Today I’d like to share the story of a Newcastle startup that has been flying under the radar for some time. A local Newcastle startup that has customers internationally. That startup is Coassemble and its co-founder, Ryan MacPherson.

Ryan: Hi, I’m Ryan McPherson, co-founder and CEO at Coassemble a Newcastle startup revolutionising the online training game for small to medium businesses.

Adam: But first I’d like to tell you about another organisation that is helping startups succeed in our region.

The City of Newcastle is a big supporter of entrepreneurship in our region and has recently launched a brand new digital hub called Newihub. Newihub is a growing and vibrant community of Newcastle’s startups & founders. It’s a central hub where you can learn about what’s going on in our ecosystem, with events, available jobs and other resources. 

Coassemble is a service that helps businesses create their own interactive online courses which can be used to educate their teams or their customers. They are a global company with staff in Denver, Wisconsin, LA, Canada, and Newcastle. They are backed by venture capital, and their latest series A raise was four and a half million dollars. So how did Ryan go from being a PE teacher to CEO of a   global, multi-million dollar company overseeing thirty plus staff? To answer that question, first, we need to go back to day one and hear the story of how a policy of the Kevin Rudd government would dramatically alter the course of Ryan’s career.

Ryan: So I guess I come out of uni and I’m targeted as a targeted teacher to Mt Druitt which is an interesting area to teach in and I absolutely loved it. I spent six years there probably forming why I can be probably who I am today.

Absolutely loved the experience, but Kevin Rudd actually drops a laptop in everyone’s hands as a kid essentially in about 2007. … there is no way in hell that teachers were prepared to teach with technology. I was kind of a bit of a young guy and up and coming to think I could tackle the world.

I literally just started playing with some of the best ed-tech tools back then, were- who are now the tools that we kind of look up to, you know, Prezi, Edmodo, even Google Classroom before it’s actually become a really true synonymous education tool. I started playing with those tools and could see the power straight away of engaging a cohort of kids or, you know, learners in technology.

It just made a massive difference in the classroom. So I focused on that, started educating other teachers. I guess I found a bit of a calling there where, you know, I was able to impart good ideas, also get into the tech quite quickly and understand how it could benefit, merge the two in an expla-, like an explanation to teachers and say, Hey, if you were thinking about using this tool, you know, you don’t need to use it every day, but maybe you bring it on Wednesday and you use this technology to drive the idea further. Right. And I guess I got a passion for that. 

Adam: Ryan’s experiences in the classroom in the mid two thousands help him see the potential of technology to revolutionise the way people learn. After years of working as a PE teacher, he leaves to pursue a career in the E-learning space.

Ryan: And then that kind of led me to work with a digital agency at some point in my career, where, you know, I was lucky enough to work with the ABC, Commonwealth Bank, you know, Fitness First on some of these educational, revolutionary ideas in the workplace, you know, to move education through the business. Right. And think about technology in a way that could do that. Right. And they were expensive projects and they were exciting. We were using things like beacons. When you walked past a water cooler and your mobile phone would pop up and tell you to have more water. You know, it was really innovative, exciting stuff…

Adam: Ryan is able to build his experience and credentials in the E-learning space working in various roles, including a stint as Head of Innovations at the Department of Education. In 2015 he and his wife move from Sydney to Newcastle, and with this change, Ryan looks to make another: to take his passion for combining technology and education and build a business. 

Ryan: I was looking for the first time to probably launch myself into a business and I didn’t really know what it was going to be like, to be honest, but I felt like I had enough experience in the technology education space to be able to either sell something, build an idea around something, but I’m not technical.

Right. So, you know, there’s no way I could produce the software. And I was lucky enough in 2015 to kind of run across this company called Futura group, which was run by a guy called Reinhold who’s still, you know, a massive part of the business on the board today. 

Adam: Ryan starts working for Futura Group, a company providing digital education resources, and meets two people who would be key to the future of Coassemble; Reinhold Forster, CEO of Futura Group, and Jude Novak, a talented developer who had all the technical skills that Ryan lacked.

