The following interview is a conversation we had with Andrew Butt, CEO of Enable, on our podcast Category Visionaries. You can view the full episode here: $156 Million Raised to Build the Future of Rebate Management
Andrew Butt
It’s great to be here. Thanks for having me.
Brett
Yeah, no problem. So, before begin talking about what you’re building, let’s start with a quick summary of who you are and a bit more about your background.
Andrew Butt
Sure. So, I’m Andrew B***, as you say, Сo-Founder and CEO of Enable. I was born in the UK, quickly became interested in computing, and built a couple of software companies in the UK before co founding Enable and really seeing this huge opportunity, and we’ll talk more about that the more passionate life is actually flying. So I met a lot of my original business network through a flying school where I was building their software, and they were very kindly giving me flying lessons. So that’s a little bit of background.
Brett
Wow. And do you still fly then, on a regular basis?
Andrew Butt
On a regular basis. I think since I moved to the Bay Area from the UK, I’ve been so focused on the business and we’ve been growing so fast. There’s not been so much free time, but definitely something I’ll go back to.
Brett
Amazing. And two questions we’d like to ask just to better understand what makes you tick as a Founder and as a leader, what CEO do you admire the most and what do you admire about them?
Andrew Butt
I mean, I think from a CEO perspective, frank Saluteman, who currently is running Snowflake, is just phenomenal. I think he might be one of the best CEOs that’s alive today. When you take out people, unfortunately, like Steve Jobs, who’s no longer around. And I think his book Amp It Up, is fantastic in terms of that kind of focus and that velocity and how to really kind of go big and how to think about the future and then work backwards on how to get there, as opposed to incrementalism, which is definitely not good for building a company.
Brett
Yeah, I just finished reading his book as well, and he is a beast. There’s, I think, no better way to describe that guy. He is an execution machine.
Andrew Butt
Yeah, absolutely.
Brett
One thing I really liked in his book that he talked about was the idea of declaring war and having an enemy. I think his actual quote was War on incrementalism, which I think is just very powerful and very useful. I think for all founders to keep in mind.
Andrew Butt
Yeah, that’s so true. And I think the success he’s had so consistently, data Domain and then going to ServiceNow and then Snowflake has just been a phenomenal track record.
Brett
Absolutely.
Andrew Butt
And what about books?
Brett
Is there a specific book that’s had a major impact on you as a Founder? And this can be a business book or it could be a personal book.
Andrew Butt
Yeah, I mean, probably lots of them, I think good to Great by Jim Collins, quite old now, and another old one is Crossing the Chasm, which really was a good wake call. But to answer your question, what’s had the greatest impact? I think some of the Patrick Lencioni series. So, five dysfunctions of a team and most recently, the advantage. The Advantage is something I’ve used in the business with my executive team and it’s definitely had a really positive impact on the whole team and the whole company.
Brett
Well, let’s talk about the company. So what’s the origin story behind Enable?
Andrew Butt
Sure. So the origin story goes back again to those flying school days and I met the owner and Founder of what’s now the largest distribution company in the UK, a company called DCs Group, and he was learning to fly helicopters and I was kind of there building software applications. And as we got chatting, I really began to see how there was a huge amount and an increasing amount of income coming in from suppliers in the supply chain in the form of incentives and rebates and all kinds of other kind of incentive programs. And this clearly was becoming a huge part of profitability in the supply chain and also a real growth driver, but there wasn’t any modern software to manage it well, so all kinds of distributors and retailers were struggling. And then on the other side of the supply chain, the manufacturers were also finding it hard.
Andrew Butt
So that ultimately led to us creating a modern cloud solution to manage that whole space.
Brett
And what is the status quo for rebate management today? How do most organizations go about managing it?
Andrew Butt
So it’s really kind of all sorts of manual systems, home built systems, excel spreadsheets kind of limping along trying to use active ERP systems which don’t do this well, so it’s really kind of badly and manually run.
Brett
And is rebate management an established market category or what are your views there on your market category that you’re in?
Andrew Butt
Yeah, I’d say it’s not established. So a lot of these companies and some of the companies we’re working with are the world’s biggest companies and even they don’t necessarily know that this type of software exists. So certainly rebate management is something which everyone in the supply chain does, but despite that, there hasn’t been a recognized category, and it’s that category that we’re creating.
Brett
And can you talk me through some of those category creation efforts and what you’re doing to create that category?
Andrew Butt
Yeah, absolutely. So I think first of all, it’s a lot of education, so we are creating a lot of content. Best practice guidance on how to manage rebates, how to do better through effective rebate management. We’ve created more recently a community which is really putting rebate managers on the map and showing how they actually can have a huge strategic input into their business. So we’re helping to kind of elevate them and give them content and equip them. And then also being modern cloud software, it’s very much on demand, so we’re making it very accessible, very easy, very kind of fast time to value so the cloud principles can apply to this new space.
Brett
And community led growth is something that we’ve talked about a lot on the show in the past and it seems like there’s two core types of communities. You can have community of practice or a discipline or a community around the product. Which approach have you taken it? It sounds like it’s a community of practice around rebate management.
