How GeoSpiza CEO Sarah Tuneberg grew to $468K revenue and 3 customers in 2019.

you're gonna love this interview just got done editing it i'm glad i got it live for you i'll be in the comments for the next 30 minutes hanging out answering any questions you have in fact leave a comment below about data points or what you think is going to happen to the company and i will respond to every comment additionally if you're just loving the content click the thumbs up and i will go and check out your profile as well and give your videos some love as well in the meantime enjoy the interview hello everyone my guest today is sarah toomberg she's the co-founder and ceo of a company called geospisa which she founded after more than a decade in emergency management and public health in order to transform the way climate risk decisions are made she leads the team's the interdisciplinary team at geospisa on developing data-driven evidence-based solutions models and processes that reduce risk and enhance resilience all right so are you ready to take us to the top absolutely okay very cool so just be clear yeah you are co-founder you are leading the company when did you launch the company what year correct uh in january 2018. okay so fairly new yeah yeah it's just about our second birthday and explain to us maybe give us a customer story how's the customer using you sure absolutely so um an example would be one of our customers is a large multinational brewer and they face huge climate pressures on several fronts first grain requires a lot of water it's very intensive and then their transportation processes require uh shipping on for example the rhine river which is highly in flux unpredictable things happening as a result of climate change so in the case of this brewer they would uh look at all of their various complex supply chain elements evaluate them in the context of various hazards drought sea level rise unpredictable flooding and then make a plan within the application about what they could do to reduce that risk and then evaluate in real time if those strategies are meeting their revenue targets their emissions targets their service targets whatever those might be interesting okay and what do they pay i mean what's your average customer pay per year to use this yeah so we have two products we went to market originally with a gov tech product this is where you go oh gov tech but it worked out great we have uh lots of government customers who really love us uh right about fifteen thousand dollars a year and then starting in august we went to market with an enterprise sas product serving two thousand companies benchmarking right 160 000 a year okay sorry you cut out right when you said that how many sorry 160 000 a year across how many folks in the enterprise uh it what how many customers do we have sorry i think you so you said another number before the 160. ah so govtech about 15 000 a year enterprise 160. so our move from govteck to enterprise global 2000 companies 10xing our revenue interesting i wonder why you move though so give me a sense of kind of what you moved away from so on that gov tech product are we talking like five customers or 500 or what was the size there 11. uh so still pretty modest but uh as you can imagine that that sales cycle is a tough one um and we started getting huge amounts of cold inbound from very large corporations asking us to help them with their climate risk management and uh we we explored that and then went to market in august and we have three customers at that 160 000 point uh 28 global 2000s in our sales pipeline after a net new so either in demo or sales negotiation stages really making progress interesting okay so let's let's unpack all this real quick yeah 11 customers on gov tech product at 11 or 1500 per year that's like call it 16 to 20 grand in arr you made the decision said you know what well hold on did you make this and you want to move away from that or you started getting inbound and you said we should switch to this new thing that people are asking us for correct we we really heard the market signal and we got just a ton of inbound a ton of asks we did a really structured exploration i talked to 25 ceos and cfos and risk managers and said what exactly are you missing what is it that you need and it was clear that we had a start to that and we we could meet that need so we really shifted to to meet the opportunity who was the first one that cold emailed you which company uh japanese deloitte i think was the first one okay and what did the emails say like what was the subject line do you remember uh we're working with a property and casualty insurer what can you do to help them with their sea level rise risk and they actually turned out to be our first customer do you wrote back and said did you ask how did you hear about us and what they say correct uh so we've we've found out that there's three primary ways that people have have found us one just a straight google search which baffles my mind that huge enterprise companies are searching for uh innovation through google but cool when they search what term do you rank for uh climate risk flooding risk disaster lots of disaster um and then the other two ways are bloomberg did a piece on us in the spring