It took more than a year and a half, but Andy Eastes and Slav Ivanyuk of SkuVault are Louisville’s latest Endeavor Louisville entrepreneurs, joining teams from the Rivera Group, RedeApp and El Toro in the highly competitive program.
To be accepted, entrepreneurs must first pass a local selection process (SkuVault did not on the first try) and then an international selection process, which the company passed last month in Boston.
SkuVault is a cloud-based inventory and warehouse management system that was founded in 2012.
Among its local mentors are big names in business like Matt Thornton of the Thorntons gasoline and convenience chain, serial investor Greg Langdon, David A. Jones Sr. and his son Dan Jones (Dan Jones is an investor in Insider Louisville), and Papa John himself, John Schnatter. Eastes said that the strength of the mentors helped propel the company through the international selection process and that he hopes to have some of the mentors join SkuVault’s advisory council, which the Endeavor organization recommended that the company build.
Indeed, mentorship is key to the nonprofit Endeavor program, which supports high-impact entrepreneurs around the world. Being a part of Endeavor is a rare honor: according to Endeavor, the only offices in the United States are in Louisville, which opened in 2015, as well as Detroit and Miami. The program provides mentors from across the business world to these entrepreneurs who are in fast-growth companies.
According to Endeavor, the businesses in the program have created 587,000 high-value jobs and in 2015, generated $8.16 billion.
Eastes got his start in e-commerce while he was in middle school with future Street Moda CEO and founder Matt Kubancik. They’d rummage through friends’ and families’ basements and attics and sell their unwanted things on eBay for a commission, he recalled. Soon the young men were driving to Ohio to buy up carloads of shoes at the Champs Outlet and selling them online for a markup. Eventually they struck a deal with the outlet store manager, who agreed to save them the trip and just have shoes shipped directly to them.
“It was the Wild West of e-commerce,” said Eastes, who may likely have been one of the youngest early eBay entrepreneurs.
But eventually, he quit to attend the University of Louisville Speed School’s Industrial Engineering program, where he met SkuVault co-founder Ivanyuk.
Kubancik hired the pair to find a warehouse and inventory management system for Street Moda, an online discount shoe vendor, and after several months of looking they couldn’t find a good fit, said Eastes. So they decided to custom build one and the beginnings of SkuVault was born.
SkuVault tracks inventory from the moment it enters a warehouse until the moment it leaves. This application allows warehouses to shelve items wherever they have room. Before this kind of technical advancement, warehouses shelved items in alphabetical order, or some other order, which forced people to have to move items to make room for new items. Eastes explained that if you shelve Nikes next to Pumas and suddenly you get more Nikes, you’ll have to move those Pumas to make room, which requires more work without adding value to the company.
The company’s focus is on small and midsize retailers, a segment of the industry that is growing rapidly. “The barrier of entry to e-commerce has never been lower,” Eastes said. He also sees the company going backward on the supply chain and working directly with brands and manufacturers as well.
Currently e-commerce accounts for only 8 percent of retail sales, Eastes said. But Money Magazine recently wrote “about one-third of malls in the U.S. will shut their doors in the coming years,” citing a retail analyst. Kmart and Macy’s have announced store closings, due in part to the rise in e-commerce. So SkuVault is poised to be in a strong position to serve the online industry as it grows.
But SkuVault has myriad applications in businesses you wouldn’t expect. Insurers are required to keep paper records of all cases for several years. And, should something happen with a case, they need to be able to retrieve those records quickly. Enter SkuVault, used by insurers to track each box of records.
Likewise, large property management firms, which keep inventories of parts and materials for fixing and re-renting units, can keep their inventory of toilets, paint and carpet in order using SkuVault.
The company’s revenue has more than doubled every year since its founding, with 15x growth in the last four years. According to Endeavor, “the company is well on track to exceed $150 million in revenues and reach 20,000 users in 20 countries by 2020.”
SkuVault customers can pay monthly or yearly. The full product starts at $300 a month, but it has just introduced a new “lighter” version for small companies at $100 a month. Eastes hopes that SkuVault will help these small companies grow until they need to upgrade to the full version.
The company has around 500 active clients and 51 employees. Eventually, Eastes and Ivanyuk and their advisers will seek funding for the company — around $5 million. That money will be to expand development and marketing and will go toward adding people to those departments.
Eastes said that living in Louisville is a boon for SkuVault because it is a logistics hub. He’s seen several clients relocate to Louisville over the years for that reason. But that often happens without much fanfare. “We know e-tailers are here in Louisville, but we’ve never heard of them and they’ve never heard of us,” Eastes said.
SkuVault won a Hot Dozen Award in 2013 and a Fast Dozen Award in 2015 from Greater Louisville Inc. Eastes also won 2016 Young Alumnus Award from DeSales High School.