How Brainboard Reached $40K–$50K in Monthly Revenue and 10 Paying Customers in 2022 (Interview with Founder Chafik Belhaoues)

Introduction and What Brainboard Does

Nathan Latka

00:00Hey, folks. My guest today is Chafik Belhaoues. He's the founder of brainboard and former CTO of Scaleway, the French cloud provider. He's an engineer with fifteen years of experience in building infrastructures at large scales and solving problems. Now building brainboard.co, visually build and manage your cloud infrastructure. Chafik, you're ready to take us to the top? Yes. Okay. Tell me who's paying for this. Who's paying for your tool today?

Chafik Belhaoues

00:22>> So the customers that we have are mainly cloud architects. I mean, when I say cloud architects are engineers building infrastructures inside companies. So because, you know, just to give an overview of these people, as an engineer with like, the brainboard comes from our own frustration. So we got a lot of tools to deal with infrastructures, and we got a lot of cloud services. And engineers struggle between both of them and glue the different tools and processes

00:55>> to make things work inside companies. So brainboard, make it easier. You got a one unique platform where engineers can build their infrastructures.

Nathan Latka

01:05Interesting. Okay. And and what do they pay on average to use a tool per month?

Chafik Belhaoues

01:10>> Yes. It's per month. The the pricing plan is per user per month. So So we want it to be predictable. You know, one of the pain points now using the cloud is the cost and the prices are unpredictable. You know, when you use cloud infrastructures, you do not know how much we're gonna pay. And we want to do it the other way around. It's predictable. It's paid per user per month and simple and easy.

Nathan Latka

01:31So, Chafik, when you look at all your customers today, what's the average company paying you per month, would you say?

Pricing: $12K–$15K per Customer per Month

Chafik Belhaoues

01:37>> Yeah. The average company is between 12 and 15 k a month.

Nathan Latka

01:41Okay. Okay. So you're in enterprise sales motion then?

Chafik Belhaoues

01:44>> Yeah. We can say it's still SaaS. We're not in that enterprise module. It's still SaaS, but it's between twelve and fifteen ks.

Nathan Latka

01:53Well, yeah, you can be SaaS and selling to enterprises. I'm just saying your price point is high where it's an enterprise sales motion.

Chafik Belhaoues

01:59>> That's true. Yes.

Nathan Latka

02:00Interesting. Okay. Put this on a timeline for me. When did you launch the business?

Founding Timeline and Launch

Chafik Belhaoues

02:04>> We launched it in 2019. So actually, we started working on 2019 and we launched in January 2020.

Nathan Latka

02:13Okay. And how did you fund yourself between those twelve months when you had no revenue?

Early Self-Funding and Path to Fundraising

Chafik Belhaoues

02:18>> Yeah, this is an interesting question. Is our own funding. So I founded brainboard with my co founder Jeremy. So we, yeah, we were self funded and we stayed like that for almost two years. Then when we realized that we got a lot of traction, we got paying customers, and we said, Okay, now it's time to move on. And we we raised fan fans last year.

Pre-Seed Round Details

Nathan Latka

02:45Okay. So in 2021, raised how much did you raise in 2021?

Chafik Belhaoues

02:48>> We raised we raised more than 1,200,000 USD.

Nathan Latka

02:53Okay. And would that sort of your seed round or pre seed?

Chafik Belhaoues

02:56>> Yeah. We call it pre seed, pre seed round. So this is like to build the first team and, yeah, get the first team to build the product for enterprises. So that's why we call it pre seed, but not seed yet.

Nathan Latka

03:09Awesome. And how did you manage dilution? What what cap did you raise at or what valuation did you raise at?

Valuation and Dilution

Chafik Belhaoues

03:13>> Yeah. This is yeah. One of the biggest questions, you know, when you start fundraising is economics and control. And we we The valuation, it's is more than 4,000,000. So

Nathan Latka

03:24Post post money or pre?

Chafik Belhaoues

03:26>> Pre money.

Nathan Latka

03:27Pre money. So 5.2 post.

Chafik Belhaoues

03:30>> Yeah. Something like that. I mean, had ASOPs and so on, but this is something small.

