SaaS Investing and Business Success: A Year in Review with New Leadership [2023]

In the summer of 2022, SureSwift Capital welcomed James DeGreef as its new CEO. In this exclusive conversation, James shares insights into his transformative leadership journey at SureSwift, delves into his perspectives on SaaS leadership, and provides a glimpse into the future direction of SureSwift. Join us for an insightful conversation covering DeGreef's leadership philosophy, the evolving landscape of SaaS, and the forward trajectory of SureSwift Capital.

Developing SaaS Leadership

James, you’ve been at SureSwift for over a year now. Can you share with us how you came to SureSwift, and how the first year went?

I’ll cover my “why” I came to SureSwift first, because there are a couple big reasons. Before joining SureSwift, I was “semi-retired” – I hadn’t had a day job in around seven years, though I was fairly involved in quite a number of different tech businesses and some funds - investing and advising. That type of advisory role is informative and fun because you don’t have direct responsibility and authority. It's not fun in the sense that sometimes, your advice gets left there, and people make mistakes and do things differently than you would have. Not that ignoring me was always a mistake – I don’t know everything, and sometimes it was good that those business leaders stuck to their guns and didn’t do what I shared. 

Over the seven years of advising, I gained a lot of experience with tech and SaaS businesses. I was starting to get to the point where I wanted to use my experience to focus on something new, that leveraged all the skills and knowledge I had been building, including with my first company I co-founded, GenoLogics Life Sciences Software. 

At GenoLogics, I learned about running a technology business. Most importantly, I was working with a number of awesome people who had a lot of experience in different systems, and all had unique approaches to doing some cool things. I learned about systems and approaches from them, but I also learned how important it is to surround yourself with smart, experienced people – especially people that have a different background and perspective from you. 

Combined with my advisory work with tech startup businesses, I was exposed to a whole new way of running a business. So when the opportunity to join SureSwift came along, it seemed like a unique mix of both – a larger organization like Genologics, as well as all these different startups and SaaS companies. The role seemed like a glove that fit my hand nicely. 

Secondly, it seemed like a unique challenge in that there were some significant changes that needed to be made, and I would be helping to turn the ship around. I had a few concerns around entering the situation somewhat blind, but I wanted to do right and do well by many people, knowing there were tough decisions to be made. Fortunately, there were already some amazing people at SureSwift, as well as awesome people that we were able to bring on.

Looking back over the last fifteen, sixteen months, there are definitely things that I know could have gone better, but overall, we’ve made some good progress and change.

Recent Success at SureSwift Capital

What do you think are some of the bigger wins?

One is on the people-side. I believe that if you have the right people, the right team in place, that’s 80% of the challenge. My job as a leader is making sure that we have the right people on the bus, and I think that’s even more important than having people in the right seat. I think for the right people, sometimes many seats are right for them, and in a really dynamic company like SureSwift, having those people who can successfully fill many different roles and who are flexible and open to that is key. So one big win is a major focus on people. 

A second big focus was on right-sized process and communication. Early on, it really felt like SureSwift was trying to be too big of a company for the actual size. So streamlining, minimizing busy work, and removing barriers to communication and collaboration became a priority. 

I think now, we’re about 30% of the way there in terms of where we want to be with how our portfolio businesses are organized and how we all work together within SureSwift at large. Some things are working really well, some things are works in progress, and some things we haven’t started yet but will. But overall, I think how we collaborate structurally, work together and share information is a big win, especially with the launch of the Exceptional Operator Framework. I was just looking at our portfolio business leaders Slack channel this morning, and I’m really happy with the amount of collaboration happening there, and I think the team is finding it really valuable too. 

What about more external wins? I know we’ve spent a lot of time working on SureSwift’s relationship with investors. 

Yes, when we were reorganizing SureSwift, there was a shift where we have one high performing corporate team that really recognizes that our Fund Investors are our customers. Each of our portfolio businesses has their own customer set that they prioritize and understand well, but that hadn’t been done at the corporate level (the portion of the team working on SureSwift as a management company, not on any particular business). In 2023, we prioritized more clear, transparent, and two way communication and reporting with our investors. We also had a lot of conversations with the investors, and they’re a really smart, really interesting group.

Recently, we've had many opportunities to engage with our investors and gather feedback. The overall sentiment is positive: firstly, they are really pleased with improvements in transparency and communication levels; secondly, they are pleased with the positive investment results they're experiencing. 

One other thing that I would definitely consider a win, even if it’s not quite complete yet, is work we’ve been going around clarifying our mission, vision, and values. I’m going to start rambling here a bit, but I think it’s a good story or analogy, so bear with me.

Back in the day, and I was pretty dumb to do this, but I did a house renovation. It was this old house in Oak Bay (Victoria BC), and it was a character home. We may have bitten off more than we could chew, we wanted to make it bigger, redo all the infrastructure, plumbing, electrical, everything. We even redid the foundation – we had to lift the entire house a quarter of an inch, dig down, and replace the foundation. We dug even further down, did a full basement, put in flooring, heat, everything mechanical. And then we set the house back down. 

