SaaS Interviews with CEOs, Startups, Founders
Mozart Helps You Clean Your Data, $0 to $750k ARR in 12 Months, $6m Seed
05 Feb 2022
Chapter 1: What is the main topic discussed in this episode?
Peter, 40 customers at that ARPU earlier, the median, you called it a grand. It means you guys are doing about $40,000 a month right now in revenue? Well, I think it would be a little bit more than that, right? So we are doing a little bit better than that. You are listening to Conversations with Nathan Latka, where I sit down and interview the top SaaS founders, like Eric Wan from Zoom.
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My guest today is Peter Fishman. He has over a decade of experience running data and data adjacent teams at companies like Microsoft, Yammer, Opendoor, Platinum, and Ease. He realized that building the same type of modern data stacks at each company, which was obviously a pain in the butt, was the opportunity that he's building today. Mozart Data. They launched in 2020.
It makes it easy for anyone to set up a modern data stack without a data engineer in under an hour. That's a big promise. Peter, are you ready to take us to the top? Let's do it. What does a modern data stack look like today?
A lot of folks know the individual piece of a modern data stack, but what a modern data stack is, is it's centralizing your data without sort of requiring a lot of data engineers. Give it a face though. Name a couple of tools today that people would like stick in a data stack. I would like to think Mozart data is the tool that besides your own, come on.
Uh, but, uh, but beyond that, uh, people know EL tools like five train and stitch. Um, people are certainly familiar with data warehouse options. Uh, the, the biggest and baddest being snowflake, but also, uh, Google big query or, or Amazon redshift. Um,
And then people also think now about transform and they think of it in many different flavors in terms of observability, data governance, a lot of BI tooling, a lot of reverse ETL. So really it's about taking data from the silos in which it gets generated and turning it into something useful at the end, which is generally a chart that people will then take action on.
or sending it back into a system that people use out in the field and operationalize. And Peter, when folks are signing up for this and paying you, what are they, I mean, community service suite, so what are they paying on average per month to use your technology? Sure. So, you know, our ACB is around $20,000, but the median is around $1,000 a month.
So people are, you know, people are essentially, you know, from that getting data infrastructure. So data infrastructure can be, you know, 10 years ago would take, a number of data engineers, and a very big check to one of the big tech companies to get started. Today, not just with our tool, but with many tools, you swipe a credit card and you're off to the races for as little as, say, $6. Yep.
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Chapter 2: How did Mozart Data start and what problem does it solve?
Is it accurate? It ended up being actually $6 million through a seat extension. And you said non-traditional. What was non-traditional about how you did it? Um, so in, in, in so far as that it was in, in steps.
So typically when you think about like an extension or a bridge, you're talking about a company that's on its like, uh, sadly, like its last legs and trying to figure out a way to get to that next round. And when we did it, we did it a little bit opportunistically.
Um, just because, uh, I think the market for, for, you know, data tooling is, is certainly the investor market for, for data tools is, is really hot. I'd argue it's very advantageous to always have an open round. That means anytime you meet someone you think can help you and they say, I'd love to put money in, you can say, yes, the docs are ready.
The thing's thing that is boom, boom, sign the docs and you can get them in. Versus if you're closed, you got to spin up a whole new process. It's a lot. You say, wait to our series A, right? Then you lose them. Right. Sure.
Chapter 3: What is a modern data stack and why is it important?
The difference between, you know, raising like on a signature versus, you know, if you're raising a price round, you know, there's an official close date, there's, you know, lining up, you know, all of the terms and all the like, not just of the term sheet, but of all of the sort of legalese that goes back and forth about edge cases.
So, you know, obviously, if you're an entrepreneur, you get into the business not to argue about sort of the edge cases of what happens when you fail. You instead only really want to think about, you know, how to make your business better and, you know, how to get that capital efficiently. That's right.
Now, most folks in their seat around these days are selling between sort of 10% and 20% of the business. Were you guys sort of in that same range? Yeah, I think you... You have to sell a meaningful chunk of your company and your efforts over the coming years when you're raising and you don't have too much to show for it.
The short version is you can bootstrap a company and that's always impressive. But then you can also take the gas fuel and try to capitalize on a market opportunity that you see. So yeah, we were selling what feels like, in hindsight, a large chunk of our company. Yeah, you're talking like six on like a 35 or 40 pre, something like that. Yeah, I think.
And then, you know, valuations change rapidly at the early stage.
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Chapter 4: What tools are essential in a modern data stack?
So a hint of traction is really incredibly valuable. So it is the case that like, you know, I think. You can think about pre-product and the team and raising on your resume and your network, and then thinking about having a product and being able to go into a pitch meeting just with a demo as opposed to a deck.
In fact, we didn't really raise with a deck just because I think now people really are most interested in seeing what it is that the product does. Yeah, exactly. 100%. Yep, yep, yep. So talk to me about the traction. Do you remember how you got your first customer? Tell us that story. I mean, you always remember your first dollar. Tell me.
So first off, I'll say that my co-founder and I, this is our second time doing a company together. So 10 years ago, we started a hot sauce company together. And I don't remember really just our first sale, but I remember our first sale to somebody that didn't have one of our last names. That was a really special moment for us. Now, in the data space, I don't sell to my parents.
So, uh, you know, our first customers unsurprisingly came from our network. It was folks that wanted to not just use, you know, our product as a modern data stack, but actually really have the high touch experience of working. Who was it though, Peter? Can you name them? Are they, are they okay being public? Yeah. I mean, we, we talk about these companies all the time.
So in, at the end of Y Combinator, uh, we, we made three sales and we left Y Combinator with three sales. So, um, that was Tempo, um, and Rippling were sort of the two largest. And then Gaia GPS was another sale. So we made three sales during Y Combinator. So one per month. So actually not that impressive, but you can think of it as infinity percent growth.
