Jaakko Villa – TALKS WITH PETRI
Jaakko Villa talks about co-founding a successful growth company Idean and running it for many years but what happens when the co-founders part ways and his legacy is nowhere to be seen anymore. We also cover how to transform from direct sales to digital sales processes and what is an ethical design agency.
Jaakko Villa is a Finnish customer experience serial entrepreneur. He is currently managing Puheet customer community engagement SaaS business. In 2020, he co-founded Alpha Design Partners and already in 1999 the UX design firm Idean. At leisure time, he enjoys motorcycling and sports, especially basketball and badminton.
(NOTE: The text may contain errors, misconceptions and even comical unintended contexts. Please use it only as a reference to the actual audio conversation from where it has been transcribed.)
Petri: Why is equality in ownership not a good idea?
Jaakko: If you have equal ownership, everything goes into the trash from so many different perspectives. One of the examples is that if you have, you have the general meeting, you have the board of directors, the management team and the operational team present at the same time. It’s if not fully impossible, it’s nearly impossible to have anything that is under the argumentation to be decided and then move forward. The roles, everything…it’s very difficult to manage the company.
Petri: Sounds like you have some personal experience. Can you elaborate?
Jaakko: One of the first companies I was involved with we had equal shares, 20 per cent each, at the time the difficulties started. I was the CEO for about seven years. When we didn’t have anything, equal ownership was just okay. But when we had the business booming or growing steadily, sometimes faster, sometimes a little bit slower, difficulties started.
One of the reasons was that as a CEO, I wanted to do some things according to the strategy that we had decided. Let’s say I called the management team together, and then we decided to do something. But if in the management team there were opposing opinions or opinions from the owners that they didn’t want to do, according to what I had decided as a CEO or what we thought was the best from the strategic perspective they could do it.
There were no tools, nothing to guide them or direct them or order them to follow up what has happened with the decisions that we’ve made in the management team meeting. That’s one of the issues. And then in general, I would say that in startups and scale-ups, it’s always better to have a master’s voice, somebody who can make the final decision and who has the final go or no go decision in different decisions to be made. If it’s all too equal, it’s very difficult. It’s random. It doesn’t have a dynamic view to the company’s present or forward-looking operations.
Petri: Is it because of the background of the people or can it actually work in some instances? For example, if you split the company between two founders, 50/50, and then you start to take investors and other people on, or is it because those founders are basically in all the roles at the same time? They are on the board and they are owners and they have a shareholders’ agreement and it’s basically the same stuff. Or is it because of the different backgrounds and roles of the people in the company that some are more involved to the business side and some are into other aspects and there’s sort of a discrepancy between the understanding and agreement on how to grow the company, or can you be a bit more specific in what circumstances it works and in your experience as well, what is the setup you would like to do now knowing everything you know?
Jaakko: I think it is a mixture of everything that you’ve mentioned and probably some other things, too. What I would like to have, and what I have practised after that is that there has to be somebody who has always the final say. The final say can not come from the chairman of the board if he or she owns as many shares as, let’s say, the CEO or the management team. Organising the operational structure in the company is very difficult, if you have several owners who own the same amount of shares and to you face-to-face, they say that, okay, let’s do this, but they know that they have always the opportunity to do something else if they want.
Petri: Did something happen because I feel there’s more to the story? Can you maybe walk us through a bit of how did you get started with the company? You were there for seven years as a CEO and building the company, making it international, and you managed to put an impressive list of clients, global companies. I’m sure there’s a lot of stories you could tell us and probably some turmoil as well.
Jaakko: Yes, definitely. We started the company in ’99 with the name Suomen Oujee Oy. We were four very novices, how would I say, youngsters without true professions. I was the only one who had already quit the university and had my master thesis done. I was working just the previous two years in the Theater Academy of Finland, the higher education centre there.
Then one of the three other guys called me and asked me to join a meeting in Jyväskylä, Athens of Finland, to talk about an idea. They had this intriguing and fascinating idea to build a company called Suomen Oujee and start doing educational training, mostly in the Ostrobothnian area of Finland for the municipalities and local entrepreneurs. I thought that this is a crazy enough idea for me to join because I have always thought that if there’s only one thing that you can fully rely on it is yourself. And, with that type of a company, I thought that, yeah we definitely can do something and it might be fun.
