I've been following cloud-based point-of-sale (POS) vendor Vend since its inception half a dozen years ago. Actually, I've been following the company since before its inception. Prior to starting Vend, founder Vaughan Rowsell rode his bicycle from one end of New Zealand to the other. En route he stayed a night at my place and we discussed the opportunity for putting POS in the cloud.
Rather than just talking about it, Rowsell went on to found a company, get backing from some big names early on, and raise venture capital from, among others, Point Nine Capital, the Berlin-based VC fund that has backed other SaaS success stories including Zendesk, FreeAgent and ChartMogul.
Vend grew rapidly and was seemingly everywhere -- offices in North America and Europe, big offices and all the trappings of a seeming unicorn in the making. But where things grow rapidly, they can also deflate similarly quickly, and last year was something of an annus horribilis for Vend. A drying up of venture funds and perhaps execution which lagged behind the hype meant some hard calls had to be made. Vend slashed its workforce and closed some of its international operations.
It was a hard period -- the company handled things very well but there's no avoiding the fact that anytime widespread staff cuts are made, things take on a somber tone. Often there is a flow-on effect from these changes which finds its way into the upper echelons of the company.
And so it is with Vend, where Rowsell announced today that he is going to stand down from the CEO position to focus on the product. Into the vacancy, Rowsell is embarking on a process to appoint a new CEO to run the business. In the meantime Vend is appointing Alex Fala, who is the current head of strategy and finance, to be acting CEO.
Rowsell told me via email that this is part of him being able to focus:
"... after shedding all my hats over the years I was left with two. CEO and product visionary. And I found that the CEO hat was all-consuming and we were not focusing on the big vision around product as much as we should. So I figured there would be someone out there who has a truckload of experience going through the next phase of Vend, growing from $20 million to $100 million of revenue."
I put it to Rowsell that this move is potentially going to be seen as a sign that his investors and board don't have faith in his ability to execute upon Vend's opportunity. He denied any relationship with last year's angst and pointed out that he will still have a seat on the board. He also, true to his character, was pragmatic and open about this move:
"I would be kidding myself if I didn't think dealing with high growth and restructuring the business to fix speed wobbles didn't ultimately play a part in my thinking about what I am best to focus on and what I am passionate about. Since then I've been heads down making sure the business was in good order so we had a solid base to work from. Now it is perfect timing to bring someone new in."
Rowsell was quick to point out that the change came from himself and that the board and investors haven't been pushing for the change to occur. He simply wants to focus on the product side of the company and find someone who can execute the bigger business opportunity. In terms of the timing of the announcement, and the fact that it comes before the CEO appointment process begins, Rowsell was similarly pragmatic:
"I want to go far and wide with the search and the best way to do that is to talk about it. It's not me to keep secrets from the team, and I didn't want to create any uncertainty about what I am doing. I am steering product, working on partnerships, but most importantly right now I am finding the best CEO to drive the business to be as big as it can be. Also doing it like this the new CEO knows what she or he is taking on. It can be a bit weird to come into a founder-led business. This way it really is clear how we will work together."
Finally, Rowsell allayed any concerns that this would mean a shift of location for the business, saying that the incoming CEO will be based in Auckland, New Zealand, where Vend is headquartered.
Vend seems to be recovering from last year's speed wobbles. It has had some high-profile partnerships with SaaS accounting vendor Xero and payments provider PayPal, and future partnership announcements are apparently in the cards. Change is hard, but it is also a constant in this sort of high-growth company. It will be interesting to see the decisions that the incoming CEO makes.
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