Before HubSpot and the famous OnStartups blog, Dharmesh Shah worked as a developer for SunGard, a leading software and technology services company working with financial institutions.
One day at work, Dharmesh had the idea to create a data conversion tool to allow financial institutions to transfer customers from one institution to another.
Dharmesh brought his idea to the attention of his manager who immediately saw an opportunity for SunGard. Curious, he asked Dharmesh how much he thought the software could be sold for.
Dharmesh, having no idea how software was priced, quickly answered, “$5,000.”
It was an interesting opportunity, but the manager felt that SunGard would never invest in deals of this size; their customers typically signed multi-million dollar deals.
Dharmesh could not get the idea off his mind, but he also understood that SunGard could not pursue the opportunity. After much deliberating, he decided to leave SunGard to start his own business, Pyramid Digital Solutions.
Having left on very good terms and not particularly skilled at selling software, Dharmesh soon came back to SunGard with a distribution deal: SunGard would sell the software and, in return, they would receive 50% of revenues.
Although the revenues were not that interesting to the large software services company, they saw the potential of being able to transfer customers from competitors.
SunGard agreed to distribute the solution. Had they not known Dharmesh, they would have never agreed to this kind of deal.
For the first two or three years of the company, SunGard was Pyramid Digital Solutions’ exclusive sales channel.
In the fourth year, the company started getting more distribution partners and really took off. SunGard, realizing the extent of Dharmesh’s success, started bidding to acquire the growing software company.
It took a few years before Dharmesh agreed to sell the company, but when he did, Pyramid Digital Solutions was making over $15M in sales each year.
Ultimately, Dharmesh started with the functional and industry expertise he had acquired at SunGard. His ex- employer inspired the opportunity, sold the software for him and, when he became successful, acquired the business.
The entrepreneur turned a full-time job into a great business opportunity.
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