SaaS Interviews with CEOs, Startups, Founders
1133 How to slowly quit corporate, code your platform and land your first customer
31 Aug 2018
Chapter 1: Who is Ross Andrews and what is his background?
Hello, everyone. My guest today is Ross Andrews. He's an entrepreneur at heart and loves creating things to find new and innovative ways to improve the quality of our lives, the way we run our businesses, and to make our world a more efficient place. His background is in genetic biology, and clearly he's taken a few twists and turns in life, now running a software company called Proximate.io.
He loves to meet new people, learning about why they're working on and discussing new ideas or whatever they are pursuing at the time. Ross, are you ready to take us to the top?
I'm going to definitely give my best.
All right. Proximate.io. What are you guys doing? How do you make money?
So Proximate is designed to be a enterprise SaaS sales intelligence solution. And so our goal is to make sales intelligence, predictive sales analytics really simple and easy. You know, I say whenever I'm talking, people like to say, we want to make predictive sales intelligence as easy as signing up for Netflix, where
You just you create an account, you sync your company's CRM and we do the rest of the work for you, making you kind of headache free for our customers. Our goal is, you know, so it's a SaaS application. So, you know, we run on a. you know, a typical SaaS revenue model.
Ross, what's the average customer pay per month?
Our license is $200 a month. And we do offer, you know, an annual subscription, which is a discounted price, two months free for $2,000 for the year.
Okay. And you're selling typically to the one individual or you're selling bulk deals to teams?
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Chapter 2: What is Proximate.io and how does it function?
So how many licenses have you scaled to today? How many folks using you?
So we are actually just in our initial beta phase. So we have some beta partners that are going to be, you know, using the platform for the next month or two. And then we're hoping to roll into a full launch, you know, later this fall slash early winter.
I love that, Ross. Okay, so so are you pre revenue today? Have you have closed anybody?
We are pre-revenue. All of our users are on a free, you know, are using the platform for free at the moment while in the beta, you know, we're doing bug fixing, all that good stuff, user feedback. And then once that's complete and we're confident everything is working 100%, we'll roll into our full subscription model.
Okay, I love this. So a lot of people listening are like, Nathan, why don't you ever have any pre-revenue people on? That's where I am, not these people doing 100 million in revenue. So this is gonna be a valuable interview for them. When did you launch the company? Was it just, did you start coding in this year?
So we've basically been coding. So I have a co-founder. He's the technical founder. He's been coding for about seven months just to get to the platform to where it is today, which is in that beta phase.
And then, like I said, we're going to do about a month or two of testing, just make sure all the bugs are squashed, any bugs that pop up, get some user feedback, make any fine-tuned performance changes, and then roll into that full launch.
And it's just the two of you right now?
There's actually four of us. The two of us are the founders, and we have two other members who joined our team a little bit later on in the process. So we're a four-person team right now. We're all under the age of 26. So a young, hungry team. We all kind of have a diversity of backgrounds, both personally and professionally. So it's kind of cool.
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Chapter 3: How does Proximate.io generate revenue?
OK, so I was going to ask you, so how are you paying everybody? So no one's taking any pay right now. They're just doing side. They're just putting in less time and doing side work.
Yeah, most of us. I mean, I'm full time on Proximate and then my side jobs are kind of part time. The other three have full-time jobs and they work on proximate in their, their, you know, nights and weekends, I guess you could say is that, you know, the kind of the traditional weekend warrior startup founder.
And then we're hoping eventually, you know, the next few months here, when we get this off the ground more fully that we can get that seed round in so that we can really go all in full time, all four of us.
What are you aiming when you do a seed round? How much do you want to raise at what valuation? Yeah.
Our goal is to raise $500,000 for a 12.5% stake in the company. So it's a $3.5 million pre-money evaluation. It will be $4 million once the money's in. And that's a really good starting point for us. It gives us a 12-month runway to start onboarding customers, hopefully get some traction, get some revenue on the books. And our goal is to aim.
Our goal is to aim for 500 licenses in the first 12 months. Once we fully rolled the platform out.
Yep. 500 grand in a 12 month runway means your expenses right now, I'll call it 40, 41 grand per month. Is that mainly salaries or any other big expenses?
