Buy-and-Build Scaling with Kris Satish

“Once you build something substantial, most decisions are driven by a degree of fear, a fear not to lose. Now, the drive to turn this into something bigger than you imagined kicks in”

Today we're joined by Kris Satish, founder and CEO of Oolio. Oolio is Australia’s largest hospitality technology platform and payments business, serving over 20,000 venues across Australia, NZ, the UK, and the US.

Kris offers his insights on:

• Key initiatives that enable organic growth to flourish
• Navigating the challenges of executing a buy-and-build strategy
• Integrating new brands and avoiding an 'us and them' culture
• Managing the growth from 100 to 500 employees over a few years
• How to avoid letting fear drive your decisions
• The non-negotiables when it comes to business

Guest: Kris Satish founder and CEO of Oolio.

A Pemba Capital Partners Podcast
Host: Mark Bryan Partner at Pemba Capital Partners
Producer: Martine McMahon 

Transcript

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This series is produced on the land of the Gadigal people of the Eora Nation. Pemba respectfully acknowledges traditional custodians throughout Australia. We recognize their continuing connections to country and culture, and we pay our respects to elders and leaders, past and present. Welcome to the first of many episodes of View to the Summit, a podcast tailored for founders looking to scale their business and who are considering an investment partnership. I'm Mark Bryan, one of the partners here at Pemba, and I'm delighted to be your host for the season. Pemba Capital Partners is an investor in high growth, entrepreneurial businesses, and has been assisting founders and management teams for over 25 years. Pemba is a commonly used name for a Sherpa, and that's how we see ourselves. We're the support team helping founders reach their next summit. In this season, we'll delve into the experiences of fellow founders, industry experts and growth specialists, uncovering invaluable insights to advise and educate you and your team on scaling business effectively. So let's dive right in. We're absolutely delighted today to have Kris Satish, founder and CEO of Oolio. Oolio is Australia's largest hospitality technology platform and payments business. The business serves over 20,000 venues, ranging from major stadiums like the Gabba and the MCG to mom-and-pop style cafes. The group has operations across Australia, New Zealand, the UK and the US. And I'm pleased to say, Oolio is one of Pemba's most successful software investments to date, having been partnered since 2019. So Kris, welcome. It's great to have you here. You could describe Oolio as an overnight success that took 50 years to create. You've dedicated the majority of your career to building a leading hospitality technology provider. It'd be great, Kris, if you could tell us in your own words how you came to be founder and CEO of Oolio and also how you ended up in hospitality tech. Mark, thanks for the opportunity. For us, it has certainly been a 50-year journey. This business started in 1973 as a little cash register business in Rockdale in Sydney. I didn't start it. I got involved with the founders of business electronics sometime in the 90s. And over the years, I ended up working very closely with them, playing a major role in building their product, slowly acquired interest in the company, and gradually took ownership of BPOS, turned it into BPOS Group. A little bit about me. I came here as a naïve 18-year-old with a dream actually to become an aerodynamics engineer. Little did I know that it is impossible as an overseas student to earn your living and your tuition fee as an overseas student. And also the timing for me was not right. I came in 1990 in the heart of the recession. Today, looking back, I think the timing was perfect because I would not have had the experience I've had. I started as a student and had to drop out of school because I couldn't pay my second semestitution fee. Like many overseas students have to keep our visas alive. So I did a little diploma in hospitality and also did another diploma in electronics and by chance met an owner of a cash register business and actually started in that business as a delivery driver. That was my introduction to the point of sale and hospitality technology business. As you know, in those days, 32, 33 years ago, it was all cash registers. I took that opportunity, I felt that was the only opportunity I had and took it upon myself to learn more about the business and to actually grow the business. And in fact, that is how I met the founders of Business Electronics. Ever since then, we formed a great partnership with them. In about 2000, we started a new business, bringing technology from Germany as well as Vectron. Over time, we felt the local product, which was B-POS, was more suitable for the Australian market. We contributed heavily towards what B-POS has become. We wanted to own our IP, and that allowed us to take over the business and rename. So you became such a large reseller of the product, if you like, that enabled you to then effectively create a partnership with that business and take that IP. I would imagine that would have been a really big step for the business at that