Jenn Steele has a killer sense of humor. She jokes that she arrived at Kissmetrics, a behavioral marketing and analytics platform, as the “nth-CEO” where “n was a large number.”
True, Kissmetrics was on its third round of investors and as many CEOs. Despite an incredible product – “the most stable product” Jenn had ever worked on – morale was low.
How, then, did she steer the business towards a seven-figure exit on Acquire.com?
“Andrew talked me off the ledge a few times,” Jenn said, referring to the support she received from the Managed by Acquire program (now Guided by Acquire).
Kissmetrics was, in some ways, a difficult sell. “The AWS fees are pretty big. It’s basically Google Analytics but with more actionable insights. That doesn’t come cheap.”
Profits were slim despite steady revenue. Jenn needed another round of investment to grow the business, but the investors were fatigued and ready to sell.
After failing to woo strategic acquirers, Jenn and the team turned to Acquire.com. There she found a Kissmetrics user with a new application in mind for its clickstream data tools.
Learn how Jenn managed demanding buyers and a complex product and why that sense of humor in the face of adversity continues to serve her well.
Biologist Burns Out
Jenn graduated from MIT with a degree in biology, but the dotcom boom lured her to information technology. She ran IT departments at law firms where the people she managed were much older than her. “Your best day was when no one noticed you,” she said, referring to the general attitude of non-IT people to those maintaining the technology. If it worked, you were invisible.
Later, Jenn earned an MBA with a concentration in leadership. The IT role had lost some of its shine, and balancing studies with work eventually burnt her out. Jenn longed to do something new.
“I called up my career services office from business school and said, ‘Look, I’m burnt out. I’m done with legal. I might be done with information technology. But I’ve been really getting into social media and blogging. The careers officer said, ‘Oh my gosh, you must talk to this company. Nobody knows much about it yet, but you’ll love it. It’s called HubSpot.’”
Jenn became employee number ~90 at HubSpot in 2009. She’d blogged, been active on social media, and run law firm websites, so she understood the value of content marketing. HubSpot later trained Jenn to become an inbound marketing expert.
“What do you do with a technology executive at Hubspot? You make them an inbound marketing consultant where they teach marketers how to do inbound marketing and implement HubSpot. I knew so much about that, clearly,” she said, laughing. “Luckily HubSpot has a great training program, so I seemed a little less stupid as time wore on and I rose through the ranks.”
Never one to shy away from a fresh challenge (or maybe just a glutton for punishment), Jenn left HubSpot for Amazon.
Role Play
Jenn joined Amazon as a product marketer for Amazon Simple Email Service. Later, she became responsible for all of Amazon’s retail revenues from Bing across free and paid search, giving herself the moniker of the “Bing Chick”.
“I branded myself as this Bing expert who could talk the category marketing managers into experimenting on Bing as well as Google. I’d say things like, ‘I’ll teach you how to experiment on Google if you also do it on Bing.”
But Jenn missed the startup life. She eventually left Amazon in 2013 to join a recruitment startup that struggled. She then bounced around various roles and startups. One year she was VP of Product Marketing at Bizible (acquired by Marketo while she was there), another CMO at Madison Logic, and then CRO at ORSNN, a Seattle fintech company. Each role inducted her into new business areas, gradually building her experience.
“I was on the customer success team at HubSpot, various teams at Amazon, head of growth at RecruitLoop, and product marketing at various startups. Then CMO and CRO. I got the full go-to-market experience,” Jenn said.
Then one day, while Jenn was still at Reprise, her paid-search consultant asked if she’d be interested in a CEO position. “I said, ‘Are you kidding? It’s a CEO opportunity!’”
Kissmetrics wanted someone with deep go-to-market experience. Jenn had that plus technology and P&L experience. Suddenly her meandering career path made sense: she’d been a CEO in training.
“Most CMO roles only last around eighteen months anyway,” Jenn added. “We usually move on once a better opportunity comes our way.”
Bing Chick Becomes CEO
Whatever you do in marketing, you seldom, if at all, see results quickly. Moving roles or companies can mean leaving before your efforts truly pay off, which can be demotivating.
“The biggest challenge with switching roles time after time is that you end up leaving just as you’re starting to get traction in the market,” she said. “Sometimes you buy equity in the company, so you can see your efforts pay off that way, but it wasn’t until I got to Kissmetrics and was able to position the business for exit that I finally started getting job satisfaction.”
