What it takes to be a Successful Entrepreneur: DukeGEN sits down with David Cummings of Hannon Hill

By Tom Powell ’09; Published November 16, 2009

David Cum
mings (BS, 02) is a true entrepreneur. Since high school he has been starting and growing businesses organically, with little to no outside funding. Today he is at the helm of three companies. While still at Duke, he founded Hannon Hill, an Inc. 500 company, to provide strategic web content management solutions and has since spun out two more companies: Pardot, a marketing automation software company, and Clickscape, a real estate technology solutions firm. On top of that, he is a partner at Shotput Ventures, a technology startup accelerator fund that focuses on capital-light web services companies and assists in the conception phase.

A technology and business expert, David’s articles have been published on O’Reilly’s XML.com and OnJava.com, in addition to popular web development sites such as SitePoint.com. He has presented at the Silicon Valley Web Guild, Silicon Networks, Atlanta Electronic Commerce Forum, and the Technology Association of Georgia. David has also lectured on startups and technology at Duke University, Emory University, and Kennesaw State University. With more than 14 years of software development experience, David is an experienced programmer and has written code for commercial applications in Ruby, Java, PHP, ASP, and Visual C++.David blogs at DavidCummings.org.

How did you get started in entrepreneurship?

I started my first official company -- one that was actually incorporated or registered with the state -- in high school in Florida. I would write shareware software that was free to use and customers would pay extra for the nag screen to go away or to get another module. One product I created was called Stat Book, which was designed to keep track of baseball and softball statistics for coaches. I had another product that was called The On Startup Series which was similar to those little flip books on your desk that show you a quote of the day, for example. This is back in the days of Windows 311 or Windows 95, back when you turned your computer off whenever you were done using it, so when the computer was turned back on, a little window would pop up and give you a famous quote of the day. That was my first product and the name of that company was called Mascon Enterprises – Mascon stands for mass concentration, which came from my 9th grade earth science vocabulary words.

After selling shareware the internet started taking off, so I started doing good old fashion web design in Florida. When I got to Duke I kept building websites for people, so I built the websites for a couple of the sororities on campus, professors, the Duke Computer science department, the social psychology department, one of the med school departments. However, after I built the website I would turn it over and back then there were no good tools to update a site. Blogging did not even exist and so literally 10 years ago it was very difficult to update a website. That’s when the proverbial light bulb went off to build a software company that provided tools for non-technical people to update their website.

I started working on the code for that product in late 2000 and officially incorporated Hannon Hill in my junior year,
January, 2001 to create pre-packaged software for people to update their website. We started out with small businesses and people on campus, it worked pretty well but there was no way we could make money off of it. Two years into it I licensed the software to a publicly traded company in Texas and used the royalties from that relationship to build a whole new contact managing system from the ground up geared toward the mid-market or higher in the market. It’s the same product that we sell today called Cascade server. It’s the software that the Duke website runs on. If you go to Duke’s homepage, that’s powered by our software. Right now our software powers about 125 different college and university websites.

Did you ever make a conscious decision to become an entrepreneur?

For years I had always had businesses but they were all just part-time things that I would do on the side. When I was in high school I also had a sports card collectables business that I would buy baseball cards off of eBay from different parts of the country for, say, the Florida Marlins and the Atlanta Braves -- teams that were relatively close to where I lived in Florida. If you buy an Atlanta Braves card from somebody in Seattle it’s not worth very much but then if you sell it to somebody in Atlanta it’s worth a whole bunch more. So I had always been doing business ideas like that and after building websites for several years, I realized that I didn’t want to be in a services business. I no longer wanted to be doing something that required me to actually do a bunch of work each time on each deal. That’s when I decided that I wanted to build a software product company as opposed to software services company.

So you had been working on that for a few years and then you started Pardot? How did that grow out of it?

About 6 years into Hannon Hill I realized there was a big need in the market for software to make it easy to help sales and marketing teams. Most of the tools out there like Constant Contact and iContact are geared toward the business to consumer (B2C) marketer, the broadcast marketer. Pardot software was built from day one to empower the business to business (B2B) marketer who wants to do one to one communication via email and to track what the prospects are doing on the website so they can have a better conversation with them and so that the sales reps are better empowered when they pick up the phone and talk to them. Pardot Company was a spin-out from Hannon Hill and then Hannon Hill was the first customer of Pardot.

Did you grow your companies organically or did you ever take outside funding?

The businesses grew organically and were boot strapped. I put a lot of money on a credit card and I borrowed a little bit of money but really just did it organically and boot strapped it.

