Sven Hecker had a slightly different route into founding a software startup. The German first worked on a company called derTaler that sold memorial medals, coins, and badges to the German military.
Like most businesses, he wanted to expand and sell into more markets, ideally the UK. He and his cofounders hit a roadblock, the British army would only purchase from British-based companies.
“We need to have a company in the UK so we’re perceived to be English,” said Hecker, who figured there must be a way but the small company, like many others, didn’t have the budgets for establishing a separate office and staff in the UK.
Instead the company had to turn to a variety of services and workarounds. It bought a “virtual office” in London and then separately started a Ltd. company. Next the founders had to physically fly to London to open their bank account. To add to the pile of bureaucracy, the founders then set up a prefix landline in London for phone support.
Needless to say the costs and hassle were exasperating, possibly even off-putting for other entrepreneurs.
“Based on these problems, there must be many, many more small-medium sized enterprise companies that struggle with the same type of problem,” explained Hecker. And these headaches were just in the UK. Would they need to go through the same rigmarole in France or Spain or Italy? And how much would that cost?
The challenge bred opportunity in the minds of Hecker and Christian Hemmrich, who would go on to form Clevver, a platform for booking virtual office services in other countries.
It has what sounds like a straightforward goal – helping make businesses go global digitally – but it’s still ambitious.
Having raised a six-figure sum of money from angel investors recently, it is now running around 10,000 post boxes. Clevver’s software allows entrepreneurs to manage activity on their addresses, create an entity that will receive revenue and pay taxes in that country, and order the forwarding of mail and shipments to their chief address.
“We work together with partners all around the world, partners that already have a location in these countries,” said Hecker. It’s currently operating its service in 38 countries, mostly in capital cities or main business hubs, its most popular options are London, Berlin, New York, Washington, Hong Kong, and Shanghai.
Long term, Clevver wants to be a one-stop shop beyond the basic virtual mail box to include company incorporation (Ltd. in the UK, GmbH in Germany, or a Delaware-based company in the States), VoIP telephone, and translation services. Currently, Clevver’s business model is subscription-based.
“You pay to use the address per month. There are different types of subscription because there are different types of customers that use us. If you’re a freelancer, because you’re travelling all around the world, you’re working from the beach in the best case, you need to have some kind of stable address where you can be reached and where you can receive mail.”
This ranges from a basic €6 account to business-centric accounts at €59. Clevver would not disclose any revenue figures.
There are plenty of competitors in the space, offering these services in various forms. Payments firm Stripe, most notably, provides a service for startups to quickly register a company in Delaware.
“There are so many companies that do one of these services. There is competition in the area of postal mail digitisation, there is a lot of local competition if you need a local virtual business address but they don’t offer an international approach. That’s where we differ from the competition,” said Hecker.
“There are a lot of local and single service competition but there is no brand that is actually working on the approach with a one-stop shop.”
Virtual mail boxes and online company registrations are likely to become a hot topic soon, especially for UK companies in the preparation for that great big albatross overhead called Brexit.
“We’re looking into this to see what is the impact on our company because in the end there are a lot of talks and nobody really knows what’s going to happen afterwards. I believe there will be more people entering the market and they have to have some kind of entity,” explained Hecker. “When we launched company incorporation in the most relevant markets, there were also a lot of English companies that have to have a local entity and they could be using our software.”
The most activity that Clevver sees is from companies in the UK, Germany, and the US seeking to establish presences in each other’s countries. However it’s also seeing a lot of firms from emerging markets like Brazil and India looking to create entities in Europe and North America. China, unsurprisingly, is a big market too with options for registering in Shanghai and Hong Kong.
Fresh off its latest fund raising, Heck and the team are now looking to the future.
“We’ll invest first of all in marketing because we have to attract more and more customers and as it is an international approach, there’s a lot of marketing into the whole wide world so we have to attract people from Brazil that want to enter the German market,” said Hecker.
“Of course, we see ourselves as a software company and our customers are asking for more and more products on our platform.”
Later this year, it plans to raise a Series A round of €3-4 million.