Conversations With Larry Blankenship, CEO and founder of Digital Dog Inc.

So what has guided you in developing web sites? After building well over 400 of them, you must have some clarity of vision that has guided you and your team?

What might surprise you is that even in 2004, my vision continues to evolve and reflect the changes that we see when working with clients. Think about it. The medium (Internet) keeps changing, our tools and technology keep changing, and of course the site visitor and the type of client we have keep changing. That means what might have worked a year ago might not be the best solution today. We owe it to our clients to understand how each new technology fits into the solution. We're truly technology activists.

Of course, there are a few things that haven't changed since I hired our very first person: First, always do great work and never worry about the money. Second, remember that good web sites at their core are always about good communication--not technology. Finally, find, hire and empower the best people you can find and then make sure they are challenged and share your passion and vision for creating a good client experience. We’re lucky on that last; we’ve got a great team of very talented Internet professionals.

Digital Dog was one of the first web development companies in Nashville. What was it like developing sites back in 1994?

Actually, we launched in the summer of 1994 as a classic marketing firm that immediately started getting involved with the Internet. We built our first site in the fall of 1994. Boy, was it ugly (laughs). In 1992 I had personally begun to use the Internet daily, hopping on services like Prodigy and CompuServe. They were woefully boring looking back now, but they brought people together in what we now know were the first online communities to chat and converse about nearly anything. It wasn't so much about e-commerce back then, it was about digital conversations, wasn't it?

I have to tell you honestly that back in 1994 none of us really knew what we were doing. I think I did my first website for $175 and built it using a little HTML editing program called HotDog. Back then, just about anything you added to a site on top of static text made it look better. Putting a background color other than gray really got you on the cutting edge back then (laughs). Adding images was actually somewhat controversial; some tried to make you feel like you were a part of the "commercialization" of the web, if you can imagine that attitude. Some of us began to realize that the Internet was a medium that was going to change how we all communicate, both on a personal level and a commercial level. But back then, we really did "surf" the web, whereas today, most get on with a mission in mind, to find a product or service, do research, or to send or receive information.

I've heard that you've built your business on a somewhat different model than most businesses?

A lot of venture capitalists that we've worked with the last couple of years have told me that they've marveled at our business model as we've often had a backlog of work, even occasionally turning down projects due to time constraints. Now that set of facts isn't that extraordinary I guess. What is, is that we've never had a sales rep. Never had a brochure, don't hardly advertise and honestly we've really never even had to pick up the phone for business for the last five years. I hope all of this doesn't sound smug. It isn't; it's just the result of having a vision about working differently. Always putting great work in front of squeezing one more dollar out of a project like so many of the technology firms that used to do in this market. We honestly don't know why some of the firms charge $100,000 for a project that a shop should be able to do for a third of that. But again, that’s probably why a lot of shops closed their doors—like the Nashville-based Weberize and so many of the others just like them. They just didn’t understand our business and how important the client relationship experience is. If they did, they’d still be in business, right? I heard one estimate that 80% of the firms that were doing web development in middle Tennessee just two years ago are now out of business. I’ll tell you that we’ve never worried about making a profit—good long-term relationships almost guarantee that you'll make a profit.

How do you work with clients needing web development?

Boy, that's a big one. In a way, we actually turn the tables on them and assess not only what the client hopes to get from their web site in terms of goals and results, but also what kind of process might fit them best to make it easier for them to be an active participant. Are they technically savvy? Or are they more marketing driven? After developing over 400 web sites, we've learned that each client is different, each with its own vision, needs and goals.

What a lot of webdev firms don't understand is the bigger problem: how do you help a client who might be fairly new at developing their company's Internet strategy? We've learned that good web sites--whether they be consumer portals or classic B-to-Bs--are absolutely, positively about good communication. It is not about technology; it's about people. People needing goods, services, data, information, and solutions. Technology is simply the tool to improve and fine-tune a site's communication, usability and functionality.

Larger, more experienced shops like ours get it I think, but we've learned from taking over numerous projects from smaller local shops that it can be difficult for some firms to still grasp and focus on these key points. One concern is that clients still often key in on small design elements, icons, slight color shifts, when all of us would really like them to focus more on the big picture. But, again, a client is a living, breathing entity and we try to wrap our process and services around their needs, around their goals and help them build their vision of their Internet presence. It is challenging because as a project develops, our team-driven process means that our clients get smarter, start grasping the technology more, and begin seeing the limitations and value of HTML; as they learn more, they are able to make decisions about their project that they might not have felt comfortable with in the early stages of the project.

We really like smart clients. Smart clients just fit us better. For me, the old adage that knowledge is power is never truer than in the web development process with a client. We make a point of using part of our development time to help new clients adapt their decision making process to reflect the inherent advantages to communicating with clients and customers via the dot com space. Things like the medium's speed, the pace of innovation, the inherent flexibility of a good site to react to market conditions--all provide opportunities to help us help our clients build better sites. We try to arm them with the knowledge and strategies that help them leverage their current firm's strengths onto the Internet by crafting e-strategies that fit not only who they are now, but also where they're going in the future. All clients know now that the Internet is a part of how they do business. The mainstream press has taken care of that, haven't they? The need to have their message and products on the Internet everywhere, in their trade magazines, discussed in internal meetings, heard in seminars they attend--the message is everywhere.

A number of Nashville-based web development companies have closed their doors in the last year haven't they?