I had been doing training and education in Theatre Academy, and I knew how to do it. So, I joined them. And actually in the beginning, in the very first months, we didn’t have equal ownership in the company. If I remember correctly, I had 14 per cent or something. Then we started doing the training programs in Ostrobothnia. We were sort of happy with that because we gained some customers and we gained better revenues than we thought in the first place.
We decided that we will change the ownership so that every one of us four guys had the same amount, twenty-five per cent. That’s what we did. Soon after, let’s say, it was one year after the founding of the company, one of the co-founders, called Mikko-Pekka, came by train from Tampere to Helsinki and I was waiting for him in the Helsinki railway station.
He literally had shivering hands and a shivering voice. He came to me and said that I had this excellent discussion with a guy I met on a train and he’s from Nokia. He’s an executive in Nokia. We have this fruitful discussion and he said that maybe in the future we could do something together. And I said to Mikko-Pekka that now call him immediately and try to arrange a meeting.
It was less than a month when we started doing project work for Nokia. Maybe at the end of the first project, maybe three months or so, Nokia told us that, Hey guys, you have an excellent approach in your work and what you are actually doing is usability testing and usability work.
We didn’t even know such a term existed at the time. They asked us to do some research with some users and give them prototypes of new digital mobile services and that is what we did. Because of our education as teachers, our approach to the users already at that time was full. We wanted to understand why they behave, where they come like they do. Where do they come from? What are the internal motivations, what they like about it, what they would like to see in the new prototype service? We decided to report that to Nokia and they thought that this is a new approach. It’s interesting. It’s fruitful. Nowadays, you might call that approach service design or participatory design. There are many names with that nowadays. Twenty-something years ago there was no domain for that and no terminology. And we didn’t know exactly what we were doing, but it was beneficial for them.
Our business started to move from educational training with Suomen Oujee for the Ostrobothnian entrepreneurs towards commercial design projects with Nokia, and soon after other customers in the booming digital wave that we had 20 years ago.
Petri: You were pretty lucky with the timing. It was booming around 2000. You went probably together with Nokia with your internationalisation?
Jaakko: Yes, we did. Yes. One of the learnings that I have is that timing is everything. It means everything. You can have the best idea for your business. You can have the best team to execute anything. You can have the funding. You can have everything, but if the timing fails, your business most likely fails.
There’s some evidence also supporting that you probably do remember a guy called Guy Kawasaki. He made research regarding the biggest reasons why startups and scale-ups fail. And surprisingly the biggest reason is the timing of the business. And we were very lucky. We definitely were very lucky in so many different things.
Not only timing-wise, but also that Mikko-Pekka was in the train and started talking opposite to a person who was interesting and open to discuss with 23-24 year young entrepreneurs. Then we decided to take advantage of that discussion. And our first projects were successful and yes, we were very lucky.
Also after that, we went with Nokia to Singapore. I might remember this wrong, but I believe it was 2003 or 2004 soon after that to China in Shanghai, 2004 or 2005, and then to London. Then we had 2006, when I was still the CEO, we had subsidiaries in all those countries. In Finland, we had Jyväskylä, Tampere and the headquarters in Espoo. I believe a bit more than 70 consultants altogether. And the biggest reason is the timing and the willingness to utilise the opportunities that come close to you.
Petri: But it sounds like that your ownership structure didn’t prevent you from doing those things.
Jaakko: Oh, in the beginning? Definitely, no. When we didn’t have anything to share everyone was together. Everyone was united and unified in so many different ways. That’s euphoric, it’s ecstatic. You see an opportunity. You run towards it. You manage to solve problems and challenges.
You can accomplish huge things together with your key team. That was wonderful. Then when you have a little slower growth period, and the plans that you have made for fast growth don’t really happen as they are supposed to, or you have a lot to share in your company.
Let’s say you can share out some dividends, you can decide what you want to do with your budget. You can have a real strategy that is not only reactive. You can predict things and you can decide where you put your focus into. That’s when the voices that have been passive during the fast growth, because you had so many things to do, or they have been passive because there was nothing to share among the group.
Then those voices become much louder. When you have more volumes you can decide where to focus, what are the actions that you will do. I believe it was 2004 or something, we made a very small acquisition of a small design company. And the other owner of the design company became the fifth equal owner of Idean. It was no Oujee anymore. At that time it was called Idean.
