Rui Pedro Alves, is the man behind RUPEAL and InvoiceXpress. Nominated by Leo Xavier, Rui has his own vision on the Portuguese Startup hype and thinks that people and culture are the most important thing when building a company. We joined him at RUPEAL’s HQ to bring him aboard the Ship and share his adventurous story with the world.
Rui Pedro Alves, is the founder of RUPEAL, an IT company focussed on developing new technologies and products and also staffing and outsourcing. They currently have a team of 90 people and they made 3 million euros last year. RUPEAL developed and launched InvoiceXpress 5 years ago which is an online invoicing software operating in Portugal and they have grown up to 3000 customers during these last few years. Rui calls it the first startup coming from RUPEAL and he guarantees that we’ll see more of these products coming from RUPEAL in the future.
InvoiceXpress was a success and, in fact, many startups are using it. Do you plan to launch other products such as InvoiceXpress in a near future?
Yes, of course! We’ve launched TalentFalco last year but we haven’t yet created a lot of buzz around it because it’s a different product. Our philosophy when we have a business idea is to solve a problem that we experience ourselves. Just like InvoiceXpress. So, when we see an opportunity, we find a solution and then implement it. If we’re experiencing the problem ourselves then probably more people are facing it as well. With TalentFalco it was pretty much the same logic. We needed a tool to manage staffing and we realized we had the know-how within our team to develop this kind of product so, let’s just get this done. TalentFalco is pretty much a CRM for staffing companies. It’s really focused in companies that do outsourcing and it’s tailored for the kind of problems those companies have. It’s not for companies who wish to get more CVs. We pretty much assume that everyone has a LinkedIn profile as a CV. What we did was build a database so that we can work on the relationship the company has with these candidates, by keeping the history with the candidates in one place that is easy to access. It’s a niche product and completely different from InvoiceXpress. We are currently entering the market and it’s a different approach, we are contacting companies directly and doing demos and we’re already making money, but it’s growing slowly.
When you build your own company you really need to learn fast, otherwise you won’t make it and it was that drive that kept me going.
Our goal is to develop more of these products in the future. The outsourcing came up initially as a short term strategy in order to finance other business areas of the company and we’ve always assumed that. What we want to do now is products, so my idea for RUPEAL is to turn it into a product factory. We have a lot of know-how from InvoiceXpress and now we have to use it to do more.
Do you want to be a product factory because InvoiceXpress was a success or because that has always been your long term strategy?
That thought occurred to me in the very beginning and actually we have even tried to develop a few products before InvoiceXpress but it really turned up to be nothing. The fact that we need to use the product really helps us in order to keep it alive and moving. Otherwise it wouldn’t make sense, we wouldn’t have the same drive to keep on going and this is true for any startup. And we have others coming along as well, we thought of a B2D (Business to Developers) product for example. So, in the end we only develop products that are B2B or B2D, for a very simple reason: it’s the kind of products we know and for the markets we work with.
What moved you towards having your own business?
Well, I worked for a couple of companies but in the end I decided to create my own business. I thought that with my own company I could do better than most consultancy firms out there. I didn’t have much experience with outsourcing or consultancy however, I had the mindset from all the workshops and training sessions that I did in the past. So, I felt I had all the resources to build this from scratch. What I had was basically a different attitude in the market, I wanted to do things my own way. However, because I knew nothing about this business I had to learn it all during the first year. When you build your own company you really need to learn fast, otherwise you won’t make it. And it was that drive that kept me going.
I also had many ideas on what a strong company should be like. I had read a lot about people and culture and I wanted to test the theories that I was so fond of with my own company. Otherwise, I would never know.
You can actually tell by walking into RUPEAL’s office that company culture is taken seriously. But how can you define it? And why is it so important?
I think culture is the most important thing within a company and for quite a while now I’ve been getting inspiration on how to build the right culture from many sources. One of my inspirations was a book written by Ricardo Semler called Maverick. He is one of the inspirations for 37 signals and Holacracy and this book was particularly inspiring to me because it was the first time I understood what a company in the 21st century was supposed to be like. Other books that have also inspired me were Delivering Happiness by Tony Hsieh from Zappos and From Good to Great by James C. Collins.
If you have the right culture with the right people you’re gonna have amazing results. So, for me people and culture are the source of all value.
Another thing which also had a huge impact on my perspective regarding company culture was the training sessions I did with Keith Cunningham in the US. He was the first person to prove to me that: a business is all about people and culture. If you have the right culture with the right people you’re gonna have amazing results. So, for me people and culture are the source of all value. What you see in RUPEAL today is exactly that because I really believe in this. Just to give a few examples, at RUPEAL we do many things that reflect our culture. There’s a gratitude culture, where we show appreciation for each other. People bring cake. And we always aim for excellence. We also measure everything, because you can’t improve what you can’t measure. At RUPEAL we have a culture of transparency so, we conduct our job interviews in group if the people within our team are interested in participating in the interview. In practice everyone’s involved in the recruiting process. For example, if you’re doing an interview for the SWAT team – Special Web Apps and Tactics – the whole team might come if they want to. The logic is if you’re gonna work with them they want to get to know you. We have had interviews with 17 people in the room. And the same thing goes for team leaders: the team gets to choose the person who will be leading them. We also have full transparency regarding salaries. It’s an open discussion. When we review salaries we do it as team. I tell everyone, ‘here’s the amount we have for raises’, and they have to decide who gets it. This is actually an interesting process but it’s these kinds of things that keep us all together.
And from what I understood when someone decides to leave the company it’s due to one of three reasons: 1. They don’t feel appreciated 2. They feel they are not involved in decisions 3. They want a higher salary. But if you manage to combine the first two and turn it around, you get a motivation and productivity boost. And all this is my responsibility, to keep people motivated and making them feel they’re part of this. For instance, the decision of moving to a new office was a team decision. The whole team got together and voted for this office space in Saldanha, right here in Lisbon.