which just generated huge amounts of inbound and then also i spoke at the economist in london over the summer and that also has been incredibly powerful um how did you land the bloomberg piece they reached out to us and they must i mean do you know how they found you or why they asked you i think one of our competitors suggested us competition and then that reporter was like oh cool what are you guys doing and then [Music] i'm always happy to talk to a reporter so uh sure yeah let's let's chat that's interesting okay so the bloomberg piece and the economist piece in the summer of 2019 you think generated some of this inbound like the one from japanese delayed correct and and europe and all sorts of companies okay so now three customers 13 grand a month uh or 160 a year so what is that like 5 600 grand in arr uh so we're right about 12 000 in uh no sorry 60k uh a monthly recurring will hit about 500k this year with sites set on on 1.5 million next so just to be clear like this month basically you're at 60 000 a month forward-looking that would put you obviously at 720 000 in run rate ar run rate exactly that's great okay then those three customers are paying more than 160 000 per year right well we have our old ones that come along too oh god i got it fair enough we still service them they're wonderful that's great okay now did you just to calculate growth rate did you have any revenue exactly a year ago oh i think we maybe had like i don't know 30 000 an annual recurring an annual interesting okay so yeah basically enough call it two grand a month now you're doing now you're doing 60 grand a month a little different correct huge difference bootstrapped or raised no we raised so we did techstars boulder raised a little bit on that note and then in total over the lifetime of the company we've raised a million um and we also have been really successful at non-dilutive uh so we've gotten through pitch competitions you can see this check back here how much does it say i can't remember 4 000 or 40. i think it's 4 000. that's good but in total we've raised 500 000 in non-dilutive we have 3 million under consideration now we've really leveraged uh grants prizes pitch competitions all of those things they should not be underestimated yeah okay so just be clear a million in equity raised correct 500 000 on top of that non-dilutive grants correct and looking right now at 3 million in new grants right now all non-dilutive correct fascinating which government or entity uh so we've done well with national science foundation um also just i pitched a lot for a year so whether it's south by southwest or female pitch competitions they come with a lot i won a hundred thousand dollars in the chloe capital competition yeah interesting okay uh fill out the team for me how many folks on the team seven okay how many engineers five okay any quota carrying sales reps or just you uh i have no i have a sales team mate neither of us carry a quota we measure our net on net new meetings but uh not quota at this point so what i mean what do you set that at right you said 28 folks in the pipeline i mean what do you set you and your sales buddy how many demos you want to do per month how much inbound do you need to get that demo target yeah so we measure via net new meetings and we target 40 net news a month we feel like that's a flow we can handle um and then that's yielding the results we want i would say since we've only been at this new enterprise scenario since august we don't yet know exactly how the metrics are going to shake out um we're seeing it working i think q1 will be a real inflection point for us interesting any plans to raise additional capital besides the grants we'll see yeah i think again q1 seeing how it goes seeing how much revenue we can get and then what we service a global customer base and so i think there might be a need to fundraise to fund some global expansion uh yeah are you guys profitable right now are burning cash to grow no burning cash to grow how do you mind me asking how much how much can you sleep with uh oh i can sleep with a lot as long as i can raise it i can spend it as long as it's sufficient but uh we're burning about 50k a month okay that's net burn or gross nut burn okay so your bank's going down by 50 grand a month even after revenue okay absolutely okay so so and revenue is again somewhere up there around 60 per month so you're spending total each month about 110 000 exactly okay any marketing channels that are really working for you conferences spend sponsorships yeah so i am an invited guest a speaker at conferences at least once a month which is really a great strategy because usually you don't have to pay to go if you're a speaker on the agenda it's good to be uh deeply experienced in the field you're working on also we have unbelievable surprisingly shocking success with linkedin sales navigator uh we get great contacts we've we've honed in really closely on our sales persona and their titles and what's the title uh supply chain sustainability lead manager director but really those are the three words they demonstrate for us that um so in a recent survey of global 2000 ceos uh 80 said they believed that climate change was an existential threat to their business because