Richard Branson believes that the best businesses are born out of frustration, that moment when you go, “screw it, I can do better”. This was certainly true for Craig Smith, who began his multimillion dollar business nine years ago, at the tender age of 15, as he struggled to learn French and Japanese.
Craig had to learn more than 3000 words from a textbook list of the two languages. He wanted to hear the words and find a way to test himself, to see if he could recall their meanings. His frustration led him to develop an online vocabulary tool that would allow him to hear each word pronounced by a native speaker.
The programme worked. His foreign language skills improved and he inadvertently created the first version of Language Perfect – now used by seven out of 10 senior high school language students in New Zealand.
The programme is also gaining ground in international markets, selling in Australia, England and America.
“While I built the first version of the software at high school, we only started commercially selling the product a few years later,” says Craig who, together with his brother Shane, built the Dunedin-based company from the ground up, with only a few hundred dollars.
Callaghan Innovation has supported this growth through R&D grants totalling $240,000 in 2012, which included funding to develop an iPad application and the new Dynamic Grammar programme.
Dynamic Grammar was developed to customise Language Perfect for schools, allowing teachers to build in more advanced content to suit the curriculum.
Craig says that with these features they were able to more than double their revenue in a year.
“This has played a massive part in our sales growth in Australia.”
The Australian market now accounts for more than 75% of the company’s revenue, with significant growth in the past 24 months.
“The iPad application, launched in March 2012, is also hugely popular and iPads now account for 20-30% of the Language Perfect usage,” Craig says.
The company is currently expanding Language Perfect to cover the full secondary school curriculum with Education Perfect, which is being supported by another Callaghan Innovation grant of $650,000.
“The challenge is to build a framework that can deliver questions for students in a wide variety of formats – for example, images, dynamic graphs, video and interactivity exercises – and better engage them,” Craig says.
“Our five-year goal is to have 2000 schools using Education Perfect with all their students, which would mean around two million students. This would also mean our revenue would be substantially over $100 million a year.”
Craig says that speed is imperative in their market. “The funding from Callaghan Innovation has enabled us to move faster and more effectively to secure a key market position with both Language Perfect and Education Perfect.”
Updated: 7 September 2015