The following interview is a conversation we had with Joonas Ahola, CEO & Founder of MeetingPackage, on our podcast Category Visionaries. You can view the full episode here: $8 Million Raised to Transform Venue Management.
Joonas Ahola
Thanks for having me. Great to be here.
Brett
Tell us about Finland. What’s going on in Finland today?
Joonas Ahola
To be honest, it’s half seven, it’s a little bit dark, rainy, zero degrees celsius, whatever that is in fahrenheit, but it’s, let’s say dark, gray and rainy.
Brett
What about the tech ecosystem? How would you describe the tech ecosystem today? I feel like I’m seeing more and more companies coming out of Finland. We just published an interview, I should say last week with someone from Relic Solutions, the founder of Relic Solutions, and she was awesome, an incredible founder. So it seems like there’s a lot of exciting stuff happening in the Finland tech ecosystem. So talk to us about that ecosystem. What’s going on there?
Joonas Ahola
I think in general, like Finland has been super successful in the past, I would say eight, nine years. And of course there’s a lot of things happening here in the whole startup growth company scene like Slush, which is one of the heavy tech conferences, making a big appeal between the whole european landscape and I would say even a global landscape like people coming from San Francisco all the way here, slush meeting investors, startups, etcetera. Thats of course one of the big things and mainly driven by the successes that theres been with Supercell and a lot of the gaming companies. And of course lately I think it was last year, for example, vault, the food delivery company, got also acquired a lot of great successes from different verticals, especially on the gaming side.
Brett
Let’s talk a little bit about your background, your journey, and how you found your way into tech. So take us back to the early days of your career.
Joonas Ahola
I started myself as an entrepreneur at the age of 14, so I’m kind of a black sheep of the family. No entrepreneurs in the whole family. Got to work with the entrepreneurship and ways of operating and working, and kind of having the possibility to deliver something that is in your head, in a sense, that making things actionable and solving a problem. Then at the age of 16, I started my second company, which was on the event agency landscape. We were doing events from different kinds, from birthday parties to weddings to corporate events, and grew that more or less nationwide in 20, 1314. Kind of fed up with the RFPs and the inquiries, like how traditional the business was, how unscalable it was.
Joonas Ahola
And at that point, we only had, like, event spaces and catering, which meant the fact that we didn’t have additional revenue streams other than events. And of course, events in general are quite seasonable. So if you are in a seasonal business in Finland, it’s super risky to hire full time employees for a business that is super sensitive to seasonalities. And that kind of fed up. Me, I was growing as a person, of course, hitting those 23, 34 years old at that point, and started looking at the problem of the RFP spam. What happened in the industry? Like customers sending you requests, you cannot even answer the request, etcetera, started looking at technologies out in the market that could actually solve and optimize that from a vendor perspective.
Joonas Ahola
And since we didn’t find anything, of course, what can an entrepreneur do is to build a company and start fixing that issue. There’s a long history from that, like what meeting package today is, as you mentioned, like venue management software and how we operate on that landscape. But it didn’t start with that angle completely. And long story short, we thought that we can fix the whole issue in the industry by being a marketplace kind of copying the Airbnb model in the meetings and events landscape. And what we realized as being operational one, two years, like we launched in 2016 as a marketplace that will never fly in this industry, and mainly because of the fact that hotels and venues already are professionals and they already have technology that run their operations.
Joonas Ahola
So if you just have an extranet marketplace, it will never fly because it’s not connected to the live inventory. Why it worked for the likes of Airbnb and so on. If you have your own apartment, that’s going to be your proprietary software where your inventory lies when you go to Airbnb. In our case, it was just an extranet for the suppliers. And eventually we figured out that customers really wanted to book online, but suppliers were not ready. And that’s when we people did in 2018 to focus on fixing the actual problem instead of creating more rfp spam.
Brett
Into the industry pivots are always very hard. I think it’s hard to know exactly when to pivot, and it’s hard to pull it off. What did you learn from that whole experience?
Joonas Ahola
I think one of the things is, of course, giving up on the whole ideology of why you originally like, started building a marketplace, of course, giving up is always a big question for any entrepreneur. And admitting the flaws and admitting that the current direction is not the right direction. And of course, numbers advisors, investors help you to analyze those figures and face the reality in a sense that this is not scalable, the unit economics are not there. And then really looking into the problem and the status quo of why it doesn’t work. And then ultimately, our vision has always made meetings and event services bookable anywhere and making them as easy bookable as you book in a bedroom from or anywhere else. And that large vision has never changed. But how do we get to the end result that has changed?
