In the past few years even the biggest and most traditional organizations have taken steps to modernize their services. In the banking business, E-invoicing is here to stay due to the worldwide incentives to get this working. In the For example in Denmark, Tradeshift has seen a lot of traction with their model. The situation in Finland is slightly different due to the numerous operators offering solutions in this area. One of them is Maventa.
We've covered Maventa in the past as well, back in 2010. Back then we called them the rebel e-invoicing provider and it seems the rebels are taking over "the universe".
The company has seen very god growth in the past years. Here are some interesting figures regarding their business:
Turnover (monthly run rate): 115 000 €
EBITDA: around 35%
Clients: around 10 000
Countries clients come from: around 30
Turnover of largest client: about 3.3 billion euros
Amount of money handled each month: 600 million euros, which translates to 1.8 billion a quarter.
We of course couldn't stop ourselves from getting in touch with Kim Forsman, the founder and CEO of the company to interview him on the development of the business. This is a pretty long story compared to our regular short ones, but it's very much worth it. Forsman shares a ton of advice in building a fast growing company in a traditional industry like financing.
ArcticStartup: Can you share how Maventa got started and what was the goal of the company when you started off?
Kim Forsman, CEO, Maventa: The idea behind Maventa started to take shape in 2006 when I was doing process consulting for larger enterprises in my past startup. By coming across these enormous, stale and utterly expensive ERP/Workflow systems of our clients I started to plan how to tie in our own billing process to these large buyers. Basically our company’s own need triggered the interest to e-invoicing at a larger scale. In 2007 we set out to enable any company in the world to send invoices to another free of charge – which became the strum line of Maventa.
AS: How has that goal/vision changed over the years?
KF: I don’t think that the goal or the vision changed at all but everything else seemed to be constantly a moving target.
I think we tried three or four different go-to-market models ranging from system sales to purely viral approaches and it just didn’t seem to catch other than headwind. While the technology was still being developed (2008) I spent a tremendous amount of time to understand the customer problem, market dynamics and being out in the field to understand what was being offered and for what price.
By imagining ourselves in the supply/demand sweet-spot we finally figured out the best way to sell this black-box of ours and incentivizing all the parties involved. It took a few bends, turns and even some handbrake-turns to get there but once that model is solid enough it all boils down to execution.
AS: Let's talk business, you've managed to build a good business in Finland where the sector you work in is controlled quite heavily by existing (and old) players. In short, how did you do it?
KF: In short, I should probably write book on this. Getting into an ecosystem that is protected by publicly listed companies, banks and large stakeholders is far from trivial. The level of protectionism is reminiscent of the cold-war era. There was always an excuse to exclude Maventa from partnerships; balance sheet, age of the company, legal obstacles, lack of references and an endless list of issues alike. I seemed hopeless to even get a response by email from some of these players, others just blatantly told us to stop pestering them. We didn’t.
The business we are in is a trust-based business. We took a decision to leverage and rely on the trust we had accumulated so far from our existing customer-base and to use that as a tool. Every time we hit an obstacle that seemed insurmountable, we reported that back to our customers. Short, timely messages about what we were trying to achieve on their behalf started to pour out. When a hiccup or obstacle was hit, our customers took matters literally (and often personally) in their own hands and started to bombard the troublesome party to lift an embargo or solve an issue.
By leveraging a customer-base of 300 active customers back then surely did clog up a few call-centers and helpdesks. Our customers fought relentlessly side-by-side in achieving our vision and that’s probably how we got the name “rebel” attached to us in the first place. Instead of being seen as a team-size of 4 we suddenly appeared to swarm all over the place. One by one the insurmountable problems started to crack. This was definitely the turning point the allowed us to grow our root into the ecosystem at large.
AS: So customers were a key part of the go to market strategy and expansion of business. How did they help you in developing the product?
KF: The customer is after all the most valuable asset you probably have. You can build superfluous technologies, imagine billions in income through business plans and even raise loads of money to back your ideas without having a single customer - but what either breaks the bank or the company is ability to source, secure and retain customers – better yet - happy customers. They’re the lifelines of any company.
We involved our customers as a sounding board from the very early days. They were almost like advisers to us. Many of these every-day users from the field had tons of more information than we had and that allowed us to work as aggregators upon that knowledge. Then by making some adjustments and compromises we ended up with solutions that were suitable for most of our clientele – that’s all you need basically. Adding even as little as a euro more value for your clients per month has a huge effect on your top- and bottom-line if your dealing with lots of customers.
It may seem odd to let your customers decide, vote and be so operatively close to the company but for us it has worked tremendously well. This naturally keeps us on the knife-edge as well, because if we do not live up to the expectations our customers will vote with their feet and find someone else who will.
AS: Where is Maventa currently in terms of finances and how does 2012 look for you?
KF: We’ve experienced a revenue growth of a break-neck 13,125% since 2008 when Maventa rolled out its technology to the general public. Managing that amplitude of growth without going lean on finances has neither been trivial. As our business model is purely built on transactional revenues, churn management becomes vital. As the revenue per transaction is a roughly a quarter of a euro, you really need to maintain a throughput of a few of these in order to be considered a business.
Our operations are now cash flow positive and we’ve managed to gather an amazing team of talents to pursue faster expansion, further automation, lesser cost and even larger dreams that I’m not able to comment more on at this stage. 2012 will be more about team achievements and not as much about individual accomplishments. The scaling of operations is so much more than how many people you employ and how much you have capability to invest. We want to create an atmosphere where people can perform at their best, share the same goal and continue to be nimble innovative forerunners.
AS: Any final tips for other entrepreneurs out there from your experience in building your company?
KF: Each startup is so different by nature that making global assumptions on success or failure factors would just seem unjustified. I’ve used two simple guidelines every time I set up something new; determination and agility.
Maventa has been outright the most difficult of my five startups to ignite so far. There was so much sucker punching, obstacles and hurdles alongside the bootstrapping phase that I’m surprised that we got through the three first years without the team falling apart. That being said I never felt liking giving up even if at times we were completely exhausted and drained.
The agility becomes crucial when determination alone won’t suffice. Battering your head against a concrete wall just becomes silly at some point. You need stay vigilant at the helm at all times and make corrections quickly to clear problems. The goal is still there but you may, and most likely will, make a few detours on your way there.
I’ve found that the best way for me is to set a goal even if it seems unnaturally ambitious when setting it. Get support for that goal from your advisers, board and most importantly your team. Stay true to the goal and give it your best. Don’t give up and clear the any obstacles one by one – it’s worthwhile.