From Solo Entrepreneur to $65 Million in Revenue: Brazilian Entrepreneur Daniel Scandian, CEO of MadeiraMadeira (Part 4)

Daniel Scandian: We realized that that process was the same that should work in Brazil. Of course, the software was a little bit different, but the workflow was quite the same. We were lucky for them to open to us. We went to Brazil and started building a software. The Brazilian market is much more complicated than the US market. We started to build our software in the beginning of 2013.

We thought that we could finish the first phase of the software in a year and a half. It actually took more time. It took us three and a half years to finish building the software. That period of time was very difficult to explain to our investors as to what was going on. We were asking for more money to finish. That was real complicated.

Sramana Mitra: They weren’t sure you knew what you were doing.

Daniel Scandian: Yes. We convinced them to make another investment in the company.

Sramana Mitra: What do you think convinced them?

Daniel Scandian: I had to explain to them what we have achieved and the other steps that we needed to finish.

Sramana Mitra: Were you doing the software with an in-house team?

Daniel Scandian: Everything was in-house. We worked 20 hours a day for a year and a half. We had around seven people building it. That was much more complicated than imagined. We also had to convince our suppliers to adopt the drop-shipping model in scale. That was a difficult part as well. I had to visit and talk to the owner of the factory that that’s the future.

Sramana Mitra: All this while you continued with the drop-ship zero-inventory model?

Daniel Scandian: Yes. At the same time, we were getting a lot of pressure to build the company to include more products and build the software.

Sramana Mitra: While you were building this software and there were some hiccups, how did the business do? In 2011, you did $4 million. How did you do in 2012 and 2013?

Daniel Scandian: We were growing around 80%. We finished 100% of the software but part of the software was helping us in some situations. Every phase of the software was helping a part of the operations towards becoming better and better. But the whole ecosystem was only finished in the beginning of 2015.

Sramana Mitra: You continued with the 80% year-over-year growth through to 2015?

Daniel Scandian: Yes. The Brazilian economy in 2015 was worse in the beginning, but we grew 109% and in 2016, we grew 113%. It was a good feeling when we started to see the results after January 2015. We broke even in August 2015. Earlier, we were losing a half million dollars per month. We had to get another $8 million investment to cover that before we broke even.

Sramana Mitra: What is the total amount of money that you have raised so far?

Daniel Scandian: $12 million.

This segment is part 4 in the series : From Solo Entrepreneur to $65 Million in Revenue: Brazilian Entrepreneur Daniel Scandian, CEO of MadeiraMadeira
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