SaaS Interviews with CEOs, Startups, Founders
DevOps SaaS Data Tool Breaks $4.9m ARR Bootstrapped Using Its Marketplace To Grow
08 Sep 2021
Chapter 1: What is the significance of reaching $4.9 million ARR?
We are now actually doing 4.9 ARR on an annualized basis. So divided by 12, it's kind of like something like 440 or something like that.
It's like a big Excel sheet for all of these podcast interviews. Check it out right now at getlatka.com. Hey folks, my guest today is Pavel Dolezal.
Chapter 2: Who is Pavel Dolezal and what does Kabula do?
He's building a very cool company called Kabula. He helps companies utilize data to grow their profits faster. Pavel, are you ready to take us to the top?
Yes, Nathan, I am. Thank you for inviting me.
So it's Kabula. That's K-E-B-O-O-L-A, guys, if you want to follow along. Is this for marketers or developers?
Well, it's actually for developers. It's for people that today would be called data engineers or analytical engineers.
And where'd you get the idea?
Well, it's actually... It's kind of like scratching our own knee. So the company was actually founded over 10 years ago. It was founded by Peter Szymeczek, and it was a developer shop helping companies to migrate to cloud. And they noticed over time everybody wanted the same things regarding data, to integrate, to warehouse, to transfer, transform it.
And they just didn't want to do it again and again, doing the DevOps script. So they started to build an internal tool for automations. It was about 2015 when I met them. And I was like, guys, you know, this internal tool, this is, we should build a product company around it. So we got together, we, you know, like we, we actually rebranded Kaboola as a, as a product company.
It started to be like the name. So we kept it and we've been going on since. And how big was the agency in 2015? What was the agency revenue that year? It was actually, I don't really know, but I remember if I was like really small, it was like five, six people. So, yeah. Yeah, yeah, got it. I can dig it out. It was like 400k or something.
So what happened though? Did you buy the technology from them or are they still on the cap table or what?
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Chapter 3: What challenges did Kabula face when transitioning from an agency to a product company?
And about how much do they pay per month on average?
Well, actually, we split the customers into enterprise. Then we have SMBs. And in the SMBs, we also have growing startups. And then we have the Pay As You Go model, which is the product-led. And that's just starting. So all those 50... average around 3,000 ARR. And then the SMBs, they would kind of like be somewhere between 50,000 to 250,000.
And then we have a couple of enterprises and they are 350 North in ARR, not counting the services.
Sorry, I'm confused. So add it all up. How much MRR did you guys do last month?
Last month, we are now actually doing 4.9 ARR on annualized basis. So divided by 12, it's kind of like something like 440 or something like that.
420, 430. Okay, very interesting. And which segment is growing the fastest, pay-as-you-go, SMB, or enterprise?
Well, it's actually, for us now, it's the enterprise and it's the pay-as-you-go. And that's just, you know, we started to concentrate on pay-as-you-go. And that was really interesting because during the COVID, everybody told us you should actually open up the product like, you know, pay-as-you-go promotion. And we were like, okay, okay, we don't have time for it. But then we did.
And in the first six months, we got 900 projects started. And in July, we got 260 projects started.
So how do people pay as they go? Is it based on the number of minutes in the system? No, I know it's a credit card, but what's the utility value?
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Chapter 4: How has Kabula's customer base evolved over the years?
Well, actually, there are two reasons. First, I would say a lot of them are from our partners. who are actually doing implementation of Kibuwa and stuff. And sometimes they would need something, you know, and they would just like, it's our philosophy, like you shouldn't wait for us, right, to put it on the roadmap. You know, we do the core system, the platform.
So when they wanted something like special connector to Teradata, which they didn't like our default, so they would create that for their customers, right, and open source it. And then the second part, which actually is really interesting, people inside the companies actually create their own applications for internal use.
So, you know, that's how they productize the data because we see that, you know, data is not analytics only. You know, analytics is kind of like the first step, right? You want to look at the data, but then it's about the actions that you do with the data. You know, how do you write it into the places where you consume data, like CRM, Intercom, you know, everything?
And how do you automate use cases like customer 360 and stuff like that? So once they start doing that, they start actually write data into systems. They actually produce, put that in production and created new apps.
Yeah. Okay. That makes sense. Got it. So it's helping them build their own company. Maybe they run an agency, their customers need it. So they build the integration. Are they sticky? Pablo, these customers, what's the term look like?
Yeah, it's actually really interesting. You know, like until, until the last year, we pretty much didn't know, you know, like the turn. So it was actually very, very good. And,
last year we actually we until last year we had eight ten percent eight to ten percent and last year there was like 21 in the base of customers who either you know like like went bankrupt or or you know like totally scaled down their businesses or stopped for a bit of the year some of them i would say like 30 actually came back during last year but you know some of them went out of the business if you were a restaurant business in u.s
and you had 15 locations, COVID year hit you really bad.
You're talking 20% churn last year, is that right? Yeah.
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Chapter 5: What pricing models does Kabula offer to its customers?
How are you getting new customers?
Well, uh,
it was until until last year was mostly referrals people would you know know us you know they would use us somewhere they would go somewhere they would take us or they would recommend something like we have a we have a customer thomas trooper who is like super rock star in you know like he built a rohli group which is a billion dollar company you know out of czech republic they do groceries delivery within two hours and it is actually his third venture where he took us right so people you know take us with them
And during the COVID, we saw, you know, like how the world is changing. So we said, hey, let's accelerate that. You know, now is the time. You know, we have proven the product. People are happy with us. Now is the time to actually accelerate.
Yeah. Yeah. That makes a lot of sense. All right. What's next for the product? Are you planning to stay bootstrapped? Are you planning to raise capital or what?
Well, next for the product, from the product perspective, we are actually coming with some new features for more for the developers, you know, within DevOps kind of like pipelines. But from the company perspective, we are actually thinking, you know, what to do next because like we have now, we have cash, we have for foreseeable months and we are generating, you know, more and more money.
So we'll see, we'll see how it turns out next six months to be honest. You know, we got approached by a lot of people that, you know, like, Until now, we were comfortable with bootstrapping. If we see that we can deploy more capital than we actually have for market flow operations, we'll think about it then.
Of the $420,000 a month that you do, how much goes to the bottom line each month?
So if you say bottom line, you mean like all the expenses or do you define everything? Yeah. Okay. So, uh, uh, we, we actually, until last year, end of last year, we were profitable, like, uh, and we, we had like 600,000 profit.
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