I invite Sergey Kuznetsov onto YHP to share with us his expedition towards starting VCV.RU and in general, his entrepreneurial journey.
VCV.RU is an online service for the quality search of candidates through viewing their VideoCVs, helping employers reduce the number of interviews at least 5 times for each of the open vacancies, and in general, cut down twice the timing for hiring.
Hi Sergey, Thanks for doing this. How are you doing today?
Hi, thanks for this opportunity and your interest in vcv.ru. I am great, enthusiastic as always and ready to answer your questions and share my vision with YHP’s readers and young entrepreneurs.
Can you give us some background information about yourself?
Sure. I got interested in IT starting from the time I joined Hewlett Packard in Russia, where as a student I’ve got the job of evening technician. In HP I received a tremendous experience and after 5 years there was ready to open my own startup businesses in IT sphere. One of them, Norby was the developer of the first electronic trading platforms and SAP solutions for small and medium businesses. A few years later I successfully sold it and joined the team of Norilsk Nickel, the world's largest producer of nickel and palladium and one of the largest producers of platinum and copper, as the Deputy General Director. My passion for the IT was still inside me, and 3 years later I came up with an idea to create a telecommunication subsidiary of Norilsk Nickel. So I did it and became a shareholder and CEO. It was an operator of broadband and cable TV and that was also maintaining the service functions for industrial communications. Some years later, it was also successfully sold in 2008, and the company still works and shows steady growth.
I am always opened to new ideas and experience, so in 2008 I took the position of Deputy Director General of the Federal Housing Development Fund. It is a very large and important State Corporation, whose main objective is to promote the improvement of housing and infrastructure development in regions of Russia, imagine the scale? After 3 years of a public service I went back to business. After this experience I decided to concentrate my skills and passion in investments. Presently I am a senior vice president in Fleming Partners and investor and main shareholder in VCV.RU, Russia’s first videoCV service.
Tell me how you initially got into business?
I got passionate about business while studying in the Moscow State Aviation Institute where I graduated. So when I got some experience in corporations, I continued my business education at the Finance Academy under the Government of the Russian Federation in the specialty "Banking and Insurance", and I’ve got an MBA from the Chicago School of Business. In Russia the argument pro the business education is often questioned if one has already got an interesting work. I personally believe – learning is essential! It is one thing when I comprehend the wisdom of the profession and the management of the company based on my own experience, and quite another - when I can rely on the knowledge and practice derived from the best universities in the world. Plus, education provokes a helicopter view, I understood how business works in a global sense, but not at the level of one company, and I started to love it. That’s why I enjoy both doing my own projects, and working in big corporations, Russian and international.
How did the idea for VCV come about?
It's simple - the idea was born from the need. When I worked in the Federal fund, my colleagues and I were constantly experiencing personnel deficit that is normal for every state organization. I often had interviews with job candidates. These meetings often seemed like an absolute waste of time. If the candidate clearly did not suit us based on the first impression, I still had to hold the meeting. I began to think about how to optimize the process of hiring employees. Once I talked to my friends about this idea, and one of them recommended me to look at young entrepreneurs with a very interesting idea in online recruitment. I met Nikolai Volchkov and Ilya Lazuchenkov, six months later we did a prototype of video-CV service.
Tell me about the early days, what was the hardest part of starting the business?
Before we started VCV.RU, none of the guys in the project team was engaged into a purely HR business, but were forced to deal with the recruitment and staffing industry. Therefore, at the initial stage, we have done a lot in terms of expanding our competencies in HR. We carefully studied the market, held numerous consultations with the experts who reviewed all available studies of authoritative organizations, attended industry conferences. I helped the guys to adapt themselves to a new sector.
During the process of elaboration of the project business model I was guiding them. Now I am sure that all the brainstorming was useful for all of us, we created an efficient business model, tested the project in some Russian regions, market and successfully run it on the federal level. From the very beginning we evaluated the obstacles we may face, the key services, and the growth points. Everyone brought in something new out of his areas of expertise.
What is VCV? And what are you trying to solve with it?
VCV.RU is an online service for the quality search of candidates through viewing their VideoCVs. We help employers to reduce the number of interviews at least in 5 times for each of the open vacancies, and in general, cut down twice the timing for hiring.
