When former hockey player and luggage e-commerce entrepreneur John Nordmark was recruited as a board member for an Eastern European accelerator, he had little idea that the journey would lead to the development of an AI-powered, innovation software ecosystem and digital transformation accelerator for large enterprises called Iterate.ai.
Nordmark, CEO of the company, cofounded the business with fellow board member and now CTO Brian Sathianathan in 2013. “The way we got started was my cofounder Brian and I were invited to join the board of a Ukrainian based accelerator, kind of like a Techstars of Eastern Europe. It was funded by the second wealthiest person in the Ukraine, who wanted young entrepreneurs in Eastern Europe to learn how Western entrepreneurs operate, how to start a company like you would in Silicon Valley,” says Nordmark.
Of the 400 or so companies that came through the Kiev, Ukraine-based program every six months, 10 were chosen by the board to proceed through the accelerator program. Nordmark and Sathainathan would then spend time with them teaching them how to create an investor presentation, hone their go-to-market strategies and how to raise money.
“This was really the beginning of Iterate because we’d see these amazingly smart people from Moscow, Kazakhstan, Moldova and Belarus trying to build these really technical capabilities. They were living at home. They might have been 30 years old. But the thing that kind of struck us was that 36% of people in Ukraine go to school for a technical degree versus 6% in America. They have highly technical people and they have a love for this, but the governments there are just so oppressive. We are looking at these young people thinking if they grew up in New York, Denver or San Francisco, they’d have amazing jobs. But they couldn’t even afford to move out of their parents’ homes. Brian and I were like, ‘Oh my gosh, the world is flat.’ The world has changed from capital being a barrier to entry for a start-up to brains. And smart people can be found everywhere around the world,” says Nordmark.
That gave the pair the idea to search for these hidden gems and pair them with large enterprises that often struggle to innovate from within. They built a highly specialised search engine to identify those start-ups and the business (then called Iterate Studio) got off the ground when Eneco Netherlands asked Nordmark and company to find 1,300 start-ups in 10 categories like Deep Learning, Energy distribution and Smart Cities.
“We started looking on Google to try to find them and we were just finding such a limited number of companies that Brian said, ‘Oh my gosh, we need to find our own. We’re going to build a way to gather all this information ourselves with our own technology, put it onto our own database, and then write our own search engine to try to uncover these companies for this energy organization.’ And so, we did that as part of that project. We were able to find 1,300 companies in these 10 spaces,” says Nordmark
By 2015, the company changed its name to Iterate.ai to emphasise its AI-driven curation capability. The platform indexed start-ups by categories and provided a way to grade start-ups based on their capabilities. By pairing these start-up companies with large enterprises, they invented a new way to help companies overcome seemingly intractable challenges. Today, the service has identified some 15 million start-ups in their database.
The second phase of the business developing “middleware” software to connect legacy systems automatically and easily to new and innovative software came about when they discovered the challenges large companies face when trying to integrate new technologies. “We would identify these companies that people should work with, and a lot of times the large organisation is so complicated that the start-up isn’t really a solution because it has to interact with a lot of other capabilities. Then the second barrier to getting things done is that traditional IT organisations have tremendous resources, but they’re dedicated to things like SAP or Oracle upgrades, just running the business day-to-day. They’re working with legacy stacks and they’re very complex. It’s hard to integrate stuff into them. Plus, many simply don’t have the skillsets to operate stuff like AI,” says Nordmark.
In 2017 they built the first version of a low-code, micro services platform that connected with legacy software stacks that the company claims speeds up software development by 10X. “We think we’re the only development platform in the world that can operate low-code both in a prototyping environment and have that same code move into a highly scaled enterprise environment. So, it becomes this layer of software that modernizes the legacy tech stacks of organisations,” says Nordmark.
Today, the San Jose, California-headquartered business has some 65 employees and is growing fast. “We grew 284% over the past three years. We’re in the Deloitte 500 fastest-growing companies list. The great thing is more than 80% of that list has VC or private equity backing. We just do it on our own, with no marketing. That means our product is unique, I think, and next year, we’ll grow in the 62% range with what’s already booked through 2022,” says Nordmark. The company was bootstrapped from the beginning without much in the way of outside investments, apart from some early angel investments.
Nordmark grew up in Westminster, Colorado, where most kids didn’t go to college. “My dad lost his job when I was a freshman in college. It was back when guys kept their job forever. He was never able to really get going again. I think that just scared me and I thought, ‘I am never going to get in a situation where I maybe lose my job and I can’t find a new job. So, I just got to control my own destiny as much as I can,” says Nordmark.
He left home in high school to play hockey in the U.S. Hockey League, considered the best junior hockey league in the US. But leaving home at an early age meant he had to take charge of his life to get through high school. “I’ve always been kind of a self-starter,” says Nordmark.
While professional hockey wasn’t in the cards for him, he joined luggage maker Samsonite after graduating from the University of Colorado, Boulder. “They wouldn’t hire me as a marketing person because I didn’t go to the right school,” says Nordmark. But he got his foot in the door as a salesperson and after two years he got his chance in marketing and quickly rose to a management position when his boss was fired, and he stepped up to take his place.
As e-commerce started to take off, he tried to convince the company to start an online division without success. So he decided to go on his own, creating a company called eBags. “It ended up being a little bit harder than what I originally thought. And it took longer to get there. But at the same time, I thought then and I still think about it and I have this belief it was going to work if I just kept at it. That’s the way, I guess, I’ve been my whole life,” says Nordmark. His hard work paid off when Samsonite would later acquire the company for $105 million.
His belief in the power of hard work and teamwork goes back to his hockey days when his coach Jack Barzee pulled together a group of players without a superstar among them and some who were cut from other teams to work together to win a national championship. “He made me realize that if everyone just plays their role, everyone gets along well and helps each other and respects each other, you can win in these areas you were never expected to win.” Says Nordmark.
As for the future? “From a product perspective, my hope is that we can build products that make these advanced technologies easier and safer. My hope is Iterate can make the world safer in ways that companies and organizations otherwise couldn’t get there themselves. I think if we can do that, the company will be big and successful,” concludes Nordmark.