When Flexperto was founded back in 2012, its founder’s vision was to create the leading platform for digital sales to customer communication. From 2015 onwards, Deutsche Telekom and hubraum supported the development of this SaaS platform. Today, Flexperto is profitable, with 160% of growth in 2020. Now, Flexperto becomes part of the RGI Group, an independent software vendor and European leader in digitally transforming the insurance business.
Over the past few years the Flexperto team, currently boasting 30 employees, developed the platform which now delivers “Online Consulting Software for the New Normal”. The promise: Everything that your sales team once did offline is now possible to do online thanks to Flexperto: schedule customer appointments, meet via video chat, view documents together, sign contracts, or chat via WhatsApp. As such, Flexperto customers can manage their entire sales process in one place.
With this platform, Flexperto was able to secure a number of important customers primarily from insurance and banking, but also the energy and telecommunications sectors. Today Flexperto belongs to the happy few who profited from the ongoing Corona pandemic, adding a hefty revenue and usage growth as customers scrambled to digitize their customer relations.
We marked the occasion with a discussion with Flexperto co-founder and CEO Felix Anthonj and hubraum’s Investment Director Florian Steger.
Felix: That was a lucky moment, actually. We had just moved to Berlin at the time and had our first office in Adlershof. Then a friend put us in touch with hubraum, and we pitched them a few times. This resulted in our first funding from hubraum, IBB and some business angels, and consequently the move to hubraum in Schöneberg, which was an improvement in itself. We stayed at hubraum for two years until our team grew too big and we had to find our own space. Since Flexperto was the first venture for all of us, the time at hubraum was awesome. We had all these great people around us, always supporting us and helping in all kinds of ways. There was also a lot of social interaction besides growing our business, which was great, too.
Florian: From the very beginning, Flexperto’s goal was to bring together all channels and collaboration tools for sales in a single platform. Since this is obviously also a high-level issue for Deutsche Telekom — which plays on all channels and also uses them itself — this was the initial idea for us. We then invested seed funding in a product pilot and also supported the technical development of the product, among other things with the Open Telekom Cloud (OTC). Due to its security and compliance aspects, OTC in particular was very important for helping Flexperto to stand out from the competition. We also supported Flexperto in customer acquisition and, last but not least, we ourselves used the platform for our own sales activities. So even though it took a long time, the basic idea remained valid.
Felix: Well, it was not easy at first. Telekom didn’t use Flexperto right from the start, so it was initially a bit tedious. But eventually we were able to get into a reseller partnership for the automotive sector with T-Systems and some other Telekom departments started using the Flexperto platform for their own customer relationship management. We found very valuable contacts both through our partners at Telekom and hubraum and also through the many hubraum events. Also, the infrastructure and the Telekom brand itself helped a lot, especially since Flexperto was our first startup.
Felix: Most of the funds were used to build our team. We were able to hire more experienced people, and again, hubraum proved to be very useful for targeting the right guys. We were also able to pay a modest salary for ourselves, we spent some money on marketing, and since ours is a B2B business, we had to pre-finance our growth to bridge the time lag resulting from sales cycles of 6 to 12 months.
Felix: The money was extremely important, of course, but also the time in hubraum in general, the networks of cool people, and let’s not forget the parties and the time spent on the roof in summer.
We actually decided in January 2020, before coronavirus hit, to change our choice of shareholders. We were looking for the next level, not strictly an exit, as we wanted to stay in the company. Of course, an exit was inevitable from the very beginning, with a time horizon of five or maybe seven years. In our case, the M&A process took roughly a year – not three to six months as they tell you, especially if you sell to a strategic buyer.
I was in Capetown most of the time and thanks to the M&A process, worked long hours and conducted endless video calls round the clock. There were also constant surprises, up until the very last minute. So it was quite an emotional rollercoaster, which I think is very important to state since the whole process requires a lot of energy and attention.
So in our case, due to the coronavirus pandemic, everything was done remotely; I never actually met the new investor, I didn’t even meet the notary, so the signing process felt very surreal since I didn’t sign anything myself.
Florian: The buyer RGI also wants Flexperto to continue to function as an independent company for the time being after their takeover of the shares, but will support the company with its resources and reach in the European market to secure much more business.
Florian: For us, this collaboration worked out very well, since our high-level thesis was confirmed in all areas. Flexperto collaborated with Techboost and T-Systems to sell their product, made very good use of OTC, and there are new pilot projects at DT underway which use the platform. One example is our online video consulting service MagentaService Live which is available to both private and business customers.
As such, the collaboration between Flexperto and Telekom will continue, both in sales and in using the platform for our own customer communications. You could say that hubraum has done its job: incubated a potential partner at an early stage and supported this company in developing into a full-fledged partner.
The case also perfectly demonstrates the importance of startups having a basic hypothesis that ideally holds true for a number of years, e.g., solves a problem permanently or ushers in a paradigm shift in customer communication. If you can then also benefit from technical developments or, as in the current environment, from external shocks such as the coronavirus pandemic, even better.
Last but not least, I would also like to emphasize what a positive experience it was collaborating with the other investors. In Flexperto’s case, there was an ideal mix of angel investors from the software and insurance industries, a financial investor like Berliner Volksbank in the mix, and a strategic investor (ourselves).
With regard to working with hubraum: It definitely makes sense to work with them as a young entrepreneur since hubraum is a natural destination for first-time founders. Of course, the focus of your business should also overlap with Telekom’s areas of interest. hubraum is a great starting base, and I’d say the same about Berlin. You can start out in a supportive and nurturing environment, you’ll receive support in many areas of your business, such as recruitment, which is extremely helpful.
With regard to our exit, what was important for us was that we always exceeded the goals set in our business plan, which meant we were in a strong position, which proved helpful when negotiating. Also, positive surprises like profitability help. So it’s important to not lose your focus on your operations. Meeting customers is more important than meeting potential buyers, and strategic buyers are more interested in profitability then your VC investors were!
For further information on Flexperto’s successful exit, tune in to our recording of last week’s On Air session with Felix, Florian and Min-Sung Sean Kim.
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