SaaS Interviews with CEOs, Startups, Founders
1230 Collibra passes $60m in ARR, $133m Raised for Data Governance
06 Dec 2018
Chapter 1: What is the main topic discussed in this episode?
Good to not know a lot. Again, data is really critical when you look at GDPR, data as governance. That's one reason Kleber's growing so fast. On top of that, he's driven this company since 2008 with super healthy economics. Now, 300 customers paying on average 16,500 bucks per month. So almost breaking that beautiful kind of 50, $60 million ARR mark. 130% net revenue retention annually.
Again, his team of 300 based between US, Europe, and Australia. 133 million bucks raised. 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.
Chapter 2: How has Collibra achieved significant growth in revenue?
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, everyone. My guest today is Felix Vandermael. He co-founded and now serves as the CEO of a company called Calibra.
As Calibra's CEO, he's responsible for the company's global business strategy and has led the company from idea to founding to more than 10 years of record growth and industry leadership. Before that, he served as a researcher at the Semantics Technology and Applications Research Laboratory in Brussels, where he focused on crawlers for the semantic web and semantic data integration.
Well, well-rounded, lots of great degrees I can barely pronounce. Felix, are you ready to take us to the top? Do you like that? I like to say a lot of degrees I can't pronounce. It makes you sound really smart, right? Yeah, I like it.
Chapter 3: What strategies does Collibra use to retain customers?
Tell us about the company. So you came, first off, you came on, let me see, this would have been about almost a year ago at this point. So yeah, about a year ago, but give us a quick update. What's the company do for people that missed that first episode? Sure. So we're an enterprise software company. So we typically help large companies better find, understand and trust data.
So we specialize in data governance and data cataloging, which basically means, like I said, we help companies understand what data they have. where they can find it, and then ultimately that they can really trust it. And so I think especially today, there's loads and loads of data. Companies have lots of data, but often there's a problem that they don't know where actually it's stored.
So we call it like a data catalog, like an Amazonification of data, like you shop for the right data set. but also run around the trust and the control. And the news has been a lot about GDPR, data privacy, data protection. That's right.
So that's something that we help our customers with as well, helping them build a kind of a registry of what data they have, who has access to it, who's responsible, and then really a lot of workflows where people can, in a structured way, work together around the data. And Felix, you told me about a year ago, the average customer is paying about $16,500 a month for kind of what you provide.
Is that still about the average ARPU or have you gone down or up market? No, it's still very similar. So kind of the model is what we call land and expand, kind of a similar land deal, as we say.
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Chapter 4: How does Collibra ensure data governance for its clients?
But then what we're really excited about is that because ARPU, Customers really start adopting their product pretty rapidly. Pretty quickly, we get to large expansions where customers actually use it more and they use it in different business units or for different use cases. And so that's how kind of the usage expands. What's your typical expansion from year one ACV to year two ACV?
Are you doubling it, tripling it, less? Um, it depends. I think some of it is, is doubling some of it. We go from 150 K to a million dollar AR deal. Um, so it really depends on the use case, the type of company. Um, so it's hard to, it's hard to say an average. You had 200 customers a year ago. Where are you at today? Yeah, we're, we're close to 300 customers. Oh, great.
Um, and where's most of that growth come from? Is it kind of outbound related or it's mostly, so, um, it's mostly outbound enterprise sales, uh, right. Um, But we have a big marketing team as well, a lot of digital marketing. And then we have an SDR team kind of qualifying those leads and putting them in the hands of our outbound sales team.
And then look, 300 customers times that ARPU puts you at somewhere around 5 million a month. Have you passed that 5 million mark yet or you're flirting with it? Almost. This month or next month you think or no? Yeah, a little bit further, but it's going to be close.
Chapter 5: What challenges did Collibra face when launching in 2008?
Okay, this year? Yes. Okay, definitely this year. Very good. So yeah, breaking $60 million in AR, obviously super healthy. Now, I want to get more of the backstory now that we have some of the numerical data. So remind us again, what year did you launch the company in? We launched the company in 2008. 2008. By the way, hell of a year to launch a company, huh?
Yeah, and actually it was, like I said, we started the company kind of out of school, my first job. And interesting year to start a company, but ultimately it was good for us because it really started our growth where all of the banks started to need data governance. And so that's really helped us in the beginning.
And have you raised any additional capital since the last time we spoke when you had raised about 75 million? Yes, we did raise a Series D round in January, so a couple of months ago, with our existing investors. We weren't planning to, but they were really excited. We got great offers. So we love to have them on board, great partners to the business.
And so we raised another 58 million Series D rounds. Okay. So sorry. You said, you said another 58, 58. Yes. Got it. So one 33 total 133 million.
Chapter 6: What insights can be gained from Collibra's recent funding round?
Correct. So walk me through, I mean, that's obviously we've had maybe 10 people that have raised that amount or more on the show ever. And I've done, you know, a thousand plus these interviews. It's super, super capitalized obviously. Right. So, so what are, what's the advantage of that? And talk to me about some of your fears. I mean, what's the downside of having that much money?
