How a board’s experience helps accelerate growth

Online training provider RedSeed has been something of a slow-but-steady burn. However, founder Anya Anderson is optimistic growth is about to accelerate through a new coaching product sold directly online. 

Anderson and three others co-founded the company focused on retail training in 2009 in Christchurch. It was Anderson’s idea after she had been working as a training manager for Hallensteins Glassons and saw a market gap for an online solution. 

Typically retailers have high turnover and RedSeed offers them a way to provide training to new staff dispersed across geographies at a reduced cost. 

It quickly gained big-name brand customers including Anderson’s former employer and the Warehouse Group. The company now has more than 100,000 active trainees in New Zealand and Australia, and has around 200 courses in its content library. 

Venture capital investor Punakaiki Fund first invested in the company in 2015 to help expand the team and do further product development. It eventually bought out Anderson’s co-founders and is now the majority shareholder, with a 47.8 percent stake, while Anderson holds 44 percent.

Punakaiki was keen to see a formal board established alongside its investment – something Anderson encourages other aspirational founders to think about early.

Chair Shaun Ryan was the co-founder of listed tech company SLI Systems, which was based alongside RedSeed in the EPIC (Enterprise Precinct and Innovation Campus) building created after the Christchurch earthquakes to help tech companies with recovery.

Ryan was still too involved in running SLI when Anderson first approached him, but once he stepped back from that role, he was appointed RedSeed’s board chair.

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The governance

As a first-time entrepreneur, Anderson says it was useful having someone experienced in globally expanding a digital company and who wasn’t involved in the day-to-day business.

“There is more of an outside viewpoint to keep you on the straight and narrow because it’s quite easy to get your shutters on and go down a rabbit hole potentially.”

Staff now number 20 across New Zealand and Australia, and Anderson cites managing cash flow and dealing with human resources as her biggest challenges.

Ryan sees his role as acting as a coach to Anderson, helping bring her out of the details of the business to see the bigger picture on a regular basis.

“We have a one-on-one meeting every week in addition to the board meetings that happen, and I see that as a way I can talk to her about any particular issues that are happening in the business and draw on my experience at SLI and other board roles I have just to give advice and keep pushing.”

In his view, the board, which also comprises Lance Wiggs from Punakaiki and independent director Jordana Clarke, must be hands-off from management but available to advise whenever needed.

“It depends on how well the company is going; if there’s a crisis then you get more involved if you can add value.”

“I think there is a big advantage in the board not being involved in the day to day so we can have a different perspective than what the CEO and other executives have, because otherwise you get crowded out by the minutiae of different deals and people and whatever else is going on.”

He and Anderson say it’s healthy to change the board as a company grows, which is why Clarke was appointed three years ago, but it is now about right sized for where the company is at.

The key thing Anderson values in her relationship with the board chair is good communication.

“The number-one thing for me is that you feel you can communicate anything, from the personal to the business, because they are so intertwined.”

“And part of that communication is being comfortable enough to challenge the founder,” says Ryan. 

“Often CEOs don’t get challenged by their team much, so I think that’s an important part for the chair to do and sometimes just play devil’s advocate and challenge decisions.”

Anderson also likes that Ryan is pragmatic about what is achievable compared with some directors who are more idealistic. 

“When the shit hits the fan it’s quite good to have somebody who goes ‘here’s step one’ and they’re realistic things you can do – they’re not just aspirational.”

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The growth

RedSeed offers customised training programmes along with off-the-shelf content through its Learning Management System. For example, it has helped Icebreaker with its induction programme globally and has also branched outside of retail, working with organisations such as the Burnett Foundation Aotearoa (formerly New Zealand Aids Foundation). 

In 2021 RedSeed acquired KiwiHost, a video-based training competitor that had no online modules but a significant local customer base. 

Anderson says its key differentiator in the now crowded training space is having coaching functionality embedded in its courses. 

“What we do is create good coaches within the organisation and provide learning for those coaches and they can actually build content.”

RedSeed is about to launch a new course authoring tool that allows customers to assemble their own training programme directly on the platform without using a third-party tool, and Anderson thinks that will accelerate international growth. 

It’s the company’s first foray into a freemium business model, where a company offers basic or limited features to users for free and then charges a premium for more advanced features.

“At the moment, our sales approach has been outbound sales so we have a sales team and you can’t buy our product online. This year will be our first foray into that area, which will give us more reach and it unshackles that restraint on growth based on the number of salespeople,” says Anderson. 

Expansion into Australia has taken longer than expected, although Anderson says that seems to be the experience of many Kiwi businesses. 

It now has 16 customers in that market, although some are large umbrella groups with multiple businesses underneath and many are connected to global head offices into which the product is also being sold. 

“Some customers work in seven different languages because they have teams dotted all over the world but we haven’t targeted outside of Australia per se. We just need to get more momentum in Australia to leverage, particularly the new build tool.”

Where and what type of overseas customers buy the new course authoring tool online will help inform where the company should next focus its sales teams’ efforts in another country.

Ryan’s international experience with SLI, which was global from day one and grew to $35 million in annual recurring revenue before being sold, is proving helpful as chair. 

“The experience of going from startup through to running a listed company I think is really useful for someone like Anya. They’re going to take a different path but there’s a lot of similar overlapping experience in terms of how the structure of the company changes as you grow, fundraising, board dynamics and all that sort of stuff,” he says.

Ever an optimist, Ryan saw opportunity for the company when Covid struck and sees even more ahead. 

Anderson says a lot of work has gone on behind the scenes to prepare for further expansion. 

“It’s looking for those opportunities but staying focused. That’s always the challenge: always looking for the next thing but at the same time really staying focused on what you do well.”

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