Hardskills has been compared to Netflix because you’re creating binge-worthy content using real actors and real-life situations. Would you call this reality TV for the corporate world? Why is it so different from other corporate learning platforms?
When we decided to build Hardskills, or to go into this market opportunity, we were really looking at what had already happened. The online learning revolution, in the Khan Academy, Udemy, Coursera or Udacity, they were literally pointing a camera at a talking head. If you go back in history, you will see that when movies first came, they replicated theaters, because that was the platform that was there before movies reinvented what a movie is. We saw that same opportunity with corporate learning because most of corporate learning was very boring.
It was very exclusive, because it was physical, in person. For example, Germany is very decentralized, there are multi-billion dollar companies in the middle of nowhere. So a lot of training is dependent on talent and trainers near them. What if we brought the work situation onto people’s screens? That was really the genesis of the idea. How can we bring this to life? We came on the idea of using professional actors because of the engagement. When we looked at learning options on the market, it was actual experts – subject matter experts – training you.
We said, what if we do something different? Why don’t we take the expertise of the subject matter experts and marry it with the art and expertise of people who are trained and have a talent to engage. So that really is the thing that sets Hardskills apart.
I want to stay on this point and hear your thoughts about how COVID has changed the approach to remote learning, and your business as well.
COVID has shone a light on remote learning. It’s been an accelerator.
It’s really the behavioral and leadership skills that were clinging on to the in-person scenarios. So COVID forced people to say, I can’t not have training. So I’ll just sign up to LinkedIn learning or some other 20,000 live course library. And I’ve checked the box.
I can tell my boss, we have an online learning strategy. But in the last four to five months, people are realising that serving up 20,000 – 30,000 courses, just going online in itself isn’t necessarily the end game. You can bring the horse to water, but you can’t you make it drink. People will only engage if they see something in it for themselves or if they enjoy it and it’s got that addictive feel. I think next year people will be more selective. Senior executives are learning to ask the right questions. I think ROI will become a much, much bigger deal because what’s happened with COVID is that there has been a land grab by the big online learning libraries. If you look at Udemy that just went public and you look at their filings, you will see that they talk a lot about the explosion in the corporate training business. There has been a land grab where they go to companies and they say for a couple of bucks per person, you can buy an enterprise license. I think companies are going to stop defaulting to that. It’s like all of us take out a gym membership, or we might have a membership to a language learning app, but often it’s that personal trainer or some other cycling class that we have to layer on. I think that’s what you’re going to see in the next 12 months as a result of COVID. People are going to be more discerning.
Your net promoter scores are very high but how do you measure the ROI of a training program? How are you convincing executives at the decision-making level to sign up?
The net promoter score is an important indicator because every single employee of a company that completes the training rates us. We don’t just select a subset.
The second aspect is because we are running at an average course completion rate of 94%, it means pretty much everyone who’s enrolled is completing and consequently almost everyone who’s completed contributes to the NPS. I think initially we won business from companies that had a problem to solve.
Our first customer was a company out of India called HCL Technologies that had 125,000 people when they began working with us two years ago. Now they have 165,000. So their challenge was how to train a large distributed workforce. They have people in Latvia, Lithuania, Mexico, Bombay, Waldorf, probably. So they needed a solution. The first generation of clients were the early adopters; they had a problem and they said, let’s try, it sounds logical. We don’t know if it’s good. We don’t know if people are going to love it, but let’s try it. Then you had the second generation of people who intellectually connected with the idea of training behavioural skills at scale. By that, I mean, if you sit down and think about it, training good communication skills to just 10% of your population isn’t going to move the needle and historically behavioral and leadership training has been a very exclusive thing.
If you’re not going to meet the customer, why do you need to know how to communicate or present? That competency-based mentality is still there. But I think the second wave of people, like Sindu Gangadharan (MD, SAP Labs India) said this makes sense. I want to try it for a lot of people because they are leaders who are change agents. The great resignation is a huge undercurrent because it means people really can’t just have lip service about learning opportunities for their teams. They have to make sure they are offering their people a reason to stay.
