SaaS Interviews with CEOs, Startups, Founders
1106 Fotoware CEO: We've moved 20% of our revenue from on prem to cloud
04 Aug 2018
Chapter 1: What inspired Anne Gretland to join FotoWare?
you'll make it in the end it will all be okay she joined photo where just two months ago they were launched in 1997 now 28 people transitioning and really started as file storage on-premise solutions i'm talking servers in the basement kind of on-prem they're now shifting under ann's efforts to a pure play cloud model sas model as they transition revenue will be flat and maybe decline for a
400,000 or sorry, 4,000 customers paying on average 125 bucks a month. That's how you get 500,000 bucks in monthly recurring revenue, which is again, 4 million Norwegian Kron per month, less than 3% logo turn annually. That's about a hundred out of the 4,000. So that's healthy again, team all based between Norway, Australia, Sweden, and Russia.
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 of 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. Hello, everybody. My guest today is Anne Gretlund.
And before joining her current company, PhotoWare, she held the position of COO at Compello Group. She spent 17 years at Microsoft and held several leadership positions in Microsoft Norway and Western Europe headquarters. She's one of the founders of ODA, the largest network for women in tech in the Nordics, with 8,000 members.
She's educated in the USA and Norway in communications, marketing, and leadership. And in 2017, she was named one of Norway's 50 leading IT leaders. And are you ready to take us to the top?
I am.
All right. PhotoWare. It's not your company. It sounds like it sounds like you joined. Is that true?
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Chapter 2: How did FotoWare transition from on-premise to cloud solutions?
Because right now we're doing like a lot of customers, we're talking one-to-one, we're selling one-to-one, but we basically want to have a self-service platform where customers that don't require a specially made system, they can just buy it themselves.
So just to be clear, there are 10,000 seats across some amount of paying customers. How many? Yeah, go ahead.
About 4,000 customers. 4,000.
Okay, got it. So you've got on average, call it two and a half seats per customer. Yeah, average. And who is that? What's their position typically inside that company?
Well, it also will vary in terms of what the customer is. So at certain times, it's those who work directly on, for example, we have some museums. So it will be the people who store and categorize typical librarians or those who have responsibility for the pictures. In other companies, it will be the marketing managers.
In other companies, it will be the police or it will be typical photojournalists and journalists making huge newspapers, making a story and making sure that they can get the pictures quickly and in the right size into the newspaper.
Okay. Now, Anne, I think this math is wrong here, and I know you're going to correct me. If I take those 4,000 customers times a monthly ARPU average of three grand, that puts you at 12 million a month, which means you owe me a steak dinner. I don't think you're that big, though. Where's my math wrong?
I think that I also include a lot of the customers who have on-premise but recurring revenue customers. And so, um, yeah, it's, uh, we, we also have, because we wanted the customers to get used to having the subscription way of thinking. And so we have a lot of customers who have on-premise solution that we actually are giving us subscription revenue. So yeah, I think that I'm doing the wrong.
That's okay. So generally, I don't want to push too hard here, but generally speaking, are you guys doing North or South of caught three or 4 million a month today?
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Chapter 3: What is the current revenue split between on-premise and cloud for FotoWare?
13 out of 4,000 for January. But when we see last year, we lost about 100 customers on-premise, but nobody on SaaS.
Interesting.
Which is very interesting, yes. And that actually confirms to me that when you have a customer on SaaS, that means they're on a model, that means that they want the software, they're paying a fee, monthly fee, and they're happy with that and they can get updates. But when they're buying on-premise, they sort of shift. Now...
I have to say that some of the customers who we've lost, we've only lost the subscription part of it. So the customer has already bought the software and they're using it, but they just have said, no, I don't want to buy the subscription anymore. Makes sense. Yeah, so that doesn't mean that we've lost the customer. It just means that we're, you know, they don't want to pay.
The revenue mix is changing. Yes, exactly. Very good. Okay, let's wrap up quickly with the famous five. One word answers here. Number one, what's the last business book you read?
Well, I keep reading. I just reread The Seven Habits of Highly Effective People.
That's a good one.
Because I love that. And I currently read Sheryl Sandberg's Lean In. Good. Being a woman in the IT industry, I think it's a really inspiring book. And then there's a book that I always keep coming back to, and that's The Tipping Point by Malcolm Gladwell. And the reason for that, every time I join a new job, I read that book because it reminds me that certain products really take off.
Others don't, but they're equally good. Why? What's the tipping point? What do I have to do to make sure that our product is the one that actually makes it out there?
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