Albeit brief, there are some moments in the careers of visionaries and leaders that afford them a few minutes to sit back and reflect on their accomplishments to admire the blood, sweat, and tears they’ve sacrificed.
For our leaders, Anand Buch, Chief Strategy Officer at Crexendo, former CEO of NetSapiens, and Doug Gaylor, President and COO of Crexendo®, Nasdaq honoring their efforts of reaching 2.5 million users in Times Square was humbling, to say the least. It prompted them to sit back, reflect, and briefly step away from the trenches to revel in their success. For the organization as a whole, it was a reminder that the work we’ve put in collectively is paying off.
It’s one thing to receive praise from our peers, but for the universally-known Nasdaq Stock Exchange to acknowledge us in such a grand fashion is a testament to the Crexendo® leadership that navigated us here. Fortunately, Anand and Doug took a moment from their busy schedule(s) to sit down and discuss this most recent and rewarding accomplishment.
The Conversation
A brief history of Crexendo® and NetSapiens and the merger from Anand & Doug’s perspective:
No matter who you are, when you sit down with the President and COO of a successful organization or the founder and CEO of another, the energy of the room shifts. Their demeanor reminds you of the weight they hold on their shoulders, and the constant pings of emails and text messages in the background show how valuable the time they’re sharing with you is, so you automatically shift into sponge mode to absorb everything they have to say.
My first question was to learn more about the recent merger that brought two independently successful organizations into one and how the two reached that point:
Doug: Well, I’m going all the way back to the beginning for this one. For the last 34 years, I’ve been working with Steve Mihaylo (Crexendo’s CEO). Steve started a company known as Inter-tel during the period when the telecom industry became competitive. Steve is a pioneer and started as a one-man company. I started working with him in 1978, right after college. When Inter-tel sold in 2008, Steve owned one-third of the publicly-held company. Instead of riding off into the sunset, Steve called me two years later and he said to me “hey, let’s do it again. Everything is moving to the cloud.” Crexendo, which was once a web services company in Utah, caught Steve’s eye, and he saw an opportunity to transform the company. In 2012, we had our first customers on the platform. We’ve accomplished a lot in only ten years but the objective is to grow more.
When I met Anand in February of 2020 at a Communication Alliance meeting in Fort Lauderdale, Florida, it led to conversations about challenges Crexendo® and NetSapiens were facing from a growth perspective. The more we talked, we both realized we had similar goals and ideas. We discussed the opportunities inspired by the pandemic and what we can do. Unified communications were huge. Discussions gained traction. Negotiations took some time, but before you know it, the deal was put to paper. At the beginning of 2021, the deal was announced. By June, it was finalized. We acquired them for three reasons: technology, monetization of the opportunity because of their great technology, and the tremendous amount of talent NetSapiens brought to the team. It all made sense, and it was one of the best decisions we’ve made.
Anand: NetSapiens came to fruition in 2002, but the first three to four years were centered around building the initial versions of the product and developing a go-to-market strategy. It wasn’t until 2006 that we kicked off the flagship solution, but our vision was to create a flexible and powerful platform focused on non-tier one services to have a platform they could go to market with. First and foremost, communications were focused around voice. At the time, there wasn’t a single service provider that focused on that space. From day one, the goal was always to build two elements – offer a flexible platform for service providers, and build it on a disruptive business model that helped service providers compete in the service market and continue growing. The vision was to build everything organically and never get large amounts of capital. Any financing and capital raises are based on the merits of a fundamental business.
At the end of the day, you had to ask yourself – what do we want to do? We’d seen growth in the market, and it grew faster than the aggregate market was growing. We pack an enormous punch for our size, a testament to our team and what we’ve created at our core, but if you’re not growing, you’re dying. We built an incredible team, our service providers were growing themselves, and growth occurred faster than what we could grow organically. Ultimately, we went on the path to find our next step. The merger route allowed us to combine forces and have a sustainable financing option moving forward, so when I met Doug in Florida and discussed our goals, it was a match made in heaven. It was incredible timing. He knew what we had built, and the Crexendo® culture mirrored that of NetSapiens, making the decision simple. We’re thrilled with how it’s turned out.
Crexendo® named the fastest-growing UCaaS platform in North America by Frost & Sullivan – what were your initial thoughts?
