Scott Dorsey TMP '99

Inroads to the inbox

With robust tools, TMP alum cuts through the clutter to deliver brand-enhancing communications that get results for ExactTarget's users

By Kari Richardson

When Scott Dorsey TMP '99 donned his gown for his Kellogg School graduation seven years ago, the Internet bubble was sailing high. In fact the new grad's first job was a yearlong stint with the now-defunct dot-com holding company Divine interVentures.

A year later when Dorsey launched his own business — a permission-based e-mail marketing software firm called ExactTarget — the bubble was little more than a puddle of suds. As one Internet firm after another went bust, venture capital was becoming scarce, a fact for which the alum says he is now grateful.

"We really bootstrapped the company and that's one of the things I'm most proud of," says Dorsey, a graduate of The Managers' Program, the Kellogg School's part-time MBA offering. To launch the venture he used personal savings and $200,000 from family and friends. "We were kind of the anti-dot-com. We worked without salaries for months and shared hotel rooms when we hit the road. In our early days, we were very frugal."

To this day, visitors won't find free massages and foosball tables at the Indianapolis offices of ExactTarget. What they will find is a company with some 200 employees, 5,000 customers and more than $25 million in sales in 2005. Dorsey says the firm, which recently snagged the No. 56 spot on the Inc. 500, a list of the nation's fastest-growing private companies, is committed to helping companies revolutionize their e-mail marketing programs.

The most sophisticated users of ExactTarget's e-mail marketing software utilize the product to integrate sales and customer data, sending electronic messages tailored to the recipient's interests. An online shopper who recently browsed through a retailer's sweater inventory, for instance, might receive a message luring him back to complete the purchase — perhaps by offering a discount.

One real-life client, Hotels.com, uses ExactTarget's software to send a message to anyone who books a hotel room on its site. In addition to a confirmation number, the message provides a weather forecast for the booking location and information about local tourist attractions. Dorsey notes that all marketing communications are permission-based, not spam, meaning customers have OK'd them.

In founding the company, Dorsey joined Peter McCormick, a colleague from his days at Divine interVentures, and Chris Baggott, his brother-in-law, who began in the database marketing arena with RR Donnelly's catalog business before acquiring several drycleaners. At family holidays, Dorsey and Baggott would chat about how Baggott's drycleaning business was growing thanks, in large part, to his self-created e-mail newsletters featuring fabric care advice, coupons and anecdotes.

The newsletters were "wildly successful but difficult to execute," Dorsey says. "Not every small business owner was going to have the skills to do it." The trio began ExactTarget with the goal of helping small retailers and local businesses to build customer relationships through the electronic medium, just as Baggott had.

Competitors at the time were producing software with many of the same functions, Dorsey says, but it was complicated to use and too costly for small businesses. Today ExactTarget customers still manage the software themselves, but the client list has grown to include giants such as Anthem Blue Cross and Blue Shield, The Home Depot and CareerBuilder.com.

To all comes a warning: Proceed carefully. E-mail messages may be cheap and easy to send, but if mishandled they can quickly become tedious to recipients, resulting in damage to a company's brand. "Some of the best marketers in the world are poor Internet marketers," says Dorsey. "We actually work with people to send fewer e-mail messages that are more relevant and deliver a better return."

At company headquarters, Dorsey and his team still honor the can-do spirit that launched the company – traits honed during his Kellogg days.

"I attended the Kellogg School during an incredible time," he says. "Kellogg very quickly built a curriculum around the Internet. The school was very agile and entrepreneurial itself."

He adds: "I'm a textbook case for what the Kellogg School can do. It provided experiences and education that changed my direction and my life."