One of my AI writing passions is to find innovative CEOs applying AI to enlighten my readers on the value of AI, but also expose the vulnerabilities of building a company from scratch and sharing the lessons learned along the way.
For anyone who has read the book Good to Great by James Collin, you will recall the business imperative to having a clear and compelling vision is crucial to achieving success in both business and life. In fact, research shows that companies with a strong sense of purpose and vision outperform their peers by a wide margin. Also, a clear corporate vision—not a vision statement—improves organizational performance and attracts top talent, further validated by Author Mark Lipton in his book, Guiding Growth: How Vision Keeps Companies on Course.
In addition, the Conference Board recently released the results of a study involving 700 global CEOs; the CEOs were asked what they think are the key management and marketplace issues. For 2002, the top one was “Engaging employees in the vision.” While it was also number 1 in 2001, the percentage of CEOs ranking it at the top was even greater in 2002. While CEOs really believe in vision, they unfortunately have a difficult time developing a growth vision and executing against it – and being able to see what changes are happening in real time in an organization has never been more important to increase employee happiness and wellbeing (See Note below).
What I love about Vendasta’s vision is the passion of the founder and CEO, Brendan King, who is acutely focused on their vision which is” to democratize technology by making it easy, accessible and affordable for local businesses.”
In his words, “today it’s just too hard for small businesses to use the technologies they need to run their businesses. Small businesses are the lifeblood of the global economy and helping them is the reason that Vendastians come to work every day.”
What a fun ride to be called a Vendastian – a change impact navigator to bring more health and prosperity to the worlds biggest economy. According to the World Trade Organization, small-and medium-sized enterprises (SMEs) represent over 90 per cent of the business population, 60-70% of employment and 55% of GDP in developed economies.
Roots to Growth
Growing a business is not easy. It is never a straight line and many zig zags and pivots are needed to counter market realities or handle what life puts in our way. Henry Ford knew this and also the sheer importance of a bigger vision when he said: “A business that makes nothing but money is a poor business.”
In the early days, Vendasta set out to help homeowners find service providers like plumbers, landscapers, contractors, electricians, and realtors. Ones that their friends had used and trusted. As part of this, Vendasta had a free tool to help local businesses to get found online and manage their reputation. This was in 2008 and the iPhone was just released and the internet and Google were becoming ubiquitous.
Consumers were looking for businesses online. If they weren’t found, they were losing business, and if they were found, they needed to have high ratings and outstanding reviews because the next business was literally a click away.
Vendasta’s free tool took off, but they found it was making them broke. They had to find a way to sell the tool rather than give it away for free.
They started by selling a listings product to help businesses get found online, a reputation management product to build their online reputation, a social media marketing product to build their online fan base, a website product to build out their online presence, and an advertising product to inform them on how their digital campaigns were performing. They primarily sold these products as white-label solutions through channel partners like newspaper companies and yellow pages at the time. They had roughly ten of the top fifteen newspapers as partners with names like Hearst and Gannett.
As they started to sell these products to SMBs through more and more channel partner relationships (newspapers, radio and TV stations, digital agencies and consultants, etc.), they started to realize that the channel partners needed much more help. While they continued to need more high-value solutions to sell, they also needed a platform to help them sell more effectively. So Vendasta built a platform to help these channel partners market, sell, bill, fulfill and deliver these products to their SMB clients. They also knew they could not build every solution a business needs, so they needed to evolve and develop a marketplace of 3rd-party products that their channel partners could sell. A real key is that the marketplace deeply integrates products meaning that once purchased, an SMB can access all solutions through a single username and password, centralize their reporting and notifications, and manage user access in one place.
Staying close to their vision, they knew success was making it easy, accessible, and affordable for SMBs.
Over the years, Vendasta has successfully raised $175M of capital, with investors: Vanedge Capital, BDC Capital, Canadian Business Growth Fund (CBGF), NIcola Wealth, BMO, Luxor Capital Group, and the Foundry Group.
Now considered a promising Canadian born unicorn, Vendasta, is looking well ahead with global expansion to other countries like India. In India, over 99% of total MSMEs qualify as micro-enterprises that make up to 630.5 lakh enterprises. Clearly penetrating and helping to modernize India will require the wings of Amelia Earhart who said: “The most difficult thing is the decision to act, the rest is merely tenacity.”
It takes a lot of courage and even more curiosity to expand one’s wingspan, as my dear friend, Dr. Diane Hamilton’s research has validated, one of our world’s top global female thinkers.
Innovation is driven by courage and curiousity – and it’s not easy to master and sustain.
There is also a body of research that has found that humans that grow up in open vast spaces like Brendan did in Saskatchewan, are more creative and are more expansive and curious thinkers.
Those who live and travel on the prairie know the land to be rich in varying landscapes ranging from the flat or gently rolling grasslands, to lush coulees (wooded valleys), wide river valleys, aspen bluffs, delicate and shifting sand hills, beautiful badlands and seasonal wetlands (sloughs) cradled in low spots everywhere and filled by spring runoffs. It is a land pulsating with life, endless in its moods. Grass is the foundation of the prairie with eighty percent of the prairie land made up of different species of grass. Dozens of varieties of wildflowers bloom in their midst. An array of different birds, mammals and insects, live in harmony on the landscape.