Andrew Butt
Yeah, that’s a great thought in terms of how you would do that. I think that’s right. I think we kind of see that our mission is more than just creating a piece of software, more than creating a product. It is more about a movement and a practice, to use your word. So yeah, I think we’re creating that community around the practice and then if the software can help those guys, then great. But that probably is a secondary consideration.
Brett
And I’m guessing there’s no one really championing for rebate managers. Are you the first ones to really call them out and say, hey, you’re underserved, you deserve these tools and let us support you?
Andrew Butt
Very much so. Very much so. And these guys often might find it hard to explain to their colleagues and friends what they actually do. I think you’re right, they are underserved and just not kind of celebrated at all. And these guys really are moving the needle. They’re having a massive commercial impact for their companies and their customers. So we’re definitely putting them on the map.
Brett
Amazing. One of my favorite category creation stories is from Gainsight and they did something very similar with Customer Success. They realized that Customer Success Managers, it was a title that was growing, but they were underserved. Everyone just kind of s*** on them and didn’t really respect them. So they said, hey, you’re important, we’re going to celebrate you and we’re going to build purpose built tools, we’re going to build community. And they’ve really used that very successfully to build their company. So it sounds like you’re doing something similar here with rebate managers.
Andrew Butt
Yes, that’s exactly right. I think it is a great example. And I remember hearing the number of job titles for Customer Success Manager on LinkedIn was literally a few thousand. And then they came along and it turned into hundreds and hundreds of thousands of people. So I think we’re also actually increasing the population because a lot of our customers already do this and we’re just helping them do it better than others. Kind of have been considering launching a rebate program and they’ve used us as the catalyst to launch that. So we’re kind of growing the population as well.
Brett
And what size company does it need to become a sole function where they need to have a rebate manager versus just having rebate management be part of a different titles workflow?
Andrew Butt
Yeah, it’s a good question. So I think anyone in purchasing and anyone in sales will be negotiating with their suppliers and customers and could be creating rebates and incentives as part of that. And then the rebate manager is probably a bit more of a finance function. So is trying to translate those commercial agreements into financial accounting and accruals and so on. So you probably want to have maybe half a dozen people negotiating these agreements to then have a full time rebate manager.
Brett
Makes sense. And from day one, did you set out to create the category? Obviously a lot of the founders that we speak to and just a lot of SaaS founders in general today aspire to be a category creator. But it’s hard, it takes a lot of time, it takes a lot of money, and I think generally people are somewhat afraid of going down that path. For you, was that clear from day one, or were you considering trying to make this part of an existing, more established category?
Andrew Butt
Yeah, I think when I was before I came to Silicon Valley, icloud looked at other companies that were creating a category, like you said, gainsight with customer success, others. And I guess I wasn’t completely sure, because like anything, there were a small number of very small companies doing something in the space. There was something going on, but it was just very low profile. And then I think as we’ve grown, then I’ve learned that we really are creating the category because like you said, we’re investing heavily in terms of effort, time, resources and money and creating something which is well known or certainly becoming well known, and also something that the kind of majority of customers can adopt. You don’t have to be like a visionary or like a really early adopter. We’re creating something which is mainstream. So I think in that sense, to answer your question, I’m not sure if I always knew were creating category, but it definitely feels like that’s what we’re doing right now.
Brett
Amazing. And to reference something you mentioned earlier in the interview, crossing the chasm, where are you in terms of crossing it?
Andrew Butt
So I think if you look at say, distributors, and we’ve got distributors now in many industries ranging from automotive to electrical to pharmaceutical and many others, and also in many countries, by the way, so UK, US, Canada, Australia is our most recent market. So with that market, distributors who are trying to manage rebates with their suppliers. It’s getting quite advanced and we’re probably in the early majority, I would say early majority now. And then I think if you look at, say, manufacturers and the rebates they pay out and managing that, then that maybe we’re a little earlier. We started focusing entirely on distributors and then it was actually through network effect that we got into the manufacturers. So that happened a little bit later. So we’re probably still with the somewhat visionary customers in that space.
Brett
And do you envision the pitch is going to have to change as you move away from visionaries?
Andrew Butt
Yeah, and again, we’ve kind of been through that cycle with the first part with the distributor side already and it certainly did change. I don’t think it was a complete kind of revolution, but it definitely the way that we implement and the commercial model and how we make it kind of easy for customers did evolve.
Brett
And are there any numbers you can share just to highlight some of the growth that you’re seeing?
Andrew Butt
Sure. I mean, I can tell you about our team. So when I came out here two and a half years ago, were about 80 people. And we’re now about 450 people. So that’s the kind of growth of headcount in two and a half years. You mentioned the fundraising, so were bootstrapping. We bootstrapped our way to probably about 25 customers and then we’ve raised 156,000,000 in the last two years. So that’s obviously been a huge change. And then in terms of companies using the platform, we’ve now got just over 10,000 companies that use the platform. That includes our immediate customers and then some of their kind of trading partners who also use Enable. And it’s growing very fast. We’re about 150% up year over year right now.
