How Chili Piper Grew to $30M ARR with 2,000 Customers and a Multi-Product Strategy (Interview with Co-Founder and co-CEO Nicolas Vandenberghe)

Introduction and Company Overview

Nathan Latka

00:00Guys, Chili Piper got going in 2016, 2017 helping SDRs book meetings. They broke 2,000,000 revenue in 2018, went on to raise a lot of capital, broke 15,000,000 in revenue in 2021, and then they had to make a drastic change when markets compressed. They took their team from 225 down to 150 after a team retreat in Morocco. That made them instantly profitable, at least cash flow positive, bought them runway. Now with a multiproduct approach, over five products in

00:24the market with a new chat GPT or sorry, AI products coming, They continue to drive growth. They have 2,000 customers paying an average $1,200 per month with a self serve option getting ready to launch, which we're excited about. Hey, folks. My guest today is Nicholas Vandenberghe. He is building a company called Chili Piper. Now you might know them from their early product, which really has to do with scheduling, but they really expanded nicely to a multiproduct

00:47approach. He's been on the show many times. He went the hard route of by the way, when I say hard route, I mean, it's hard to raise VC. He did it. I mean, he played the game. Him and Alina, the co-founder, they played the game. They got a lot done. Tiger came in with a huge round. They did a secondary, all that jazz. You know, they then had to make some cuts, reposition the business, and now

01:04revenue is growing again. We're gonna jump into all of it today. Nicholas, are you ready to take us to the top?

Nicolas Vandenberghe

01:08>> Let's do it.

Revenue Growth to $30M ARR

Nathan Latka

01:10Alright. I wanna go back to the team retreat. You knew hours after the team retreat, you're gonna have to lay off a bunch of people to sort of right size the business. What year was that again? Just remind my audience. Just last year.

Nicolas Vandenberghe

01:19>> It was last November 2022.

Nathan Latka

01:22Last November. And before coming on here, I want I wanted to reach out and said, hey. How's revenue going? And and you told me I don't wanna say it out of our email, but you told me revenue today is about what in terms of ARR?

Nicolas Vandenberghe

01:32>> We're getting 30,000,000. Right.

Nathan Latka

01:34And that's up from about 16,000,000 in twenty twenty one, two years ago. Right?

Nicolas Vandenberghe

01:40>> Yes. That's right. Exactly.

Nathan Latka

01:42It's almost doubled over the past two years. In the middle of a big layoff, I don't think you raised any additional capital. Is that correct?

The Morocco Retreat and Layoff Decision

Nicolas Vandenberghe

01:50>> No. We switched to being cash positive.

Nathan Latka

01:53Amazing. Okay. So I wanna dive into the story. Right? So how did you get to cash flow positive?

Nicolas Vandenberghe

01:58>> Well, so we had to do a a pain force a painful reduction in force. The story you're telling is that we took everybody to Morocco in an unbelievable trip, and we got a lot of shit for that because people say, look at this idiot. They're spending all this money, but it's irresponsibly, but it's not quite the way it happened. We do a trip every year. We're actually just back from Iceland. Even though we're cash positive, you

02:25>> know, we manage our cost. We we flew everybody to Iceland. In Morocco, we were operating under certain growth assumption, you know, and so we had more than 200 people at the time of the company.

02:39>> And as the market slowed down, we thought, okay.

02:45>> Let's talk to additional sources of financing to see if we can continue that growth. And when we came back, you said a few hours be after it it actually took us an entire week of meeting with potential investor immediately upon coming back from Morocco where it was clear that that the market changed too much, investors had lost appetite. So to your question, we we laid off a third of the company. So

Nathan Latka

03:09So 200 down to a hundred and twenty five?