Petri: Can you explain the name?
Jaakko: Yeah. There’s a story also behind that why we changed it,
Petri: I’m more curious about the story, how it came up in the first place.
Jaakko: You mean Suomen Oujee? First, I need to say that, but how do you call them? I believe there was Yahoo already existed at that time, but there was…
Petri: Jippii was the Finnish another one…
Jaakko: Yeah, but Jippii came after us, but soon Jippii and Yahoo can’t remember the other ones who had funny names like that.
They didn’t give us good karma if you want to say that. We also had some projects in the Midlands of Northern America and the way how they pronounced Oujee was very close to Ouija, the spirit board, and we thought that maybe this is not the best idea to have a company called Oujee from the credibility perspective or internationalisation perspective or from many other perspectives that we could imagine and we were discussing about them. It was Risto, who then came up with a new name called Idean. And we decided to go with that. It was much better.
It was easier to understand. It was easier to pronounce. It was shorter than Suomen Oujee. That’s the story behind Oujee. I don’t know where it came from in the first place. Maybe it was something that somebody said in the first meeting that we should have this new company. Oujee! Maybe that was the name.
Petri: And then you’ll make it national by calling it Finnish Oujee, Suomen Oujee.
Jaakko: Yeah. We had to because the Trade Register didn’t accept only Oujee as our name. There had to be something else for it to pass the registeration process. And then we decided, okay. It’s not only Oujee, which doesn’t actually mean anything. It had to be something else, Suomen Oujee.
Petri: Before we went to that name issue, did you take any external capital or did you grow with the cash flow?
Jaakko: Grow with the cash flow. Only with the cash flow or using other words, money from the customers. We were very cheap in everything that we purchased and everything that we did. We flew where we needed to fly at the time with the most cheap tickets possible.
We accommodated ourselves in the most cheap motels or hotels possible, even in the US. I remember that some of the motels I stayed in there were meant for the truckers. I wouldn’t go there alone nowadays by myself or especially with my family.
It was all with the customers’ money and as I said, as long as we didn’t have a lot to share, we invested everything. Every single euro we received from the customer, we invested in growth and building the business. And there was the timing again because there were so many customers, so many projects. So much to gain both domestically in Finland and internationally that it was an easy decision to invest in growth. But then there was some downturn and that’s when the struggling of the strategic decisions and doing things together started.
And this is moving to something else already, but I guess it’s, it’s okay in this type of free discussion. I hired a COO, chief operating officer, in early 2006, after having discussions with this man. Maybe half a year already before he joined Idean. The main idea was that this man, maybe five years older than the rest of us, who had been a lawyer, who had been taking care of the financials in many companies, who had been responsible for the human resources and all the bureaucracy that I didn’t enjoy that much at the time.
I thought, and everyone inside the company thought that this is a good match. And, he had been working in Andersen Consulting and at least that is what we thought he knew how to put more gas in the flames and how to grow us much faster than we had been able to do before him joining us.
But it was only a matter of some months when I started to realise that, Hey, now the general atmosphere at the office among us owners and the management team has somehow changed. In spring 2006, we ended up discussing about what to do because we had already some millions of euros in revenues and we could do some from focusing and investing in indifferent things freely with the money from our customers.
This new CEO had different ideas of how to grow the company. He was a great salesman to the rest of the owners. This is not a true fact because I haven’t discussed this with the rest of the owners, but I believe that he had so different thoughts about the strategy and how to build the company to the next phase. He said that we need a different type of CEO for the company for the next years. That’s okay. That’s definitely okay. The company needs a different personality CEO in different phases of their growth. That was okay for me.
In August 2006, after several discussions, we decided that, okay, let’s get a new CEO for the company. We chose a headhunting agency for that and started the process with them. After that it was maybe only two weeks or so when I realised, even though I had initiated the headhunting process, I realised that the process is not a real process.
Because the rest of the owners had already decided that this COO will be the next CEO to replace me. And when I realised that I called the general meeting for the company and explained my side of the story and said that, okay, it’s okay for me if we change the CEO, I can take a sabbatical leave and come back later on.
