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Founder Interview

How CleanCloud Reached $650K ARR and 40 Customers with a Team of 22 (Interview with Co-Founder and CEO Henrique Vaz de Almeida)

Interview Date
September 1, 2021
Interviewee
Henrique Vaz de AlmeidaCo-Founder and CEO
Watch
Watch the full interview

Company Metrics at Interview Time

ARR (2021)

$650,000

Customers (2021)

40

Year-over-Year Growth (2021)

320%

Team Size (2021)

22

Average Revenue Per Customer (2021)

$2,000 per month

Historical Snapshot

These numbers were reported by Henrique Vazde Almeida during the interview recorded in September 2021 and are a historical snapshot, not current figures. See CleanCloud’s current numbers.

Key Takeaways

  • 01CleanCloud reported $650,000 ARR in 2021, up from $192,000 ARR in 2020, representing 320% year-over-year growth.
  • 02The company serves 40 customers across two products: CleanCloud Score (CSPM) and CleanCloud Inspect (FinOps).
  • 03CleanCloud Score accounts for approximately 65% of revenue and CleanCloud Inspect accounts for approximately 35%.
  • 04Average customer pays around $2,000 per month on annual contracts with monthly or upfront payment options.
  • 05The team totals 22 people, including 6 engineers and 3 sales reps carrying quota.
  • 06Sales reps carry a $60,000 ARR annual quota with up to 5% commission depending on seniority.
  • 07CleanCloud was founded in 2017 and pivoted to compliance-focused cloud security in 2019.
  • 08The company was targeting a Series A raise of $4,000,000 to $5,000,000 in late 2021.
  • 09Early investors hold approximately 30% of the company and an ESOP pool accounts for 13%.
  • 10The two co-founders together hold approximately 62% of the company.

Company Metrics at Time of Interview

MetricValueSource
ARR (2021)$650,000Founder interview, Sep 2021
ARR (2020)$192,000Founder interview, Sep 2021
Year-over-Year Growth (2021)320%Founder interview, Sep 2021
Customers (2021)40Founder interview, Sep 2021
Average Revenue Per Customer (2021)$2,000 per monthFounder interview, Sep 2021
Team Size (2021)22Founder interview, Sep 2021
Engineers (2021)6Founder interview, Sep 2021
Sales Reps (quota-carrying) (2021)3Founder interview, Sep 2021
Sales Rep Annual Quota (2021)$60,000 ARRFounder interview, Sep 2021
Sales Rep Commission Rate (2021)up to 5%Founder interview, Sep 2021
Sales Rep Fixed Compensation (2021)$1,000 per monthFounder interview, Sep 2021
ESOP Pool13%Founder interview, Sep 2021
Co-Founder Equity (combined)62%Founder interview, Sep 2021
Investor Equity30%Founder interview, Sep 2021
CleanCloud Score Revenue Share (2021)65%Founder interview, Sep 2021
CleanCloud Inspect Revenue Share (2021)35%Founder interview, Sep 2021
Seed Round Valuation (average) (2019)$2,000,000Founder interview, Sep 2021
Year Founded2017Founder interview, Sep 2021
Products (2021)2Founder interview, Sep 2021

Growth Breakdown

Revenue

CleanCloud reported $650,000 ARR in 2021, up from $192,000 ARR in 2020, representing 320% year-over-year growth. Monthly recurring revenue implied by the ARR figure was approximately $54,000. Revenue is split across two products, with CleanCloud Score contributing about 65% and CleanCloud Inspect contributing about 35%.

Customers

The company had 40 customers at the time of the interview, spanning both its CSPM and FinOps products. Customers are concentrated in highly regulated industries such as financial services and health insurance. Average revenue per customer is approximately $2,000 per month on annual contracts.

Team

CleanCloud had 22 people at interview time, operating on a hybrid model with sales and product teams coming into the office a few times per week and the development team working fully remote. The engineering team consisted of 6 engineers, and 3 sales reps carried quota.

