For Bootstrappers

Case Studies

Case Study:  Scaling a Healthcare

Technology Company

When PlayMaker CRM (“Playmaker”) CEO Judy Bishop and her son, founder and President Adam Bishop, decided that they needed an outside partner to help them take their company to the next level, they chose Mainsail Partners. PlayMaker had been a founder-run, bootstrapped company that, while offering a tailor made CRM to its vertical market, had reached an inflection point. Mainsail and the Bishops came to a shared vision that to effectively scale the business would require a significant capital investment and an infusion of resources.

BACKGROUND

Adam Bishop founded PlayMaker CRM in 2008 based on the unmet needs of the home health and hospice businesses that he was advising on sales and marketing issues. He recruited Judy Bishop, a successful home health services executive, to be CEO of PlayMaker in 2011. PlayMaker CRM witnessed rapid growth, but Adam and Judy realized that scaling PlayMaker to $50 million of Annual Recurring Revenue (ARR) and beyond would require a trusted and experienced partner. The Bishops ultimately chose Mainsail Partners based on Mainsail’s experience scaling vertical SaaS and healthcare businesses that were also previously bootstrapped. Further, John Griscavage, an Executive-in-Residence (EIR) at Mainsail, was a strong fit for taking over the CEO function of the company, enabling Judy to retire to the board and Adam to run sales and marketing.

CHALLENGES

PlayMaker’s bootstrapping had come at the expense of investing in certain parts of the business (sales, marketing, account management, accounting infrastructure, technology systems, and management). While the company continued to grow, it began experiencing some headwinds as a result of the deferred investment in these key areas.  The Bishops had become fully aware of the challenges inherent in scaling a software company versus that of a home health services company.  They came to realize that additional capital and Mainsail’s help could enable PlayMaker to more effectively compete with better capitalized CRM providers.

VALUE CREATION

PlayMaker represents an ideal Mainsail investment in that it was  bootstrapped, growth-oriented company, and in need of complementary leadership, where Mainsail and its operations team could contribute to value creation. Mainsail and the management team implemented a value creation plan at closing, which has resulted in a real, immediate impact on the company as follows:

Sourcing CEO – John Griscavage’s domain expertise in the healthcare space is well established in that he previously ran two Mainsail healthcare companies, one of which is a company in PlayMaker’s vertical market, post-acute healthcare. Griscavage “voted with his feet,” and this transaction represents a successful execution of the Mainsail EIR program.

Hiring – In addition to the CEO, Mainsail supported Playmaker in recruiting a head of engineering, a head of customer success, and a director of finance.  Mainsail also helped the company in opening a Bay Area office to offer west coast sales and customer support coverage.

Sales and Marketing – Mainsail helped the company deploy its sales and marketing technology stack which includes Salesforce, HubSpot, InsightSquared and InsideSales.com. The company optimized its sales process, including building out an MDR team (Market Development Reps) and creating a tiered go-to-market approach around SMB and Enterprise market segments, while optimizing the sales team across geography and end-market verticals. Mainsail helped the company construct an analytics platform to better manage marketing investment and sales pipeline and implemented a streamlined onboarding, customer success and renewal program.

RESULTS

  • Partial liquidity was achieved by the founder, in addition to an infusion of primary capital to fund PlayMaker’s growth
  • Enhanced executive team with multiple key hires
  • Increased monthly recurring revenue (MRR) by 84% between September 2014 and February 2016
  • Increased monthly marketing qualified leads by 2.5x, and product demonstrations by 2x in 18 months*
  • Reduced the average sales cycle (# of days) for Enterprise product by 25%*
  • Quickly built scale, placing PlayMaker on a trajectory toward realizing its potential as a high margin, high dollar retention and low capital intensity business

Monthly Recurring Revenue Growth

 

MRRGraph5

*Performance metrics were calculated by comparing the six-month trailing average for the most recent six months available (9/15 – 2/16) to the same six month period in the prior year (9/14 – 2/15).  Mainsail invested in PlayMaker CRM in October of 2014.
 
**Timeframe represents 18 months:  Month 1 is the month prior to Mainsail’s investment (Sept 2014) and Month 18 is the most recent month of data available (Feb 2016) 
 
 
 
The portfolio company profiles and case studies provided on this website are intended as examples that clarify and typify Mainsail’s investment approach, not as an exhaustive catalogue of Mainsail investments. The companies were not selected based on the return on Mainsail’s investment in them. It should not be assumed that the specific investments identified and discussed herein were or will be profitable or that any portfolio company investments made in the future will equal the performance of the companies identified herein. No guarantee of investment performance is being provided and no inference to the contrary should be made. Past performance is not indicative of future results. For additional disclosures, please click here.