But if this COO, and then I explained what I had felt that he had done during 2006, if he takes my place, I will not work for the company anymore. After that, I took my sabbatical leave that was supposed to be three months or so. I had been maybe three weeks or so of which two weeks with my six-year-old son in Tenerife, I decided that I will never go back to work in that organisation because of what the rest of the owners, the equal ownership owners, had decided and how they handled the process. And, because I thought that the ideas that the COO I had brought to the company were stupid, to be honest. They were not something that I had any belief in. They were also somewhat unethical. I just thought that I have to stick with my ethical principles and still be able to see myself in the mirror every morning. I have to do something. Then in early 2007, I said that guys, now you can purchase my shares and I will leave the company.
Petri: Let me recap. You recruited a COO and then the other founders, the other shareholders, started to get some ideas that may be you need to be replaced. How did that make you feel?
Jaakko: When I realised that I thought it is something temporary and goes away. But it didn’t. And then I started talking about sharing my thoughts with the rest of the founders. The dynamics in the founders, we were five and had equal ownership, but the dynamics were such that there were two more dominating personalities amongst the five of us. I was the other one and then there was another person. I started discussing with the other person a lot. With the rest of them some discussions, but with this guy, quite a lot and we ended up in endless discussions about what should be done, what has been done.
As my style in the leader positions is that I don’t keep my opinions only to myself. I say them aloud and people know what I think about things. What I like, what I don’t like about then, of course, in that type of discussions all the old disagreements and the pain point, everything from the previous seven years started bubbling. First bubbling under and then coming to the surface. That was a terrible time I had.
I believe that we all had a terrible time in 2006, the second and third quarter, and maybe also the fourth quarter. No one wanted it, but somehow we ended up fighting and for me, that was terrible. I thought that the guys had sold their ethical standpoints to a new person who had been there only for a couple of months.
And they had somehow forgotten our successful history of building an internationalising company with only the customers’ money. And I thought that was terrible. I also believe that they didn’t like it, but they had made their opinion.
Then it was myself and the other dominating guy against each other. Even today, when we meet very, very rarely, but when we meet we don’t invite ourselves to visit our families or homes. Which reminds me again, this is a funny story from maybe five years back.
One of the founders, I met him in a Slush evening meeting, and I believe that he had been drinking a little and he came to me and we hugged. We were happily discussinghow life is great. It is a pity that we haven’t met with our families for so long and we should do that.
Why don’t we invite you to our house and great to establish the relationship again and everything? I thought, okay, this is nice. Now, we can fix all the broken relationships. Then it was funny, the next week, I don’t know what type of thing happened, but I happened to see him giving a speech about what had happened in Idean and what kind of growth story it had. He was lying to the camera and the live audience and recording about how everything started and who there were. He had left me out of everything. I couldn’t do anything but laugh. But then I sent him an email saying, Hey, we just met the previous week and we had this great time, 20 minutes. We decided that we should meet with our families soon again, and now you betray at least me in front of the audience. Why do you do this? He never replied. I think that’s a very poor thing for anyone to do. It’s not a very courageous thing to do. I can’t see why, but I’ve also noticed that in quite many stories that have been given about how Idean started, what has happened and how the success story really built itself, so to speak. They have systematically left me out.
I don’t care about it anymore, but I feel a little sorry for them. For us, four original, and then the fifth equal owner who were such a unified core team doing everything together. And then something happened then and one of them which happened to be me, but I’m afraid it could have been anyone else.
Then the person is non-existent also from the past. But I think the story is so good that if they decided they would have made a good story or of it. We had an early CEO who was able to grow the company up to that point when we hired the CEO which didn’t work so well. They had to actually fire the new CEO about a year after they had hired him first because his ideas were terrible and they didn’t work well at all.
But then with the last funding the company had, one of the original founders went to the United States and started business there. And then it really boomed everything, and the rest is history. I think it would have been a good story written like that, or spoken out like that.
Petri: What’s there anything, you obviously have been thinking this quite a lot, I would imagine. Was there any sort of warning signs? So if there’s someone in the audience who was thinking that, okay, Hey, I’m the CEO. I’ve been here like five years, six years. And is there something I should be worried about?
Jaakko: Good question. This is where it comes to the equal ownership structure. These types of things cannot happen easily if there is someone, one person, no matter who, if there’s one person who has the final say in everything. But if there’s an intervention coming externally, someone can make a great sales pitch. Some smaller group of owners buys the stories and the ownership structure allows it, then this kind of thing can happen. The warning signs that I noticed were that the COO, whom I thought I knew from the leisure life and from his previous corporations he had worked in, also started to act a little bit differently towards me and towards the rest of the owners quite soon after he had been in the company.
