Growing Lean
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Growing Lean
Scaling Success: Jan Rippinggale's Journey in Tech, Renewable Energy, and Business Strategy
Rippinggale’s innovative software-as-a-service pricing model is a masterstroke that captures growth upside and has catapulted BlueBanion as the leading ERP system in the solar industry. Get an insider's perspective on the complexities of scaling professional services and the importance of small wins for fostering team cohesion. Soak in the wisdom as Jan shares crucial insights on measuring business success and offers unmissable advice to fellow entrepreneurs. This episode is a treasure chest of great ideas and strategies – an absolute must-listen for those intrigued by business strategy, pricing models, operational efficiency, and renewable energy.
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Welcome back to the growing Lean podcast sponsored by Lean Discovery Group. This is your host, dylan Burke, also known as Deej. I'm happy to be here with Jan Rippinggale, founder and CEO of BlueBanion. Welcome, jan.
Speaker 2:Thank you, dylan, I'm glad to be here.
Speaker 1:Good to have you here. To get us started. Can you give us a little bit about your history, your background and how you ended up doing what you do today?
Speaker 2:So I have a different background probably than typical. It actually started when I was nine. I was going to be astronaut and president, since I've always been a bit ambitious and I worked for NASA several different points during while I was going to school and college and university and I got a chance to meet John Glenn because I was always interested in not only engineering but how it's applied to make people's lives better and John Glenn. So I was doing a Washington internship for students of engineering and there were only three engineers in all of Washington and John Glenn was one of them. So I talked with him about my interest in becoming an astronaut and the most recent NASA funding request that was up in front of Congress and he said that he couldn't support it because he didn't see the value compared to the value of putting that money towards education in the United States.
Speaker 2:And I think that was a very interesting point that he made about his priorities and the use of the stewardship of the government funds that he had at the time. And it was perfectly clear to me that I did not have a career path that if John Glenn wasn't willing to put NASA, this was not a plan that was going to work, and that's when I pivoted and went into computer science and I have been using computer science as my technology to make the world a better place. And so BlueBanion is about. We have developed business systems for solar installers and we help them run their businesses more efficiently so we can deploy more solar faster, get more of that money going from back into office operations into actual infrastructure and benefiting us that way.
Speaker 1:Okay, amazing. So is that your primary product?
Speaker 2:It is our flagship product.
Speaker 1:It's called Solar Success Okay awesome and yeah, so I love the story about NASA. So, Pity, you didn't get to be an astronaut, but I guess it builds character.
Speaker 2:Exactly, my children are still interested.
Speaker 1:That's awesome, so what else is it? I checked your website and there seemed to be another platform for construction. Is that correct?
Speaker 2:That is correct. So we have about a third of the solar residential solar market is operating on solar success right now, and so we are extending a lot of the insights that we've had for construction to build our success and bringing the same insights from solar into the specialty contractor markets with builder success as well.
Speaker 1:Okay, amazing. So it's pre-made solutions that you're selling to these companies?
Speaker 2:Exactly and data-driven templates to help them do their project management more repeatedly.
Speaker 1:Okay, awesome, and so I see it's been about seven years. Is that correct?
Speaker 2:It is. It has been a long journey.
Speaker 1:What are the biggest challenges that you faced over the last seven years and how have you become new?
Speaker 2:So we faced a bunch of different challenges. Life on the solar coaster which is what everyone in the solar industry calls it has been intense. The biggest core challenge through everything has been maintaining even cash flow, because we've had bumps where anything with solar was sold as fast as it could get. Businesses that just had investors wanted to get on solar success and move and then it didn't even have a single transaction yet. We've had times where sales were that easy to make and it took two weeks to do an ERP sale, and then we've had times where it doesn't matter no one's buying software because they can't even buy modules.
Speaker 2:We had the entire shutdown of the supply chain post pandemic, but also then seeing the slave labor issue that was going on with China and so we couldn't import any foreign made solar panels for six or eight months.