time, and then getting ownership of that IP really enabled you to drive the growth going forward. Well, that was everything. I must say I'm probably an unconventional entrepreneur in the sense I didn't begin with a purpose. It was something I fell into, but about 15 years ago, I really realized our purpose. Once I knew what our purpose was, I felt without having our IP, our own IP, it is impossible for us to deliver on our purpose. And that was really what made us save every dollar, run the business really tight, but really aggressively win the markets and use every dollar we saved in acquiring this IP, taking over BPOS and creating BPOS Group. Tell us about that purpose. That's probably an important driver for you, I'm sure. Yes, it is. Probably for half my 32 years or so, I didn't really realize why I was doing what I was doing, other than it was a business to pay bills, to keep staff happy, customers happy, and something is left at the end of the day. But halfway through my career, it dawned on me that every time we walk into a venue that we've serviced, we see so many people, so many patrons celebrating. They're celebrating birthdays, anniversaries, wins, losses, new friendships, new beginnings. And over time, I realized the power of that and also saw that once you understand hospitality business, you realize not all hospitality businesses are profitable, yet hospitality business owners come back and keep doing it day in, day out. They make a lot of sacrifices. They're not home in the evenings. They're not home on any special holidays, yet they do it day in, day out. And why they do it? I feel they do it because they really are there to facilitate celebration. And that is really what makes it a really passionate purpose for us. If one thing COVID has shown us when the world went into lockdown, we all got a taste of how life would be if we can't celebrate. I love that facilitate celebration. It's really, really powerful. Midway through the journey, so by this stage, you've clearly identified purpose and what's driving you. You've managed to partner with the business, take the IP, got much more control on the destiny of the business. That's only part of the story though, because of course, in the last few years, there's been some other major changes. It'd be great to just understand what's been happening over the last few years. Before we owned our IP, I felt our business was not big enough to serve in any meaningful way to any meaningful size organization. But once we owned our IP, we started winning businesses of all sizes. It could be some of the best non-educational institutions in the country became our clients. The Australian Defense Force, we service all of their canteens, for example. In some way, we were at crossroads. To go to the next phase, it required a lot more bets to be placed. For us to grow, we needed to service more sectors. We needed to geographically service bigger areas. We needed to build our cloud platform. And all of these were very big bets. I feel founders have many ups and downs. You have, when you're on your own, you get a feeling of elation, and then something hits, and then you go into the dip. And sometimes you have moments where you cannot see light at the end of the tunnel, because as a founder, you're by yourself. You have nobody to talk to. You have nobody to pick you up when you're feeling down. You can't go and talk to your team about it because they will not understand this. Lonely place. Yes, it's a very lonely place. And having a good equity partner that understands human psychology and emotions and that is trusting will really help you overcome this. That is something most founders won't get by themselves. Yes, you could go to a coach. Yes, go join some membership groups or CEO groups. But when you get an equity partner, you are aligned. Both of you have skin invested and the feeling is different. But if you look at me, I did 25 years or so by myself. You guys don't have 25 years to sit with me. So we need to together make a huge difference in growing this business in five or six or four or whatever those years are. And it's also people ask me, okay, but you've diluted your share. Yes, but as you mature, you understand economics is not everything. It's also a legacy. If you think about challenges in your career, I'm imagining one of the most stressful periods given you operate in the hospitality space was of course the COVID period. At the time, the business was very focused in Victoria, which globally, of course, Victoria was famous for the longest lockdowns. Can you describe how you coped as a business through that period and what you learned from that time? No one expected COVID, and hospitality was the most impacted industry. I spent most of the first year of COVID building, working with our developers, building technology that will help venues stay opened. It was more about what can we do for our customers to stay in touch with their customers and with their staff and have some income running. Yes, they may not make a profit. Yes, they may not be able to pay all their bills, but at least they will be alive. Survival. Survival. So we focused on line ordering, trying to keep some revenue going into venues. Before Australia announced its JobKeeper program, a lot of