ATTENTION: Below is a machine-generated transcription of the podcast. Yes, here at Rapport International we talk a lot about how machine translation lacks quality. Here you see an example of what a machine can do in your own language. This transcription is provided as a gist and to give time indicators to find a topic of interest.
Wendy Pease: Hello, friends. Welcome to another episode of The Global Marketing Show. I always learn something new. So I'm excited to record this episode. But before we do that, let's get to our tidbit. I got a funny one for you. And I'm wondering how many of you know about that. You know how we have punctuation periods and commas and stuff in the English language since you're listening in English?
Well, did you know that the [00:01:00] Chinese language does not require punctuation. So, go search for it and read up on it. Get to know a little bit more. If you like our tidbits, you can certainly go to rapportranslations.com and subscribe to the tidbits. And a couple of times a month Rapport International, who's the sponsor of this podcast, sends out some interesting tidbits and facts about culture and language.
So certainly go over there, Rapport, R A P P O R T, translations. com and sign up for tidbits. So let's introduce our guest today. Ivo Verhaegh is Co-founder and CEO of Powerhouse AI, a company that provides warehouse automation solutions. I'm so looking forward to getting into that. He's originally from the Netherlands and he is living in Singapore and running a [00:02:00] business in the United States, so he truly is multicultural.
Ivo, welcome to The Global Marketing Show.
Ivo Verhaegh: Thank you so much, Wendy, for having me.
Wendy Pease: Yes. So talk to me first about your journey. How did you end up living in Singapore?
Ivo Verhaegh: I came here via a program called Entrepreneur First. I always wanted to start my own business. I had something like a couple of years ago on the side and a a year or three ago, I thought like, okay, I want to take the leap. I want to take the jump, set up my own startup. On top of that, I also wanted to live abroad. And so that was always a dream I had for a long, long time. And thirdly, I wanted to start a business, but also didn't want it to do it alone and nobody can do everything alone. Uh, a business is never built alone and a co founder is essential. But finding a co founder is very, very hard stuff. There's a lot of people that have the ambition or the dream to start up a [00:03:00] business, but when you actually ask them, like, are you ready right now?
The answer is often no, because people are often comfortable or happy with that, like the way it is. And the big advantage of Entrepreneur First, that a
program that I started, that it's actually a co founder matching program and you're first investor. And there I could combine all the three things so I could live abroad, the program was in Singapore, I could start my own startup and I could find a co founder.
So that's how I ended up here in January 2021, right in the midst of COVID at that time.
Wendy Pease: Oh my goodness. Okay, so you find Entrepreneur First and it aligns with what you want to do. Did you have the idea for the business?
Ivo Verhaegh: No, at that moment, did not, did not have the idea yet.
So first of all, it's a co-founder matching program. And there's two people, two people with very different skill sets,[00:04:00] but with like similar passions, right? So during that program, I met Kushal, my current co-founder, and we actually started a business off his. Like experience in robotics and in warehousing specifically.
And he saw that a lot of robots in a lot of warehouse were either too expensive or not flexible enough. So, we started with the assumption, like, how can we give robotic grade technology in the hands of people and therefore make automation accessible to the majority of warehouses?
So that's where we started off with, when we met about two and a half years ago.
Wendy Pease: Okay. Tell me a little bit more about the program. So they accept you into the program. Can you tell us like who's accepted, how they match you up with partners, you know, what kind of industries go through that? And then I want to deep dive into how you came up with the idea and what you did to move it forward.
Ivo Verhaegh: Yeah, absolutely. So Entrepreneur First is a venture capitalist, it's a [00:05:00] VC, right? And so they're looking for people that they believe could be successful founders. They're looking for people who have the traits of an entrepreneur, of a founder.
They're quite strict with that. I don't know the exact statistics, but I think only one or one and a half percent of the applications gets approved. So quite, quite strict. So they set up like a, like a pool of people about twice per year, about 80 people in one group. And from there they look at your personality traits, they look at your motivation, they look at your interests, and then they recommend
either some people that you have to chat to or you should talk to, and then it's really up to, you know, the two of you to determine like, Hey, is there a click? Do we really have common interests?
