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Looking to build, secure, market, and sell software products? Then this show if for you. Each "TYB" episode will feature a topic from a key area of building a digital business including product development. product design, and marketing. Some episodes will be led by team of experts from Applied Visions, while other episodes will feature special guests with domain expertise relevant to building a digital business. Every episode will leave you something actionable you can carry over into your business—and it will be presented in a fresh, fun way.
Welcome to the very first episode of the Transform Your Business Podcast, where we bring you insightful conversations with rockstar people who actually have the substance to help you grow your business digitally. Today we have an exciting guest who needs no introduction, but we're gonna give him one anyway, it's none other than Frank Zini, the founder and c e o of Avi.
Fun fact, Frank's also my boss, so no pressure there right now. We made a rule for this podcast that there must be no Snooze Fest episodes. There's enough of those podcasts out there, and I must say, at least for this episode, we stuck to that rule. Frank has been in the digital game for over 40 years, which means he's seen it all.
He's built digital products from scratch. He's advised companies, he's even taken startups all the way through acquisition, and if that's not impressive enough, he's also the mastermind behind Digital Business building, a unique approach that we're gonna dive into today. So get ready to be wowed by Frank's wisdom and insights.
I couldn't think of a better guest to kick off our podcast journey, so let's get started. So I couldn't think of a better guest to have on our inaugural episode than the CEO of Applied Visions, frank Zinghini who's been doing this for more than 30 years. So, Frank, thanks for joining us today.
Hey, it's a pleasure to be here, Jim.
And so, you know, today we're gonna talk about building a digital business, right? In the, the entire premise of the podcast is to transform your business. And we talk about digital business building. And so that kind of seems like the most natural place for us to start. So I guess kind of starting out, you know, talking about.
Defining what digital business building is. You know, to me it's, you know, I look at it like the future of how technology's actually gonna be built. You know, like, and what we're doing is using a specific framework to demonetize the business, you know, build unique value for your market. Um, understand really how to articulate and sell the value, and then make sure you can continue growing scale.
You know, your customers as you grow. But I want to hear from you. That's a great perspective, Jim, and, and you hit something very important there. And yes, uh, we've been building technology for 30 years, but it's more important really to build your business and what a lot of people don't realize that in today's world, uh, There's no longer a difference between your product and your business.
Your business is your product. Um, whether or not you're selling something tangible or you're selling a service, whatever your product is, your customers are gonna relate to your entire business as a single thing, and they're gonna look at that relationship and decide, do I like working with this company or not?
Do I like their product or like how they present their product. I like how they take care of me or not, and the expectations for that relationship. Are very, very high nowadays because everybody else in your marketplace, everybody else in your customer's world, is providing this high level of connection and service through digital interactions.
So when we talk about transforming your dis business or creating a digital business, it's about taking whatever you're doing now and saying what is the missing component here that builds. A rock solid relationship with my customers, where they are interacting with me digitally through all avenues that they're used to doing, where they're able to take care of themselves, where they view my product and my business as one thing that they want to have an ongoing relationship with.
Let's, let's slightly transition here into something that we've been hearing for years, right? And it's almost becoming overuse to the point of a buzzword, right? And that's digital transformation, right? And so when I look at digital transformation versus digital business building, again from, from a non technologist perspective and to kind of, let's say, dumb it down a little bit.
You know, I look at digital transformation. We're like turning a toy car into a Tesla, right? You know, you're using the technology to make things easier, faster, and better for your customers. Where I think digital business building comes in is not only are you, are you doing that, but you're taking a lot more into consideration, right?
So before you build the Tesla, we wanna know what the business outcome is going to be, right? You know, what, what is is it to, you know, increase your bottom line by 30% by, you know, going from high market to mid-market, you know, things like that, right? Those real considerations. And then really understanding the niche that you're trying to serve, right?
I, I see too many companies building technology. And then trying to almost retrofit into a particular niche, you know, within a market. Right? And, and that doesn't really work well. So understanding who it's going to be first, right? And then knowing how to position the product specifically to that audience before you even get into MVP mode, right?
And then, you know, as you bring the product to market, We wanna know, you know, what's the go to market motion look like and is there an ability before you even launch the product to potentially warm up your audience, get them to almost pre-buy, or at least, you know, show some pred demand for it. Um, and then, you know, lastly, the consideration I think is often missed is the security of it, right?
