The Story Behind Elfsquad

Could You Tell Us Something About Your Educational and Professional Career Before You Founded Elfsquad?

Next to the course I followed (Operations and Supply Chain Management), I worked at various manufacturing businesses. As an employee at first and as a freelancer later on. There, I worked with internal business processes. My specialty was to make businesses work more order-driven. It sounds so simple: you only start with the process of engineering, purchasing, and production when there is actual customer demand. The harsh reality is different. As an SME you have to get around with limited resources. Think of legacy (outdated) IT systems you cannot easily get rid of. While the connection with the (very-quickly) changing world stays behind. That hole presented enormous opportunities, and we dove in head-first.

From a young age, I wanted to become an entrepreneur. My ambitions lay somewhere else other than taking over my parents’ butcher shop, and as a freelancer I did not feel like an entrepreneur. With this background, I was looking for a way to use my knowledge to help companies. I enjoy (creative) freedom and gain energy from a community of customers, colleagues, and advisors that share the same vision, with me behind them.

What Did You Develop Your CPQ Solution?

As a user, I experienced the detriments of legacy IT systems firsthand. This software was developed at a time when the internet did not yet exist. And was focused on internal users. These internal users were back-office employees, mostly belonging to Generation X. On top of that, the software usually wasn’t supplied by the software builders themselves, but by consultants with a revenue model based on consultancy and customization.

CPQ software also belongs in that category. Not only is it very expensive to implement, but you're dependent on consultancy and customization to optimally use the software. That's not beneficial for the user experience at all. Employees who are brand new on the job market are confronted with IT systems that require them to click through 10 screens to adjust something simple. This generation is forced to ring up a consultant while they expect a YouTube video. All this while, by 2025, 75% of the workforce will consist of millennials.
Next to ease of use for internal use, a connection with external parties was lacking. We all find it very normal that we're able to compose a BMW on the internet, visually changing all possible options in the process. But when you're looking to purchase an agricultural machine, a salesperson needs to explain that you do indeed need a stainless steel ridging hood from a thick catalog with old pictures and faulty prices.

That consequently someone has to re-type the entire received orders is a whole different thought than having customers and salespeople fill in orders themselves. Without customization, there wouldn't be a standard solution offering something as valuable as that.

At the time, we started looking around to see if more businesses ran into these problems. From this point on, the ball started to roll, and we eventually decided to build our own CPQ solution.

What Is the Importance of API-First?

Most business systems are developed from an ‘all-in-one’ idea. With these big packages, you gain the possibility to handle a lot of things: from purchases to planning, and from relation management to production. Because such a package has to support a large amount of different processes and types of businesses, you end up with a massive number of settings. On top of that, it seems more customization is needed because the logistical process falls just outside of the standard solution.

Since we all went online, a countermovement began to show. More and more specialized tools have become available, small portions of software that are incredibly good at supporting one of these business processes. Elfsquad is a good example. We create ‘best-of-breed’ software. Preferably as small as possible, so that we can be the very best at what we do.

Moreover, we're not the only ones with this thought. In the past 5 years, more applications have been developed than the 40 years prior. This has caused a more fractured IT landscape, where many different applications have to communicate with each other. Who is going to create and maintain all of these connections? The development of all these small applications is causing a larger (and already chronic) shortage of programming capacity. So programmers won’t be doing it.

From the very beginning of Elfsquad, we kept this issue in mind. The solution is that you as a user should be able to link the API of one tool to the API of another. And for that, you need the right people. So when you choose Elfsquad, you choose to employ or educate people for this. People who are technically able to link everything you need, now and in the future. Luckily, these future employees are likely already at your door. ‘The workforce of the future’ means the technologically savvy young employees that expect and know no less than best-of-breed. They are used to doing research themselves and building connections through low-code platforms.

Elfsquad as a Startup: How Did the First Years of the Company Go?

In the beginning, we only had a vision. No product yet. People bought our product because they trusted us, and me, personally. This also counted for the people who made the first financing possible. Fred Sterk and Rene Boeijenga, who simultaneously served as Advisory Board. Together with Johannes, I started back then. In the very beginning, we were situated in a tiny office on the Berglaan in Drachten, where Johannes often was found programming by himself, for days on end. Including during weekends and holidays. I remember that at some point Johannes suggested programming in an environment with people around him on some days, in the corner of a restaurant for instance. As it was very quiet in the office.

Shortly after this start-up phase, we entered a less-pleasant period. In the media, you often hear success stories of big companies like Facebook and Google, but they do not explain that it's extraordinarily tough. We do not make simple software. Especially with investors and customers who invested in you based on trust, this creates a constant (passive) performance pressure. Eventually, this made it possible for us to create a very clean and solid product in a very short time. I do believe that pressure is required to make that happen. But I would not romanticize this period.

When we were running our product at ten or so customers, the real fun started. For people to not only adopt the vision but also adopt and appreciate the product was a true turning point. And since that point, we constantly kept on growing. In 2019 a second turning point came around; we paid off our debts and adjusted our name and branding to Elfsquad. In 2020 we doubled our revenue, and in 2021 we already have again.

What Are You Proud of?

I am very proud of the people who work here. We have a talented club and brilliant customers and partners. I see that the people who work with us truly breathe the vision that I had in the very beginning. I also notice the creativity, ambition level, and ownership in them. Not only in my colleagues but also in our customers and partners. This is what I gain the most energy from. We started this journey together and I would love to finish this journey along with our customers, partners, and all of the employees.