Ryan: What I love about Reinhold, he had this vision of truly investing in the technology, you know, not thinking always about the profit first and saying, Hey jude build what you think is amazing.

And then Jude had this amazing capability to actually do that. 

When I met Jude who designed some of the best apps on the app store growing fast, he had this fun, colourful way of bringing technology to education that I hadn’t seen before. I thought it was really cool.

Adam: Having worked in the E-learning space, Ryan felt that this fun and colourful way of using technology to educate had enormous potential to reach a large audience, given the resources that were available at the time weren’t always super compelling.

Ryan: I think if you look at the online training space or e-learning space it’s kind of like websites probably 10, 10, 12 years ago. So there’s a lot of what I would call large cumbersome platforms that are kind of put in the hands of, you know, agile team members and there’s just not a good product fit for what they’re trying to achieve in their business.

And so we felt like there was an opportunity to really kind of, I guess, revolutionize the content creation piece of that for team members. So they’re not stuck with clunky old school technology

Adam: Futura Group had developed a tool called E-Coach, which was being used internally to create educational content which they would then sell to Tafes, Registered Training Organisations and Universities. When Ryan joined the team, he saw the enormous untapped potential for E-Coach, which had made the creation of educational courses much more efficient.

Ryan: They’d taken, know, what was almost a year’s worth of work to create these 400 assets, right. And they included heavy content, deep knowledge around cookery and, you know, barista skills and all these sorts of, you know, tourism skills that they would then sell on to those students who were training in those spaces.

They’d taken this, they used to create it; Jude talks about this all the time; they used to create asset files for every single screen. And then, you know, design that and then put that into a course and then roll that out. And Jude had created this tool with some of our early developers and engineers that revolutionized that into like, you know, six months.

Adam: Seeing the remarkable efficiency of E-Coach, Ryan believed that rather than selling the content, E-Coach itself should become the product. Ryan is able to convince Jude, Reinhold and others at Futura Group to make E-Coach its own separate entity, and transition it into a SAAS, or software as service. 

And I guess that was an important part where we described earlier that this had to be its own brand. It had to be its own entity. …

Ryan: So we, in 2016, we launched in beta. We get a lot of good traction off the back of the way we’re coming out of an existing business. So there’s a lot of structures there to allow us to get to really quick customer traction. …

Adam: E-Coach launches as its own entity, and due to having been developed within Futura Group for years, the product, now being sold as a service, is able to get traction quickly. They start by targeting Australian customers, but soon they receive interest from the US. Ryan credits a significant part of their success to the decision to implement live chat on their website, using a service called Intercom.

Ryan: If you’re not familiar with Intercom, it’s a live chat tool that we implemented back in 2016, we’re early on the board for live chat to our customers. And it’s actually driven probably a lot of our success. We talked to our customers over 400 tickets a day, you know, it’s a massive part of our engine, if that makes sense and we’ve continued it, but this tool allowed us to start talking to website visitors. And so I’m the, you know, we’ve got two developers and Jude essentially at this point in time.

And I’m the person that’s meant to commercialize and sell it. So I just started talking to people, arriving on the website, you know, Hey, where, I’m from Arkansas … And we were writing all these articles that were getting kind of great SEO juice back then, it was a little easier. Google was a little nicer back then than what they are today, but basically, I started talking to these customers and we ended up signing UMKC so the university of Kansas, Missouri purely through live chat on the website and a $5,000 deal. And you know, at that point in time, I’m like, Man, we didn’t even get on a plane. Like, I did this from Coles and I’ll never forget it. I was actually at Coles in the Junction. And you know, my wife’s there going, Hey, Ryan, go get some bananas or something. I’m trying to live chat with this customer. And it’s like popping up that it’s UMKC, and I’m like, it’s the university of Kansas shit! I’ve got to get on this. So I remember standing in Coles for like 15 minutes and my wife just coming and slapping me on the back of the head and going what are you doing? You know, like, you’ve got to get the bananas or whatever it was we were purchasing at the time. So. Yeah, it’s interesting that kind of led our US I guess instincts that we were onto something and those guys are still customers today.

Signed them off a 45-minute live chat at Coles at the junction.

