SaaS Interviews with CEOs, Startups, Founders
1700 How A Bootstrapped $3m Revenue CEO Plans to Handle Virus, Potential Cashflow Issues
20 Mar 2020
Chapter 1: What is the current revenue situation of Badger Maps?
Badger Maps, they've added about $100,000 in MRR over the past year and a half, doing $350,000 per month in revenue. But they sell to field sales reps, and reps are not selling right now because of the virus. And we're worrying about cash in the bank and burn. And Steve has done a good job raising some debt capital to make sure that he's able to kind of get through this time.
Also planning for when customers email in and ask for things like... you know, pause the account or even cancel the account and what its response times look like.
Chapter 2: How is the CEO of Badger Maps responding to the impact of the virus?
So far over the past, call it week, two, three weeks, only about $1,000 in MRR loss out of its $350,000 a month base. Hello everyone, my guest today is Steve Benson. He's the founder and CEO of Badger Maps. After receiving his MBA from Stanford, he was Google's enterprise top sales executive in 2009. You can tell because he has perfected that wave.
In 2012, Steve founded Badger Maps, a software company that helps field salespeople optimize their routes and schedules to save time and be on time so they can sell more.
Chapter 3: What strategies are being implemented to manage cash flow during the crisis?
Steve, you ready to take us to the top?
Let's do it.
All right. I'm not going to beat around the bush or anything here, right? So last time you came on the show, you shared, you broke about $3 million in ARR. You know, you were serving 7,500 customers.
Chapter 4: How is Badger Maps adjusting its customer engagement during the downturn?
I believe those are actual salespeople inside of companies. So that's your user base. But it's to help them do field sales. No one's driving around doing field sales right now. As a software CEO, how are you responding to the virus?
Well, you know, so I think that we're one of those companies that will be affected by this because of the service that we provide, you know, helping field salespeople go and meet their customers. So dentists, for example, right now aren't, they're probably not buying a lot of new fake teeth or new tools or new medical devices.
And so our customers, the people that go and sell that dentist, that type of stuff, they probably don't, they're not getting meetings. They're not out in the field. some software companies will be impacted differently than others. I mean, obviously, if you were Zoom, then more people need your stuff right now. But for us, definitely, there's going to be
Chapter 5: What lessons has the CEO learned from previous business experiences?
there's going to be a downtrend in demand for our products, at least for the short term here.
And so many CEOs right now are thinking about things like how much cash do I have in the bank relative to my runway if I get no new revenue? Should I plan for three months? Is this going to be a quick turnaround? Or should I plan for like seven or eight months? Is it going to be a little bit longer than everyone expects? What are your thoughts?
Well... I think that the more cash you have on hand right now, the better off you are.
Chapter 6: How does the CEO plan to pivot the business model during this time?
And, uh, you know, just hunker down and make the product great for when you come out on the other side, um, and, and kind of turn the focus to that on the sales and customer success side. I would say people, at least what I'm thinking about is how do I make the customers that I have more successful? How do I keep them extremely happy? Um, and, uh,
And how do I find new customers who maybe are in a slightly different area than I was working with before the crisis started? So can I pivot to a slightly different customer set that is going to have great needs going forward for this, or even short-term needs while this is happening? So an example there for us is doctors, nurses, other services that go to people's homes that
helping them organize what they're doing on a map. So they're not, you know, historically we helped salespeople do this, but we've had, we've, we've run into companies like this before where a hospital group is doing a bunch of home visits. And so they'll, they'll have their doctors or their nurses organized using our tool.
So that's where we're going to be looking for to pivot towards things like that and bring in new business from that instead of to make up for the lost business in other places.
So when you did come on last, that was October 29th of 2018, pre-virus, so three, four weeks ago, what did you grow your customer base to?
Well, and nothing's, not a lot has changed for us. I think we've lost about a grand in MRR so far. But we're at about 355 right now in MRR.
And how many customers is that?
Whatever that is.
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Chapter 7: What are the implications of taking on debt for a SaaS company?
Um, probably 8,000, 9,000. Um, I don't, yeah, I, I don't tend to count the, the absolute numbers. We were in an interesting position because we have kind of like a B2C business and a B2C business, B2B and B2C, which is a little weird because an individual can use us for their job.
Um, and so they behave very much like B2C customers, but then a lot of our customers are, it's a large company or a team. that is using us for their entire sales team. And so they behave obviously much more like a B2B customer. MRR is much more important than the absolute number of customers.
Well, yeah, still good growth, right? About a year and three months ago, again, you had about 250,000 in MRR. You've added 100 grand in new MRR since then, or 1.2 million in ARR. If you're up to 9,000 seats now, that's 9,000 seats. Field sales reps paying 40 bucks-ish each per month, so it's nice growth. As you're thinking about...
so i mean one of the things if i was in your shoes that i would be making plans for is will i see a massive cancellation spike or massive like hey steve you like email steve can we pause our account for three months we love you but can we pause for three months while we figure out what we're doing like how are you are you getting those and if so how do you handle that so i'm i'm expecting those i haven't gotten many yet i mean it's still early right i mean it
Chapter 8: What advice does the CEO have for startups considering debt financing?
I don't know when this will publish, but it's March 17th right now. So like San Francisco was just locked down and, you know, kind of people aren't supposed to go to restaurants or bars as of, as of yesterday. So that's kind of where we're at right now. So I haven't seen a ton of that yet. I think, so I just had a conversation with my VP of sales about this.
um, this morning actually is how, how do we, how do we respond to those, those calls of people quitting? And we haven't had many, but I, I think that the, what we landed on was when an individual calls, we should, we should offer them half off for three months.
Um, if they called to quit, um, offer them half off for three months and then, um, and then, and, uh, and see if they do that instead of quitting. And I think the reasoning there is then, you know, their stuff's not all deleted. It's still in the system. It's, it's, uh, they don't have to reset anything up. We don't have to reset them up, which is, which is good for us.
So it's, it's kind of a win-win for everybody. Um, for, for larger companies, I think, you know, I don't think what we would feel like the B to the B to B side of the business, um, which is bigger than the B to C. Uh, I don't think we would do that because, you know, company, you know, just like we,
Just like we're going to, you know, just like we have to batten down the hatches that other businesses need to too. So, um, but I, so I think that's the key question, right?
That's the key question is when everyone has this internal dialogue of what their version of batten down the hatches means, you hope that, and whoever's listening, you hope that your piece of software is one of the things that makes like that, that, that makes the cut that is critical that they can't do without. Right. And that's the question is what's critical and what's not.
I don't know how deep people are going to have to cut. I think when businesses get in situations like this, they make a series of cuts. They trim off a little flesh and then they go a little deeper and they go a little deeper and eventually they hit bone. It'll likely be a fairly painful process for a lot of businesses in the world. Some are already in deep trouble immediately, obviously.
You're a A bar, bars are, if you're a bar in San Francisco, the bars are closed. Your revenue just dropped to zero.
Let's give more people more color on how you've built the business to date so they can figure out kind of, hey, am I in Steve's shoes as well? So you're a bit unique here in that. You've done, I think, a great job scaling a company, you know, basically bootstrapped, right? So to date, how much equity have you raised?
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