Software provider in Focus: essensys
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We sat down with Mark Furness, founder and CEO of coworking software provider essensys, about growing with a nascent industry and the key to finding success as a CEO…
Combining his experience from a raft of different working environments, Mark Furness spotted the niche coworking industry’s potential and crafted a flexible, scalable company to provide essential services.
With essensys now the leading global provider of software for the sector, we spoke with Mark to understand his journey to success and find out his recommendations for others looking to follow suit…
Tell us about your career path.
My career has been quite varied! It started very differently to what might be typical for my job role now. As all good Liverpool kids do, I joined a band and I ended up on the road for a couple of years as a musician. I was the drummer, which was a pretty amazing experience. In the years that followed, I did everything from working in a job centre to doing door-to-door sales. After that came account management roles, sales roles, and then general management roles. I then led the successful turnaround of a failing UK telecoms business for its Monaco based owners.
A slightly unique and probably different path than many in this field! I think my role at essensys is the culmination of all my experiences from the last 13 years, and I draw upon all of it for the job I do now.
What is your role in essensys, and how do you define the business?
essensys is the world's leading provider of software and cloud services to the flexible workspace industry, or as it’s more commonly referred to nowadays, the coworking industry.
Our software is designed to help coworking operators run more efficient, more successful businesses, and to connect with their clients more effectively. My role has been to lead the business as the CEO, ever since I founded the company back in 2006. My job has three key elements. One - to challenge and to question; two - to try in some way, shape or some form, to predict the future; and three - to set the company pace and standards. I’m essentially the conductor of the business.
Why did you launch essensys?
The genesis of essensys was a thought about how we could help businesses manage their IT infrastructure better. How could we help businesses deliver self-service IT, instead of hiring big IT teams?
As we came closer to launching the company, we started to focus on the nascent coworking industry, which encompasses flexible offices and serviced offices. It was clear to us that our idea of using automation and self-service technologies could really help an industry like this. It’s an industry which has lots of users coming and going, varied requirements from customers, and non-tech people in charge of managing locations. How could we help these operators to offer IT services without needing to build massive IT teams? How could we use software to allow them to deliver and manage all the IT services that they provided to their customers?
Industry: Coworking software
Ownership: Privately Held
Sub-sector: Software, Hardware & Developers
What is essensys’ USP?
As we are embedded within this sector, we've grown within and with the industry as it rapidly evolved - we’ve been at the heart of it from the early days. We’re 100% focused on the sector and so we’re now deeply integrated in the industry. It means we are quite unique in that we’ve witnessed the shift in the industry from a fairly niche and supply led sector to high-growth coworking industry that’s now very clearly being led by demand side forces.
We have a comprehensive understanding of our customers which is the result of over a decade focussed solely on this sector. This has translated into the most comprehensive software solution available to meet all of the requirements operators need to run flexible workspace businesses.
And from a technological point of view?
Our “orchestration engine” is definitely what sets us apart from competitors. It’s an amazing part of our platform, developed to control and manage all services that our customers need to provide. It's completely agnostic to what it’s controlling; it can control anything from IT services, networks, and Wi-Fi to apps. It was designed to keep extending the number of services we provide to customers.
It’s easiest to think about it like a conductor. The conductor stands in front of many different instruments, and it really doesn't matter what the instrument is - the conductor can control and manage what happens and when. It offers real time orchestration capability, giving everything an immediacy that’s hard to compete with.
"In an industry like ours, everything is about immediacy, frictionless delivery and reducing time to value."
How has the company evolved since it was founded in 2006?
If I look back on the business from where we are today, there were three clear phases of growth. There was the pre-product phase, where we were taking the idea from the whiteboard and our understanding of the sector and starting to develop our platform and software. At the same time, we were out talking to prospects and customers about what our platform could look like in the future.
We were focused solely on delivering something around the requirements and needs of our customers, or our future customers. In that pre-product phase, which in planning we probably thought would take us a year, ended up taking us four years.
We were also selling products other than our software, i.e. some hardware and some professional services to generate cashflow to fund our R&D. We really bootstrapped our idea. That was the true pre-product phase, getting it ready for general release, which lasted until 2010. I’d call that phase one.