You know, a lot of people, I think when they talk about SAS or they talk about startups, they’re like, cool; make sure you, you grow first in Australia, and then you tackle another market, you know, you don’t want to go to another market without, you know, nailing your home first

I kinda thought that was rubbish. So. In my mind, our market wasn’t yet mature enough here in Australia to actually understand what we had. And I thought the US was, it was already there. So we actually saw so much organic growth in 2017 coming out of the US that we said, no, let’s go there first.

And this leads into the name change. … But basically, we go to the US and we find out about this company called E-Coach. And we were named E-Coach at the time and hilariously I mean they’re a small company backed by the NFL. So literally it’s a coaching app that allows you to coach golf, tennis, and they’ve got NFL players on their website and they’ve trademarked essentially the name E-Coach.

So we want to go to the US, we definitely want to kind of tackle this market, but we don’t have a name that can actually do that legally or whatever. We never thought about that. So opens up the trademarking discussions, legal discussions, and me and Jude actually driving down the freeway … we spent two and a half hours talking about what name we should- we should have for Coassemble thinking that, you know, us two geniuses will just come up with a name. And we come up with ‘Stick’ and all sorts of other crazy, terrible names. But in the end, we went to a local company and actually, Scott who worked at that company shorthand you know, kind of helped us come up with the brand and the name around assemble which is what we first started with.

And the idea was we help people assemble content. But they then share with their teams. So it made a lot of sense. And then we went for that one and that was also taken. So, you know, the lawyer in the US, actually, I’m on a call and I’m actually in LA at the time and I’m there trying to think about this naming and where they go, Oh man, we’ve hit another brick wall.

And the lawyer goes, well, you know, you could put something in front of it right. And he goes, you know, like co and we’re like shit. That’s not bad. And a Coassemble is born essentially.

Thanks to the lawyer. I don’t remember his name, but I’m sure we paid him heftily for it.

So Coassemble is born, and thanks to their origins in Futura Group, Coassemble is able to get a running start, attracting clients from both within Australia and Overseas. But they quickly decide that to grow at the pace they envisage, they’ll need to seek investment.

We come out of a business that was bootstrapped by the original owner; cash from the original business was used to form that initial part of the company.

And we’re very thankful for that start because that’s what really allows us to kind of take E-Coach back then out of the company and do what we’re doing today. We then kind of look for our seed round, right. And they call it a seed round cause I assume that they’re planting the first seed or something like that. I’m sure there’s a great analogy for it. But really at that stage, and I talked to the team about this a lot,  they’re really only investing in an idea. I mean, you’ve got very little traction on the table and you might think you’re a mature business. You’ve got five people in there doing great jobs, but you’re not really.

And they’re really thinking. Does this idea or this market or this product, or whatever, have the potential to be a serious player one day. And they’re taking a massive gamble on that, and you’ve really got to convince them on one thing that you have a vision and you know how to execute on it.

Adam: Coassemble is successful in securing investment, and continue to grow. At this point, Ryan has gone from P.E teacher to CEO of a venture capital-backed company that, right out of the gate, is a global operation providing services in the US and Australia. It was a big transition to make, and the journey wasn’t without its turbulence. 

So I guess Jude and me like early days, you know, he’d probably say that now that I was a good guy and he likes me. But I think at the time he probably thought, who is this kind of PE teacher coming in to commercialize this product. He’s got no experience, like what the hell is happening here. So I think if you had to really get Jude, you know, to answer that question and deeply push on him, he’d probably be like, yeah, I didn’t really like the dude that much when we first started now, I think, you know, me and Jude have proven that there’s a really nice balance between having someone that’s super passionate and talented and skilled on the product side. And me not wanting to play with that. Actually wanting to foster it, to allow it to grow and then me focusing heavily on how I can build a team to probably commercialize this product and take it to market. So when you have that combo, yeah, it’s a nice combo. 