Nathan Latka

03:35Yeah. So you sold about 20% of the business, something like that.

Chafik Belhaoues

03:38>> Yeah, not that much, but close to that.

Nathan Latka

03:42Yeah. Very cool. Now, you mentioned you guys funded it yourself at the beginning. How much of your own capital did you put in?

Chafik Belhaoues

03:49>> Actually, we put it We had like more than 150 ks.

Nathan Latka

03:52Wow.

03:53And what oh, so 300,000 total.

Chafik Belhaoues

03:57>> Yeah.

Nathan Latka

03:59Oh, what's going on there, YouTube? Good to see you guys. Now imagine this. You love watching these interviews with SaaS founders, but imagine if we took all of the valuation data out from over 2,807 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 Founderpath. Check this out. I'll show you how you can access this in a second, but you log in, you connect

04:22your Stripe account, you see your valuation real time. You can see what it changed over the past eighty eight days and even set goals for valuation this year. Now the secret evaluation is there's many different ways to value a SaaS business. So the reason you're gonna see three or four different valuations inside of your Founderpath dashboard, this is all free by the way, is because depending on who's doing the buying of your SaaS company, you're gonna

04:46get 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.

Chafik Belhaoues

04:59>> Right? So

Nathan Latka

05:00the 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 founder share with us on the show. So traction, 1,200,000 seed round, 3.7 raise. They sold 22% of their business. Go in here and filter

05:24by the event. Maybe you only wanna 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. We'll 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 dataset of SaaS valuations than

05:49what you can get now inside of Founderpath. 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 wanna check this tool out, if you wanna jump in and sign up, you can check it out for free to get your valuation at this link, this link, founderpath.com/products/valuations. Or if you go to founderpath.com and hover over products, click on get your valuation here, and

06:14go 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. Alright. Let's jump back into the interview. How did you guys get that money? Were you guys, like, rich or you you cut your parents are wealthy or what? You had an early exit or in high school or what?

How the Founders Funded Themselves (French 60% Scheme)

Chafik Belhaoues

06:30>> None of that. You know, we got a we we were based in France and we got a system in France. You know, when you work for more than six years, you can you can take like two years off and you got all 60%, something like that, of your salary. So we took advantage of that. We used it to fend ourselves, which means we had like 60% of the former salary to fund ourselves for two years.

Customer Count and YC Traction

Nathan Latka

06:58I see. I see. Okay. That makes sense. Talk to me about customers today. How many customers are paying you?

Chafik Belhaoues

07:04>> Yeah. We do not have a lot of customers now. We are just starting. So we have like more than 10 customers. And we joined YC a month ago, I mean, two months ago. And we are noticing a lot of increase in the users that we have and increase of the paying customers. So the first, we got a few customers that we have more than 10, and we're seeing growth coming. And we've got a few interesting customers

07:34>> that we are talking to, prospects that we are talking to, that we hope will close in the near future, in the next coming days.

Nathan Latka

07:41That's awesome. I mean, can I take 10 customers times the ARPU you told me earlier of 12,000 a month? You guys are doing about $120,000 a month right now in revenue?

Chafik Belhaoues

07:49>> Yeah. Not exactly that, but something similar because, you know, we have kind of discount for the first customers because they accept to test the product, give us feedback, so it depends. But this is like the pricing power, we can say, basket

Nathan Latka

08:03of But what are you actually doing right now in terms of MRRs?

Chafik Belhaoues

08:07>> Is more like a $100,000?

08:09>> Yeah. Not that bad. That much. Lower? Thousands.

Monthly Revenue: $40K–$50K

Nathan Latka

08:13Yeah. So I asked you earlier what your average price was. You said $12,000, but if you have 10 customers today, then you have $120,000. So you're lower because you're onboarding people, you're just getting started. I get that. But what is monthly revenue today? Is it like more like $40,000 to $50,000?

Chafik Belhaoues

08:28>> Yes. Something like that. Yeah.

Discounting Early Customers

Nathan Latka

08:30I see. I see. Okay. So how do you think about discounting these early folks? You're giving big 60% discounts?