Inside, we opened some things up, put on new paint, new finishes, made everything really polished and amazing to live in. It was a lot of work, and we were definitely a little crazy to take it on.

So inside and underneath, it was a completely new home. But if you were looking from the outside, you’d probably just think we cleaned things up a little bit, put on a new coat of paint.

In some ways, that feels like SureSwift. What we’re doing right now is putting in a new foundation, and that’s the mission and vision. We’re opening up some rooms to allow for collaboration and visibility, and we’re making it a better place with better outcomes for investors, founders who sell to us, and our team. So we don’t have a new website just yet, we don’t have the updated marketing or brand – but on the inside, in many ways, we’re a new SureSwift. And I’m excited for those external pieces to come, but in my opinion, there’s no reason to rush that piece if you don’t have the foundation to back it up.

Continuing SaaS Growth and SureSwift’s Fund C

It sounds like this first year has been about getting in and understanding what needed to be done, and then bringing in new leaders and removing barriers. Now that things are in place, what excites you about what's to come for SureSwift?

There are a lot of things to be excited about. One is that we’ve brought in some new leaders with strong experience for our portfolio businesses, recently Dave Aidekman, Kit Dean, and Matt Wood. Bringing in really seasoned people has been a huge goal, because they not only help the product they’re working on, but allow us to all collaborate and work together and level each other up. So I’m really looking forward to continuing to see that pay off, especially in our learning Skill Guilds and then with the playbooks we’re continuing to develop for our Exceptional Operator Framework (EOF). 

Speaking of the EOF, that’s another thing I’m really excited about for the future of SureSwift. We’ve done a great job laying the foundation, and kicking things off with guilds, and how we work together with our portfolio businesses, and I’m eager to continue to push those initiatives forward and really perfect them in a way that you only can once they’re actually up and running.

The last big focus for 2024 is the launch of SureSwift Fund C. There have been so many good learnings from Fund A and B that we can take with us into a new fund, in terms of everything from the types of businesses we want to buy, to how we communicate with our investors, that I know Fund C will have some great outcomes.

With all these learnings, what’s going to be the same and what will be changing with Fund C?

Well, we’re still early in the process, but there are a couple key aspects. One is to be a lot more discerning and specific about the types of businesses that we want to buy. We won’t be looking at businesses that leverage each other or have synergies with existing businesses, we really want each business to stand on its own. 

In Fund B, we bought a few smaller businesses that seemed like they would support or have synergy with other businesses in the portfolio. It was a strategy that made a lot of sense on the surface level, but once we had ownership of the business and started digging deeper, it became clear that things weren’t going to work how we had hoped. 

I think a strategy like that can pay off, but we’re really not looking to take risks of that kind. We want every business we add to a future Fund C portfolio to be a complete business in of itself that has both real growth potential and strong stability. With that being said, we do want businesses that have similarities in terms of business processes, function, go-to-market, and those pieces that will allow our team to collaborate and share knowledge.

Another focus is the founders and the teams. Recognizing they've had good success, they’ve got the business to where it’s at, and they know what they’re doing. We want to do everything we can to collaborate with them and encourage them to stay on where possible. We also want to stay connected with the original founders, and really leverage their expertise over the acquisition transition period, whether that’s six months or a year. 

I think some of the Fund B business founders were actually surprised we didn’t leverage them more, so I’m very hopeful that staying connected and building really strong relationships with them is something that’s doable for future acquisitions. 

On the flipside though, we want to be very thorough in our due diligence with the question of whether we could successfully run this business if everyone from the original team were to leave. Our best case scenario is obviously bringing the team fully onboard, and I think especially with our new semi-autonomous model we can make that a really attractive option for people. But there’s always that chance, whether it’s because people have other projects or just really love a start-up environment, that you’re going to lose a percentage of the team. And we can’t have an acquisition that’s going to be totally dependent on that team with no back-up plan, so it will be really important to not only be looking at the business we’re thinking of acquiring during due diligence, but also doing a bit of due diligence on ourselves and seeing if we have the capacity and expertise to successfully run the business on our own if we had to.

Conclusion

As you can see, James DeGreef's first year at SureSwift Capital has been about getting the right people on board, streamlining processes, and keeping it real with Investors. The team's major wins include focusing on solid folks and fine-tuning how they work together. 

Looking ahead, there's excitement about the Exceptional Operator Framework and the upcoming Fund C, where they've learned from past experiences to be more selective about the businesses they bring in. It's like SureSwift is renovating from the inside out, fixing the foundation first before worrying about a fancy new coat of paint. So, with a fresh perspective and some lessons in the bag, SureSwift's ready to roll into the future of SaaS.