You know, I think at the end of the day if you’re familiar with running a company any shape, size, cafe; right through to, you know, Westpac, … I think there’s always this responsibility, the way that I see it, at least anyway, I’ve got a responsibility to the team. At the end of the day, … they’re actually the ones that are delivering the experiences to our customers. …

And so. The one time when you get really nervous, especially as a startup who’s investor-led, you know, and growth is really the only thing that you can really report back on. Right? You’re not here to necessarily talk profit at this point in time. We’re really about where’s the growth, where are we going?

What’s the direction at the end of the day? I have two jobs. I have the ability and a necessary need to raise money. Like we are investor-led. We need people to invest in our vision and that’s part of my job, but the second is just to allow our team to have the opportunity to grow.

And so when you have those moments of like, Oh, can I do this? Maybe, Like, I’m just a PE teacher, what the hell am I doing? Cause I had those moments a lot, you know, where’s my whistle? I should be back on the top oval, you know, basically, I think there are these moments that you kind of reflect and you say; at the end of the day, what would I be doing? I’d be letting the team down. And I think if you’ve got that approach to, you know, shareholders matter, yes, Hey guys, you matter. But at the end of the day the team and what they’re actually doing for our customers and the opportunities they have to grow, you know, some of our team members have grown from, you know, three years, four years in the business to now be heads of the business. … that opportunity is probably what you don’t want to give up on. … Fires are everywhere in every startup because you’re always under-resourced for what you meant to achieve. Yeah. You just gotta ask yourself, what is it, what are we really doing this for, at the end of the day?

For me, it’s the team. If they’ve got great opportunities, then I think we’re doing something amazing. And so I think we see good culture out of that. And we see a lot of opportunities for our team members.

Adam: With a great team with technical skills delivering the product, and Ryan at the helm as CEO, Coassemble has grown rapidly in just a few short years, to a staff of over thirty employees.

Ryan: We now have almost 15 people in customer support. Right? It’s something you have to scale. You have to invest in it. It’s not something that comes for free. I’m not at Coles anymore doing 400 tickets a week. Right. So. There was a time where I was still at Coles and you know, I’d go out to dinner with the Mrs. And she’d be like, put the goddamn phone down. But the point is I guess if you’re going to invest in your strategy, then it probably pays off in a metric at some point in time.

So we invested in talking to our customers. It’s my true belief that that pays off in retention. 

We have one of the highest five-star ratings on review sites for our customer support. We focus heavily on ensuring the heart of the customer is at everything we do…

And I think our strongest stat is a 99% retention rate. People don’t leave us.

Adam: Today, people who join the Coassemble team are trained in part by courses made using the Coassemble service, but it hasn’t always been that way.

So it’s a hilarious story that I probably shouldn’t share on a podcast, but yeah, for the first three years we don’t use our own product.

Well, we’re an LMS, we’re an online training tool. We’ve got this amazing content creation tool and we’re still using Google docs. Now why that is, I’m not a hundred percent sure because we had the technology for free right in our house…

There’s almost this threshold where. Formal kinds of educational pieces online make sense to the business. And Jude and me have talked about it, right when we’re six people and me and Jude like we were doing our absolute best. I mean, at the end of the day, you’re talking about a PE teacher and a guy that’s designed apps, running a company. Right. What do we know really about using an LMS from an HR perspective? If that makes sense. So. Not much, you know, so we use our traditional methods, you know, meetings, me talking to people. And then all of a sudden, you know, we get a bigger team we’re now 30 and hilariously Dimity in our ops team says, you know, like, it’d be interesting if we used our tool, Hey, you know, and signs up.

Literally signs up, goes through the process and says, wow, I found a few problems for us in terms of, you know, it took me too long to create it. And I found this issue here and … 

And they come back and go. Yeah. So guys about this button here, it doesn’t work. It doesn’t work. Sometimes when your customers are telling it, you’re like yeah yeah yeah but you guys, you know? Yeah. You just, you don’t know exactly what’s going on. When an internal team member is sitting there going no, you missed it. You know, it’s so much more powerful to have that.

So I think that was a good experience. Yeah. 

Adam: Sixty percent of Coassemble’s business is now from the US, and Ryan has spent lots of time overseas during the growth of the company, which gives him an interesting perspective on Newcastle and the opportunities it holds for aspiring entrepreneurs.

