Zapier at 100,000 Paying Customers and $50M ARR — and the ARPU Wade Foster Never Doubled

Nathan Latka opens with a revenue number and gets corrected inside twenty seconds. “You did announce, I believe you passed about $35,000,000 in AR, that was in September 2018?” Wade Foster: “We passed 50,000,000.”

That exchange sets the pattern for the whole interview. Almost every figure in it arrives one of two ways: Foster states it plainly, or Latka derives it out loud from GetLatka’s own database and asks Foster to agree. Those two kinds of number do not carry the same weight, and the ones people quote from this episode — three million subscribers, a doubled customer lifetime value — are both of the second kind.

The business Foster describes

Asked how the company makes money, Foster gives the plainest possible answer:

Zapier helps people be more productive at work by helping them connect all the business tools that they use. So if you use things like Slack or Gmail or Dropbox or Mailchimp or QuickBooks or Salesforce or any number of 1,400 apps you might be using in your work. We help you build automations and connect them easily. It’s a freemium service so you can get started for free. And then we have monthly subscriptions.

Wade Foster, CEO and co-founder, Zapier

Freemium, monthly, self-serve. Foster is explicit that enterprise money arrives through the same front door as everyone else’s: “We do have customers across a Fortune 500 broadly. So we have lots of enterprise usage, but it’s very much a bottoms up product driven sale.” The GetLatka headcount rows from 1 December 2018 put a number on what that means internally — 58 engineers, 9 in marketing, and three people in sales at a company doing $50M a year.

Where the “3 million” comes from

The three million is real, but it is not subscribers and it is not Foster’s. It is a line in Latka’s scripted introduction: Zapier is “a workflow automation tool used by over 3,000,000 people to connect the work apps they use every day.” People who use it. On a product whose first sentence out of the founder’s mouth is that you can get started for free.

Foster’s own number lands four minutes later, and he is careful with the qualifier. Latka asks where the customer count sits now, having cited about 60,000 at the October 2017 appearance. Foster: “We have over 100,000 paying customers today.” The gap between the two figures is a factor of thirty, and it is the difference between a usage statistic and a revenue statistic.

30×3,000,000 people using Zapier, per Latka’s intro, against 100,000 paying customers, per Foster

The ARPU exchange, in full

Here is the second half of the headline, and it is worth reading the sequence in order rather than the summary of it. First Latka reads the database figure back to Foster:

Latka: ARPU is still about $20 on average?

Foster: Yeah. We’ve raised it quite a bit. So we’re doing a little better than that, but in the ballpark.

That is the entirety of what Foster says about revenue per customer on this tape. Raised it quite a bit; a little better than $20; still in the ballpark of $20. Several minutes later, Latka comes back to it with arithmetic:

And north of 100,000 customers and $50,000,000 in AR, I mean that would put your kind of ARPU more like 40 or $50 a month versus 20. I mean you said slightly more, that’s like doubling. Is that accurate? Yeah. Okay. I mean, that’s — you’re not giving yourself enough credit here. You’re a humble guy. But I mean, that’s like doubling ARPU is a big deal over just eighteen months.

Nathan Latka, host

The “Yeah. Okay.” in the middle is the only thing on the tape that resembles a confirmation, and both machine transcripts of this recording keep it inside Latka’s own turn rather than marking a change of speaker. Even read generously as a one-word assent from Foster, it is followed immediately by Latka telling him he is not giving himself enough credit — which is the host arguing against the guest’s own estimate, not the guest revising it. Foster’s next turn changes the subject to growth levers. He never restates the doubling in his own words, and he never corrects it either.

Both ends of the “doubling” are the same division

The arithmetic is easy to reproduce, which is what makes it worth checking. GetLatka records Zapier at $14.4M in revenue on 26 September 2017; Latka cites about 60,000 customers at the October 2017 appearance. Divide: $240 a year, $20 a month. That is where the $20 in his question came from. Now do it again with the current pair — $50M across 100,000 customers — and you get $500 a year, a little under $42 a month.

ARR ÷ customers ÷ 12 = revenue per customer per monthNot the same thing as a measured ARPU: it averages annual and monthly plans, free-to-paid conversions mid-year, and every account that joined halfway through the period.

So the doubling is not two measurements eighteen months apart. It is one calculation performed twice, on two revenue-and-customer pairs, and the input Foster actually commented on was the output of the first one. His answer — a little better than $20, still in the ballpark — is what he had to say about the whole exercise.

The eighteen months is loose too. Latka says “over just eighteen months” mid-interview and “over the past eighteen to twenty four months” in his own outro, and the baseline he is measuring from is the October 2017 episode.

And ARPU is not lifetime value

Even taking the doubling at face value, it is a claim about revenue per customer per month. Customer lifetime value is that figure multiplied by how long customers stay and adjusted for what it costs to serve them. Foster gives no lifetime figure, no gross margin, no expansion rate and no cohort curve on this tape.

The one retention number he does confirm is a churn figure, and it is logo churn, not revenue churn: Latka asks whether Zapier is still under the “less than 5% logo churn per month” he quoted last time, and Foster answers “Yeah, that’s right. More or less. Yep.” That is a monthly account-loss rate at a company selling $20-ish monthly subscriptions to small businesses. It is a real number, and it is not a lifetime value.

