How Intervue Hit $7,000 MRR With 30 Paying Customers (Interview with CEO Rahul Arora)

Introduction and Background

Nathan Latka

00:00Hey, folks. My guest today is Rahul Arora. He's the founder of product and growth guy at intervue. Io, I n t e r v u e. Io. He's been the engineer for seven years before this and took 500 plus tech interviews in two point five years as a hiring manager to realize gaps in the recruitment process. That's how he got this idea, now building and hoping to help make it easier for people to hire better and

00:24faster. Rahul, you ready to take us to the top?

Rahul Arora

00:27>> Yep. Yep. Absolutely. For being here.

Focus on Tech Hiring

Nathan Latka

00:31So real quick, are you focusing on hiring any specific job title? Are you helping companies hire any kind of role?

00:39Well, right now, I'm a strong believer in making something for someone before we make everything for everyone. So we are starting with tech roles. We'll eventually move to non tech as well, but right now tech is the focus for the next few months.

00:50So you're helping people hire engineers?

00:52Yes, that's correct.

Business Model and Launch Timeline

Nathan Latka

00:54I see. Okay. Give me a sort of a backstory here. When did you guys launch the Marketplace and how are you making money? Is there a SaaS product embedded here or no?

01:03Yeah, it's a SaaS based model. It's a subscription just like subscribing to Netflix. We launched it when I was working part time. The MVP was launched, I think, one and a half year from now, but it's been ten months. We are full time funded. And now we've got quite an adoption from India and looking into some adoption from US as well. Although some US companies are also using it. But companies do pay a subscription fee to

01:27use the platform, and then there is a finite number of interviews that you get and the number of PMM will begin to to the plan.

Capital Raised and Investors

Nathan Latka

01:32Okay, and how much total capital have you raised to date?

01:38We have raised a pretty small round. Yeah,

Rahul Arora

01:43>> sorry? When did that raise?

Nathan Latka

01:46I think about five months ago, five to six months ago.

01:50Okay, got it. So this year you raised $120,000 Now, was that from friends and family? Do you remember?

01:56Yeah, that was an angel round done by an Indian VC firm called Titan Capital. And then a couple of US investors as well. Brendan Rodgers, who is the founder of Vag, along with his partner, Harshal Mehta. And then there's another Indian entrepreneur, very popular, Punal Shah, is the founder of Credit.

02:15I see. And what was the valuation?

02:18I think close to a million.

02:20Okay, a million dollars. And now were you guys pre revenue at that point or did you have money coming in?

02:24We had a very small revenue, 400 a month.

02:27Dollars 400 a month. Wow.

02:29Okay. Where

Monthly Recurring Revenue

Nathan Latka

02:31are you today? How much monthly recurring revenue?

02:34We are doing approximately $7,000 a month.

Customer Example: Zomato

Nathan Latka

02:39Congratulations. Okay, so help me understand. Give me a customer example. Why are they paying you and how much they pay?

02:46Example is this company called Zomato from India. And they are paying us because we are helping them streamline the entire tech hiring process, helping them filter a lot of candidates before they actually line them up for interviews. And we are also saving a lot of their engineering bandwidth because our software is very optimized to take interviews. Now, typically an engineer would spend around an hour, one and a half hour to take an interview to complete an

03:11interview. In our software, it is so convenient that you can wrap up the same interview in about forty five minutes without having to give any trouble to the candidate. And the candidate experience is also top notch. So this company is paying us around close to $1,800 a month.

03:27And that's your biggest customer?

03:29That's our biggest customer so far, but yeah, there are three to four more coming up very soon.

03:34That's great. And how many customers total today?

Total Customer Count and MRR Breakdown

Nathan Latka

03:37So we have a total of approximately 90 plus customers to narrowed down to a particular number. Nine

03:48zero. Yeah. Out of which few of them were early adopters. So they are kind of on lifetime deal. But some of them close to about 30 odd are recurring paying customers, which constitute a part of $7,000 MRR.

04:05Yes, 7,000 MRR divided by 30 customers. Each one is paying about $240 per month, correct? Or about 200?

04:11That's correct. That's correct. Yep.

04:13Interesting. Okay, walk me through how you got your first 10 customers.

How Intervue Won Its First 10 Customers

Nathan Latka

04:18Great. First 10 customers was quite a hustle. I remember, you know, I was a hiring manager in my previous company and the idea resonated with me so much because there were four key problems that we faced. The data in the recruitment was not centralized. It was scattered across multiple platforms. Whenever I went back to my HR to ask for, Hey, can you tell me about this candidate? It took them a lot of time just to search

04:42for that data. Secondly, it wasn't very convenient to take interviews. It was very annoying. I used to facilitate one or two interviews every day. And the first ten minutes of every interview used to go into, know, wasting into preparing the runtime environment and waiting for the candidate to be hands on and be up and ready with all the tooling. And that became really annoying. So I was a hiring manager. I thought that I need to find

05:07people like myself who are equally annoyed and are taking interviews every day. So an ideal customer profile for me back then was a hiring manager of a hyper growth team. So I started finding people who are look alikes just like me. And I called

05:22You were on LinkedIn searching for hiring managers?

05:24Yeah. I did a simple search for companies who are hiring and then the companies had to be progressive. So I went to their Twitter handles, I went to their LinkedIn, emailed them and messaged them on Twitter. Some of them were kind enough to respond and they tried the product. Eventually, one or two months down the line, they ended up onboarding the product.