Chafik Belhaoues

08:37>> It depends. It depends on the customer and the number of seats they take. You know, as we price per seat, so like for a customer taking 50 seats, it's not the same thing for a customer taking five seats. So what we usually do, we apply between 15 and 25%. And yeah, but in return, we take either engagement for a year or they accept to give us a regular feedback like we do with them regular points like meetings, either

First Customer Partnership

Chafik Belhaoues

09:07>> once a month or once each two weeks. So, it depends on how we work with them. And some of them, like, they propose for us to be partners with. So we started this partnership. We didn't have thought about it at the beginning, but now as we're seeing people and companies asking for it, so we started our first partnership a week ago.

Nathan Latka

09:31Very cool. Okay. So this makes sense. So if you're doing about $40,000 a month today in revenue, where were you a year ago so we can calculate growth rate?

Chafik Belhaoues

09:39>> I mean, in 2023?

Nathan Latka

09:42No. A year ago.

Revenue Growth from a Year Ago

Chafik Belhaoues

09:43>> A year ago. A year ago, we were, like, hundreds of bucks. We were like 200 a month. Yeah. Because we hadn't that much customers because we didn't do any sales actions. So we started really sales actions in the last five months actually.

Nathan Latka

10:03I see. So this is interesting. A lot of people struggle going to market and selling high priced things to enterprise as their first 10 customers. How have you been able to do that? I mean, that's not easy. Are you reaching out to them on LinkedIn? How they finding you?

LinkedIn Cold Outreach Sales Strategy

Chafik Belhaoues

10:17>> Yeah, this is a good question, Yela. You mentioned LinkedIn. Yes, LinkedIn is working a lot for us. I mean, actually, because, you know, we are talking to experts, cloud architects and managers, and these people are present in LinkedIn because they work with LinkedIn. You know, when you are looking for a job, you put it on LinkedIn. When you got promotion, you put it on LinkedIn. And like LinkedIn works, that is the most, we can say, useful

10:44>> channel for us. And, just to answer your question directly, because, you know, we are in an existing market. The cloud market is more than 300,000,000,000 in revenue in a year. So and these, like, these companies are already paying a lot for the cloud providers. So what we offer is we offer to them to save money and time for their engineers. But what does

Nathan Latka

11:14the LinkedIn you have to get their attention. So what does the initial LinkedIn message sound like? What's the job title you're targeting, and what's the text or the message sound like?

Chafik Belhaoues

11:21>> Yes. So what what we ask first is feedback. So this is our strategy, and we are honestly looking for feedback.

Nathan Latka

11:29Yeah. But but, Chafik, make that real for me. Right? You're you're reaching out to someone you don't know on LinkedIn. If you just say, give us feedback, they're not gonna reply. What does the message actually sound like?

Chafik Belhaoues

11:38>> Actually, this is work. This is what we do.

Nathan Latka

11:41Your text literally says, give us feedback period. And you get replies.

Chafik Belhaoues

11:45>> Not that feedback period, but you say, I I'm interested in your feedback in a tool that I created that solves ABC.

Nathan Latka

11:53What is ABC?

Chafik Belhaoues

11:54>> ABC is solving, designing cloud architecture, designing and building and managing cloud infrastructures.

Nathan Latka

12:04Okay. And do you give them any what's the next step? What's a call to action? A phone call, a Zoom call, an email?

Chafik Belhaoues

12:09>> They first start by testing the product, then we suggest, like So so you

Nathan Latka

12:15you say you say click here to sign up to test the product, and they'll go sign up.

Chafik Belhaoues

12:19>> That's true.

Nathan Latka

12:20Okay. And then what?

Chafik Belhaoues

12:22>> And then they test the product, and and they come back to us with lot of feedbacks. Then we can schedule a call. We can so usually, we schedule a demo because they see a part of the product, but not the entire product. So we schedule a demo to show them how things work. And we talk to them about their pain points, about how they work, the things they want to accelerate in their process. And we try

12:49>> to match the value we provide with their way of doing things.

Sales Process: POC and Decision Maker Engagement

Nathan Latka

12:54Okay. And when do you tell them the big thing? You say it's time to start paying. It's $4 a month. How do you get them to start paying?

