Managing Multiple Pivots While Scaling to $50 Million: MotionPoint CEO Will Fleming (Part 7)

Sramana Mitra: How much of this is already in the market and how much of this is still in development?

Will Fleming: It’s hard to quantify but some is in the market in terms of capability baked into the current offering. Certainly, the majority is in development.

Sramana Mitra: This part of the pivot has not started impacting your revenues. Your revenue is still coming from the main core business.

Will Fleming: Correct.

Sramana Mitra: You said in 2011 you were north of $20 million. Have you grown significantly since then in the last five years?

Will Fleming: Yes, we’re at about $50 million.

Sramana Mitra: That’s still the core globalisation translation business?

Will Fleming: Correct.

Sramana Mitra: This is still an organically built company, right? You don’t have financing in the business or did you take financing down the road?

Will Fleming: When we were formed, we were funded by private individuals including founders and also a reasonably small group of private individuals. Around the time we were reaching that pivot back in 2010 – they were independent items but the timing did coincide – we brought in a private equity partner. Last year late 2014, we brought in another private equity partner.

Sramana Mitra: What is the total amount of money that you have raised with the private equity round?

Will Fleming: $17 million.

Sramana Mitra: Is this all growth capital or is this something that you use to take liquidity out for the earlier shareholders whether it’s founders, employees, or early investors?

Will Fleming: The one in 2010 was for enabling some of our early investors to realise liquidity and move on. We had pushed sums of our investor base who said, “My situation has changed. I have a preference for liquidity looking at what had happened.” We were sensitive to their preferences. At the same time, we realised that the business had a long, long runway. We were really eager to answer the question or, at least, wrestle with the question of how high is up for this business. We are really fortunate to find a private equity partner where all they do is global technology growth companies. It has to be growth-based companies. It has to be technology. It has to be global in scope.

Sramana Mitra: Which firm is that?

Will Fleming: Riverwood Capital.

Sramana Mitra: How much was the Riverwood first round – the one in which you gave liquidity to these early investors?

Will Fleming: I want to say that was $5 to $10 million but I don’t recall.

Sramana Mitra: These people who had put in about a million dollars got somewhere between $5 to $10 million out of that investment. You guys stayed on and moved to the next level. What about the second private equity round? Was that also liquidity?

Will Fleming: The second was growth capital.

Sramana Mitra: The second round was also Riverwood?

Will Fleming: The second one was Riverwood Capital and Morgan Stanley.

Sramana Mitra: Excellent.

Will Fleming: I don’t recall, off the top of my head, how much of the initial angel investment was that, they then got a fabulous return. In 2014, I was just going to comment further on Morgan Stanley’s investment. One of the really interesting opportunities for us that came directly as a result of Morgan Stanley’s investment was their obligation to do deep due diligence. We had this opportunity for really smart, sophisticated investors to do deep due diligence on us in late 2014. We get the benefit of the results of their findings.

I view that as almost a way of standing in front of a mirror with a really bright light. I see some things that I wished weren’t there or maybe I hadn’t noticed before. Morgan Stanley’s due diligence was really great in giving us clarity on some blind spots that we had and some opportunity so that we can really focus our energies in the right areas and in what really drives the business forward.

Sramana Mitra: It sounds like a very well-managed journey.

Will Fleming: Thanks.

Sramana Mitra: Thank you for your time.

This segment is part 7 in the series : Managing Multiple Pivots While Scaling to $50 Million: MotionPoint CEO Will Fleming
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