The Exchanges

Q Now, what is your story in terms of the founding team at FunctionFox? Were you one of the founders, or were you brought in afterwards?

A Uh, brought in before it even was an idea. So CEO founder is Mary Lynn, and she's still around today. There's four of us. We all started 20 years ago, and we built it for ourselves. She had a Suburbia Studios, which is an ad agency, and thought, you know, we really need something to track our time, manage our projects. Uh, and there wasn't really anything in the market, and so we built it for ourselves and thought, hey, this is actually pretty cool. Put it out to a few other people, and they said, yeah, this is really great. And so we built it into a business. It was not, uh, on the onset to go, Hey, let's build a big business. It was build it for yourselves, which is always, I think the best. And, uh, 21 years later, we're still selling globally. So.

AI assessment note: “brought in before it even was an idea. So CEO founder is Mary Lynn”

Q What happened? Where did it go from an internal project where you're eating your own dog food to customers, to new people going, wait, what is that thing you just used? I want to use that time tracking too. And you actually spin it out on a separate cap table and launch it.

A Yeah. So how it worked was we were looking for ourselves. We did lots of research. We called around. We really couldn't find anything. There was clients and profits at the time, um, you know, was installed, really expensive, and so we called about 300 agencies in the U.S. and said, hey, what are you using? And people are like, oh, Excel, pen and paper, and we're like, there's, there's a need here, um, you know, and it's working for us, and so we shared it with a few of our local agencies, and they're like, this is really cool. We would use it. So we're like, okay, do you guys want to try it? And beta tested it. Um, and then we thought, you know what, there's something we've got here. So we did a launch sort of locally and, and said, Hey, anyone interested, come and see. We had a huge turnout. Um, and from there we thought, okay, let's build a website and they'll come. I mean that we thought no demo, no trial. We'll just launch a website and they'll all come and buy. And no, that wasn't the case at all. Um, so yeah, we, we built a demo and, um, slowly started to put it out to people that we knew and got them to beta test and, um, Give us feedback and built in sort of feature by feature as people needed things and requested them and we've built, you know, onto that ever since. So officially launching it was about a year later where we said, okay, let's actually build a team and b…

AI assessment note: “we shared it with a few of our local agencies, and they're like, this is really cool”

Q Yeah, no, this is great. Um, and any news, it's always interesting to think about like small versus large. I just think about it like happiness or not, right? There's plenty of people with a five million dollar company with a million in profits per year, and they're super happy and they don't want to be big. Uh, you guys seem like you're really enjoying what you're doing.

A Yeah, we love it. I mean, I love coming to work every day. The whole team does, right? I think it speaks volumes in terms of the tenure of the staff. We've even had, you know, people leave the company over the years, and we've had 10 or 11 employees ask for their job back, so that, you know, always rings true to me that there's, we're doing something right, and we're not pushed by big investors that are looking for, you know, this or that. We kind of say, this is what we want for our customers, and this is what we want for our staff, and it If it's works for the company and it works for our team and it works for the individuals, it's a yes from us.

AI assessment note: “Yeah, we love it. I mean, I love coming to work every day.”

Q Four. And, um, we haven't talked about function in Fox pricing, but is the pricing large enough where it makes sense to have an internal sales organization or do you not have sales quota carrying reps?

A Yep, so we have a sales team. We have a service team. Marketing is one, and then the dev teams of our engineers, and they do cross-platform, so like QA and development and SEO and that sort of stuff as well, and so we have an internal sales team, and yeah, it does make sense. In terms of pricing, we have a free product, so there's a lot of users there, and then it starts at 35. Well, we have a light product for 20 bucks a month, Uh, that's just for one user freelancers sort of gig economy. And then we've got, uh, a classic premier and in-house and they start at, you know, 35 dollars plus five dollars for each additional user and then, uh, 50 dollars. So it's, it's really priced affordably and really can grow with, you know, users can grow with the system.

AI assessment note: “we have an internal sales team, and yeah, it does make sense.”

Q How much did you bring in in that first year from friends and family and all that to really like kick this thing off? I mean, are we talking like a hundred grand or like a million?

A No, not even. So it was a half a 1,500,000 from friends and family. One was a big chunk from sort of one investor that was really a family friend and we haven't raised money since. So for years we've really, you know, Based on our own profits. We're a very profitable company. We're very different than a lot of other companies out there, you know, thirty five million or they're in their third round or whatever it may be. We've never done that. We've just kind of said, okay, this is where our growth is going to be this year. We're profitable. We want to have this as a lifestyle business. And if we need more injection of cash, we raise revenue in a different way. So we'll put out, you know, price increase or we'll do a feature or an add on or do upgrades, that kind of thing. And then we'll build naturally and organically. And that's worked very well for us and very different than a lot of other players in the market.

AI assessment note: “it was a half a 1,500,000 from friends and family.”

Q but they don't know where to start. They don't know if they should give their, their current employer a part equity. If they spin it out, they don't know if the employer actually owns part of the tech because of their employee contract. They don't know how to necessarily fund it per se. How did you work through all these things as you guys spun FunctionFox out of the agency?

A Yeah, we didn't know ourselves, right? It was just kind of trial by fire and we like built, we didn't know about really a cap table and how to build it. We, we went out to friends and family. We have more shareholders than we'd wish to admit. Um, and so we spun it out and kind of said, okay, well, if it's working for us and we built all of the tools that we need. So at the time there wasn't like the Salesforce or the HubSpot, we built all that stuff internally. So today to run our business, we use nothing but our own internal tools. So not just FunctionFox, but we have our own SMS system, sales management system, CRM system. We do all of our own billing and tracking and anything that we need for our system we've built, and so there's the 20 other products that we probably, maybe even more, that we actually could sell, um, and it's just a matter of staying focused. So yes, we could do all those other things, but we said, you know what, this is the bread and butter, this is what we believe in, and this is what's, you know, making an impact in other people's lives, so that's what we've stayed true to.

AI assessment note: “we didn't know about really a cap table... We went out to friends and family.”