Mike Werch quit a job with a telecommunications firm in 1999 to start Bloomington-based Video Guidance, which focuses exclusively on videoconferencing. And he hasn’t looked back. The firm has grown to 35 employees and recently struck a deal with a Norway-based video conferencing software company called Pexip that provides “personal meeting rooms” for any number of users on video, voice and mobile. Werch hosts a seminar this week at Video Guidance about how new technologies are shaping the way businesses, schools and nonprofits communicate and collaborate. For six consecutive years, Video Guidance has been named to the “Inc. 5000” list of the nation’s fastest-growing private companies.
Q: Why did you start Video Guidance?
A: All three companies I had worked for sold video conferencing only as an add-on to their core business, which was not video. One was Sprint, which has morphed into a wireless company. Norstan was a local telecommunications firm that was sold. They don’t do any video conferencing. Another, Acoustic Communications Systems, my last employer, also was sold, after I left to start Video Guidance.
They had no interest in taking on user-adoption or service. Their customers bought these expensive systems as a way to reduce travel costs, but the systems were too complicated and, ultimately, they didn’t use them. Slowly, some manufacturers began to introduce more-affordable systems but there was a lack of service. As a result, there were too many dissatisfied customers. I saw a huge hole … and an opportunity to begin a business that would focus its core competency on video and service.
Q: Please quantify the growth of the company.
A: Video Guidance started with three individuals and big dreams. Today we employ 35 professionals, servicing hundreds of customers, with annual revenues of $12 million. We are proud to boast we have been a profitable company every year since inception.
Q: Who is your competition?
A: There are very few companies that do what we do. There are several reasons. First, Video Guidance is an independent, strategic video conferencing company, which allows us to represent the world’s top manufacturers. We provide a truly customized solution for our customers. Secondly, we offer an industry-unique cloud-based video service that our customers do not have to own, support or troubleshoot. [We] manage everything. And finally, we provide a user-adoption service that trains the trainer to make sure the users are comfortable, confident and capable. A typical audio/visual integrator tries to sell video conferencing as an add-on to a conference room. We sell video conferencing as a mission-critical communications tool.
Q: Is business travel your competition as well?
A: Back in the 1990s, we would always bash the airlines. That’s gone out of favor. Most companies don’t link video conferencing and airlines. They don’t travel as much. But they also want a return on investment on our technology and services. Today, we talk about training your workforce to use our video conferencing technology. We say it ‘‘gets you out the door faster and cheaper’’ or gets you ‘‘closer to your customers.’’ We don’t compare ourselves to the cost of air travel. But if rolled out properly … companies can spend less on air or car travel.
Q: Is Skype a competitor?
A: To some degree it is, because people use it at home and sometimes employees will ‘‘BYOD’’ — bring your own device — their iPads … and using these applications that are not secure or scalable and over nonsecure lines at work. That makes IT directors very nervous because … transmissions are going on about the company over free services. And that uses a lot of bandwidth. It can bog down other resources. Skype is a closed system. We do offer a gateway service that will bridge Skype and other systems. But we can offer a secure, business-quality video conference — not that choppy stuff on the screen — from a [customer’s] conference room starting at $29 per month.”
Q: Is industry consolidation starting?
A: For 20 years, the industry has grown dramatically. Video conferencing has revolutionized the way people connect. As a result, health care and educational institutions and companies of all sizes are making visual communications a strategic priority. And the explosion of new technologies is fueling new companies that create exciting new products. Today, because of the different ways we use this technology (from conference rooms to laptops to mobile devices), video is pervasive. I don’t see consolidation such as in the airline industry; instead I see just the opposite. Start-ups are making video easier to consume.
Q: Where would you like to be in five years?
A: I continue to be amazed at the unique and life-changing applications that can be realized with strategic business video conferencing. For example, we’re doing significant work with the University of Minnesota’s Amplatz Children’s Hospital, linking critical-care kids with their classrooms so they can continue to go to school and interact with students and teachers and with their families at night. A lot of these kids are from out of town. It’s an awesome, feel-good application.
There are a lot of brand-new-to-market companies that are addressing issues that haven’t been addressed. There have been spinoffs of new video conferencing companies by former employees of [equipment-makers] Cisco and Tandberg that have approached us and we’re helping bring the technologies to market.