And that should be noted and should be cleared out immediately when in the management position, in an executive position in the company, you notice that your almost peer person who is in a key position, starts acting weirdly. There’s always a reason for that. You should talk about that before things like the processes I mentioned happen.
Petri: You mentioned in the beginning, you agreed that maybe there’s a need for a new CEO and you find some other role in the company and that’s perfectly okay. So that was not the case. I guess the company was already seven years going and it was like that we’ve been achieving quite a lot, so maybe we need some changes and shift gears.
And you also mentioned that there was some turmoil and something did not exactly go as planned. There was probably stuff happening underneath and just any change is better than no change. Then there was an opportunity which sort of emerged, and it took this shape.
Jaakko: Yes. In the beginning, I couldn’t even imagine that they would like to have a new CEO in the company. But when I realised that it was really difficult for me to swallow the idea that I’m not the best CEO in the company. But after long discussions with myself and the rest of the owners, I just thought that, Hey, that can happen, but I need a sabbatical first.
And then when I come back, let’s see what I can do. I had been responsible for the biggest customer that we had, Nokia, from the beginning and I can’t remember what, but I guess that it was even in 2006 about 50% of the total revenues. I thought that I’m still needed there and there were things that I could do. I couldn’t imagine it, but when I realised that I thought that a change in the dynamics, in the roles, is needed and I was okay with that.
Petri: What happened next? You left.
Jaakko: Yes, I left. I left the building and later in 2007, I started a company called Solutions Space. In less than six months, we opened a branch in Shanghai. I had some network there who were willing to buy our services, which were different from what what we had in Idean. Then in 2008, we opened an office in Japan, in Tokyo.
Petri: How did you structure the new company? You were the only founder and did you get some investment money or how did you get that started?
Jaakko: At the beginning that was one of the principles that I have. I will not own less than 50 per cent of a company if I’m the CEO responsible there. I had two other guys who are co-founders with me. They had 20 per cent in total, I believe. I had 80 per cent in the beginning. We didn’t have any external money before we had our first angel investor coming in.
Maybe that was in late 2007 or 2008. He invested some money and he had also good connections everywhere. He became the chairman of the board and everything went quite nicely there. Soon, we had customers and we decided to start growing the business.
Petri: What did you exactly do?
Jaakko: Even in Idean, I had this idea that there are big companies who especially, during those years, they did a lot of market research and user research for the products and services and business and business models and everything internationally, if not globally. And they didn’t do that systematically. They had consultants travelling from one location to the next location, doing the interviews, the studies there. And then after that to the third, fourth and fifth location, and maybe before they had gathered all the data from the markets and the interviewed all the users they want it. And after those two, three, four weeks, they came back, started doing the research report. Maybe two months after starting the project the customer had had the report and suggestions and everything.
And I thought that that could be done differently. And I started building in Solutions Space a network of independent agencies in different places who could gather the data in a well-thought out environment, almost like a lab type of environment. They would have the research subjects users or consumers ready and, and the customers could simultaneously operate the research project at the same time in different locations so that they could reduce the time, the throughput time of a project from two months to one week or so.
That’s what we started to build in the first place in Solutions Space in 2007. Then I sold that idea to some customers and started drafting software that would support that type of data gathering and also the management of the agencies even from the sourcing perspective and the qualitative aspects were all considered there. And then I went pitching the idea to Nokia and they thought that’s a great idea.
They invested some money into the software development and we piloted it in three continents and the results were great. I thought that, okay, this is a good business. Then I made them an offer for the next years. They said verbally to me that, yes, this is great. Let’s do this.
But unfortunately, that was the month when Nokia crashed in mobile phones totally. Maybe that was even the month when Stephen Elop had had his burning platform speech or the letter for all the people there. Even though it was verbally accepted already, the offer never realised. That was sort of a black swan for the business development at the time.
Petri: Did you pivot the business, fold it, or what happened?