Speaker 2:It was really intense. So the only people who made it were the people who had big warehouses of solar panels, which is typically not cost effective. So a whole lot of people were really suffering. So that was a real challenge. And then we get over that and we get everything coming in and the inflation reduction act gets passed and we're gonna get all this big infrastructure money coming in for solar, and that comes in and gets passed in August which is right as the interest rates start climbing and so all of a sudden the price to install solar at your home is almost double what it was at one and 2% interest, versus seven 8% interest. And the sales totally tanked Right after we got this big money and we thought it would take off. So maintaining even cash flow when there have been huge industry chefs that we don't have any control over but dramatically affect our clients has been really challenging.
Speaker 1:Okay, yeah, I can imagine how tough that must be. And so what is your business strategy and how do you prepare for any unforeseen circumstances?
Speaker 2:So we from the beginning we had diversified so that we also supported other areas of the of the on Netsuite platform economy. So we had, like regular technical business and there were several times when I was very tempted to concentrate on just the solar industry and not be diverse, that we were also addressing kind of retail market and distributors and these kinds of people. And I am so glad that we maintain that diversity, that literally that year, this year, it's been the difference between being able to make it or not. So it really mattered to maintain that diversity and I kind of thought of it as a tripod that we needed to have at least three sources of revenue. So we've got recurring revenue from our software sales services on solar and then services and in Netsuite just business and general technical services. So that has really helped us.
Speaker 2:Then the next strategy is, of course, to move into the adjacent so that we're in the larger construction, because the larger construction is doing better than solar is right now and so that should even out the bumps along the way. But anytime you split your attention, that has got a price too. So so it's like going through a journey where there isn't a solution. That's not going to have a price. Every decision option that you're going to make has a price, and you're just choosing which price you're going to pay. So the price for diversity is lack of focus or needing to maintain multiple focuses at quality. The price for being focused would be that we'd have to go on the full ride with the solar coaster, and that can literally be deadly. So I ended up making that choice based on worst case scenarios, and the solar coaster being deadly was too high a price to pay.
Speaker 1:But the absolutely diversification has a price too 100%, and can you speak to any metrics or KPIs that you use to measure the success of your business?
Speaker 2:Yes, well, we actually have some interesting. We have all of the standard KPIs that you would use, like cashflow and EBITDA and these kinds of things. We've also kind of developed a new metric recently around quiet quitting, where in the professional services side of business you can have clients that effectively quiet quit you while you're moving along, particularly if you're doing time in materials, and that can be very slow and you cannot notice it. For instance, the solar industry was contracting and our existing clients were ordering more services, fewer services, just because they had less cashflow, but they were still ordering services and engaging with us, and so we didn't notice until a little late in the game that we had this kind of client side quiet quitting going on.
Speaker 2:So now we're actually converting our client like a stock portfolio and we're looking at gainers and losers, people who are moving up in their average clients, who are moving up in their spend versus reducing, and how many gainers and losers we have, and we're looking at our clients as a portfolio as a whole and then we're using a pivot table to check and see do we have more gainers or losers by captains or account reps that are on those accounts, or do we have more gainers and losers by industry or do gainers or losers by manager.
Speaker 2:See if we're getting the right management going on. And this gainers and losers KPI and looking at our clients like a socks and portfolio kind of pivot has been super effective for us. So really catching the right people doing it well and the people who clients want to continue to work with, no matter what the economic situation, is really high value versus lower end people. So it's really been great for us to discern people who are doing a good enough job and people who are doing a great job. We work remotely, 100% remote company, and it's really hard to tell because when you have one on one, everyone says it's going great, like an interview. But this has been one of our you know, brutal, brutal truth KPIs, letting us know what's actually happening.
Speaker 1:Okay, amazing. I'm glad that you've figured it out and you've got a way to overcome that. I love hearing about people finding issues and solving them. That's what gets me going in these podcasts. So do your clients. Is it a software service that they buy, or is it like a monthly subscription? Or do they pay a fee per transaction? How does it work?
