wire and cable manufacturers in North America. So yeah we went from a one SKU company to more of a service based business model. And providing electronic catalogs for a very specific industry the wire and cable industry. That was one hundred percent of our clients were made up within that sector. But the revenue stream was so good from doing customized software catalogs we stopped producing cable smart because cable smart very intensive.
Gary Eisenstein: Think of the focus on just one manufacturer so simple compared to the focus of say 50 to 60.
Jon Voigt: Updating the database, keeping everything up to date.
Gary Eisenstein: Very labor intensive. So we switched from the product based company to a service based firm and never looked back.
Jon Voigt: So is that the costs that pushed you this direction or was it the revenue or both or all of the above all?
Gary Eisenstein: Our revenue just seemed to you know it was kind of like that roller coaster. You get an injection of cash and you go through that cash injection of cash go through that cash. We're turning to more of a service based building e-catalogues for various amounts of clients.
Gary Eisenstein: We had a steady growth. And I certainly enjoyed a steady growth than the roller coaster business model for sure.
Jon Voigt: And so where did it go from there? Because you know I'm not sure. Do you still do catalogs now? I don't think you do so.
Gary Eisenstein: No we don't do any software now.
Gary Eisenstein: It's funny how you know that one day seems to always come up at Falcon Software. But the same manufacturer, the New York manufacturer called me up and said Gary you build us a web site so we can have our products online. Sure I'll get back to you on a price. As soon as I hung up the phone, panic set in. I had no idea how to build a web site. I didn't have one for Falcon's software at that time. So fortunately for me my partner at the time you know he had a history of web site development so he knew what he was doing there. So you know it become, after that web site kind of repeated itself. You find, you do one then the competitors look at what you're doing, you do another one, next thing you know we're web site design company. Back then most web sites were just line card web sites, they have telephone number, maybe a line part of your products or services and that was it.
Jon Voigt: Yeah. People put them up because it was something new that was coming but it really wasn't functional initially.
Gary Eisenstein: Yeah. Most web sites were not functional whatsoever back in 93-94. Still all company didn't even have a web site. So what we were doing with this New York company, everyone was paying heavy attention because they hadn't seen we can actually put products online and have a little forums for them to get a quote from them. You know e-commerce still was nowhere near in the playing field at this point.
Jon Voigt: No shopping carts.
Gary Eisenstein: People started to pay attention on what we did and the forum ran off the hook from company saying yes let's do a web site just like you did for that New York company and that whole "me too" syndrome did as well back in 94, 95, 96 for sure.
Jon Voigt: So I see a trend here, the kind of "me too" concepts. A lot of the things that I've kind of allowed you to adapt to the customer demand has been you new customers coming in saying I would like to do this too and sometimes I feel we do work for somebody and nobody else in the industry hears about it. So how did these other people hear about it and how did they learn that you guys were experts on this stuff?
Gary Eisenstein: Well it was by design that we stay within one sector which was the wiring cable industry. So we went all out to all the trade show. My role was with you know I was everyone knew me. Everyone knew our company. So it wasn't that hard to infiltrate that particular sector and really took advantage of it. No one else was touching that sector. So it was like really shooting fish in a pond for us. It was really something easy. But we knew that at some point that sector is going to dry up on us so we you know the biggest fear for us was was not being able to leap out of that sector. So that was on top of the agenda for a few years after it was getting out of that industry only to be hamstrung in and would probably be the death of us if we didn't get out.
Jon Voigt: That's kind of cool you kind of been pushed along but pulled along at the same time. And so where are you now? Like where's the business now in terms of what you're working on? Obviously the cable stuff is long in the past and the distribution of C.D. and stuff like that.
Gary Eisenstein: Yeah. It's almost sad. I think we only have maybe one or two cable clients left because that industry is in a major decline and you know you got to go where the money goes. It's not an attractive sector for us.
Gary Eisenstein: It's still our humble beginnings. But you know 25 years later you know I think we've gone through many. Always making sure we keep up with the latest analogy. That's the game right now. Innovation such as e-commerce and web US deployments over the last decade that's where we really have been hanging our half. But today it's all about the online customer experience, the journey as it were. I'm a lot less really to take the risks these days like I was decades ago but fortunately for us the IQ world always seems to provide new opportunities for us to capitalize on such as the internet of things or artificial intelligence or business applications for virtual reality. You know our future is pretty good. As long as we do two things, we keep up with the newest and latest technologies but probably the number one factor for our business in the future is making sure to really listen to our customers. I got to tell you where you want to go. And the nice thing about a customer is they're generally bringing things that they'll cut appeal for they're not trying to force a technology they don't understand and they're not going to pay for us to do. They're going to come to us if we're listening and we're able to deliver they're going to come to us with actionable work.
Jon Voigt: Right. So that's it.
Gary Eisenstein: And we're keeping up with all the latest technologies then the future looks pretty good.
Jon Voigt: Yeah. And that's a trend. I think all through all your stages was you know really listening to the customer and maybe maybe it's not just the ability to adapt but your ability to listen to the customer and the demand of the industry that you're in has allowed you to adjust and pivot as those needs have arised. And you know it's not even this magical foresight and what's next it's as simple as listening to the to the customer and what is coming next and what do they need.
Gary Eisenstein: Yes, I think it's a reactionary to the clients need has always served as well for 25 here so I don't think I'm going to be changing that anytime soon.
Jon Voigt: So tell me a little bit about CMSC media and because really I kind of look at you guys deep divers into what's going on in the industry and it's the same thing we're kind of talking about here is how are you listening to the the pulse on the industry.
