Alphadoc Revenue, Valuation & Funding (2024)

hey folks my guest today is don stulk he joined tech as an intern in the payments industry and then developed an excellent instinct for learning what and is required for development processes he also learned what caused friction for developers and companies maintaining their documentation so today he launched alphadoc.io a developer experience platform to boost sales all right don you ready to take us to the top yes let's go all right so what does that mean a developer experience to boost sales um if you look at the market apis are everywhere and there's a lot of companies that are struggling with marketing their apis so um existing doc platforms they focus on providing a really nice documentation environment but getting customers into your api requires more than just great documentation it requires the whole experience and it requires that experience to actually convert people into users and building a platform that actually focuses on this is the the gap that we're trying to fill in the market and you sort of let people build these api almost glossaries general blocks diagrams api calls response and redirects all in one shot right yeah yeah so what we're doing is we're plugging into your source code into your open api spec and based on that you actually get the tools to uh quickly scale up your documentation so you're actually giving up all your flexibility uh which you're accustomed to with traditional doc platforms and we're giving you templates and frameworks and you can work with those so it gives you the benefit of not having to think about exactly how the doc portal should be structured um we've we figured that out for you all you have to do is fill in the blanks that makes a ton of sense okay when did you i guess before we get into the history here what are folks paying for this on average per month um it's not something that people are paying for yet where it's offering yeah well it's actually it's a private beta so um uh customers in the beta they're not paying today uh they will in the future but there's how many are in the data we have 10 that we're actively working with and we have um about 40 beta customers for what we're calling long-term opportunities they're saying hey i want to make the switch but i don't want to i need a bit more features than what you're offering in your mvp what are they switching from uh they're switching from platforms like readme gitbook their own open source tooling as well you said read me or reap me sorry read me uh dot io yeah it's uh doc's platform i see interesting okay so you've got 10 on the beta list now when did you start building this platform what year uh i think the the idea started in december 2020 and it actually started out as a completely different idea for the past i think up until january 2022 we were validating doing research so i think we spoke with over uh did interviews with over 60 60 companies and by now it's probably closer to 80 or 90 companies to validate what we're looking for so we started out with something completely different with an api demo platform but we click quickly learned that that's not what people are looking for at least not people that we were talking with they're looking for a way that actually makes it easier to build a developer experience and not just add more complexity we're trying to solve this problem where people are having issues with finding the right employees talented employees to help build out this developer experience there's just it's it's boring it's people would call it boring work yeah yeah yeah so how did you so how did you find these 10 folks that are in the beta today where did you find them uh we started with uh just our own network and the ball got rolling really quickly so we learned that on linkedin if and on twitter if you send the right message to other founders indicating hey i'm working on this business idea uh you're in the right space uh we'd love to get even 10 or 15 minutes of your time um uh people respond to it quite positively because people are is that the exact text that you use when you linked and messaged another founder no it's specific to the founder so it's it's tailored to what is the founder oh what's going on there youtube good to see you guys now imagine this you love watching these interviews with sas founders but imagine if we took all of the valuation data out from over 2807 interviews i've done manually saves you a lot of time well we've done this we've built it into the beautiful interface inside of founder path check this out i'll show you how you can access this in a second but you log in you connect your stripe account you see your valuation real time you can see what it changed over the past 88 days and even set goals for valuation this year now the secret evaluation is there's many different ways to value a sas business so the reason you're going to see three or four different valuations inside of your frowner path dashboard this is all free by the way is because depending on who's doing the buying of your sas company you're going to get a different valuation a vc is gonna pay a different valuation private equity firm is different if you're gonna do a minority sale that's different and if you sell the whole business that's a different valuation you can see all those when i hover over here right so the teal is what a vc would pay yellow is what private equity and red is if you sold the whole thing outright now what's cool about this is this is not built off random data again you guys hear these interviews on youtube all these datas are built from real time valuation data points founders share with us on the show so traction 1.2 million seed round 3.7 raised they sold 22 to their business go in here and filter by the event maybe you only want to see companies that have sold the whole business well here are a bunch that have been acquired the valuation and the multiple maybe you're going out right now and you're raising your seed round well go in here and look at all this recent seed deals that went down what they raised what valuation they raised at and what percent that they sold there's never been a larger data set of sas valuations than what you can get now inside of founder path and we're thrilled to bring it to you all right we're gonna go back to the youtube video here in a second but if you want to check this tool out if you want to jump in and sign up you can check it out for free to get your valuation at this link this link founderpath.com forward slash products forward slash evaluations or if you go to founderpath.com and hover over products click on get your valuation here and go ahead and sign up to give it a whirl again all that valuation data live right inside the platform i hope to see you there all right let's jump back into the interview can you read me one can you open your linkedin and read me one of the ones you did oh putting me on the spot here well cause copy's really important with this people get linked to messages all the day so when people say that we built this off cold messaging on linkedin people are going wait i never respond to linkedin messages what is what is don doing differently that i need to learn from you know yeah yeah so let me see probably gotta scroll and search a little bit right yeah uh [Music] okay so here's one where i actually used a mutual connection i said uh uh hey hey founder obviously use their name i think we know each other through mutual connection we both