Funding

CleanCloud raised early capital from Vaca Nova in 2017, followed by a seed round in 2019 led by Anjos do Brasil and GV Angels. At the time of the interview, the company was preparing to open a Series A round targeting $4,000,000 to $5,000,000, with the founders aiming to sell 20% to 25% equity.

Growth Strategy

Pivot to Compliance in 2019

CleanCloud originally focused on cloud cost optimization but pivoted in late 2019 after observing strong customer demand for compliance solutions. The company launched CleanCloud Score in December 2019, targeting major compliance frameworks for AWS, Azure, and Google Cloud. This pivot repositioned the company in a higher-value segment of the cloud security market.

Dual-Product Strategy

By maintaining both CleanCloud Score (CSPM) and CleanCloud Inspect (FinOps), the company serves customers with different needs while retaining its original customer base. The FinOps product generates roughly 35% of revenue and provides an entry point for customers focused on cost optimization who may later adopt the compliance product.

Annual Contracts with Flexible Payment

CleanCloud sells on annual contracts but allows customers to pay monthly or upfront, reducing friction in the sales process while securing committed annual revenue. Pricing is based on two variables: the number of cloud resources evaluated and the frequency of compliance checks.

Lean Sales Motion with Commission Structure

Three quota-carrying sales reps each target $60,000 in new ARR per year, supported by a commission of up to 5% of closed revenue and a bonus structure that doubles for performance 50% above quota. Fixed compensation is kept low at approximately $1,000 per month, keeping the cost of sales lean relative to ARR.

Targeting Regulated Mid-Market Segments

CleanCloud focuses on mid-market and small-to-medium enterprises in highly regulated sectors such as financial services and health insurance, where compliance requirements create strong and recurring demand for cloud security posture management tools.

Best Quotes

“Our product, CleanCloud score is classified as a CSPM, a cloud security posture management. So it's going to connect to your public cloud, AWS, Microsoft Azure or Google Cloud.”
“On average they pay around $2,000 a month. We usually sell on annual contracts, can pay monthly or upfront.”
“We charge based on two variables. The first one is the size of the cloud. How many resources are we checking? And the second is the periodicity of the compliance checks. We have the option to check daily, weekly, monthly, whatever works best for the customer. So those are the two variables that are gonna change the pricing.”
“We started CleanCloud back in 2017. We started looking for security performance and cost reductions. And what we saw over the first two years that our customers were looking for cost optimization opportunities and there was a big gap and a big need in the market for compliance solutions. So we pivot in 2019 and later that year in December, we launched CleanCloud score focusing like I said on the main compliance frameworks and benchmarks from for AWS, Azure”
“A year ago 3.2 x. We grew 3.2x year to year.”
“We are with 22 people right now. We are here in working on a hybrid model, sales and product coming a few times a week to the office and the development team 100% remote.”
“CleanCloud Score, which is the CSPM and we have FinOps product. The first product that we have, which we call CleanCloud, we didn't have any names for it. So basically when we pivot in 2019, we look at our customer base and so they're looking only for cost optimization. So we decreased the product and created a CleanCloud Inspect, which is a FinOps product for AWS cloud.”
“We pay up to 5% depending on the seniority of the sales rep.”
“I think a few reasons. First of all, Latin America market is really booming, right? We have a lot of funds that raise a lot of money. So there's a good opportunity there. Second, cloud security is a sector that companies that PCs are really looking to because all those ransomware attacks that we're seeing across the market and all the exponential growth that cloud had over twenty twenty.”

What Happened Next

This interview captured CleanCloud at a specific moment in September 2021, when the company had reached $650,000 ARR with 40 customers and was preparing to open a Series A round. The figures here reflect what Henrique Vazde Almeida reported during the conversation and should be read as a historical snapshot. Visit the CleanCloud company profile on GetLatka for current metrics and any updates since this recording.

View CleanCloud’s current profile and metrics

Full Transcript

Introduction and Company Overview

Nathan Latka

00:00Hey, folks. My guest today is Henrique de Almeida. He's the co founder and CEO of CleanCloud, a Brazilian cloud security startup. He worked for a few years as a corporate lawyer and then became an entrepreneur, founding four companies across multiple industries. Henrique, are you ready to take us to the top?

