3 Hustlers, No Hackers: Scott Dorsey on Surviving Without a Technical Co-Founder

Blake Bartlett, Partner by

Starting a software company without a technical founder? Conventional wisdom suggests your first recruit should be a highly skilled software engineer, but ExactTarget’s incredible success might convince you otherwise.

Scott Dorsey had heard the advice. And he was well aware that building a software company without a shred of technical expertise sounded ludicrous. But when Dorsey and his co-founders, Chris Baggott and Peter McCormick, decided to found email marketing service ExactTarget, they didn’t have much of a choice. It was December 2000 — the middle of the dot-com crash — and ExactTarget was based in suburban Indianapolis, an area that wasn’t exactly known as a hotbed of technical talent.

Scott Dorsey circle“The old adage when you’re starting a software company is that you need a hustler and a hacker to really get started. We really were three hustlers and no hackers … with little to no technical know-how.”

— Scott Dorsey, co-founder of ExactTarget

Dorsey admits it was an “against long odds” kind of story, but that didn’t seem to phase he and his co-founders. Within four years, ExactTarget had raised its first institutional round of financing (a $10.5 million round led by Insight Venture Partners and sourced by OpenView founder Scott Maxwell). And in 2013 Salesforce acquired ExactTarget for $2.7 billion.

Dorsey recently sat down with OpenView’s Blake Bartlett to talk about how ExactTarget built a sophisticated software product without a single employee who knew how to code, and what advice he’d give to other non-technical software entrepreneurs.

Key takeaways

  • Exchanging equity for a Minimum Viable Product: To convert their idea into software, Dorsey and his co-founders hired an outsourced development firm to build a minimum viable product — and they did so without spending a dime. Because ExactTarget was bootstrapped and thinly capitalized, Dorsey instead agreed to exchange equity for the development work — a deal that very clearly worked out in both parties’ favor.
  • Hiring a CTO to expand product functionality and sophistication: ExactTarget’s early partnership with that development firm allowed Dorsey and his team to put a product in front of customers and start acquiring customer feedback without burning through a lot of cash. When Dorsey and his founders felt that the company was ready to take its technology platform to the next level, they hired a CTO.
  • Focusing on strengths and outsourcing weaknesses: Ironically, nearly a year after leaving ExactTarget, Dorsey is considering taking coding classes to learn the finer points of software development. But back in the early 2000s, he survived as a non-technical CEO by focusing most of his energy on his strength: being a business architect instead of a technical architect. That freed him up to invest the bulk of his time into fine-tuning the company’s business model, product roadmap, and organizational culture.
  • Advice for modern non-technical founders: The key, according to Dorsey, is balance. While technical expertise is arguably more important to B2B startups today than it was in 2000, Dorsey believes it’s a dangerous equation if companies are too weighted in that direction. Put another way, technical expertise is important. But entrepreneurs must also make substantial investments in their go-to-market strategy if they want to control their own destiny, grow top line revenue, and generate the cash flow their business needs to scale.

Learn more about Dorsey’s story in the full interview: From Back-of-the-Napkin to $2.7 Billion Exit: Sitting Down with ExactTarget’s Scott Dorsey