Traditional job search resources, social networks, and other communities of professionals allow accessing a large database of candidates with text CVs. The use of these sources let recruiters in HR department of the company or the agency solve problems in the stage of initial search for candidates. Further, the recruiters hold a series of personal interviews, and the big part of these meetings are not useless. This traditional business process leads to high financial costs and / or time spending for the end employers. VCV helps the HR specialists safe their time and get the VideoCV of the candidate and meet only with the candidates that suits the vacancy.
What sorts of advice do you having for entrepreneurs looking to raise money for their startups?
I would break my advice into two parts. First part refers to general rules. Firstly, before you ask for money, you should be absolutely clear about what your idea is, how it appeals to the end customer and the market, and why it is necessary to invest into it. Secondly, you should have an excellent presentation of the project, otherwise no one will be spending hours on the analysis of notes and diagrams - investors are very busy and their time is very expensive. Be short and bright. They will not look for a needle in a haystack, it is up to you – how adequately you lead them to this needle.
Thirdly, have a competent business plan. Investors want to know when and what will be the return as well as see the roadmap to success. Well, fourthly, if you believe in your idea, don’t be afraid of failures and closed doors. If you faced one closed door, be sure to knock on to the next, use the social networks to meet the investors and contact them.
The second part of recommendations refers to the "sales" activities in the project. Firstly, constantly review your results and activities of similar startups, make conclusions about which methods are not working, adjust your strategy. Secondly, make a preliminary list of investors, arrange them by the priority according to their potential interest in your project, then start sending presentation of the project, collect feedback from the first meetings and use this experience to adjust further actions. Thirdly, attend industry events, build communication with market experts (opinion leaders), media, potential partners.
About the first few months, how excited were you, tell us about how those months felt, what happened?
Of course, when the project that I invested in the stage of the paper description got into the working business, I had a special feeling. In the beginning I’ve rather had curiosity – will it work or not? It happened to me when we launched the first version of VCV.RU in Krasnoyarsk, one of the major regional centers in Russia. But later, when the project launched in the federal market with the first customers and the media asking for an interview, it became clear - I made the right choice for investment.
How did you initially get traction?
Project founders invested into the project on their own, I became the main investor, as well as during the launch we had the support of other private investors, businessmen, interested in VCV.RU. This funding was enough to launch a complex project.
What are the most crucial things that you have done to grow your business?
The team of the project operates the standard procedure known to all startups as the «test everything in small case». This means that you need to test the model on at least one client and start scaling. We have gone this way very well and received positive feedback from several clients and market experts. Now we are in the growth stage.
What should we be expecting from yourself and the VCV team for 2013?
This is a year of big plans and big expectations from the team. In the next couple of years, the business will only grow, and by the end of 2013 we have to reach the payback time. By the end of 2015 the service should become an essential tool for the qualitative selection of candidates for employers, it will become the market leader in the field of multimedia technology in recruiting and video-CV services. We want VCV to become a brand, and all the applicants to present a professional profile with VCV (VideoCV), and the procedure for preliminary interviews via VCV.RU would become normal. Plus, we are considering plans to enter other markets, and we are confident about these plans.
What three pieces of advice would you offer entrepreneurs starting out today?
I think that it is really essential as a first step to get a good analysis or understanding of the market where you are planning to work and compete. Test your idea among your friends and acquaintances, partners and potential partners, ask their views, discuss it with your team. I am convinced that brainstorming and discussions are best way to find the right solution.
Then it is important to concentrate your attention and ideas on the product, what are the key competitive advantages and exclusivity; afterwards you need to ask yourself about monetization and financial model. And of course, one of the key indicators for your success is the team and your partners.
Lastly, what would you say has been the highlight of your entrepreneurial journey so far?
I have experience in development and selling the companies, experience in working in public organization and this helps to identify and understand the issues on the state or macro economy level or global scale. I am really happy to share my expertise and knowledge with young teams, participate and be involved in the development of absolutely new and innovative service. The highlight is always – the moment when your project/startup becomes a company or a business. When you get interest from potential investors, when you come to the meeting and people know about your business, or they say I read about this story and it is really great!