Rightsizing from 225 to 150 and Reaching Cash Flow Positive

Nicolas Vandenberghe

03:13>> Two we went from two twenty five to one fifty. Okay. Two twenty five to one fifty in one shot. And the idea is to say,

03:23>> we do it. It's done. We don't go into other layers. Those who stay are in for good, and and they're not they're not going to worry. And so we scaled it to a price point where we can tell we could tell that we were going to be cash positive. Right? And and so that's what we did. We did one go. We we did it with as much support as we could for those we who couldn't stay.

03:45>> So we helped them find a new job or place them. I wrote many LinkedIn recommendations. Because, of course, when you go from when you get to one third of the company, get you have to let go a lot of very talented people, the people who were were performing because, you know, it's just the nature of it. So it's not like there was anything wrong with anybody. So it seemed that, fortunately, most of them were able to

04:10>> bounce back even though the markets were difficult. I'm happy to observe that the Chili Piper is gonna become a strong brand, and and people are interested in hiring ex Chili Piper. Call we ourselves we call ourselves Piper. So, you know, we see all of them doing good jobs. So so it's obviously been a painful transition, but but it just works well.

Nathan Latka

04:33Oh, 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

04:56your 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

05:21get 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

05:43not 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, 1,200,000 seed round, 3.7 raise. They sold 22% of their business. Go in here and filter by 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

06:08going 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 what you can get now inside of Founderpath. And we're thrilled to bring it to you. Alright. We're gonna go back to the YouTube video here in a second, but if

06:30you 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 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. Alright. Let's jump back into the

06:57interview. My first interview when I first discovered you and Alina was back in 2018. You guys at that point were making on average you told me ARPU was about $820 per customer. I then had you on again in 2021, and that had grown about 1,200. I I'm gonna guess. You haven't told me this, but I'm gonna guess ARPU today is even higher than that, and it's or maybe flat, but because of your multi product strategy. Can

07:20you maybe just take us through the quick product? You launched with a scheduling tool. What products do you offer now today?

Multi-Product Strategy and Demand Conversion Suite

Nicolas Vandenberghe

07:26>> Today, we're bringing to market a full range of product focused on what we're calling demand conversion. So we we exactly what you said. We started with a scheduling product, but it was it was already more targeted than just Calendly. Our initial product was to help SDRs book meetings with account executives. So we already had routing, round robin, and, you know, and then a one click. And something that people don't understand is that we give the ability for

07:56>> SDRs to book themselves. So, Calendly, it's about having the prospect booking. You send a scheduling link and the prospect books, but SDRs doesn't work that way. You're on the phone. You you you are the one who is booking. So, Calendly, it actually doesn't show this use case. That's And what we started with. So in the early days. And we bootstrap. We did raise money in 2019. 2019, 3,000,000 small round, and and then really in twenty twenty

08:22>> twenty twenty twenty. Yep. But but so so when when we then launched this concierge product where when people come and submit a form and they see the thank you page and companies lose their prospects in the thank you page, we build this product that qualifies new leads in real time. Now we've added a product to do automated lead distribution. So for those who don't ask for a meeting but but come to webinar and all that,

08:49>> we call it Distro. And we'll be launching soon a chat product to have the full range of what it takes to convert interest into a pipeline, basically. Yeah. We're also launching a new version of our scheduling product where we've thought long and hard about how AI can help that use case. You know, a lot of people say, I want to do the ChatGPT of Calendly, and and so we have something coming in the in the first

09:17>> quarter that we think is the Chelsea busy account only. You know? But but but we'll see. It's

09:24>> it's very cool product I'm excited about. So we have a full range of of the tools it takes to convert, again, convert interest into pipeline. When you have a Yep. Interesting prospect, whether it's by email, whether on your website, what it takes to be there. And In terms of Go ahead.

Nathan Latka

09:43I didn't mean to cut you off there, Nicholas. But in terms of order of operations, so today, if people go to solutions dropdown on your website, you've got, from what I can see, five products. You're really your first product, though, was Instant Booker. And then what what came after that? Handoff Distro, Concierge Live, or Form Concierge?