What Foster says is actually moving the number

Asked whether the ARPU rise was intentional, Foster gives an answer that is the opposite of a growth-hack story:

As you age, as companies tend to age, ARPU tends to go up if you have a good mechanism where people start to use the product more. So those older cohorts start to use the product more, get more value out of it. They upgrade to bigger plans and they start to pull your ARPU up just as a business as a whole.

The mechanisms he names all serve that one idea — make the product cover more of what a customer already does, and the customer climbs the plan ladder on their own.

• Ubiquity of app coverage — “when we support the things that people use, then Zapier becomes useful for them. If we don’t support the tools that they use, then Zapier is not useful for them.”
• Internal utilities — filters, formatter, code steps, delay steps, scheduler, email parser. Foster calls them “a modern Excel macro” and says nobody arrives for them but people stay for them.
• New-app partnerships — Airtable as the standout, plus Front, Discord and Squarespace opening its ecosystem, all added in what he calls recent history.
• Lifecycle email — the “this Zap stopped working” nudges Latka says he has reverse-engineered as a customer. Foster: “I don’t think we’re doing a good job at this. I think there’s a lot more we can do to improve on this over time.”

His method for finding the next app to support is the funniest admission in the tape, given how publicly contrarian he is about venture capital: “it’s not too different than perhaps like a VC might approach things. You’re trying to pay attention to are they hiring more people? Is there traffic going up? You can look at like Alexa rankings and stuff like that. Did they raise some money?”

A million dollars raised, eight of the first ten still there

The capital story is the part of this episode that needs no arithmetic at all. Latka: you’ve raised very little capital, less than a million, correct? Foster: “Yeah, yeah, right at 1,000,000.” The early investors are still on the cap table, Y Combinator among them, and Foster says he is happy with that.

GetLatka carries $1,362,949 in total funding for Zapier, against a single priced round: TechCrunch reported a $1.2M seed in October 2012. Foster’s “right at a million” is his own rounding of the same event, not a second number.

• 2011 · Founded Foster and two co-founders start Zapier; he confirms the year on tape, and gives his age as 32.
• Oct 2012 · Seed TechCrunch reports a $1.2M seed round, the company’s only priced round; GetLatka carries $1,362,949 in total funding.
• Oct 2017 · 60,000 customers the figure Latka cites from Foster’s previous appearance, against a $14.4M revenue row recorded 26 September 2017.
• Dec 2018 · 194 people GetLatka’s headcount row, of whom 58 engineers, 9 marketing and 3 sales.
• Early 2019 · 100,000 paying customers and $50M ARR, 200 people, still no office.

Even the $50M has two dates attached to it. Foster states it in the present tense in an interview recorded in the first months of 2019 — Latka frames the whole conversation around “the growth strategy ideas blossoming in Wade’s head for 2019” and asks what surprised him “last year” — while Latka’s own outro back-dates the milestone to September 2018 and GetLatka’s revenue row carries it at 1 September 2019. The company crossed $50M somewhere in there; nobody on the tape is precise about when.

On the company itself, Foster is precise. A hundred percent remote, no office, about a third of the team in engineering and another third in support, onboarding and customer enablement. “Of our first 10 employees, eight are still here.” His argument for remote is not the rent: “the big benefit you get out of remote is you have access to a global talent pool. So you can hire anywhere.” And it makes management honest, because the evidence of work is in the artifacts rather than the room — commit messages, ticket queues, specs. In an office, he says, “you kind of kid yourself that you’re doing a good job at management, where you’re like, oh, I see them sitting there. I smiled at them. I gave them a compliment over lunch. Like, all is good.”

Added after publication: which recording this quotes

GetLatka’s archive holds this conversation twice. The two transcripts are the same interview — the introduction, the ARPU exchange, the country music interrupting Foster’s audio and the closing Famous Five all run word for word in both — because the episode was re-cut and re-uploaded years later with a new host monologue bolted onto the front and a new title: “24 Year Old Makes $1 Billion By Sending This Text Message.” That billion appears nowhere in the conversation underneath it. The quotes above are taken from that later, cleaner transcript of the same recording, because it is the one machine-transcribed with speaker turns.

A re-cut is also how a recording loses its date. This one has been filed against 2014 as well as 2019, and the tape settles it on its own contents: Zapier was founded in 2011, and in 2014 it was nowhere near 100,000 paying customers, $50M in ARR or 200 employees.

The fence

Latka ends every episode with the same five questions. Asked what he wishes his twenty-year-old self had known, Foster — the founder who took under $1M and stayed remote while everyone told him not to — answers against type: “I wish my 20 year old self was a little more open to hearing the advice from others. You mentioned I’m a bit of a contrarian at times. I think my 20 year old self probably took that a little too far and I probably could have done a better job at listening.”

Then he explains the idea he uses to decide when contrarianism has earned itself:

If you move into a neighborhood and there exists a fence that you don’t like, an ugly fence, and you want to take it down, before you take it down, you should figure out why the fence exists in the first place. If you understand the reasons for why the fence existed in the first place, then feel free to go take it down. But if you don’t understand yet, you should probably not take it down quite yet. … But until you reach that point, you might want to reserve judgment.

Wade Foster, CEO and co-founder, Zapier

Sources Wade Foster interviewed by Nathan Latka, recorded early 2019; GetLatka company data for Zapier — revenue recorded 26 September 2017 and 1 September 2019, headcount recorded 1 December 2018 and 1 January 2019, total funding $1,362,949; TechCrunch, 31 October 2012, on Zapier’s $1.2M seed round.