organizations jumped the gun, made some knee-jerk decisions. And what did you do with the forcing? Well, I'm glad I did nothing. And yes, there was internally some of our management team were getting nervous and wanting to make some big calls. Maintaining that team, people that you'd work with for years and years. Yes, it is very close to my heart, because we've been through so many ups and downs, GFC and all that, and we've never had to ever, ever lay off a team member. And frankly, we ran the business so tight that we had enough resources to fund our entire team for 12 months if something were to go wrong. And on the growth, so Oolio is growing really fastly on an organic basis. You've been adding new products, new services. You know, we started our journey to build our new platform, I guess, in the middle of COVID actually. We not only kept every single one of our staff members, we actually hired more developers during COVID. Overall, if I were to do it just as Beatbox Group, we probably wouldn't have been able to do it on our own, more for the lack of confidence, you know. So one concept I talk about is, as an entrepreneur, you start with nothing. You build something. And once you build something, fears start creeping in. And once you build something substantial, you don't want to lose. And as a business, most of your decisions, I felt at least, driven by a degree of fear. Okay. Fear not to lose. Right. You need to get to a certain scale to remove that fear, is what you're saying. That's right. You need to get to a certain scale. You need enough diversification, different sectors. Most entrepreneurs and business people find that most of their assets are locked in the business. Once you get a sizable business, you don't want to risk it for your own family's security and your own financial security. Once you de-risk some of that and take some cash off the table, all of a sudden operate with a different mindset. Now your real drive to build and drive to turn this into something bigger than what you imagine kicks in. Makes absolute sense, Kris. I would imagine if we think about Oolio, we've talked about the really strong growth organically that the business has been delivering and continues to deliver. Something that you've also implemented over the last few years is you've gone on a buy and build strategy. So you've made a number of strategically well thought out acquisitions. It would be great for you to run through the thought process, how you determined what those businesses were that you wanted to partner with and what that's meant for the group as well. As I touched earlier, our original product, BPOS, had certain strengths and certain weaknesses, which allowed us to focus on certain segments of hospitality. One of our key reasons for this partnership and this last five years of our journey was to fill the gaps that we had. So hence, some of the acquisitions we made, whether it be deliveries that focuses on QSR, especially pizza, this is something that we as BPOS would never think of. Our target is our technology. Yeah, that's right. At the end, it is a point of sale system, but what delivery does for that QSR sector, for pizza stores is unbelievable. And at the same time, if you look at BPOS, what BPOS does for pubs and clubs is unbelievable too. And they're two different, very different things. And rather than making one product do everything and be everything to everyone, we felt that actually bringing in products, that's platforms that specialize for each sector is a better strategy. And with that, you know, it's not just deliver it. We, as you know, we have Ideal POS, we have Swift POS. For example, Swift POS has been our competitor in some segments, but Swift POS has been very successful in Stadia and Entertainment, and that's not something that we at BPOS could have done by ourselves. We'd contemplated that. But when you see what Swift POS have achieved, recently we went live at MCG. In fact, when we first acquired MSL, which had Swift POS, I was able to be around for the first go live at Marvel Stadia. And that was a pinch me moment for me. I never imagined that a stadium of that caliber, especially being a resident of Melbourne, you know, AFL stadium, that we would be serving a customer like that. And believe it or not, that's a stadium I've knocked on their door for 15 years, and they wouldn't even take my calls. So that bringing in Swift POS really managed to expedite, accelerate, if you like, and I could win those accounts. Absolutely. And that was last year. And then we were fortunate enough to win the Santiago Barnabas Stadium, the home ground of Madrid. And this is a moment to be very grateful, to be able to serve people in distant lands as well. That's such scale, right? 