Jaakko: I pivoted it after that. First, actually after realising that this will not happen with Nokia, I went to all the big mobile phone manufacturers and I visited them and said, Hey, we have this ready-made software for you for this purpose. And it has this type of data gathering methodology as part of it implemented it so that you can just take it in use and you will reduce the amount of time spent in this and this much and the amount of money with the sourcing elements it had and everything.
They said, Hey, this is a great idea, but we don’t follow the same methodology. They never accepted it, to my disappointment. That is, by the way, one of the learnings that you have asked previously: do not ever trust one single company as your customer too much. Have always backup plans and have something else boiling or sell it to other customers at the same time.
Because if that one company fails for some reason, external reason, like in that case, victorious Nokia mobile phone manufacturing globally crashed, then your business is part of the collateral damages.
Petri: Recently, when COVID hit, you were also doing a bit of a transformation, not pivot but a transformation from direct sales to online sales. Can you walk us through how did that go? And was there something for other people to learn?
Jaakko: Just to start with that is by the way, the same original company that was doing the software for Nokia. I pivoted it after the Nokia crash and we started doing online communities. It was easy to pivot the business into online communities because maybe 50 per cent of what we have there in the software were usable for these different online communities where you can ask different stakeholders to join a community.
There you can do innovation or testing or marketing inside gathering projects together with them with full interaction methods and you can analyse everything. We pivoted it into that direction. Well, we had to rewrite a lot of the code, but then we had quite good business starting about a year ago in early 2020.
We had many big, good companies who already had, or were about to start online communities with our saas software. But then the COVID happened and it became evident that the few big companies that I had been able to make the relationship with the big direct sales type of methodology were not enough.
Some of them passed the opportunity to start working with us, even though they had already said that, yes, let’s do this, but when the COVID hit, it hit also the big companies and they didn’t want to start anything new there. After analysing what had happened and what COVID or the pandemic does for the sales and for the company, I decided that now we need to change our sales model in full.
We went from direct sales, which had been enough into digital sales. I thought that, okay, it’s easy. It’s simple. Let’s start doing sales with more volumes. Of course, the devil lies in the details and it was not that simple and easy. We had to change everything. As an example in direct sales what you need to do is that you need to take care of your customers in sort of the old fashioned way. Just making sure that everything is right and they know everything that they need and they can do with your services. Everything that they want to do and oversee that the chemistry is okay.
But in digital sales where the volumes are higher, even if they are not higher, you need to take care of the processes, the digital processes that the customers are utilising: starting a new customer relationship or maintaining your customer relationship. When it is more in digital channels, whether it’s on one or multichannel process you have to focus a lot more on them and you have to organise your sales team, customer support team and customer care team around the digital sales processes. For me, who had been doing direct sales for the last 20 years, it was surprisingly different from what I had experienced and what I knew well to go towards digital sales.
Petri: What was the most painful thing and what was a nice surprise you didn’t expect to happen?
Jaakko: I think the most painful thing that there was is changing the culture from direct sales and only a few customers taking care of a few customers, knowing them well and their account managers or whatever they have there in the team, changing that culture towards higher volumes towards digital processes and then managing the digital processes.
The biggest nice surprise that I think came from that is the metrics. You can measure almost everything there. Every action that you do in your sales team, every transaction the customer has with your software. You can even develop different automatic processes. If a customer does something in their software, you can start an automatic process that takes care of that.
Asking what they could do better or taking care of that they can solve whatever that they have been doing there. The most painful in summary is taking care of the people, the change, the culture, and the nicest surprise is how measurable everything in the digital world is.
Petri: Before we went online, we also discussed this and you mentioned that it’s simple, but it’s not really actually simple. Can you remind me and tell the audience what was the simple part and what was the complex part?
Jaakko: Well, the simple part was to announce that now we go from direct sales to a more digital sales mode. But the difficulties become there when we have to decide about the details. How to organise everything, how to manage sales teams’ daily actions, how to create the reporting, how to set up the goals, the sales goals with contacting goals, objectives towards the customer success.
It’s always that conceptually you can announce things easily, but when it comes to the details, even with this, at least, conceptually simple thing of going from direct sales towards digital sales. The amount of details is surprisingly big and you’d have to do things systematically.
We started the process, the change process in maybe February last year. We ended up doing many things better by the end of August but in September, or maybe it was October we decided that we will start cooperating systematically with a company who does nothing but digital sales and digital marketing. We have learned how to do things systematically. Everything that you do, you need to A/ B test, which one is better.
