Auvenir Revenue & Valuation (2024)

hello everybody my guest today is pete myers with 17 years of ex leadership experience under his belt uh and a ted rogers mba specialized in management of technology and innovation he's currently ceo of avenir a deloitte venture that is assisting small to medium audit firms leverage technology to enhance the capabilities of cpas in the financial audit industry pete are you ready to take us to the top yeah absolutely how are you doing i am doing well so what does deloitte venture mean from a cap table perspective so deliverance uh we're owned by deloitte is the the very simple uh aspect of it so deloitte has uh suited this and uh got this uh venture off the ground so so how is deloitte so lucky to lock you into their company where you don't you like why not you just go do your own thing you know 100 and build it yourself you're doing all the hard work yeah so there's a good opportunity the um the connection with deloitte gives us opens a lot of doors uh allows us access to a global market very very quickly it also gives us access to um some deep thought thinkers in um in order um i think wherever you get uh backing into any any venture that you do um it's all about it's not about cash it's all about the um what else they bring to the table cash for a good idea cash comes easily it's the um it's the the other things that they bring that uh is important so was this a spin out or like you were you built this by yourself they bought it and now you're working on iron out or something uh so it's somewhere in the middle so it's uh it's a startup that was um seeded by them so um so i came so at the very beginning or inception above near uh deloitte was uh part of that but it was not i was not from deloitte prior i was an independent uh person doing the my own thing and then got uh started this off with deloitte that's interesting partnership from day one but um it's neither a spin-out nor a an acquisition interesting okay so you launched the company deloitte is one of the early investors how much how much capital has the company raised to date um so there's something we're not disclosing at the moment so um i'll leave that one off okay is it all is it um is it all strategic from deloitte or have you raised traditional vc so it's all strategic investments okay okay so yeah well that makes sense why you wouldn't want to wouldn't want to release that then and so it's closed yeah yeah yeah no problem okay good all right so okay launch the company um walk us through again for people that are not familiar with kind of auditing and these kinds of things walk us through what the company does and are you a pure play sas company yeah so we're designed to set up as a platform the idea here is um within the audit business there's not a huge amount of technology available today and the technology that is available has often gone into silos within that space so what we're doing is uh building a platform that pulls together uh technology the best in class technology and um and providing it to the audit firms in a seamless solution so it's a platform play where we want to partner up with the best in class of technology that can be applied to the the audit space okay but is it sas i mean are you charging a monthly recurring fee for this sorry yes the the business model is a sas model so you're charging per user per month i see and you're selling directly to the the the firms or some intermediate area that then sells to firms so selling directly to the firms at this point very cool okay so give me a general sense i mean are you are you perfect you know for you know one kind of user firm or a 10 000 person firm what's the general kind of size company paying you per per year per month yes we've uh specifically targeted the small medium-sized accounting firms the firms that are they're not big enough to have their own technology department and build their own technologies they're dependent on third-party tools so these firms can be anything from a one-person shop uh through to um some of them are quite sizeable with you know 10 20 partners you know up to 500 uh employees type things so there's a full range in there but specifically targeting the the smaller end of that market okay and yeah just because we don't have time to go on every cohort i i do understand that you have multiple cohorts but when you talk about like your sweet spot are those kinds of people you're targeting i mean are we talking like 50 bucks a month or 500 or 5 000 a month or you know i mean generally where do you fall in terms of pricing uh so we've got uh two products here so we've got a basic product which is the engagement management and where we're falling with pricing there is is very uh it's at the cheaper end of the scale so we're talking uh ten dollars per user per month for that uh uh cheapest product okay and then the um the more advanced features when you get into automation and it's taking a good chunk of the workout that's where it becomes more of a premium product okay if we though so you're giving me the pricing on a seat basis but i don't know when you say small firm i don't know how many seats you're assuming a small firm has so like at a s at a logo level at accounting firmware are these people paying like 100 bucks a month for 10 seats typically is that a good starting point yeah so that the average would be about that so you're talking about that size firm so anything down to one seat um and then uh going up so that's really that would be the average that's really helpful to understand okay good really really good there thanks for that um you're founded when you found it uh 2016. okay it was 2016. and what i mean where was your head at this point did you just quit corporate and say i'm going to go into the most exciting space ever accounting yeah and i i've done so my backgrounds um been a number of different benches some