For a Harbor East-based cloud and cybersecurity firm, a capital infusion of $5 million from four credit unions brings a new designation: Think|Stack is now a credit union service organization, or CUSO.
It’s the first outside investment for 10-year-old Think|Stack, founded by CEO Chris Sachse and CFO Travis Sacshe, who are brothers. With participation from CUSG, Christian Financial Credit Union, Mutual Credit Union and Liberty Savings Federal Credit Union, the round will set up the company to build on an already established speciality designing, building and managing cloud environments and security architecture for credit unions.
CUSOs are for-profit businesses that work with federally chartered credit unions, which are nonprofits. Along with being able to receive investment from credit unions, CUSOs are designated to provide operational services for the financial institution, including the kind of IT work that Think|Stack performs. In order to become one, a business must have at least one investment from a credit union, and primarily serve them.
Think|Stack meets these requirements. But the appeal of the model was also in what it meant for the company’s own growth. Seeing opportunity as it executed on a strategy and worked with credit unions to implement Amazon Web Services, Chris Sachse said the company set out to raise venture capital. The cofounders were seeing market interest, but when the term sheets arrived they faced a choice.
“We got to the point where we had a couple of different deals on the table that were very appealing,” he said. “Ultimately what made us uncomfortable was the exit path for most people was around five years and the desire to grow the top line revenue so drastically.”
Being a services business that built a strong culture, Sachse didn’t want to take a step that would hurt what was in place in the name of getting too big too fast. But over the summer he connected with credit union leaders about becoming a CUSO, and found enthusiasm. Now, with the designation, the company can make more manageable plans to build for the long-term in a space where it is already making the vast majority of its revenue.
“What it allowed us to do was slow down the growth,” Sachse said. “There’s no defined exit, so they’re looking at the long-term strategy and long-term play for us to build what I hope becomes a lasting, large business.”
Don’t mistake: The company still has growth plans. In fact, the designation as a CUSO will give it up close knowledge of the credit union space to move quickly, not to mention four investors who are operating in that world and can likely help make intros or innovate.
It’ll also mean hiring to expand the team and meet its goals: Plans call for nearly tripling employees in five years. With a 35-member team that has leadership roles in place, the company will focus around marketing efforts, and adding hires to support new business that comes in, such as AWS technicians. (See currently open roles here.)
The team will remain headquartered and keep hiring in Baltimore, where company is a founding member of the Baltimore Tracks coalition that is seeking to create a more diverse tech workforce. There is also likely to be growth beyond its home city. The company currently has 15 team members in other parts of the country, and Sachse said it’s an advantage to be able to have employees across timezones since it operates 24/7 operations centers. With remote team members prior to the pandemic and plans to travel again once protocols allow, the company will look to set up remote offices, likely in shared spaces that allow for collaboration.
“We just want to have a really flexible environment where if we need to have a meeting or give someone an office, we can have coworking spaces around the country,” Sachse said.-30-