The Revenant (Part 2/5)

Growth and expansion

In 2005, we began carrying out elearning content development projects. We already had previous experience developing these kind of projects, from my time with Arthur Andersen, as well as with Overlap Consulting.

The results were:

·     More attractive projects. We were always excellent with the user interface design.

·     More controlled projects.

·     Happier clients, who also commissioned more projects from us.

·     Prices similar to those of the taylor made software.

·     Positioning in the market.

We developed a LMS we named Invenioo, based on an open source platform called ATUTOR LMS https://www.atutor.ca/. I remember designing the webpage myself in my room at the Montgomery Hotel (https://www.eurostarsmontgomery.com/) on my weekends in Brussels. My wife Marta https://is.linkedin.com/in/marta-delgado-echevarría-10b5951 was there for three months participating in a company merger (Procter and Gamble was buying Gillette) and I was going to see her every Friday, but in the end, I only saw her at dinner, since she also worked Saturdays and Sundays.

We began selling Invenioo to clients like Nh Hotels, Aviva, Niscayah, Direct Line, and others. The platform worked, although I also remember one tragic day when an insurance sector client’s users accessed the system and got the look and feel of a competitor L

Our eLearning Factory was located in Uruguay. We manufactured everything from there. This meant a competitive advantage due to the costs, but Uruguay became a world power in software development and this edge faded over the years. It definitely wasn’t a sustainable advantage.

Raccoon was growing and there was a turning point, when in 2008, we sold a large elearning content project (more than 700.000 euros) to a multinational company. That not only gave us peace of mind, but also great experience in the development of multi-language projects and the ability to invest. This wasn’t easy in the least, I can assure you.

The next big steps we took and which were key to the future of the company were:

• The creation of the Betrained system. Our vision was to create an attractive LMS tool with a collaborative 2.0 approach, more similar to YouTube than to business software. My dream was to be able to sell it globally as a SaaS product with a freemium model.
• The opening of our Mexico office with a partner, for which we hired a business developer from the company Meta 4.
• The hiring of a sales manager in Madrid, also from Meta 4, who besides brought his team of collaborators.
• A 500,000 € investment round with the objective of going global and growing Betrained.

In 2012, we reached our peak with offices and clients in Madrid, Barcelona, Mexico, Bogotá, and Montevideo. In terms of billing, we were more or less on par with our main competitors (2,5 million euros, although with very little profit; see the section “Lessons Learned”) but with excellent brand positioning. We had everything we needed to grow.

Raccoon Learning Afterwork Gathering in the Ramses Room in Madrid

The perfect storm 2013

But the seeds of our failure were planted before 2010. What happened to the initiatives we mentioned above?

• Betrained reached its limit of 30 big clients (Nissan, IKEA, NH Hotels, Philip Morris, Colpatria, Nestle, etc.) and based on this began to drop. We weren’t capable of stabilizing the software to achieve increasing the number of clients and making the product sustainable in the face of our competitors’ progress locally as well as internationally. Those competitors passed us on all sides.
• In the Latin American offices, everything that could happen, did: at Mexico, the director left the office owing Social Security more than 100,000 €. We managed the situation, but our investment capacity was totally limited and we never recovered the initiative there. In Colombia, the director, also an ex Meta 4, doesn’t sell projects but at the same time, was setting up two personal companies—pure science fiction. The Barcelona office depends on a sole person with the risk that carries. After the consecutive exit of two managers, we don’t have the resources to start from zero again.
• The Madrid sales team left the company for an offer from SAP that was too good to pass up. They have been replaced, but the momentum is already lost and the new team isn’t working out.
• The money is dwindling and not only do the new partners not help generate sales, but they are also pushing for a suicide merger with another company. At the beginning of all this I didn’t understand how people at such high levels could be so blind as to promote that merger, but Madrid is very small and I eventually found out about the true interest behind the intentions of that merger.
• When it rains, it pours; 2013 is the year the global crisis arrives to the learning industry. The drop in opportunities was radical, and our main client went bankrupt as well, leaving us with a debt of more than 100,000 €.

In those months, I felt truly alone, sad, and exhausted. But as I said two years ago during my mother’s funeral, in tragic moments there are always flashes of comedy or joy. In those months, I created the apps for children from the Clara and Her Sisters series. We made 3 games: Clara City, Clara Supermarket, and Clara Animals and reached more than 1,000,000 downloads in 194 countries and more than 11 million game sessions. Apple featured the game in the Apple store, including in the US.

Clara and Her Sisters featured in the Apple Store for the USA

(To be continued) We will publish a part of this story every week, if you do not want to wait you can download the full article at: https://jvsp.io/resources/