That's a good question because when we started the company, we started in Europe and so we got the company to over 10 million euro in revenue and profitable and growing at 200%. So we know what it's like to build a company, basically bootstrap a company with only raising like 1 million euro.
so on a very very little money but at a certain point in time we found where this clear market opportunity you are the leader and you want to build like a large successful software company it does take quite a bit of investments if you want to start growing and scaling your enterprise sales team you want to You want to invest, continue to invest in R&D and product. It does become expensive.
And so when you are in that leadership position, we really want to remain that leader in the market, basically own that market category. And so that's why for us it made sense to invest a larger amount of money. So one, you have a longer runway, right? You're not as dependent. You never know what happens kind of macroeconomically. So it gives you that security.
Two, you have the opportunity to be a little bit opportunistic. If opportunities arise, you can say yes to those, whereas otherwise you might have to say no. And three, kind of a clear signal to the market that you are the leader in your category. It becomes harder for other companies to raise money, things like that. So these are all the benefits. I think the risks are that...
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Chapter 7: How does Felix Van de Maele view the importance of company valuation?
The risk is always when you have money, you tend to spend it. And so you've got to be really, really disciplined to make sure you focus on the right things and prioritize really well. And that just requires another level of discipline if you have the money in the bank. Okay, Top Drive, many of you ask me all the time, how did I get my website up so fast, so quickly, and why is it doing so well?
The answer is simple. I use HostGator.com to keep the thing cranking along. They've got a 45-day money-back guarantee, which is great. I used their free website builder to get the site up because it's ideal for WordPress. It's just what I use. They've got 4,500 templates and a free e-commerce plugin as well. And 24 seven support, which we love, right? We love that. I bug the hell out of them.
They always get back to me. So I've got you 30% off along with a hundred dollars and free AdWords credit to grab it. Just go to hostgator.com forward slash Nathan, but you got to do it now. Again, hostgator.com forward slash Nathan. It sounds like you were you had a significant amount of leverage in terms of this last race because you really didn't need it.
But investors, you know, they were getting your board decks. They're really excited. So you said, OK, we'll do it. I'm guessing they gave you great terms and you're a hell of a negotiator. I mean, did you break the billion dollar valuation mark? Are you close? Can you share more about that?
Chapter 8: What are the future plans for Collibra's growth and development?
Yeah, we don't share valuation. So can't really comment on that, but we got great terms. We're happy with it. I think I will always recommend don't focus purely on that pure valuation number. There's a lot of other terms that are important. Having the right partners on board are important. It's important. And so there's more that comes to it than just purely the valuation.
A few more economics questions here. Payback period. Are you getting more aggressive now that you have more capital? What do you like to keep payback period at? Um, kind of similar. We are probably around, it depends around 16, 16 months or so. Yep. And I'm curious actually how that compared you, you were at, uh, oh, we didn't talk about that last time. Okay. But 16 months today. Got it.
So, so doing the math, 16 months, if people are paying you kind of 16,000, uh, 500, kind of an average monthly right now, you're totally comfortable spending, you know, a quarter of a million bucks acquiring one of these customers. Yes. Yeah. Got it. And, and so you're doing back of the neck in math here, obviously in terms of lifetime value, what do you assume minimum lifetime value is?
It's really hard to say because we have very, very little churn. So in a way, it's almost indefinite. Obviously, that becomes hard because we have really low churn and great expansion. So net dollar retention rate is something that we look at and that's really high. How high above 100 is that? Almost, yeah, around 130. 130, okay, 130. And that's annual net revenue retention. Yes. Yeah, got it.
That's why I asked. So true or false, lifetime value has become less and less important for you in terms of a meaningful metric to drive the company because it's so high at this point. It doesn't actually enable you to make good decisions on it. Yes, I think it's a hard metric. I think payback period, customer acquisition cost, and then revenue retention rate, churn.
These are the real metrics that we look at. Yep, very good. And what is churn? How low is it? It's like 4% or so a year. Annually, and that's revenue? Yes. Okay, that's great. And team size today, where are you guys at? We're about 300 people. Okay, and where's home? Where's everyone based? It's about, I'd say, 55% to 60% in the U.S., mostly in New York.
And then we have engineering in Belgium and Poland. And then we have an office in London, Paris, Germany. We opened an office in Australia. So pretty spread out. That's great. So US, Europe, and Australia. And then in terms of where this capital raise, most of it is going, is it going towards testing additional acquisition channels? Is it going towards team size?
Where do you think you're going to be spending most of this money? It's really around scaling both sales and marketing and R&D. So continuing to kind of scale sales team and everything that comes with it from a marketing legion perspective as well. And then really on the product and R&D side, being pretty aggressive in how we build out the platform.
And then just making sure you have all the necessary functions around customer support, customer success, professional services. HR, recruiting, finance, legal, all these things become really important. And so making sure you just build the company in a very balanced way. When you think about your option of potentially going public, what kinds of things go through your head, the pros and cons?
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