The ABC of a good ROI

Before the digital learning platform Faqta was created in 2016, Binkhuysen worked in the educational publishing world for years. She noticed that her son was getting stuck at school because his way of learning did not match the old-fashioned teaching methods used. Binkhuysen started working with an experienced teacher and together they came up with Faqta. It allows teachers to link different subjects to one topic using lessons, videos, and assignments that fit together. This helps pupils make connections between different subjects and encourages active learning. More than 500 schools in the Netherlands from group 1 to 8 now work with Faqta.

A: Always invest in yourself

A lot of investment preceded this result, says Binkhuysen. "In the first phase of our business, we participated in UtrechtInc, a programme for startups from Utrecht University. Our focus then was on bootstrapping, where you borrow as little money as possible from outside sources. Purely to keep a grip on our own business. Back then, we mainly invested in Faqta ourselves. Then you're talking about a lot of time, about €70,000 from your own savings, and not paying yourself a salary for 4 years."

B: Determine what your business needs

After the start-up phase, Faqta also raised external investment. First from angel investors and then from a major publisher. Where did this money go? "Besides hiring staff for whom you obviously want a good location, you also need to keep on developing your product. That requires a lot of expertise. So we had to invest heavily in external authors and content providers for our platform. That uses a lot of software, by the way. Which is why we employ our own development team and pay monthly for software licences. And then, of course, you want to bring your product to the attention of some 200,000 teachers spread across almost 6,500 primary schools in the right way. Marketing has always been very important to us."

C: Conversion and cost management are important

For an innovative business like Faqta, investments are badly needed. But how do you make sure there is enough revenue in return? According to Binkhuysen, you have to keep a close eye on your expenses. "Make sure you are working on the financial side of your business from day one. Use accounting software that gives you a good overview and control of your costs. In terms of ROI, we look at the adoption of our product in schools. That's where our turnover comes from. In the early years, you want to grow at least 50% a year. In terms of marketing, what you want to keep an eye on is your conversion rate. How many marketing euros are needed to acquire a new customer? If that ratio is not right, you immediately have to change something about your strategy to avoid throwing money down the drain." The results do not lie. Faqta has just attracted a new investor and is currently profitable. But that is not necessarily the goal. "A few years ago, we experienced a big dip as a business because of the corona pandemic. That put quite a dent in our ROI. Our goal now is to make sure that our costs and revenues are at least balanced (break-even) annually, so that we don't depend on external money."