As a co-entrepreneur at Cloud1 – Harri Puupponen experienced firsthand what leading growth requires from leadership

Over the years, Cloud1 received acquisition offers from both domestic and international parties. Harri Puupponen learned the true value of money in building a new growth story.

Harri Puupponen has travelled a long journey in the IT industry, from a freelancer entrepreneur to a growth company founder, leader and owner. The latest phase began when Voland joined Cloud1's growth journey as a co-entrepreneur in December 2022.

"Everyone has their own internal change process. My experience is that change takes time and is not necessarily easy. It is worth preparing well in advance and having discussions with entrepreneurs who have been in similar situations," says Puupponen.

From freelancer to growth company founder

Paternity leave at the turn of the 2010s became a turning point for Harri Puupponen as an entrepreneur. As an IT freelancer and solo entrepreneur, Puupponen wanted to create a work community and an "actual company" enabled by it.

Cloud1 was born when four IT consultants joined forces in 2012.

In ten years, the company grew into a specialized company employing over 50 employees, focusing on Microsoft Azure cloud technology and technology services for utilizing business-critical data for companies. The niche expertise in data platforms and data development built on cloud technology became the core of Cloud1's growth story, which also draws from the current growth story with co-entrepreneur Voland Partners.

"We had seen how business works and identified the market niche where we could position ourselves. We focused on a relatively narrow area of Microsoft cloud technology, but we did it at a level that few in Finland could match," says Puupponen.

Growth through chaos

Puupponen served as Cloud1's CEO for ten years.

"Because no one else did it," he laughs.

In an entrepreneurial manner, Puupponen managed the company's operational functions until the turn of the 2020s, when typical growth challenges for an IT company emerged. First, 20 employees, then 50 employees change the nature of the company and require management and support functions on which growth can be built safely and responsibly. "I gained firsthand experience of the growth bottleneck in the industry first with 20 employees and then with 50 employees. At some point, there are so many things in hand that my attempt to be involved in everything related to the company's daily operations just doesn't work anymore"

"For me and Cloud1, the need for change ultimately came naturally from the need to manage the chaos of growth. Amidst all this, the question arose, where does all this ultimately lead? It was a pretty fundamental internal reflection on why I do this."

Comparing growth options

At the same time, as Puupponen and his fellow entrepreneurs pondered solutions to the company's structural challenges, Cloud1's growth figures had attracted attention among investors and parties interested in M&A.

The exit light began to flash brightly in Puupponen's email and phone.

Cloud1 was offered a path that many entrepreneurs choose: the company is sold too early relative to its potential.

"I stopped counting when 50 contacts were full. All possible offers came from domestic and international sources. At no point did I think that Cloud1's story was coming to an end. Rather, the thought was that the company must be larger than its founders, able to manage on its own as an independent organism," Puupponen reflects on his thinking before the
decision on co-entrepreneurship.

"I got to have discussions with almost all growth and buy-out investors in the country. They provided a lot of new perspectives and what a private equity partner would expect from us," Puupponen explains.

Money became a topic in the discussions.

"If you think of private equity as a partner, money is easy to sell. Focus on money is for those who have no other competence. It is worth listening carefully to how much the investor is willing to put themselves on the line. What is the competence that helps achieve the goals."

"Along the way, you also saw the extreme examples where you are offered a lump sum of money and expected it to multiply within a certain time. It is actually dangerous if you are given money that has no purpose.

The value of co-entrepreneurship

At Voland, Puupponen's attention was drawn to the team's experience in developing, managing, and understanding technology-based services growth companies.

Co-entrepreneurship was ultimately what enabled Cloud1 to overcome the growth
bottleneck.

"The most valuable thing has been the support of Voland's team in developing business and strategy work. Voland shares the risk as a co-entrepreneur and brings expertise and new people from their network to enable our success story. That is what I value the most," says Puupponen.

Co-entrepreneurship has also brought a rapid growth leap.

Cloud1 has made two acquisitions and grown organically despite industry challenges. The company's turnover will rise to 25 million euros this year. Cloud1 currently employs nearly 160 employees.

Success with a co-entrepreneur requires founders’ internal willingness and ability to change. For Puupponen, the greatest success as an entrepreneur has been seeing Cloud1 develop to stand on its own.

"In the big picture, co-entrepreneurship with Voland has allowed me to reduce entrepreneurial stress. It has been relieving to see how change happens. The company lives on its own, and I am not the one who supports the company's operations."