Do we work productively together as well? That's a very important metric as well. Then you try and work together for a couple of weeks or a couple of days. You figure out, Hey, does it work? Does it not work? If it doesn't [00:06:00] work, then you break up. So to say, that's how they call it. You break up and yeah, then you just network within that group.
Maybe find another partner, have those difficult conversations, work together for a couple of days, couple of weeks, figure out, okay, is there a click, if there is a click, hey, you really take off, if there is no click, that's fine, you just, and network with the other peers in the group, and it's really a pool with very bright and great people.
I've been very fortunate to be part of that as well.
Wendy Pease: Okay, so you meet your partner and you guys click, you're productive, you work together, you pass. And then you just brainstorm on types of companies you want to start?
Ivo Verhaegh: Yeah, best thing is to start from a problem statement instead of from an idea.
So we started from a problem statement. If you look at my background specifically, it's a little bit more generalist. I have a consulting background and my co-founder has [00:07:00] a technical background, has specific skills in AI, specific skills in computer vision. And when we met, he had this specific problem statement with regards to robots being not flexible enough, being too expensive. So we had the assumption, and that's where we actually started off with. We had the assumption, what if we make people more productive with robotic grade technology? We literally give it in their hands. So that's the assumption that we started with.
And then we started to talk to people within the market. I think we had about 300 conversations with people in like the logistics sector to really figure out, okay, is that assumption what we have? Is that right? What pains do you have? What are sure, you know, your day to day work look like, like these type of conversation in order to get to a more concrete product idea.
Wendy Pease: And at this point of the idea formulation, are you thinking you're going to go global? Are you thinking about [00:08:00] one market?
Ivo Verhaegh: No, absolutely. Absolutely. The idea from the beginning is always to make it big. It's also, to be honest, expected, Entrepreneur First is behind us.
They're an investor in our company. It's also expected that we grow it big. And that's also in line with our ambition. And especially if you look at Singapore specifically, it's a five million people market. It's relatively small. So most companies that start in Singapore, they always have a global perspective already, almost from these, like by design, I'd say.
Wendy Pease: Okay. So that's a real advantage of starting a company in Singapore, is you're thinking global from the start. Whereas like in the US, many companies won't think global from the start.
Ivo Verhaegh: Yeah, it's a huge market. Indeed, the US yeah, that's where these two markets, Singapore and the US definitely, definitely differ. If you want to make it big, like most companies, they need to think global. In the US, you can start up a very big company and stay within the country.
Wendy Pease: [00:09:00] So if you're thinking global from the start, how does that frame what you're trying to build differently, or how do you have to think differently when you're thinking global from the start and not just a domestic market?
Ivo Verhaegh: You have to learn about the different pain points and challenges of your target market. And we figured out actually quite quickly that those pains are a little bit different, among the different countries. And maybe Singapore is as well a little bit the odd one out in Southeast Asia.
It's an extremely wealthy country, with an extremely high standard of living. Contrary to a lot of the countries that are around that have significantly lower salaries, have also a bigger labor force. So one thing we figured out, like we actually started with the assumption, or actually the main goal behind our company is to support warehouses, to rely less on scarce human labor.
But when we started talking [00:10:00] to people in Indonesia or in Malaysia, we actually figured out that a lot of , issues within the warehouse are solved by adding more headcount to it, which is not really an option in Singapore, let alone in Europe or in the US so it really made us realize, a lot of these Southeast Asian countries are probably not an ideal target market for us. Then I maybe make the bridge to the US that's also one of the reasons why we started to, and now really focus on the United States where there is a shortage in labor, where
labor costs are really high, where warehouses have to become more data driven because they are more process aware.
That was something that we learned along the way and figured out along the way that, hey, there are these very clear differences between countries and the issues they face.
Wendy Pease: Okay. So you were looking for markets that really had a labor shortage or expensive labor. That's where you were going to do best.
Now tell us more [00:11:00] about what your company does.
