Cuttable founder Sam Kroonenburg’s journey from start-up to $3.2bn exit and return to work
It was the classic tech star’s exit. Build a company from scratch, get spectacular growth and sell out for billions all before turning 40. But Sam Kroonenburg’s story comes with a twist.
It was the classic technology entrepreneur’s exit. Build a company from scratch, then venture capitalists invest, followed by spectacular growth and a massive $US2bn ($3.2bn) price tag in the end. All before turning 40.
But this one comes with a twist.
Sam Kroonenburg could have settled comfortably into life as an angel investor, mentor and board member, like so many recent successful tech founders. Life is good, there’s plenty of money, and no more crazy hours building the company of your dreams. But Kroonenburg couldn’t help himself.
Only a few years after he and brother Ryan sold their A Cloud Guru online learning firm for a stunning $US2bn after starting it from opposite sides of the world six years earlier, Kroonenburg is back in business at artificial intelligence advertising company Cuttable.
And, he says, he could not be happier.
“I do invest and I enjoy that. I really like to help, to mentor and I am going to start my own VC fund,” says the 40-year-old who, like his brother, is estimated to have emerged with about $500m from the 2021 A Cloud Guru sale.
“But, honestly, what I worked out over the past two or three years is I just love building. Since I was 13 years old, it’s the first thing I found in life that I want to do every day. It’s not like, ‘Oh, I have to go to work today.’ It’s, ‘Great, I get to go back to work.’ There’s a difference.”
Kroonenburg has started Cuttable in Melbourne with Sunday Gravy advertising agency co-founder Jack White along with Ed Ring, of the Ring family which founded vitamins giant Swisse. Ed Ring worked there in marketing before it was sold for $1.67bn in 2015.
There are plans to take the company global, and it already has overseas customers.
There are some new rules, though, which Kroonenburg based on advice from Australian VC legend Daniel Petre of Airtree Ventures.
“When he started Airtree [after a long tech and media career], he said he was only going to do a certain amount per week and everything has to fit around that,” Kroonenburg says.
“And so I took that advice, and my two no-go areas, or red lines, are I have one day a week with my wife, and I go to every one of my kids’ basketball games.”
Kroonenburg is generally in the office four days a week and will leave mid-afternoon for those basketball games. But he says he is working hard, and jokes he even offered to start coding again the morning he meets The List for an interview, though worries he may have scared the company’s software engineers with that proposal.
Not in it for the sell
“I think everybody thinks when you’re a founder, when you’re building a company, it’s about the exit. Can you sell this company or IPO [float] it; these big milestones. But that’s not why you start a company,” Kroonenburg says.
“We didn’t start A Cloud Guru thinking there was some big company coming to buy it. It was literally, ‘Can we build and provide a product that people love and buy?’
“Exiting and selling a company doesn’t change that. Selling it doesn’t change your internal motivation, which for me is the joy of building something impactful.”
Kroonenburg and his two co-founders want Cuttable to meld some old-fashioned advertising nous with artificial intelligence to produce quick digital marketing campaigns for brands. Its proprietary software is designed to cut down on repetitive tasks usually done by advertising agencies, and get advertising clips or branding to clients extremely quickly.
Kroonenburg had started funding the company in 2023, based on a software prototype on which White was working to streamline tasks usually undertaken by an ad agency pitching for and then producing work for clients.
He realised more work was needed, but loved the concept.
As he sees it, the opportunity is to streamline the long lead times advertising campaigns take to be built, making them more relevant to digital audiences and most cost-effective for emerging brands.
So last year Kroonenburg became Cuttable co-chief executive and oversaw a $5.5m raise of seed funding from Square Peg Capital last July, which saw its partner and Seek co-founder Paul Bassat also join the Cuttable board.
“If you’re looking at what is happening with the social media networks, they don’t want ads to stay on too long. If you’ve seen the same ad four times, Meta will deprioritise it. They don’t want Facebook to look the same every time. They want fresh content,” Kroonenburg says.
“So to have high-performing ads, you need to be constantly creating new creative [content], but the industry is literally paying humans to sit there, change the copy, move images around, make 10 different versions. So they need to make hundreds of variations to be effective.
“Brands want to tap into trends. They want to have something cheeky out about the latest thing, but you need that out within hours these days. If you do that two days later, though, it feels unnatural.”
AI for advertising
Kroonenburg gives the example of a train line in Melbourne going down and a local brand quickly creating an ad to make light of the situation to a nearby social media user, or offering a service that personalises something to a particular station.
He says Cuttable’s AI is not a generic “ask a question and get an answer” format like ChatGPT, but more of an “opinionated view” of what should work for a campaign, mixed with video and other social media-friendly features that can automatically build out a collection of ad concepts for a client to choose from.
