DASS Services Revenue & Funding (2024)

[00:00] Guys, you had a first company raise $2,000,000 of equity, learned a lot going through that, shut it down, now focused on dassservices.com. It's an AI training company today, but launching a SaaS product with Hub, they call it, and DaaS Content Manager. They'll do $500,000 this year Combined revenue streams just launched it though eight weeks ago as they look to scale in 2024. We'll see what happens next. Hey folks, my guest today is Aaron Vidas. He is [00:23] focused on more customers, profits and time with AI at his company, dassservices.com. Aaron, you're ready to take us to the top? [00:32] >> I [00:32] >> am. Alright. [00:33] What is d a s s mean? [00:36] >> Well, dass is actually named after Ram Dass, who's a spiritual leader in the counterculture movement in the sixties. And his ideas of You're Not Your Thoughts have actually influenced me a lot. Name the company after him. [00:49] Very cool. Okay, what's the company do? Can you tell a customer story? [00:53] >> Yeah, so we're an AI training company. So we help mid market tourism, retail service businesses, get more customers, profits, and time through automation. So we work with it's actually where I am right now, a luxury fishing lodge in the Queen Charlotte Islands automating their fish delivery. We work with hop on hop on bus, hop on hop off bus tours, to automate their reviews, for instance. That's a responding to reviews is a really big bugbear in the [01:22] >> tourism business. And then we also work with real estate companies. So some large property developers in Vancouver have used us to figure out where to apply AI in their business, and this is everything from construction handoff to, better estimations. And then we use automation AI, build those automations, and then train their companies on how to use those, and then do it themselves. [01:47] Mhmm. And is this a software company or services? [01:50] >> It's a mixture of both. So we actually have four product offerings. We start companies usually with what I call the AI Maximizer. Four weeks, you've got five to 10 ideas of or instances of where to use AI and automation in the business. We then transfer them to what we call DaaS training, which is basically building those high ROI automations for them. And then we train them how to do it themselves if they want. And then we [02:14] >> the reoccurring or software part, is two products. One's called the hub, which is all the playbooks of how to automate and use AI in the business, and then something called DaaS Content Manager, which automates it's meant for professional service people, to be able to write content in an hour. It gives them all the prompts, that kind of thing. Shows them formats it for all the particular social networks like LinkedIn, Instagram. They can review it, and then [02:40] >> it'll automatically get scheduled in Bootsuite. [02:42] And Aaron, how many folks do you have paying for the SaaS part of the business today? [02:47] >> We have eight on desk content manager. The hub has four companies. [02:53] Okay. And what do you charge on average for these products per month or per year? [02:57] >> Yeah. So remember, we're in the we're in a bit of the professional service game. So our AI Maximizer, our fee for services are between 30 ks and $2.50 ks. DaaS training the projects. Right now we have three active customers. We're at about 41 and a 500 a month. And then the content management system, I literally launched last week. So it has eight eight people in an agency using it. So 12 total people, and that's a 179 [03:23] >> a month. [03:24] Okay. So I guess a $179 or 179,000? [03:27] >> Sorry. A $179 per user per month. [03:30] Per user per month. Okay. Got it. So what would you I mean, look, a lot the most successful software companies start off as an agency. So I totally understand the balance between professional services and launching the SaaS. But I guess, if you look at I mean, what do you think total revenue at the combined entity, the agency plus the software will be here in 2023? [03:46] >> Well, I launched company eight weeks ago. So the '20 the total revenue will sit at probably about a just over a $500,000. Okay. And then the content management system is kind of the unknown one right now where we've tested it. We've already got a waiting list of, 218 people. And right now, I'm just getting getting the kinks out basically and getting testimonials for a lead page. [04:12] Mhmm. You just launched us eight weeks ago. Obviously, we're in a very interesting macroeconomic time. I believe as recently as three years ago in July 2020, your last company Strategy Box announced a $2,000,000 seed round. What happened to that company? [04:25] >> Unfortunately, had a series of events where I had we had some non payment with my customers, we had a deal fall through for acquisition. And it got to a point where macroeconomic climate was such where I was like, okay. Well, if we continue at this rate, a, you know, the valuation exit's not gonna be where any of us want to be. B, we also saw we had early access to ChatGPT just because it was a data [04:50] >> management platform and we did AI and machine learning. I had a look at a lot of the functionality that we were building and investing in, and I looked at the capabilities of ChatGPT and I went, well, this business is gonna be used for within a, you know, a couple of years if we continue on this path. So I shuttered it. [05:09] Oh, 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 [05:32] your 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 [05:56] get 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 [06:18] 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 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 [06:44] 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 what 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 [07:06] 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 