Ivo Verhaegh: In short, we make the job of the warehouse associate. as easy as just taking pictures with a mobile device. So really to enable warehouses to be much faster, but also less reliant on very scarce labor. So the issue with current automation solutions like robots and drones, are that they're very expensive, not very flexible, so by making a very asset light solution, like our solution runs on a mobile phone, we aim to make warehouse automation accessible to the majority of warehouses.
And we support these warehouses to become, first of all, fully digital. We use artificial intelligence, AI features to automate all kind of counting and checking tasks within the warehouse. So think of taking a picture of a pallet to count the number of boxes, or take a picture of a shipping document and [00:12:00] compare the content within the document with the content on the ballot.
Or the data in your systems. So that's how we support these associates and those warehouses and to really become faster, more accurate and more data driven.
Wendy Pease: That's fantastic. So anybody can walk around and just take pictures. So it's not the pick and pack part of the warehouse, but it really is the inventory and the counting that goes behind the scenes.
Ivo Verhaegh: Yeah, in the end, warehousing is all about picking, packing, and storing the right items in the right quantity as efficient as possible. And it is really in the right quantity and the right item. So in every process within the warehouse, somebody is checking or verifying something. And that's what we automate.
Wendy Pease: Okay. When did you start and how has your market entry been going?
Ivo Verhaegh: So we started in May 2021, initially with a slightly [00:13:00] different idea. We pivoted in 2022, I have to recall when it was exactly, that must have been somewhere in the middle of 2022. So we had a different product idea, in short it was a solution for the picking process within the warehouse that would automatically check if you would pick the right goods.
But it was a hardware solution, so it required us to literally create a device. We figured it didn't have enough ROI so based on what we learned from that, based on the conversations we had, we actually pivoted to our current product.
So that's how our product has evolved over the past two and a half years.
Wendy Pease: Okay. And so where are you now? Are you still in development or are you in, in the market? Are you selling?
Ivo Verhaegh: Yeah, absolutely. We are in the market. We are working with companies like DHL, who are using our solutions.
We've been working with Unilever, DSV in the US, also with a couple of large and really renowned logistics companies or manufacturers. We are fully commercialized.[00:14:00]
Wendy Pease: And what did you have to do to adapt that or is the same platform used across the world?
Ivo Verhaegh: Yes, we use the same platform across the world, but like within logistics and within warehousing, you actually sell a solution instead of directly a product.
So every warehouse, every company is slightly different and we adapt to that really to make these solutions suit to that specific warehouse environment. So we made sure that also on the product side, we are as modular and as configurable as possible.
Wendy Pease: Handle the different languages. I would imagine that the people in the warehouses don't all speak English.
Or Dutch, or Chinese, or one language.
Ivo Verhaegh: Yeah, that's true, that's true. I mean, it's maybe the advance, so we've mainly been focusing now on Singapore and the United States, also on the Netherlands, and in all three of those countries, the warehousing companies that we've been working with, quite proficient in English.
But we have indeed on our [00:15:00] roadmap to expand to other languages like indeed Spanish, or if you talk about Singapore here, like Chinese, Malay or Tamil or Hindu, for example.
Wendy Pease: Okay. And so, uh, right now it's all in English, so you'll, you will have to adapt that. Yeah. That makes a lot of sense. What have been some of the mistakes you've experienced?
Ivo Verhaegh: To be honest, we realized too late that Southeast Asia is not our market. So that has been something that we should have realized quicker, in my opinion. And also one thing we learned is the importance of focusing on a single market or on a very specific, either niche or geography, because it's very hard as a startup with limited personnel is to focus and get your message across in a larger pool of countries, so that specific [00:16:00] focus, that's also something that we learned over time and that we didn't do all the way from the beginning because we thought we can deploy remotely. We use the internet and everyone can find us on the internet, but that's not really how it works, right?
Um, you still have to guide people through EFEA, you still have to get your message across, so where do you get your message across? Like, all these things you have to think about and you better focus because of limited resources and time.
Wendy Pease: Yeah, there was a earlier podcast with Brittany Cooper who talked about that.
She worked at a company that offered travel services and they tried to go international all at once and the company didn't end up making it because their reach was too wide and too thin. And she said, looking back, they wish they would have narrowed in and then expanded from that.
