Pieter de Villiers On Raising $109 Million To Help Businesses Communicate With Their Customers

Pieter de Villiers operates and innovates at the intersection between communications and commerce. Where he has been creating a world in which we never have to suffer with being left on hold by a brand again. His venture, Clickatell, has raised funding from top-tier investors like Arrowroot Capital Management, Bossanova Investimentos, Endeavor Catalyst, and Harvest Partners.

In this episode, you will learn:

• Pieter de Villiers top advice when launching a business
• How chat commerce is changing the world, and brand experiences
• How big Clickatell is today

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About Pieter de Villiers:

Pieter is the CEO and one of the four co-founders of Clickatell, the leading SMS website in the world. Starting his career in 1997 in the optometry field; Pieter has over 10 years of sales, new business management, and product development experience under his belt.

During this time, he took a radical shift in his career and accepted the opportunity for a partnership offer, and moved into the IT sector. He joined Micrologix in 1999, whereby his primary responsibilities included the identification of internet-related opportunities and the management of its e-commerce strategy.

Pieter recognized early in the game that the need for a single point of entry for global text delivery was essential for market penetration and adoption of this new mobile technology. So in February 2000, Pieter made the decision to invest in developing mobile communication strategies and became a founding member and CEO of Clickatell. Today, Clickatell is recognized as a worldwide leader in mobile messaging, providing services to over 10,000 enterprises in a variety of industries.

Pieter participates in various forums and interest groups, including but not limited to the GSM Association (www.gsm.org), Wireless Internet Caucus (www.ctia.org), Open Mobile Alliance (www.openmobilealliance.org), Wireless Application Service Provider Association (www.waspa.org.za) and the Mobile Data Association (www.mda-mobiledata.org).

Connect with Pieter de Villiers:

• Crunchbase
• LinkedIn
• Facebook

Read the Full Transcription of the Interview:

Alejandro Cremades: Alright, hello everyone and welcome to the deal maker show. So super excited about the guests that we have today I mean we’re going to be talking about building scaling and financing. You know all the good stuff and you know the founder that we have Today. He’s been at it for over twenty years I think that you know a lot of listeners learn here that we’re going to be covering. Ah, without far ado. Let’s welcome our guests today piere devilis welcome to the show. So you’re originally from South Africa so give us a little of our walkthrough memory lane. How was life growing up.

Pieter de Villiers: Um, like Yeahandro great to be with you.

Pieter de Villiers: Yeah in South Africa is a great place. You grow up as a kid you have beaches um sunny weather a lot like Australia in many ways from a climate side. So as a child you carefree. Um I was lucky. Um. My dad traveled internationally a lot so we had an Apple to computer 9084 and our love for computers really started back then and um I studied science degree in optomology realized it’s not the thing for me. And did the transition over technology with inoptometry and I’m very happy to be a technology founder and an entrepreneur today.

Alejandro Cremades: So at what point do you realize that technology is is really you know your passion.

Pieter de Villiers: You know when you when you see what you can achieve with scale. Um, you know if you if you do something on on ah on on simple technology platforms and you can repeat it. It’s it’s totally um, ah amplified. The outcome if you think about opttometary as a profession you’re spending an an hour at a time or 30 minutes at a time consulting and simply you’re constrained by a number of days in a number of hours in your day. So um I realize pretty quickly that whenever your constraint is time. Technology going to have to be brought into the mix in order to to amplify and scale all your outcomes and so um, that’s pretty the moment.

Alejandro Cremades: So in your case you know like you decided to get together. You know with a few friends you know and and and and family members and then that was really the beginning of a journey So tell us how did that happen.

Pieter de Villiers: Um, yeah, it’s a fascinating story. Um, we were inspired by the whole dotcomboom and in late 99 early 2000 we felt that the internet is so new and and so fresh that anyone could get in There was no experience sort of required. Um, it was a new frontier. It’s almost like web 3 these days that you know a lot of people can get into it early on. Um and so we thought about building an ecommerce website back then only 2 things made money gaming or adult content and then travel. And we were never going to go to our parents and tell them we were going to start an adult content site so that wasn’t going to happen. So um, yeah, we looked at last minute travel deals flight deals. This was the same time when you know lost low-cost airlines bluere and and grew tremendously and.

Alejandro Cremades: Ah, right.

