Business solutions are not one size fits all—especially when it comes to working with vendors and suppliers.
Small businesses fall into a challenging category. Many are too small to make the kind of large-scale purchase orders that major companies can commit to and receive favorable bulk pricing. On the other hand, consumer-facing businesses fail to provide the best options for small businesses in need of tailored purchasing solutions. Unfortunately, this challenge has dogged small businesses for years. But in 2012, Rui Ma and Karthik Sridharan co-founded Kinnek to change the way small businesses go about purchasing.
“Kinnek empowers small business owners to take control of their purchasing operations,” Ma, co-founder and COO of Kinnek tells Ivy Exec. “We help them research their purchases more easily than ever before, connect with the most relevant suppliers, get customized quotes from those suppliers, evaluate the quotes, and negotiate with those suppliers – all in a single place. We are passionate about using technology to make small business owners’ lives easier.”
The two co-founders began their journey toward launching Kinnek by interviewing small business owners and learning about how they make purchases for their businesses.
“They don’t think of themselves as running procurement. But they are,” Ma explains of the central disconnect he sought to bridge. “Businesses get price gouged and none of this process is transparent.”
To help empower these small business owners to build more favorable purchasing infrastructure, Kinnek developed its product to simplify and run point on the entire process. Business owners can simply send the company their lists of needed items and Kinnek can circle back with quotes and options within 48 hours. From there, Kinnek acts as a liaison for negotiations and closing.
Kinnek is onto something big when it comes to working with small businesses. Some 28 million small businesses nationwide make up for 54-percent of all sales in the US, according to the Small Business Adminstration (SBA). But with this great opportunity to reach these businesses has come a unique set of challenges.
“We’re proving new technology to a set of users who are historically averse to new technology and industries that usually lag behind in terms of using new technology…They’ve been doing it the same way for years and don’t want to change,” Ma says. “Transacting large volumes online is difficult even in 2016. A lot of the time, business contractors still want checks. They don’t want to take credit because of the fees or other reasons. We still see half of the transactions for clients done by check. We are asking a lot for these companies to bring their B2B transactions online.”
With a firm understanding of how to address these key challenges, Kinnek is looking to grow its reach across industries. The company is doing so with precision: not attempting to target every small business across the board but rather focusing on the specific needs in each vertical.
“We need to grow vertical by vertical to ensure that we’re growing effectively,” Ma says. Up next will be businesses in the hospitality, food and beverage, academia and arts industries.
But this type of growth across industries means scaling up their own small business as well. Kinnek is now looking for leaders to build out their core team with passion, drive and know-how.
“We are looking for people managers and want someone who works to make the team better everyday,” Ma explains. “Over time, we’ve made the mistake of hiring individual contributors…[Now] we hire actual leaders that can raise the game for a team. We want them to motivate their team daily to become the best that they can become. Another important quality is for leaders to have knowledge and past success in our space.”
Bringing people on board who embody a team player mentality is essential to Kinnek’s flat hierarchy.
“Everyone here knows what they are working on everyday, but not just because it is handed to them. They have a full understanding of the full picture,” Ma explains.
“Employees here don’t mind doing something outside their area and are great at suggesting ways to make the company even better.”
To that end, Kinnek is putting its money where its mouth is: “We offer a larger amount of equity than is typical in the startup space to [encourage employees to] buy into the company’s vision.”