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 [07:32] the interview. And so did did you return anything to investors or had you run out of cash at that point? [07:37] >> Oh, we just ran out of cash. [07:38] Okay. [07:39] So you shut the company down. I guess, did you mentioned there was an acquisition offer that failed. I guess help me understand why why that failed. Was it, you know, did the VC that it looks like fuel capital was behind or fuel ventures was behind you guys. Why did it fail? [07:54] >> I can't really go into that, but suffice to say it was just a misalignment of a misalignment of the acquirer and us in their goals for the business and with the capabilities of what the platform could do. [08:07] Mhmm. Mhmm. And the opportunity cost is though that that that you shut it down. Right? So it's effectively $0 batten up for everybody. Right? So I guess, why not sell it and at least get something out of it even if your vision is not aligned? I think [08:21] >> the interesting thing I've learned about data management and large infrastructure platforms is when you're an acquiring company, like, the build versus buy was several million dollars. Like, if a company wants to go build the functionality that we had before, you'd be looking at 3.25 to 3,500,000 US just in hard labor costs and, you know, 9 to 12 months. So that was kind of the pitch I gave some people as to say, hey. Listen. You wanna go [08:47] >> build this exact same thing? Why don't you go do that? Like, go do this. Or sorry. Buy us instead of that. And what I continually found was, well, we can do it better, faster, cheaper. You know, the CTO usually saying that or somebody in the technology group saying that to the large agency that we were talking to, let's say, maybe this this could fit into when my argument was always like, well, I actually built it so [09:12] >> I know all the problems associated with this, and I couldn't really overcome that hurdle. And like you said, it just becomes opportunity cost at a certain point where you're like, well, am I spending more time to act as my own investment banker or go build something else? [09:25] Yeah. I mean, are interesting learnings. I have a very similar story. I have a very similar I mean, look, this is the use this is what happens with most companies. But this is something that you launched, I believe, in 2015. So you were working on this. It wasn't like a one year project. I mean, this was like eight years, and you look fairly young. So when did you launch the company? How old were you? [09:40] >> When I launched the company, I was it came out of a so I I ran a management consulting group for a long for a few years. I had scaled it up. We had a lot of problems with getting data in to do analysis, which and I couldn't find a product that actually worked well, so I started Strategy Box. We it was a seven year slog, and I think the biggest learning for me was I, at the [10:03] >> end of the day, also just really didn't enjoy it. It wasn't a strength of mine. Data management and enter and we also sold to very large enterprises. We had customers like, financial service publicly traded financial service companies. Really large global agencies used us as their kind of client reporting suite. Those are long sales, twelve, eighteen months from, you know, first touch to actually getting paid, huge thousand step procurement processes. I know it gets headlines. I know [10:32] >> it feels sexy to do. I would say to most people, like, you have to have the capital to be able to wait that kind of stuff out, and you have to be built for it. And you you really love it. And I just frankly didn't really love it. [10:46] Mhmm. I imagine you started feeling this in your a pit in your stomach and you just tried to ignore it for as long as you possibly could. When did you first feel this pit in your stomach and do you regret waiting as long as you did to shut it down? [11:00] >> To be very honest, now looking back on it, it's probably one or two years in. There's a little voice inside my head that said, don't keep doing it. Like, you know, basically, like, I would ask myself in a tough moment, keep doing this. And I would hear a voice and it said no. And I didn't have and you have to forgive yourself. You were doing the best that you could at that moment with the tools you [11:21] >> had available to you emotionally and professionally. I didn't have, frankly, the courage to go, no, this isn't working very well. Even our raising money, we actually closed a round of funding with fuel at the start of the pandemic. And we actually received it was hell hell just to even get the money, Like, just actually physically transferring the money during a global pandemic was hard. And we started to scale. We were building we have we built an [11:50] >> amazing what I came up with. [11:51] Revenue at its peak, monthly revenue at its peak? [11:53] >> Monthly revenue at its peak was [12:02] >> $45,900 k. We had 900 we had close to 900 k in ARR. So Okay. Like, 80,000 [12:08] >> a month, something like that. [12:08] Yeah. [12:09] >> Yeah. We and we were the problem and the thing that was the straw I think the biggest struggle emotionally was we were always very close to cash flow positive. And I didn't run the business. I didn't run the business like the traditional, let's spend all the money as fast as possible. I really wanted it to be a profitable, profitable company because I knew that that would help us in subsequent funding rounds. Sorry. There's a guy walking [12:36] >> by here. [12:38] >> And that was probably the thing that took the greatest emotional toil toll on me was I was always so close to it being cash flow positive, and we always just seemed to miss it. Some deal wouldn't close. We'd have nonpayment by customers. We had, you know, things take a lot longer than we thought. [13:00] Aaron, mean, you keep going in 2015 and you feel that pit in your stomach two years in 2016, 2017. You then go to a seed round in 2019 