There are some achievements that mean more than others to an organization’s leaders. When I sat down with Anand and Doug and brought up this question, it was hard for them to keep a poker face. You could tell it was a big deal:
Doug: Well, the first thing that came to mind was pride in that accomplishment. When you think about that statement and who we’re competing against – Cisco, Microsoft – these are multi-billion dollar organizations. So, it’s pretty amazing when you think of it that way. Being recognized as the fastest-growing UCaaS platform in North America means we’ve built something there’s a tremendous amount of need and desire. It’s great that we’ve built something with such a high adoption rate that sells itself. Our marketing budget is not the same as the big guys, so we’ve had to earn our stripes. When Frost & Sullivan recognizes that, it’s fantastic.
Anand: I knew it was coming, but seeing it in front of me was a bit surreal. It was humbling. Here we are as a part of a larger corporation, the NetSapiens platform is at the core of Crexendo as a company, and that I’m part of Crexendo, it’s hard to put into words. It’s incredibly challenging for entrepreneurs to reach a point where they see something they’ve been a part of, and to be on this stage – it’s special. It’s like watching your kids grow and hitting milestones in life. Just reflecting on the journey – it’s a beautiful thing to be a part of.
You know all of the work that went on behind the scenes. When you saw that picture from Nasdaq congratulating Crexendo® on 2.5 million users, what were you thinking?
When you sit down with prominent leaders of an organization, they’re quick to deflect praise of the accomplishments the business earned. In company meetings, Anand and Doug are always eager to give the entire team credit for such monumental achievements, but throughout our conversation, I could tell this one meant the most to them:
Doug: Seeing that in Times Square, wow. It meant a lot, especially considering the advertising we got! The entire team helped us achieve this point. As far as 2.5 million users, when I think about growth in the industry, we’re growing at a good clip. When our partners grow, it’s a tremendous opportunity to take advantage of that growth. You might not see it in our financial statements, but you see it in our success. We’re also excited about seeing that same picture up there, hopefully by the end of the year, congratulating Crexendo on reaching three-million users.
Anand: There are a couple of angles – when I think about it from the standpoint of the marketplace, what’s incredibly satisfying is that our technology is touching a significant number of people. Again, I think to see that continue to grow is incredible. The other exciting part is that we’ve created a substantial base of users with other vendors who want to participate in the same ecosystem. When you look at 2.5 million users next to the size of our organization, you think, OK, that’s incredible. To me, the way and how we built this business and user base is the most satisfying. It points to what we’ve been able to achieve as a team.
Finally, we know that you have a lot planned for Crexendo®. What can you share with us? What does the future of this organization look like?
The best part of any interview is asking leadership where they see their organization going. It allows them to slip in some hints of what’s to come and let our imagination run wild about the next steps. Anand and Doug were both optimistic, yet realistic, about the future of Crexendo®:
Doug: Five years ago, Crexendo was an eight-million-dollar business losing money. Today, we’re a 35-million-dollar company with a tremendous growth opportunity. I see us growing at 20 to 25 percent organically. As long as we continue doing what we’re doing and growing at 20 percent annually, there’s no reason that next year we can’t be at 42-million-dollars organically. The year after that, 51-million-dollars organically. Throw in a few acquisitions, we could push that to 75-to-100-million in revenue, which would double the size of the company. The sky’s the limit. We manage the business to ensure viability. We’re doing it smart so the business is successful when we ultimately reach that 100-million-dollar mark.
Anand: We must be realistic about where we are – we’re at an exciting time and must be disciplined with our investments to grow. I agree with Doug’s comments – the sky’s the limit. As long as we remain disciplined, which is at the core of our philosophy, we have the recipe for success. We know where tech is going, and that will help us grow beyond where we are today. There will be a continued push for the as-a-service model, and we must focus on vendor partnerships, but our immediate need is to focus on our customers. How big can we go? There’s no reason we can’t reach that 100-million-dollar mark.
The Wrap Up
From discussing the history of the organization, achieving “the fastest-growing UCaaS platform in North America” status, to what went on behind the scenes of reaching 2.5 million end-users, it was a productive and fascinating conversation with two industry leaders that love every minute of what they do.
When you reach this level of your career, everyone around you understands the sacrifices that must be made and the burden you carry on your shoulders to do what’s best for the organization. The decisions leaders make each day would keep most of us up at night. However, for them, it’s just another day. When they give up a few minutes to discuss an accomplishment, you know it’s a big deal because time is the one thing they have little to spare.
Crexendo® has survived a lot and built a product customers rave about. The merger with NetSapiens has made us an undeniable superpower, ready to take on the largest organizations in the industry. Two leaders with an attention to detail and a desire to grow organically are why Anand and Doug will soon sit down with us again to discuss reaching the five million user mark and how they achieved $100 million in revenue organically. It’ll be here sooner than we think, especially with them at wheel.