Chafik Belhaoues

13:01>> Actually, yeah. This is like sales now we enter in the sales process, the classic one. Like, we talk to decision makers. And as we have an approval like, our strategy strategy is bottom up. So we talk with the users once it's validated. When we talk with decision makers, it's easier. We say, your users is using the product. They're satisfied. This is how it costs. We can start a POC with you, this is how we do it

13:29>> usually. We start POC for fourteen days. They are happy. They validate, and they they How

Nathan Latka

13:35much does the POC cost?

Chafik Belhaoues

13:37>> POC is free. We do it for free.

Nathan Latka

13:39Okay. And then what happens at the end of fourteen days?

Chafik Belhaoues

13:42>> So they either buy or not.

Nathan Latka

13:44Got it. But they know going into the POC what the cost is gonna be at the end of it. So they they you set the expectation.

Chafik Belhaoues

13:51>> That's true. Like, for example, you take 10 users, it's gonna cost you 12 k a month a year, and this is predictable. There is no hidden cost. We do the POC for free, and there is no risk. So when we Well,

Nathan Latka

14:04the risk is their time. The risk is their time engaging with you. Right?

Chafik Belhaoues

14:07>> That's true.

Nathan Latka

14:08This is So in

14:09the last six months, how many free fourteen day POCs have you done?

POC Volume and Conversion Rate

Chafik Belhaoues

14:14>> Woah. We have done, like, more than 100.

Nathan Latka

14:17Wow. Okay. So 100 of which 10 have converted to paid.

Chafik Belhaoues

14:20>> That's true.

Nathan Latka

14:21Okay. Into that's not a bad conversion rate, so that's working nicely. How are you doing this? How are you staffing this? What's your team size today?

Team Size and Structure

Chafik Belhaoues

14:28>> We are six. We are not that big. We are six people, and we are trying to, like, to specialize.

14:35>> I have a background, but now I'm doing mainly sales. Sales, a little bit of marketing. We got people in marketing, one in marketing, one in sales with me as well, and the others are developers. Mhmm.

Nathan Latka

14:48Now you raised 1,200,000 total plus another 175,000 from YC. Is that right?

Chafik Belhaoues

14:53>> That's true.

Nathan Latka

14:54Okay. And YC just recently, what, they take 7%. Right?

Chafik Belhaoues

14:59>> Yes.

Why Brainboard Joined Y Combinator

Nathan Latka

15:00And and and why did you decide that that was the right path for you guys? That's obviously a lot of dilution for a small check considering you guys already had $40,000 a month in revenue.

Chafik Belhaoues

15:09>> Yeah. This is yeah. Because we wanted to go to go to The US. We wanted to to target The US market. And we think that this is like the simplest shortcut that we can have. Going to YC, understanding how it works, being there, visible there. And also, we wanted to, you know, we are tech founders. We wanted this like a bootcamp of YC to be able to learn different things, to do things differently. And that wasn't

15:36>> an easy decision for us. So we talked with a lot of people that have done YC to understand the real value. So what comes to, what helped our decision is first network. It helps a lot. Second, it's really nice to have, to be baked by YC in The US. And the third point is the learning.

Nathan Latka

15:57Chafik, how did you get your pre seed investors on board with this? They wrote you a $1,200,000 check at a 4,000,000 valuation pre money. You just gave YC $175,000 check at a 2,400,000 valuation. So it's almost half the valuation you already raised at from pre seed investors. How did that make the pre seed investors feel?

Chafik Belhaoues

16:14>> They're comfortable with it. I mean, the investors we have, they already know the systems. Like, you know, our context is we are in France. It's a French company. And a lot of companies from France move to The US and do YC. So investors are already familiar with that. It's like, and they know that if you do YC, it's like

16:39>> you have more chance to succeed in the business than when you do it alone and in in Europe.

Nathan Latka

16:46Mhmm. We'll we'll see what happens. Interesting dynamics at play here. We're certainly rooting for you. In the meantime, let's wrap up with the famous five. Number one, what's your favorite business book?

Chafik Belhaoues

16:55>> My favorite business book is, Predictable Revenue.