Speaker 2:So we have a software as a service and it's typically annual in advance and we have a module fee for a base price because if it goes below a certain amount it's not worth our time to even get it installed and getting it up and running. So we've got like a module fee that gives us a floor for a minimum pricing and then we have per user fees so that we capture some upside on growth. As more people are using the system. Also, the more users you have, it actually does require more attention and higher quality coding to be able to scale. So that's our model for that product. We do have some other products with different models, like we've got a chat with SMS and we charge a base fee plus usage, because that can be all over the map for different clients and we need to protect our potential downside of engaging on a per user model.
Speaker 2:We've thought about a lot of pricing structures and what we found is that clients understandably aren't super excited about revenue based pricing models because you're essentially giving away equity of your company as you're growing and they're not realizing the benefits of the operational efficiency gains.
Speaker 2:Also, as they succeed and do really well, you would think that they would be even happier to pay you because they're obviously doing well and they have a lot more money, but what that means is that you're just ripe for getting undermined by a competitor. So our competitors are using revenue based models for their pricing and we are going after that and we've thought about mimicking it and we've ended up deciding that delivering operational efficiency gain is really how we're going to have ongoing performance and value, and that we won't be able to be matched or undermined really in that. In delivering that but there is definitely our competitors are capturing more upside than we are right now, but then they ended up losing it too. So it's a tricky question about how exactly you should do it. So we've ended up deciding that this is our sweet point right now, and I don't know that we're not going to experiment with additional pricing models.
Speaker 1:Still, okay 100%, and where would you? I don't know if the stats exist, but where would you rate yourself compared to the competitors?
Speaker 2:Are you in the higher percentile or or a solar business for the micro vertical firm oracles, the defines. Oracle defines solar as a micro vertical. It's really energy. So it's not that micro, but in that micro vertical were number one. There isn't a better ERP system than us In construction. There isn't actually a good system that is got both project management and accounting tied together, which is where a huge number of the operational efficiencies come together. But are we have piecemeal competitors and amongst those piecemeal competitors we're in the top 10. But we're still, for early days, getting that out to market.
Speaker 1:Okay, amazing, and I know I'm backtracking here a bit, but I wanted to ask during your entrepreneurial journey over the last seven years, what have been the most notable milestones or accomplishments that have happened for your business?
Speaker 2:I know. So for the business the biggest milestones have been getting your first sale of the software is their biggest first milestone. It sounds like it should be trivial and I thought it would be much easier than it actually was. So the first paying customer is huge milestone, getting to where we had a third of the top 100 and we've got half of the top 10. And then watching our clients our largest client went from five to three to one and recently they said that the biggest pivot for them was getting on to solar success because then they were able to flexibly grow their business and scale and that is how they moved faster than everybody else when the industry was growing big. That was. That was a huge milestone because it was a very visible proof point to the entire industry that improving your operational efficiency, the construction people are not so interested in digitizing all of their data. It seems it's such a pain because there's so many details that the humans are keeping track of in their brains that getting that tribal knowledge out into a system is often a multi-year journey for a company to do it well and to do it right and to show that the benefits are really there and you can scale faster and you can improve quality more consistently. It was a huge milestone. So having these proof points was great.
Speaker 2:And then the next thing was how to scale the professional services. Oh my goodness, that has been a challenge. People have flat out told me that obviously you can't scale professional services by definition, and that has been very annoying and it hasn't been simple and I'm not sure that we're there yet altogether, but we have definitely made positive strides forward in how this is done. But yeah, every milestone and every mountaintop you reach is awesome and you really do need to celebrate it, because otherwise it's totally exhausting, and then you get to see all the other mountains. So both are true. As soon as you hit any milestone, you're like, oh my God, there's so much more to do and I have really needed to learn to celebrate as we went along because, oh, it's just too exhausting, you've got to have joy.
Speaker 2:It's way too much of a grind.
Speaker 1:Always need to celebrate the small ones. It's part of putting the whole puzzle together.
Speaker 2:Exactly, and it makes a huge difference to employees. One of my major chefs that made a huge difference in our culture since we're all remote is I use Giffy's. Giffy's all over the place so somebody does something great. They don't just get an emoji, they get like a star that highlights how awesome they are. And that really developed a lot of connection and so we use Giffy's all over the place now and it's been a game changer for us and I'm like I'm not fucking CEO, you can't tell me I need to search through Giffy's right one, but it has really mattered to team cohesion so it's worth your time.
