Concur Co-founder Raj Singh on How Surviving the Dotcom Bust Shaped the Company Culture and How Mobile Has Changed its Course (Part 1)
Seattle was one of the hardest hit regions during the dotcom boom and subsequent crash of the early 2000s. The companies that were able to survive the fall, however, were grandfathered into a strong regional, and once again booming, technology industry. One of these survivors—now a veteran on the local tech scene—is Redmond, WA-based Concur (NASDAQ: CNQR), a travel and expense reporting software developer.
And while travel and expense reporting software may not sound like the hottest product on the shelves these days, according to co-founder, president, and chief operating officer Rajeev Singh, the company has found a way to maintain rapid growth by shifting away from business services and into the fast-evolving mobile scene.
Singh has seen lots of trends come and go. When Raj and a man named Mike Hilton first founded the company in August of 1993, the two worked out of Raj’s apartment, hiring people with their own money until their first round of funding came through a year or two later. The goal then was to help businesses easily and efficiently manage their expense reporting, before the Internet. Now, 17 years later, all three are still part of the company. While the services they aim to provide have stayed the same, Raj says it’s the solutions that have changed, largely because of the increasing shift toward mobile technology.
Today, Concur products are used by some 10,000 small and large businesses around the world to track day-to-day expenses via traditional, mobile, and cloud-based platforms. The company was one of the first to have products offered in the new Google Apps Marketplace for businesses back in March. Over the last few months, the company has also rolled out new products that allow businesses and their employees to better manage every element of their trip—from hotel reservations to taxi cab pickups—from a mobile device, while also automatically inputting all transaction information into the expense report.
I had the opportunity to speak with Raj last week, just after the company released a few more mobile apps for its Concur Breeze mobile expense reporting system. Alongside its unique history, Raj talked about how the mobile industry has changed Concur’s course and where he sees the company going five years down the line. Here are some of the highlights from the first half of our conversation. Tomorrow, we’ll have the second half.
X: What’s your two-minute company history?
Raj Singh: We started in August of ’93…but in ’93, ’94 there was no web. There was no capacity to build applications that are going to be delivered over the Internet…It wasn’t until ’98 that the company really hit stride…We were probably at the time a less than 100-person company doing less than $10 million in revenues. But then the web happened, and by ’96 we were building a web application. By ’98, our web application on the market for expense reporting really exploded—we grew like mad—and so we took our company public at the end of 1998, so right before the giant dotcom boom of 1999/2000. We were one of the first companies to go public in ’98. We would go through that whole rollercoaster of ’98 through 2001/2 and we were lucky, actually, in that we were one of the only companies that survived that rollercoaster ride.
At the top of the dotcom boom it was craziness—there were companies doing $20-$30 million in revenue that were worth a billion dollars in terms of market cap. It was nuts! And so we were a company whose market value skyrocketed during the boom, and then absolutely tubed when the crash came. And what we’re really proud of is that 99 percent of all companies whose stock goes down below a dollar fail.They go out of business, they get acquired, they go away. We were one of the few that stuck it out, and we survived. And a big reason we survived was in 2002/2003 we saw a trend coming that we embraced, and that was the software as a service trend—this idea that you could deliver all of this via the cloud, and really get companies to buy travel and expense automation without having to deal with the installation of the software and all that sort of stuff. In 2003, I’ll tell you, that was not the most popular decision. When we talked about software as a service and the idea of delivering over the Internet, a lot of analysts and Wall Street analysts said ‘this is crazy, it won’t work.’ They had a justifiable reason for saying so. There was no company out there that had really built a successful business doing it. Fortunately for us, it worked. So from 2003 to 2010, we took a business that really was doing zero dollars in software as a service revenues in 2003, and in 2009, last year, we did about $250 million in revenues.”
Our story, it’s a unique story, but it’s a pretty classic entrepreneurial story, right. You kind of work your way through some ideas. The first one doesn’t work, the second one doesn’t work, the third one doesn’t work. But you keep at it and the fourth of fifth one kind of catches. And that’s where we feel we are right now. We’re growing like crazy. Our company’s grown on a compounded annual growth rate over the last six or seven years in the neighborhood of 40 percent year over year. And we look at the future now as it relates to us delivering a whole set of mobile applications over the last year. We look at the future and think, there is a tremendous amount of really cool innovation happening in our space, that gives us an opportunity to grow from $250 million to well beyond that. And so that’s why we’re still doing it. Seventeen years later we’re all still here, and fundamentally we’re here because we have a growing business, No. 1; No. 2, we work with a bunch of people we think are fantastic; and No. 3, we’ve got this cool business problem that keeps getting more interesting.
And I know that sounds crazy because you hear ‘travel and expense reporting’ and you don’t really think it’s like the coolest thing ever, but what’s cool right now about it is this. Look at what’s happening with the cloud, with mobile devices, with social networking. And when you think about those three things, there’s one person who’s really square in the middle of all three of those things, and that’s the business traveler, the employee. We’re one of the rare companies out there that touches every single employee in every single company that we do business with. And so our capacity to leverage all three of those trends and deliver services to that employee are pretty cool. Right now, we have 10,000 customers and seven million employees who are using our software, so we’ve got some very, very interesting opportunities.
X: The company has really come a long way from that three-man operation back in 1993. How many employees do you have now?
RS: It’s a lot—it’s over 1,200 people now and it’s growing still, meaning we’re hiring people every single day. It’s funny, because sometimes we scratch our heads and say ‘where did all of these people come from?’ But you know the great part about it is we spent a bunch of time in the last seven or eight years saying we’re going to define the kind of place we want to be and the culture of the place so that the people we hire share our values. What we think is great about the place is that Concur has a very down to earth and humble vibe about a place that’s extremely, extremely aggressive. We are very aggressive about what we’re trying to achieve. We’re innovative in terms of the technology that we want to use, but we try to make sure that we have people who abide by this idea that we’re not too full of ourselves, which is hard in the technology industry!