Nathan Latka

16:59Predictable. That's a good one. Number two, is there a CEO you're following or studying?

Chafik Belhaoues

17:04>> Sorry?

Nathan Latka

17:04Is there a CEO you're following or studying?

Chafik Belhaoues

17:07>> Nope.

Nathan Latka

17:08Okay. Number four. Three. What's your favorite online tool for building brainboard?

Chafik Belhaoues

17:14>> Online tool. Maybe for for building brainboard, maybe Notion.

Nathan Latka

17:20Okay. Number four. How many hours of sleep do you get every night?

Chafik Belhaoues

17:24>> Not that much. Maybe six. Usually, it's six. Between five and six.

Nathan Latka

17:28That's not bad. And how old are you, Chafik?

Chafik Belhaoues

17:31>> I'm 40.

Nathan Latka

17:32I turned

Chafik Belhaoues

17:33>> 40 this year. Yeah.

Nathan Latka

17:34Four zero? Yes. Okay. And what's your situation? Married, single, kids?

Chafik Belhaoues

17:38>> Yeah. I'm married with a kid.

Nathan Latka

17:40Very cool. Okay. Last question. Something you wish you knew when you were 20.

Chafik Belhaoues

17:44>> Build brainboard. This is something that that I really wish I had the chance to do when I was 20.

Nathan Latka

17:52Guys, there you have it, brainboard.co launched back in 2019. It a 1.2 pre seed round at 4,000,000 pre money valuation. They grew from about a thousand bucks a month in revenue to over $40,000 a month in revenue now today and onboarding their first 10 enterprise customers after doing over a 100 free POCs. The system seems to be working. Just went into YC as well as team of six. We'll see what happens. Chafik, thanks for taking us to

18:15the top.

Chafik Belhaoues

18:16>> Thanks a lot, Nathan, and have a nice weekend.

Nathan Latka

18:20Alright, guys. Cut. Chafik, do think? You have fun?

Chafik Belhaoues

18:23>> Sorry?

Nathan Latka

18:24Did you have fun?

Chafik Belhaoues

18:25>> Yes. That was great. Really great. I really like it.

Nathan Latka

18:28Awesome. There's so many there's so many founders struggling with how to write a POC when they're just starting to land enterprise accounts. Is there a template or something that you use that I could attach this interview to give more value back to founders?

Chafik Belhaoues

18:43>> Yeah. The template what what I suggest, what I advise is to always do a use case that talks to the customer.

Nathan Latka

18:52Yeah. No. I I agree. People know that, but it's really helpful to see a real example. Do you have like an old POC that you use that that we could attach as a template to the interview?

Chafik Belhaoues

19:02>> We do not have a written one because we I mean, we have only one. We do not we didn't write down the POC how we do it. So

Nathan Latka

19:10No. No. I'm I'm not asking for a a template on how you do it. I'm actually asking for the, like, an actual you did a 100 of them so far. Can we attach an actual POC, like an old one that you that you used to the interview?

Chafik Belhaoues

19:22>> I I mean, you are talking about customer. Right? Prospects or customer or

Nathan Latka

19:26Well, we would we would we would we would remove the customer name from the from Okay. The

Chafik Belhaoues

19:33>> Yeah. I can sure we do that.

Nathan Latka

19:34Okay. I'll email you and ask for that. That'll make the interview way more valuable. I appreciate that.

Chafik Belhaoues

19:39>> Yes. With pleasure.

Nathan Latka

19:40Okay. Great chatting with you. Talk soon.

Chafik Belhaoues

19:43>> Thank you. Goodbye, Alan.

Nathan Latka

19:46One more thing before you go. We have a brand new show every Thursday at 1PM Central. It's called Shark Tank for SaaS. 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, 1PM

20:12Central. Additionally, remember these recorded founder interviews go live. We release them here on YouTube every day at 2PM Central. To make sure you don't miss any of that, make sure you click the subscribe button below here on YouTube, the big red button, and then click the little bell notification to make sure you get notifications when we do go live. I wouldn't want you to miss breaking news in the SaaS world, whether it's an acquisition, a big

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