SaaS Interviews with CEOs, Startups, Founders
1539 How Venga Hit 2000 locations, $3.6m ARR on $2.7m Raised Helping Restaurants, Fitness Centers with Customer Experience
11 Oct 2019
Chapter 1: What is Venga and how does it help restaurants and fitness centers?
Venga, helping restaurants and fitness studios manage customer experience, launched back in 2011. They now serve 2,000 locations, doing about $300,000 per month in revenue. That's up from about $240,000 per month just a year ago. Healthy growth, considering they've raised just $2.7 million. Each location paying called $150 per month.
Chapter 2: How has Venga achieved rapid growth to 2000 locations?
5% gross annual revenue churn. 7% expansion gives them 102% net revenue retention increase. Annually spending called a grand to get a new a new one hundred fifty dollar a month account. So that's about a seven month payback period. Pretty healthy team of twenty one people in D.C. and other remote locations. Hello, everyone. My guest today is Sam Polaro.
He's the CEO of a company called Venga, a Washington, D.C. based technology company that uses big data to help restaurants and fitness companies better understand and engage with their guests.
Chapter 3: What is the average revenue per location for Venga?
Before Venga, Sam was the founder of Pedals of for the people, a business that revolutionized the sale and distribution of fresh products.
cut flour sam are you ready to take us to the top let's do it all right you're a flower guy you must be very sweet huh actually once you uh once you see like the business side of flowers it kind of ruins the experience for you it's like watching the sausage get made totally understand tell me more about your current company venga what's the company doing how do you make money Yeah, sure.
So we are a customer relationship management system for businesses. We work right now in the restaurant and fitness verticals, meaning we help those companies to use their data to better understand and engage with their customers in a much more personalized manner. That's very cool. And help me understand kind of general price points. What's the average customer pay per month?
Between $200 and $300 per month per location. So if you're a restaurant group and you've got 10 locations, you're paying $2,500 a month. Is the location paying or the corporate restaurant, the corporate is paying? Most of the times it's the corporate. We do work with some franchise locations where they have, you know, the franchisee will pay for the software.
But most of the time we prefer to sell to the corporate and get all the locations.
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Chapter 4: What are Venga's customer acquisition costs and payback period?
And when you sell to one, your typical deal, you sell to one corporate. I mean, how many locations are they signing up typically? Yeah. We work primarily with groups that have three up to a hundred locations is our kind of sweet spot. Okay. Interesting. And how many locations are you across today? We're about 2000 locations. Oh, wow. Okay. So that's a lot across how many brands?
Probably between 150 and 200 brands. Okay. That's great.
Chapter 5: How does Venga maintain its customer retention rates?
And I mean, can I take 2000 locations times that 200 price point? You guys are doing about 400 grand a month right now in revenue. Yeah. A little bit less than that because some have like smaller packages, like if they're paying for you know, some partial plan kind of thing. But we're doing about $300,000 in monthly recurring revenue. Okay, that's great. Thanks for sharing that.
And most of that, you're talking like legacy accounts, maybe that's signed up at lower price points? Or they're using, you know, a fraction of our tool set. So the kind of 200 to $300 per month is if they're using all our features, but some are using, you know, a $99 price point that only covers one aspect of our tool. I see. So 2000 locations, about 150 bucks a month.
You multiply those, you get about 300 grand a month in revenue. Yep. And what's growth look like? Where were you at a year ago? We're growing about 35% a year. That's great. So call it, what is that? Two 50 to 40 K in October last year. Um, yeah, we did about for the calendar year, we did just under 2 million in revenue, but ended a little bit under 3 million in AR. That's great.
And this year you'll, what you'll close out at like 3.8, 3.9. Um, Something around there. Yeah. Between three, five and four. That's great. Now, this will be really impressive. I hope you tell me your bootstrap, but I have a feeling you might not be. Are you bootstrapped or have you raised? We've raised two point seven million to date.
OK, not actually, you know, you still get a little street cred, not a ton. You haven't raised a ton, though, which is nice. Yeah. All right. And why make the decision to raise? Why not stay bootstrapped? Well, I think, you know, if I were to do it all over again, I might take a different path. I would certainly wait. much longer to raise money.
But at the time, you know, I'm a technical guy, but I'm not really a programmer. So, you know, we need to hire engineers and a team to help us build the initial product. So that was the reason. Now, not saying it's the right reason, but that's why we did it originally. Yep. No, and you invest in design. I know that I've seen the animations on your homepage on Dribbble before.
So you go and get the right kinds of designers and you do things the right way. It makes sense there. Put this on a timeline for us. When did you launch? So we actually launched in 2011 with a product that's slightly different from what we do now. Like most companies, we pivoted a couple of times along the way. We realized within probably six months that our first product wasn't going to work.
And we pivoted to something else that worked a little bit. And then finally, probably in 2014, we really found that kind of product market fit and then have been kind of growing consistently since then. Interesting. When was the last pivot you said? You said a year ago? When was the last pivot was 2014. Oh, 2014. Okay. Got it. So 2011, 2014, kind of figuring things out.
2014, you'd kind of double down on the current space. Now you've scaled to 2000 locations. Yep. Yep. And then we just added our new vertical basically within the last year. So we started in restaurants. We're exclusively in restaurants for the first you know, six years of our life, then realize we could take that product and bring it over to the fitness market and have done that in the last year.
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Chapter 6: What prompted Venga to pivot into the fitness industry?
7% expansion gives them 102% net revenue retention increase. annually spending called a grand, uh, to get a new, a new $150 a month account. So that's about a seven month payback period. Pretty healthy team of 21 people in DC and other remote locations. Sam, thanks for taking us to the top. Thank you very much.