Pieter de Villiers: When we did the first sort of use case. We realized that this 48 hour travel deal that we were going to send to all of our expat friends in London and Australia and in the us um, would expire before they even got the notification because yeah, these were excess seats. And the next forty eight hours and so for our optometry days I remember that we would send information at way. It’s important and timecritical we we could send this information by a pager but we weren’t going to give every human on the planet a page out of course and so um, we also realized that most of us.

Pieter de Villiers: Ah, in a high income group started having mobile phones so we looked for ways to send the alerts about this travel deal. Um via mobile texts um spent three months on altivvis 10 x site to try and find the solution did not exist and we were crazy enough to go build it. And click a tell click for ah the the internet and and the world fastergoing commerce platform and tell for telecommications the book faster growing communications platform was born in June 2000.

Alejandro Cremades: So let’s talk about then you know the company being born I mean what? what were some of the next steps that you guys say took because I mean obviously you know you guys also build a first messaging Api. So I mean that’s quite ah, an accomplishment. You know those were the early days to me. We’re talking about twenty two years ago I mean it’s a long.

Pieter de Villiers: Are.

Alejandro Cremades: A long journey here. You know that you’ve embarked in. So so tell us about those first initial steps you know, really that you guys took us as a business.

Pieter de Villiers: Yeah, you know this was before Sas before cloud before apis even um, was was a mainstream thing even before product led growth was a mainstream thing and so um, we just you know published 4 lines of code. On the web. Um, and said anyone who wants to send messaging or mow text from their website or homepage could then you know get this little widget that would enable that and within three months we had um more than 76000 websites patent paste this code onto the html code for their own page today that won’t happen like your security officer will never allow you to do that? Um, but we had massive adoption. Um, because it was really the wild west at the time. Um, but a few things happened without us even planning it. Almost the stumbling into it which is hey we were not going to collect money from clients in India and the Uk and the us there was no way we were sitting in cape town. So having an online payments mechanism and credit card ah transactions for message credits that was a logical thing. And before we knew it we had thousands of clients all over the world because then there was no boundary in terms of who can use the product in the service. Um, it was an api for lines of code. So back then um, it was super simple and and had to make sense. But then you had to get reporting so.

Pieter de Villiers: As as found as we we found a problem that we felt um, was was interesting enough to solve. Um and when we made it available at that time for free. Um, we realized there was a lot of interest in it. But within yeah several months. And not too long. We had to shut down the free offering because messaging wasn’t free to us. It cost us a fortune and when you start sending millions of messages. You realize that someone has to pay the balls and so we had to transition into a paid for model within a couple of months and that was the.

Alejandro Cremades: And and that leads me actually to to the next question and that is that 22 years you know is a lot of years serving customers. So I think that in this case, how would you say that the business model of the company has transitioned over the course of time.

Pieter de Villiers: The role start of the company.

Pieter de Villiers: Oh.

Alejandro Cremades: To where it is today and how are you guys? Essentially you know monetizing and making money today. Okay.

Pieter de Villiers: Yeah, twenty years Twenty two years feels like a lifetime in many ways it is in technology right? I mean we went through the dot com crash because June 2000 wasn’t the crash eights right? It was the the runup to at 2008 we um, we had to navigate and then of course even more recently. So it seems like a very long time in technology and a lot of entrepreneurs would typically bail out between six seven eight years because that’s typically the the fund lifecycle for the venture capital firms that invest in into them. So um, but for us. Because we were so early when once you’re a first mover in any technology set. Um, it takes a tremendous amount of time for the market to adopt that technology set or that new behavior. Um, so for us we’ve we’ve never had a negative growth here in the history of the company. We’ve bought one hundred.

Pieter de Villiers: $30000000 business. Um, ah plus worth less than $20000000 in capital and so we were we were arguably perhaps too conservative will me started um as non-us entrepreneurs I moved to the us in 2006 and so I really sort of you know, opened up my eyes in terms of what what is possible. And essentially um, when you’re solving real world problems and realworld sort of challenges with businesses then you’re not, you’re not monitoring the clock percent. How long have you been at it. The market is really just opening up now and and we think that the um, the biggest opportunity is still ahead of us.

Alejandro Cremades: Now in that regard you know talking about like moving here I mean you moved here because it really came to light from the interest that you were getting from Seoia. You know that you needed to be um, a Us Business. So I Guess say what? that leads me to to really you know wanted to ask you about. The capital side of things. So How much capital have you guys raised to date and.

