Norwegian entrepreneur Stian Rustad (44), founder and co-founder of almost 40 companies, was interviewed by Daily Scandinavian in the beginning of this month. He said that one of the reasons for his success was the coinciding with the evolvement of the Internet.
Straight from his engineering and financial studies in Norway he served his military ‘dream duty’, as he calls it, at NATO in Brussels. His assignments there led him to understand the possibilities of having a web-based ERP-system delivered on Cloud Computing technology and SaaS (Software as a service).
After his military duty, Stian and soon eight more partners realized that they needed better management systems. In 1996, with the help from a regional business and organizational body in Norway, he established the first ERP web-based company in Europe for mid-sized companies, 24SevenOffice. Working via the cloud, the team could now work from everywhere.
The solution was based on modules and included everything a medium-sized business needs to manage its business in one integrated system. In addition 24SevenOffice is integrated with over 200 third-party solutions including most banks, debt collection, disposal systems, online trading, production systems, industry solutions, pre-systems, etc.
Accountants for mid-sized companies were an important target group. With the help of the ERP system businesses were able to share information with shareholders, stakeholders, accounting, auditors, advisors etc.
Today 24SevenOffice has more than 20,000 customers in Norway and Sweden, and increased its turnover by 30 percent last year.
What is the reason for your success, Stian?
“I’ve always been working closely with my companies.
One company I started together with the main founder Bjørn Roland in 2002, Regnskapsfabrikken, (‘The Accounting Factory’) involved 50 people and was sold to PWC. The company focused on system development, implementation and consultancy in relation to hardware and software, as well as financial and administrative systems. That was my first larger exit.
I was engaged in Norway’s first cloud-based server company, which I sold to the Braathe Gruppen. That was my second exit.
Early on I realized the challenges related to telemarketing. Salespeople had to manually press the keys to contact potential clients. My company Oyatel replaced the traditional corporate phone system and became the first IP-based system in Norway. The system enabled businesses to manage without the traditional Cisco box. The company was sold to the A-group. This was my third exit.”
Propartner Defense at Notodden was offered for sale, and Stian bought it by chance. The company produced advanced high-tech electronics for domestic and international customers and had long experience in electromechanical assembly and cable assembly. Stian completed a turnaround and sold the company to an Orkla owned investmentcompany. That was his fourth exit.
Is it your strategy to buy, build and sell?
“I like to build a company and stay as long as I know I can contribute to the company’s growth. When I realize I cannot infuse more to the company than a potential buyer, I want to sell it. At the same time it is a social issue as I want to invest in new businesses in which I have more to add.
Six years ago I wanted to buy a new car and visited a car dealer in downtown Oslo. There was an extremely knowledgeable and accomplished salesman. It turned out that I knew his brother, and I was asked if I wanted to invest in the company. I did and together we restructured the company and slowly the company increased its turnover by NOK 200 million. In fact, this was not an exit, I am still one of the owners.
Today I am involved in almost 40 companies.”
There must have been some challenges?
“Yes, indeed. One of the most common questions from the founders following an investment discussion is whether the investment company requires management representation and / or possibly the majority of the board as part of the shareholder agreement. As a minority shareholder I was once involved in a company where I was completely isolated. The board took many very important decisions that I and the rest of the management team knew were wrong. They did not understand the company culture well enough. The board did not understand that the company did not possess good enough systems, routines or tools to hire a large amount of sales reps. The company burned too much money and the growth ceased. The members of the board were competent enough, but they were unfamiliar with the business, prerequisites and restrictions. Group dynamics lead to the fact that too little or too much was being done. For readers interested in more information, read my LinkedIn article.” (In Norwegian only)
What is your advice to entrepreneurs?
“Focus on sales and marketing and get your act together. Too many entrepreneurs use post-it notes and defer accounting and finance. You have to be structured and focus on project management. But not to such a degree that it takes away your attention from the company. Find the right level of attention in relation to the stage that your company is at. A success factor is electronic documentation. Too many business people use too much time looking for this and that.”
I have recently moved to Manhattan, New York City with my family. I know there’s a market for 24SevenOffice in the USA. I know that expensive ERP cloud systems for big corporations and cheap systems for small companies already exist, but there’s a lack of systems for medium sized companies. My aim now is to start spreading the word about 24SevenOffice here. I love Manhattan – and I love challenges.”
The Sky is No Limit for Norwegian Entrepreneur: Stian Rustad was interviewed by Tor Kjolberg