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Fastoche Facing the Risks of Scaling Head On

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Fastoche Canada Inc., a mobile software solution that brings all essential data into one user-friendly suite for child care centres, has grown in leaps and bounds since its second place finish at Innovate Manitoba’s Venture’Challenge in 2016.

“We were really focused on a small number of customers in Manitoba,” said co-founder Chris Gaulin.  “We now have reach in Nova Scotia, Quebec, Alberta, Saskatchewan, and B.C. and are building footholds in other provinces.”

This success is due in no small part to the connections generated by the 4-day Launch’Pad Bootcamp in 2016, but also the opportunities afforded through their  win, which included free entry into LEAP – Innovate Manitoba’s Launch’Pad Entrepreneur Accelerator Program – that came with a team of specially selected mentors and an infusion of $100,000 of non-dilutive capital funded by the Province of Manitoba.

“LEAP has allowed us to leverage some different marketing tools that we might not have had otherwise,” said Gaulin. This included, among other things, hiring a third-party lead generation company to validate leads, which Gaulin says has been a game changer for the company he co-founded with his father Mario Gaulin in 2014.

LEAP is designed to get companies through the efficiency stage of development by fine-tuning their value proposition, refining their business model and gaining efficiencies in the sales process before focusing on scaling the business.  “The evidence shows that most startup failures come from premature scaling,” said Jan Lederman, President of Innovate Manitoba. “LEAP gets companies to really focus on preparing for sustainable, profitable growth by validating systems, data and people.”


Putting assumptions aside

Focusing more on the sales channel for the software rather than on the product itself was a key piece of advice the Gaulins received from their participation in the Launch’Pad Bootcamp. It has also been a priority of the company’s LEAP lead mentor, Permjot Valia a powerhouse of credible business, investment and startup advice.

“Permjot has been excellent to work with. He’s a never-ending experimenter and pushes us to validate everything we bring to the table,” Gaulin said. “Permjot will say, ‘Ok that worked but let’s make sure we know why it worked and test different concepts to see what the conversion rate is.”

He added, “It’s been very encouraging to learn from these experiments. These are risks we wouldn’t have taken without LEAP behind us. We’ve been able to learn more and substantiate why something is the way it is…so that we aren’t just running on assumptions.”

Gaulin said that Fastoche has accessed about 50 per cent of the LEAP funding against the milestones established with Valia and Jan Lederman. “We were all on the same page for our milestones. We knew the priorities were around sales and not just on product validation or team issues. We all had the same approach and knew we needed a way to boost sales but LEAP has enabled us to try things we may have been more cautious about or waited longer to do,” he said.

Lederman said that this is a key benefit of the LEAP program. “Fastoche was already well on its way at Venture’Challenge 2016. That’s partly why it made it into the winner’s circle. The LEAP program is designed to help fast track these companies into the market but also to give them the guidance and mentorship to take those chances they may have lacked the confidence or capital to do otherwise.”


Moving ahead faster and more focused

Gaulin cites three key areas that have been positively impacted. “We would have waited another year to do a cold call campaign, we were able to refine our processes and realize efficiencies and finally, as part of this, we’ve taken steps to minimize the technical support time.” This has included implementing several training videos that clients can access right in the app in English and French, so there’s not as many requests for help coming in. The company has also automated its FAQ’s to provide suggested answers to questions coming in.

The LEAP funding and mentorship has also helped Fastoche create tools to onboard customers a lot faster. This included an import tool that walks the child care centre staff through the process of bringing their data, which may be in various places, into the Fastoche environment. “Having all of that data in one place is the ultimate benefit of our solution,” Gaulin said.

He adds that the validation component has helped close more sales faster, from a typical conversion rate of 90 days to less than 60 days and getting closer to the 45-day mark. This has made a huge difference in terms of cash flow, which Gaulin said is one of the biggest benefits of the LEAP program.

The company also has a better understanding that one size does not fit all when it comes to the hot buttons and regulatory requirements across Canada. “While we know the software works here in Manitoba, we’re playing with different scripting to refine messages to different regions.”

Gaulin said that Fastoche is somewhere between the kickstart and execution stages as outlined in the LEAP program. “The focus continues to be on lead validation. We can get to the purchasing people but we now understand the importance of validating those leads and how to target them.” They are looking at different mechanisms to support that, such as getting into the education system (programs that train early childhood educators at the college level across the country) in conjunction with provincial child care associations, labour unions, etc. “We’re not just selling the product per se but working on getting these channels to become advocates for what the product does.”

He again credits both Valia and Lederman for helping the company on this aspect of their growth and startup journey. He and his partner have extensive knowledge of child care and business but neither understood how to grow a business to this scale.

“Permjot has a background in outbound sales, lead generation, and cold calls. He’s helped us through those things we had no idea about,” Gaulin said. This has included helping to calm the owners when take up for the product hasn’t gone as fast as they’d hoped. “He’s helped us understand that customers need to learn the product first but that those customers will stay once they adopt the system. It’s worth putting more frequent touches on those leads because they’ll stick with us longer.”

From day one, Valia has been a proponent for investing more in acquisition of leads, which resulted in Fastoche hiring a lead generation company that can make 5,000 calls in a month where Gaulin and his partner could only do about 500. While Gaulin admits there was some “pain” in getting the right company to support Fastoche’s growth in this area, it has been an integral part of the company’s success. “I just assumed someone would make cold calls and we’d be good but that wasn’t the case. It was more than just providing them with a list of contacts, scripts and answers to objections and questions. We also needed to make sure they were talking the same language and that our processes could work together.”

With validation done through scripting, cold calls, and lead generation, the company is looking at another campaign and will continue to refine the sales process. “We’re no longer just jumping at low hanging fruit but are adding features for a potential sale. We’ve gotten better at understanding when we need to react to market needs. The product is solid, but we’re always adding value-adds to upsell centres on new and expanded features.”


Parting thoughts: just do it

Gaulin said that he recommends Launch’Pad Bootcamp whenever he is talking to new entrepreneurs. “You don’t have to do it just to get a chance to participate in Lift’Off or Venture’Challenge. The entire program is excellent for any business. Some businesses wait too long to do it. Spend the money and do it now! There are huge benefits.

He adds that when Fastoche competed in Venture’Challenge they were looking at debt financing. Now the company, which has grown to three additional full-time and one half-time staff, is self-funded.

“LEAP has enabled us to breathe a little easier for now,” Gaulin said.

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