Contact management evolves into CRM for VC firm

Reliable contact information is the key to success for professional services organizations. But the lack of a standardized, automated contact management system can lead to missed business opportunities.

That was the problem partners at Sevin Rosen Funds, a venture capital firm based in Dallas with additional offices in Austin, Texas; Palo Alto, Calif.; and San Diego, were facing until last year.

"Things came to a head in early 2001 when we realized that everyone was using a different contact management system," says project manager Greg Beltzer. "Some offices used Excel spreadsheets, while some used a shared Microsoft Outlook folder." The Dallas office used four different databases. To complicate matters, each partner managed his or her own Outlook databases.

In March 2001, a team of partners decided to automate the company's unwieldy contact management system by implementing Interface Software's InterAction for both contact management and relationship management. Sevin Rosen believed InterAction would work well in its environment because the product is geared toward the professional services market. The only customization needed, Beltzer says, was renaming fields and headings to match the company's naming conventions.

Partners now can enter, change, and access contact information through a desktop or notebook computer or, if they're on the road, through a wireless BlackBerry or Palm handheld device. And because the system is integrated with Microsoft Word and Excel, mail merges with accurate contact information have become much easier, Beltzer notes.

The system also exchanges information with Investran, accounting and portfolio management software from Financial Technologies, which keeps track of investments made by limited partners in various funds. "We make information available to InterAction so everybody can use it and see it, although they can't touch the accounting part," Beltzer explains. "If you change contact information in InterAction, Investran will pick that up. Everything is centered in InterAction and is disseminated to all of our other areas--not only accounting, but marketing, operations, and our partners."

Although everything is running smoothly now, it was a bumpy road at first. Beltzer helped install the system on a Dell PowerEdge 2550 server running Windows 2000 in Sevin Rosen's Dallas headquarters. The software installed easily out of the box, but the firm's partners were reluctant to give up their Outlook databases, which were commonly used throughout the company.

"Initially, we had a problem with partners buying into the contact management idea because it forced them to enter and manage contacts differently from the way most of them had been doing it," he says. "We soon realized that our decision not to allow partners to use their old contact database wouldn't work." To solve that problem, Beltzer reworked the system so it would look identical to the previous method of input and access through Outlook. By doing so, partners could enter and retrieve contact information the same way they always had, with the information transparently massaged into InterAction.

Once the system was working well, partners began asking Beltzer if the system could perform more advanced tasks, such as learning about past connections other partners may have had with a potential client, so they could use that information to help achieve their goals. It was those types of requests, Beltzer says, that led to better use of InterAction's relationship management features.

"If you've got an entrepreneur who gives a proposal on his company, a partner can check the database and perhaps find out that another partner already met that person at a conference," he says. "That way, the partner already has a heads-up on who they are and what the other partner thinks about them."

So far, the system has worked without a hitch, saving the company money and improving efficiency and productivity. "We have about 20 marketing events each year that involve the portfolio companies. Before, an admin would have to contact various partners and wait for responses," Beltzer says. "Now, we have folders set up for each company where the admin can check off names and spit out labels. It saves tremendous time, and we aren't leaving people out by accident. Before, it was a day's process, but now the admin can do everything in 15 minutes."

Beltzer says the experience has been valuable, and he's learned an important lesson he plans to apply to subsequent software implementations: "Get input from multiple sources in the company. You have the salesperson's input and the input of the lead cheerleader in the firm, but you need to hear from marketing, operations, administration, accounting, and the partners," he says. "That could have circumvented some of the problems we had, like getting partner buy-in and making sure everyone in the company was on board."

What software or procedures has your enterprise used to successfully manage its contacts and relationships? TalkBack below.