The presentation ran for an hour and a half. The Dean left the room and everyone fell silent.
"Is something wrong?" Shulman asked.
"You just set a record," the table responded, wide-eyed.
"A record for what?"
"For keeping his attention."
Steve Shulman, entrepreneur and principal at B3i, knew he was onto something.
Two careers collide
Shulman has had the “entrepreneur bug” for many years.
But that doesn’t mean he’s your stereotypical college-grad building a startup in his parents’ basement. Or an “idea guy” who’s always tinkering with the next failed invention. In addition to running marathons and almost becoming a professional accordion player, he has a long and varied work history.
Shulman has an MBA from Columbia University and did post graduate studies at MIT Sloan. He co-founded a printing firm, ran it for 23 years, doubled it in size, and sold it to an international conglomerate.
After selling his printing firm, he returned to higher education—where he had started his career after graduate school. He served as a VP at Lesley University, then moved to Dartmouth Medical School, where he managed the budget.
At Dartmouth, Shulman recognized a problem. He realized that many research universities use a faulty approach to financial planning, leaving them susceptible to bad decisions. When you're dealing with the finances for an entire university, bad decisions are really bad decisions. Luckily, Shulman had an idea for how to fix this.
That idea brought his seemingly disparate careers—business and higher education—together in one product. He launched his own consulting practice and began developing a business intelligence tool to help research universities make smarter financial decisions.
"The methodology is simple," Shulman says, "but no one had thought of it."
The anatomy of a very good idea
Several factors gave Shulman's idea enormous potential from the start.
1. Industry knowledge
Paul Graham pointed out that good ideas are "generally the result of some external stimulus hitting a prepared mind." Shulman didn't have to research the higher education niche; he had been immersed in it for years. He was aware of how his target customers—executives at large research universities—managed finances, having done so himself.
2. Early prototype results
To test his idea, Shulman built a model in Excel. The model showed that research universities use inaccurate methods to create financial forecasts. Compared to Shulman’s model, original forecasts were off not by thousands of dollars...but by millions. Huge margins! These early tests demonstrated that his approach wasn't just theoretically sound, it really worked.
3. Early customer support
Several of Shulman's early consulting customers were excited about his solution. But his first concept wasn’t perfect—no one’s is—so he involved their feedback. He listened closely and addressed questions from skeptics. If anything was more complex than valuable, he removed it. Because his early prototype was built in Excel, he could make these changes rapidly and continue building trust and excitement. By charging customers for consulting work, he also validated that customers weren’t just interested—they were interested enough to pay.
Between experience, early results, and enthusiastic customer involvement, Shulman was onto something good. Really good.
Chasing scalability: from prototype to SaaS
Before Shulman's idea was called B3i, it was a very large model in Excel, called the Shulman Solution. At that time, the solution was 140 worksheets all linked together—a mega-spreadsheet.
To refine this prototype, Shulman consulted with customers for 8 years. He exhaustively tested his systems and methods.
Despite these improvements, the spreadsheet had notable limitations. For starters, it would take 50-60 hours to onboard someone to the model. While a spreadsheet had been the perfect starting point, it now put a growth cap on Shulman's options for the future. To scale, he needed to turn his spreadsheet into software.
That's when he approached us.
After talking with Shulman, we knew his solution had incredible potential. Andrew, our fearless leader, remembers his first impression: "[Shulman was] driven, smart, and knew a TON about his field."
We also knew that the prototype could make a great B2B SaaS product. After years of running an agency, we get excited when we hear the words “I have an Excel* spreadsheet.”
We get doubly excited when we hear that an entrepreneur has:
- A clear vision for impact
- A defined target market
- Valuable connections
- Interested customers
Shulman had every one of these crucial pieces. In October of 2017, we began an 8-month sprint to brand, design, and develop the first version of B3i with Shulman.
*Excel is great because you can iterate on a spreadsheet faster than code. This gives you a way to iron out kinks before you invest time and money into a complex MVP. It’s easy to adapt, but it’s also clunky. If you can get customers excited about the rough experience of using an Excel spreadsheet, they’ll be extra thrilled by the smooth user experience of your polished MVP.
Instant, intuitive, and indispensable
Shulman’s overarching goal is not just to build a successful company, but to change the culture at research institutions. To do that, B3i has to be instant, intuitive, and indispensable to his customers.
To make the tool instant, Kevin, our lead developer, translated Shulman's complex calculations from Excel to Python. Just like you have to understand an English message to translate it to Spanish, Kevin had to understand the Excel calculations to translate them to Python code.
Now customers can upload data and immediately see implications.
Uploaded data wouldn't do anyone much good if it didn't have a visual counterpart. Austin, our lead designer and resident musician, meticulously crafted displays that were easy to comprehend. Small details like hover tips and carefully chosen colors help customers orient themselves. Intuitive hierarchy means that customers are drawn to the most important information first. All of these elements are embedded in an easy-to-navigate layout, informed by Shulman.
It used to take 50-60 hours to orient someone to the spreadsheet; now it takes 2-3 hours to train a client in B3i. That’s a 20-25x improvement! Shulman is confident that someone could grasp the basics without any training at all.
