April Spotlight: Mark Geene, CEO and Cofounder at Cloud Elements

We’re proud to introduce you to Mark Geene, the CEO and co-founder of Mercato’s newest portfolio company: Cloud Elements. Mark started his career with tenures at AT&T, IBM, Oracle, and TenFold – eventually leaving those large organization to co-found Channelinsight, where he was the CEO. His experiences at Channelinsight led him, and co-founders Vineet Joshi and Atul Barve to launch Cloud Elements in 2012.

Following are excerpts and summaries from an interview conducted with Mark Geene at the Cloud Elements headquarters, in Denver Colorado, in April 2019.

Mercato: Tell me a little bit about Cloud Elements. Why did you decide to start the company? What problems were you solving?

MG: Years ago, I built a company called Channelinsight with Vineet Joshi, one of my co-founders and CTO of Cloud Elements. At Channelinsight, our work required us to collect POS data from technology retailers worldwide. To streamline that process, we began building connections to their accounting and CRM systems. We found that we were often spending more time developing those solutions than on our own application, which was frustrating. To solve this we tried several of the leading integration platforms on the market and realized that none were built to solve the problems a software company faced. So Vineet and I decided that after Channelinsights we would build the first real integration platform for SaaS and technology companies.

As a SaaS company, we brought a unique perspective built on a thesis that that more of the integration responsibility would eventually move away from the buyer of applications, who would often buy applications that didn’t work together and then be forced build the integration themselves, to the provider of applications. The provider, as we predicted, needed their applications to work with other applications more easily in order to attract and maintain customers. We were solving the primary problem that we faced as a software company and realized that we could solve that same problem for other technology companies.

Mercato: How did your business model evolve? And how was your product received by the target market? As you execute your 2019 plans, how does the current growth trajectory at Cloud Elements compare to your earlier milestones?

MG: We started by solving easy problems first. In our early years, we built out categories of application services. We started with the ability to connect to cloud storage services, like box.com and Microsoft Sharepoint, which was relatively easy compared to connecting with CRMs and ERPs, especially with the complexity of structures and data models that live in those systems. Then, we expanded our integration abilities by “iterating to success,” which is one of our core values at Cloud Elements. What this means is that we solved increasingly complex integration problems by taking a repetitive approach that allowed us to build on skills we learned and gathered via each new challenge.

We moved from data storage to CRM and marketing applications, which are far more complex. Then, we kept challenging ourselves. We had to start this way and work to demonstrate a unique competence in more complex systems and application ecosystems in order to gain the trust of the integration market. This strategic approach allowed us to establish a competitive advantage, connecting applications like Salesforce and Marketo. Now we are one of the leaders in connecting complex systems, including finance and ERP systems.

As 2019 unfolds, one of the things that I am most excited about with regard to our business model is that every time we enter a new application category we also enjoy a new market that opens up for us. This year, we opened up the Human Capital and Payroll integration categories. So, even if we were to experience a slowing down in a certain area, we are confident we can maintain our high growth by opening additional categories of integration capabilities, and we will continue to do so.

There are so many applications and application categories for us to tackle. For example, if you look at the Marketing Technology industry, there are so many logos on the market map, something like 8,000 companies in that space. A few years ago, there were only a few hundred companies on that map. This fragmentation of the technology space has provided a huge tailwind for us. Somebody needs to bring that fragmented ecosystem of applications together – and that’s what we do. There are over 20,000 applications in the human capital, payroll, and employee application tracking system spaces; that opens up huge opportunities for us to expand. As long as developers are being innovative and creating new applications and new APIs, there will be the corresponding need to integrate those applications. We see a bright future for integration. We are also very excited about our new partnerships with SAP and Axway.

Mercato: Those partnerships do sound fortuitous: can you tell us a little bit more how the partnerships are structured? Also, what are SAP and Axway doing with your product from a white-label perspective?

MG: Since 2015 when we launched our first product, we’ve seen extraordinary growth. We’ve seen the possibility of selling to software and financial services companies directly as just one way we’ve been able to transform our growth rate, and we believe that is sustainable for a long time. Then, last year, we signed a global reseller agreement with SAP. SAP is now selling a white-label version of our product called “SAP Open Connectors” to their customers worldwide. We closed a second similar agreement with Axway, which is an Electronic Data Interchange or EDI with headquarters in Paris and Phoenix. The acceleration of our growth rate has been astounding; we will continue partnering with white-label resellers as it allows us to layer our sales with exponential growth for the foreseeable future. These partnerships give us an efficient go-to-market channel in the enterprise. What’s really cool about this is the impressive size of some of the customers that are now using our core product inside of SAP and Axway.

Mercato : What is Cloud Elements like as a Company?

MG: Well, Cloud Elements is a collection of amazing people in an amazing place. Denver, Colorado is home to an incredibly talented, educated and experienced workforce. We’ve built a recruiting process that allows us to consistently hire world-class experienced talent and ambitious young professionals. We invest time and training to help develop their careers, so they can grow with us no matter where they begin. Everything we do as we grow is held together with our core values as a company. Our values are grounded in having a devotion to the customer experience; iterating to success; and hiring passionate contributors.

This is what I like the most, that we hire people that are truly passionate about their work. It never ceases to amaze me that through all of the changes that occur in an organization, some of the largest impact can come from anyone on our team. Because we believe in that model and can’t wait to see what happens next, we don’t have offices; I have an open desk on the floor with the team. No one person has all the right answers. We work well because we find the right answers as a team and we execute them together. That’s what I love about what we have built.

Mercato: As you started seeking financing options, what were your early impressions of your interactions with Mercato? Why did you choose to take funding from Mercato when you clearly had so many options?

MG: Mercato’s unique communication style got my attention early on. First I noticed their approachable and easy way of getting to know our executive team. As I mentioned, we all sit together at Cloud Elements; we don’t have offices and we don’t have big egos. The team at Mercato was approachable from day one. Mercato is full of very smart people with great insights, but they don’t have big egos and never try to be the smartest people in the room. That attitude fits with our culture. We felt natural around them because they were generous and genuinely interested in our success. We were also impressed with the companies in their portfolio, current companies like DOMO, as well as some of the past success that Mercato has seen through IPOs and acquisitions; that was certainly an aspect.

Another piece was the Mercato performance team. We were looking for a partner that was more than just a capital provider. As we started to meet Justin, and Dennis, and John, in addition to Josh and Joe who both got very engaged early on, we continued to be impressed with everyone we met. Then as we met with the partnership, I really appreciated the perspective on the industry from Greg and the rest of the team. Everyone who came on- site during the due-diligence phase was really enjoyable to work with, and I knew that if we enjoyed working with them pre-investment, we would want to work more closely with them after they invested. The team was just very smart with amazing insights, but they were also fun people that we knew we could collaborate with. Rather than telling us what to do, they were willing to sit side-by-side with us to help us find the answers.

An investment relationship typically lasts for a decade. With Mercato, it was easy to imagine our relationship evolving over the decade in ways that would consistently benefit our company. We are excited to embark on this shared journey with our new partner.

About Cloud Elements

Cloud Elements brings harmony to the world of APIs, allowing software providers to innovate faster and plug into digital ecosystems. The company’s one-to-many virtualized API integration platform enables developers to unify thousands of APIs, build common data models for core business functions, and reduce the pain, cost, and complexity of integration. Founded in 2012, Cloud Elements is headquartered in Denver, Colorado, and serves customers worldwide. More information can be found at www.cloud-elements.com.