LONGREAD – In March, Viacom announced its partnership with Dutch startup Vigour, describing the product of their partnership as an “industry first.”
Vigour’s technology facilitates a multiscreen viewing experience, transcending the one-screen model to yield simultaneous content consumption across devices. Given Vigour’s functionality, it’s no surprise they ultimately partnered and launched with a content provider, though allying with one of the biggest media companies in the world makes their story a triumphant one and of particular interest to European startups looking to prosper and enter a global market.
To better understand the cultivation, development, and implications of such a partnership, StartupJuncture partner FuelUp chatted with Ramon Duivenvoorden, CEO of Vigour, to get a firsthand account of what it means to enter the big leagues.
You’ve been doing this for a bit now, are you now at the stage of scaling up?
The sales cycle within our industry is huge but once you start growing, you just grow. We have the first live product out now, so there’s lot of stuff going on. We are not only allying with a customer, but at the same time with a huge group of people in multiple European countries.
Is the partnership with MTV a global one or EU-based?
It’s hard to say in the sense now we’re now live in a group of countries in EU, but we are planning to eventually roll out to other territories in other parts of the world.
So is Viacom your first customer or your first big customer?
I wouldn’t say they’re our first customer, but they are the first real commercial roll-out of our technology. We’ve worked with other customers on smaller non-commercial or internal projects, but this the first time our product is really hitting the market in the way we intended it.
This collaboration is being called a ‘partnership’ but is this really an unique and exclusive kind of partnership or is this just a big multi-market deal?
When you work with big companies like this, there’s a huge investment in the relationship. Obviously we are a very small company compared to Viacom. But on the other hand, they invest money in us, a lot of time, and resources as well. And they have a large group of people using our products, so any kind of multi market roll-out or customer relationship easily becomes a partnership in a certain way.
When you work with big companies like this, there’s a huge investment in the relationship
So how long did it take from initial pitching to having a partnership and moving forward?
I think it took more than a year. It’s always hard to say from when you first pitched to the following meeting and the moment we went live, but that was probably about a year and a half. And then from when we kind of finished the pilot to when we pushed the product live, that was a little bit more than a year, I guess.
Did you already have a prototype in the market when you first started talking with MTV?
No, actually, we have a self-built prototype. It was not in the market at all. We got introduced to Viacom through a shared connection with one of their directors. It’s all about finding the right people that you have chemistry with. When we showed it to the person who at that time was responsible for their previous product, he instantly got it and he’s like, “wow, let’s do something.” It’s all about building a relationship with people.
Was that kind of the intention, when you first started building it out, that you would launch it with your first partner or were you first thinking introduce it market by market?
We always had a clear strategy, knowing that we have a technology that is very unique in the market and that there was a lot of interest. We were very small, but we knew that when we would implement the technology, we would want it to do it with the partner that would provide the right weight, right story and the right signal to the industry. We could have done it with a smaller local European player, but nobody would really care about it.
One of the things you quickly learn is that everybody knows that working with Viacom makes what you’re doing interesting because they are one of the biggest media companies in the world. We always knew that we would not be able to scale from day 1, but working with one of best partners in the industry helps you to really get the tech right, the story right, and test on a very large scale before rolling out industry wide.
How long have you guys been working on this technology? Can you elaborate on the journey to develop it?
We first started building the foundation for the technology during an innovation project with KPN, which is the biggest operator in the Netherlands. It’s like this typical story of couple of guys somewhere in the back room just being asked to join a project. We spent a couples of months building a technology that would cross different screens in households. Media consumption has been shifting gradually and what we were doing for KPN was from, technical point of view, helping them create an interface that would cross from the TV to a tablet to a phone to a computer, while maintaining the traditional way of how people view content on a TV screen, just across any screen they choose. Throughout that process we developed our own tech to it – it was a couple of years ago, so that was still pretty hard. We became intrigued by not only the idea of content on multiple screens but actually using the unique capabilities of every screen in a way that would bring in a whole additional group of people.
It’s like this typical story of couple of guys somewhere in the back room just being asked to join a project
We wanted to keep initially developing that within KPN but we got to a point where some complications arose. We became aware that by the time that the product would be out, all of the most interesting stuff could have been all taken out of it. So we took our technology to Berlin where we joined Startupbootcamp. From there we raised the investment with Deutsche Telekom and Dutch VC fund Linden Mobile and then things just happened. It was 2013 when we raised a round of €500.000 which at that point was like $650.0000. We used that funding to build our product layer and eventually landed pretty well, I would say.
How would you compare your experience with KPN to your experience with MTV?
The main difference is that when we were with KPN, we were working for them. When they hired us, they just saw us as a development company of a couple of guys who were really good at writing code, and by the time that Viacom had interacted with us, we were one of the biggest startups coming out of Startupbootcamp. We had just raised half a million euros from Deutsche Telekom, which is obviously one of the biggest name in the European media landscape, and we had a very clear idea of what the product was going to be and we sounded like we already had it, even though it wasn’t necessarily true.