Phase two was post-product launch. From 2010 to just before 2014, we saw accelerated linear growth. The product was really catching, customers were loving it, but we were operationally under-resourced. Despite our great product, we lacked horsepower in terms of working capital, our back-end systems, our processes and our people. We really found growth to be a challenge – we were growing rapidly, but that was hurting the business in this stage. That was a big learning moment.
We brought some experienced senior people in at this point to help us get back on track, and so towards the end of 2013, everything levelled out and we had a growing, profitable business that was performing really well operationally too.
However, the market was rapidly changing, and what our customers were looking for was more capability from our software to run their entire businesses, not just the IT side. There was also demand on the business to take us international. We were seeing many customer enquiries from the U.S. in what was a fast-growing coworking market.
The third phase of growth was post-2015. It wasn’t a linear phase – it was more of an exponential growth curve. As we extended the capabilities of the platform to become a much more comprehensive solution and grew into the US with an office in New York, we really had to work every bit of our available resources to ensure we were successful. We really were fighting on multiple fronts.
I often used to look at other businesses encountering so-called “growing pains”, and I believed that because we’d ‘planned’ for growth, we wouldn’t experience the same issues. The truth is that growing pains are stresses on the business, much like stress on bones.
"What I learned about those growing pains is that they are actually a period that can present real opportunities to strengthen the core of your business."
Aside from teething problems with growth, what other challenges did you encounter and overcome?
In terms of the challenges, we initially had limited access to capital and we were bootstrapped in the truest sense of the word. Whilst it was certainly a challenge because we had to stretch every pound, it really helped as well because it ensured we stayed lean and hungry.
Probably our biggest challenge was our ability to attract talent. You’re fighting to attract talent before you’ve got a viable product and business in place – you have nothing but a slide deck to show where you're going. It was a competitive market and you have to convince top talent to join with only the promise that options and equity will be worth a lot in future.
You also have to make sure you don't just recruit for today. I think a mistake we made in the early stages was that we recruited for the requirements of the business in a short window of time, instead of thinking ahead to a two, three, or four-year horizon.
You need to find talent with the horsepower that will really come into its own 12, 24, or 36 months down the line. At the same time, they must be able to do the work in the present, and it might not be work they aspire to do. You have to really pitch long-term plans and be clear that there's a requirement to do a lot of things that they wouldn't normally be attracted to.
How does your business guard against disruption?
Many businesses think about the defensive play to guard against disruption; I don't think that's the right answer for us. We have to embrace the idea of disruption in our sector, and at the same time be the ones who disrupt our own business. We spend a lot of time really challenging our thinking, debating the “what if” scenarios. As a company we try and embrace the idea of disruption by staying paranoid. We can’t be complacent!
How does the future of the company look?
We are so excited about the opportunity in front of the business; the coworking industry is still at the very start of its journey. Flexibility in real estate will become the new normal, so spaces that deliver that and the services that support agility will soon follow. If you look at the U.S. market, for example, less than 1% of all office stock in the U.S. is delivered as a flexible space product now, but that is expected to grow to 30% within the next decade.
We expect the penetration of flexible workspace will increase rapidly in real estate, the world's biggest asset class, which will provide huge opportunities for this business in future. We have everything to play for!
Are there any lessons you’d like to have known starting out, or any advice you’d like to give?
It’s critical to be yourself. When becoming a CEO, it’s tempting to try and be the version of the leader you see in books, documentaries and biographies, but that takes energy. It’s much more efficient to be yourself.
The importance of thinking time is often neglected, and I think it’s incredibly valuable for founders and CEOs. The time sat thinking, pondering, questioning, developing and whiteboarding is critical, but for some that can feel like you’re not really working. You’re not building something, so it feels unproductive. But for a CEO or founder, scenario planning, and thinking is as crucial as the “doing” part is. From an optics point of view, it perhaps doesn’t look like a good use of time, but I think it’s really important.
I think probably one of the most important things for anyone starting out as a founder is to find an outlet. Things will alter rapidly between amazing and terrible, even within the same day, and you have to have a way to decompress. Find a support group, mentors, family or friends, a sport – anything, because the stresses and strains of the job can easily calcify over time.