How Theomx CEO Nicole Verkindt grew to $2.2M revenue and 40 customers in 2024.

hello everyone my guest today is Nicole vork n she's the founder and CEO of Canadian technology company called omx previously she led a high-tech manufacturing business selling to governments around the world Nicole is on the board of the Canadian crown corporation that performs government-to-government can contracts between Canada and other countries around the world she's a dragon on CBC's next-gen Dragons Den which is dedicated to early-stage technology businesses and joined gimlets media show the pitch as the fourth investor in the 2018 season Nicole are you ready to take us to the top all right good so so first question first you have your hand in a lot of media related stuff with your show with gimlets thing but you're also kind of running your own company they have to compete from our priority perspective or if not how do they feed each other yeah they definitely compete that is that is the constant battle is trying to balance those two things but we with omx we sell to government but mostly big industrial companies traditional corporations so the work I do I'm also on the board of the Canadian Chamber of Commerce well so that kind of stuff is really good because we do get we do position ourselves as thought leaders in the space I'm digitizing traditional businesses and it does help our business and it's really good from a from a positioning perspective so give us kind of give us a customer example of what omx you know maybe who you sell to Raytheon General Dynamics etc walk me through how they use you guys yeah so we do a lot of work in what I call the regulated market so energy infrastructure mining aerospace defense and they essentially use us to it's basically CRM for supply chain and then it's Expedia for supply chain opportunities so b2b a procurement opportunity suite data from from sa P from RFQ to go from Bravo solutions jaggers and largest e-procurement solutions plus our own exclusive ones and send them out to all the different companies that that matched by essentially building AP eyes to a whole bunch of different solutions in different data feeds so I would say it's CRM for supply chain it's Expedia for supply chain and then one of the big innovative things we do is actually rolling up all the socio-economic impact data so we're competing against the KP and DS of the world who will traditionally manually go out and do this you know half-a-million-dollar study for a company to say this is the job creation and the impacts you're having and it sounds like a weird esoteric thing that you would need the average person but all the companies in our sectors are required to do this reporting back to government and they have to do it when they go out to bid for new projects like a new major infrastructure project for instance so we're digitizing that whole process the CRM aspect makes me think pure-play SAS you think helps buy you things Salesforce the Expedia makes me think of a much tougher market which is a marketplace market where you're taking cuts of fees in between you get data and use that data to do bigger studies which one of those revenue streams make up makes up a larger portion of your business it's just all SAS based but you're right it is unique to have a SAS model in a marketplace that's actually been a challenge which came first actually the marketplace came first ok and and what advantages to launching assassin sorry because what brings the buy-side the big industrial corporations that are releasing their procurement opportunities is our reporting functionality when we release the solution they were they were both there ok and what year was that when was your one the solution was released in early 2012 2012 ok and then let's just focus we'll focus in here on the south side of things and then we'll shift it got in the media stuff you're working on so in 2012 you launched omx a big portion actually all of it is SAS there's a marketplace model on top of it give me a general sense these companies I mean I'm sure you have many different cohorts but on average what's customer paying you per month the buy-side on average is paying about 3,500 not on average the low-end is about 3500 a month and that's in Canadian dollar so be more in US and then on the sell side it's about 150 ok ok 150 bucks so very much you're representing by side mostly that's where most the revenues coming from that's right about 90 percent yep ok great and and bootstrap Trevor you raise capital we just raised a small amount of capital about a million dollars from friends and family and we got some government loans that we paid back okay that you know once you're on kind of the raised train it's a whole different ballgame so why give up even if it's a little bit why give up even a little bit of control why not keep bootstrapping yeah exactly I mean we thought we were getting on the race train I went out to raise us to do a significant VC race and I just had a lot of challenges with that process and I mean you and I spoke earlier about how much I feel the community has changed especially in Canada in the last eight years but we had there wasn't really any early-stage venture capital when we were going out and so I don't feel that we got on the race trade and we tried to and we did it and stumbled and we took a little bit of friends and family money and in the grand scheme of things a million even that million we paid back some of it I wasn't here at or equity it was equity but I'm just saying some of it was structured as convertible that we were able to pay back yeah our option so I feel that we didn't actually get on the race train because I still have control just over 50% yep did you have co-founders in the business no but our CTO came in very early on and he has equity in the company I see okay great and what's a team size today uh there's about 20 people but and then a group of contractors that work in Europe India on New York and Ottawa there's full-time folks they