Product Sequencing and Decision-Making Process

Nicolas Vandenberghe

09:59>> Okay. So it went

10:03>> Handoff, then Instant Booker, then Concierge, then Concierge Live, not Distro, and Zoom Chat that is not yet listed on the on the website where it will come soon.

Nathan Latka

10:14One of the things that I think a lot of founders

10:18don't spend enough time thinking about everyone has a product vision, but they don't think about order of operations, sequencing. Like, what should come first and then second and then third. How did you guys ever debate this internally? I'm sure you have a million projects. How'd you decide what to do next and then after that and for after?

Nicolas Vandenberghe

10:34>> We debate it internally. We have this thing called decision memo where we list the options of how we should do things, and everybody contributes their their data and their evidence that they have supporting it one way or the other. So that that's how we do it. And and we try to be very strategic about it, but

10:53>> we don't always get it right. So

10:57>> little known is the fact that in 2020, we launched a product called Inbox.

11:03>> Because we thought, okay, we need to help people engage with their buyer, and that is a lot of things happening in the Inbox. So let's do an Inbox, an email Inbox. We we're talking about, like,

The Inbox Product Launch and Failure

Nicolas Vandenberghe

11:12>> a for Gmail or an email client. And we pulled it out after a couple of months. For that very reason, it's a problem with sequencing. We're not ready to bring this product to market. We we are still we still have too much work to do targeting marketers, targeting ops, and it was too early for us to go after the end users and helping the end users. Even though I love the product, we pulled it out because,

11:36>> you know, one thing is to have a good product, another one is to be able to bring it to market. Yeah. And I I

11:43>> most entrepreneurs misunderstand the challenge of bringing a product to market. You know? You take so much energy, and so at the time we felt that we didn't have the energy to bring this product. So to to your question, now we think long and hard about which product is closest to what we have now and and most likely to succeed and and

12:07>> relevant to our existing customer base so that we can leverage our customer base to to to accelerate, and that's how we sequence them.

Nathan Latka

12:14I mean, what convinced you though? I mean because if you go back to, think it was like February 2020 is when you launched in your dropdown, it was under sales execution and it's out of inbox beta invite only. You were thinking about inbox then in February 2020. When you go back and look at the thesis on I mean, because everybody was convinced. Let's go launch this product. When you go back into a postmortem, what were some

12:36false assumptions you made back then? Was it just your capacity to handle new product line you overestimate or underestimated how much work it would take, or was there something else?

Nicolas Vandenberghe

12:45>> The first hypothesis we made was the speed of adoption. We got people interested, but then they tried it. They

12:57>> didn't use it for some obscure reason. And it takes a lot of work to get people to adopt. You know? You get this myth that Slack went up live and all of sudden and maybe it happened to Slack, but it doesn't happen to the rest of us. You know? To get a product to get adoption, it takes a lot of energy, And the first hypothesis was the level of energy we take. It it will start to

13:18>> just take it on its own, and and and it was not happening. So

13:25>> we just thought right now we have too much work still to do on the other products to continue the adoption that we can't afford to assign these resources to Inbox. That's what happened.

Nathan Latka

13:35Well, and it's a tough balance because I imagine people on your team are going, okay, let's go research Front app and let's go look at Shift. Then there was a button, you know, Todoist. There's a bunch of these other tools that were only doing a sort of inbox idea, and it looks like it's simple and doing well. And it's a logical thing for you and I as founders to go, okay. Let's go take some of that

13:51market share. We have a built in customer base, but it's hard.

Nicolas Vandenberghe

13:54>> You're right. And and what happened is that we we had a lot of good ideas about Inbox, which I still think are good ideas. But good ideas still need a lot of work to get adoption. And so so it it was painful to say, well, to put it out, especially with the with those who built it. But it's the way we I thought of it just like we say in French, You know? It's not farewell.

14:22>> So it's only it's only au revoir. Means it's not farewell forever. It's just goodbye. It will be taken. Yeah.