Henrique Vaz de Almeida

00:13>> Yes, great to be here, Nathan. Thank you for the invite.

Who Are CleanCloud's Customers

Nathan Latka

00:17You bet. Okay, so CleanCloud, who's paying for this? Help me understand who your customers are.

Henrique Vaz de Almeida

00:22>> Okay, so we are focused on mid market and small and medium enterprises. So companies especially on highly regulated markets such as financial sector, health insurance and things like that.

Nathan Latka

00:37And so what might a bank or someone in the financial sector, what are they paying you for security wise?

Product: Cloud Security Posture Management

Henrique Vaz de Almeida

00:43>> Our product, CleanCloud score is classified as a CSPM, a cloud security posture management. So it's going to connect to your public cloud, AWS, Microsoft Azure or Google Cloud.

00:59>> We're going to check if we are compliant with the main regulations and frameworks in the market like for example PCI for credit cards.

Nathan Latka

01:07And what do they pay on average per month to use your technology?

Pricing Model and Variables

Henrique Vaz de Almeida

01:12>> On average they pay around $2,000 a month. We usually sell on annual contracts, can pay monthly or upfront.

Nathan Latka

01:20And what enables you to get someone to pay you more or less? What do you sort of price against? Is it a feature set, a usage based model, what?

Henrique Vaz de Almeida

01:27>> We charge based on two variables. The first one is the size of the cloud. How many resources are we checking? And the second is the periodicity of the compliance checks. We have the option to check daily, weekly, monthly, whatever works best for the customer. So those are the two variables that are gonna change the pricing.

Nathan Latka

01:49And how do you measure the size of the cloud?

Henrique Vaz de Almeida

01:52>> Number of resources evaluated by our product.

Nathan Latka

01:57Number of resources, servers. Resources.

Henrique Vaz de Almeida

02:01>> Yeah.

Nathan Latka

02:02And what might a resource be?

Henrique Vaz de Almeida

02:04>> Databases, How

02:06>> servers, whatever it is.

Nathan Latka

02:08I see. Okay, got it. And then frequency of compliance checks. So higher frequency and more databases means you're charging more money.

Henrique Vaz de Almeida

02:15>> Exactly.

Nathan Latka

02:16Okay. And take me, give me the backstory here. When did you launch the business?

Founding Story and 2019 Pivot

Henrique Vaz de Almeida

02:20>> So we started CleanCloud back in 2017. We started looking for security performance and cost reductions. And what we saw over the first two years that our customers were looking for cost optimization opportunities and there was a big gap and a big need in the market for compliance solutions. So we pivot in 2019 and later that year in December, we launched CleanCloud score focusing like I said on the main compliance frameworks and benchmarks from for AWS, Azure

02:55>> and Google Cloud.

Nathan Latka

02:56I'm sorry, you said 2019?

Henrique Vaz de Almeida

02:58>> 2019, yeah.

Nathan Latka

02:59Okay, got it. 2019. And have you bootstrapped or did you decide to raise capital?

Fundraising History and Seed Round

Henrique Vaz de Almeida

03:03>> Yeah, raised a small round with VC here in Brazil called Vaca Nova when we first started. Then we had a pre seed with friends and family and then a seed round led by two angel groups in Brazil, Anjos do Brasil and GV Angels.

Nathan Latka

03:21So that seed round that you did in 2019, how much was that for?

Henrique Vaz de Almeida

03:26>> It was a small seed like $250 ks US dollars.

Nathan Latka

03:30Okay. And how did you do that? Was that on a convertible note?

Henrique Vaz de Almeida

03:34>> Yeah. Convertible note.

Nathan Latka

03:35What cap do you remember?

Henrique Vaz de Almeida

03:39>> On that round, there was like two valuations because at that time we had one co founder that left the company. So we had this primary and secondary valuation and the average, we discuss this number, but it was around $2,000,000 there.