Joonas Ahola
And I think that’s one of the answers to your question, in a sense that it’s never easy. And however, once you start to see the early traction after you people, that’s giving you more light in the tunnel and saying, hey, God dammit, we will still keep on the whole mission and vision statement, but with a different business logic.
Brett
So 2018, you do the pivot. What are those first three to six months look like? What metrics were you measuring and looking at to make sure that the pivot was working and that you were gaining traction?
Joonas Ahola
Yeah, I think it took us for a little bit more than three to six months after pivot to kind of really get this software working. Since were a marketplace, we didn’t have like offline tools for the sales of a hotel. So maybe good for everyone in the audience to understand what meeting package does is to streamline and automate the operations for meetings and events and group booking business, which is roughly 20% to 30% off hotels revenue in general. And that’s completely offline. Manual phone calls, emails, and what we wanted to do is to completely optimize that in a sense that whether it’s offline, online, direct or indirect, there’s technology that allows streamlined responses, whether it’s online instant booking, or then automation from an offline site.
Joonas Ahola
And after the pivot, it took us some time to build that stack integrations to the legacy software, which took us more than two years to build, not because of technology, but because in our industry, there’s a lot of, let’s say, legacy vendors who don’t necessarily have open APIs, and you need to go through a lot of politics to get to the right people to have access to the APIs. And that took us some time to get there. But I would say after nine months, twelve months, we started measuring based on conversion. So if an industry average conversion was less than 10%, how can we improve the conversion from lead to booking, and then eventually landed up into a situation that we’re happy if the conversion lies above 50%? And currently we hit 60% to 70% on average.
Brett
Who is the ICP today, and what was that journey like to uncovering the ICP? From my conversations with founders, that’s something that’s always very tricky to figure out is what area of the market do we want to focus on, where do we want to invest? Time, energy, resources. So how did you uncover that ICP?
Joonas Ahola
In some respect, when we look at the ICP, the things that we did on marketplace times were not kind of wasted. Even though we spent some millions in developing the marketplace, marketing and so on, that gave us so much valuable data on what are the customers expecting, what are they looking for? And once we started building the software for the hotel side, that gave us the understanding that okay, where does the demand lie? What kind of properties are the customers actually looking to book? So from an ICP perspective, our focus has been on a full service hotel perspective, which means the fact that, let’s say 30% of your revenue at least is coming from meetings and events and groups. And then it was easier for us to actually remove vendors from the ICP and hotels.
Joonas Ahola
Let’s say your mom and pop hotel, or your hotel is in the middle of nowhere and you don’t really have any p, two P customers or corporates coming in. That was super easy for us to remove and rather focus on the, let’s say, enterprise SME’s that are more on the full service model. And as we’ve grown, it’s more the fact also to understand that the easiest sells for us is the ones that don’t have integration problems. Meaning we already have an integration to their operational system, whether it’s a sales and catering or a property management software. And once we have that, it doesn’t bring that bottleneck that hey, everything sounds super good, but unless you have the integration to XYZ company, we cannot operate. And those kind of eliminated.
Joonas Ahola
So we vended from a little bit from an other angle that hey, hotels in general are our customers, but who are not our customers. And then the rest were kind of on the ICP target. Also, what I want to highlight on the ICP as we are a product based company and evolving our products to it as we go along. Our ICP also has changed over the course of the company that what we had in the beginning like hey you run on opera sales and catering, you are our customer now. It includes multiple sales and caterings, also standalone solutions, back office solutions. It can be used by even management companies so it differs based on the products. Also that our salespeople are selling.
Brett
How do you think about your marketing philosophy? If you had to define that and describe the approach to marketing, what’s that approach?
Joonas Ahola
Today marketing is heavily driven by, lets say the whole GTM is driven heavily by our partnership strategy. Like mentioned earlier, we do have a product which is called the channel manager that connects with the third party distribution channels like technically our ex competitors. So the other marketplaces in the world, the DMCs, the online travel agencies and of course they have the demand but they dont have the technology that we have for the inventory. So were kind of together with them that they give us a hotel providers that they would like to have on their marketplace and then of course we connect to them and say hey by the way, to get traffic from this marketplace you need to be a partner of meeting package. So thats kind of the flywheel impact.