Ivo Verhaegh: Absolutely. And we also learned how important face time still is or in real life, like meeting in real life with our prospects and clients.[00:17:00]
Logistics is a market that's a little bit more traditional. So for that reason, how we also are building up our team in the US for example, and we do fly to our prospects. We do meet them in real life. And if you want to do that all over the world, that's just simply impossible as a startup.
So you have to make tough decisions. That also means that sometimes we get clients from a country that we do not support that we have to say no to, and that's of course very hard if you're in the earlier stages of building a business to actually say no to business, but it actually is the key to grow in the longer term.
Wendy Pease: That's interesting. So you've had companies and countries that you're not supporting reach out to you. Like European countries or which countries would you not support at this point?
Ivo Verhaegh: Yeah, absolutely. We also get, for example, Nigeria, India, we had Mozambique, we have Brazil.
[00:18:00] That's just much harder for us to support at at the moment.
Wendy Pease: Right. So, well, you know, you're gonna have global success when you're starting to see that . Is there a way that you could build a module? That you could then translate that they could have something off the shelf.
Or is that just take too many resources from a startup to try to do that?
Ivo Verhaegh: Off the shelf? Yes, we aim to go towards what we then call product led growth. But we also have to keep our market in mind. Logistics, where two characteristics, one is still like personal face time is appreciated.
And secondly, a warehouse, like maybe to the outside where a warehouse is a warehouse, like everything is the same, but it's actually not true when you dive deeper into the processes. So having a fully off the shelf, out-of-the-box solution. of course it's a dream that we work [00:19:00] towards, but I don't think it's too realistic in the short term, given the market dynamics.
Wendy Pease: Okay. We've worked with clients before at Rapport International where we'll go in and help them set up a buyer's journey online so they can go in, read about it, understand how it would apply. And then purchase the product. So there's minimal support, but with your solution, somebody does need to go to the warehouse, understand what's happening to help them set up and learn how to use it.
Ivo Verhaegh: It's not required. We can do fully remote deployments as well. We have run fully remote pilots as well without us visiting the warehouse, but we just see that first of all, it's very much appreciated if we pass by and it makes communication a lot easier, it's worth the trip both from a client perspective, as well as from a perspective of us being business owners is to actually [00:20:00] visit the client.
Wendy Pease: Okay. Is there any kind of warehouses that you particularly specialize in or? I mean, did you have to niche down on that for your target market or are warehouses enough different that it's anybody who's warehousing stuff?
Ivo Verhaegh: No, no, no. We definitely specialize there as well. So we focus on the larger size warehouses.
So above 100,000 square feet. And in general in sectors like health care, pharmaceutical, fast moving consumer goods, consumer goods itself and automotive. Those are the ones that we focus on, on most of where we see most value for a product like ours.
Wendy Pease: Okay. So it's going to be smaller things that you're counting and they're moving fast.
And so you've got to have accurate statistics to know what you have.
Ivo Verhaegh: Yeah, mainly like warehouses with a lot of turnover or warehouses where accuracy is very important, like healthcare or [00:21:00] pharmaceutical, where you have to check a lot of stuff, that's where we excel.
Wendy Pease: Yeah. That makes a lot of sense.
What advice would you give to companies that are starting up on how they pick the target market? Cause I can see that was a little bit of a pain point earlier on when you were working with it. You had to pick countries and the types of warehouses and industries that you were working on. So a lot of research went in there.
You talked to 300 people, but how did you go about building that? So you knew who your targets were.
Ivo Verhaegh: Yeah, it's very important to realize what you actually solve and what the value proposition of your product is. And also what your technical limitations are, for example, so like these are some of the dimensions that went into our decision.
What we solve is we make warehouses faster and more accurate, but what is the [00:22:00] advantage of speed? So oftentimes you can put a number on that, and you know that in higher income countries, like an absolute speed improvement is worth more than in lower income countries, for example.
We also have some technical limitations, for example, where we require certain data for the product to work. And once we started talking to people in different countries, we also figured that in some countries, without going too technical, the foundation of data was better than in other countries.