Co-Founder Departure and Equity Buyout

Nathan Latka

03:59Yeah. Well, you bring up a good problem, which is there's a lot of people that a co founder leaves and you have to figure out what valuation do you buy them out at versus then what valuation do you go raise at? And usually you wanna buy them out at the lowest price and then go raise at the highest price. So how did you manage that?

Henrique Vaz de Almeida

04:14>> Exactly. A good thing is that we didn't break up or anything. He had some personal issues that he left the company and he has some experience with startups. So he knew that with the percentage he had, which was 20%, the company wouldn't be able to raise on the round or a series A, whatever this is. So it was a good conversation. Of course, it's a difficult conversation to have. Hey, investors are coming in at X and

04:44>> you are leaving at Y, which is three, four, five, ten times lower. But he understood the issue. He understood what was fair. And what we did is that we buy out 75% of his equity. So he kept a little bit because he was in the early years of the company and we found this was fair. And so we were able to get to this number and ended up being good for everybody because for the investors, they

05:12>> could got into on a lower valuation when you look at the average. For me and my other co founder Jefferson, which is our CTO, we were able to kept more of our equity.

Nathan Latka

05:24So just to be clear, Henrique, he owned 20%, the co founder, you bought back about 75% of his stock, which is about 15% of the business at around a five X valuation discount to the 2,000,000. So somewhere around a valuation of like a $100, $200, something like that.

Henrique Vaz de Almeida

05:41>> Exactly, exactly. So something between five and ten x discount.

Nathan Latka

05:45Yeah, that's great. So if the valuation was like $200 to buy back his 15%, he got like a 10 or $20,000 check basically to sell back 15% of the business to you guys.

Henrique Vaz de Almeida

05:56>> It was, let me remember the numbers. Yeah, but something like that.

06:02>> We pay a total of 200 ks something like 150 ks, 200 ks something like that.

Nathan Latka

06:09That's what you paid him to get back 15%?

Henrique Vaz de Almeida

06:12>> Yes.

Nathan Latka

06:13Okay, got it.

Henrique Vaz de Almeida

06:13>> Sorry, sorry. Is, I'm looking at the I'm a Brazilian conversion. Pay him like R$30,000, R$40,000.

Nathan Latka

06:25Yeah. That makes a lot of sense. It's a really good way to do it. So, okay. So you got through that, which is a big deal. Then your cap table is cleaner. You go into 2020. Now you do a family round. How much did you raise from family and friends?

Henrique Vaz de Almeida

06:38>> The family and friends was before the seed round 2019. We raised it back in 2017 when we were first starting. So in total, CleanCloud raised like 3 and $50,000 something like that. We're kind of almost bootstrapped up until we are right now. We are getting close to a million dollars in ARR and we're looking to open a series A round over the next quarter or two.

Nathan Latka

07:04Okay, let me just break all that down. You raised $350,000 to date, 100,000 from family and friends in 2017 and 250,000 and one year later in 2019. Yeah. You're also approaching a million dollar run rate right now. What was your MRR last month?

Henrique Vaz de Almeida

07:20>> Last month in US dollars, like $300,000 No, sorry, dollars 650,000.

Nathan Latka

07:27In terms of ARR?

Henrique Vaz de Almeida

07:29>> In terms of ARR, yeah.

Nathan Latka

07:31So divided by 12, you did about 55,000 United States dollars last month. And how many customers?

Henrique Vaz de Almeida

07:38>> We have

07:42>> for both products we have like 40 customers.

Nathan Latka

07:46What are the two products?

Two Products and Revenue Split

Henrique Vaz de Almeida

07:48>> CleanCloud Score, which is the CSPM and we have FinOps product. The first product that we have, which we call CleanCloud, we didn't have any names for it. So basically when we pivot in 2019, we look at our customer base and so they're looking only for cost optimization. So we decreased the product and created a CleanCloud Inspect, which is a FinOps product for AWS cloud. They're gonna look for cost optimization opportunities. And we have like 40%,

08:20>> 35% of our revenue is coming from this product and the other two thirds, 65% is coming from CleanCloud score.