Such beauty and harmony growing up in the vastness of the prairies, I believe is one of the natural driving forces propelling Vendasta foreward. If you ever visit Saskatoon where there head office is you will find a vibrant office of employees passionate about the future and are lining up behind Brendan’s positive energy source.
Like every CEO focused on growth, the technology landscape for small businesses is getting more fragmented by the day. It is harder and harder to choose, buy, implement and use technology. These businesses don’t want multiple vendors, they simply want to buy from a vendor they trust. According to Brendan, “it is Vendasta’s job to help vendors sell everything these businesses need and that is no small challenge.”
With the explosion and growth of AI, Vendasta has also applied AI in innovative ways to help small businesses better communicate, connect, and service their customers all while increasing efficiency. Like all technology companies, they are recruiting in areas that best help their customers. AI certainly plays a role in selection, not just in engineering, but almost any role that can leverage AI to increase productivity and quality of output. They are in particular advancing the use of generative AI in all their product areas and a cornerstone of their business strategy.
Vendasta has amassed significant proprietary data on businesses and is a system of engagement with AI-enabled user workflows. They collect a variety of business data types such as location, descriptions, what credit cards they take, products they sell, hours of operation, all marketing data from the website, social posts, consumer reviews, photos, videos and other user generated content. They also have the small business and their agency using their solutions to advertise, market, communicate with customers, manage their CRM, book meetings, and bill clients. They are leading the way in using AI to do the heavy lifting for all of these. AI can comprehend all of the data, and when instructed properly can create relevant content that would take humans hundreds of hours of research.
Vendasta’s biggest differentiating quality is that they are an end-to-end platform for companies that serve SMBs. While they have numerous feature-based competitors, there are very few companies who compete with them at the platform level. For instance, they may partner with a company who uses competing software for managing email campaigns which would compete with our campaigning feature, but would not compete at the platform level.
The platforms they run up most up against most are: Birdeye, GoHighLevel, and Podium. In each case, Vendasta differentiates differently. Birdeye, for example, provides a platform targeted at SMBs and multi-locations, but has not invested in a platform for channel partners to manage these relationships at scale. While Vendasta has a number of competitors for specific platform features and functionality, there’s only a few that they run up against currently.
The threat always remains for increased market consolidation but Vendasta has a front running seat, with a bolder vision well underway with a global expansion plan that is now underway.
Under this growth foundation is also a clear position on ethical AI as the company takes thoughtful time to address ethical AI practices in a meaningful way, and unlike many companies, Vendasta does have an AI Ethics policy in place. Their commitment aligns closely with the principles of transparency, responsibility, and openness in the development and deployment of AI technologies. They strive to assess and mitigate risks to legal rights and democratic norms throughout the entire lifecycle of their AI systems. They actively work to minimize bias and inaccuracies in AI outputs, allowing users to discern between AI and human-generated results. Their ethical impact assessments, source code reviews, and commitment to explainability reflect a strong dedication to accountability and transparency.
They are also encouraging responsible research through controlled test environments, and oversight mechanisms are in place to monitor AI systems effectively. Additionally, they take environmental impacts into consideration and provide comprehensive training to our team, emphasizing legal, ethical, and operational aspects of AI. They have also established an inclusive engagement processes aim to raise awareness, build trust, and bridge digital divides in our AI projects. Overall, their AI Ethics policy underscores a robust commitment to responsible AI practices and making a positive societal impact while mitigating potential risks.
Lessons Learned as a Growth Oriented CEO
Brendan King had also a few key lessons learned on his journey to date and are nicely summed up. First, the best way to sell is to teach. Second, software needs to work out of the box and simply. Third, being challenged in life is inevitable, being defeated is optional. Never give up. Fourth, don’t fall in love with your product, fall in love with your customer’s problems and Fifth, build something you can resell over and over.
Conclusion
Finding CEO’s growing global businesses with AI as a foundation, deeply integrated with trusted and responsible AI practices are not easy to find in the AI wild west. What is powerful about Vendasta’s story is the journey in itself, from having the courage to iterate and over time build a stronger platform with deeper root systems to allow their branches to multiply, at the same time, not losing sight of the social and ethical responsibilities of building responsible AI practices.
Brendan has a clear sense of the market evolution as well, as he pointed out in closing out our session, the big winners will first be the big chip makers with folks like NVIDIA. Well this point sure is true, as NVIDIA’s stock price is soaring close to $800.00 USD a share, and has a market valuation of over As of February 2024 NVIDIA has a market cap of $1,970 Trillion. This makes NVIDIA the world’s 4th most valuable company. Second, the large language models with market leaders like Google, Amazon, OpenAI and Meta will continue to power data distribution. The next two groups of winners Brendan classifies as the long tail, with many winners.
This is where he sees Vendasta and its competitors are focused – this group will be companies with large sets of proprietary data, and the other group will be companies that are systems of engagement those with highly active user workflows.
In closing, the next era of Vendasta’s AI evolution will be in enabling and amplifying data intelligence to tap into SMB’s growth trajectory and help connect fragmented ecosystems, with a vigilant focus on building responsible and trusted AI practices – at every step in their journey.
Research Sources:
Conference Board Research
Saskatchewan, Great Prairies. (Description)
World Bank Economic Report – Small Businesses
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