Pieter de Villiers: Well, the the um the capitals restart with the with the angel investment would be. We bought an $11,000,000 business with about $67,000 angel investments a very small check. Um, but it took us 6 years you know you you don’t get to $11,000,000 with $7000 investment in a year it takes time to build that up but that we did that and that got the attention of of us Sand Hill Road Vcs when we showed up um in late 2005 and we could show in our metrics so we sequi led as a serious a around. Um. Back in two thousand like two thousand and six of ah $6,000,000 and then they laid the the series b round in 2011 um, was a 12 minute b round and I laid that round um as well with dag ventures coming in in on that round. And then we were quite frankly, um, very much building out the tech stack because we were also profitable. Um in that phase and so only this year in march that we raise a $91,000,000 series because only now do we believe that the market post covid and post digital transformation. Is ready for for commerce in chat at scale.

Alejandro Cremades: So that’s in total about a 9000000 is that right? give or take.

Pieter de Villiers: Yeah, it was a given take to twenty Twenty million up until early this year plus the night ninety one in March this year

Alejandro Cremades: Okay, got it. Got it. So so in in in that regard. You know the first day financings were on the tougher end I mean I believe that you actually on the angel site you were literally like one week away before you were able to secure a check. So. What were those days like.

Pieter de Villiers: Yeah, you know entrepreneurs I think a basic group to to handle those days or those mini crises which is um, this and unwaving belief in what you’re doing um and and so yeah. Before we before we we got our angel check a lot of entrepreneurs by the way outside the us face this capital availability cost of capital in non-us markets. You know is very difficult. It’s changing now. Thanks to organizations like endeavor and um, lattime uruguay you know? ah. Spain turkish entrepreneur being great even israeli entrepreneur doing great in the market. So that’s all changing now. But back then it was very much a tale of have and have nots and and so um. Generally entrepreneurs in those emerging markets had to be a little bit more resilient and resourceful of navigating some of this but um, yeah, you, you don’t think about the fact that you know seven days from now you will have to shut down your door you close your doors or shut down your business. You really. Live at that point in time from day to day and 1 step at a time.

Alejandro Cremades: So And and and also for you guys I mean coming to the Us was something that came to light during the conversations with seoia or given the interest of secoia which is one of the best investment Firms. You know for venture capital in the World. So. Tell us about how those conversations you know came to light and and at what point do you realize hey I think that I’m in the wrong Market. So.

Pieter de Villiers: Yeah, you know we we were the first company to bring text notification to the us. Um, we did that in two thousand s and 4 and 5 for visa um, um, when we met them at a conference and so back then text messing was very much. Lala Puluza american idol voting type things. It wasn’t at all your 1 ne-time pens and things like that. Um, so the us was a big market. Um, we landed oracle as a client that’s from Cape Chan um Oracle wanted to do more than than just sort of wanted 2 use cases. So. Really started seeing traction in our us market and client base. Um and realized that the us market could potentially be at that time. Our largest market opportunity. Um, so but at no point in time we’ll be going to be able to find a us expansion with South African Rands based sort of venture. Um, the exchange rate was one 2 to 9 at the time and but this didn’t make sense so we looked around at where should we try and do a series a investment round most of african entrepreneurs go towards Europe. Um, because of the commonwealth linkages. So London and Amsterdam are typically where you would find entrepreneurs. Um, go to find their funding your owns but we felt that because we had some us traction and clients that that the us made more sense that the the cost of capital in the us was less as well. Um.

Pieter de Villiers: So we did go up and down sandel road and um, yeah, pitched the business and we ended up with 3 term sheets and at the time square term sheet ah was um, as competitive as as at least one other and. And from the brand perspective which which I as a quite fun story was that um, our partner on the deal was going to be ruleoff but at the time he was in the same week. Um, he was being pitched by the Youtube founders and so he got pulled onto the Youtube deal. And yeah, that’s a bit of fan fact.

Alejandro Cremades: Wow And how would you say that the the I would say the fundraising environment because I mean now you you’re able to really benchmark to you know with with previous rounds that you’ve done and you’ve been raising you know money since the early two thousand S so how would you say for the company.

Pieter de Villiers: Ah.