Revenue and Year-over-Year Growth

Nathan Latka

08:28I see. And help me understand growth. If you're doing $55,000 a month today, what were you doing a year ago?

Henrique Vaz de Almeida

08:35>> A year ago 3.2 x. We grew 3.2x year to year.

Nathan Latka

08:41Got it. So you're doing about $16,000 about a year ago. Exactly. Per month. Yep. That's nice growth. Now, why is now the right time to go raise capital? You mentioned a Series A.

Why Raise a Series A Now

Henrique Vaz de Almeida

08:52>> I think a few reasons. First of all, Latin America market is really booming, right? We have a lot of funds that raise a lot of money. So there's a good opportunity there. Second, cloud security is a sector that companies that PCs are really looking to because all those ransomware attacks that we're seeing across the market and all the exponential growth that cloud had over twenty twenty. So combining those things and our growth, moment, I think is

09:23>> a really good moment to go raise around.

Series A Target and Valuation Discussion

Nathan Latka

09:26And so you're raising a series A now, how much do you wanna raise?

Henrique Vaz de Almeida

09:30>> We are looking to raise around 4 to $5,000,000

Nathan Latka

09:34Okay, 4 to $5,000,000 at what valuation?

Henrique Vaz de Almeida

09:38>> We are still not discussing, on the early days. Are not really talking to funds or anything. I just, you know, starting those conversations, sending quarterly decks to show where we are going, what are our plans. We should officially open this round, I think later this month or next month.

Nathan Latka

09:59But how much equity do you wanna sell on your series A? Meaning you don't wanna sell above X amount?

Henrique Vaz de Almeida

10:05>> Usually we look for, usually a series A rounds is around 25% equity, 20 to 25%. So let's look to be on that percentage. Maybe we'll be able to get maybe some of the early investors we want some liquidity on that early investment. So valuation is still cloudy. I think there is a really big gap that we could go in terms of how much the company would be valued right now.

Nathan Latka

10:38Sure, yes. If you raise 5,000,000 and you only want to sell 25%, you'd be looking at like a call it a $15,000,000 pre money valuation, something like that.

Henrique Vaz de Almeida

10:46>> Yes. I think it'll be something between 10 and 15. Yeah.

Cap Table Breakdown

Nathan Latka

10:49Which should be a 15 to 25x multiple on your about a million dollar run rate. Yeah. Sounds, it feels pretty market. It's exciting. Now you mentioned cap table and early investors. You already told us about your co founder. How much do early investors own?

Henrique Vaz de Almeida

11:04>> Around 30%, including the founder that left the company. On our seat round, we created an ESOP stock option pool. So we have 70% on let's call insiders, me, my co founders and some employees and 30% on investors.

Nathan Latka

11:22Break

Henrique Vaz de Almeida

11:23>> down like you guys, the co founders versus your ESOP.

Nathan Latka

11:25How much do the co founders own just you two alone?

Henrique Vaz de Almeida

11:28>> The ESOP is like 13%.

Nathan Latka

11:33I see.

Henrique Vaz de Almeida

11:34>> And the reminder 30%

11:38>> each, right? Yeah, 31.5% each.

Nathan Latka

11:42Got it. So you guys as co founders own about 62%, your ESOP pool is 13% and early investors own still about 20%.

Henrique Vaz de Almeida

11:50>> Exactly. That makes

11:52>> a lot of sense.

Nathan Latka

11:53Early investors 30%, right?

11:5530%, got it. Cool. Very cool. That makes a lot of sense. Let's move forward here. There's a lot of investors that listen. Who would be like your perfect investors or anyone strategically you're looking for?

Henrique Vaz de Almeida

12:06>> Henrique I think those investors that know this space, the cyberspace, I think is a really exciting moment for this market. And anyone with experience, I think could bring a lot to us. We also have a product, we have a add on that we are mapping that would have a product like growth strategy. Someone with that kind of strategy, companies with PLG strategy on their portfolio would be interesting as well.

Team Size, Engineers, and Sales Reps

Nathan Latka

12:35And Henrique, what's the team size today? How many people?