How do you manage to run both Pardot and Hannon Hill at the same time?

From a business point of view, they are separate companies and totally separate employees but from an operational prospective in the office they are more like two different product lines. There are people in charge of departments and there’s a COO or President in charge of each one. I have a third company called Clickscape as well. Clickscape.com is a web-based real estate lead generation website for real estate agents. And then about this time last year is when I started Shotput ventures as well, which makes investments in very early stage, capital light web based businesses.

What advice would you give to upcoming Duke entrepreneurs?

If you spend too much time thinking about something you can always find lots of holes in it, which is a trap many entrepreneurs, especially smart Duke people, might fall into. My advice is to get out there and do it. Doing it and failing you’ll learn just as much or more than doing it and succeeding. The more you try and the harder you work at it the more things you’ll figure out. Any market, vertical, or segment you are interested in or that gets you excited for whatever reason always has inefficiencies and opportunities to create businesses. My take is that there are huge amounts of opportunity out there for innovation. Putting yourself out there and just going for it you’ll figure out where those things are if you’re not totally sure when you start. When I started Hannon Hill the original product was a $30 a month software as a service tool to update a website and we were never successful with that. But what we were successful with was a $60,000 tool for universities to update their website. We were still in the realm of web content management but wound up being successful with a product that was vastly different than what we started with. We wouldn’t have known that if we hadn’t put ourselves out there to learn and figure it out.

Were there any points where you were facing a significant crisis and how did you get through it?

The dot com crash had already occurred when I started the business in late 2000. It did get worse with September 11th but in reality having such a dismal climate to begin with forced us to be scrappy from day 1. It forced us to fend for ourselves and forced us to save every dollar that we could and be as frugal as possible. I think that definitely helped us a ton once things got a lot better. We were making a lot of money or generating a lot of revenue. We were then very efficient at how we deployed that capital to reinvest it in the business. I think the .com crash and the recession of the early 2000’s was a really good time to start a business because people worked for less money, there wasn’t as much noise because things had slowed down. There was little to no money out there from an investment point of view so you have to figure out how to make ends meet on your own. If you can do it on your own then you’re not beholden to anybody else. So I think starting a business in a recession is typically even better than starting a business during good times. So I think it’s a great time to start a business right now.

There are now a ton of options out there for open source and paid web content management. How do you differentiate yourself and how do you cut through the noise to get at potential customers?

There are literally thousands of web content management systems out there. Our magic bullet is the ability to manage lots of different websites that live on lots of different physical servers and have different templates and different rules all from one single server. So the really hard problem is that in the university setting you might have 100 different websites that live on 100 different physical machines that represent 30,000 different webpages managed by 700 different people. So it’s a really hard problem to solve to be able to have a CMS that can work in all of those environments. The vast majority of CMS’s are designed to manage a single website and a small minority of CMS’s are designed to manage multiple sites on the same server. So really it’s sort of like a file synchronization system in addition to a CMS.

So how do you see your companies evolving in the next few years? What are your goals and where are you aiming as the industry evolves and your company develops and grows?

From a companies and business point of view my take is just indentifying different problems and needs in the market and then building software or web applications to help solve those problems. It’s really about solving problems and providing value to people. For the company my goal is to keep growing the different businesses and make them as big and successful as possible.

How do you define the success for your businesses?

I don’t really define it very objectively. For me it’s just ensuring that we have a great corporate culture, people like coming to the office, we’re doing fun, new, exciting things, and our customers love us. So, for me, it's more about the lifestyle and enjoying what you do.

What are the attributes that a good entrepreneur has and is there any commonality you’ve seen dealing with those people in Shotput who have been successful in your opinion?

Perseverance is definitely near the top. Risk-taking. The ability to make decisions with limited amounts of information. The ability to recruit people and get them excited about your vision whatever that might be. The ability to take very little and create value out of it. The ability to iterate. The ability to change courses quickly when you see new opportunities or you get more information. At the end of the day I think there is some element of luck and timing along with old fashion hard work and adaptability.

Any final thoughts you would like to share?

Just do it, get out there, and start a company. The key thing is putting everything into it. I see too many entrepreneurs that are hobbyists, part-time, or moonlighting entrepreneurs. Very, very rarely have I met somebody or talked to somebody that did it part-time who turned it into something fulltime that was successful. The vast majority of the part-timers that I talked to over the years have not been successful. I think it’s very different when you are 110% focused on something vs. having a day job and trying to do it nights and weekends. Not to say you can’t do it, but putting your all into it definitely makes a huge difference in my experience.


Read more profiles of Duke alumni entrepreneurs