Don’t use your emotions, use the data to always go with the better one and always have something for the A/B testing process. This company whom we have worked with is called Digital Boost 360. The founder is called Mika Heikinheimo, who is a serial entrepreneur. His personality is “cut the bullshit and do the work, execute it immediately” type of personality.
It’s very systemic. You have to do small steps. You have to focus on the smallest details but do it always. Do something every day. Even if the step is very short or baby step, if you do it for six months, if you do it for several years, you end up in a successful business. That’s what we’ve been practising now for a bit more than one year. We see the results. We even have contacts from companies and organisations that we have not even heard of. People read our newsletters quite much. They go into our recently renewed website and they read the blogs.
They do things that we hope them to do. They even reserve time from my or our sales persons’ calendars to get a demo. The volumes are slowly, in my opinion, but they are getting higher every month. I believe it is only because now we are doing things systematically. We focus on the details and we try to improve our digital sales methodology every day and every week.
Petri: What happens when we can fly again and travel and do basically say direct sales, do you change anything?
Jaakko: I don’t like to say that I will return back to direct sales or I will not do direct sales at all. I think that we will focus a lot on digital sales and do it even better every week, also in the future. We can most likely, if everything goes fine, we can start doing digital sales elsewhere from Finland, maybe at the end of this year, in six months, if everything goes fine. My understanding is that it will not happen with direct sales anymore. There will be a need to meet people face-to-face in some locations. I don’t yet know how I will structure digital sales in the future for international business. But I guess that it will be with the digital sales methodology that we now have: scaling the volumes. Even nowadays you can focus on certain areas with your critical marketing efforts and sales efforts and I believe that’s definitely the only way, almost the only way to go for us in the future.
Petri: How do you see the role of communities in business nowadays? Is it a competitive advantage? I was just reading David Spinks’ new book called The Business of Belonging, which just came out a few weeks ago and he talked about how to build businesses or how to build communities. He sees a lot of similarities between them that you have to treat your community as a business in the sense that it needs to be self-sustaining in order to thrive, it needs resources and dedication. It is more like a startup when you’re starting it.
Similarly, a company, when you start it, it’s like a community. You have a mission, you have a purpose, and then you’re rallying people around you. Then you start to build from there. You need resources as well. It’s not that much different, but when you already have a big company or you already have an ongoing business, you can still have a lot of these things and involve people. What are your thoughts on this matter?
Jaakko: Utilising online communities in the Finnish business climate is very poor. There are not many companies who have done it successfully and who know what to do with it. I would say that almost the only companies who do it well in Finland are some of the big consumer companies who just have so huge volumes that if they decide to start a community, there’s always some 10 or 20 per cent of their consumer customers who will join it. And of that amount, there are maybe 10 or 15 per cent who are active there.
To build a successful community online you need to act as a startup. It is definitely like that, but that is not the only perspective in the online communities. You might have an online community for, let’s say, research and development purposes.
It is more like you tell about your new features and new products and people give their feedback and you can do some testing and you can do some development and maybe even some product innovation with your crowd or with your community. You could have a more sales and marketing oriented online community where people get to see your latest fancy innovations. Maybe if they take part in that type of online community they receive something as incentives to be the first to purchase them. If you want to do it well, you need to…that’s, by the way, something that we have built into our community methodology, you need to have the purpose and the mission.
You need to know what you want to do with your online community. Then you need to organise your ideas, the themes in the community accordingly. You need to have there people who in the beginning create the content that is needed and who create the first interactivity for the smaller group that definitely, in the beginning, you have there in the community.
You need to have someone who is overseeing the online community from, let’s say, a startup entrepreneur’s perspective and trying to understand where are the trends, where are the most active discussions, how could I utilise them? Where are the next opportunities? Where I can go to and how I can build on something that has been brought up by a community member and how I can grab the idea and just utilise that for the core purpose that I have and the mission that I have in the community.
That’s probably one of the biggest reasons why many online communities fail. They don’t realise that they need to do their homework, so to speak, or the business plan for the online community in the beginning, when they start it.
Petri: You also have been founding another company just recently. You said that you paid a lot of attention to the values and that it is based on proper values. Can you elaborate on what you meant by that?
