Starting Appian without a concept, a plan or a customer

August 7, 2011

At age 26, Matthew W. Calkins walked away from a five-year career at MicroStrategy without a business concept, without a plan and without any customers.

“I was overconfident,” he said. “I did it without even blinking.”

The Dartmouth College graduate, who had won the school’s prize for top graduate in economics, had rotated through a range of departments and roles at the Tysons Corner software company. Grateful for the learning experience, he didn’t want to damage his relationships there.

“At the time, I thought it would be inappropriate of me to have even planned my business prior to departing,” he said.

Like many young entrepreneurs, he dove headlong into launching his own business, fulfilling a childhood dream. But unlike many others, Calkins eventually came to embrace a business traditionally regarded as equal parts boring and daunting; he wound up a government contractor.

That isn’t where he thought he was headed. After departing MicroStrategy in 1999, Calkins, now president, chief executive and chairman of Reston-based Appian, sat down with friends to figure out what his business should be. The group settled on personalization, a concept that uses technology to customize recommendations — like books or movies — for individuals.

The company quickly attracted customers and added employees, reaching about 30 within a year. But the dot-com bubble burst, halting the company’s growth.

“Personalization had never really come to fruition,” Calkins said, adding that customers, including a company that wanted to offer recommendations by installing kiosks in video rental stores, weren’t paying their bills. “We had to retrench.”

Appian leaders reinvented the company as a business process management firm, focused on helping companies and agencies better organize and manage their work.

Lacking a big budget for marketing and sales, the company targeted high-end companies that wanted personalized products. It was quickly able to sign three major deals and used the revenue to expand its targets and standardize its product.

In 2001, the company won a major contract with the Army to build the infrastructure for its main internal website. The deal ended up being one of Appian’s most successful.

Today, just under half of the company’s business is with government organizations; the rest is with commercial firms.

In the government sector, investors tend to look for older entrepreneurs, those who have accumulated some connections and experience with the government buying process, said Bobbie Kilberg, president and chief executive of the Northern Virginia Technology Council.

“If someone’s been around the block once ... they have a track record,” she added.

Calkins said he remains hands-on; he has interviewed every hire at Appian since the company’s founding. Appian now has just under 200 employees.

Though he now recognizes that the way he founded the company might have been rash, Calkins said there were advantages to being young and underfunded.

“You don’t take too seriously what anybody else has done, and you have a fresh perspective on the problem,” he said.

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