• Thursday, February 29, 2024
businessday logo

BusinessDay

From Lagos to Birmingham: How Shegun Otulana is transforming tech entrepreneurship in the US

From Lagos to Birmingham: How Shegun Otulana is transforming tech entrepreneurship in the US

After a successful $1.2 billion exit deal in 2021, Shegun Otulana, a successful entrepreneur and founder, has committed to transforming the tech industry in Birmingham, Alabama by building companies, investing in others, and creating job opportunities across the state.

He announced his plan to establish 40 new startups in Birmingham over the next 10 years with aggregate valuation in billions of dollars.

From Lagos to Birmingham

Otulana was born in 1979 and raised in the vibrant city of Lagos, Nigeria where he lived until his teenage years. In 1998, at 18 years of age, Otulana moved to Birmingham, AL to escape the political turmoil and violence surrounding him in his native Nigeria.

Making the 6,000-mile journey with a few bags, big dreams and the accumulated expectations of his family that had sacrificed to give him a chance at foreign education, Otulana began his undergraduate study at the University of Alabama at Birmingham (UAB).

Otulana was one of 10 children born to his parents who were both business owners. His older brother studied medicine at the UAB and he followed suit in 1998, hoping to study computer engineering.

However, since the program was limited to graduate students, he completed his bachelor of science in engineering and management information while learning software development on the side.

A product of entrepreneurial parents, Otulana believes they served as motivations for his work.

“My parents were not very educated, they just hustled — renting property out, owning gas stations. They did what they could. I had no interest in my parents’ business, but you do see this correlation between entrepreneurial parents and entrepreneurial children,” he said.

Road to $1.2 billion exit

“I knew I was always going to be an entrepreneur, had various ideas that didn’t work and that journey was ultimately what led to the first company that turned out to be very successful which was TheraNest and morphed into TherapyBrands.”

In 2004, a year after leaving school, Otulana founded his first company, Zertis, a startup that focused on evaluating the chances for long-term success of various technological products. He ran Zertis full-time until TheraNest was birthed.

Otulana started TheraNest in 2013, which would emerge very successful. It was a software product that allowed behavioural health providers to manage all phases of their therapy business.

In August of 2013, Otulana stepped down from his post as CEO of Zertis to focus on TheraNest.

Later in 2017, he created Therapy Brands, a company which would house TheraNest and other software-as-a-service (SaaS) products for therapists.

Therapy Brands was ideated after a friend at Catholic Family Services contacted him to research management software platforms and he recognized the untapped market. The resulting product, “TheraNest” was originally named by Otulana’s wife, Mary.

But Otulana wanted something bigger and better that would impact more people in his community.

“While I was still at Therapy Brands, I really began to think about the next phase. I knew that whatever I did next had to still be about building things, that’s really what drives me. I believe that building companies and producing the economic empowerment that comes from building things can be very life-changing for the builder and for the people that you touch.

I thought about how do I take the lessons I had learned and the opportunities I now had and scale them with three things in mind: building great companies, helping the community I found myself in and creating economic opportunities.”

Otulana grew his company to an innovative enterprise valued for its service to more than 200,000 therapists and helping them improve the lives of millions of patients, and in May of 2021, Otulana sold Therapy Brands, TheraNest’s parent company, for $1.2 billion to the investment firm KKR of New York City.

He then founded Harmony Venture Labs (HVL) to support startup founders by equipping them with capital, providing guidance, resources, growth coaching and advisory services.

The 10-in-10 project

Otulana created Harmony Venture Labs to create other companies.

“We take the financial resources we have and put them into building companies, and we let those companies grow and thrive and all of our energy goes into providing growth, job opportunities with those companies,” he said.

2 years into its journey, HVL had impressed everyone. Its profitability grew astronomically, attracting loyal investors and establishing its presence in its market. HVL launched six companies generating several millions in annual revenue.

All this, Otulana, owes to good fortune.

“We became very profitable very fast. We did not raise a lot of money. My company was very capital efficient and built a company that became profitable within its second year. This is certainly not the norm, but being capital efficient has become a best practice.

Our goal is to launch 40 new startups in Birmingham– with an aggregate value in the billions of dollars,” according to him.

He said “It took us about seven and half years to take our prior startup to a company worth north of a billion dollars. But I project we can build 10 companies over the next 10 years with the insights we’ve learned and with the support of a lot of people in our community.”

Otulana hopes to use his expertise in the tech scene to achieve his big goals. Leveraging decades of experience and expertise in the industry, he claims to have mastered avoiding commercial landmines that sabotage success.

“I’ve witnessed entrepreneurs making the same mistakes over and over again throughout the ideation, customer validation, and product development stages of growing a company,” he said.

“I’ve found a way to avoid many common startup pitfalls by doing market validation first.” He says “You can significantly increase chances of success by ensuring there is a big enough problem in the market that people actually care about.”

A future for Birmingham’ tech ecosystem

The establishment of HVL is part of Otulana’s larger goal of transforming the city of Birmingham and ultimately the state of Alabama into an attractive technological hub.

“It will be a powerful vehicle to do all the things I care about…building teams, building companies, value creation, and Birmingham,” he said referring to his innovation and growth company.

“It alleviates suffering. It raises lives, at least in this present world that we see. It solves a lot of the human problems, and I know of no better vehicle to solve this problem than to give people economic empowerment, and the number one way I know of giving people economic empowerment is through entrepreneurship,” he said.

Otulana hopes that HVL will empower young startup founders in Alabama, encouraging more people to create startups, which in turn could lead to exponential partnerships with loyal investors and an established audience.

“Birmingham has challenges to building high-growth companies–lack of capital and talent staying in Alabama, but I feel me and my team can overcome these obstacles and turn these problems into an advantage…It’s the perfect platform to do all these things and to create momentum in the tech ecosystem,” he said in an interview.

His particular affinity to the city he claims, stems from his relationships and network.

“We have a lot of ties to Birmingham. We don’t run from where we have ties, we build on them. We build more TheraNests. We put a stake in the ground and say, for however long I’m here, I have an obligation to this place and its people,” Otulana told his alma mater.

He hopes that in a decade, there will be multi-billion dollar HVL-affiliated companies distributed across the state.

“I’m excited ’cause I know what that would mean for Birmingham.”