with exit some without um the failed type um but we've um in in starting this so started off as a bit of an experiment um so this was uh working with deloitte but experimenting this space seeing if there's there is an opportunity in space what we quickly found was there's a real appetite and hunger for these small firms they just don't have access to that technology today and nothing nothing's really meeting their needs so there's this very strong appetite which sort of drives us to then create credit as a company and uh start commercializing the solution why not i mean i guess you said the reason you did the delay deal because it was very very strategic was that just too much you didn't see any downsides like for example there's a lot of other big firms that probably don't use you now because you are very clearly and obviously a deloitte company yeah so there's always an upside and downside what we're facing here is uh those that compete with deloitte tend to be the largest firms i mean deloitte really sees themselves competing with the other big four um in that space um so when we're talking about selling this technology we're not selling to those uh big players but then the technology that we're selling is really targeting the small small in the market so it hasn't created any uh blockers at the moment um and in fact many of these uh smaller firms appreciate the fact that delete's giving something back to the profession so they're doing something that's benefiting the small firms as well and and how many of these small accounting firms are using you now today um so we're in a beta stage at the moment so we've got a small handful that are using on a regular basis giving us feedback we're looking at um doing a full launch in 2019 to uh to scale are you talking like maybe like a dozen a handful yes we're looking at uh two dozen at the moment is um and keeping it small because of the uh keeping the feedback uh manageable feedback loop tight totally get it yeah so 24 of these small guys paying 100 bucks a month that means you know again you got to start at zero but you're at now about 2400 bucks a month something like that yeah so we're definitely in the i would say the very early stages there um and this is where we'll uh we'll be pushing the launch in 2019 and uh we'll be going through the typical valley that you go through where um trying to turn it from uh being a cost to uh starting to get that revenue um by the way i don't see it as i don't see it as a valley i see it as this is where everyone starts so i like to quantify it because people shouldn't be shy about this everyone starts at zero so this is great um so 2400 today and then a year ago nothing i assume right yes a year ago would be yeah that would be nothing or next to nothing like negligible yeah yeah and then okay good so so funded really from deloitte and then team size today about how many people so we've got 30 people here based in toronto okay we leveraged many others outside of that but yeah 30 base here okay then there's i mean with 30 people then i mean we're not talking about a small amount of capital coming into the company then i mean to support 30 people with very little revenue i mean this is a big investment for deloitte correct yeah yeah yeah how do you um how do you make i mean as an entrepreneur starting a company you have a fiber about you which is freedom and go go and when people think deloitte i don't think they think freedom and fast mover typically now it could be wrong but like how do you make sure you stay nimble inside of such a big animal yeah so i think the the key here is not to be inside the animal so we've been set up as a separate entity external to deloitte we're um in our own office in our own space we've got our own hr system where we're completely independent in that form so it's the idea here is to um to keep it at arm's length and uh keep it the relationship in his investment relationship not as a um being pulled into the firm yeah yeah very good all right uh let's wrap up here pete with the famous five number one what's your favorite business book so that would be upstarts is the one that i'm reading i can't remember how many have read but uh upstairs is the one i'm going through at the moment which is uh number one about uh their disruption there is there a ceo you're following or studying uh there's many um so both uh so there's uh mark from uh from salesforce there's uh brian helgen hubspot um jeff bezos of course is a a shake remover there's there's a number that i'm following there number one what's your favorite online tool for building the company um so the online tool that we're using uh i mean we're using a whole number but uh atlassian tools is uh probably one of the fundamental pieces number four how many hours of sleep to get every night uh maybe six of them lucky okay and situation married single kids uh so married with a kid okay and how old are you i'm 38 38 last question last night what do you wish your 20 year old self knew um i i mean one of the key things in getting ahead is being adaptable so it's not necessarily learning a skill but learning to pick up skills very quickly so whatever path you've gone down it's definitely going to change guys be adaptable be nimble launched avenir back in 2016. now about 24 beta customers paying 100 bucks a month really just starting took a big strategic investment by deloitte well obviously use it as a distribution channel when he moves to really launch it in early 2019. they are bootstrapped now outside capital although significant capital being invested via deloitte to support their team of 30 based in toronto as they look to sail as they look to help small and medium-sized accounting firms really automate and drive more value to their end customers in a quicker more effective fashion pete thank you for taking us to the top fantastic thank you very much nathan