Building that in from the beginning. So again, it's not just the component of building the technology, it's all the stuff around it that is really the reason why you're building the technology in the first place. But, uh, I'd love to hear what you think. Yeah. Well, and what you're saying is very important and.
It's a subtle difference, but it's a very important one. When people talk of digital transformation, they think, well, I have a business. I have a product, and if I just put some of that digital stuff in here, it'll be so much better and my sales will go up and I'll have more customers and all that. It's not that simple.
It's really changing your business, and by putting digital first and saying digital transformation, you're not even recognizing the impact on the business. You really have to come at this from a perspective of, I'm reinventing my business to have a substantial digital component. Now, the, the underlying work is the same, but it's more a matter of perspective, and this is why we talk about.
Building a digital business rather than just digital transformation, cuz it's not as easy as just throwing some digital stuff into your business and all of a sudden everything is better. You've really gotta look at your entire relationship with your marketplace, with your customers, and how that can work as a.
Digital first business, and it doesn't matter whether you're selling a technology product or a non-technology. If you're selling cheese, you still have a digital component of your business because your customers want to interact with you in the digital domain. They want you on their phones, they want you on their websites.
They, they want that relationship with you because they have it with everybody else they do business with. So you have to focus on the business and how does your business change when it becomes a digital business? And that's the change in perspective on those two, those two views of, of, of the process.
And you're absolutely right. All those things you listed, they're necessary in both cases, you know. Understanding how to do it, understanding your customer's journey, how to implement that journey in the way that they wanna work with you, how to get it live, how to make it scalable, how to make it robust.
How to make it secure. You have to do all of those things no matter what you call the process. But when you focus on building a digital business, you're focusing on the business first. And how does digital technology serve that business goal? Yeah, and I, I always drive it back and I ask, And I ask, uh, you know, customers or prospective customers, you know, who do you define as your perfect customer, right?
For, for this technology, right? And, and really, you know, what, what gap in the market can you feel for them? Like, what pain are they having that you alleviate? And if it's not, if it's not substantial enough to make them act, or, you know, Get out of the status quo, which is oftentimes your biggest competition, then why are you building it in the first place?
Right. So I think, you know, I think asking those things before you even get to work on building the MVP or building the product, you need to understand those things. Right. And then, you know, I like to take it a step further and even start to understand, you know, the marketing part of it. Right. And you know, I think people often intertwine, you know, positioning with messaging, but like the positioning goes back to the business, the business strategy, right, which you've been talking about.
And that's. You know, understanding, what's the context here? What's the frame of reference? How are you different than any other, you know, any other product on the market. And you know, as a marketing guy myself, I always look at, you know, you take Salesforce, you take HubSpot, right? And when you think Salesforce, you think, okay.
Really robust, you know, a little bit complicated to set up and integrate. You know, it's probably for your bigger organization, right? And HubSpot could've come in and said, you know what? We're building a, you know, a CRM just to go head-to-head and compete with Salesforce. But they went down market to people like myself who, you know, does marketing for startups and smaller businesses who doesn't have a huge operations team.
And they said, you know what? This practice for you, and you go in there and it's. It's so easy to set up campaigns and to, you know, and to list build and to set up nurture, you know, nurture tracks and all this sort of stuff that you want to do. And I think all companies should think about that before they go out and build.
It's really what's unique here, right? What's the secret sauce that differentiates me from, from just everyone else? Absolutely. And what you're describing is the process of creating an actual digital product, and that's all extremely valid and. We can have many episodes just talking about that part of this business, of turning your business into a digital product.
But even if your underlying product itself is not digital, or if your underlying service is not something that can be done all digitally, you still have to go out and meet your clients. That layer of interaction with your customers in the digital domain is critical and, and you need to understand where they want.
To meet you and an exercise that a a lot of business owners just failed to take, and it's a simple, fundamental exercise, is to look at their own lives. Who they interact with as a consumer, who they interact with as a, uh, homeowner or bank user, or all the things they use in their own lives and also their business partners.
Look at how all those work with them in a digital way. Then look at their own business and say, am I doing that for my customer? More often than not, the answer is no. And a business owner might say, yeah, well that's just too hard. It's not too hard. It can be done and it has to be done because if you don't do it, your competitors are gonna do it.
