Vyachaslau Shkadarevich about QuiDox.by entering the market and the ambitions in EDI providing

How Kartoteka CEO and the founder of QuiDox.by heroically fought through bureaucratic obstacles, removed the headache of officials, and now is going to make life easier for B2B

Vyachaslau Shkadarevich cut the niche for his IT business in Belarus all by himself. 4 years after the launch of Kartoteka.by, the company had several newborn competitors (including 1 state-owned). However, the service continues to hold the position of the absolute leader — about 80% of all requests in the segment of verifying and monitoring counterparties.

Now CEO and co-founder of Kartoteka, together with partners in Russia, Ukraine and Kazakhstan, is actively developing a new product in the “breaking the system” style. The novelty is designed to simplify the B2B processes in Belarus.

Our July hero Vyacheslav Shkadarevich about QuiDox.by entering the market and the ambitions in EDI providing.

The idea of creating a service to verify counterparties is not new to the global market. But 7 years ago, many people played at the temple when they heard that it could be implemented in Belarus.

“The Man Who Breaks the System”

Some stakeholders call me that. But I am Aries. When I run into a wall, I get excited about how to get around it. Or maybe the whole thing is in the Greco-Roman wrestling, which I was fond of as a kid? There, if your weight didn’t allow you to escape into a smaller category, you step on the mat as David against Goliath — and must struggle to win.

In 2012, Kartoteka was tested offline, and we started discussing the database with officials. In response, there was a combination of facial expressions and words like “you’re a private company, who will allow you?”.

But I really believed in the idea. We looked at the European and Russian experience (Kommersant Kartoteka, SKB Kontur, SPARK Interfax). We had personal meetings and telephone conversations. Almost no one believed, even among the CIS operators, that something could be done in Belarus.

But the main negotiations in various offices began in 2014, and then we saw that the mindsets have changed in two years.

The officials understood that if we applied our solution in construction, wholesale, or in any other industry, it would remove a lot of headache for them. Each market player would become more sustainable, pay taxes and social security, and wouldn’t cut staff and get into unfavorable situations.

When Did the Investors Come?

There was an agreement that we would sign the contract with the investors obliging them to buy us right after we make the product and launch it online. But it was 2014 with its crisis and sanctions (the investor was from Russia), and a couple of months before we were ready to sign, they said they were sorry and left the agreement.

A lot of resources were spent — time, money and effort. Almost $30K of accumulated debt. My beard turned grey in a week. I did everything I could, and it seemed that the finishing tape was right in front of me…

My first companions stoically lived this moment through. But they weren’t ready to start over. I took the risk. Within a month, my companion pool changed completely, and we started to make the new product from scratch.

The preparation for the first launch took us 2.5 years, but in the new situation, with a completely rewritten code and rebuilt internal processes, 4 months were enough for us. We went online at the end of December 2015.

This summer, the service of “Verification of the reliability and business reputation of counterparties” was launched on the state portal.gov.by

Such trends are not new in state organizations, if you look at our western neighbors, Baltic neighbors, and Ukraine (where quite a little time has passed, but huge arrays of state databases became open). In these countries, the role of services like Kartoteka is reduced to systematization and usability enhancement, to additional analytics, to building comparisons and demonstrating connections between databases.

In Belarus, the state market player will be confronted with the same mass of bureaucracy and misunderstandings on the part of the same government agencies that Kartoteka had to face before. But, in general, it will contribute to the development of the market.

How Does Kartoteka Earn Money?

First of all, it’s the web service with a subscriber access model for 3-6-12 months.

And the second way is outsourced analytics. These are one-time services when a client’s need arises.

Of course, you can enter the foreign market to hang yourself a medal. But cold economic calculation holds back. The company has external customers in Europe, Canada, USA, in the near-abroad countries, for which we supply data. But buying 0,01% of the market for a 7-digit, even a 6-digit figure, unfortunately, that’s not for Belarusian companies.

At the beginning of the journey, our business goal was to pay off the investments by the 18th month. On the 5th month, we had a fair 0 in operating expenses. Since then, there hasn’t been a single period with a negative indicator. According to one of the representatives of the state regulator, Kartoteka retains about 80% in the aggregate of traffic on requests for such services. And this is a stable share.

QuiDox.by — Will Business Forget About Traditional Mail? Not Yet

I hate the time from the 1st to the 5th day of each month, because I lose 2 working days doing mechanical tasks: print, sign an autograph, attach a seal, and make sure that the staff deliver 1000 envelopes, so that the accounting statements, acts, and other reporting documents for our customers and government agencies were sent in time. It’s the 21st century, for crying out loud!

Those custom solutions that already existed on the market were expensive, $3-15K, and were developed for a specific client. At the same time, everyone in B2B sends documents by mail back and forth. We needed a universal and cheap solution.

It all started with a simple (and terrible) engineering version that was born at the Legal-Tech hackathon at the end of last year. As a partner of the event, I was supposed to be there all 48 hours. What to do? I found a development team there that was fascinated by the idea.

After 2 days, we presented a solution and even received a diploma. The version was raw, but most importantly — it allowed to:

a) register, b) enter the addressee’s e-mail, c) attach an electronically signed document.

As a result, your partner or client is guaranteed to receive the document in seconds. And most importantly — on the basis of software certified in Belarus.

What Stage Is QuiDox.by In Today?

It’s in the stage of active growth of the product, not distribution yet.

The 2nd working version of the product is now online; it’s web-based for now. We plan to release the 3rd version in August. It will be an App interface adapted for medium and large businesses. It will have the architecture for interaction with an interdepartmental workflow system in the future.

We are also actively interested in the cross-border exchange of e-documents. First of all, with EEC countries and Ukraine. But even now about 60 companies already use the services of QuiDox.by.

The team has a clear road map for product development, but we are flexible. Over the past 3 weeks, the order of programming and architecture changes occurred twice. And no one knows what will happen in six months. Maybe a sub-law act will emerge, which will regulate the use of e-documents or e-signature? We will immediately respond.

Do Kartoteka and QuiDox Have Different Teams and Stakeholders?

Such a decision was made to avoid dispersing the processes inside Kartoteka. We try to minimize the load by attracting outsourcing partners. I know examples when companies collapsed due to high internal costs.

There is a separate office for Kartoteka’s call center, all developers are working remotely, but the team responsible for product promotion and development is nearby. I prefer the notes of a madman on the blackboard and face-to-face discussions.

What’s Next?

In April, we organized a round table at QuiDox, which brought together business representatives, government officials, lawyers, but also key players of EDI services (note — Electronic Data Interchange). We could see that this area had a completely different scale of document flow. And this can be a good business story for us. We understand our uniqueness, which will allow us to enter this market. But it makes no sense to disclose it now.

Motivation

The main thing is that you must continue dreaming. As soon as you have ceased to dream — you can go to work as a corporate employee. From 9 to 6, with a break for lunch.

Those are happy who bring global benefits — for the private business or the public sector, the family or a specific person, and at the same time have an income.

But the income doesn’t come immediately. You can even turn grey by that time :)

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