But yeah, those three, we sent out the invoices at the same time. So technically, I think the first Stripe payment came from, I believe the answer is Tempo, but now I'm embarrassed. I bragged about remembering the first dollar In reality, it's just an electronic transaction. So I didn't actually receive that fistful of cash. Fair, fair, fair, fair. Okay, fast forward today.
How many customers are you working with now? Yeah, we're working with a few dozen, almost 40 customers. And obviously, that spans a variety of sizes and stages and industries. We're not specific to B2B or B2C. Peter, 40 customers at that ARPU earlier, the median, you called it up a grand. It means you guys are doing about $40,000 a month right now in revenue?
Well, I think it would be a little bit more than that, right? So we are doing a little bit better than that. Haven't hit the magical seven figures of ARR. Come on, you've got 10 days left. Can you break 83 grand a month and give them 10 more days?
I like to think of it, by the way, I take the challenge on very seriously, but I like to think of the opportunity as our fiscal year end in January 31st. So give me 41 days and we'll see if we can make it. Do you guys care about valuation right now, specifically your valuation? Do you think you might raise soon or sell a portion of the company?
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Chapter 5: What is the average cost for customers using Mozart Data?
That's plural forward slash valuations. Again, both plural founderpath.com forward slash products forward slash valuations. So maybe your average in it is not $1,000 a month. It's maybe more like $1,500, $2,000 a month. And you're more like $60,000 or $70,000 in total MRR. You quoted the median.
So just like in many things in stats, we're definitely a case where you have some companies that are six-figure companies. So the average looks a lot higher than the median. We really do aim to service the small company that's just trying to get started in their data journey. But then we hope to service them as they become... unicorns, decacorns, et cetera.
We have a number of companies that have become unicorns while they've been Mozart customers. We like to call that causality in practice. Of course, 100%. That's the only reason they're a unicorn now. I'll go with maybe. Maybe. The statistician in me is like, maybe. Yeah. And Peter, help us understand growth rate. If you're on 60, 70 grand a month today, where were you a year ago? You remember?
Sure. You know, in general, we've been growing 10% month over month, which is basically a seven month double time. So, you know, when you're in YC... Hold on, Peter, you got to make this simple for my honest. You were doing about 20 grand a month a year ago. Yeah. You know, we left YC with only 20K, but like, yeah.
So if you kind of think about us as having done, you know, over, you know, a number of doubles in the last year, you know, we had fewer than 200K at
uh you know at the sort of yeah if you double if you doubled your revenue from a year ago twice you went from 15k to maybe 30k then 30 doubled up to north of 60 at this point i think that probably is on on track that's about right yeah um okay cool tell me more about the team how many folks today we are 22 people wow how many engineers uh we're uh we're basically 12 technicals 12 okay pretty good what do the other 10 do um you know we do sales and marketing uh we you know i'm
I think a big part of SaaS, we do have a GTM. We don't call it sales and marketing. We call it GTM. And then on top of it, we have a lot of customer support. So folks that are that are helping teams get up and running. One of our business models is similar, I call it like superhuman, where we love to give people a push in the back.
So superhuman in order to use essentially their email interface, you know, they make you get on a 15 minute call with them so they can explain a lot of their functionality. We like to do the same. We think that really the hardest challenge in data is just getting started. So having sort of an expert by your side to make that start happen, we think is really valuable to our company. So a lot of
Our motion is not just about new ARR, but actually expansion ARR as companies really get their data systems going. How many CSM reps do you have today? We have zero that have that title, but we have three folks that have data analytics experience. Okay. And how many are full-time sales reps today with a quota at the company? So we have a sales team of five. They all carry quota?
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Chapter 6: How did the company raise funding and what was unique about it?
Why didn't you join Mode instead of launching Mozart? Well, so it was a very tough day for me. Both Derek, Josh, and Ben, the three co-founders, walked into my one-on-one with Derek and explained that we're not going to have the one-on-one that they were leaving in a handful of weeks to go start Mode. I said, oh, man, what am I doing?
But I actually really loved the challenges that I had at Microsoft at the time and spent my time on a number of different Microsoft products, got to touch billions of users, have that larger company experience. Your options did pretty well. I don't know what you're talking about. All right. Mode's your favorite tool. Okay. Number four, how many hours of sleep do you get every night?
I'm a five or six hour person. Not because I'm uh, like grinding the midnight oil as a startup founder, but because I've always sort of been able to oddly exist off of five or six hours of sleep. And what's your situation? Married single kids. I recently got, uh, engaged. Uh, my partner works, uh, across the street, uh, not in tech, but as a news reporter. So cool. Okay.
So any kids or no, uh, we have no kids. And how old are you, Peter? I am 41, 41. Last question. Something you wish you knew when you were 20. Um, uh, Well, there are many, there are many things like I want to kind of like go back and like in like Back to the Future 2 style bet on every like subsequent Super Bowl or winning.
But, you know, in general, I would say, you know, it's kind of okay, the ups and downs of a career. So sort of having kind of that perspective on sort of nonlinear progress being a reality of life and careers. And, you know, it's not about sort of getting there kind of first or fastest, but sort of enjoying the ride in a cliched way. Guys, there you have it.
Messy data to analysis ready very quickly. They launched in 2020. They're a COVID company. About $15,000 a month in revenue a year ago. Now $70,000 a month. Not reinventing the wheel here. They charge on compute and number of rows. 40 customers to date. About a $6 million seed round. Caught like a 30 to 40, maybe $50 million valuation when they did that. But team of 22 today scaling quick.
12 engineers, five on the sales team scaling nicely. Peter, thank you for taking us to the top. Thanks so much.
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