Yes, certainly having our biggest competitor Weberize close their doors changed our market here. We were sad to see them go, but obviously, it's a changing economy and they just could no longer compete effectively and I think they lost their vision. A number of smaller companies have also faltered in what is a changing business environment for those running a webdev company. For us it's an opportunity to continue our march towards providing a wide range of web development and e-services in this, and other markets. I have always felt that we were the smartest, most experienced web development company in the region--which we clearly are when you look at our body of work and number of successful websites we've developed over the last nine years.

Over the last few years, we've learned that clients value our pure focus on web development, and if you look at some of the failures and miscues of other local firms here, it's clear that it was also a good business decision for us. We do more Internet projects and have more web development clients than anyone in the U.S. today. Our talented team of Internet-savvy professionals gives us great depth, since we concentrate only on the Internet piece, not traditional graphic design, or pitching computer networks, or hawking hardware, like so many firms do to try to generate more revenue. Why you'd hire your cabling guys or network people to help you develop your future e-strategy or define complex online branding issues has always been a mystery to me--they're all completely different businesses now, requiring different skill sets and knowledge bases. The fact that they all involve computers is so irrelevant that we're surprised people still can connect the dots to that one.

These days we focus more on the technology that empowers clients to manage their own content, their own data, even their own images. That's the next generation of websites in my vision. One that enables the client to have the flexibility to modify and update their own site through content management systems like our own SiteDoc. Much of our development time these days is working in this area and it’s an exciting time for us.

So, your firm's experience - is that the one clear thing that sets Digital Dog apart?

Increasingly, in the Internet space, smart clients have learned that you can't underestimate the value of working with a company that brings to the table years of real-world strategic Internet development experience. Clients tell us that is one of our key competitive advantages. I like the fact that we have really smart people on board; they've spent a lot of time in the trenches with clients. You can't match that kind of experience, and clients recognize that.

Another issue is that many firms that develop and manage websites have closed their doors, leaving clients high and dry. We've been in the website development and management business longer than anyone in our region, and it's increasingly important to our clients that we're going to be here now and in the future.

Another is that we are well known for doing nearly all of our work in-house. That in-house part is important because many companies still don't have the wide range of skill sets and experienced people that is now required for building most business to business websites. Many still outsource the more complex work--we know this for a fact because over the years, we've been the ones they've called in on those projects, more often than not.

We've been through clients' growing pains. We've heard how hard it is--and continues to be--to find qualified firms here for webdev that don't cost an arm and a leg--or are so young that they all look like your kid brother when he just out of high school (laughs). Pretty much every component and skill set that goes into building an Internet project is one we've been doing for years. Don't forget, we've been in the Net trenches since '94, and that experience, that huge knowledge base of real world building really helps us understand the trends, the movement in the technology, in ways that a firm just getting started can't even begin to fathom--you can read all the issues of internet/business magazines you want, but nothing is better than real world experience. No one in Nashville can match our experience--though we let everyone here at Digital Dog know that we all have to keep pedaling hard if we want to continue to lead in this market, though personally, I like all these newbies in town, keeps us on our toes.

Where is Digital Dog heading as you look down the road?

The better question, really, is where are our clients taking us? Anyone who knows me, or who has heard me speak, knows that one of my favorite sayings is that "Your clients always tell you what business you should be in; you just have to listen." In early 1997 we started working with a new breed of Internet business person--they weren't just launching websites, but were wanting to build full-scale Internet businesses. That required us to add a lot of new pieces to our services. We've worked hard at understanding and developing e-strategy, e-branding, and concepts like permission marketing for our clients--even back then. This was an amazing time--just at the beginning of the era of easy accessibility to venture capital and the dawning of the fast and furious IPO era that has now matured. It was exhilarating and exciting and we really were blazing new trails back in the mid-90s. I guess you could say after helping launch dozens of Internet businesses that we were really Nashville's first Internet incubator, though we've always been lower key about it in the press. In fact, we're proud of the fact that no one in the region has helped build more Internet startups than Digital Dog. By being in the trenches with a number of them month after month, we've learned so much about what it takes not only from the strategic side but also from the internal side--things like infrastructure requirements. Again, it's about real world experiences, isn't it?

It sounds like you have come a long way since you began in 1994?

You have to understand that I started in a one room office nine years ago--I laugh now thinking back about it, each wall had a different color wall paneling. I was in a building that was probably not in the best part of town--but it was all I could afford at the time as a startup. But we all have to start somewhere, don't we? I'm proud that I came from there to where we are today--when I started I didn't have any local business connections, nor really much money, just a willingness to work hard and a real passion for focusing on the client experience. I just knew that I could build Nashville's most successful Internet agency--never doubted it for a moment, even during the tough times. And we did it—we were particularly proud when we were selected as one of Nashville's fastest growing businesses--the Future 50.

All the venture capital in this town couldn't bring us to where we are today. Money doesn't buy passion or the desire to do great work. We're a team of people who have a real passion for doing world-class work. Our mantra is to build long-term relationships with every client we work for--large or small.

But let me also say that one of the reasons I do this is that my job is really great fun, too. We've been fortunate to have so many wonderful clients who have let us, encouraged us, to do really great work. As Internet webdev pioneers in Nashville, all I can say is that we're committed to not just continued growth for our shareholders, but doing great work as long as it says Digital Dog on the doors. Personally, I wouldn't know how to do it any other way.