How Appknox CEO Harshit Agarwal grew Appknox to $4M revenue and 76 customers in 2024.

hey folks my guest today is harshad agarwal he's the co-founder and ceo of appnox and is also a tech enthusiast he's a serial entrepreneur and is also part of several startup communities his several years of startup and tech experience set the way for him to co-found the company in 2013. the company focuses on being the world's most powerful plug-and-play mobile app security testing solution used by enterprises around the world harshly you ready to take it to the top okay so when you say mobile security mobile app security testing is this literally a mobile app that does security testing or enterprises use this to test the security of their mobile apps so it's a later uh enterprises companies use our platform to secure their apps on regular business i see and so i guess help me understand i guess pricing model what are they paying an average month to use your technology yeah so it depends on per app majorly we target enterprises that have got outputs of 10 20 or even 100 of mobile apps and uh for them the majority of challenges that every app is going out for releases and the release cycle is reducing nowadays to even a week and with that kind of release cycle it becomes difficult to test every app and with that big enterprise they cannot uh let it go without security testing that's where we step in we automate we speed it up we make sure that it can be part of their normal development life cycle and the app can go secure well that makes tons of sense but so i guess give me an average or a sweet spot so between 10 and 100 mobile apps what's the average customer pay you per month to manage whatever the average is 50 apps 30 apps whatever average is 20-ish 20 000. no so yeah per customer it's roughly around twenty thousand dollars but uh when i said 10 200 i mean number of apps so there are enterprises who have got efforts of 100 apps i'm talking about fortune 500 companies we've got multiple brands internal external apps then there are some of the companies who are very much focused on single uh vertical for them it would range from five to ten apps so pricing for us varies for these companies starting from seven to eight thousand dollars can go up to fifty thousand dollars a per year per month per year got it so starting point is sort of seven eight thousand a month but your biggest customers will pay you know or sorry seven eight thousand dollars per year and your biggest customers might pay what over a hundred thousand a year if they have hundreds of apps yeah okay is that accurate do you have customers paying more than a hundred thousand dollars a year we have a customer who's paying us efforts of 250 000 a year wow can i don't obviously don't mention who they are but can you share how many apps they manage on your platform 600 mobile apps ah okay and is this like can you sort of describe who they are without naming them is it sort of like a restaurant brand with like a bunch of local apps it's it's an fmcg world's biggest fmcg brand what is that unilever i can name it uh so they have office of 600 mobile apps that that is spread across the globe uh and they have applications focus on region specific and different places so yeah that's very interesting okay put the stuff on a timeline for me when'd you launch the business what year so we started in 2014 our product was launched in 2007 uh 16. it took us almost two years to build a product and bring it up to a speed where customers could use it and we have been in business since 2016 so two years to build the mvp pre-revenue you've got to pay yourself somehow did you have a bunch in savings or did you raise a bunch of capital or how did you fund your growth or your so we raised the uh capital uh we had raised our initial round in 2000 uh around the end of 2014 itself we had raised 750 000 dollars a precedent round from singapore based venture capital uh and that's the only round we have raised suppose that i think you have been revenue positive we have been going on revenue 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 going to pay a different valuation private equity firm is different if you're going to 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 so you haven't raced since then no yeah that's awesome uh most folks in their precede round are selling you know 20 to the business what valuation did you raise the 750 000 at roughly around 4.3 uh mil valuation that was roughly around the seminary free money or post money post money okay so something like sort of a 3.5 million pre something like that yeah interesting and looking back would you have done the same thing again was that a fair amount the fair valuation i i i personally feel that at that time it was not really really required for us to raise funds uh uh we could have delayed it a little further and trace that better valuation overall uh because majorly i think we had to test our mvp and all of that we could have done it a lot cheaper and a lot earlier basis i think that is the learning we had over a longer period uh after two years also once we released the product it was not really focused on right customer segment and that that whole thing happened after 2018 when we hit a roadblock where we didn't have funds we were about to shut down and we had to go back to our drawing board and go go and go and understand everything again so so from that whole learning experience if i would have done it again i would have not raised funding that i would probably have raised a little later when i had clarity on what metrics i could grow on with that fund how could i use it and uh get the maximum roi well tell me what happened in 2018 how low did the bank account get uh we only had a one month runway and how much money was that though that was roughly around thirty thousand dollars uh in our bank account and uh we had a team of roughly around 22 members and we were clueless on what we should do we we just went to our blackboard we had account receivables of around one to two months but but again that's not in the bank so next month we don't know how we'll pay salary what was revenue in 2018 do you remember we're roughly around 220 000 uh dollars 220 yeah per year oh yeah okay got it so doing about 19 18 thousand dollars a month in mrr yeah interesting so so so the good point was that we had paying customers who are paying us roughly around that eighteen thousand dollars so the next good thing same thing we did was we just had to relook at the team and just have team members who are very very critical and we brought down our cost to 17 18 000. from there we have grown organically we have made sure that we don't we are overall not revenue negative uh sorry the cost negative overall it's it's on positive side uh whatever we are doing and then slowly we've grown now we have a decent runway plus everything sorted things are really growing we are investing we are investing more than what we should but all on the revenue...