SaaS Interviews with CEOs, Startups, Founders
773: Can $1m MRR Company Grow Into $10m Post Money Valuation?
05 Sep 2017
Chapter 1: What is the main topic discussed in this episode?
Three years ago, he launched the company, did very little revenue his first year, 2014, actually zero. 2015, did 155 grand. 2016, grew to 550 grand in sales. He's now doing, last month, 80 grand in monthly recurring revenue. Each customer, which there's 20 of them, pays about four grand. Again, he's helping these customers like Zendesk more effectively do account-based marketing.
Super healthy unit economics, just did his pre-series A, raising $2 million on a $10 million post-money valuation.
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 twenty thousand dollars per talk five and six million he is hell-bent on global domination we just broke our 100 000 units sold mark
And I'm your host, Nathan Latka. Many of you listening right now don't have time to listen to every B2B SaaS CEO that I've interviewed. If you want to get access to the database I've created with year-over-year growth rates, customer accounts, margins, and many, many other data metrics and data points, you can go to getlatka.com. Here's the thing, though. This database... I keep it to myself.
It's so freaking valuable.
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Chapter 2: How does Venkat's experience influence Mariana IQ's growth strategy?
And to preserve the quality of the data and make sure that the people that have access to it have a true advantage, I'm only letting 10 companies on each month. So we're full this month, but you can go to getlatka.com to get on the waiting list for next month. And look, there's big people on the waiting list. I mean, the biggest VCs you've ever heard of. You've probably heard of them.
They're big, private equity, billions and billions under management. So it's an impressive waiting list. Go get on now at getlatka.com. This is episode 773. Coming up tomorrow morning, I talked to CreativeLive's Chase Jarvis, and I said, if LinkedIn offered you $200 million, would you sell CreativeLive? His answer will surprise you. Hello, everyone. My guest today is Venkat Nagaswamy.
He is the CEO of Mariana IQ. He brings a long and diverse background in high technology to bear on applying artificial intelligence and deep learning to help marketers make account-based marketing an at-scale reality.
Chapter 3: What are the revenue milestones Mariana IQ achieved in its early years?
Big Cat, as he was nicknamed by his friends and colleagues, has led his teams in creating analytics, technology, and business development solutions at McKinsey, Juniper Networks, and GE Plastics, among others. He's worked within enterprise and digital consumer hardware, SaaS, corporate and business unit strategy, market entry strategy, product development, along with many, many other spaces.
He's a proud graduate of the University of Michigan and the Georgia Institute of Technology. He also holds an MBA and a master's in aerospace engineering. Venkat, are you ready to take us to the top?
Yes, sir.
Okay. So that was a mouthful, but thanks for joining. Tell us what Mariana IQ does and how you make revenue.
Okay. So the problem that we're looking to fill is the problem that I faced when I was at Juniper trying to implement ABM or account-based marketing. The key problems that people have when trying to implement account-based marketing is how do you figure out which accounts to go after? How do you figure out who within the account to go after? And how do we engage them?
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Chapter 4: How does Mariana IQ help clients like Zendesk improve their marketing?
How do we capture them through multiple channels? And that is the problem that we're looking to solve. How do you figure out which accounts to go after? Let's find the specific people within those accounts and surround those individuals on various channels like Facebook, Twitter, Google AdWords, and so on. And that's what the software does.
People buy a subscription, a monthly subscription to the software, which allows you to run campaigns targeting the same set of individuals on all of these different platforms.
So it's a SaaS business model.
It's a SaaS business model. Okay.
And what do people pay on average per month?
So right now, we're doing about $4,000 a month on an average per customer.
Okay.
Got it. And then give me more of the backstory here.
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Chapter 5: What unique marketing strategies did Venkat use to attract customers?
So what year did you launch the company in?
Yep. So I started this company, what, three years ago, along with two of my co-founders. Prior to that, I used to run enterprise marketing for Juniper Networks. And so I come at this as a user of the technology, not just from the technology side. And back in the day, I implemented what was then the latest greatest in marketing analytics, which was
And I felt that there was still a whole bunch of tools that marketers needed to be successful. And my co-founder also felt the same thing, having done product marketing and product management. And that's how the team came together.
So that was 2014, about three years ago when you launched. Do you remember what your first year revenue was?
The first year revenue was zero. I mean, we started making our first revenues in late 2015. We did for the year of 2015, we did $155,000. In 2016, we did about $550,000.
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Chapter 6: How does Mariana IQ's customer acquisition cost compare to its lifetime value?
And hopefully, we'll do four times that this year. We'll see.
Are you on track to do $2 million this year?
So I'm trying to do the math in my head, but it saved me the time.
So what was monthly recurring revenue last month?
So last month it was 78, 80, about essentially tracking close to a million in ARR.
So you did about 80 grand last month, multiplied by 12, gets you to about a million dollar run rate.
Yep, that's basically it.
Got it. So with a $4,000 ARPU and 80 grand in MRR, you have what, about 20 customers?
Yep, yep. It's actually slightly more than that, but yes.
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Chapter 7: What insights does Venkat share about raising capital for startups?
That's really, really helpful. You took us up, you have 20 customers. Tell us a story about one of these customers, like how they're actually using you, a real name.
Yeah, so Zendesk is one of our foremost customers. As you know, Zendesk is a big player in SaaS world and they're well known as a good B2B marketer, especially inbound marketing. They came to us saying, hey, we're doing great in inbound marketing, but we need to target larger companies and go after a list of accounts which are larger than what we normally do.
And so they gave us a whole bunch of that historical data. We used our AI platform to find more companies like the ones that they were successful with and found more people within those companies that we found that they were successful with. And we created this audience for them on Facebook.
They've been running campaigns on that for the past 10 months or so, and they've had great success, right? To put this in context, these guys are people who spend something like 50 bucks a click to all the way up to 100 bucks a click on Google AdWords for something like help to software, and they were able to increase their lead volume like four times based on Mariana.
while holding the cost, while improving their success rate. Now, they didn't tell us how much their success rate improved by because we would then increase the prices.
Hell yeah, you would.
But they said it improved, increased their quality.
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Chapter 8: What advice does Venkat give to aspiring entrepreneurs?
So we got better quality, four times the volume while keeping the cost the same. That's great. Because of this AI that underlies what we do.
And have you bootstrapped this company or have you raised capital?
We did raise capital from first. We did a seed round in 2014. Bloomberg Capital led the round, and we also had prominent angel investors like Gokul and Rajaram.
Did you say Bloomberg Capital or Bloomberg, like Michael Bloomberg?
It's Bloomberg. It's B-L-U-M.
Who's behind that?
So David Blumberg is the main guy. Bruce Tarragon is the guy on my board. He's my man.
Got it.
These guys were behind. I mean, they've been around for 30, 40 years. They were the original investors behind RSA, Hootsuite, Nutanix. These are some of the names that you might know.
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