Customer Count and Market Positioning

Nathan Latka

14:30Interesting. Okay. So, okay, that's a prior strategy. That's super helpful to understand. Update us on customer say, how many paying customers pay for chill one of Chili Piper's products?

Nicolas Vandenberghe

14:38>> Yeah. I'd say what was the question?

Nathan Latka

14:41How many paying customers?

Nicolas Vandenberghe

14:43>> 2,000.

Nathan Latka

14:44So about 2,000. Okay. Great. And are you gen would you generally say that you're moving upmarket or staying where you are, midmarket, SMB?

Nicolas Vandenberghe

14:54>> Currently, we're staying where we are. We've been staying where we are mid market in the last two years. We are launching self-service version of our products

Nathan Latka

15:05in the first quarter,

Nicolas Vandenberghe

15:06>> so we are going to serve SMB more efficiently.

Nathan Latka

15:09Okay. Wait. Take me to that decision because that's a big why go that route versus going upmarket and only looking at 50,000 ACVs?

Self-Serve PLG Launch and Downmarket Strategy

Nicolas Vandenberghe

15:18>> Yes. You know, that's a contrarian view I I have actually. Because you hear all the issues in the go up market, go up market. And and I'm observing how HubSpot is taking market share away from Salesforce, And they take them from the bottom, and then from Marketo and from the other. They take them from the bottom. Because when you start with a product that can serve the the bottom efficiently, and you start going up, the incumbent

15:46>> that started up, it has a very hard time competing. Right? The product's more complex. It's more expensive. And and so I've already thought that the the way to the better way to go at market is go to down market first.

16:03>> Yeah. So that's because I I I see

16:07>> oh, keeps repeating, oh, we love SMBs. We love SMBs. We just wake up for SMBs. And in the meantime, if you look at the product, they keep bringing enterprise features more and more, especially, and they get more enterprise business and you know? And so I'm sure it has some purpose, like pretending that you love an SMB in the meantime, he's going and crushing Salesforce on the enterprise side. You know? It's like like like it's a status

16:30>> mode. So that that's the that's what we're doing. We're doing we we doing a self-service. We want to we want to make sure that we serve the the smaller guys out there well, efficiently for both parties. And and we think these are these are the foundation that you will take to to to scale back up.

Nathan Latka

16:49Do you feel like your product's in a place where people can successfully onboard without anyone from your team touching them or helping them or getting on a call with them?

Nicolas Vandenberghe

16:57>> No. We redid it everything. We relaunch it.

Nathan Latka

17:00Wow. Okay.

Nicolas Vandenberghe

17:01>> So so so so so the answer is yes, but only after years of investment in r and d. And and we we've had so many mock ups of the design of the product that we do. We even recently, we completely changed again. We launched something, and it didn't quite work the way we want it. So it takes a lot of work, but I I do think with with.

Repricing Options After Market Compression

Nathan Latka

17:24Yep. You did a $15,000,000 series a in December 2020 at a 60,000,000 post and then a $33,000,000 series b in February 2021 before the big secondary in November 2021 at a 625,000,000 post money valuation. This isn't just you. This is the whole market. Everyone's valuations are down. How do you talk to people about their the the value of their options today and making sure people stay excited and incentivized to keep building a Chili Piper?

Nicolas Vandenberghe

17:50>> Yeah. So we repriced. We repriced the options. So we, I went to the board. I said, look. I'm pretty there were other stock options to be motivated. We just so we we we had another 409A, like, score to tell us the kind of correct pricing, and we repriced our options. I see. Yep.

Nathan Latka

18:10I see. Okay. That's a good way to do it. Yeah. Very cool. Okay. So to sum, I mean, we got self-service coming up here soon. You like staying where you're at. You got a multiproduct approach, five current products with an AI play, coming up here shortly, which we're excited about. You've repriced options. The team is smaller, higher revenue per employee, and you've done all this. Even by cutting team size, you've doubled revenue, over the past two

18:31years. Before we finish up here, how are you getting new customers? What's your main growth channel?