100,000 people at a time. I must say, I emphasize it. Every time I go to a venue, you get this adrenaline kick, and I'm not the founder, so I understand. I understand that. So that gives you a passion and drive. So, Kris, the combination of the organic growth and the buy and build strategy that you've been assimilating as a team has meant the business has scaled five years ago. Just over 100 people, up to over 500 today. I would imagine that's put various pressures on the business. Talk us through how you've managed that change in significant headcount over that time. I think if I look at the countries, we have people in Australia, New Zealand, UK, US, Denmark, Vietnam, Philippines, India, some in Eastern Europe as well. And when you look at this, it's quite a big challenge, frankly. We were wondering how do we do this? We are doubling our size. How do we do it on our own? And that was actually one of our nervous moments. As a founder of a business, most of us are not equipped to integrate other businesses. Having access to people that are good people, that have done it before, and that understand what happens in a business that's partnered with private equity is very important because things move at a rapid pace. And I guess this is one of the additional benefits. You guys have access to talent. What we traditionally probably did in five years, we probably now do in one year, in terms of change. We've also created a lot of opportunities. We have people from different business units moving into different roles at group levels. So being able to provide that career opportunity and growth. Yes. We've now got a people and culture team, which we never had. I'm embarrassed to say I was the people and culture team, but it was just me. I did every interview, I hired every single person over the last five years. It's different now. For dedicated resource doing that. That's right. Tell me, Kris, when those businesses came together, you would have brought in a whole series of new management members as well. And you would have got some great management team within the business. How do you communicate with the management team? How have you sort of set the operating rhythm for the business? For us, when we brought in other brands into the group, we wanted to protect the brand. We wanted to protect the culture of that brand. And that brand should own their culture. The people of that business unit should really be the custodians, not head office. Try to take the best from each business. That was our guiding principle. Because of that, we decided to have a strategy of each business unit operating on product and general day-to-day operations on their own with shared services such as, for example, marketing. HR, procurement, and we also share resources between business units. There's a lot of learning that happens between business units. Because let's face it, one thing that makes me super proud and grateful at the same time is whenever I meet people in each of our business units, there are people there that have been part of that for decades, especially in product. And when you talk to them, you can see they've spent the last 20 years of their life or 15 years of their life for that product. They know that product so much. They're so passionate about that product. Protecting that ownership for them, that sense of belonging is absolutely critical for us. And I think that's what fuels each of our brands, because we never took everything and mashed it up together. And we never go to our customers and try to move them from one product to the other, because we shouldn't bring about that change. Of course, if it makes sense that we have a product that means better for the customer, we would show that product, but we would always leave the choice with that customer. Last but not the least, for leaderships of each brand, and also key people in our own organization, we rely on our management equity program, where once people really understand that and participate in that, there is no longer us and them. You know, traditionally, even when we were by ourselves as BPOS Group, I was the major shareholder, and I had Shiva and Rob with me. Outside of that, we didn't have any of the management shareholders. There are many moments where we feel a sense of us and them. And we tried many incentives, generally never worked. Right. Whereas the MEP, on the other hand, CDF Equity Plan, Management Equity Plan, the Management Equity Plan, basically puts key management and key people in all our organizations on the same ownership structure. Right. So they're no different to our investors or to founders such as myself. There's no difference to me as a founder. Now we get completely aligned on the outcomes. So you've added a number of businesses into the group, and as you've alluded to, that's increased significantly the customer offering. Maybe some of the challenges, touch on some of the challenges for founders that are contemplating and buy and build. What were the key obstacles that you had to get over? Some of the key obstacles would be a lot of businesses, medium-sized businesses, may not have processes that one should have in the business. Once you embark on a partnership like what we have done, you need to be open to building the processes that you should have had many years ago. And that is tough, and believe it or not, it's actually tougher for the founder than the team members, because usually everything that is there or not there is coming from the founders. So the other element we found was, especially when you have a buy and build strategy, sometimes there is competing brands. It could be that some of these brands that you're bringing into under the umbrella are brands that you've competed. So competitive spirit between the groups. Yes, but before, you