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challenge revisited

Viafoura co-founder and chief executive officer Jesse MoeinifarCaylee Alzner

How have companies fared since appearing as subjects of our weekly The Challenge series? From time to time, we will follow up to see what's happened since the experts weighed in with advice on the challenges they presented.

In late 2011, the founders of Toronto-based software-as-a-service company Viafoura Inc. had a potential deal with a lucrative client, a large media company that was interested in hiring them for a project.

But the client wanted something different than what was on offer.

How could Viafoura land that big opportunity on terms it felt comfortable with, or decide whether to walk away from it completely? That was the dilemma the company posed to The Challenge experts.

Viafoura is a social monetization and analytics platform for large digital publishers. Its plug-ins – including social login, video commenting, content discovery and gamification features – help a website's users interact more with the content and other users on the site and allow the publisher to mine rich user data.

But Viafoura's potential client wanted to cherry-pick only a custom video-commenting feature (which allows users to record, preview and upload short videos of themselves to add to a comment thread), not the full suite of plug-ins that Viafoura usually provides.

"We didn't understand why they just wanted this one piece when there was a whole tool set available to them," says co-founder and chief executive officer Jesse Moeinifar.

Viafoura was hesitant to take on the project – it knew that providing the client with only one piece of the tool set would require a great deal of customization and, therefore, more resources, Mr. Moeinifar says.

Plus, the company was concerned it might not return the accurate user data it could normally count on from the full tool set.

"We're not a custom development shop, we are an SAS company," Mr. Moeinifar explains. "We're happy to work with our clients to make sure we're developing something that they need on top of what the base functionality is. But in this case, it was something very different… there was a huge degree of variance. So that's what made it a hard decision for us."

So what did Viafoura decide? In the end, it opted to take on the project, says Mr. Moeinifar – but not before getting the potential client's decision-makers together at a table for a long meeting, to ensure everyone knew exactly what they were signing on for.

Honesty with the client was one piece of advice the experts delivered to Viafoura. Another was to really weigh the customer's request more carefully.

So Viafoura did just that.

"I think, first and foremost, you need to really understand what the client is asking for and why they are asking for it," Mr. Moeinifar says. "I think that was a challenge we had in the beginning: There were a lot of people on the other side, we were getting mixed messages.

"But after spending a lot of time with them, we clearly understood [what they were looking for]," he says . "They just wanted to see if there was going to be an uptick with their existing users around this functionality."

At the same time, Viafoura stated its reasoning behind being hesitant to implement just one plug-in.

"We pretty much let them know that we're willing to deploy this the way you want it, but at the same time you have to be completely cognizant of the fact that you might not get what you're looking for because of x, y and z."

The Globe's panel also advised Viafoura to change the payment structure to account for the extra time and manpower involved. Mr. Moeinifar says his firm was very clear on that issue.

"We went in there and said, 'What you're asking us to do is very different from what we typically do, so you have to be ready to pay for it,' which they said they were," he recalls. "We weren't ready to necessarily walk away from the deal, but we knew, given the resources that we had at that time, that we needed to be compensated for it."

To ensure the company would get the best results possible, Viafoura suggested modifications to the plug-in the company wanted, which were accepted. The outcome was overwhelmingly positive, Mr. Moeinifar says.

"The results ended up being absolutely stellar, so now we're negotiating a much larger deal. Now we're talking about doing a full deployment," he says.

And because the company is such a "big name," says Mr. Moeinifar, Viafoura has earned a lot of goodwill from being able to reference it when talking to other major players.

In fact, the client has produced a half-dozen referrals, he says, one of which has already become a new customer. Viafoura is in "ongoing discussions" with the others, and Mr. Moeinifar says he expects most of them to become clients over the next two to four months.

"Since the [Challenge], we've pretty much doubled the size of the company," says Mr. Moeinifar, going from 13 to 30 employees. "Revenues have tripled, so we're in growth mode and excited about the future of the company."

Despite the fact that things turned out well in this instance, Mr. Moeinifar says Viafoura doesn't plan to "go down that road again."

"The company was still very early on in its life cycle, so you sort of have to be very mindful of what the market is requesting in comparison to what we think the market needs," he says. "We definitely are aware of that, but, at the same time, this was a very unique case."

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