Gary Eisenstein: CMSC Media, that's a funny one I didn't see that one coming. You know my latest venture was born out of a simple blog site. It started in 2011 called Seamless Fight Club. But the intent was just to catch people's attention and drive traffic back to thousand software, the blog site. Basically what we did was we posted a bake off between web content management platforms such as a site core versus Drupal or to overseas site liberty. We list off the platform features and benefits side by side. Let the audience decide the winner through an online poll. The original plan was to generate no relevant traffic and lead them back to Falcon services page. That was our agenda and it worked well for us. We knew it was going to eventually run its course. Why do so many bake offs. So I decide to add monthly webinar commentary and different features where we have posts and guest speakers talk about different CMS platforms and the poll results and stuff like that. And funny thing happened the traffic exploded. So we had to kind of step back and really think of this a little more professionally and then just you know bulk in putting on a blog site. So we separated the company from CMS, I'm sorry separate out CMSC media from Falcon software and we kind of lost that scene as Fight Club thing and added in monthly podcast.
Gary Eisenstein: And you know industry news updates and we also add your story but we're still doing it at the time or just doing that monthly. The traffic though it seemed to be quickly shaping up as a destination for people in the IT industry to get their news. But we were getting a lot of feedback saying can you put out more. They didn't want to leave us post once a month. They wanted this kind of news on a daily kind of stream so we changed our format from a monthly blog site to a daily industry news portal site and that's what we've really been growing over the last five years and we've seen traffic numbers grow now. Each and every month is a record month for us. As far as audience and traffic numbers so today there's thousands of people that come to the site each and every day to consume content such as the news and podcasts with case studies and video articles and company product reviews and all that sort of stuff. And we also have tech reporters that go to events world wide now and conduct video interviews and catch the show vibe and bring that back to our news portal.
Jon Voigt: Right. And how how much does the direction funneled back to Falcon and change the pivot Falcon? Is that happening? Are you seeing new trends and new things that now Falcon can jump on and take advantage of?
Gary Eisenstein: No not as I would have thought. To be honest with you really the company's totally have separate out from each other. You know CMSC media and Falcon are kind of, we're in the same sectors but we're each doing their own thing very little crossover. I think you know when we say get introduced to a new vendor platform I think they know more about CMSC media than they do Falcon Software. So it certainly helps people get that door open and have them have a discussion with you because they know you from that news portal not necessarily as the software company. So it's become helpful in that way. But today there's really no financial strain between the two.
Jon Voigt: And I guess you know you've been able to pivot along this whole way with kind of the guidance of customers bringing new insights into their industries you know is there any other tips or tricks do you think that you could give the audience that you know at the end of the day you know not only did you hear what the customers wanted to go and where they were going but you were also able to pivot very quickly.
Jon Voigt: Why was that maybe or what could they do to be able to listen to their customers more closely?
Gary Eisenstein: Well yeah, it was it's always been second nature. And I think that the entrepreneurial type of person I am.
Gary Eisenstein: And so just a little bit of luck and a lot of hard work with the last 25 years. And it seems like it just unfolded very nice for me. I spent a lot of bumps in the road. A lot of lessons learned on the way but I think yeah if I would dispense any advice whatsoever it's listening to the customer. Really being tuned with their need. Talk less and listen more, you can't go wrong there.
Gary Eisenstein: Yeah that works for marriage advice too.
Jon Voigt: It's all the same. Yeah. I've got to get in the next stage.
Gary Eisenstein: You know we're now just taking that next stage again with CMSC media. We are listening to the customers and what we found out is that not only in our industry but industry wide almost every company produces press releases, blog posts, case studies, webinars, white papers such as the one I'm on today but they don't know what to do with all this. They create all this content. They have no idea what to do with it. How to make it as a return on investment. And so we thought wow, we've built a great channel a great news portal with thousands of thousands of daily visitors. Could we create a cohesive type of service that allows our customers to take advantage of that portal? That's what we did. We came up with what we've coined content journey as a service. So now you know we we were connecting with the I.T. agencies and integration firms and software vendors and gathering their content and kind of laying out in a journey with a destination in mind. That destination of course is the final acquiring qualified leads. So you know we take like I mentioned all the content that we create and we deployed on our channels in a very strategic journey type manner with planned destination. And that's where we are today. And we're finding that the customers that are jumping on board on this are having great success with what is typically very difficult because creative content is very expensive for companies. You need staff to produce this content. And then once you produce the content you've got to find out and get eyeballs to it. If you just post this on your site and get a few hits, you posted on our news portal you get hundreds and hundreds of people writing consuming that content and that's the key without CMSC media, we're just another marketing agency.
Jon Voigt: Yeah for sure. Well I love what you're doing with all this and I love the idea but the journey of the customer and listening to the customer more I think it's huge.
Jon Voigt: And obviously an easy way to keep on top of things and and adjust and be ready for what's going on just to hear from people that are in the middle of it and hear where they're going and where the future lies right from the customer. So this is really awesome stuff. You know if someone wanted to learn more about Falcon or CMSC Media, how would they find you? Where would they go?
Gary Eisenstein: Well there are two websites, one for Falcon software is simply falcon-software.com and our CMSC Media portal is CMSCMedia.com.
Jon Voigt: Ok awesome. And we'll probably linked to your LinkedIn or something as well with the podcast. But Gary this has been awesome. It's been such a journey for you going from so many different businesses through everything.
Jon Voigt: But I definitely see the common trend of listening to your customers and being able to adapt and change over the years is what's kept you a really valuabl