Brett
Wow. And do you think you could have achieved the success you have so far if you weren’t in Silicon Valley?
Andrew Butt
I think it’s possible, but I think it’s not likely because I really think the whole ecosystem here and in terms of talent, some of the people we’ve brought on board, very skilled operators that have achieved hypergrowth before, and we wouldn’t have kind of bumped into them just in anywhere. I think being here has helped on that. And I think from an investment point of view, investors here really understand, again, how to build a really big company of consequence, which does involve investment and spending money. And that’s something which isn’t really understood in other parts of the world, makes.
Brett
A lot of sense. And what have you done, do you think, successfully, if you reflect on this growth? What have you done to rise above all the noise in the market and capture the attention of early customers?
Andrew Butt
I think a big one is the return on investment that we can deliver. We’re fortunate that in this category we can show hard dollar impact quite easily. So we can show, for example, that distributors and retailers are not claiming the full rebate that they’re entitled to because they’re not tracking it as well as they could be. We can show how a manufacturer could be getting more revenue for their rebate, dollars that they’re paying, and many other things as well. So we have a process called business value assessment, where we get inputs from a prospect which they agree to. So it’s their inputs, and then we play back to them how we can give them a payback in maybe three or four months. And we’ve done that so many times now that we’ve got lots of case studies and references of customers who will get on a call and say, yes, we bought this system, and within three months we got all of our money back and more.
Andrew Butt
So that has definitely helped us.
Brett
Wow, that’s very powerful. Especially in today’s climate, being able to demonstrate ROI, I think, is very critical.
Andrew Butt
Yeah, certainly.
Brett
And in terms of go to market, what would you say was your number one greatest challenge and how do you overcome that?
Andrew Butt
I think education has been quite a big thing where there have not necessarily been a lot of people out there looking to buy this. They didn’t really know it existed. So it’s not like an HR system or a CRM system where a company says, right, we’re going to market and we’re going to buy a system. And then it’s simply showing them why we’re the best system. It’s actually explaining why they should do this in the first place. And that, I think, has been a challenge, which has been getting easier as the software has become easier and easier to adopt, and the commercial model has become very kind of easy to accept, and the risk for the customer is very low. But nevertheless, we’re trying to show them that this is a better way and that they should create a business case for something they weren’t previously going to do.
Brett
And that’s the downside. Right. Whenever it’s a category creation plays, you don’t just have to create product demand. You have to create category demand and then create product demand. So it’s two funnels that you’re essentially trying to create at the same time.
Andrew Butt
Yeah, exactly. And I think the other side of that is there can be a huge opportunity for success because typically with an established category, you’re looking at presentation rate of how many prospects out there are actually in the market to buy something now versus in the future. Whereas for a new category, people didn’t necessarily know they were in the market until they saw and found the solution. And then if you create a good business case, that suddenly they are in the market. So I think it works both ways, for sure.
Brett
And in terms of your category creation efforts, how important do you think analyst firms like Gartner and Forrester are?
Andrew Butt
I think they’re pretty important and we do get quite a lot of referrals, not necessarily directly from those guys, but companies come to us and they say, were speaking to Gartner Forrester or others and they said, you are the company to look at, or suggested we do look at you. And also it works the other way, where we’ll find a prospect directly or we’ll go outbound and talk to someone and they will then say, right, well, we’re going to ask Gartner their opinion or ask for their opinion. And that opinion definitely is influential. So I think it’s pretty important.
Brett
Makes a lot of sense. Last question here for you. If we zoom out into the future, what’s the three year vision for Enable?
Andrew Butt
Yeah, I mean, we definitely are building something of scale here. The fact is, every B to B company has different types of incentive agreements with its partners, with its suppliers, with its customers, and we want to be the definitive platform that everyone uses. We want to be just like DocuSign is the standard for Esignature, we want to be the standard for any B, two B incentive. So we’re looking at big scale and I’d say certainly over, say, a five year period. We’re now at, say, 10,000 companies on the platform. I’d like to see that being a million. I think we can get to a million in five years. We’re currently in about five countries, UK, US, Canada, Australia and others. And we’ve got customers in about 20 countries right now and I think that will grow to maybe 100 countries in five years. And we really want to be a platform, so it’s not just, again, a piece of software to manage incentives, but a platform where companies can manage their existing trading relationships and also discover new trading relationships and new incentive opportunities.
Brett
Amazing. Andrew. Unfortunately, that’s all we’re going to have time to cover for today’s interview before we wrap. If people want to follow along with your journey as you build, where’s the best place for them to go?
Andrew Butt
I would just say go to Enable. It’s a really easy to remember URL and we’ve got all of our social media there. I personally am on LinkedIn and use LinkedIn as my main platform. Social media.
Brett
Amazing. Well, thank you so much for taking the time to chat, talk about what you’re building, your category creation efforts and the vision. This is all super exciting and we look forward to seeing you execute on this vision.
Andrew Butt
Thanks for having me. Great to be it.
Brett
All right, keep in touch.
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