SaaS Interviews with CEOs, Startups, Founders
1528 How 6 Month Old Orgo Got First 25 Customers, $7.5k in MRR
30 Sep 2019
Chapter 1: What inspired the founder to create OrgOS?
launched a couple months ago they're now doing about 70 7 500 bucks per month across 25 customers helping them with their hr needs each customer pays about 300 bucks per month they've done this by raising just about a million bucks 500 equity 500 in debt uh they're based at 12 of them based in berlin and madrid founded again in 2017 scaling nicely with uh about a 450 500 cac usually via affiliates so quick two month three month payback period they're obviously really healthy
Hello, everyone. My guest today is Max Bauermeister. He has followed his studies at KCL in London and his first experience of scaling at a rocket internet company all the way to IPO. Initially worked as a consultant for a boutique consultancy, which focuses on procurement and restructuring where he was also involved in HR and reorganization projects. Today,
He moved to help scale, sorry, two years later, he moved to help scale an insure tech organization from 15 to 160 employees within three years, supporting their international strategy. During that experience, he discovered a gap in the market for a one-stop tool to scale companies and digitize HR. Now he's focused on Orgo S to solve that problem. Max, are you ready to take us to the top?
Chapter 2: How does OrgOS generate revenue?
Yep, I'm sure I'm ready.
All right, and for those of you following along, the website is orgos.io. Max, what's the company doing? What's your revenue model? How do you make money?
Okay, so the company itself is basically an HR platform. So it's designed to digitize all your HR needs from recruitment to off boarding to onboarding to your holiday processes or HR processes. And basically, yeah, we have a license models or proceed model, essentially. Right now, it's pretty straightforward. It's actually five euros per employee per month.
Chapter 3: What is the target customer profile for OrgOS?
Exactly. And you can customize whatever modular because the Orgo S basically built up structure in a modular structure. So you can say, I want only recruitment or only onboarding or only holidays or whatever you want to do or your serving tool. Yeah.
And Max, what is the typical team, the average team that signs up with you? How many employees or team members they typically sign up?
Yeah. So, so right now I think the majority of our customers are actually high growth startups. So there's somewhere between let's say 30 and about 120 employees and they're looking to scale within the next few months or year.
Okay.
Chapter 4: How much funding has OrgOS raised and what is the funding structure?
So 30 employees at a five kind of Euro per month price point puts you at about called 150, 160 United States dollars per month, kind of on an average logo. Is that about right?
That's like the minimum, basically. That's where you would start, right? It wouldn't make sense below 30 employees. You can still handle that with Excel or any other.
Would you say that's a fair average across your base or is it closer to 200 or 300 a month?
So right now, the average users per customer is probably about 60, 70, I would say.
Oh, wow. Okay, good.
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Chapter 5: What strategies did OrgOS use to acquire their first customers?
All right. So we could essentially double that then and get up to call it 300 bucks a month minimum, something in there.
Yeah.
That's great. Put this on a timeline for me. What year did you launch the company in?
Yeah. So we launched in 2017 in February actually. Uh, that's, that's the original founding date.
Okay.
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Chapter 6: What has been the customer churn rate for OrgOS?
And have you bootstrapped the company or raised? Uh, so we raised, okay. How much have you raised today?
So we raised, uh, just shy of a million, I would say altogether in a, uh, in an initial race we raised around, yeah, Just shy of half a million to build a product, essentially. And then we raised another just shy of $500,000 this year. And since this year, we were basically live and launched the product in April with the first customers.
And all equity or was it some of this debt, convertible debt? some of this second round was convertible debt. Interesting.
Chapter 7: How does OrgOS handle affiliate marketing and customer acquisition?
So walk me through why you made that decision to do equity for the first 500 and debt for the second 500.
Yeah, for sure. So, um, basically it was, it was the easier solution for us right now, right? We, we didn't want to spend time, uh, through all, um, you know, go through all the, with all the sort of bureaucratic hurdles, uh, of having to basically go through and also we weren't sure what the current valuation was really like and we didn't want to force us or
the angels or the syndicates into a situation where they would have to basically evaluate what the company is worth. So we wanted to have the professional investors basically give their indication next year and then the angels and, um, the syndicate sort of, um, a fair chance to jump on board right now. Um, and, um, you know, not have to guess some sort of valuation right now.
But, but your first 500 was priced.
Chapter 8: What lessons did the founder learn from their entrepreneurial journey?
So there, so there was a value there. Like there usually people do is they, they raise debt or can roll note to avoid the valuation conversation, but you, you already set the valuation in the first round. So was it a situation where you needed more money? You couldn't raise it unless you did a down round. So you did debt instead. Yeah.
Uh, no, no, basically it was, it was just, um, it was just that we didn't want to have the bureaucratic, um, hurdles of raising. So, so in the first round we, we had, we gave away equity, right. Um, but in the second round it was a convertible, uh, note essentially. Um, and yeah, that was just, uh, for ease of the process, right.
Because we don't have to basically, um, run it through the notary as in Germany, here's the case, for example.
And so I see, I see. Very good. And then how many customers have you scaled to today?
So right now we have approximately between, I think it's about 700, 800 end users, essentially, consisting of approximately 25 B2B customers.
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