Alejandro Cremades: How would you say that the market you know the fundraising landscape has changed and what kind of um how has it been for you to go from one cycle to the next over the course of all these years too

Pieter de Villiers: Yeah, it’s a great question. Actually I mean I think I think a few fundamentals hasn’t changed um and and those center around. Um you need access. So um, we. You need someone to make a safe introduction or friendly introduction for you. Um to the funders because they’re not going to open up the email and check the mailbox. So so I think access is important I think again organizations like y combinator like endeavor they’ve they’ve almost democracy. Access perhaps you found as that we’re not studying at at Harvard or Stanford or in in the network for site. Um outside of access. That’s that’s universally still the same. Um, you actually do need to have a real ah value proposition. I mean I think we were. When we showed up, we were lucky to be able to really show emerically that there’s massive market product markets foot and demand for what we were doing um and so I think that that in in the in the boom times you can get away with slideway and and the promise of a dream. But. But think the momentv the mob contracts and the fundamentals start to merate and so we actually are on that space right now where fundamentals um are very important and I believe in this moment entrepreneurs are a little bit more um, levelheaded and and and sort of sound in terms of their.

Pieter de Villiers: Core value proposition have a better chance of getting funded um than entrepreneurs that that’s just taking a punt at something that they think has the right buzzros in it. So So I think the market is quite fluid I mean the the beautiful thing about Capital Markets is as brutal as it is. It’s also quite um, ah sobering and and realistic in terms of of how it corrects itself. Um, so I think some of the best entrepreneurs um now can get funded especially early stage. Um, and some of the fluff that we had the hype versus versus Lifestyle of opportunities. Yeah, the the the market in the in the pipeline will purge itself. So I think it’s a good time for for solid entrepreneurs and it’s not so good time for for. Get rich quick schemes.

Alejandro Cremades: Now in your case I mean you were one of the first markets I mean if not the first and I think that when you’re launching something for the very first time is not about educating you know potential customers. It’s about educating the entire market you know or opening a new market that doesn’t even exist. So. How was that challenge for you guys and and what were some of the steps that you took in order to really ramp up and accelerate. You know, succeeding on that. So.

Pieter de Villiers: Yeah, yeah, and it’s’s it’s a question that we grapple with quite a bit to many the the reality is that the first first movers don’t typically win the race right? I mean if you think about myspace and altavesta and. Yeah, some of the some of the predecessors to Google and and and and facebook matter. Um, so the reality is that she can spend a lot of energy and effort trying to educate the market through thought leadership and and um and innovation and then other companies that iterate on top of that theme then. Can grab the market in some ways. Actually um that that also happened in the communications space companies like Twilio came after us and their several billion dollar business today and very successful business at jefffs bought um, so in messaging we definitely? um. Were were first or um in market because if it existed we would be in travel today. Um, but we learned many lessons around being first to market because we were also now first to market on chatcommerce and being able to do payments in the chat construct and so in this in the second. Solver of being first to market. We’re really being mindful in terms of how we um, empower our clients to do incredible things and not give up that that that much um to a quick follower or a me too company.

Alejandro Cremades: And and and and 1 thing that I wanted to ask you here. Is you know if you had the opportunity. Let’s say of going to sleep tonight and you were to wake up in a world where the vision of clicka tell is fully realized. What does that world look like.

Pieter de Villiers: What it’s a world where we never get placed and holds by a brand ever again I mean I think this idea I’m I’m you know, fortunate enough to be a a platinum whilst fogo credit card holder it. But it means nothing. You know you feel good because it says Plathtinum because somebody sold you this idea that it is better than than the than the regular car but it’s not It’s no better and when you find the platinum number um somebody answers the phone you know, call you by your first and last name um I need to hand you over to the general call center number of whilst fargar. But you’re being placed and hold for 34 minutes plus and so this idea that brands place as and hold up to 17 hours per annum um, all the time. Um, where we can spend that time better. Um I think is is something that that. Ah. If our vision it gets realized then people will never be placed and hold by the brands they engage you ever again and we can use that time much better for things we we enjoy.

Alejandro Cremades: And for the people that are listening to get an idea too of you know the size you know of of the company to them I mean anything that you can share in terms of number of employees or anything else that you feel comfortable sharing. So.

Pieter de Villiers: Are.

