A small firm builds enterprise applications for a mobile world
Thanks to a Miami-based high-tech company, shopping for a new car isn’t just about a test drive anymore. At Audi dealerships in Mexico, sales representatives greet visitors with an iPad running an application made by a company called Leapfactor. The app shows an entire range of models, trims and options, and narrows down alternatives so that potential buyers can choose a price range and watch videos describing their car of interest. While customers still look at real cars and take them for a spin, the Leapfactor app—called Salesfactor—makes it easy for staff to answer questions and gives customers the chance to look at a variety of models and price alternatives while “building” the car they want on a vivid color screen.
Salesfactor is one of about 50 cloud-based apps developed and sold by Leapfactor, a rapidly expanding business founded by a group of Latino entrepreneurs in 2009. The company—whose name is derived from Light Enterprise Access Point—was set up by Lionel Carrasco, the firm’s Bolivian-born CEO, and five co-founders from Latin America with the goal of providing secure, attractive and easy-to-use business apps for any modern mobile device. Carrasco saw the ease with which people could access apps on their iPhones and asked himself why businesses couldn’t do the same thing.
“We saw an opportunity,” says Carrasco, who earned degrees in history and computer science and has worked for more than 25 years in the IT industry as an executive and consultant. “We develop ready-to-use apps that address many of the basic needs of employees, business partners and customers and can interface with virtually any back-end [computer] system,” he adds. “Leapfactor can offer business, employees and partners the opportunity to work anywhere, anytime.”
After founding the company, Carrasco and his partners began building a platform for Leapfactor, established a cloud at Miami-based Verizon subsidiary Terremark, developed their first apps and made their first sale in 2010 to a financial services company. They also began seeking venture capital and by the end of last year had obtained more than $13 million in funding. “Right now, the company’s capitalization is good,” Carrasco says.
Leapfactor expanded its staff, hiring developers at R&D centers in Mexico City, Argentina, Bolivia and Uruguay. It expects to have more than 65 employees by the end of the year. It also promoted its apps to potential clients in Mexico, Brazil and the United States, and today has more than 25 customers, including Avon, AstraZeneca, AXA, Bayer, Chase credit cards, L’Oreal and SAP.
According to Carrasco, Leapfactor’s revenues grew by 48 percent last year and are expected to double or triple this year. “The reason for that accelerated curve is recurring revenues,” he adds, as revenues from new clients are added to existing customers. The company expects to become profitable in 2013. “Three years ago, some people looked at us like we were crazy,” Carrasco says. “They said you don’t sell to enterprise [customers] for less than $1 million. You’ll never make money at 99 cents or at $9.99 per month per app.”
Those skeptics were wrong. The privately held Leapfactor, which now has offices in Miami, Mexico City, Sao Paulo and Buenos Aires, is developing new apps and modifying existing ones to meet the needs of small and large enterprises. The apps are typically sold as a service, which means that customers do not need to make large investments in servers and IT staff to connect programs to employees.
In other words, companies can save money with Leapfactor apps. While a large business might have to pay $2,000 for a license so that an employee can control petty cash online, they can pay much less for a small application that Leapfactor can offer on an iPhone.
At large companies, costs may start at $1.99 or less per month for each employee, while firms with fewer workers could pay $19.95 per month. “We have flexibility in pricing,” Carrasco says. The apps are “performance driven,” he adds, and in the end, “it has to be affordable to the customer.”
Currently, the company is focusing on certain apps for direct-selling companies like Avon, and is offering more industry-specific apps. One target, for example, is the pharmaceutical industry, where sales reps visit physicians and clinics.
So far, Salesfactor is the company’s bestseller. “It’s an app that allows sales people on the go to engage with their customers, show their products and take orders,” Carrasco notes. “I haven’t met the company yet that doesn’t want to sell more.”
And studies show Leapfactor is tapping into the right market at the right time. A recent report by Forrester Research Inc., an independent research company that covers business and technology, predicts fast-paced growth in the use of mobile devices, saying that more than 60 million Americans are expected to own a tablet computer by the end of this year. Another Forrester study says that 375 million tablets will be sold globally in 2016.
“By 2016, smartphones and tablets will put power in the pockets of a billion global consumers,” the research company says. “Mobile is the manifestation of a much broader shift to new systems of engagement,” which will “help firms empower their customers, partners and employees with context-aware apps and smart products.”
Carrasco agrees. “Mobility is growing four times faster than the Internet,” he says. “Companies are beginning to realize that they don’t need to do this just because everyone else is doing it, but that mobility is strategic for their business.”
A MOBILE DIRECTION
Florida-based LIMU, which sells liquid nutritional supplements and weight loss beverages, is one of those companies. Its sales force uses Salesfactor on mobile devices to demonstrate the product line, to process orders and to track sales performance, while managers use it to engage and recruit new sales people.
LIMU has been working with Leapfactor since early this year, and is rolling out an app for thousands of its U.S. employees to use on iPads, iPhones and Android devices. “We’re impressed with their professionalism, expertise and their focus on where mobility is going,” Ryan Barson, the company’s vice president of business development, says about Leapfactor. “We knew we needed to move in a mobile direction.”
What differentiates Leapfactor from other app makers? The company prides itself on its ability to build complex apps at marginal cost and in a short time frame. “Some people will take two years and a couple of million dollars to develop an app,” Carrasco says. “We can give you all that in five weeks for as many users as you need.” Their products are attractive to boot. “Our apps are extremely good looking and smart and engaging,” Carrasco says. “They are convenient and have the sex appeal that allows consumers to adopt them.” •