Today kids are thrown to the wolves, they do a business model canvas and think it’s enough. You let people think it’s easy.
What are the differences between starting a company in Portugal in 2007 and doing it now?
Well, I’m a bit of a critic when it comes to the startup eco-system we have nowadays. I think you’re giving some of the wrong motivations. It is as difficult as it was in 2007 to build your own business but today there’s a negative side which is there’s a lot of buzz. Getting your own office space is much easier, definitely. You now have Startup Lisboa for example and if you have a tech startup you can knock that door and get office space and that is awesome. You have co-working spaces such as Cowork Lisboa and that is quite cheap and it has a great working environment. Today you can also find better partners and bootstrap your business with very few resources.
However, today there’s also a lot of buzz around the competitions and awards and parties, really all this big hype around startups in Portugal. We see a lot of ideas but then you don’t have the same amount of actual businesses. There’s very few people thinking of how they’ll create a product that people want and finding out how to sell it. Very few know: How to get new customers, how to scale a business, how to build a team, etc. There’s very few mentoring around these topics. Today kids are thrown to the wolves, they do a business model canvas and think it’s enough. So in this perspective it’s actually harder, because you let people think it’s easy.
Another thing you didn’t have in 2007 was this anxiety to raise capital. I never got an investment, I had the opposite path, I was still a consultant and opened my business while still working until I reached a point that I could already pay for my own salary and then quit my job as a consultant. RUPEAL was fully bootstrapped, it all started with my own personal finances. Today I see a lot of people running for investment and so anxious to go to Silicon Valley and when you ask them why they need so much capital most of them don’t even know. Sometimes you don’t even need it! You can launch a product without the capital in some cases. What you need is customers and it’s quite ironic because when you have customers it’s much easier to get investment.
You were also a mentor for many startups at Startup Lisboa and Beta-i. How was that experience?
Honestly, I think this kind of mentoring is short. I’ve done it at Beta-i and Startup Lisboa but then I stopped because it adds very little value, it was way too short. For instance, I have my own mentors but it’s an ongoing process, it’s not just a couple of sessions and I feel that you don’t have that kind of mentorship nowadays. For me I choose my mentors according to their results, for their track records. If they’ve achieved what I want to achieve then I’ll talk to them. Currently, I do mentoring to a few startups out there but as an ongoing process and they are the ones contacting me first.
I feel like we’re all looking for the 100 million euro startup when we should be looking for the 100 startups who will make 1 million euros first.
What’s missing in the Portuguese Startup ecosystem?
I think that what we’re doing is good, don’t get me wrong. We’re putting Portugal on the map. You now have many startups coming up, many initiatives such as Lisbon Challenge and much more. So, at building the interest around entrepreneurship we’re doing a really good job. I’m just a bit skeptical about the long term results that this system will bring. I feel like we’re all looking for the 100 million euro startup when we should be looking for the 100 startups who will make 1 million euros first. And this changes the focus completely. What we’re doing today is a waste of resources.
We should also bring the Y Combinator mentality to Portugal, focused on growth and not just ideas. We shouldn’t be here discussing who has the best idea, for me 1% is the idea and the other 99% is implementation. Give me an idea, any idea, there’s probably 100 people who tried it before and failed while there was someone else who picked it up and succeeded. It’s never what you do, it’s how you do it. Unfortunately, what you see nowadays is people focused in ideas, to win the competitions and awards. But when you actually see what happened to these ideas, very few turned into successful businesses. It would be much more interesting to have a competition based on growth, to see which startup grew faster for example. I would love to talk to Sofia Pessanha from Unbabel when she comes back for her to tell me about Y Combinator and that whole mentality. I’m sure they are more motivated towards growth and they are much more focussed in particular metrics than in the idea itself and the pitch. And this whole Y Combinator model definitely works. Startups grow so much during that period and they develop their product in a way that when they leave the program they’re ready for other type of investments.
You never had any funding but have you ever felt the need to ask for it?
Actually, InvoiceXpress is going through a phase that it might need funding because we want to expand to Spain. But, the truth is, we keep on closing deals so, the other day we noticed that we might get the money we need in order to expand by getting these new customers.
I want to build an empire, I want to play monopoly. My idea is to build a sustainable business that works in the long run.
But if you wanted to expand throughout Europe it wouldn’t be possible without investment. How would you define your strategy in that case?
Well, but I don’t have that ambition, that’s not my philosophy. I believe in having a long term business that grows organically and that in the future might even buy other companies. I don’t really go with the idea of building a short term business and having an exit. I want to build an empire, I want to play monopoly. My idea is to build a sustainable business that works in the long run. I’m currently more under the perspective of investing than of getting investment.
Do you think that today you have more companies than 8 years ago when you started?
I would argue that the numbers are very similar but on second thought there might be more companies today. The reason behind it is the economic crisis. People felt the need to create their own jobs and make a leaving out of their own businesses. They’re more receptive to starting their own companies than before. But what we need to think is, we need to build products and services that add value to others. It has to be what people want. If you build something people want they will come to you.
In which Portuguese startups would you invest?
I wouldn’t necessarily invest in these startups but I’m pretty sure they’ll have much success. The first one is TalkDesk, they’re B2B so I know their market well, I’m sure they’ll have a growth boom and an exit very soon. The second is Seedrs, because I think it has a lot of potential and they are doing things right. And the third one is LinkedCare, not many people know them but I really think they have a good product and I believe in their team.
Who would you invite aboard the ship next for a pier-to-pier?
Like where this is heading? Did Rui Alves give us the right coordinates for the next interviews? Then, stay tuned for the following pier-to-pier with the fellow adventurers.