All these elements went into that decision criteria. Next to it, we are a VC-backed company. So we also have to think, which market will enable us to grow fast, first of all. And secondly, will also enable us to raise a successful round.
So we are, for example, funded by Y Combinator, which is an American investor. Lots of the most successful investors are based in the US as well. And they appreciate it[00:23:00] if you have a presence in the US market because they know that market better. So, and that's another argument to look more at the US market. So there are a lot of levers, a lot of things that went into that decision that the US is the number one target market for us.
Wendy Pease: Now, with the other companies that are in Entrepreneur First, does the US end up being the number one market or what do you know about which markets they're targeting?
Ivo Verhaegh: I actually do see that more and more. And maybe it's also because a lot of the companies that were started in EF were started by people who are not necessarily from Singapore. So that's also a thing. It means that the people who came here have smaller networks.
Of course have a lot of affinity with the culture, but haven't grown here. Maybe starting a business in a new country with a different culture is an additional challenge. And so that's one. Secondly, [00:24:00] what we also see a lot of startups at the moment focus on software, software as a service and in Southeast Asia, that's still a very hard sell and in Europe and the US companies and people are much more used to paying for software.
So I see also with a lot of friends here, who are great people, great founders who are actually making that move towards the US.
Wendy Pease: Interesting. And where are a lot of the people that have been accepted from the program from?
Ivo Verhaegh: Very diverse. From Canada to France to Spain to Philippines to Indonesia to Singapore itself.
It's truly a global cohort.
Wendy Pease: And they've been able to figure out how to pick people that can grow a global business. Yeah. Huh. That is so fascinating to me. We're running out of time.[00:25:00] And I could go on and keep picking your brain about this because I think they've got a real different niche by doing that and pulling people in like you and the other people.
Yeah. What advice would you give to global marketers if they're starting or trying to grow their companies internationally?
Ivo Verhaegh: To grow internationally specifically. Be there.
Wendy Pease: Well, or to grow big. Your mission is to grow big and that means global from where you sit. So what advice, yeah, for growing big?
Ivo Verhaegh: I mean, in order to grow big, first of all, you need to think big. That's the most important thing, and get a superstar team. That's very important. A successful company is built by people. So if you have ambitious people, people that are curious.
People that take accountability and responsibility. And people who have specific, you know, knowledge and skills in the market that you are serving. I think that's very, very [00:26:00] important. And I think that's also what Entrepreneur First is looking at when they select their founders for their program.
Wendy Pease: Okay. Do you think that's a natural thing? Or is there ways to break somebody who may be a superstar to break the blinders down to help them think bigger?
Ivo Verhaegh: Yeah, that's a good question. There are truly differences. I'm originally Dutch. And Europeans already have a different mindset than Americans.
I think Americans in general think bigger than Europeans. And I'm generalizing, I realize that, but for you as Americans to sell, it seems like you're natural at it. Right? Where I learned a lot about that is by surrounding yourself with other founders, that is super, super important.
Other founders who are in the exact same situation [00:27:00] who also indeed have to sell, also have to expand. You will learn so much from that. So much. That's probably next to the program that I participated in EF, probably the most valuable thing in contributing to our growth and my personal growth as well.
So surround yourself with founders.
Wendy Pease: That's fantastic advice. That is really good advice. Go find your tribe.
Ivo Verhaegh: Yeah, it, it, actually now I realize how important, so sometimes I don't think about it, but I just realized it is of vital importance. Imagine all your friends having, having a 9 to 5 job. Being fully settled, do not have, you know, those dreams of starting a business, it's very hard to succeed in that environment.
And of course, everyone is free to make their life choices, but if you want to be successful, you will have to change your tribe as well, or at least expose yourself to a tribe [00:28:00] of founders for a significant amount of time of your week.
Wendy Pease: Yeah, there was an organization called Count Me In, where I found a bunch of women founders, there is Entrepreneurs Organization, which I'm part of, which is a global organization with founders.
And that certainly inspires me. And then there is another one of women, IWEC, International Women's Entrepreneurial Council, of women entrepreneurs around the world. And so you have Entrepreneurs First, which is based out of Singapore. So if you're in Singapore, well, no, anybody around the world that is interested in doing that could reach out.