of supply chain management correct that really can disrupt or or investment management whatever those pieces are so that's that sales persona for us means that the climate change risk is moved out of marketing um and moved really into enterprise risk management a core business component i love that okay good so linkedin sales navigator is working are you doing any paid stuff anywhere pay marketing sales no okay so most that expense is headcount correct almost exclusively we're an ai company so really deep tech we have a lot of development that we do yeah five out of five engineers so probably too too early to talk about churn and expansion correct so we've only lost one customer uh gov tech customer job change they left but so so far so good pretty early though yeah but i mean that's probably i mean that's less than five percent of your revenue because they're only paying 1100 1500 bucks a year exactly yeah interesting any expansion revenue like you set up an enterprise customer 100 grand a year they've already expanded 180 grand a year not yet but we have uh new features rolling out new product rolling out we anticipate that to be a huge part of our our go to market strategy we'd like to get these uh uh subscriptions up in the million dollar range within 24 months and what what pricing axes do you think can upsell against is it a feature-based upsell a utility-based upsell seat based upsell i think it's a feature based a product based uh so we have this sort of core product offering you want integrations you want advanced data capabilities you want more ai one of the things we've really invested deeply in is a mitigation or resilience strategy ai component so if you have an idea we have this huge risk what do we do we essentially have a smart recommendation engine that does really robust cost benefit analyses that's a really high level feature that we think people will pay for guys so fast forward three years from now your prediction is you will have less customers but paying much larger accounts you won't be like a million customers paying 10 bucks a month we uh a million dollars a year uh 50 customers would be great let's move towards a thousand customers yeah that sounds good do you have a sense of what it costs you fully weighted yet to get 160 000 acv account we don't no not yet not as much as not as yeah too early uh not crazy though and uh in the true sas model cheaper as we go yeah very good all right let's wrap up here with the famous five number one favorite business book uh powerful by patty mccord loved that changed everything i thought about a team number two is there a ceo you're following or studying oh martha stewart she's my number one always will be always has been i've subscribed to her magazine since my very first job when i was 15. i think she is the first female ceo who really created a category and executed on it beautifully number three what's your favorite online tool for building your company oh hubspot gosh uh they are incredibly generous to early stage startups they give and give and give and are so kind uh yeah love them number four how many hours of sleep to get every night uh six to eight depending i try hard that's good that's all that matters and what's your situation married single kids i am partnered with three kids i have three sons eleven nine and four busy busy busy okay and you might be asking how old you are i am 39. take us home just one a uh denver's uh 40 under 40 40 under 40 squeaking in with like a quarter left yeah i gotta say you got like you got like i don't know how close you are but you got maybe four to 12 months left in that right exactly it was like whoo right under all right last question what do you wish your 20 year old self knew oh don't take that student loan not worth it don't do it how big how many how much in student loans did you have oh gosh i don't know how much is left i think i went out of state for undergrad and graduate i probably had 250 000 to start yeah don't recommend it don't do it it's not worth it it's a lot guys geospisa dot us helping big brands manage their supply chain risk by looking at climate data they're burning and spending 110 thousand dollars per month right now they look to scale but they have three customers at 170 thousand hundred sixty thousand dollar acv so call it half a million bucks in are hoping to double triple that year over year team size of seven people a million raised in equity another five hundred thousand bucks in grants being considered for another three million as well from like the national science foundation too early to talk about economics they've only lost one early customer that was just paying 1100 bucks per year but in the meantime sarah we're rooting for you and thanks for taking us to the top thanks you guys know i fight like heck to get these data points for you from these ceos that rarely do these kinds of shows if you want more shows like this make sure you subscribe right now we're trying to get 10 000 youtube subscribers by the end of september here 2019 and it would mean the world to me if you clicked now to subscribe additionally i've got two more great interviews for you if you want more data points from the world's leading sas ceos click and watch one of them right now