That would be, yeah, that would be basically the 40 grand a month would be, uh, all four of us to get us, you know, at least a starting salary. So again, we can do this full time. And then some I've budgeted in, you know, some marketing sales expenses, travel, you know, um, Later in September, we're sponsoring a startup showcase in the Boston area.
So little events like that where we're going to start to go out and really kind of spread the word about what we're doing.
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Chapter 4: What is the current status of Proximate.io's customer base?
One is in Ohio and one is in Florida. We are a distributed team at the moment.
And how did you meet the other two that are not in Boston?
So the co-founder who was in Florida, he and I met through my stepfather who run, he also runs his own business. So that's how kind of he and I met. And then the other two, one I met through just another professional connection I had. He's our chief data scientist. So he does all of our AI programming. And then the other one, I met her at a, just a networking event.
And I was just really impressed by her resume and her background. So I,
approached her about her interest in joining our team and uh we kind of just evolved organically from there and ross are i assume you're like the business guy right oops sorry you broke up there on the last one no problem i said i'm assuming you're kind of the business guy right yeah i'm the you know sales marketing business ops guy and it was your idea
Yes, Proximate started, I started off the concept.
So let me ask you a question. There's a lot of business people right now listening or the analysts at VC firms that want to jump out and do their own thing.
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Chapter 5: Is Proximate.io currently generating revenue?
But they always go, Nathan, how do I find a technical co-founder? And I say, well, you got to be really persuasive, right? So walk me through, how have you convinced all these other people to in their free time, do work for you for the past seven or eight months with no salary, betting on the chance that maybe this becomes worth something one day?
Yeah, you know, I think the key for them was when they met me, was hearing me talk about Proxmox and how passionate I was about the idea and how, you know, from my own experiences, I really believe that this platform could make a difference in sales peoples and sales organizations lives in the future.
And I think for a lot of them, they said, listen, for the three of them, they said, listen, you seem so passionate about this and you've done the homework, you've done the research, you know, I share with them all of the information that I've sourced to kind of, as I was putting the idea together, And I think that was just really what helped convince them.
You know, for Thomas Bowles, who's my co-founder, he was he is the Salesforce administrator for a for a B2B company. So he has a little bit more firsthand experience of kind of some of the shortcomings in the today's CRM sales cloud environment. And he's seen it firsthand. So he kind of was a little faster to relate to. Oh, yeah, yeah. There's definitely a.
a gap here with what salespeople need and what's available to them today. So I'm I'm excited to kind of go on this journey with you to see if we can come up with a solution together and put this together. And then the other two, like I said, I think they just really... How did you incentivize him in terms of equity?
Are you guys just 50-50 partners or what would you give him?
Roughly, you know, he and I are the two primary shareholders. You know, I have a slightly larger stake in the company, you know, being that the concept was mine to start. But yeah, he and I together own the bulk of the company.
More than 90%?
Um, we have together 80.
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Chapter 6: What is the team structure at Proximate.io?
Guys, I'll just tell you to those of you listening on your way to work this morning, you know, another great way to do this without having to give up equity is say things like, hey, early advisors, you'll have right of first refusal on the seed round. Right. So if you want to get in, like you can definitely get in.
I just want to I always try and encourage people as best they can to get people around them without having to use monetary incentives, because people that give bad advice are typically the ones that ask for advisory shares. Right. Or require advisory shares before they lift a finger. It sounds like you know, this is a totally OK way to do it. I just want people to have options. Right.
A first refusal is good, too.
Yeah. So I actually have a third. I call him an informal advisor. He actually is doing it without any equity. We don't actually list him as a formal advisor. It's a little more informal. So we have a little bit of both. And like you said, for the people listening, there definitely are more than one way to go about that.
Very good, Ross. Let's wrap up here with the famous five. Number one, what's your favorite business book?
I just got the High Performance Handbook by Iliad Guild and it's been, I'm not done reading it yet, but so far it's fantastic.
Number two, is there a CEO you're following or studying right now?
David Cancel, CEO and founder of Drift. Love everything that he and his team are working on and they're about.
Number three, what's your favorite online tool for building your business?
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