Growth Channels: SDRs and Partnerships

Nicolas Vandenberghe

18:37>> It's still the main same mix of inbound and outbound. We still have an SDR team. They're great guys.

Nathan Latka

18:43How many?

Nicolas Vandenberghe

18:44>> 20. 20 SDRs.

Nathan Latka

18:46Okay.

Nicolas Vandenberghe

18:47>> Yeah. Yeah. Yeah. Oh, close to 20. And they do a really good job. And is continuing to to to perform.

18:57>> We've added, excuse me,

19:01>> Motion that I'm very happy with. We call it Chili Piper everywhere. So we've done more partnership, ecosystem partnerships. So for example, we integrated with Intercom, Clearbit, Gong, you know, and so if you if you want to Gong engagement, we're work with Chili Piper. We integrated with G2. So if you want to list your products on G2, instead of getting leads by email, you can actually have the your prospect book on the G2 site

19:31>> with your sales rep. See, so we're actually moving the scheduling on the G2 site for our customers. So we we have this big motion, and that's bringing up a sizable amount of business now.

Nathan Latka

19:45To just be clear, Nicholas, if I go to chilipiper.com/integrations, you've got over 64 I mean, this is a serious investment. You've got over 64 partners here ranging from Candu to Clearbit to Eloqua to Gong, etcetera. These all require unique, obviously, building experiences. But on the back end, you're saying there's partnerships with each of these two, and they're driving new business. You're driving them business, and this is a big growth channel for you.

Integration Ecosystem and Chili Piper Everywhere

Nicolas Vandenberghe

20:06>> That's that's just exactly right. Yes.

Nathan Latka

20:08Can you go deeper on that? So, like, ClickFunnels is listed here. What are you doing in terms of back channeling with ClickFunnels? And you say, hey. We'll build this integration if you send us customers and here's some what we'll send. Like, what does that sound like?

Nicolas Vandenberghe

20:19>> The the the most common integration is is the ability to to

20:25>> book a meeting when you're in a product. With this product that you're on the phone or you're in email, and then you can enter into click on Chili Piper to book the meeting or send a link to your supervisor. So that's the part of integration. So it's about scheduling in other people's products. We also have integration for it is

20:44>> Sendoso, for example, where if you send a gift, then you receive the gift, and then you can book a meeting with the person who sent you. So that that's the general approach we have, know, in many many situation, a meeting needs to happen, and we dare to enable the the the scaling.

Organic Traffic and Viral Booking Experience

Nathan Latka

21:03Do you know off the top of your head how many unique hits Chili Piper is it clicks Chili Piper is getting from Google organic per month? Is it, like, hundreds of thousands or tens of thousands? Do know?

Nicolas Vandenberghe

21:14>> Yeah. I don't know, but it's in the hundreds of thousand. Yeah.

Nathan Latka

21:17So you have a strong SEO play, inbound SEO, organic SEO?

Nicolas Vandenberghe

21:20>> We we get a lot of

21:25>> clicks from the viral aspect of it. Right? So people tried tons of it, people go to a website, they book with Chili Piper. So, well, that was a great experience, and they come to our site that way. So it's more the viral aspect than the SEO that's working for us. SEO to be can be the thing we can do better, and we and we get back to it next year. You see?

Nathan Latka

21:46So just to be clear, when people book a meeting and it says, this meeting was booked with Chili Piper, and then you can click the logo and go through, you're getting hundreds of thousands of clicks per month from that logo placement.

Nicolas Vandenberghe

21:55>> Not from the logo placement. From the fact that the experience was good and and and people either click on that logo placement or search Chili Piper or type in Chili Piper. Yeah.

Famous Five: Books, Tools, and Lessons Learned

Nathan Latka

22:04Amazing. It's amazing work. Well, this is a hell of a story. You're always very transparent and a ton of fun to interview. Let's wrap up here with the famous five, Nicholas. Number one, favorite business book.

