I bumped into Mikko Nurminen a few years ago and was immediately fascinated with their business. He's one of the co-founders of Ideakone and they own products such as Kotisivukone and Moogo as they're known in English. They're in the business of easing website development through modular plug and play features. We've recently written about one of their Estonian competitors Edicy and since there seems to be a lot of well developed business here, I thought of getting back in touch with Mikko and interview him on where they stand today.
To my surprise, they're doing extremely well. I knew that they're big in Finland, as I had seen their advertisements in many places. However, the depth of their success did surprise me. Ideakone's turnover this year is expected to be between 1,3 and 1,4 million euros. Last year it was 932 000 euros. Furthermore, according to Mikko they had financial challenges during their first year as they put in a lot of time and effort into developing the service and revenues started rolling in during 2006. Thus they've been pretty profitable from the second year onwards.
To go back to square one, Mikko had been thinking about creating website development smarter for the large majority of people out there. At the same time, his friend from all the way back in upper school, Antti Ala-Ilkka had similar ideas since they were both involved in small scale website projects and knew the amount of repetitive work that had to be put in. Starting their business in 2005 was a clear way through as they both had entrepreneurial experience all the way from the turn of the millenium.
Naturally, building a company this fast and successful is not easy. I asked Mikko about the challenges in doing this and he mentioned that while financing was not a challenge, despite the first year, they did see recruiting as one of the largest obstacles they needed to overcome. They have had difficulty in finding java developers and thus slowing down their R&D efforts. Current and future challenges include internationalisation, but in a fun and interesting way according to Mikko.
So what makes their service so powerful and attractive? Simplicity and a very scalable business model. According to Mikko their target audience is the tech averse population in general. For these, simple use and ease of adoption are key elements - also for the success of Ideakone. Their business is built on automated processes and scalable server resources from Amazon S3.
With the help of Moogo and Kotisivukone, over 200 000 homepages have been built. Half of this is from Finland and the other half overseas. Despite this, most of the euros roll in from Finland. They recently hired three new people to work on Moogo solely and their task includes new language versions and the development of overseas operations.
I asked Mikko which countries are the most notable ones at this point. "While the English speaking countries like UK are always interesting, other countries have shown interesting growth as well", he replied. According to Mikko Brasil has shown some strong growth recently and this has lead them to look at Spanish and Portuguese speaking nations more closely. Russia, Poland and other Eastern European countries are also interesting, but they haven't put in too much research on those yet.
It seems that building SaaS-model businesses is a huge hit these days and a very profitable approach as well. Moogo has three different price groups for users with different needs. There's always the free user alternative, but the commercial versions are priced at $4.99 US and $14.99 a month depending on your needs. I had a quick look through the comparison chart and to me they seem very fairly priced with a lot of good value bundled into the packages. With prices like these Ideakone has thousands of paying customers, which very much confirms their value prop for the consumers.
I'm honestly very happy to see companies like Ideakone flourish and grow in a very healthy manner. Also, if you think about it - the solution isn't rocket science, it's just a lot of thought being put into constant improvement through a very simple service.
I wouldn't be surprised if these guys are one of the brighest stars to come out from the Finnish startup scene in a few years time.