Ivo Verhaegh: They have a global network. So they're not only in Singapore, they're also in I believe in New York and London and in Berlin. So they are in multiple places, also part of YC. So there's also that network and in general, there are always some communities of entrepreneurs or founders.
So yeah, my advice would be find that [00:29:00] community and become part of it, it will change your life like literally.
Wendy Pease: All right. Well, that's a good place to end. That's really good advice. And I haven't heard that one before in The Global Marketing Show. So that's good. All right. You know, that we always end the show with the question.
Yeah. The question is, what is your favorite foreign word?
Ivo Verhaegh: Okay. I got two in my mind. One is English and one is Dutch. I'll start with the Dutch one and it's the word bolleboos and bolleboos means a bright head or a smart person in Dutch. And why is it nice? I think it sounds very nice in my opinion, and I think a lot of Dutch people think so too, because it has been chosen as the most beautiful word in the Dutch language over the past 150 years. Uh, so that's, yeah, by like the main dictionary company in the Netherlands [00:30:00] called Vandale.
Wendy Pease: Okay, so it's bolleboos, which literally translates to bride's hat.
Ivo Verhaegh: Bride hat or or a clever person, a smart person. Yep.
Wendy Pease: Bride like a, you know, a groom and a bride that are getting married?
Ivo Verhaegh: Oh, no, no, no. Like a smart person.
Wendy Pease: Oh, oh. I'm sorry. Yeah. Bright.
Ivo Verhaegh: Yeah. Hat bright. Sorry. Yeah. As opposed to, that must be my Dutch accent. . .
Wendy Pease: I'm glad I asked for clarification.
Yeah, like a bright hat as opposed to like a dunce cap, which would be somebody not so smart. But this would be a bright hat is you're a smart person. Bolleboos. That's a great one. I love that. . Yeah. Okay, and what's your English one?
Ivo Verhaegh: My English one is introspective. Ooh. So people sometimes ask, what is the number one superpower you'd like to have?
And for me, that is to fully get to know myself. And I think [00:31:00] that is a lifelong journey. And in order to get to know yourself, you need to be introspective. You need to reflect. It's something that everyone should do, and not just once per year, but constantly, it makes life so much better if you're introspective, if you're intentional.
So that's the reason why I chose that word specifically.
Wendy Pease: Yes. And it's not easy to get to know yourself. There's things about you that you won't like , and you can't walk away from them . Exactly, exactly. But it is so true. You can't love anybody else. You can't get to know anybody else unless you know where you're coming from.
And that's like the number one advice on doing cross-cultural work too, is because you've got to know your own culture before you can get to know somebody else's culture. So yeah, Ivo, this has been such a fabulous and interesting podcast. If people want to find out more about Powerhouse AI or [00:32:00] connect with you, how can they find you?
Ivo Verhaegh: Yeah, they can of course connect with me on LinkedIn. So search for my name, Ivo Verhaegh. I hope you will have not too much trouble in spelling it. It's a little hard.
Wendy Pease: Why don't you go ahead and spell it? Yeah.
Ivo Verhaegh: Okay. I'll spell it. So it's IVO.
That's my first name. And the last name is V E R H A E G H. And otherwise, if you go to powerhouseai.com or you type in the company name and you always find me somewhere.
Wendy Pease: Okay, good. And we'll put all that information on the show notes too. So if you didn't catch it while he was talking about it, it will all be there.
Well, thank you so much for taking the time to join me today, Ivo.
Ivo Verhaegh: Thank you. I really enjoyed the conversation, Wendy. Thanks a lot for having me.
Wendy Pease: Oh, sure. All right. If you enjoyed this listeners, please forward this on to anybody, you know, that works in a warehouse, particularly in his target markets of Singapore or the United States.
Sounds like it's a fascinating [00:33:00] company that they founded. It's run by a couple of great people that have been screened very difficult to get into Entrepreneurs First. And then also give us a five star rating or subscribe to this so you can continue to hear these great interviews about global marketing.
So we will talk to you next time and thanks for tuning in.