Shulman’s model, embedded in an instant and intuitive interface, is the indispensable piece for research universities. The systems that Shulman has developed over a decade allow universities to make data-backed decisions and accurate forecasts. This gives university executives confidence in their daily decisions and security in future planning.
Starting simple: success using an MVP
Starting simple—with a MVP—helped Shulman achieve all three of these goals. Shulman says we helped him see "if you try and do everything from the onset, it's going to cost you an enormous amount and you'll never get finished."
Instead of trying to pack everything into the first release, we focused on developing a product with plenty of room for growth.
Starting small also made it possible to create a polished product. Universities have high standards, so the application couldn’t be riddled with bugs or lacking key administrative features. Overpacking the initial release would’ve either led to a less polished product, or a much longer development timeline.
Introducing B3i: A Business Intelligence Tool
Today, B3i is a robust business intelligence tool that helps research universities make sense of their financial data. It provides a window into current financials, forecasts, and the data that administrators need to make smart decisions on a daily basis.
This equips universities to do a lot of things well, including:
- Allocate current funding
- Bring more data to hiring and promotion discussions
- Set future budgets with confidence
This powerful tool is also useful on multiple levels; deans, department chairs, and individual research investigators can all benefit from it. What’s more, Shulman offers the software at a price that's comparatively cheap. If universities devised, built, and maintained a similar software product in-house, it’d cost the university a fortune.
Results to date
Shulman currently has eight clients, several of which are Ivy League schools. In the higher ed space, that's incredibly fast adoption.
Since the software is scalable, Shulman can continue growing his client base. He was at max capacity between his spreadsheet model and consulting; now he can onboard several new clients a month. This makes the product more profitable and more attractive to acquisitions.
Scalability also means that Shulman can do exactly what he set out to do—change the culture in research universities. When his growth was limited, there were only so many universities he could partner with. Now he can impact as many as are interested; B3i Analytics is in position become the industry standard.
Update: B3i was acquired by a publicly-traded international consulting firm in August 2020. 🎉
7 lessons for aspiring entrepreneurs
After decades in business, Shulman has learned a lot along the way. Here are some of the biggest lessons he shared with us.
1. Use something besides words to build your idea
To get started, Shulman recommends you "develop your idea as something more substantive than words." It's good advice, and it's exactly what he did even before approaching us. It was Shulman's polished and tested prototype that allowed us to build his MVP so quickly. A prototype also helped Shulman build up a small customer base and save a good bit of money; it would've been twice as time-consuming and expensive if we had started from scratch!
2. You can't afford to wear rose-colored glasses
Shulman ran a company for 23 years, then sold it. He's held leadership positions in multiple universities. And now he's a successful entrepreneur. Through these experiences, he's learned that, "business is tough. It takes a lot of stamina, a lot of guts, a lot of motivation." You have to have the stomach to put money on the line and take calculated risks. And you can't afford to ignore things when they go wrong or red flags when they pop up.
If you want to succeed as an entrepreneur, you have to take off your rose-colored glasses.
3. Small solutions may have big implications
To a lot of people out there, Shulman's niche may seem uninteresting. His solution isn't an Uber, Twitter, or TurboTax that millions of people will use. It's a small solution for experts in an unsexy niche. Yet this small solution saves research universities millions of dollars each year. Decisions those universities make with B3i impact hundreds of thousands of people. Shulman notes that if you "do a first-rate job creating a solution to that seemingly small issue or problem, then it can have significant consequences.”
4. Building software? Prepare to be obsessed.
When you hit on a good idea, it's exciting. Shulman recounts waking up with ideas at 1 or 2 am and going to work on them in the small hours of the morning. Honing your idea can become an obsession, and not necessarily in a bad way. Especially early on, prepare to spend a lot of time and energy on what you're building.
5. There's no age limit on success
At 72 years old, Shulman says he's more excited about the work he's doing with B3i than anything else he’s done. He jokes that entrepreneurs should pursue their dreams at a younger age so "you have plenty of time to recoup" if you fail. But we're not so sure. We're encouraged that it's possible to pursue new ideas and dreams at any age!
6. You're more likely to succeed if you can't afford to fail.
If you can afford to fail, Shulman says you'll "avail of that opportunity." He recommends that you commit to, believe in, and act on your idea. Put something (maybe even everything) on the line if you're sure of it. It can be scary, but it's the forcing function you need.
7. Work from your strengths; supplement your weaknesses
Shulman knows he's good at analysis and that he has deep knowledge of the industry he's in. These are great strengths, and they've helped him succeed. As his business grows and changes, though, Shulman knows to supplement his weaknesses. He recommends entrepreneurs identify their limitations and find creative ways to work around them.
Not so fast: a final word on patience
One more lesson we learned from Shulman and his work is this: success takes time. Shulman is a 20-year overnight success. He had over two decades of varied experience before he hit on his idea. Then he refined that idea for another ten years. And those lessons? They've taken a lifetime to learn.
In a world that seems to move faster than ever before, this is important to remember. There are few—if any—shortcuts to building something worthwhile.
Doing something right really can lead to more success than doing something fast.
We’re honored to know Steve Shulman and be a part of the incredible work he's doing. Check out the B3i site for more information about his powerful business intelligence product.