They just saw us as a development company of a couple of guys who were really good at writing code
In that sense, by the time we started working with Viacom, we were still a small company and they were a huge company and we were in the position where we could really make them believe that working with us would benefit them by being the first mover in technology. We positioned it as, “we’re happy to give you the opportunity to be the first one in the industry to start this kind of stuff.” The core of business is storytelling in the sense that you need a good product, a good team–and we had all of that–but most of all, you need a good story, and by the time we got into Viacom, we had great story, I think, even if we didn’t have everything. They kind of had a feeling that, “this is a big opportunity for us as well.” Once you get the partnership based on that, then it’s up to you to get the job done.
Were you worried about getting your investment from Deutsche Telekom knowing that your product was meant for media, that you would have some kind of exclusivity?
No, honestly, they have been huge benefit for us because Deutsche Telekom, at least in Europe, is one of the biggest players. The fact that Deutsche Telekom was saying that this technology is so interesting that they want to have a long term stake in it, that’s your best sales argument. But also coming back to having a good sales story, we have a couple of really top people from the industry investing some money as angels as well. You try to do something really disruptive and you are trying to sell it to big companies and one thing that is most important for everyone is trust. And having a name like Deutsche Telekom behind your company and having top people from the industry saying “this is cool” creates momentum. Working with a small company is always a big risk and having the right network is the best way to take the risk away.
One thing that is most important for everyone is trust
I mean, when Viacom bought our product, we didn’t have the product finished, and when they invested a serious amount of money, there was no way that they could be sure that we could actually live up to our promises. And this kind of trust, based on “these guys have received investment from one of the biggest media companies in the world and they have a lot of top guys from the industry invested in the company,” that helps them want to do it.
From first getting it off the ground and getting the agreement, what are some of your learnings? What would you say to a startup looking into what you’ve done and tell them to focus on?
One of the biggest learnings is that if you want to get things done with big companies, you need to understand how it works, and it takes time, much more time than you think. So one the biggest mistakes that you make is thinking that if we all agree that it’s a good idea, why can’t we get it done tomorrow? It’s just not the way it works. You have to go through a certain way of doing things, things that take much longer than you want. And you really need to start to understand the internal politics to start getting things done.
Also it be quite frustrating being a small company, but once you understand it better, you can be more realistic about what can be done and if you understand it and you’ve shown that you understand it to your customers, they will also have more trust in you.
The other big learning is to find a sponsor within a company that you work with. It’s all about personal relationships, so finding the right sponsor – someone who really believes in you and who you can also make successful – can create a very powerful alliance within the larger company. After all, a large company is not a single entity, it’s just a huge group of people. It might be that you could have come in through a different way, but you might never have got anything done if you didn’t find the right person that has leverage within the company and the decision-making power to actually get something done. Without that, you wouldn’t get far.
A large company is not a single entity, it’s just a huge group of people
What has been the hardest thing to deal with in this entire process?
Things end up taking longer than you want and while you do that first integration you learn a lot. You just need to be patient and you need to stay aware of timing and push for the right timing. Because if you wait too long, shifts might happen within the organisation that might actually end up with your product never going live just because people change roles, etc. So you have to know what’s going on in the organisation, who are carrying out the project, what might be delaying the project and how we can play along with that. That is very important.
You just need to be patient and you need to stay aware of timing and push for the right timing
If this partnership never happened, where do you think you would be right now?
It’s hard to say, but if this partnership had not happened, we might have been in another partnership right now. I think that for us it’s always been really clear that we’re following the strategy that we always meant to by entering the industry with a bang. If you do something very disruptive, you have to make sure that from the first moment you get it introduced in the market, it should be approved at certain level. I truly also really believe in luck. It’s the same with getting your investment. It’s a lot of hard work and a bit of luck to run into the right people at the right moment. Maybe we would be bankrupt right now, or maybe we would have been better off. It’s always hard to tell.
What is your general aspiration for the company? Working with other major media companies or are you looking to eventually sell?
For me, it’s hard to say. I’m a true believer of the companies that are being created today with the aspiration of being sold is a very bad approach if you want to create long term value. The thing that really drives us is that we have an opportunity to work with the biggest companies on Earth and change their product offerings to millions of people. So you have this kind of playground where you actually have an impact on how millions of people do their day-to-day tasks and honestly for me now I’m just so focused on the potential that we have on the market and the interest that we have.
I believe that if you are able to make changes for the end users and you make them on a big scale, then either you sell your company or you become huge and whatever happens, happens, but we definitely don’t have the strategy to be acquired anytime soon.
This post was written by FuelUp, a startup whose online platform connects brands and startups. It originally appeared on their blog.
Photo credit: Vigour / Viacom