But that simple test is my treatment of my customer even remotely as good as my bank is with me. That simple test, uh, is often, often failed. That's, that's great. Um, and I guess, so we've been talking about, you know, I guess how to get started, what to do. Let's talk about, you know, cause I always wanna make this as actionable as possible, you know, key mistakes, right?
And I ha over your years, is there a type of mistake or series of mistakes that you, that you see constantly coming up that companies make that really hinder their progress or maybe even stop their projects altogether? Yeah, there's a lot of them and you know, it sort of sounds self-serving when I talk about them, but I'm gonna say it anyway.
The biggest challenge to this digital business building process is a lack of appreciation for. The complexity and the rigor of actually doing it. And by that I don't mean this is so hard you couldn't understand it. It means recognizing that building the digital component of your business is about as significant as building that new factory I talked about earlier or.
Modernizing your shop floor or any other process that you would naturally think, well, that, that's complex work and that requires some rigor and that requires some professionalism, and there's a certain way to do that. There's this unfortunate feeling that has grown up around digital technology that.
Because almost anyone can claim that they do it. They can do it. And there's a lot of people who claim they can do this, who can't. It should be easy and it should be cheap and it should be fast. And you know, you may hear some story about, oh guy I know you know, did this in a week. Why are you telling me it's gonna take a year?
You have to recognize. That this is a substantial investment in your business in terms of time, in terms of money, and in terms of opportunity that if you go down this path and you approach it in a a certain way, you're not doing an infinite number of other things. So you've made a choice that I'm gonna go down this path and down this way.
If you give it short shrift, if you don't give it the respect, And the discipline and the rigor it deserves, you're gonna hurt yourself. And that's probably the biggest mistake. And again, it sounds self-serving cuz Yeah, I'm saying you need to deal with a professional, whether it's us or some other company, and there's plenty of them.
You have to deal with professionals who know how to do this and apply the time and the resources necessary to do it right, and to do it in a way where you can see where you're going and achieve your vision. And that's the, the perspective of, well, it's just an app or looking at the app in isolation is, well, I just need an app and then everything else will be better is where it falls down.
Um, Yeah, like saying, I just need a perfect salesperson, so let me just go hire the first salesperson who walks in the door. You're not gonna do that. You're an experienced business owner. You're gonna really work hard to find the right salesperson. You're gonna make sure you have the right sales processes within which they can work, so you can MI and so forth.
You're gonna give that some rigor. You can't. Just turn around and say, I need an app. And I, I know a guy who can write an app. You know, TikTok, as you said, it's an app. It's a cool, there's a whole business behind it. But what you see on the surface is just the app. You need to understand that if your business can benefit from having that digital connection to your customer and that digital connection is best served by an app, great.
Now you have to build that whole thing into your business process. Right? And so I guess, um, Let's talk a little bit about maybe just the, the three vectors of what would, what would make sense to actually build a product? Right? And for me it's, you know, either drives revenue, um, it increases the efficiency and therefore perhaps limits the amount of people you need to work on a certain thing right?
Within your business, or really, you know, it, it pleases your customers, right? Delights your customers on the backend. Right. Is there one particular area of those where you think, you know what. It's more important to go for it than another, or do you think that, you know, they're all kind of equally important the way, uh, the way business works today?
Well, they're all in for twice. Um, delighting your customers is a wonderful thing, but why do you wanna do that? Well, presumably because your competitor is also working on delighting your customers and would love to take your customers away. So that's the first step. You wanna retain your customers and maybe you wanna get new ones.
So customer delight is critical. But then again, you may be in a business where you have a captive audience and you know, there's delight and then there's satisfaction and you know, there's, there's, there's. It's sort of a, you know, layers of that. But in the end, you want your customers to be happy with you as a business partner because they almost always have other choices, um, growing the revenue.
Well, that's part of that, right? It's, it's making your product a service sufficiently attractive so that more people want to use it. Um, the efficiency thing is, is. Is critical in a number of different ways, and traditionally when we think of it and technology, it's always been from a sort of process efficiency basis, what can we do in the back office to make it better so I can lay off a bunch of people and still get the same amount of business and that hasn't gone away.