mainly there in Canada in Toronto yeah the 20 other full-time are all in our office in Toronto okay great so you're building this tool your billion sold 2012 now did it take a lot of R&D to get to kind of your first sale and if so how many years would you have to go with kind of no revenue in other words hello were you supporting it with no revenue before you closed deal that's that's the thing right we went out to raise some real money and we weren't able to so I said you know what we need to release a feature that we can sell immediately and we were generating revenue than a few months after release okay 2012 that's great and then fast for today so six years later how many customers are you working with really does just focus on by side on the buy side there's about sort of 40 that are significant yeah 30 40 so is this I mean this is at the price point you're at and at 40 that screams to me kind of enterprise sales model is that accurate you have field reps inside sales team yeah and some of our deals are a lot bigger than the three grand a month that I indicated but yeah the sale cycles are two plus years which is you know that that's that's the big challenge there is that you have to be these things because they are complex sales they have to be bit bigger deals three thousand in Canadian is about twenty six hundred USD in terms of kind of your MIT you so it was a lower end average revenue per customer a month and we say that per program per country so if we get a big enterprise client that's got mostly they're managing supplier data across multiple major complex program so if I'm an investor company you know one road program so I'm basically managing all this data I'm producing on this real-time reporting on what's going on in the status and all that kind of thing so it depends on you know usually they'll start with one as a beta and then and then grow from there but we the other thing that we had to learn was we were very scared of the word services you know it's it's like a bad word in startups to have any consulting or you know ever sell anything by the hour but we what we had to learn very quickly why do you say that why do you say it's a net who who where'd it where did that impression come to you from I think investors give you that impression right so they'll only give you a multiple on your reoccurring revenue they only want it to be software related revenue so interesting though because if it's positioned we've had you know about three thousand these interviews and the ones that come on where they say are onboarding fee instead of our professional services revenue it's like so what we found and so we never chart we never charge for any of that stuff you know you've bought the software you know here's some training good luck but what we found with especially the enterprise because you'll get a senior level person that says we need this for the ROI and this and that we gotta go to the future and then the people that are actually supposed to be using it well they have their manual ways they have their personal ways of doing things and their relationship with the consulting firm it doesn't manually all that kind of stuff and so to get them to use it is it can be a big challenge in one training session isn't enough and then you're not gonna get your reoccurring usage of the platform and for us it's more valuable for them to be posting their procurement opportunities on top of them continuing to give us the revenue so the one of the most important takeaways I got from the first couple years was no you need to saw the outcoming you just say pay for the subscription this is your technology subscription plus you're gonna pay this little fee on top to ensure there's a you know omx Account Manager a person helping you through and the outcome you're gonna get is complete digitization of all of these elements because as you know if you're using a CRM and only a small portion of your data is in there the whole thing's completely useless so dry that was a big takeaway for us to not be afraid of that element of you know putting some man-hours behind making sure that the end customer gets everything they want out of it yeah data from folks I would say that's actually what you have to do to make sure your attend retention and a lifetime biometrics go up there has to be an onboarding for you to put touch on it especially well the data didn't exist really back then I don't think but I would agree with you totally let me I mean look I want to get a minimum here because I want to give you a credit where credit's do so right 3500 Canadian is 2600 USD multiplied by you know 40 customers you're north in purpley well north of a hundred grand per month at this point correct in M RR oh yeah yeah that's great what is your next big revenue goal what are you trying to grow to we're getting close to the five million mark is what we're trying to get to right now so but to me it's better that it's really good sticky revenue where they're also really really using this solution and also doing a lot of sourcing through the applications so making sure that we didn't those accounts I just put like one of our rockstars on our team an amazing amazing guy I just put him responsible for dealing with all the current accounts to make sure that they're getting the actual right procurement people on and the different you know making sure that the people that are using it are the right people so we can keep scaling on top of that yep is that fight you think you hit a 5 million by the end of the year this year December run right no that's that's in the next year so next year ok good and generally speaking what are you growing at currently you're every year ok that's pretty healthy Ken's considering that you basically bootstrap this 40% you over your growth is great and then I want to understand working about how you're onboarding new customer that sounds like this might be a bit of a longer sales cycle it does require touch when you look at your fully weighted kak where does