have to undo that. You have to really show the incoming brand that openness and respect. And really, you have to go probably above and beyond in winning their trust because without that trust, nothing works. You really have to trust them as well and not be fearful that they're playing some game or whatever. And really show your heart and let them see and let them fall in rather than by force. And for us, we've had some brands that came in very smoothly. Some brands took a bit longer. What we found was whenever there was founders involved, it was much smoother. Whenever there was no founders involved, it was a bit more difficult. Well, you've certainly done well there, so that's great. Kris, tell us the question we're asking all of our guests. If I think about you personally, there's probably two or three values or non-negotiables that you like to live your life by, like to practice within business. What are the non-negotiables for you? I would say people are everything. Connecting with people in an honest manner is everything. I always try to touch the heart as much as I can, because that makes me also to feel that warmth in my heart. Second is, if you're in business, you have to adopt a growth mindset. You cannot be set in your ways. We all have our quirks, and respecting each other's quirks is important, but also be open to possibilities. It is amazing when you recognize that there are possibilities beyond your knowledge, beyond your capability and imagination. In my case, books are my friend. They are my guru and they are my coach, learning new concepts. You are seeing how other people have done it before you. I must say you've given me some great book tips, and I love the Unreasonable Hospitality book. That was just a… I recommend that one. That was a great read. And the last one, I would say, is Enjoy the Journey. Okay. And this is something that came to me once again, like the purpose. I did not understand this. I guess you also need to have certain maturity in your age to understand this. Enjoying the journey, enjoying the people you're working with, enjoying moments like I talked about, whether it was Marvel Stadium or even more, more bigger for me than Marvel or Real Madrid was the MCG. MCG is, you know, well famous for many, many reasons, right? Being an Indian, the Mecca for cricket, for example, and for AFL, you know, being in Melbourne, being there for the Goal Live was a pinch me moment. And most of all, when the management of the MCC invited us for a thank you lunch, to thank us for a successful delivery of the project, it was very humbling. I was so grateful that I experienced that. Amazing achievement for you and the team. Yeah, and I had actually used the point of sale at the MCG last week. It's great to see it there up and live. And so, Kris, tell us question really around hospitality. You have, I think, over 20,000 venues across the group. Lots of, as you said, fine restaurants within that group. Might be difficult for you to say a favorite, but do you have a favorite restaurant that the audience would like to hear about? You know, having one favorite is like... Like saying, you love one child more than the other, right? But when I'm pushed for this answer, I always turn back to Grossi Florentino. Grossi Florentino is a Melbourne institution. Iconic. It's iconic. It's one of the oldest restaurants in the country. The Grossi family led by Guy and Liz Grossi, his sister, they've been the custodians of this iconic institution for about 25 years. And I must say, you never get disappointed when you go into Florentino's into a Grossi venue. Their impeccable focus on creating that experience for the guests. It's really inspiring. We send some of our team leaders for a dinner to Florentino's to actually experience what service should be. Very smart. And also for them to feel the sense of purpose of what we are doing as well. Grossi Florentino's is actually our customer and the Grossi family. I'm very humbled for the trust they've placed in me since 93 and so humbled to play a small part in what they do. Brilliant. What a great way to finish this, Kris. I can't thank you enough. It's been really delightful to have you on View to the Summit. That was a wonderful run through your journey and the business. Really interesting to find your non-negotiables or your values, that being look after people, trust and enjoying the journey. Interesting also to hear the mantra around playing to win. And also really insightful to think that a purpose can build over time and that founders when they start out on their journey, they don't actually necessarily need to have that purpose at the outset. So again, Kris, congratulations, deep congratulations on growing Oolio to where it is today, servicing 20,000 venues globally across the hospitality space. Wish you all the best for the continued growth journey. Thanks very much for coming today. Thank you, Mark. I hope you all enjoyed this first episode. Please join us next month when we'll be exploring how founders can scale their business with a founder that's scaled his own business from the private arena all the way to an ASX listing. Hit the follow button so you can see when the next episode drops and rate and review if you like what you heard. Thanks for listening.