Joonas Lehtinen, CEO of the open source application company Vaadin, answers his cell phone on a sunny morning in San Jose. A couple of days earlier he was in Finland to announce his company’s latest financing round in which Finnish Industry Investment and the Swedish investment company eEquity invested USD 6 million.
“With this investment round, we can accelerate growth faster than otherwise would have been possible. We’ll hire people for product development and marketing, and consequently strengthen our presence in our robust market areas in Europe and the United States,” Lehtinen says.
Established in 2000, the growth of Vaadin, a producer of web application developer tools and related services, has been brisk even to now: it’s turnover has grown 30 percent per year, on average. The company has in many years earned a spot on the highly revered Deloitte Technology Fast 50 list. The profitable Vaadin employs more than 100 people, mainly in Turku, Berlin and San Jose.
“We are aiming for turnover of USD 100 million. We’ll get there when we shift the business focus to scalable products and services. They currently account for just under 20 percent of our turnover, so there is plenty of room to grow. Our goal is to not increase the number of employees significantly as turnover grows.”
A team spirit nurtured
The startup company’s way of operating and strong entrepreneurial spirit stems from the early days of Vaadin when the company was financed purely through internal financing.
“The founders were students who were used to eating crispbread and split pea soup. We didn’t get paid until there was revenue coming in,” Lehtinen recalls, adding: “Nurturing a close team spirit is important in a growth company. Learning and trying out new things gives us momentum.”
“The founders were students who were used to eating crispbread and pea soup.”
Inspired by the unknown
The company has faced many challenges during its 15 years of growth. Changing the management style has impacted Lehtinen closely.
“The ability to share leadership responsibility requires continuous learning. In the beginning, the entrepreneur made all the decisions independently. With growth came a management team and shared responsibility among different departments.”
Learning new things and finding solutions to new problems gets Lehtinen fired up.
“The biggest thing is to be able to constantly do new things. Early on, my thoughts were focused on programming and technical solutions; today I am developing leadership, the company’s strategy and the overall operations.”
Recruiting top talent during the company’s different growth phases perfectly mirrors the trajectory of the globally operating startup.
“Initially, we had no problem finding experts in Turku, but today the majority of people recruited in Turku come from abroad. And since we can’t get everyone to come to Turku, we established an office in Berlin last autumn,” Lehtinen explains.
Customers range from NASA to Nordea
Vaadin’s success story is anchored in its founders’ notion that making web applications with the traditional tools was, and still is, complicated and time consuming. Vaadin set out to develop easy-to-use tools containing ready-made components based on an open source principle.
“The open source approach gave our customers an assurance and it became an important distribution channel. Assurance in the sense that even if our company were to fail, our customers would be safe because other open source developers could always continue our work. We used open source to build a broad developer network that markets and distributes our tools to organisations that we otherwise wouldn’t have access to.”
Vaadin’s customer base includes high-profile global companies and organisations, including NASA, Nordea, Puma and TNT. More than 150,000 users in at least 150 countries use the company’s main product, Vaadin Framework.
- Born in Askainen, Finland, 1975.
- Graduated from Kastu Upper Secondary School in Turku, Finland, 1994.
- Founder and CEO of Vaadin Ltd.
- PhD, Computer Science, University of Turku, 2005.
- Lives in San Jose, California, USA.
- Wife and 7-year-old son.
- “The dream is to find the path that leads Vaadin to Nasdaq.
- Produces web development tools and the related services.
- Established in 2000.
- Turnover EUR 9 million. Profitable.
- 104 employees.
- Offices in Turku, Berlin and San Jose.
- Main stakeholders the investment company eEquity and Tesi.
The article was first published in Growth 1/2016.