The NEN Interview - Jonas Lund, CEO Wizkids
Danish EdTech company Wizkids hit the headlines at the beginning of July when it announced that it had been acquired by the Texthelp Group. The press release acknowledged that Wizkids is a “market leader in Denmark and Sweden” and that the deal would enable them to “reach many more students and make a greater impact with our products across multiple geographies.”
So it was great to talk with Wizkids’ CEO and Founder Jonas Lund last week for this latest Nordic EdTech News interview. As expected, he was full of fascinating insights on the acquisition itself, on product and team development, how to grow and scale an EdTech company and why the Danes are the merchants of northern Europe!
As previously, the transcript of our conversation (edited to bring you all of the very best bits) follows below.
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Many thanks, Jonathan
Jonathan Viner (JV): Good morning Jonas and thanks for talking with me today! Let’s start at the beginning - can you tell me what Wizkids is and does?
Jonas Lund (JL): Wizkids focuses on literacy and digital education. We help ensure that everyone can make the most of their full potential in school, in work or in their private lives.
I think what makes our suite of products stand out is their ease of use. They’re all truly cloud-based solutions, so every user is able to access our products across all different platforms. That’s a really unique proposition across our key markets.
JV: How did your business grow and develop its international reach and product range?
JL: We were established in 2005, but the first real product we created was EduLife in 2010. We saw that Google had developed the GSuite platform for education and created EduLife to connect it with other school systems for schools to create user groups, distribution lists etc. We started selling it on a subscription basis to Danish schools and it really quickly became popular.
In 2012, we then established a Swedish office to start selling EduLife in Sweden before expanding to create a cloud-based tool, AppWriter, to help people struggling with dyslexia. All the other systems at that time were desktop applications, so this was a major shift for customers. Things started moving after we won our first major contract with Odense municipality in 2013.
Our UK office launched in 2015 and we quickly built a strong customer base in schools there. This really expanded with TxtAnalyser - it’s a grammar tool for students and is really a little brother product for AppWriter.
We opened our office in Norway in 2019 and also won a national tender "IT-rygsækken" in Denmark to help everyone struggling with reading, writing or dyslexia. Finally in 2020, we launched MathSolver to provide subject support through a powerful CAS calculator as part of Google Docs.
The one constant throughout this has been our desire to support those learners who are struggling and who need help. We recognise their value and want to help them to understand and be understood
JV: And how did you end up choosing this target market?
JL: There are a lot of things that I wish I could take credit for, but it just felt like the right thing to do and the right thing to focus on. So there’s a little bit of luck involved, but we have also been blessed with having some really bright people working with us to make it happen.
I'm not a specialist in all areas of the business, so I'm very thankful for their work. Otherwise, we wouldn't have had the success we have had.
JV: Part of that success is down to the decisions you’ve made as CEO. So how do you decide to launch a new product or to open up in a new market?
JL: I'm half American and have spent a lot of summer vacations at my grandmother's home in the U.S. In fact, she used to call me her little Wizkid, which is where our name came from!
I’ve always felt that it would be really fun to cross the Danish borders and to go out into the world. This has certainly given me a more international outlook on our business. We also have staff members from across the world, so it’s always felt natural to expand internationally. Finally Denmark’s a very small country, so we have had to look at new markets to build a really profitable company.
JV: Can you give me an idea of the business’ scale? How many students are currently using Wizkids across your key markets?
JL: In total, we now have over 1 million users but those numbers are growing rapidly at the moment. Around half of our users are in Denmark. Sweden is the second largest market and then the UK, which has grown significantly during Covid. Norway is our fourth largest market, where we’ve won some big municipality deals including Trondheim.
In Denmark, our users are spread across all of our products, whereas in the UK, our learners mostly use EduLife. That’s also popular in Norway and Sweden along with our AppWriter tool.
JV: Your propositions are also sold to personal and business customers. How much of your total sales do they account for?
JL: More than 90% of our business currently comes from school customers, so it’s quite a small share that comes from everything else. But it is a fast-growing sector at the moment through Job Centres, where our products help both their staff and the people they work with. This is obviously an increasingly important area for Texthelp as well and will be an important part of our partnership.
JV: What structure do you use to manage and run the individual markets?
JL: We have a country manager in each territory to take care of the daily business and to run the local sales team. We have chosen to use a direct sales model in all territories - that’s maybe an old-fashioned way to do it, but dealing directly with schools works well for us.
JV: How does that approach work in the Nordics, where so much of the sales process is focused on the municipality buyer?
JL: Yes, you’re right. In the Nordics it is mostly a municipality sale, although schools do have influence on their decisions. There are also some municipalities in Denmark and Sweden where schools make the decisions.
However in the UK, apart from the multi-academy trusts, you do have to go from school to school. It’s more of a door-to-door battle!
JV: What challenges does that present for your business and teams?
JL: There are pros and cons on both sides. The municipality deals come through tenders, which offer larger sale sizes but which typically take more time to close the deal. For individual schools, the sales cycle can be much shorter but the deal sizes are much smaller. We need to make sure that we can do both!
