035: How to Manage Your Virtual Staff, Pay Them, and Understand their Productivity Levels (w/ Dave Nevogt)

Summary: Dave Nevogt is the co-founder of hubstaff.com which helps businesses easily manage virtual and remote teams through SaaS time tracking, project management, and employee development. <br> <br> He has founded several multi-million dollar internet businesses since the he was 22, and has been working on them since 2003. His start was in online golf instruction in 2003 which he grew to $1.5Million by 2005. He sold those businesses in 2009, and then purchased and ran a larger search engine optimization software company that focused on link building. <br> <br> While building and managing these companies he’s managed over 100 virtual employees/contractors concurrently. He also writes a popular blog series that teaches what his team has done to grow Hubstaff to where it is today. <br> <br> Current Revenue streams <br> <br> Hubstaff has been generating enough money to pay out the founders, pay employees’ salaries and sustain operations but it doesn’t have one sole revenue stream. The business is currently generating $6 Million in annual revenues from selling its software through a SaaS subscription model. <br> <br> Starting out in business <br> <br> Worked for 18 months in a large pharmaceutical company in Chicago. After that he only worked on his own businesses. His first business was a golf instruction e-commerce platform which taught people how to swing a golf club better through videos, eBooks and training aids. Within a year, the business was generating $1.5 Million in revenues and had customers globally. The business taught him his first skills in running an online business. <br> <br> Scaling up the first business quickly <br> <br> Dave believes it was a right place, right time scenario because he picked the right business and the right market. The business was very unique because there were only a few people doing what he was doing. The business’s quick growth was made possible by the high conversion rates the site was getting because he was using very cheap and unsaturated advertising channels like email marketing. Dave then sold off half of the business. <br> <br> Transition to the next business  <br> <br> In the course of selling his business, Dave met one buyer in particular who used to buy underperforming ecommerce businesses, turn them around and sell them for a profit. Dave and the buyer bought a software related company together. With Dave managing its operations, the business started generating $2 Million in revenues from selling content. That gave him hands-on experience in running a software related company. They eventually sold off the business. <br> <br> He also started Hubstaff while still running the software company. He currently runs the marketing and operations side of Hubstaff while his partner runs the technical (development) side of the company with each of them working with a team of 10 and 12 employees respectively. <br> <br> The Hubstaff idea <br> <br> While running the golf business, Dave was in dire need of software that would help him manage his technical staff since he had no technical knowledge and therefore needed to make sure he was effectively tracking their performance to ensure projects were being done on time and in the expected way. <br> <br> That need gave Dave the initial idea of developing Hubstaff. He was also inspired by the need to develop a product that would give value to people, that they would use every day in their businesses. Hubstaff uses time tracking to enable business owners manage their virtual and remote employees by ensuring they are doing what they are expected to do at the right time. The software also acts like an activity tool. <br> <br> Once he came up with the idea for Hubstaff, Dave looked for a local co-founder. They both invested $26,000 each into the start-up and started the development of the first applications which cost about $40,000.