View the full livestream event here and read the Q&A below.
You hear the word innovation used a lot, in the tech industry and beyond. How do you define innovation and how has that definition changed over the past 20 years?
Chris: It’s kind of like success or happiness, things that people really want to go after, but no one has a good definition for it. Innovation has been a really weird topic where people have assumed, “it’s got to be big. If it’s not huge, it’s not innovation.” That to me is completely false. If you want to build a company like AvidXchange, you’ll do small innovations over a large period of time. So here’s my definition of innovation: it’s better than what it was. That’s it.
The thing about that is everyone gets it. But the other is if you buy into the definition, it puts what I call the “innovator’s burden” on you. And this took me seven or eight years to figure out. The “innovator’s burden” is if it is better than what it was, what is it today? What could it be in the future? And why is it important?
How has AvidXchange made things better than they were?
Chris: When you automate something, the output of automation is time. We’re going to leverage technology, then take that technology and put it in place of human interaction. And I know that freaks some people out, but what you have to do to make it any good is move that person on to something more impactful and important to the business. Because technology is only as good as the people that it serves.
What is the key success metric of getting better than it was?
Chris: The way that fast growth looks and feels is on this brink of chaos. At one point we were growing so fast that we were having a hard time putting goals in and going after those goals because another opportunity would present itself. Some entreprenuers get very uncomfortable with this and they want to slow it down, they want to put the breaks on, and I’ve always been really uncomfortable with that. There’s only one job title that someone has held for the last 20 years at AvidXchange and that’s CEO. If you want to go into why we’re successful, I think it has a lot to do with that.
I think chaos is the new normal here. What impact has Covid-19 had on your business?
Tyler: We went into Covid a little nervous about somehow taking advantage of this period when we knew automating invoices and payments would benefit businesses. People can’t go in their offices, they can’t make approvals, they can’t print paper checks, etc. But what we found was some of our biggest prospects starting coming to us going “wait a second, my employees can’t pay their vendors. Now is when we need to automate.” So we need to actually go on the offensive, not to take advantage of these businesses, but to help them through this. And that ended up being a great decision, because we just closed out a record sales quarter in the history of AvidXchange during arguably the worst period of economic times we’ve seen since ’07, ’08.
Chris: I’m really proud of the company because we made some financial decisions on helping people that didn’t necessarily affect the bottom line, but because we felt like it was good for society. I think companies need to realize that even though they have a global reach, they serve the community where they are planted.
A key component of entrepreneurialism is selling as a form of art. Talk to us about what great selling is and how it impacts the business outside of just driving revenue.
Tyler: I’d say emotional intelligence would be at the top of my list. Being able to relate to the individual and understand their role is so critical when it comes to selling, and then understand how you can propogate yourself through their business. The product tends to take a backseat to the most important thing, which is creating a relationship with the people you are talking to.
Chris: If you want to become the best sales person, here is my advice to you: know more than what’s on the internet. 20 years ago, the sales person was the holder of information, but the internet now holds the information. If you want to be helpful to your customers you either need to know more than what’s on the internet, or you’ve got to help the customer weed through the information that’s bad on the internet. You’ve got to have unique information that’s key to the customer.
We’re building an innovation corridor here in Houston, and Tyler you’ve seen it. What were some of the early challenges as an entrepreneur in Houston?
Tyler: I found that Houston actually had a history and density in fintech, you just had to find it. So I’d recommend to entreprenuers, go look for the money, the folks and the employees that will know your business the quickest.
Take us back to when you exited your company. What was that process like and your counterparts on the other side?
Tyler: Our biggest competitor was AvidXchange. Strongroom had built a beachhead in an area called Automating Payments for Home Owners Associations, and Houston actually has a lot of HOAs. It’s a national industry with about 351,000 associations across the US that manages about 100 million Americans. So it was an area that AvidXchange had wanted to get into and I like to say, knock on wood, that we were an immovable force. They approached us about acquiring us and it was this delicate dalliance because they were a competitor at the time. But it ended up being one of those acquisitions where 1 and 1 makes 3. They’ve invested in our great business, we’ve quadrupled the headcount in Houston, and my proudest moment has been that many of the employees at Strongroom have had huge growth opportunities inside AvidXchange. Nothing about the acquistion makes me more proud than that.
How did the HOA piece fit into the AvidXchange business model?
Chris: Years ago, AvidXchange wanted to get into the HOA space because we were already into commercial real estate–that was our initial niche. Once we got into HOA we started running into Strongroom, which really started irritating us. And one of the biggest fears with acquistions, especially from the company that gets acquired, is that this company is going to come in and steamroll you, take whatever they can, and then just let it die. But what is so interesting is that Strongroom was attractive to AvidXchange because they owned the automated payment process in HOA, and we didn’t. This is just such a great partnership. When Strongroom was added to AvidXchange–I swear to you this is true–our culture improved.
What kept you motivated on your journey to successful entrepreneurship?
Tyler: I’ve always said the journey is actually the prize. I felt like we had a good product and a big market to serve, and I wanted to win. We weren’t paying each other very much in the early days and money wasn’t the determining factor for me. I just wanted to build something lasting and important and build a great team. If you do all the right things with the product, customers and your team, the financial rewards will come.
Chris: I always say money equals value, so go after the value. If you make a lot of money then you’re providing a lot of value.
About Tyler Gill and Chris Elmore
Tyler Gill received his MBA in Finance from the University of Chicago and worked in senior leadership positions for financial software and financial services companies in both Silicon Valley and Houston, TX. When Tyler and Chris first crossed paths, Tyler was the President and CEO of Strongroom Solutions in Houston, which specialized in automated payments for Home Owners Associations. When Strongroom was acquired by AvidXchange in 2015, he shifted to the Vice President of Sales, HOA, where he helps HOAs streamline their software automation and accounts payable operations. He continues to be an active member of the start-up and fintech communities in Houston and across the country.
Chris Elmore is AvidXchange’s Senior Sales Performance Director and has been with the company since its early beginnings in 2000. He leads a weekly class for AvidXchange interns and is a professor at UNC Charlotte and Queens University of Charlotte, teaching Entrepreneurship and Innovation. Chris also serves on the startup boards of 4 Charlotte companies and advises 3 more as well. Named a “Startup Hero” by North Carolina Business Magazine, he shares his knowledge and expertise of automation, innovation, successful startups, and technology through speaking engagements around the country.