used to work at company xyz i just started as a documentation consultant to pay the bills while i'm building my own sales enabling docs platform probably interesting to do a call interesting i just realized actually that that's i i completely forgot about it but um when i started out i started out as a doc sales uh consultant so um i'm i'm what i'm my co-founder always says i'm the trojan horse so i reach out to companies or people come to me and say hey i need some help i need consultancy work on my docs platform so i i come in and i say how much money do you use what'd you make last year just on the consulting side of stuff uh i only ended up doing it for like uh for three days a week i only did that for three three months and i think that gave me enough runway to pay the bills for uh four or five more months so what is that like 20 grand you make or 10 20 grand something like that yeah yeah it's 30 grand that's what i made in those three months and i actually stopped doing it for this long because it's just too much uh work it's just way too too much effort so i'm only doing small projects now and it works because what happens is i come in first thing i say is hey i want to be super transparent i want to be as unbiased as possible but i can't because i'm also building my own docs platform and then people are immediately interested in what i'm building and sometimes it turns into something interesting and sometimes it doesn't sometimes i just act as a consultant that actually helps because it keeps me completely in sync with what's happening in the marketplace no it's a great way to keep your ear to the ground now have you funded the business uh yourself or have you guys raised capital we've raised capital so uh uh we've done a round with uh 15 uh sorry about my camera here we've done around with around 15 uh angel investors and when when did you close that round uh february and uh how much did you end up raising a quarter million okay got it by the way whatever's happening on your thing i your video looks fine to me so i wouldn't worry about oh okay okay yeah so so quarter million raised in a seed sort of a seed round obviously valuation and dilution management is important most people are selling like 20 in their seed were you sort of in that same range yeah fifteen percent uh okay so you were like what is that a eight hundred and fifty thousand dollar valuation something like that uh one one five percent uh so it's uh oh one point five percent no sorry fifteen one five percent yeah so that would be that would be about it oh oh oh god i got it got it so you you were like a 1.4 million 1.2 million valuations something like that free money two million two million valuation free money two okay so two million per e raised 250 you said yeah got it so so 250 divided by yeah okay you see 250 divided by 2.2 million would be 11 that you sold not 15 yeah sorry you're right it's uh uh it's eleven percent uh okay got it that's even better yeah yeah yeah that's even better how did you guys get i mean walk us through that negotiation a little bit how did you get to that valuation pre-revenue um we it was easy um we realized that a lot of the ideas in space they're not really based on tangible data right you can say oh i have a lot of better customers that are prepared to pay xyz but if you don't have product yet it's still not really based on anything so what did we do we said how much runway do we need how much percent of the business are we willing to uh uh what was the answer to that how much runway did you want yeah so we said let's get enough money to build an mvp with a small team of uh uh four or five people uh founders aren't getting a salary we're bootstrapping ourselves uh the whole point of the consultancy was that we don't take money out of the company and it also keeps us super eager where you know we're fighting every day to uh to build a company because so what is what is burn what is burn today then how much you burning per month uh we haven't started burn yet uh so we're just about to yeah we we uh we're about to hire our uh our first death and we've been working with some freelancers but those were one-off payments um so uh that actually keeps us really lean where did you find these freelancers and what did you have them do uh personal network we work with an amazing designer and um we have a freelancer that's working as a as a software architect so really helping us lay the the groundwork but uh this guy has a ton of experience uh does the designer is the designer looking for more clients can you share his name uh yeah he's on our website uh stefan uh stay from the e uh that's yi is his last name uh y e and he's on our website on alphadog if you go to the team page you can see his name so so we people could listening if they like your design and want to hire him part time could right he's or is he full time with you uh no no he's part-time with us i see i see well he did a great job the website looks fantastic um cool and then um sorry and then who what was the other one you said a software architect yeah yeah uh he's uh he's helping us out from uh architect's point of view and uh we just recently started working with them just uh two two or three weeks ago yeah he's not on the website yet right no he's not on the website yet very cool well listen go ahead uh no no sorry uh awesome well look what i was gonna say is no we're rooting for you let's wrap up here with the famous five number one what's your favorite book uh um secrets to sandhill road number two is there a founder you're following or studying no but sometimes i feel like i'm married to my co-founder mm-hmm so i know you're following him number three what's your favorite online tool for building alpha doc motion an automated uh task and calendar scheduler uh number four how many hours of sleep to eat every night uh seven to eight okay and what's your situation don married single kids one one baby on the way very crazy married and a kid very that's very exciting how old are you uh 29 29 last question something you wish you knew when you were 20. um uh go for equity at your first startup did you get screwed at your first startup no i did i don't feel like i got screwed uh uh but i should have definitely made a case for uh equity guys there you have it alphadoc dot io just raised 250 000 in their seed round at a 2.2 million valuation currently just two co-founders relying on freelancers to get the mvp up they help you build out your api documentation easier so that the develop developers are more likely to actually use your api again not a sexy states but definitely popular definitely needs work uh don is making this easy he supported himself last year doing thirty thousand dollars in consulting projects before saying okay i can now focus on the stats because he had enough personal runway again now scaling hopefully hiring three to four people this year to uh break out of beta and launch their first paid customer accounts we'll see what happens don thanks for taking us to the top thanks a lot one more thing before you go we have a brand new show every thursday at 1 pm central it's called shark tank for sas we call it deal or bust one founder comes on three hungry buyers they try and do a deal live and the founder shares back end dashboards their expenses their revenue arpu cac ltv you name it they share it and the buyers try and make a deal live it is fun to watch every thursday 1 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