Wes Cruver talks about KZO Innovations
June 5th, 2008 by Lisa Singh
Some 25-year-olds are just getting started in their careers. Not Wes Cruver. At the tender age of 11, he co-founded a non-profit company called Kidz Online, which focused on video technology. Then, in 2007, after 15 years of pioneering work in the video market, Cruver decided to start a new company that would sell a product instead of services. Over the past year, KZO Innovations has been doing just that. In the following Q&A Cruver talks about the latest news with KZO, and some of the hot trends he’s tracking in software development.
What led up to your founding of KZO Innovations?
Wes Cruver: KZO Innovations was a long evolutionary process. It started with a non-profit company I co-founded when I was 11 years old, called Kidz Online. So, I have been into technology for over half of my life. We founded Kidz Online as a way to pair up affluent suburb kids who had access to technology with inner city underprivileged youth to “bridge the digital divide.”
How did we get from Kidz Online to KZO?
Wes Cruver: Working with Kidz Online was a great experience which allowed me to make a lot of great contacts and get to know talented young people who had enthusiasm and interest in technology. As time went on we turned Kidz Online into more of a services-based company where we were making money selling services related to training and video technology. In 2007, after 15 years of pioneering work in the video market, we decided to start a new company that would sell a product, instead of services. I think that we worked in the nonprofit world for so long that we were just excited to try something new.
How many people were on your team at that point?
Wes Cruver: It fluctuated. Kidz Online at its highest point was around 28 people. We had three studios, in Reston, Herndon and downtown Los Angeles. It turned into a rather sizable operation for a nonprofit that was started by an 11 year old.
In 2007 what happened that led you to this next stage?
Wes Cruver: We were working with a lot of video so we knew all the platforms and solutions on the market. We were also on every major Beta team, so we knew what was coming out in the future. Despite all this, we always had a problem with the current solutions and formats. They either required software installs or bulky hardware. A lot of them had trouble with firewalls and network connectivity. We started developing a platform that was based on all of our pains dealing with the video industry — whether it was web casting or training operations using video.
Recently you garnered support from Valhalla Partners, how did that unfold?
Wes Cruver: In 2007 we started working on the platform and bootstrapped our way through development. We targeted 3 different verticals — government, higher education and corporate communications. We had a goal to meet for that year: to sell into each one of our verticals and to prove we could sell those platforms. That first year we generated a quarter-million in sales, eventually landing Cisco as a customer. At that point, we realized we had a product people wanted and decided to raise capital to throw fuel on the fire.
What is the corporate snapshot of KZO?
Wes Cruver: We have seven core employees here and three outsourced developers. We also have a growing and extremely experienced advisory board.
Where do see KZO in 3 years?
Wes Cruver: We are positioning ourselves as a SaaS (Software as a Service) offering. Our existing sales were all enterprise licenses so by moving into a SaaS offering our customers do not have to install any hardware or software, which decreases their infrastructure costs, and allows us to target the small and medium sized businesses in addition to large companies. We would like to grow our sales force and our internal operations; we are forecasting that in 3 years we will have 50-60 people at the company.
Any trends that you are charting you can tell us about?
Wes Cruver: SaaS is a huge trend. 80 percent of small and medium sized businesses will try SaaS in 2008 because it just makes sense for them. It has an incredibly low barrier to entry, no giant up-front costs or hardware purchases. Businesses are no longer required to train employees to install or maintain the product. There’s also no commitment; if you don’t like it, you simply stop paying for it.
