SaaS Interviews with CEOs, Startups, Founders

750: How to 3x Customer Revenue, Be More Than Just Document Signing

13 Aug 2017

34 min

5947 words

3 speakers

13 Aug 2017

Audio

Description

Mikita Mikado. He's the CEO of PandaDoc, a company founded to accelerate the way organizations transact. He's an entrepreneur, engineer, and executive focused on creating self-sustaining companies. Famous Five: Favorite Book? – Pitch Anything What CEO do you follow? – Satya Nadella Favorite online tool? — Google Calendar How many hours of sleep do you get?— 8 If you could let your 20-year old self, know one thing, what would it be? – Mikita would tell himself that he doesn't have to focus on making so much money and just focus on learning as much as he can Time Stamped Show Notes: 01:24 – Nathan introduces Mikita to the show 02:03 – Jared Fuller was in episode 193 of The Top and is still part of PandaDoc 02:25 – PandaDoc helps organizations the way they transact 02:39 – all kinds of transactions 02:52 – PandaDoc focuses on deals that have substantial value and paperwork 03:06 – PandaDoc can build proposals, quotes, contracts and close deals in a digital fashion 03:30 – PandaDoc's RPU has increased since last year 03:56 – Annual deals 04:10 – Average customer pay 05:10 – PandaDoc gets most of their customers from word of mouth 05:32 – Using SEO to expand operations 06:15 – PandaDoc gives their small customers templates that they can use in their deals 06:58 – The marketing team finds keywords that are most popular and relevant to them 07:20 – They use Moz and other tools to find keyword 07:59 – PandaDoc isn't built on top of PDF 08:03 – The templates from PandaDoc are in HTML and not PDF 08:41 – QuoteRoller was the first product that was launched in 2011 08:56 – Pivot to PandaDoc at the end of 2015 09:06 – Team size is now 106 09:23 – The last year total raised was $4.5M in cash and $2M in debt 09:41 – Currently, debt has been paid 09:50 – Total amount raised is $19.5M 10:17 – PandaDoc has more than 7K customers 10:30 – 2 different cohorts of customers 10:55 – PandaDoc has a legacy product and a new product 11:22 – Gross churn is satisfactory 11:50 – From last year's revenue churn, it was 9% 13:21 – Some inbound marketers use PandaDoc to close a deal then will stop using it 13:50 – 5% monthly logo churn is high for Mikita 14:38 – PandaDoc has around 100 team members and 2 are focused on target customers 15:13 – CAC and LTV varies 16:00 – Mikita is trying to get under 12 months of payback period 16:29 – Fully weighted CAC can be $1200 16:48 – How Mikita assumes CAC 18:47 – The industry's rule of thumb for payback period is 1.13 of ACV or 14 month payback period 19:05 – PandaDoc has channels with a payback period of 6 months and 2 years 19:29 – PandaDoc has an outbound sales team that is their delta force 19:54 – The outbound sales team finds the industries that PandaDoc should target 21:05 – Paid spend total is under quarter of a million 21:19 – PandaDoc is closed to hit a million in MRR 22:08 – "We want to make an impact" 22:22 – This is a horizontal product 23:47 – PandaDoc focuses on workflow and the actual collaboration on the workflow 23:58 – "We want to system of records for deals or transaction" 24:05 – PandaDoc isn't going to the CRM space 24:18 – Mikita has been in the CRM space before 24:43 – One of the challenges of CRM now is the emergence of AI 27:12 – Mikita's consideration on price of acquisition 30:20 – The Famous Five 3 Key Points: Create a product that can serve a different market and fill the gap that the others haven't seen. Let your goals guide you, but also keep in mind that having a business means being responsible for your employees. Multiple revenue cohorts will lead you to multiple marketing and sales strategies. Resources Mentioned: The Top Inbox – The site Nathan uses to schedule emails to be sent later, set reminders in inbox, track opens, and follow-up with email sequences GetLatka - Database of all B2B SaaS companies who have been on my show including their revenue, CAC, churn, ARPU and more Klipfolio – Track your business performance across all departments for FREE Hotjar – Nathan uses Hotjar to track what you're doing on this site. He gets a video of each user visit like where they clicked and scrolled to make the site a better experience Acuity Scheduling – Nathan uses Acuity to schedule his podcast interviews and appointments Host Gator– The site Nathan uses to buy his domain names and hosting for the cheapest price possible Audible– Nathan uses Audible when he's driving from Austin to San Antonio (1.5-hour drive) to listen to audio books Show Notes provided by Mallard Creatives

Chapters

1. What is the main topic discussed in this episode? 2. What is PandaDoc and how does it help organizations transact? 3. What strategies does PandaDoc use to acquire customers? 4. How does PandaDoc increase its Average Revenue Per User (ARPU)? 5. What is the significance of customer acquisition cost (CAC) for PandaDoc? 6. What is the role of the outbound sales team at PandaDoc? 7. How does PandaDoc handle customer churn? 8. How does PandaDoc differentiate itself from competitors in the document signing space?

Featured

Nathan Latka

Mikita Mikado

Unknown

Transcription

Chapter 1: What is the main topic discussed in this episode?

0.031 - 19.963 Nathan Latka

with quote roller now obviously building panda doc they launched that back in you know called 2011 panda doc really coming out a few years after that they've grown their team from 65 people about a year and a half ago to over 105 they've raised additional capital from 6 million now over 19.5 million more importantly though they're now serving 7 000 customers right helping them

Chapter 2: What is PandaDoc and how does it help organizations transact?

