How Collabogence Inc CEO Peter Smit grew Collabogence Inc to $220K revenue and 1 customers in 2021.

hello everyone my guest today is Peter SMI he spent half of his life on the other side of the Atlantic and lived in seven countries and also speaks four languages he raised in the age of Matrix management running programs initiatives projects and businesses globally he's been a long proponent of collaboration and tools which enable it he's today the CEO and founder of cabagin a Toronto based firm which uses data to measure the changes in Effectiveness and productivity of people and spaces Peter are you ready to take us to the top yes absolutely so just to be clear is this sort of a consulting company or is there real software powering what you do it's a SAS business oh at a in an earlier phase of my life I spent doing consulting work and this is now a pure play analytics company so it's a tool which either companies use directly or Consulting companies such as facilities management or HR strategy consulting or workplace strategy Consulting companies would use to implement and do larger projects with their clients and what do you sell it for what do they pay you per month on average to use the tech so so this is something that depends on the number of data sets that or applications that data is pulled from and the number of people that are used but it typically ranges in anywhere between two to five dollar per month per person so it's a typical SAS uh application that in the longer term the value for the client comes out of the dashboards and the insights that they can derive from that now are people usually buying this directly or is it usually a company logo signing up for 100 seats or something like that no so this is we're still in an early stage so we're looking at largely or larger organizations from this perspective um so we're looking for projects with thousand to 2,000 or more people but we're talking to Major Banks um pharmaceutical companies that are all looking at 50,000 plus per year so in the first phase we'd be looking at typically a large building which would have uh anywhere between two to 5 thousand people and when did you launch the company what year so the year the company was launched about five years ago as a name um we went down a road first in terms of since we was focused around measuring collaborative performance we were looking at the HR space and the frustration back then was they weren't comfortable with data they weren't comfortable with de identifying they weren't didn't have the authority or the power to actually Implement what needed to be done so we then switched um somebody put me on a speaker stand at a conference which was work Tech uh so technology in the workspace and that's where the first clients came on board which were companies that were doing major changes in the workplace strategy so moving from assigned desk to activity based workspace for instance um that were then interested in actually measuring the impact of the productivity and effectiveness of their people and their spaces so what year did you get your first customers paying for the software the software tool so that would have been in 18 2018 okay and remember do before we get more of your backstory it just sort of teased us a little bit do you remember what Revenue was back in 2018 your first year selling the software first year was about 70,000 okay yep and probably in the hundreds last year and right now because we've done a major shift toward helping organizations with the workplace strategy both to work from home and new office environments uh we see that going up to probably a run rate of close to a million by the second half of the year and what run we are you at right now so we now we're looking at we're transitioning in the phase from Project based to um FAS so we don't have the monthly subscriptions yet but we anticipate that signing those the first ones of those in the next uh by the end of the first quarter how much revenue did you do total in December oh in December no for the whole year was about 100 so we're not on a we're not on subscription base yet okay so when I asked you earlier when you sold your first software you said 2018 if you weren't selling subscription software back in 2018 what were you selling Project based okay there wasn't software you were selling then it was it was project management um no it was it was all algorithms that we Ed with their data so it was more of a before and after and the insights and analytics that came out of that uh recommendations were done by the consultants and the company itself I see okay and so so um help me understand today a little bit more about the team before we dive into your product and the problems you're trying to solve how many Engineers are on the team so we have about six right now um and we're prepare preparing everything for the next big data sets that'll be coming somewhere toward the end of the first quarter that we'll be looking at which we'll also use to build the dashboards which ultimately will become the SAS platform and Peter What's the total team size today six six plus myself okay oh so they're all Engineers all well there's one one one big business person um who also has a lot of management experience with the in the technical environment and build of these types of organizations he'll transition more into a chief operating officer okay so um yeah so you can't have a six total team size and then six engineers and then one extra that would be seven total so like What's the total okay seven total including you yes including me okay so so that means five of them are engineers and then you have a this coo guy and then you correct I see okay and and so give us more of the backstory here what sort of got you into this space so what after business school which I did in the United States I landed at honeywell's European head office and then went to a Swiss company which is now part of seaman in Switzerland in global roles because I speak a bunch of languages I was launching products globally uh Global account account management these types of things and if I fast forward to five years ago with the Inception of of cabagin was really the idea that I saw companies that were looking to do one of three things or all three at the same time one was to change the culture in the way they work with each other so they needed to have a better understanding of how they work with each other and they wanted to become more collaborative they were changing their workplace strategy and office utilization and shifting from the assigned desk environment to the activity based workspace model and also with the goal of becoming more productive and collaborative and then they were busy implementing a lot of Technology tools which were also enablers to improve collaboration and my comment was that they were spending millions of dollars on each of these initiatives and had no ability to establish a Baseline and no ability to measure any actual impact or change in the behavior so we don't profess to measure productivity what we can show you is change in Effectiveness and productivity which is aoxy for a change in productivity how can you not measure productivity but be able to measure change in productivity it feels like you have to have both traditionally came out of the Industrial Revolution where they were looking at how many widgets can we produce and in a knowledge-based environment productivity is a very difficult thing to measure and other than the financial results of a company overall so really if you want to if you want to do it and we're having some early discussions with some clients that want to start looking at tying change in this measure to um Performance Management so what does that mean though this this all these all feel like big fancy sort of Harvard Business Review Book sort of words to me versus practical real things actually happening in Dev shops and Dev teams well the Practical thing so one of the things that we did is the first client was a major Bank who was shifting thousands of people from traditional office environments to activity based workspace and they were creating spaces with 500 people and they wanted to see who should actually share the space with each other with the view of that it would improve the collaborative collaborative performance so what we then did is we pulled data sets after after 100 you know typically they say at least 100 days in the new space and the new environment before you measure again what were some of those data pieces pardon what were some of those data pieces be specific so if you look at the data sets we could we'll pull data from everything from email to messaging to web conferencing to documents and we use that we have algorithms that actually look at the strength of a relationship between people which is not based on just on volume but also reciprocity so with that we can start looking at measuring the strength between two people but also between two teams and between Collective within a team so if you had a group of 500 people what we actually saw was an increase of well over 30% of that measure that we had so there was a significant benefit of them sharing the space with each other and this is one of the things that now we're looking to do is with some organizations is to actually look to see what has happened to the Collective Strength of these organizations as they've shifted to working from home but what if you're measuring the wrong thing I mean why would email velocity or number of documents shared be a direct correlation to productivity I hate email and I hate documents and I hate Google Drive and organizing documents why would that correlate to productivity well we're not we're not measuring the volume of it we're also saying what I was saying is the reciprocity which has to do with the strength of the relationship between two individuals...