SaaS Interviews with CEOs, Startups, Founders
1489 Getting your First 20 Customers and $1k/mo in Revenue
22 Aug 2019
Chapter 1: What insights does the guest share about launching a successful agency?
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Guys, all of you that listen to the podcast, you were the reason I wrote the book. SaaS CEOs, founders, entrepreneurs, go grab it today at capitalistbook.com. Especially if you like audio, go grab the audible version right now. Again, capitalistbook.com. Launched a very successful agency. Now as data scientists, lawyers building Arki, they launched and started coding about three years ago.
They just launched a paid module less than five months ago. Today, they've got about 28 folks paying 60 bucks a month, doing about 1600 per month in revenue, obviously hoping to scale that. They've got 500,000 bucks in funding as they look to scale with their team of 27 folks based mainly in Denmark and one in New York.
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, everyone. My guest today is Soren Monk Hansen. He's the founder of RKey.
He's also an entrepreneur, CEO, M&A lawyer with a twin and a twin girl dad. He graduated law school with highest point grade average, tried out for traditional law for seven years, and then quit to disrupt legal business processes, and now is the co-founder and CEO of a 27-person company of lawyers, data scientists, and developers on a quest to remove manual document handling.
Soren, are you ready to take us to the top?
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Chapter 2: How does Arki leverage AI for document organization?
Yeah, no, I get it. Everyone has to start from scratch. So I appreciate you being so transparent here as you're just launching. So 28 customers, you know, 10 seats on average, six bucks a seat. You said 60 bucks a month on the low end. So, I mean, that would put you at about 1600 bucks US dollars right now per month in revenue. Is that about right? Yeah. Okay. Sounds about right.
And about a year ago, obviously there was none, right? Because you hadn't launched a paid module. That's correct also.
Chapter 3: What challenges do businesses face with document management?
Yeah. So Soren, that's infinite growth, right? That's what you want. Exactly.
So looking at my budgets, I kind of continue making infinite growth, but I'm hoping for in absolute figures, a whole lot more right now. Right now we're learning a lot. We've not been as focused on just getting, we'd rather prove that people want to pay and they want to engage. And then from there I'll sell. Actually a business model is to,
make sure that we clean up companies' documents missed by giving them that one access point for their financial and legal documents. From there, we're going to upsell to even more modules, like a contract management module, telling you when all your contracts expire and so on.
Yeah, no, that makes good sense. You mentioned that you've tested some paid stuff to get these first 20 or so customers. What is your CAC? What are you paying to acquire customers?
So right now we paid, the first problem we ran, we pay about $222,000. US dollars per customer.
Okay. Well, that's good. I mean, if they're paying 60 bucks a month, you get paid back in what, three or four months?
Exactly so. Well, we just wanted to prove that the funnel sort of makes sense to the target pricing and then upsell from there. But basically, without any upsell, it actually makes sense.
Yeah. And what's your team size today? How many folks are just on the software? 27. Okay, 27.
All two are running the consultancy.
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Chapter 4: How does the guest explain the importance of machine learning in their solution?
So what we did was that we built a team of librarians. We named it Data Island. And then we made sure that they were the ones that were going to label and annotate the data delivering to the machine learning team to make sure that every data scientist could actually spend the time on what they love the most, writing algorithms.
So we make sure that not only do we have an efficient allocation of work, we also make sure that people get to work with what they love.
That is part of it. And where's everyone based? Are they all in Sweden?
They're all based in Copenhagen.
Okay, very good, very good. Good, so everyone in Denmark though?
Yes, true. I would actually have one guy in New York right now. He just moved over there as we launched product to do some early market penetration, just to poke to the market, talk about partnerships, looking at early distribution. Aki works actually better in English than it does in Danish. We've known from the very beginning that we look outside Denmark.
Oh, good. All right. Very good. Let's wrap up here, Soren, with the famous five. Number one, what's the last business book that you read?
The last business book I read?
Um,
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Chapter 5: What is the pricing model for Arki's services?
Sometimes it's really, really nice to just go ask people to get some decent advice, people who actually know stuff.
Yep. Guys, use advice. Use it to your advantage. Going from Soren launched a very successful agency now as data scientist lawyers building Arki. They launched and started coding about three years ago. They just launched a paid module less than five months ago. Today, they've got about 28 folks paying $60 a month, doing about $1,600 per month in revenue, obviously hoping to scale that.
They've got $500,000 in funding as they look to scale with their team of 27 folks based mainly in Denmark and one in New York. Soren, thanks for taking us to the top.