that come in about oh I don't know our exact Simon calculate that a long time okay is it not is it just not it's not something you need to track because it's it you're making so much it doesn't it doesn't matter what you're spending to acquire or why isn't that something that you tracked in awhile well because we don't care that much what our CAC is on the sell side that the suppliers I mean I know we should because sorry I'm just talking by side I'm talking you're big enough you sell so we don't see it as a SAS model traditional like HubSpot because it's more like a linkedin model where suppliers come on and pay the fee respond to our fries then come down for free and there's thousands at that level so we don't track the CAC for the Southside for that reason on the buy side it's really hard to do we do we do a little bit of tracking but it's very much a traditional enterprise sales cycle where you're going to a trade show you're meeting 10 companies you're following up there in the funnel you're meeting them you're visiting them you're so and then there's like four people that enter a company that will touch that customer so we don't have the exact numbers on those how many deals I'm curious how you've built kind of your inside sales model you city off for how many deals do you like to see each of them closing per year like new a are added per year per sales rep so it's about seven or eight seven or eight oh seven or eight okay that's a lot so so each year you should expect them to close about 28 new deals all together all four Nicolle 4 times 7 is 28 yeah is that did I understand one make sure I understood you correctly is that right I don't know where you got the but yeah well you said you had four you said you had four inside sales reps today yeah you just you just you just said you had four people inside that worked these leads that go to the trade shows that close the sales yeah but is that a cure I might have misheard you did it accurate yeah there'd be for people that are definitely that are involved yeah yeah yeah okay let's let's shift away from SAS for a second you're sitting on company it's growing you own 50% of it it's basically bootstrapped why now go and say okay I'm gonna do Dragon's Den and I'm gonna do the pitch I'm gonna do these other things I just really enjoy it I really really like it so Dragon's Den was a two day commitment it wasn't a big deal but everyone seems so made it into one mm-hmm so I sat there for two days as somebody who had been in on that side of the equation pitching only three or four years prior so it was really almost surreal and I enjoyed just giving them advice on the really early days and so having them try to think through get to sales faster fail fast all those all those things that we all know all about now but I really really enjoyed it it was a really fun process and then the pitch the same thing it's like four days a year and I love meeting these different startups and they also they really helped me to to really think through our model and get some really crazy new ideas sometimes I actually have received some really neat innovative ideas on how to improve our platform pull one out of your head I'm just curious name one for me that's top of mind well we had somebody pitch us on gimlet media who's doing one-hour delivery and so I thought you know why couldn't you it might not be one hour but in the b2b space why couldn't you add a widget that reaches into Buber or some of these other platforms and sort of guarantees some kind of fashion delivery for a premium within an hour like why can't you be leveraging what's going on in consumer I know it takes way longer to have a trickle down and a b2b but you get lots of neat ideas lots of stuff in AI lots of stuff in managing big data that kind of stuff yep are you raising capital right now for the software for all Macs no no are you a knock position talks with anyone are you interested in selling no no you just want to eat keep it grow and hit the 5 million mark somewhere next year and just keep scaling yeah we're having a lot of fun too that's good alright Nicole let's wrap up with the famous five number one what's your favorite business book favorite business book my god I just read shoo dog and I and I loved it I don't know that's my favorite of all time but I loved it number two is there a CEO you're following or studying right now I've always loved Steve Jobs number four what's your favorite online tool for building a business wait you missed number three sorry that was number three favorite online tool I was by alright and number four how many hours of sleep are you getting every night how many hours of sleep oh god between five and seven okay we'll save maybe six on average and what's your situation married single kiddos [Music] in a relationship not married or kids okay that's good see have a look yeah a little bit more freedom than it look three young ones running around the house right yeah good and do my good I have a dog you have a dog so I have a half kid what got a half kid alright Nicole I'm a last question here what do you wish your 20 year old self knew oh god that it takes a long time guys it takes a long time be patient she launched omx back in 2011 really sorry 2014 really as a tool oh it's funny like a good 2011 to 2012 right first customer 2012 getting now about 40 customers she's really hopping on the buy side its procurement process specifically with things that are you know the Raytheon to the world the General Dynamics of the world she's helping also then on the data side doing custom reports who these folks serving currently about 40 customers that pay a minimum of call 2600 USD per month so well north of 100 grand per month in revenue hoping to scale to about five million in terms of an AR run right in the next year or so from 2017 2018 grew about forty percent year-over-year she's got a team of twenty folks up there and Canada I'll tell you what it's really booming up there Nicole thank you for taking us at the top eggs