Speaker 2:Even though it's absolutely a pain in the ass.
Speaker 1:Yeah, I feel that I used to think it was like silly and false motivation, but I've noticed, especially in my previous role, it definitely boosted teamwork and camaraderie, making everyone feel a bit lighter in the work that they do, even though they were still doing the proper job. So definitely, it definitely works. I was leading to my next question with the accomplishments one. I wanted to know what would you rate your business in terms of your satisfaction on a scale of 1 to 10 today?
Speaker 2:Well, so I am a founder and CEO, so my satisfaction with my business is probably a three. Doesn't that sound terrible? It's not because I think we're doing a bad job. I don't think we're doing a. We're obviously doing a good job. I see how much more I would like to be able to do and I need I need to improve my ability to have the clarity to get everyone on the same page and moving forward in the right direction, while also being independent minded and empowered and having autonomy and needing to upskill everyone so that they can actually get more productive work done in the time frame. So we're a relatively small team and we need to, and we are consistently hitting above our kind of weight class, but we're, we need to keep doing that, and there's a lot of room for improvement. So I have a much bigger vision than what we've actually been able to do so far, and so probably I see it as about 30% baked Okay, like I want to see this whole thing actually come out and do better and do more 100%.
Speaker 2:So for me it's. No one else in the company would think that I don't think, but for me I've got a much bigger vision than where we are right now. We are the most successful micro vertical that Netsuite has ever had in their history. No one's ever including Netsuite has never done it as well as we have. We've got a lot of these major accomplishments and there's so much more to do 100%.
Speaker 1:And if we were to meet again in three years time and ask you the same question, what would you rate your business or what would you want to yourself to rate your business?
Speaker 2:Probably a five, because hopefully I will have honestly accomplished more of this vision and I will have gained more understanding about where we really do need, how much further and more we can do. So I'm expecting I would like to be further along. I'd like to have more of that pie incarnated into the world and working, and if I haven't grown to where I can see how much more we can do, then that will have been a failure on my part.
Speaker 1:Okay, 100%. I appreciate the honesty and thank you for that. We are running out of time. We actually have it over time. I didn't notice. But before we sign off, what advice would you give to other business owners, firstly, looking to succeed in your industry and secondly, what advice would you give to, let's say, solar companies looking to succeed, because you've obviously seen what works and what doesn't?
Speaker 2:I would actually recommend the same advice to both of them, which is kind of like cure from the core.
Speaker 2:So when you're looking at whatever problems it is that you need to solve, solve the hard problem. Solve the problem that's at the root of the issue. So if you're tired at the end of the day, is it because your work is too much conflict or you can't get along with your kids, or your work is too hard, or is it because you weigh too much and you haven't had the right food and you didn't get enough sleep last night? So usually the hardest answer is the core root of the problem, and if you solve that, the rest of the problems go away. So figuring out where your data is supposed to be and who has the data at the right time is like the root problem for a lot of solar installers, and actually addressing that problem makes all of the ripple effects of not having it done right the first time go away. And so if you can cure at the core even though it's almost always going to be the hardest answer that's going to give you your biggest bang for the buck.
Speaker 1:Amazing. I appreciate that and I completely agree. But thanks, Jan, for your time and for being on the show. Is there any way people can reach out to Jan Riffengill If you have any offers for them to take advantage of or if they're just looking to follow your journey?
Speaker 2:So I am on LinkedIn and Jan Riffengill and there's my email is just Jan at BlueBanioncom. So I'd love to hear from anybody who'd like to reach out to me on either of those ways If they are participating and have any interest in data standards for the solar industry. We are I'm running the Orange Button Working Group and I'd love to hear from anyone interested in that and helping that effort. We are getting permitting from taking 27 days to 2 days to 75 minutes, so it's making radical change. So if you want to help, pitch in, reach out and let me know.
Speaker 1:Amazing. Thanks so much. Thanks so much Jan.
Speaker 2:Thank you so much, Dylan. Have a great day you too. Thank you for inviting me.