Sramana: How many customers were involved in the early R&D and validation stage?
Ricardo Villadiego: I could count the number of people on one hand. There were a maximum of 5.
Sramana: That is fantastic. For an entrepreneur to get 3 to 5 solid enterprise customers for a complex system like this early on is invaluable. I find it even more fascinating that you did that in Latin America based out of Columbia. We don’t see a lot of technology companies being built in Latin America.
Ricardo Villadiego: That is correct. There were good and bad things about our situation. When you start building a company and you have a close group of friends that can provide you with feedback, that is very valuable. They see value there as well. However, when you go to the next level and you want to be the leader in electronic fraud prevention, there is a big paradigm in the technology adoption process. Banks are very conservative clients and usually buy from very well established US companies like IBM. Here, we were – some crazy company out of Columbia trying to build amazing technology and push it to the world.
Sramana: You got validation from your friends, but how did you overcome the geographical obstacle? Did banks resist buying from a small company like yours?
Ricardo Villadiego: They were very hesitant and we started with a lot of month-to-month contracts. We converted many of them as they gained confidence in our ability to deliver and protect them. We converted those into multi-year contracts. That was nice, because it put a lot of stability and predictability into our revenue.
I remember that with our first bank, we had month-to-month contracts for the first six months. The technology validated the platform and they wanted to make sure that we could deliver every month of the contract.
Sramana: When did you release the first product that allowed you to start month-to-month contracts?
Ricardo Villadiego: We released it in 2009. I started with Easy Solutions full-time in February 2009 and my first client was closed in May 2009.
Sramana: At that point, were you still bootstrapping the company with your own money?
Ricardo Villadiego: Yes, we were still bootstrapping. I was trying to raise money in the US, but there was a financial crisis; so it was impossible to raise money. I did meet with a VC based out of Atlanta whom I knew personally. He gave me some of the best advice I have ever had. He told me to raise my first round in Latin America, prove my company, and return when the market was better in the US. I did just that, although there are not many venture capitalists in Latin America.