Selling cloud services takes skill

On cloud nine

Text Matti Remes

Case

Midaxo’s cloud-based software solution for mergers and acquisitions has already caught the eye of American companies. Now the Finnish company is sharpening its focus in Europe, too.

Case

Midaxo’s cloud-based software solution for mergers and acquisitions has already caught the eye of American companies. Now the Finnish company is sharpening its focus in Europe, too.

Boston is the third biggest hub for cloud services in the United States, just after Silicon Valley and New York. Thus, the reason software company Midaxo’s global sales and marketing team is located there rather than at the head office in Helsinki.

Jennifer Linehan, VP, Global Sales, says the East Coast city is an excellent base in the United States. “We have 100 customers right now and 75 percent of them are in the US. This has made the United States a natural location for centralising sales and marketing,” Linehan reasons.

“The area’s universities and companies have an abundance of software sector expertise. This gives us robust opportunity to attract the good recruits that a fast-growing company needs,” she adds.

Most potential in US

Established in 2011, Midaxo has developed a cloud-based software platform to help companies manage and execute M&A and other business processes.

The service supports an end-to-end process – from target identification to due diligence and integration.

“Our product helps to simplify and reduce risks in complex M&As that are often implemented on an accelerated schedule. The service also expedites the achievement of post-M&A synergy goals,” Linehan notes.

She points out that it was natural to select the US as Midaxo’s first growth market. By far, the most M&As are done in that country – about 10,000  every year.

“Additionally, American companies are eager to try solutions that improve operational efficiency.”

Sights now on Europe

Bringing added fuel to Midaxo’s pace of growth is the 3.6 million euro financing round that ended last November and in which Tesi was a lead investor.

The additional capital will be used particularly to expand international marketing, sales and customer support, and to expedite product development.

“Midaxo’s biggest challenges are related to the quick scaling of operations – for example, how do we build our own sales process so that we can grow quickly.”

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The majority of M&As are still managed through Excel and email.

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Jennifer Linehan

Linehan believes that there are plenty of potential customers for Midaxo also in Europe, even though fewer M&As are done there.

There are a handful of companies in the world offering software that facilitates M&As. Midaxo’s biggest competitors, however, are the traditional methods.

“The majority of M&As are still managed through Excel and email. Our task is to convince companies that there are more efficient tools available for managing the complex processes.”

One hundred customers and growing

Midaxo has one hundred customers, of which 22 are on the global 1000 list.  Most of the customers are in the United States, for example: ADT, Hewlett Packard Enterprise, and PTC.

“In addition to the major international companies that have a lot of M&A activity, we are also interested in the medium-sized companies. They do fewer M&As but are equally in need of more efficient tools.”

The majority of the leads, such as contacts with potential customers, comes through the Internet with companies searching for new tools to improve the efficiency of the M&A process.

“They find Midaxo’s website, become interested in the service, and ask us to contact them. After that, we assess the potential of the lead becoming a customer and whether it is feasible to move forward.”

The next step is a 30-minute phone conversation with the company to learn about their existing processes, the tools used, and the challenges related to M&A processes.

“Based on this information, we can make a customised demo that showcases how Midaxo’s solution can address the company’s challenges.”
Some of the leads come from Midaxo contacting potential customers. M&A prospectives are met at various events, but they are also pursued by phone or email.

“Not all of them respond, but surprisingly many of the contacts lead to further conversations,” Linehan says.

Selling cloud services takes skill

Jennifer Linehan has more than a decade of experience in sales and leadership positions in cloud service companies. She was a founding member of HubSpot’s international headquarters in Europe.

She says that successfully selling cloud services requires these things, among others:

Regional focus based on customers.

“Centralising cloud service sales to a particular geographical region is difficult in advance. In fact, it makes sense to monitor where the most customer contacts come from and then direct the sales focus to where the demand is emerging.”

First customers, then an office.

“Marketing cloud services is a global activity. But before establishing  a sales office, it is advisable to consider the customer potential of that specific market. A local presence helps to develop the sales and content of the service so that it’s better suited to local needs.”

Recruit the right people.

“A fast-growing startup needs new employees, but successfully recruiting for sales and other key positions is challenging. It is extremely important that only A-class players are added to the team. For example, an entrepreneurial spirit is a must. A lot of problems can be avoided with the right recruits.”

Midaxo

  • Midaxo is a cloud service company established in 2011. Their software platform helps companies manage mergers and acquisitions and execute other business operations.
  • The company is headquartered in Helsinki, where it has mainly product development activities. Marketing and sales are centralised to offices in Boston and Amsterdam.
  • Midaxo currently has 40 employees. The intention is to grow the headcount to 65 by the end of 2017. See open positions.

Jennifer Linehan

  • VP, Global Sales, Midaxo.
  • Education: Bachelor of Arts, Indiana University Bloomington.
  • Career: management positions in sales, marketing and business development at HubSpot (2011–2016) ja Compendium (2008–2011).