Bootstrapping to $80 Million from Canada: Rob Purdy, CEO of Power2Motivate (Part 7)

Sramana Mitra: What was the first year of that product being revenue-generating?

Rob Purdy: It would have started generating a little bit of revenue in 2012. At that point in time, we had 20 licensees for Power2Motivate. The only people using the reward component was us and our direct customers. The other 19 licensees were not using our reward platform. We had $20 million revenue in rewards.

Sramana Mitra: What did that do to your business in 2013 and 2014?

Rob Purdy: The impact was a slow adoption by our existing partners. It’s hard for them to give up what they have built themselves. At the end of 2013, we made it a policy that they had no choice but to use our platform. Today, every one of those partners will tell you that it was the best decision we ever made.

By forcing them to use it, it allowed us to consolidate that $20 million and we leveraged that with all our supply chain networks to build even better supply networks. As a net effect, it also enabled our partners from being a local provider in Australia or US to now being a global platform. That was a major inflection point.

We went from being a global front-end software to being a complete end-to-end global provider of solutions. Our company has grown pretty significantly as a result of that. We see that continuing for many years to come. That product has done wonders in terms of being able to reshape our business.

Sramana Mitra: Based on that inflection point, where are you now? What revenue number did you close 2016 at?

Rob Purdy: We closed just shy of $80 million. Today, we probably have $200 million in contracts that we’re on boarding.

Sramana Mitra: You’ve continued to, more or less, keep this organic. You’ve brought on a bunch of investors to buy out your original partner with some very interesting financial engineering, but you haven’t taken any outside financing.

Rob Purdy: No, we haven’t, but we’re at a point where that’s probably the next step for us. I suspect that will happen this year. The reason for that is that we believe we’ve built what we set out to build. We’ve built and monetized the product to a point where we have solid valuations. We’re profitable and we’re in a position to get good credit for the work we’ve done. Remaining bootstrapped along the way allowed us to stick to our vision.

Sramana Mitra: Excellent execution. How many people do you have?

Rob Purdy: We’re 145 right now.

Sramana Mitra: $80 million with 145 people. That’s solid.

Rob Purdy: Yes, it is. We won’t see an exponential growth in staff because what we’ve built is significant automation within the products themselves. As you scale one aspect of Power2Motivate, they’re pretty well built out from an automation point of view.

Sramana Mitra: Excellent. Is there anything else you want to add to this story? We love these kinds of great organically grown companies. Our philosophy is entrepreneurship equals customers, revenues, and profits. Financing is optional. You’re a great poster child for that philosophy.

Rob Purdy: It was a story of perseverance. We traveled the world for two solid years. You actually have to go to every country. When you think about that process, it’s a fairly daunting process. Two of us traveled for two straight years. We secured all those meetings and contracts. We’ll exceed 300 vendors by the end of this year. Aggregate-wise, there’s about 20 million merchandise items that we’ve built up.

On top of that, there’s multitudes of other products such as global travel and millions of ebooks, movies, and music. Being able to deliver that content in a uniform way was our mandate. What sets us apart is when you go to some of these outlying countries, we have very significant rewards. People living in those countries love it. They love the fact that they can get things for the very first time that they just couldn’t have access to in the past.

Sramana Mitra: Awesome. Thank you for your time.

This segment is part 7 in the series : Bootstrapping to $80 Million from Canada: Rob Purdy, CEO of Power2Motivate
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