Henrique Vaz de Almeida

12:39>> We are with 22 people right now. We are here in working on a hybrid model, sales and product coming a few times a week to the office and the development team 100% remote.

Nathan Latka

12:52And how many engineers are there?

Henrique Vaz de Almeida

12:54>> We have six engineers.

Nathan Latka

12:56Six engineers. Any sales reps that carry a quota?

Henrique Vaz de Almeida

13:01>> Carry quota three.

13:02>> Three.

Nathan Latka

13:04Two

Henrique Vaz de Almeida

13:05>> and a head of sales. Their quota is $30,000, $60,000 a year.

Nathan Latka

13:14Does that mean 60,000 USD a year?

Henrique Vaz de Almeida

13:17>> $60,000 in ARR is their quota.

Nathan Latka

13:22So that very, if they only close 60,000 a new ARR each year that barely covers their base compensation.

Henrique Vaz de Almeida

13:30>> Not really like their compensation, their fixed compensation like monthly fixed is like a thousand dollars a month.

Sales Compensation and Commission Structure

Nathan Latka

13:39Got it. So you pay them $12,000 fixed per year. Their goal is to close $5,000 of new ARR per month. And if they close that, you pay them some percentage of that commission.

Henrique Vaz de Almeida

13:51>> Exactly. They will pay commissions. We pay commission for every sale and pay bonus with quota and we call a super quota. If they have 50% over their quota, they'll have twice their bonuses.

Nathan Latka

14:08So if I do hit my 60,000 quota target, how much commissions will you pay me?

Henrique Vaz de Almeida

14:13>> We pay up to 5% depending on the seniority of the sales rep.

Famous Five Rapid Fire Questions

Nathan Latka

14:19So got it. 10% would be $6,000. So 5% would be half that or about $3,000 in commission on a 12 ks base. So my full on target earnings as a sales reps at CleanCloud would be about $15,000 Yes. Interesting. It'll be interesting to see how that scales over time. Let's wrap up, Henrique, with your famous five. Number one, what's your favorite business book?

Henrique Vaz de Almeida

14:39>> Hard Things About Hard Things and we should go with the obvious here.

Nathan Latka

14:43Number two, is there a CEO you're following or studying?

Henrique Vaz de Almeida

14:46>> I really like Almeida from NetApp, from, sorry, from Spot. That was bought by NetApp. He's a mentor and I really, really love what he's doing.

Nathan Latka

14:57Number three, what's your favorite online tool for building the business?

Henrique Vaz de Almeida

15:01>> Notion.

Nathan Latka

15:02Number four, how many hours of sleep do get every night?

Henrique Vaz de Almeida

15:06>> Six hours.

Nathan Latka

15:07Okay. And what's your situation? Married? Single? Kids?

Henrique Vaz de Almeida

15:10>> I'm living with my fiance. So hopefully in a few months, I'll be married.

Nathan Latka

15:15Okay. And how old are you?

Henrique Vaz de Almeida

15:17>> I'm 34.

15:18>> 34. Last question.

Nathan Latka

15:19What's something you wish you knew when you were 20?

Henrique Vaz de Almeida

15:22>> Oh, I wish I work as hard as I do now.

Nathan Latka

15:27Guys, there you have it. CleanCloud is a security firm based in Brazil. They've got 40 enterprise customers paying on average 2,000 per month. They're doing $55,000 a month in revenue right now, up from $16,000 a month just a year ago. They've scaled this up to about a $750,000 AR company raising just $350,000 So pretty capital efficient with their team of call it twenty two. They're looking at opening up a series A round here shortly, aiming for

15:50a $4,000,000 to $5,000,000 raise and are happy to sell twenty percent to 25% of business. We'll see what happens. Henrique, thanks for taking us to the top.

Henrique Vaz de Almeida

15:57>> Thank you for having me, Nathan.

Nathan Latka

16:00One 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

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16:48fundraise, a big sale, a big profitability statement or something else. I don't want you to miss it. Additionally, if you wanna take 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

17:09for 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 next thirty minutes. Feel free to let me know what you thought about this episode and 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

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