pre pandemic and the 2,000,000 round of fuel. [13:09] >> No. Sorry. That was no. We just we only ever did this or sorry. You said seed round. I thought you said seed round. [13:14] Yes. Seed. 2,000,000 seed fuel ventures at the beginning of the pandemic. I mean, at 2022, that's three years after you felt that pit in your stomach, you're able to effectively force your way through getting that round done anyway. But it also, like, drastically reduced all of your optionality to sell the company and you control the sale at even just like a one x multiple, which would have been like a million bucks or something. So why did [13:35] you decide to go, like, force your way through around knowing you weren't, like, really interested in the business instead of just selling it then and cutting your losses? [13:45] >> Pride before the fall. Like, I would just say it's pride and ego. Like, it's really just a question of you're not listening to your intuition. And you're, hey. I can see success or I can see success around the corner. And so it feels close. But what I realized was because I was not inherently enjoying the day to day, that was always gonna be there. That was always gonna be [14:09] Every entrepreneur always feels like tomorrow is gonna be the day we hit the metric. [14:13] >> Yeah. And so I and my biggest well, my two biggest learnings out of the whole experience were you have to do something where you're enjoying the process day to day. Because, like, life's short, and it doesn't matter if you earn 150 k or or you earn a 150,000,000. If you're miserable, it's like, get out of it. And the second thing would be, specifically in that company, this was an enterprise soft enterprise SaaS play. And that meant [14:38] >> I should have raised a lot more capital in our seed round and then any subsequent funding rounds just to have the cushion of, hey. It takes us six months, twelve months, eighteen months to get a customer. Like, you gotta plan for that. [14:51] Yep. Yep. Makes a lot of sense. Look, you have all those lessons now. You're at dass. Now did you wipe the cap table, or do you give your fuel folks equity in the new business? [15:01] >> No. This is an entirely separate business. It's, there's no intellectual property share. There's no they're they're just totally separate things. Fuel's game is early stage, early stage, [15:15] >> pre seed seed companies in kind of consumer and b and light b two b. And I love the guys there. They're awesome. But, yeah, it's just this is not a fit for them. [15:25] So Mark Pearson didn't say, listen. You lost $2,000,000 of my money. I'm betting on you. We have a relationship with Aaron. I want that first check-in your next business. He never said that? [15:35] >> No. Actually, it was more they get their investors will still get a tax a tax loss because we were part of an investment scheme called EIS, which is in The UK. So their investors will recover about half of their money. And really, we're just looking forward to I'm looking forward to working with their portfolio companies and what we do now with dass. [15:56] Alright. We'll see what happens. In the meantime, though, let's wrap up here with the famous five. Number one, your favorite book. [16:02] >> Favorite book would be the inner work by Matt Sigvetti. [16:05] Number two, is there a CEO you're following or [16:07] studying? [16:08] >> Oh, Henry Singleton. [16:12] Number he's dead. Right? [16:13] >> Yep. [16:14] Still still good. [16:15] >> There was a what was it? The Outsiders, I think I just read. [16:20] >> Oh, yeah. Talk to Tony. One of my favorite books. [16:22] Yeah. It's always it's one of those books that's not widely talked about. I'm trying to grab it quickly here. Of course, I can't find it right when I need it, but it was a very good book. Alright. Teledyne, in case anyone's curious. Yeah. [16:33] >> Number big conglomerate in the sixties and produced incredible value. [16:38] Yeah. Yeah. Great returns. A guy [16:41] >> who is alive would be, Roger, I'm forgetting his last name, from, started Vista Equity Partners. [16:47] Robert Smith. [16:48] >> Robert. Sorry. [16:49] Yep. Robert Graves? Robert Smith. [16:51] >> Yeah. Robert Smith. Sorry. [16:53] >> Yep. Vista Equity. [16:54] Number three, what's your favorite online tool for building dass? [16:57] >> Make, which is kinda like a Zapier. [17:00] >> It's a little less well known, much more flexible, much better to use, much more robust. [17:05] Number four, how many hours of sleep do you get every night? [17:07] >> Seven to eight. [17:09] And situation, married, single, kids? [17:12] >> Part long term partner, getting married. [17:14] Awesome. Exciting. Any kids or no? [17:16] >> No. Not yet. [17:17] Alright. And how old are you? [17:18] >> 39. [17:19] Last question. Something to wish you knew when [17:22] >> you were 20. [17:24] >> You are complete and whole as is and you can save a lot of suffering by just accepting that. [17:29] Mhmm. Guys, had a first company raise $2,000,000 of equity, learned a lot going through that, shut it down, now focused on dassservices.com. It's an AI training company today, but launching a SaaS product with Hub, they call it, and DaaS Content Manager. They'll do $500,000 this year. Combined revenue streams just launched it though eight weeks ago as they look to scale in 2024. We'll see what happens next. Aaron, thanks for taking us to the top. [17:51] >> Thank you. [17:52] One 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 [18:18] Central. 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 [18:40] fundraise, 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 [19:02] 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 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, I do it so that we can all learn. We have to counter those people. We got [19:21] to push them away. Click the thumbs up below to counter them and know that I appreciate your guys'support. Alright, I'll be in the comments. See you.