That's all still part of building a digital business. The difference in recent years is a lot of that becomes transparent to your customers. The, the concept of people self-serving bad, being able to manage their own accounts. I personally, as a consumer, get really annoyed if I'm dealing with a business that won't let me go in and check my most recent order or find the thing that I ordered three months ago or see what my account balance is, or any manner of self-service.
I just take for granted now that any. Business that I work with as a consumer or as a business partner would have that. And I find myself disappointed if they don't. Um, so. In terms of expanding revenue, that's a key part of it. And it all boils down to again, is what are your competitors doing? What's your marketplace demanding?
Uh, you don't want people walking away from you because they tried working you, and it's just too hard. They don't wanna pick up the phone and sudden hold for a while or send an email or whatever. They want to be able to take care of themselves. You have to be sensitive to. What your source of revenue is and how sensitive, how sensitive it is to those sorts of failings.
Now there's also what new avenues of revenue can you open once you have this digital thing? And that's a much longer discussion and does differ business to business. But if a, a business owner looks at what they do, And says, if I actually had this relationship with my customers, what might I do differently?
Not just help themselves serve, not just increase the efficiency, allow me to do more revenue with fewer people and all those good things. But what are other opportunities? Does it open up that I didn't have previously? Maybe it's geographic, as I said earlier with the service business. If I have a personal service business and I work with people locally, but I have value to offer everybody else in the world, maybe it's different.
It's not the one-on-one face-to-face work I'm so good at with my customers, but I can take some subset of my knowledge and make that available to the rest of the world in this digital layer and bring in customers I never had before. So all of those things are critical. I mean, the answer is, yeah, all three of the things you listed are important.
You have to look at each one differently based on what your business is and who your customer is, but they're all important. Yeah. And one last topic before we, uh, before we break off here. Um, you know, one thing that. I think is, is still a problem, particularly more for traditional analog businesses is, and it's kind of excuse, right?
Like, this doesn't work for me. Right? It seems to work for every other business in the world, but this, this, this doesn't fit my business model. This doesn't work for me. Right. Um, how do you answer that? You know, people that say, I don't need this in my business. You know, we're fine the way we are. We're t trudging along.
We're a networking first business. I gotta touch and talk to everybody. Do you think there are still businesses like that? There certainly are. Um, I guess my first answer would be, if you're happy with the way your business is now, why change it? Why make that investment? Are there businesses where they just fundamentally are not open to a digital relationship?
Yeah. Uh, Mike. Car mechanic. Um, he doesn't feel the need to have a web portal where I can log in and see if he's done changing my tires yet. He just waits for me to call him up or he calls me and he's content and he is doing enough cars and he's happy. There's plenty of businesses that don't need. A digital layer don't need to become digital businesses.
As long as the business owners are happy with what they've got and just want to keep doing that. It's not something you, you'd force on people. Their customers start forcing it on them. It's different if customers are saying, I don't understand why I can't do this with you, when I can do it with all these other companies.
You have to respond to your customers. The point you made earlier about. Your exit is something we actually see quite a lot of, and it's interesting, mature companies, 25, 30 year old companies that are doing a successful business, whether they be a manufacturer or a service business or some other bus.
Reaching the point where owners are thinking about retirement or exit and they go out to the marketplace with their business, a, they'll hire a broker and the broker comes back and says, well, we looked at your marketplace and you've got all these other businesses in your space that are doing all these other things that you don't do.
Your valuation's gonna take a hit. So if your competitors who have all these digital components of business, we're giving them a pick a number, you know, 12 x EBITDA evaluations because of this side or the other reason, and you don't have that, Frank. Um, so you know, your evaluation, we're gonna take you to market at five x because you're a, I loved your phrase, analog business.
You're, you're a traditional old school, old world business. You don't have these things that the marketplace is now demanding. So your evaluation is gonna feel that hit and. It's something that people ought to think about, not only competing with other companies for the business they have now, but making sure they can compete when they want to exit.
And have the, the modern capabilities that the marketplace is expecting. Yeah. Yeah. Well, Frank, this has been great and, uh, I, again, I couldn't have imagined someone better to kick us off on transferring your business, though. Thank you so much for joining us today. I hope, uh, I hope everyone got a lot out of this.
I, I sure did. So thank you. Thank you, Jim. This has been great and I'm looking forward to the series.