Joonas Ahola
Not necessarily directly involved in marketing as per se, but I think in our context marketing is more the kind of GTM motion of partnerships and sales rather than just pure marketing. And when it comes to marketing, I think things that have been working for us is events in general. We work in hospitality, everyone in hospitality is super well connected and you need to have the doors to open instead of just cold calling and trying to get people to come to a webinar or a call.
Brett
What about what’s not working? Can you think of anything that you’ve tried or experimented with early days that didn’t work from a marketing and sales perspective?
Joonas Ahola
I think a lot like. And it’s also the fact that what kind of people we have in house, we also acknowledge the fact that we need to have industry experts like just taking people to do sales. We acknowledge the fact that we need to have people who can challenge the hotels because we’re not creating a vertical, we’re changing the way they operate. So kind of you need to challenge and have that thought leadership position when the hotels come to you and when you talk to them to be able to close the deal. Like what, we realized that you actually have a lot of possibilities in opening, getting the interest. But closing the deal was much harder when you didn’t have that kind of industry knowledge or background to question those ways of operating that are in the hotel.
Joonas Ahola
So I think one of the things was related to of course resourcing and people. But when you look at it marketing wise, I think what didnt work in the past, what we tried to scale heavily was during already the marketplace times to contract the non contracted vendors by putting demand on their table. And one of the reasons it didnt scale was that first of all, when you receive a booking from us or an inquiry at that point, people didn’t know about who is meeting package, what is this? And secondly of all, it might have completely wrong table. So we thought that we could scale it only by having enough interest from the demand to that hotel. And then we tried to close the hotel. That clearly didn’t work.
Joonas Ahola
So it was we needed to talk to the right people in the organization to actually start closing the deals.
Brett
What about your market category? Is it venue management? Or how do you think about the market category that you’re in?
Joonas Ahola
That’s actually a tricky one. Always, like when you go to these conferences or especially in the startup scene that you register, I don’t know, web Summit, slush, etcetera, you don’t really have a category for what we do normally we do fall under the hotel tech umbrella and then we fall under the meetings and events. Sales tools is even a category. So I would say to some extent we are in the distribution landscape. We’ve actually started calling ourselves the venue sales management. I don’t think that is actually even a category globally, but that’s how we wanted to rebrand the whole legacy sales and catering world, sort of industry jargon words, and call us instead of venue sales management. Then you could say that we’re venue management software in that sense.
Brett
Normally ask about what pivot or what changes you made that had a huge impact on the company. But I think it’s pretty obvious that pivot and change in 2018 outside of that. So let’s say from 2018 today, what’s been the most important decision that you’ve made so far.
Joonas Ahola
That’s a difficult one. It’s easier to say the other way around. But let’s say there’s been so much, it’s not been a smooth sailing ride like, as you’ve heard already, kind of being from 2016 pivoting to 2018. And then, of course, what happened in our industry was Covid-19 quite heavily impacting our operations. All hotels are closed. Nobody’s booking meetings or events or group business. That was another kind of major roller coaster ride, if you want to put it like that. But at the same time, that gave us the possibility to kind of clean up the table from anything that we had. Legacy from the marketplace times.
Joonas Ahola
Because in 2016 to 2018, even though we pivoted, you still had a lot of legacy, whether it was mindset related from people or whether it was technology related, marketing material related, you still saw everywhere, like Mediumpackage.com instead of medium package, as we rebranded also and so forth. So I think in general, post the whole Covid period, the best decision that we had was to focus and first of all, raise a convertible capital loan from our existing investors to bridge that kind of period during 2020 to 2022, when Covid was impacting our industry heavily and to still keep investing on our technology.
Joonas Ahola
Because I think that made us grow as we’ve been growing now, the past, let’s say, 24 months, because we focused on our niche, focused on our product and our technology, and made the best product out in the market, on the venue booking software landscape. That was, I think, one of the things that a lot of vendors might have during COVID kind of froze all of engineering and kind of shut down engineering at first. But we decided that, okay, let’s rather shut down customer success and marketing and completely focus on engineering and R and D at that point. And it gave us the freedom, posted pivot. To kind of get our product to where it should be.
Brett
What was that like, trying to raise funds at that time?