19.943 - 34.42 Nathan Latka

With all these different workflow management tools, whether it's, you know, you know, payments or document management or document signing or pitches and updating pitches quickly. Those 7000 customers are paying on average about 100 bucks a pop. So call it 700 grand in MRR.

34.74 - 41.868 Nathan Latka

Gross churn is high, logo churn is high, but that doesn't really matter for them because they've got a great job at doing driving expansion, ARPA and expansion revenues.

Chapter 3: What strategies does PandaDoc use to acquire customers?

41.888 - 63.498 Nathan Latka

They have a net negative revenue churn, which is great. This is The Top, where I interview entrepreneurs who are number one or number two in their industry in terms of revenue or customer base. You'll learn how much revenue they're making, what their marketing funnel looks like, and how many customers they have. I'm now at $20,000 per top. Five and six million.

Chapter 4: How does PandaDoc increase its Average Revenue Per User (ARPU)?

63.638 - 71.449 Nathan Latka

He is hell-bent on global domination. We just broke our 100,000-unit sold mark. And I'm your host, Nathan Latka.

71.429 - 100.575 Nathan Latka

this is episode 750 coming up tomorrow morning we learn from mark chung he's an internet of things electricity measuring king he's raised 16 million dollars and just passed 1.2 million in revenue so how's he doing it hello everybody my guest today is makito makado he's the ceo of a company called panda doc a company founded to accelerate the way organizers transact organizations transact he's an entrepreneur engineer and executive focused on creating self-sustaining

100.555 - 105.369 Nathan Latka

Makita, are you ready to take us to the top? For sure, Nathan.

Chapter 5: What is the significance of customer acquisition cost (CAC) for PandaDoc?

105.57 - 110.565 Nathan Latka

All right. I am doing very well. You're laughing, so you're in a good mood today, right?

Chapter 6: What is the role of the outbound sales team at PandaDoc?

111.153 - 112.275 Mikita Mikado

I'm always in a good mood.

112.555 - 115.82 Nathan Latka

That's the right answer. Tell us why you're in such a good mood.

Chapter 7: How does PandaDoc handle customer churn?

115.94 - 125.493 Nathan Latka

What does PandaDoc do and what's your revenue model? And then we'll move on quickly, guys, because we actually had Jared on back in episode 193.

Chapter 8: How does PandaDoc differentiate itself from competitors in the document signing space?

126.334 - 129.439 Nathan Latka

And Makita, is Jared still there? And what is his role?

130.44 - 133.084 Mikita Mikado

He is still there. Okay. He's the core of the business.

133.604 - 135.387 Nathan Latka

So he's kind of head of operations?

136.048 - 136.148

Yeah.

136.313 - 142.984 Nathan Latka

He runs sales and BD. Sales and BD. Okay, perfect. So yeah, what's your version? What does PandaDoc do and what's your revenue model?

144.006 - 176.073 Mikita Mikado

Sure. We help organizations to accelerate the way they transact with electronic quotes, proposals, contracts, signatures, and... recently payments. That's essentially what we do. I think about the world of all kinds of transactions, the cheap products and services are being taken over by e-commerce, by two-sided marketplaces. And where we focus is basically deals that have a substantial value.

176.554 - 193.677 Mikita Mikado

Deals that require some kind of paperwork, That's where we come in. We digitize this paperwork, allow sales teams to build beautiful proposals, quotes, contracts, and close the deals in a digital fashion.

194.758 - 207.715 Nathan Latka

When Jared came on, this would have been about a year and a half ago, in February 2016, I believe, he told me that your guys' kind of ARPU monthly was around $30. Is that still the same, or has that increased or decreased, and why?

208.167 - 217.742 Mikita Mikado

Um, it increased, uh, it increased dramatically. And, uh, um, I think it was actually higher a year and a half ago.

SaaS Interviews with CEOs, Startups, Founders

750: How to 3x Customer Revenue, Be More Than Just Document Signing

Chapter 1: What is the main topic discussed in this episode?

Chapter 2: What is PandaDoc and how does it help organizations transact?

Chapter 3: What strategies does PandaDoc use to acquire customers?

Chapter 4: How does PandaDoc increase its Average Revenue Per User (ARPU)?

Chapter 5: What is the significance of customer acquisition cost (CAC) for PandaDoc?

Chapter 6: What is the role of the outbound sales team at PandaDoc?

Chapter 7: How does PandaDoc handle customer churn?

Chapter 8: How does PandaDoc differentiate itself from competitors in the document signing space?

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SaaS Interviews with CEOs, Startups, Founders

750: How to 3x Customer Revenue, Be More Than Just Document Signing

Chapter 1: What is the main topic discussed in this episode?

Chapter 2: What is PandaDoc and how does it help organizations transact?

Chapter 3: What strategies does PandaDoc use to acquire customers?

Chapter 4: How does PandaDoc increase its Average Revenue Per User (ARPU)?

Chapter 5: What is the significance of customer acquisition cost (CAC) for PandaDoc?

Chapter 6: What is the role of the outbound sales team at PandaDoc?

Chapter 7: How does PandaDoc handle customer churn?

Chapter 8: How does PandaDoc differentiate itself from competitors in the document signing space?

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