Nicolas Vandenberghe

22:14>> Oh. Oh.

22:18>> I still have to say never split the difference because it's

Nathan Latka

22:23You're consistent.

Nicolas Vandenberghe

22:23>> Salespeople. Yeah.

Nathan Latka

22:25Number two, I would ask what CEO you're following or studying, but it sounds like you're following Darmesh and HubSpot closely.

Nicolas Vandenberghe

22:30>> Yes. I'm following Darmesh and HubSpot. Yes.

Nathan Latka

22:33Number three, what's your favorite online tool for building Chili Piper?

Nicolas Vandenberghe

22:39>> Online tools for me. So you're comparing with the with the what I said last time. Online tool is better is is G Suite because we we do so much on on on documentation.

22:52>> All our decisions, all our logs, it's on G Suite. So Google Docs.

Nathan Latka

22:58It's Number

Nicolas Vandenberghe

22:58>> seems very, very simple, but it's very powerful.

Nathan Latka

23:01Number four. How many hours of sleep do you get every night?

Nicolas Vandenberghe

23:05>> I had Alina give me a book that says, look. If you want to live longer, you have to sleep eight hours. So I'm I'm aiming for eight hours. I'm I'm seven to eight.

23:15>> That's that's awesome. That's awesome.

Nathan Latka

23:17So married, and you had two kids in 2021. Still two kids, or is another one?

Nicolas Vandenberghe

23:22>> Still two kids.

Nathan Latka

23:23Still two kids. Okay. And I think you've had a what are you? 56 now? 57?

Nicolas Vandenberghe

23:28>> Yeah. That's what I'm 57. Yeah.

Nathan Latka

23:3057. Alright. Last question, Nicholas. Something you wish you knew when you were 20.

Nicolas Vandenberghe

23:36>> Something I wish I knew I wish so when I was 20, I didn't I didn't imagine that entrepreneurship existed. And for sure, I wish I knew that you can take that route, that you can you don't need to wait and you can just start something. It it seemed impossible to me, and I wish I'd known that it was actually difficult, but something was doing.

Nathan Latka

24:04Guys, Chili Piper got going in 2016, 2017 helping SDRs book meetings. They broke 2,000,000 revenue in 2018, went on to raise a lot of capital, broke 15,000,000 in revenue in 2021, and then they had to make a drastic change when markets compressed. They took their team from two twenty five down to 150 after a team retreat in Morocco. That made them instantly profitable, at least cash flow positive, bought them runway. Now with a multiproduct approach, over

24:28five products in the market with a new chat GPT or sorry, AI products coming, they continue to drive growth. They have 2,000 customers paying an average $1,200 per month with a self serve option getting ready to launch, which we're excited about. Nicholas, we appreciate you. Thanks for taking us to the top. Thank you, Nathan. One more thing before you go. We have a brand new show every Thursday at 1PM central. It's called Shark Tank for SaaS.

24:51We 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 Central. Additionally, remember these recorded founder interviews go live. We release them here on YouTube every day at 2PM Central. To make sure

25:17you 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 fundraise, a big sale, a big profitability statement or something else. I don't want you to miss it. Additionally, if you want to

25:38take this conversation deeper and further, we have by far the largest private Slack community for B2B SaaS founders. You want to get in there. We've probably talked about your tool if you're running a company or your firm if you're investing. You can go in there and quickly search and see what people are saying. Sign up for that at nathanlatka.com/slack. In the meantime, I'm hanging out with you here on YouTube. I'll be in the comments for the

26:01next thirty minutes. Feel free to let me know what you thought about this episode. If you enjoyed it, click the thumbs up. We get a lot of haters that are mad at how aggressive I am on these shows, but I do it so that we can all learn. We have to counter those people. We got to push them away. Click the thumbs up below to counter them and know that I appreciate your guys'support. Alright, I'll

26:19be in the comments.

Nicolas Vandenberghe

26:20>> See you.