When I stepped into the role of CEO at Drobo, I underestimated what it would take to revive and grow Drobo’s profitability. Facing many of the common challenges in the hardware space, I would like to share our story.
In 2005, Drobo began as a classic Silicon Valley startup, supported through venture capital. The company grew rapidly over the next several years, and nearly approached $50M in revenue! However, even with the growth in revenue, Drobo still did not achieve profitability.
Today, Drobo is a smaller company in terms of revenue, and is expected to be profitable by Q4 of this year.
The process of reviving Drobo has been a rollercoaster ride. We have encountered many ups and downs, and along the the way I’ve learned (and learning) what will help Drobo achieve it’s goals. I call my journey, the 5 C’s of turning around a hardware startup business.
#1 Customer Connections
Personally connect with your customers. This means getting to know your customer base, since they are choosing and purchasing your product.
I have made it a goal to call and talk to 500 customers a year to find out why they chose Drobo, how it’s performing, and how we can improve. This year, I traveled over 100K miles to visit our customers from all over the world and discover their experience with Drobo.
#2 Cash is King
The hardware businesses is cash intensive. Having access to capital is important for the growth of the company. We have been fortunate to have a supportive investor, who has been patient during our turnaround process.
#3 Culture Club
Establishing a strong culture is critical. Due to the changes a company will undergo in a transformation, engaging your team members is important during the process.
Creating values with your team is beneficial for achieving goals and providing support towards one another. Our values reflect how we treat one another, how we respond to customers and how we make decisions.
#4 Contract Manufacturers
You want to have a partner who believes in you, your company, and its vision. Do your due diligence. You want a partner that will stick with you when times get tough.
#5 Communication
Communication is key! Make sure you are effectively communicating with your team, investors, vendors, press, and of course, your customers.
Being transparent is at the core of communication. At Drobo, we implemented Transparent Tuesdays, where we spend 30 minutes discussing business results, goals, and appreciating our team members.
Conclusions
I hope this has been helpful for your journey. I plan to dive deeper into each of the 5 C’s within the next couple of months. Feel free to reach out to me with any questions.
Mihir Shah became CEO of Drobo in 2015. Drobo develops and manufactures award-winning data storage solutions for small businesses, creative professionals and prosumers.
Twitter: @DroboCEO
Facebook: Mihir H. Shah
6 years ago