So, you know, I’ve worked in Sydney for 12 years. I’ve worked in, as I said, I spent six months in San Fran and six months in Austin. We’ve got an office in Denver. I’ve spent almost a year there, you know, Newy is this perfect balance of like, have the lifestyle you really are looking for, enjoy that kind of cultural experience plus good food plus activities, we’re very active. Right. But do so in a way where your business is not going to sting you for your rent, you know, I know that we pay about 5k right per month in Denver, for example, we pay, you know, around eight, for example, for half the space. And so, first is financial, right, Newy is a great place to find great spaces that are financially viable for starting a business when you don’t have much cash. Right. And today we pay five, but I first got our office at one, you know, and it was the stairs to hell. It was pretty scary heading up the stairs to this place. But you know, you have lots of great opportunities in Newcastle to think about. Team having balance in their life. You know, we have a fully flexible working arrangement. They come and go. If Jude, for example, he’s a surfer wants to go down to Cowrie hole, he can do so. Newcastle presents this unique balance of lifestyle and talent and passion. I think we’ve got that in spades. 

And I think there’s a real opportunity for Newcastle to be seen as a place that can not just innovate but build things that go global. And I think when you go global, that brings a lot of people to your city. Thinking about the opportunities that exist in a global business. So for me, startups allow global thinking from day one, because if you don’t have that, then to be honest, maybe it’s not big enough. So I think startups generally think that way, so that entices people to come in on a big journey. And I think that helps the city kind of grow its experience, talent and yeah its the environment. 

Adam: I finished my interview with Ryan by asking him if he had any advice for founders.

Ryan: There are three things that I’ve lived by. Right. And I’m happy to share them now. They aren’t wise. Let’s just be honest, but I think they’re kind of cool. The first thing is. Always hire people smarter and better than you, you know, I absolutely have that belief that surrounds yourself with people that can do a better job than you can and learn how to cultivate them rather than necessarily you know, manage them. And that’s a massive part of how I think we’ve grown this business, which is hiring talent, letting them be free, but giving them the strategy that allows them to run in one direction. The second thing is like, I think; believe in your vision and mission, you got to have something you’re driving towards, otherwise, this is a 20 hour and a 24 hour a day job.

And I don’t mean that I’m sitting behind a computer for that long, but you think it, live it, breathe it, you know, you, you never leave it. Right. It’s like that girlfriend, you can’t get rid of. So essentially I think, you know, There’s a part of making sure that you are committed to that because your team absolutely requires that that’s vital that they have that commitment from you that you’re going to go out there and do that.

So they have that opportunity. And the third thing is just make it fun. This is a stressful enough job as it is, you know? So if you aren’t coming to work with a smile on your face, then your team is in the trenches. They’re not, you know, they’re not in a  business that’s stable, they’re not in a  business that’s giving them the best perks in the world.

Adam: Thanks for listening to the story of Coassemble and a huge thanks to Ryan McPherson for taking the time to speak with me.

Next week on Welcome to Day One we have a brand new founder story to share with you with Colin Goudie from Social Pinpoint.

These incredible founder stories are made possible by our supporters. We can’t do it without them, and I’m just incredibly grateful for their commitment to our local startup community and in helping us spotlight these amazing founders who inspire me and I hope who inspire you too. 

The City of Newcastle’s Newihub is our major sponsor and I’d just like to take a second to express my gratitude for their support. Newihub is a great new initiative from the team at the City of Newcastle. It’s an online community to keep up to date with what’s happening in our region from an innovation perspective and a hub of great resources. I encourage you to check it out and sign up to be a member. 

You can learn more by clicking the link in today’s episode notes at welcometodayone.com or by going to newihub.com. 

This episode was produced by me, Adam Spencer, with scripting and audio editing by Andy Jones.

Information about everything mentioned in this episode can be found on the show notes page at welcome to day one dot com.

Music by Lee Rosevere, full attribution on the welcome to day one website.

If you’d like to support this show, please consider leaving us a review or supporting us on Patreon.

I’m Adam Spencer, thanks for listening.

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