His first company at age fourteen — a car-washing business so he could drive other people’s fancy cars.
He’s personally started 34 businesses and run 17 of them. He’s led 50 financing rounds.
Scott Painter is the definition of the serial entrepreneur.
In an interview with Mark Suster a year ago, Scott explained how he uses marketing analytics to manage and finance his current venture, Zag.
Zag helps consumers buy cars over the Internet. It pre-negotiates prices through its relationships with thousands of dealers. Zag thus makes it possible for consumers to get the best price on cars and to avoid negotiating with the dealer.
How does Painter track and analyze the key metrics of his rapidly growing business?
He uses a measurement, analysis, and modeling application that Zag built for itself.
Here’s how Painter describes his dashboard:
What I’ve pulled up, this is our dashboard, an internal management tool. What it does, it transparently reports our top of funnel (users), conversion rate, prospects, close rate, sales, and revenue over the last 30 days.
And then, this is a very important part of understanding our business, this is a flash widget that shows exactly how the business works.
If the only thing this marketing analytics tool did was to help Scott manage his business, it would be a powerful asset.
But Scott takes it much further.
First, it’s not just a monitoring tool, it’s also a model of the business. You can change the assumptions and see how the change would affect important marketing metrics like conversions and revenue.
Second, Painter makes it available to his staff. This way people in the company can see how their work impacts the progress of the company.
Not only has this become an incredibly important management tool for predicting how the business operates. It’s also very good at letting everybody in the company fully understand their contribution. So if I’m an employee and I’m working on a web design, I can come in here and say, if I affect conversion rate on the website negatively, how will that affect our revenue stream?
He also uses it when he seeks financing to help investors understand the business. And then once they have invested, they can continue to login and monitor the progress of the company.
It also happens to be the one great way to explain to an investor exactly how the business works. Rather than handing over a complicated financial model and then have your champion try to make sense of it, you can give them the model and let them play with it.
We’ve found that it hyper-simplifies for the champion at the venture firm to explain to the other partners exactly how this business operates.
Some takeaways from what Painter is doing:
- They built their own marketing analytics tool so that it would suit their needs.
- The tool is an integral part of how Painter manages his business.
- He makes the tool and the information available to his staff so that everyone can understand the business and their impact on it.
- He makes it easy for investors to understand the business by giving them a modeling tool where they can change assumptions and see the result.