Odilo is a technology company based in Murcia that has kept a low profile in the Spanish startup ecosystem. While the focus is on cities like Madrid or Barcelona, some companies born in smaller, less publicized areas are building what appear to be strong businesses with a brand from day one.
Odilo is an example. The company works with libraries and educational institutions in Spain, Latin America and the United States to provide them with loan systems for digital educational content with Spanish technology. A sector not too much sexy compared to others, but with a solution that seems to meet the needs of libraries on both sides of the Atlantic.
To find out more about Odilo, who received $2.8 million investment in 2014 from Active VP, we recently sat down with its CEO and co-founder Rodrigo Rodríguez. This is an edited version of the conversation.
Odilo, a success story based on digital educational content
What is the story behind Odilo? After several years at Telefónica and BT, why did you choose this sector?
Rodrigo Rodriguez (Odilo): Before starting at Odilo, I was working in the cloud computing sector and had previous knowledge of the technology used by many libraries. When we saw that we knew that this was going to open up new opportunities for editorial industry but mainly for libraries and the educational sector, transforming them by creating new ways to access digital educational content.
Our idea was conceived around the creation of a service that could allow any institution to easily offer digital educational content to its users. Based on my experience in IaaS (Infrastructure as a Service) we decided that the best way to do it was to create the concept of CaaS (Content as a Service) where we could follow a path similar to that of but applied to digital content of any kind.
At first glance, it seems that Odilo has several products, some aimed at libraries and educational institutions and others for publishers. How do all these products and their different business models come together?
Rodrigo Rodriguez (Odilo): All of our solutions are based on our CaaS model in which we offer our technology and partner with providers of digital educational content of all kinds. This service/technology is what underpins all of our products. we create new layers and functionalities about it, to adapt it and serve the needs of other sectors such as leisure, universities, primary schools, public libraries, corporate and special libraries, etc.
We also have quite a few companies that use our technology under license to create your own products on it. In this way we can be flexible enough to market our services in different markets and territories while maintaining our focus on our core services.
You have followed in Odilo an interesting model that is frequently seen in Europe, where startups decide to keep technological talent in low-cost regions (in your case Murcia) while managing sales and marketing from larger cities such as Madrid or even the United States. . How has the process to leave Murcia been?
Rodrigo Rodriguez (Odilo): I am from Cartagena, and our city has a good university and a very good quality of life, so I thought this would be a good place to start a technology company. We have an agreement with the University of Cartagena whereby teachers recommend their best students to work with us. This would be somewhat more difficult to do in large cities with more competitors to attract talent.
We have also managed to convince technical talent from other cities to come to Cartagena and fill other positions in the company. Last year we had to open an office in Madrid for our sales team and most of our customer support is located there. At the same time we open offices in Mexico and the United States to better connect with international publishers and clients in the field of digital educational content.
If I’m not mistaken, your team is quite distributed: You are in Miami, your COO is in Madrid and the CTO is in Murcia. What are the biggest challenges of working this way? What is your experience in building a distributed team being small (less than 50 employees)?
Rodrigo Rodriguez (Odilo): We have a COO for North America and Australia in Colorado, so I can spend more time in Madrid, but it’s A challenge for us to manage such a diverse and distributed team of 46 people of 6 nationalities.
My idea was to bring the best possible talent to the company regardless of their location or nationality. We use technology and team management tools and methodologies to be as efficient as possible, but based on our experience the key thing about this is that everyone understands and shares our vision and company culture, which allows them to be independent in their responsibilities without losing agility.
Also important, speaking of company culture, is the fact that we all have a deep sense of commitment and show a confident attitude. From our experience so far, distributed teams can work very well if all team members completely trust each other, which makes things a lot easier.
In 2013 Odilo reached sales between 300,000 and 600,000 euros, exceeding one million in 2014. In that year you also received an investment of 2.8 million dollars from Active VP. How is the economic aspect of the business?
Rodrigo Rodriguez (Odilo): Odilo was founded as a self-financed company and we try to be profitable from the beginning, combining R&D initiatives with digital educational content projects for clients. We have grown steadily every year, incorporating new products and agreements with partners at the same time. 2015 has been a great year for us: we signed our biggest contract, which will take us to increase the number of users who receive digital educational content through our platforms from 9 to 107 million people early next year.
How is the sales process? Is it difficult to convince large institutions such as libraries and universities of what you put on the table, or are they already aware of the need to improve their current (and I imagine old) systems for accessing digital educational content for their own benefit and the of your readers?
Rodrigo Rodriguez (Odilo): Institutions know that their users and students demand access to digital educational content at any time and from anywhere, and that they need to include digital content as part of their services to be relevant in the future.
Our job is not so much to convince them to adopt technology as to help them in this transition from physical to digital, and our challenge is to accelerate the adoption process of digital educational content loans. In the United States, more than 90% of libraries and most schools offer digital loans. to its members and students, and the market has been growing exponentially. In any case, Spain and the Spanish-speaking countries are five years behind but we estimate that the market will grow at the same rate as the US market.
The future: Grow in the United States and continue to be leaders in digital educational content in Spanish-speaking
Having a significant presence in Spain and Latin America, is the United States the next great frontier for the company? What differences are there between the North American market and the Spanish or Latin American market? Are the libraries and customers more forward thinking there and do they understand your value proposition or has this happened in other markets where you already operate?
Rodrigo Rodriguez (Odilo): Yes, at Odilo we have a unique value proposition for the United States with a business model that has been very well accepted in that market. We have several success stories in libraries and schools.
Given that the lending of digital educational content has a high penetration in the United States, our focus is on demonstrating the benefits of CaaS as an excellent way for institutions can offer large collections of digital educational content and only pay for what your users and students actually use. In this case, our sales strategy focuses on the key differences in our business model and technology, while in Spain and Latin America we focus on accelerating technology adoption, as we are strong leaders in these markets.
What are Odilo’s short-term goals and where would you like to see the company in 3-5 years?
Rodrigo Rodriguez (Odilo): In the short term our objectives are increase our market share in the United States. We want to build a strong sales team for Odilo there and we want to maintain our leadership position in Spanish-speaking countries as institutions gradually increase their budgets for digital educational content.
We also want to increase the number of companies that use our CaaS platform to create their own products to serve different vertical markets. In the medium term, institutions of all kinds will offer access to digital educational content to their users, employees and students just as they now offer WiFi access. To do this they will follow a CaaS model and we want Odilo to be the company that leads this transformation.
Jaime Novoa,
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