SaaS Interviews with CEOs, Startups, Founders
1089 Workato CEO: "We're Enterprise Version" of Zapier, Segment, Elastoic
18 Jul 2018
Chapter 1: What is the main topic discussed in this episode?
This is the Top Entrepreneurs Podcast, where founders share how they started their companies and got filthy rich or crash and burn. Each episode features revenue numbers, customer counts, and other insider information that creates business news headlines. We went from a couple hundred thousand dollars to 2.7 million.
I had no money when I started the company.
It was $160 million, which is the size of many IPOs. We're a bit strapped. We have like 22,000 customers. With over 5 million downloads in a very short amount of time, major outlets like Inc. are calling us the fastest growing business show on iTunes. I'm your host, Nathan Latka, and here's today's episode.
Chapter 2: How did Vijay Tella build his career in integration technologies?
Hello, everybody. My guest today is Vijay Tella. He is the creator and one of the founders of a company called WorkAuto. He's led the creation of market-leading integration technologies for over 25 years. Before WorkAuto, he was the CEO of Kik, a consumer video communications company acquired by Skype. He helped create two multibillion-dollar integration products before that.
He's also part of the team that created the world's first middleware platform, TIB, the information bus, if you guys need a jog down memory lane there, at Technetron Software Systems, which was acquired by Routers PLC in 1994. He's also the founding, on the founding team and SVP of engineering of TIBCO through its IPO.
As chief strategy officer, he then helped launch Oracle's Fusion middleware platform in 2005. Vijay, are you ready to take us to the top? Yes, of course. All right. I always know when a, when a bio has lots of acronyms in it, you must be impressive, right? That's how it works.
Oh, well, let's see.
All right. Tell us, tell us more about a work auto. What's the company doing? How do you make money?
So, um, you know, we are a, uh, uh, integration software company. Um, you know, the, the, you know, companies out there are used, you know, there's using a lot of apps, uh, you know, large companies have over a thousand apps, uh, There's an explosion of SaaS in every corner of a business.
And the challenge with all of that, Nathan, is that the information about your customers and your business is splintered and split across so many different apps. So you don't have a really complete or consistent view of what's happening with your business, with your customers. Workata's products helps you connect all these apps together and automate your processes that cut across all these apps.
Elastic.io, Zapier, Segment, how do you beat all these guys?
Yeah, I think it's a very big market. Some of the tools that you talk about are focused on the small business segment and are suitable for just moving data between applications A and B. Workato's heritage comes from companies like Tipco and Technicron that you referred to earlier.
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Chapter 3: What makes Workato different from competitors like Zapier and Segment?
I get 80%, you three split the 20.
Yeah, it was something like that.
Was it really?
Look, I think the other guys were like some of the rock stars and they were some of the smartest guys I've ever worked with in the integration space. Are they still at the company? They're still all at the company. One of them was a very early person that created AWS and one of them ran products at Tipco after I left. I mean, these guys are, I wouldn't be doing this without them.
They're the brains behind the company.
So 2012, four of you guys, you get together. It sounds like really intelligent people. You've scaled to where you are today. How many customers are you serving now today?
Yeah, we have about 21,000 organizations that have signed up on Workout. About 800 to 900 a month are signing up each month.
Okay, now you said that very specifically. I think that was a free organization number. How many of them are actually paying?
Definitely more than what? Again, I think we're not sharing that out, Nathan, but I think when we say organizations, Workato is used by teams. So you have a customer success team in a large company or a finance team. the licensing with Workado can be done at the team level or they can actually roll it up to an entire company and a lots of organizations within the team can roll up under that.
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Chapter 4: How does Workato generate revenue from its customers?
Yeah, you know, I don't have the numbers, you know, in front of me, but it's, you know, our, you know, our CAC to our, you know, sort of revenue to CAC ratios are well over once. We're good with that. Well over what? You know, we're, you know, you know, so Nathan, we are like, we don't share out these revenue, these numbers with anyone. So I'm not, you know, like.
Yeah, Vijay, sorry. The reason I asked, so have you listened to the show before?
No, I have not.
Okay. The show drives incredible amounts of new ARR to companies that come on. And so one of the trade-offs is you share lessons with hard numbered data and in exchange, my audience gets exposure to your tool. And so that's part of the trade-off here.
So I understand if you don't want to give specific numbers, but helping us in tying lessons you're teaching us with some kind of range is really helpful. And that's really all I ask. So when you say something like your LTV to CAC ratio is really healthy, but then you say it's greater than one,
Here's the situation. Our company has been around for four or five years. A lot of our customers have a lot of our revenues. We've been ramping our revenues fast. How fast?
Are you talking 100% year-over-year growth or more?
We grew 300% last year in 2017. Um, so, you know, uh, the, the LTV is, you know, is, you know, or, you know, we are still early to kind of talk about LTV because like, you know, we don't see that it's really, you know, much more about expansion.
But what we are saying is that, you know, in the segments that we are focusing on mid market enterprise, the, the, um, uh, you know, we are, uh, you know, we're, you know, we're both new and expansion revenues are, you know, kind of like, uh, more than what we spent.
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Chapter 5: What strategies does Workato use for customer acquisition?
And we, you know, we want to take advantage of that.
Sure. I mean, look, one of the things is, and one of the things I have to hit on is, I mean, we see so many press releases go out that are full of PR jargon. So someone says we went from $1 of ARR to $3 of ARR. Hey, we grew 300% year over year. It means nothing, right? And so one of the things I do with this show on purpose is to try and cut through that kind of stuff and get to real numbers.
And credit, frankly, your success. I mean, it's incredible what you've built. You've had a lot of success in the past. You've learned a bunch of lessons. You're pulling that into this company. So the more numbers you can share, the more valuable it is for my audience.
I understand that.
Yeah, but I also understand your interest in keeping things vague as well for competitive reasons. So talk to me more about team today. Where are you guys at in terms of team size?
Uh, we are around 80 people. Uh, most of us in, uh, I mean, not, I mean, the headquarters is in Palo Alto, but about two thirds of the team is remote.
Okay. So, so, okay. Interesting. Mostly remote. And, um, where are you growing most right now? Break down that team for me.
I, I, you know, we're growing most in the U S and, uh, you know, we're also, you know, growing in Asia and Europe.
I meant, sorry, engineering, sales, marketing support.
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