Kissmetrics hadn’t had a CEO in the six months before Jenn took the position. It was on its third set of investors, and Jenn was that set’s third CEO, despite the company having a “phenomenal brand and product”. The frequent changes in leadership resulted in some strange decisions.
One was the sale of the Kissmetrics dotcom domain to Neil Patel. Kissmetrics lost over a million monthly visitors and had to rebuild the company’s audience using the less popular .io domain. Jenn initially didn’t even have access to the company’s social accounts since they were tied to Kissmetrics.com, which now belonged to (and directed to) Neil’s website.
“I don’t think all of the previous CEOs cared much about brand and go-to-market,” Jenn said.
The sale of the domain wasn’t the only problem. The company also hadn’t onboarded a new customer in six months. The team was demoralized and the sales team had walked. There was no go-to-market process, sales pipeline, or marketing. The company was more or less in maintenance mode.
Jenn said: “I had to ask myself, ‘How do we become a company again after six months of everybody treading water and the team becoming demoralized?’”
Gradually, Jenn got the motor running again. She infused energy into the team standups and hired a new sales rep. The engineering team, which had built an incredibly stable product but couldn’t decide what to do next, now worked on a product roadmap Jenn helped draft.
But delivering results was slow. Enterprise revenue pushed the numbers higher, but large clients were harder to win (with years-long sales cycles) and replace when lost.
The investors had noticed the green shoots Jenn had planted and discussed investing another round in growth. But the economic conditions were poor, and it would’ve been a long journey to scale the business. An acquisition seemed like the best way to achieve the investors’ goals.
“I set the business up for success, but growth doesn’t happen overnight. It would’ve taken a year or more to double or triple revenue because we started so far back,” Jenn said. “I was these investors’ third CEO and the appetite to grind that out was low.”
Data Don’t Come Cheap
When you decide to sell a business, you can attract one of two buyer types: financial or strategic. Jenn targeted the latter. Kissmetrics was breaking even, investing as much as it could into sales and marketing, and the lack of a juicy EBITDA to attract private equity left few other options.
But even strategic buyers, other software companies who might have used Kissmetrics’ product, didn’t have the resources to integrate it – and neither did Jenn’s team.
“We shopped the business around to software companies that we thought would benefit from our product. We ran a skeleton crew so couldn’t do a full-scale integration. Neither could the companies we spoke to since they were also running ultra-lean teams,” Jenn said.
Many software companies also balked at the cost of operating a clickstream data business.
“Clickstream data is scary for people because it requires a ton of AWS resources to process,” Jenn said. “Companies would pale when they saw the bill. I’d say, ‘It used to be triple that – aren’t our engineers amazing?’ Anytime you have a company dealing in big data, you’ll have a big cloud bill. But not everybody expected that.”
Kissmetrics occupied awkward ground. Too small for growth equity, not profitable enough for private equity, and too difficult to integrate for most strategic acquirers.
Where would they find a buyer?
Exit This Way
Kissmetrics’ chair had tried selling the business on Acquire.com before Jenn joined. There was no CEO at the time, so no one to manage the process, and the business didn’t sell.
With Jenn at the helm, the chair transferred the Acquire.com account to her, saying, “Let’s give MicroAcquire [now Acquire.com] a shot.”
Managed by Acquire had just launched and Jenn thought the extra marketing and acquisition support would help Kissmetrics maximize its exit.
“Andrew sent me a presentation with about 150 questions and I could easily answer about ninety-nine percent of them,” Jenn said. “I connected our metrics and did everything Andrew recommended.”
Kissmetrics published a revised listing on April 6th, 2023. The company received around 40 inquiries, and just 8 days later, received its first letter of intent (LOI).
“I’d just moved to a new apartment the day before,” Jenn said. “I was supposed to be unpacking boxes and I got an LOI at eight o’clock in the morning. I shouted to my husband, ‘Sorry, honey, I can’t help unwrap the crystal.’ Instead, I had to scrutinize this offer.”
Closing Weeks
The Kissmetrics buyer was a 3D creation marketplace for building augmented and virtual reality assets. The buyer wanted to be among the first to track clickstream data in 3D environments.
The buyer was so excited by what Kissmetrics could do, it wanted to close the acquisition seven business days after signing the LOI.
