TERP experienced a sales paradox in 2020. We had a surge of new contracts combined with diminished short-term sales. The paradox was partly due to the corona pandemic, partially because we implemented a new business model, and partly because of capacity issues.
In the information to investors in May 2020, we informed about a lost semester. The lockdown in March effectively stopped all maritime education in the Philippines as they had no contingency plan. The next semester started in August/September, two-three months later than planned, which resulted in only having revenue from one semester in 2020.
Changing to a subscription business model in the second half of 2020 reduced the short-term sales even further. Earlier, we sold textbooks at the beginning of each semester. Now we have recurring revenue every month. A third factor was the capacity of the Customer Success Team. We had neither personnel nor systems to deal with the surge in new contracts. We temporarily stopped all active sales and focused on building our Customer Success Team and related functional units.
The presents of an efficient Customer Success Team has proven to be critical for scaling TERP. They ensure smooth implementation, so we get value out of the signed contracts. We have started to involve the Customer Success Team already in demos made for potential customers. They are also engaged in pilots, which now is much shorter than before. Before, we typically piloted a whole semester. Now we developed a pilot concept with a 30 days timeline.
As a result of these adjustments, we discover the implementation challenges before the contract is signed. The customer already knows their contact person in the Customer Success Team, and the implementation goes smoother. It is not perfect yet, but we are improving our working processes every week. The backlog of contracts not yet under implementation is almost empty. What we focus on now is to strengthen our playbook gradually through a series of systematic experiments. By identifying the best practice for the different parts of the operations and making it a part of our documented playbook, we can hire new personnel with a predictable outcome. Then we can gradually scale the Customer Success Team as our sales grow.