It aims to have an understanding of a brand’s objectives, what segment of the market they are in, and who are their customers and competitors.
Cuttable wants, Kroonenburg says, to deliver the service in about an hour. “Instead of briefing an agency and waiting a week or two for ideas, we will have the ads made in less time than the initial meeting would take.”
Bringing in external capital is one of several lessons Kroonenburg says he learned from his A Cloud Guru days. Yes, he could fund the company himself but, firstly, he wanted his co-founders to be on the same footing – “everything I did with my brother at A Cloud Guru was equal” – and the venture capitalists he had then provided sound advice and a network he could tap into to find talent.
“The number one mistake I see founders make is to not be self-aware enough to know what you’re not good at. Bring the right other people in. It’s OK to not be great at something,” he says.
“We made a tonne of mistakes. Hiring the wrong people was certainly one. The other is maintaining focus. There have been times we’ve messed up at Cuttable, but we’ve been able to recognise it and correct our course within weeks. Hold on, we’re losing our focus. You can see it coming more now, I hope.
“The other thing is to hire people for the journey. If you’re a $1m revenue company trying to get to $10m, try to hire someone who has been there for that before. It is hard to find people. But try to hire the right leaders.”
Was it hard to let go?
It was quite a journey at A Cloud Guru, which Kroonenburg is clearly still nostalgic about. When asked if it was hard to let go, he says, “Yeah, I struggle with that because I don’t want to sound ungrateful. We have five kids, my wife and I, and we always call A Cloud Guru our sixth child. It was a big part of our lives and our family. It was the greatest ride of our lives.
“As a founder, you’re all in. That was my life. It was most of my social connections. I was working all of the time. And to sell it, it was hard to step away from that.”
The Kroonenburg brothers started A Cloud Guru after Ryan, an accountant, was rejected for a job at Amazon Web Services after three months of interviews. He may have got the job if he had attended an expensive AWS training course, and so figured creating cheap online education courses could work as a business.
The duo decided to focus on offering nothing but cloud computing courses and launched in 2015, which proved to be brilliant timing as the mass migration to the cloud by businesses all around the world eventuated.
Two years in, A Cloud Guru had trained more than 250,000 students in 160 countries. Revenue soon passed the $US100m mark and by the time the Kroonenburg brothers sold it for $US2bn in 2021 to the private equity-backed Pluralsight, their business had trained more than 2.5 million students across all major cloud computing platforms.
It was a stunning deal, and also came after the brothers had already failed in one of their first ventures.
How Kroonenburg learnt to code
Kroonenburg and his family grew up in Perth, where his father was an entrepreneur who had a computer shop in the 1980s, and his mother was in education.
He remembers a day in about 1994 when his father brought home three new computers – “one for me, one for my brother and one for him, all in row in the same room. It blew my mind.”
His dad also connected them to the nascent internet and aged 13, Kroonenburg found a website in the US that had “cool 3D graphics on it”, emailed its owner asking for some lessons on how to build it, and to his surprise got a positive response.
Kroonenburg’s online “penpal” would email him website-building tips, which is where he learnt to code.
He would later get a job working at a computer store that grew out of an auction business selling off computers and parts seized by police.
While still in high school, he started his own software business, and had about 750,000 downloads by Year 12. “I’d get cheques from America every month. I probably made $50,000 and spent it on gadgets and tech,” he says.
While he was self-taught, Kroonenburg needed to be a better coder so he got a software engineering degree at Perth’s Curtin University and managed to score a graduate interview with Microsoft in Sydney – and got offered a job in Seattle.
He moved to the US to work at Microsoft’s Windows Vista division and other areas, before “stupidly” leaving to move to London where his brother and father had relocated to start a business helping British people migrate to Australia.
Mistakes and silver linings
“In hindsight, I left my dream job to move to a small migration firm, which collapsed within six to nine months of me getting there because the GFC [global financial crisis] hit.”
The silver lining was that Kroonenburg met his wife, who had also been working at the business. He got a job back with Microsoft in Norway – the only place in the world where it was hiring – and then with a child on the way, moved back to Australia to settle in Melbourne. A stint in consulting followed for about five years, before A Cloud Guru was born.
That experience and his career, and some advice from Bassat, has led to Kroonenburg’s steadfast belief that you need to have an aim to build a global business these days, and that it can be done from Australia.
“Other companies are coming here. There isn’t an Australian Spotify, for example, and a European Spotify. There’s just Spotify,” he says.
“Others are coming here, so we just need to have our fair share of global winners from here. I want Australia to be a place of innovation.
“I don’t know how many times I’ll start a business from scratch, because it takes a lot out of you. But I’m pumped to be on this ride.”
More Coverage
To join the conversation, please log in. Don't have an account? Register
Join the conversation, you are commenting as Logout