Pieter de Villiers: Um, yeah, look. We’re a private companies so we don’t always give financial information but the companies and 350 employees and that information will be available on link and we have first off the largely riskkers San Francisco um Atlanta toronto cape town even Lagos um Nigeria um, we do innovation at the intersection between communications and commerce. Um, which really is a place. Yeah you and I rearrange our lives in chat. Yeah, a school pickup or a lunch with a friend and all we do as a company is enable brands to serve us inside those chat platforms. We already use. It’s a very exciting space. We have incredible stuff staff and and talent to help us build out this vision. Um, and in terms of science. We do about one point five million payments per day as you know ah several hundred million per annum um ah in a communications channel which is quite unique. Um, and then we do billions of messaging and interactions per annum. Ah, for. Ah, clients from banks to insurance firm to talco companies to to your local um ah franchise.

Alejandro Cremades: And 1 question that I wanted to ask you is you know you’ve been at enough for 22 years I mean 22 years is a long time. You know how? how do you think I mean typically you would see founders that have been at it. You know with with eyes. Individual giving company for like maybe like up to 12 years and you know and then they they get bored and then you know like they just jump ship. They do something else. What do you think has kept you going for so long.

Pieter de Villiers: Yeah I think you know if you think about all of our Journeys and this journey of you know learning and and growing. You know we were lucky the the company never had a negative growth here. We’ve always been up and to the right in terms Of. Of revenue and Clienttainment. So um, the founder I was when we started the company when we were 4 people. It’s different. The founder I am now with international offices and global clients and so um I Guess what? what kept me interested and and gave me a sense of purpose and my team. It’s very much that we can see constant growth and and expansion I Do think that’s founders that and we will be very responsible in our capital raising right? If you if you if all you want is unicorn status. Um, and you engineered that unicorn status through all kinds of debt and all kinds of you know, unrealistic valuation sort of elevations then pretty soon the pressure gets so big on the entrepreneur. Um, to make good on those promises that it’s no longer a fun place to be and you’re almost better just to you know, call quits than to keep at it but we never did that we we bought this business. You know with La and K and that threaten in chairs of many many years.

Pieter de Villiers: And it’s a solid business that serves real clients with real incredible art camps and so um I’m loving what I’m doing and and touch with I’m I’m still very very much en a adjust.

Alejandro Cremades: It’s all about loving it as they say when you love what you do, you don’t work a day in your life. So so that’s what this is all about so so Peter 1 question here that that I like to ask you that I typically ask the guest that come on is if I put you into a time machine and I bring you back in time maybe twenty two years ago

Pieter de Villiers: The election.

Alejandro Cremades: When you were thinking about you know, starting you know the business and you had the opportunity of giving a piece of advice to your younger self before launching a business. What would that be and why given what you know now.

Pieter de Villiers: I Think it’s always the same answer I haven’t you know I would be surprised. Um, if it’s anything different I think that um people I mean we we’re not entrepreneurs and bowlers of technology companies a technology company.

Pieter de Villiers: Really people innovating and building technology. So at the end of the day we all run people’s businesses and so as a technologist understanding. Um, how important that is is something I didn’t I didn’t realize yeah when you when you start a business with with the twin brother. And twomates you know the people think Iss almost solved for because you all like each other and you all know each other and there’s no people issues to think about? Um, but as you grow um the the company you realize oh my gosh culture and values matter a lot. You know, getting that. Arrogant but brilliant person on board is not going to work out. Ah very well and so I think my my my main main theme around advice to myself would be pay attention to the people matters. Um, and when in doubt you know? yeah.

Pieter de Villiers: Dont and hire the person that that you not share.

Alejandro Cremades: I love it and for the people that are are listening. You know, right now Peter and and when I reach out and say hi. What is the best way for them to to do so.

Pieter de Villiers: Yeah, you know, um, we’re available on Linkedin. Um, it’s Peter De Valas from clickkata you can easily find me and and and message me on Linkedin I’m not that active on Twitter clearly because um, my team does that and yeah i’ve. I’m a but little bit more private than than most maybe entrepreneurs but you can find me through Linkedin and or direct email better dot click it all, um and look forward to having conversation.

Alejandro Cremades: Amazing. Well hey Peter thank you? So so much for being on the dealmaker show today. It has been an honor to have you with us.

Pieter de Villiers: Thank You Alejandro and all the best with your venture.

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