Jaakko: I had to go back to the design industry. I’m fascinated by the design industry. I’m not a designer myself, but I value a good, great design and the designers and great products and designs that work for me and they look nice and they are easy to use and so forth. I have been in different industries for almost 10 years.
Then I had an opportunity to start a new business with a friend of mine who was one of my first customers in Nokia about 20 years ago. In his personal life, he had an opportunity to do something new and he wanted to do something new and then we ended up discussing the new idea of an ethically sustainable design company business model.
After some sessions, we decided to found one by ourselves. There are some principles that we would like to follow in this Alpha Design Partners company. One of them is that we should never do anything that is not good for us and for the customer. We have seen also design consultancies or agencies, who come, sell, make a great sales pitch, execute the project.
Once they have ended the project they leave and then the customer is left without any support and they should start implementing the new designs. It’s not a rare thing that the new design is shining and polished, but it has some elements that are difficult if not impossible to implement into the product.
That’s one of the things. Then from the consultancy professionals or the designers’ perspective, if they’re working in an agency it’s not really rewarding in the long-term if you do a project. You get excited, you get yourself and the team energised about doing yet another project, and then you do it with a huge amount of energy, a couple of weeks or months. Then when everything is ready to be implemented from your perspective, you leave and you’re starting another project.
We decided to change that structure a bit and it has worked well. We have already in these few months interesting both domestic and international customers and we are doing not only the fine-tuning of visible user interface elements or the pixels perfect stuff, but we are also doing a little bit more deep changes for our customers. Maybe the service structure or the product structure, and we are helping them to do a transformation towards a more modern style of design operations and design teams management.
It’s very interesting. I believe that the learnings I took from Idean at the time. The experiences coming from Solutions Space in Asia. We did also some design-related stuff there. Then building my own software company business. They all somehow come together in this new Alpha Design Partners venture that we have. So, it’s interesting. It’s really interesting.
Petri: What is your favourite word?
Jaakko: I guess that I have mentioned it many times here. It’s probably for sure.
Petri: What is your least favourite word?
Jaakko: I don’t like world-class. I don’t like that at all. I think it doesn’t mean anything. World-class doesn’t mean anything. And for different reasons, I don’t like the word, honestly. Those are probably the two least favourite words.
Petri: What turns you on creatively, spiritually, or emotionally?
Jaakko: What turns me on, I think that the moments and eras of creating something new that solves a big problem that relates to many people.
Petri: What turns you off?
Jaakko: That’s easy. It’s two-folded. The other one is proofless negativism and the other one is backstabbing.
Petri: What is your favourite curse word?
Jaakko: There are many. I’m a heavy user of curse words. I use them on different occasions in different tones, but should I have only one?
Petri: Pick your most favourite one.
Jaakko: I guess that I use perkele a lot.
Petri: Can you tell what it means for the English speaking audience?
Jaakko: It’s the devil.
Petri: What sound or noise do you love?
Jaakko: At least something that I have now wanted to hear more is team sports, indoor teams sports noise. And the other one that I like more and more is silence.
Petri: What sound or noise do you hate?
Jaakko: Speed camera flash. It doesn’t probably make any sound into the car, but it is something that I had as a concept. It’s terrible.
Petri: What profession, other than your own, would you like to attempt?
Jaakko: I’ve always enjoyed writing. I have always enjoyed travelling and getting to know new people and new cultures. I would say that it would be some type of nomad journalist. I don’t know if there is a profession for that.
Petri: What profession would you not like to do?
Jaakko: Politician. Definitely not a politician. I’ve seen and I know some politicians and political organisations and that is a game I would not like to be involved with. Probably, if you listen to this interview from the beginning, you understand the reasons.
Petri: If you could be a co-founder of any startup in any era, which one would you choose?
Jaakko: That’s not an easy answer. That’s definitely not an easy one to answer. I would like to be in a startup company that would preach and practise some kind of expertise of versatile thinking skills. It would probably go somewhere…an easy answer would be religion, but I’m not a religious person. And I don’t like them so much. So, I wouldn’t say a church, but something that would help people in developing their thinking skills.
Petri: Any final words for the audience?
Jaakko: I think that being an entrepreneur is one of the best things a person can do. At least, as a style of living it’s exceptional to many others. You can experience the worst and the best parts of life during one day. And you can be part of them. For me, it’s really intriguing and fascinating.