Kirk Krappe has transformed the enterprise software world with Apttus, a category-defining company with an estimated value of $1.5 billion
Long before disruption was the term du jour, Kirk Krappe MBA’88D was driving it.
In the mid-2000s, while serving as an executive for an enterprise software company, Kirk recognised that a new technology—cloud computing—had the potential to revolutionise the business of contract management. So Kirk decided to lead the charge. He quit his job, recruited two co-founders, and built Apttus, one of the first contract-management companies born in the cloud.
Since then, Apttus has grown into the global leader in the Quote-to-Cash category, offering cloud-based solutions for managing end-to-end business processes in the sales cycle. Headquartered in San Mateo, Calif., Apttus currently has nine locations, 1,200-plus employees and more than 350 enterprise customers worldwide. Its valuation is estimated at $1.5 billion.
With this success, Apttus fulfils one of the core tenants established by its founding partners: “Have excellence in everything,” says Kirk, who serves as CEO of the company. “We call it ‘tier-one everything.’ I am acutely focused on having tier-one employees and making sure customers get the outcomes they want. Excellence is fundamental to our company. We run on it.”
A new approach to customer centricity
From the very beginning, Apttus established itself as a different kind of company—and Kirk proved that he was a different kind of entrepreneur.
Unlike nearly every other enterprise-software company in Silicon Valley, Apttus was launched without any backing from investors. Kirk’s reasoning was simple: He wanted to avoid investor funding so that Apttus was cash-positive early on.
To sidestep the multi-million-dollar cost of building Apttus’ infrastructure, security, data centres and data mirroring, Kirk came up with an innovative solution. He persuaded Salesforce to build his company’s functional features into their platform in exchange for a per-usage fee. The result: Apttus was cash-positive for its first seven years and, instead of investing in infrastructure, devoted all of its resources to solving customer problems.
“Infrastructure and data centres are important—and you must have them—but they arguably offer zero value for the customer,” Kirk explains. “And we wanted this company to be customer-first.”
In keeping with that philosophy, Kirk steered the company’s focus toward selling outcomes to customers, as opposed to selling products or features. “The whole enterprise software world is focused on features, so everyone competes on features,” says Kirk. “But at the end of the day, customers aren’t trying to buy features. They’re trying to solve a business problem. If you’re focused on delivering the right outcomes, you’re going to do so much more for your customers.”
That mind-set led to the creation of innovations such as “Max,” the world’s first Quote-to-Cash intelligent agent that’s powered by machine learning. Max is capable of automating hundreds of tasks that salespeople typically need to perform manually as part of the sales and revenue process, such as creating quotes, contracts or invoices. Salespeople have the option of giving Max commands through the phone—via voice or text—or via augmented reality environments. As a result, processes that used to take people 30-60 minutes to complete can be completed in under five minutes.
“When we showed this to [one of our clients], they were floored,” says Kirk. “They said this will fundamentally change the way their sales guys work. And no one else is doing this in the B2B world. We are pioneering this experience.”
The path to excellence
Kirk’s background is just as unconventional as his business approach.
He was raised in Australia and Africa by an English mother and German father, the latter who served in the French Foreign Legion before founding a company that built roads and dams. The nature of the family business meant that Kirk and his parents were constantly moving; they lived all around the world, including Ethiopia, Nairobi, Kenya, New Guinea, Sweden and then-Rhodesia. Eventually, Kirk moved to England to attend the University of London, where he completed a bachelor’s degree in electrical and mechanical engineering.
After graduation, Kirk took a consulting position at Bain & Company, where he gained an interest in the inter-workings of the business world. That experience, and the desire to sharpen his management skills, compelled him to go to business school. He chose INSEAD, where he had “an amazing experience,” he says. “One of the things I’m a really big believer in—and I learned this at INSEAD—is diversity. The more diverse group you have around the table, the better the outcome. You will all learn from each other and get to a better place.”
That experience made a lasting impression on Kirk. Today, his diverse workforce at Apttus includes about 30 INSEAD alumni. In fact, Kirk is the biggest INSEAD recruiter from the San Francisco Bay Area. He notes that the diversity and intellectual strengths of INSEAD students is a big draw for his company. “INSEAD has amazing talent,” he says.
Kirk may need more of that talent soon. This year, while Apttus prepares to IPO, Kirk says he will continue to work on developing three new companies in the technology space.
“I have too much energy,” he laughs. “I don’t know what to do with it, so I just keep going.”