Name: Andy Hayler
Business name: Kalido
Type of business: Enterprise software
Many budding entrepreneurs find innovative ways to finance their venture when traditional funding options leave them frustrated. But, back in early 2001, Andy Hayler hit on a particularly novel way to fund his new business – he got his employers to provide the capital.While working at petroleum giant Shell, Hayler did what many successful entrepreneurs do – he found a gap in a particular market and went about exploiting it. What is fairly unusual is that Shell were happy to act as venture capitalists for his enterprise for two years, pumping a massive amount of money into his fledgling software firm, Kalido.
“Kalido is the leading provider of data warehouse lifecycle management,” explains Hayler. “The Kalido software allows organisations to understand their business performance better, This is achieved by automating the build and updates of their data warehouses (corporate stores of data for analysis) through a flexible design based on the technology I spotted.”
Shell, realising that they needed a system that monitored their vast storage of data, agreed to heavily invest in Kalido, allowing Hayler’s business to expand at a rate that would leave most entrepreneurs open-mouthed.
“The first funding round was $11 million to get the company going,” says Hayler. Yes, that’s right, $11 million – equivalent to just over £6 million.
“This was raised through an internal investment process at Shell, rather like an internal venture capital arrangement. It was always planned, after the initial incubation, to transfer ownership to venture capital firms, since software is not a core business of Shell.
“We went through a very similar process to raising external capital in terms of developing a robust business plan, defend assumptions and projections.
The early funding is hardest of all. Once we had the prototype then we could develop a credible business plan and show the benefits that could be made, not just write down financial projections.”
After writing an example model for a ‘guinea pig’ client, Hayler secured his funding before attracting another venture capitalist last summer, severing all ties with Shell.
The decision proved the right one, with Hayler able to attract big-name clients such as Cadbury Schweppes, Philips and Unilever. He now has offices in London and Massachusetts in the USA with sales operations in the US and France. Despite troubles in the dot com industry, Hayler hopes that revenues will grow 75 per cent annually.
Hayler’s route to success is certainly an unusual one for a British employee wanting to go it alone, although he insists that he had to work hard, identify a market to tap into and write business plans and projections - much like your average budding entrepreneur.
“Kalido was something of an unusual case in getting its initial funding from a large corporation,” Hayler admits. “However the principle of concentrating on a real, intractable customer problem, and developing software to directly address that need in partnership with customers, is one that would apply in all cases.”