Joonas Ahola
Thankfully, we had a lot of angels at that point. Like now, last September, we raised our first venture round. Until that point, more than five, let’s say altogether, during the lifetime of our company, more than 5 million angel money has been invested in the company. So there was, of course, as you know, like angels invest in people and not necessarily the product or even the growth or the metrics that you have. So it was quite thankful that I went completely transparently to our investors saying, hey, we truly believe on our vision statement. We saw that from 2018, 1920, were on high growth mode. Now this happens. It’s nothing to do with us or the company. However, we feel that if we raise now and invest, we can be much further ahead of any competition out in the market once the industry recovers.
Joonas Ahola
So I think that was one of the main reasons were able to raise was the trust factor and that the existing investors have seen what weve already been able to deliver and commit and expectations were managed.
Brett
Makes sense. Now, getting into our final round of questions here, as I mentioned there in the intro, 8 million to date has been raised. What would you say youve learned about fundraising throughout this whole process?
Joonas Ahola
Oh my. At least the amount of nos. I don’t anymore even feel that, no anymore, even though I get it. I think that’s one of those things that knocking off doors and you’ll get first of all valuable feedback, but at the same time you understand who you necessarily, you don’t want to operate with. And then of course, as fundraising in general, you need to also be, let’s say, trusting the investors that you bring on board. And I feel like, especially if I look at it from a global perspective, in Finland, we are not that heavy on fundraising in general, like the rounds are smaller and things like that. But I think the trust that we have with our investors is super high and raising money in general.
Joonas Ahola
What ive learned looking historically now is its about momentum, its about getting the right VC’s right investors at the right time. We tried to raise money when were not in that position to raise money and in that sense know also your ICP when raising money instead of just kind of going to the public market and starting from the top ten VC’s in the world and start pitching it, because ultimately you’re wasting their time and your own time and trying to win something that you cannot with thesis that you have, at least with a first or second time founder, when you don’t have that global exit behind you.
Brett
Let’s imagine that you’re having coffee with a founder who is building technology and they want to sell into the hospitality market based on everything that you know, what would be the number one piece of advice that you give them to.
Joonas Ahola
If they would be on the hospitality, let’s say, hotel tech market in general? I would say super clear on, let’s say geographical focus depending on what kind of product they have. But of course, for us, some things that have slowed us down in the past was the fact that went global like right away and trying to attack every market. I think one of the things is that there’s so much opportunities, even in smaller countries and smaller markets, to kind of penetrate that market nowadays. We’ve been successful, but if we look at it kind of early days, were not really peaked anywhere. We had hotels from tens of different countries. But ultimately everyone always asks, okay, who else do you have on board? And then if you don’t have like, a good penetration coverage within that local area, makes it a little bit different.
Joonas Ahola
And also what I would say is kind of start building those relations. And the hotel industry is so much driven by these kinds of networks and network effects, in a sense, that the person you talk today might be working tomorrow in the other hotel. And that’s just like how the industry works.
Brett
Final question for you. Let’s zoom out three to five years into the future. What’s the big picture vision that you’re building here?
Joonas Ahola
Big picture is that we want to be the biggest owner of inventory going global. So let’s say we do feel that going further ahead in the whole meetings, events and group booking landscape, that it will be a new vertical within any of the online travel agencies and meta searches and so on, where you can currently book transportation or air travel or I, let’s say accommodation. But meetings and events is kind of the last remaining pocket when it comes to, for example, business travel. Our big vision is that we will be the biggest one at that point when that happens, where those vendors will fetch inventory pricing and make transactions. True. And then by 2027, we want to have 50,000 instantly bookable venues globally. And that’s our mission.
Brett
Amazing. I love it. We are up on time, so we’ll have to wrap here before we do. If there’s any founders that are listening in that want to follow along with your journey, where should they go?
Joonas Ahola
Well, first of all, feel free to connect in LinkedIn and others. Jonas Ahola, and then, of course, following our journey admitting package and anything in hospitality related, feel free to reach out. Awesome.
Brett
Thank you so much for taking the time. Really appreciate it. It’s been a lot of fun.
Joonas Ahola
Thank you, Brett. Appreciate it.
Brett
This episode of Category Visionaries is brought to you by Front Lines Media, Silicon Valley’s leading podcast production studio. If you’re a B2B founder looking for help launching and growing your own podcast, visit Frontlines.io podcast. And for the latest episode, search for category visionaries on your podcast platform of choice. Thanks for listening and we’ll catch you on the next episode.
Twitter
facebook
linkedin