Were Jenn and her team ready to move at such a rapid clip?
“My investors wanted as much cash as possible, and if we’d waited, we might’ve been able to negotiate for more. But the buyer was pulling all-nighters to get the deal done. They used the Acquire.com preferred lender [Boopos] and everything. They worked so hard to get everything together so they could close quickly, and no one else was even close.”
Around six other buyers had asked Jenn to let them know if the deal fell through. But those remarks didn’t come with attached promises, which convinced Jenn that Kissmetrics probably wouldn’t get a better offer. She recommended the investors take it.
Now all Jenn had to do was ensure the deal closed. She didn’t have an executive team to help her, just the CTO and head of sales. Together, they did all the work, answered all the due diligence questions, and prepared all the documentation, with Andrew’s guidance. On May 4th, 2023, the deal closed.
“It’s one thing being on an executive team during an acquisition and another being responsible for everything,” Jenn said. “In the end, we agreed to do a stock purchase acquisition, which made closing easier since there were no bumps with transfering over the credit card billing or accounts. We could keep everything running and just hand everything over.”
Jenn would also provide transition services for 30 days after the deal closed.
“I signed a contract agreeing to stay on for thirty days post-closing. It was pretty easy. I mostly answered buyer questions over Slack.”
Slack Attack
Jenn has few regrets about the acquisition process. With Andrew’s help, Kissmetrics found a buyer committed to getting the deal done. Closing a seven-figure acquisition in fewer than 30 days from an LOI is an impressive feat. Her only gripe was how much energy it required.
Amazon, HubSpot, and executive positions at early-stage startups had accustomed Jenn to demanding roles. She’s weirdly comfortable outside of her comfort zone. But the acquisition was something else. She wishes she’d set firmer boundaries with the acquisition’s stakeholders.
“I wish I’d have cut back on Slack and text messages, to be honest,” Jenn said. “I wanted things to go well, so I was hyper-responsive. My lawyer always had another detail to confirm. The acquirer never ran out of questions. And I was feeling a bit overwhelmed.”
Late one evening, attempting to switch off at a Drew Bledsoe wine dinner with her husband, Jenn was constantly interrupted because someone on the acquisition team wanted to vent. “I wanted to say, ‘Hey, I’m at dinner, so unless it’s an emergency, call me in the morning.’ But it felt risky to shut down people I might later rely on to help close the deal.”
The closing date also changed multiple times. “The acquirer would ask for another slew of documents and give us little time to prepare them because they were under such tight deadlines.”
Just when Jenn was ready to explode with frustration, Andrew would step in and help calm her down. He’d been through several exits, knew the dog and pony show that was acquisitions, and advised Jenn to think just as much of her own wellbeing as the company’s objectives.
“Andrew even told me to stop Slacking so much so that I could preserve my sanity,” Jenn said. “He was incredibly supportive, always ready to hop on a call. This acquisition had quite a few bumps, including one where our lawyers didn’t really want to talk to each other, so I had to handle a lot more than a CEO normally does. But Andrew was always there to help, which was incredible.”
World Building
Turnaround businesses like Kissmetrics are an enormous challenge. Just helping them break even can require all of a leader’s time, energy, and resources. Jenn managed to reinvigorate Kissmetrics and sell it for a seven-figure sum, which is beyond impressive, but she recommends setting boundaries with anyone who wants a piece of your time to avoid burning out.
“Draw and keep your boundaries,” Jenn said. “I treated the acquisition like a sales process to a fault, responding to everything, instantly. But selling a product is so much different than selling a company. It’s hard to switch off when the stakes are so high. But you need to know when to pull back and give yourself a break. Otherwise you end up with no gas in the tank and scrambling for help when something serious happens.”
Jenn’s acquisition scars are healing nicely. The investors were pleased with the deal and want to be involved in her next project. Turnaround CEOs are in high demand. Having turned one floundering business around already, Jenn can recognize more of what’s going wrong and why.
The acquisition has also changed Jenn’s views on entrepreneurship. An IPO is no longer the ultimate opportunity. She would prefer to scale to “x” million and sell for “y” million. Yes, the stakes are high, and it’s seldom easy, but as Jenn says, “The world won’t end if the deal doesn’t go through. And it won’t end if it does.”
Founders take note.
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