JV: What other differences or similarities do you see between the Nordic and UK markets?
JL: We always seem to highlight the differences between markets, but in reality most things are pretty similar. Teachers and schools in different countries may be organised distinctly but they’re really not that dissimilar.
There are differences in how schools work with children who have special educational needs. The UK market approaches this through the Disabled Students' Allowance (DSA) and although there are similar programmes in the Nordics, the funding criteria etc vary in the individual countries.
JV: You mentioned Covid earlier, what impact has that had on your sales processes?
JL: Weirdly enough, it has actually worked out to be an accelerator for us. To begin with I was really worried when schools were closing and our salespeople couldn't contact anyone. But we decided to be really proactive and to offer free online training to schools about how to cope with distance learning - it’s made a big difference for us.
JV: You’ve been very successful in scaling the WizKids proposition into different markets. What top tips would you give to Nordic EdTech entrepreneurs on that?
JL: I think you have to start by deciding whether you want to have a direct approach or go through partners. To be honest, I think it’s preferable for most companies to have a direct approach because you can then have a really clear idea of what’s happening with your customers. This is also really helpful in highlighting where your product addresses their needs.
Once you’ve found what works it’s really important to stick to that winning formula and just focus on that. That’s much better than trying to do too many other different things.
JV: The subject of scaling internationally links neatly into your recent acquisition by Texthelp. Can you give me a little background to how the deal came about?
JL: We’ve had a lot of enquiries over the years from people who were interested in investing in us or acquiring us, but we’ve always said no. However when Texthelp contacted us earlier this year, it felt different and was a more serious opportunity.
Of course, we knew Texthelp to be a strong international competitor, who create really good products. We had seen their growth, their relationship with Google and had been really impressed by what they had achieved. We also recognised that working with them could be a way to rapidly get our products out into world markets and of course, vice versa, to take some of their products and sell them into our core Nordic markets.
So the conversation started there, but it fairly quickly became clear that we not only had a strategic product fit, but there was also a really good cultural and personality match. We seemed to share the same bad sense of humour and things quickly fell into place. The deal was then closed here in Denmark in July.
JV: What difference will the deal make to your customers and partners?
JL: To begin with, I don't think there will be much change. Wizkids will continue to operate as a stand-alone brand and a stand-alone business within the Texthelp group.
But my hope is that we’ll take the best elements from the different products and combine them to make them all even better. We’ve already had discussions about how this will work. For example, we have stellar integrations with the Google platform, which I know will be of benefit to Texthelp products. They have a Windows integration that will help us and I’m looking forward to learning more about their data-driven set up.
On the sales side, we’ll be able to offer customers a wider range of products from across the group and they need only deal with one contact rather than two.
JV: And what’s the long-term vision for the combined business moving forwards?
JL: Clearly the ambition is for Texthelp Ltd to become a truly global company and the market leader in the assistive technology space.
The group aims to grow a really strong presence all over the world, particularly in Europe and the US. I’m looking forward to being part of that journey. I don't know what my role will end up being, but I do think it's really exciting!
JV: On the subject of your relationship with Google, how reliant is your business on them? Where would it leave Wizkids if Google decided to leave education?
JL: Where would that leave Google?!
Of course, it depends on the product - if they closed down the G Suite Workspace for Education then that wouldn’t be good for EduLife. But AppWriter works on all platforms and is truly platform agnostic.
We enjoy a really good relationship with Google and have certainly grown on the back of their expansion. We’re now the only Google for Education Premier Partner in Denmark, so yes we’re intertwined and somewhat reliant on them.
JV: Does the relationship cause any problems with customers? I'm aware of how fanatical the Danes are about GDPR, so do customers question that as you work with Google you’re just interested in harvesting student data?
JL: Yes - that perception does create challenges for us with some customers. As a result, we’ve hired a full-time member of staff to ensure that we comply with all GDPR regulations and we conduct an annual audit of all of our activity.
Obviously we also have customers in different countries, which means that we have to follow a variety of laws and regulations. We also have to make local data processing agreements. So it’s not always easy!
JV: To what extent does being a Danish company influence Wizkids and the work that you do?
JL: I think there are three main areas of impact.
Firstly, there’s a strong design tradition in Denmark and the Nordics, which has had a big influence on our product. Part of being Danish is also about trading with other nations. You know the Danes are often called the merchants of northern Europe, so perhaps it’s in my blood to trade and expand internationally!
There’s also an important sense of giving everyone equal access to education and opportunity. I think that certainly underpins our approach to supporting all learners.
JV: One final question - when you look back on your work with Wizkids, what are you most proud of?
JL: I'm really proud of being able to pull together this team of people from all around the world and creating these amazing products. Many of them have been working here for more than 10 years so it’s great that we’ve been able to keep that small company feel. Even though we now have more than 50 staff, it still feels more like a family. I’m really proud that we’ve managed to grow and still maintain that.
JV: Thanks very much for your time Jonas. It’s been great talking to you!
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