A lot of the great resignation is staff that are valuable. It’s the tech talent because they have negotiation power. If you look at the tech talent and you go, what are skills that the tech talent don’t have that I can give them. That really is people management skills, communication skills. A lot of people in tech traditionally didn’t value those skills. But I think that’s changing. We often hear engineers say, what I really like is I now feel I can communicate my ideas. I have a lot of ideas and I have been able to communicate them.
I want to hear more about you as an entrepreneur and how big Hardskills is at the moment, in terms of staff and contractors?
Twenty people. Most of the growth has happened post COVID, so after June, July 2020. If you had asked me two years ago, ‘would you have hired someone that you had never met in person’, I would have said no. We have a policy that all three co-founders interview every candidate, because it is the DNA, it’s the foundation of the business. But we have not only hired a dozen people that we have never met in person and still haven’t met, we’ve also hired our first ever member of the management team and we hired him without meeting him in person.
Here’s the question I want to get to – balancing quality and growth. What would you not sacrifice on that journey?
I saw that question and I smiled. It’s a question that you think about a lot and the world we live in, the startup world or the early stage or the innovation world, really puts a premium on speed, and growth is another word for speed. It’s very hard when you are in a universe that values or places the biggest premium on growth to be a naysayer or to go against that grain. My response to that question is, the most important thing is getting the product right, getting a product that delivers and exceeds expectations on the promise. All of that is quality.
Until you get to a certain stage, you have to not be prepared to deviate from quality and customer promise. At some point after that, you do need to pay attention to growth and I think the lesson that I’ve learned mostly by observation really, and some by mistakes that we’ve made in other companies is you can grow too fast for your own good. We certainly had an instance in our last startup where we hired 18 salespeople in one year. Not a good idea, because we didn’t have enough time to absorb and get people to the next level.
Were you self-funded or do you have investors to report to?
We have investors. We did self-fund our whole MVP (minimum viable product) phase, and generated revenues from that. We had a product that we were selling and we had customers, and then we brought in some angel investors. Today we have about 15 angel investors and we have one institutional investor, which is part of the Draper Venture Network.
A lot of start ups think if I had the money, I’ll be able to get my product market fit, get my messaging and get the right people. I think it’s a lot more exacting to actually have some capital constraints in the early years, because it really hones the decision-making as an entrepreneur. You can’t afford any screw ups. You have to really think about, do I need this? Is this the right path? Next year I think it will be at the right stage for some growth capital.
Do you have an exit strategy or do you do worry about founder dependence or how do you and your co-founders think about that?
This is our third enterprise as a founder group. So we have understood and tasted the excitement of going from nothing, from idea to test, to revenue, to grow, to exit. We find that exciting as an idea and if we didn’t we wouldn’t have gone out and gotten investors. Because there’s an implicit understanding that investors get a return and it’s not a return in 20 years. It’s a return in plus or minus ten years. We’ve been commercial now for three years. Do we plan on exit? Yes. Do we spend time thinking about an exit? Not yet in terms of planning for it, because really there’s the scaling to do.
What do you stand for, what you want your legacy to be.
It is very exciting to think you’re doing something that’s going to change the status quo. I want to go to bed at night, being very happy with the work that I’ve done that day. I remember as a journalist, when I first started in Dow Jones in New York, I would hit the send button and then it would go into the whole system. I would have sleepless nights because, what if I got that one detail wrong? That ethos of ‘I’ve got to end every day, knowing this was something I can wake up to and not be disturbed at night about’ is something that still drives me. That bleeds into everything else including quality and growth.
Last question. Which world leaders or executives or public figures do you admire.
A very current person that I admire a lot is Angela Merkel. As an entrepreneur, I appreciate people from other fields. I love the way she has stood for her own values. She’s unfazed. She doesn’t blow in the wind and most politicians and statesmen blow in the wind, but she has guts to do what she believes in. I admire that quality and I think she manifests it really well.
Today it’s hard not to find a new hero every day. I certainly have a lot of admiration for people in the healthcare field in the last few months. A lot of the health tech and the biotech stuff that’s coming out is exciting. The next area for me would be the whole cybersecurity field. I think cyber security is a real human threat.