05:42I see. And you had your first dollar of revenue this year, 400 a month, and now you did a seed round, right?

05:50Yeah, that's correct.

05:52Walk me through the team today. How many people?

Team Composition

Nathan Latka

05:55We are a nine people team right now, and a couple of people will join us in October.

Rahul Arora

05:59>> So that'll make an enablement team. Engineers? Yeah.

Nathan Latka

06:04We have about five five engineers in our team.

06:07Okay. And any sales reps or no?

06:10Yeah, we have a couple of people who does sales. But largely, largely, we are doing a lot of content based organic stuff, as well as making a lot of code outreach happens at the site as well. And we are also figuring out other marketing channels side by side.

06:27Are you still targeting hiring managers on LinkedIn? Is that still a focus?

06:31We are targeting hiring managers. So the salespeople, they make sure that they do cold email and they reach out to people on LinkedIn, etc. But at the same time, I also make sure that I'm vocal enough about what we are building over social media platform. And from there, we get certain sort of pull. And then we get some inbound leads as well from our organic channels.

Rahul Arora

06:53>> Yeah. Why can't people just

Nathan Latka

06:55use Zoom for this? Mean, the big call to action on your website is basically that people can watch candidates code live, it's like a little Zoom video chat with a coding interface, and you have customers like Cisco, Workspano, Rakuten, Walmart, and IBM. Are they all paying customers?

07:10Yeah, most of them are paying.

07:11Okay. And so, yeah, why can't people just use Zoom for this and then screen share?

07:15Oh, yeah, I'll tell you. So typically, when you get on a call with a candidate and you have to take their tech interview, you ask them to share their screen. And they share their screen, open the code editor and prepare that runtime environment. And you might want to test them out across multiple programming languages. It might be a Java, JavaScript or React. And preparing all those environments might take their own speedy time. And that's where Zoom

07:40does not help. Zoom will help you do the video calling part of it, but it won't help you prepare that run time environment. And a tech interview only requires a run time environment, especially when the interview is hands on. That's only one aspect of the interview. The second aspect of the interview is you want to see the interview later on. Because a lot many times engineers do not submit the feedback on time back to the hiring

07:59team. So when the feedback is not submitted, the hiring team does not know whether the candidate has been selected or rejected and what was the reason of selection. Because that is not there, because Zoom in a software is just there to facilitate video calls, you have to go to another piece of software altogether. It might be a Gmail or a Google Sheet to submit that feedback. And that is pain taking for an engineer because they would

08:19hop on to another call or get busy building their product. So no one would submit that feedback on time. Our product does it all automatically. When you take an interview on Intervue, the code editor is inbuilt, as well as when you're taking notes, they get auto submitted and hiring manager will send a notification.

Cap Table and Equity Split

Nathan Latka

08:34Understood. And talk to me about your cap table today. How much equity do you own?

08:38Right now, the founder's equity is around 88, seven. Yeah, to be exact. 88%?

08:48Yeah. You're one of the founders, correct? How many founders are there?

08:51We are a couple of founders right now.

Rahul Arora

08:53>> How many? Two.

Nathan Latka

08:56There's two of you guys. Okay. So two co founders.

08:58Two of us.

Rahul Arora

08:59>> Did you guys split

Nathan Latka

09:00the 88% equally?

09:02No, no, no. It's not equal.

09:04You have more?

09:06Yeah. Yeah.

09:07Tell about that. Is that a weird conversation? Hey, come join my team, but I want to keep more equity.

09:12No, it's not. It's actually not. I like to be fair there.

09:18Basis, whatever you put on the table and how much fire you have in the belly and what you're going to do, what things are you going to handle. It's that sort of a conversation. It's never that I always would like to own a smaller part of a watermelon than owning a larger part of a grape. That's my mindset. But yeah, be honest, I I like to be fair. There there there'll be more people joining in for

09:37sure on the capital.

Rahul Arora

09:38>> Do employees own any of Sorry?

Nathan Latka

09:42Employees own any of the company right now?

09:45Yeah. They they all the employees have ESOPs. So do have indirectly, they do have a part of the company.

09:52So if on a fully diluted basis, how much equity do team members own right now?

Rahul Arora

09:58>> 10%.

Nathan Latka

09:5910%. Okay. So that's 98% of the business. So the 120 what thousand about that equity? What do the investors own?

10:06Oh, no. So the Founder's equity was inclusive of ESOPs, actually. But if not include the ESOPs, it would be 78 Right? Because ESOPs constitute 10%.

10:17Yeah. Got it. Founders own 78%, you own the majority at 78%, then employees own 10%, and then investors own 12%.

10:24That's correct.

Cash in Bank and Burn Rate

Nathan Latka

10:25I see. Cool. Okay, how are you Tell me about how you're managing cash in the bank. So how much cash in the bank today?

10:33Close to whatever we raised. It's almost that much amount only because we almost

10:40This all that made no sense at all. So how much cash in the bank today?

10:46It is close to 100 ks or more than 100 ks, I would say. I'll tell you. The

10:54runway?

10:55You bet, Kagar, how much are you burning per month?

10:58We're burning about

11:02every time you ask me this question, have to convert it in dollars. So I just take a quick step back. But we are burning about $5,500 a month right now, but it will go to $6,500

11:13So are you looking to raise more capital here shortly or no? You're just not raising any more?

Plans to Raise $6,000,000

Nathan Latka

11:17We are looking to raise around north of 6,000,000 in the coming in the coming days, I would say.

11:26So you want to raise $6,000,000 at what valuation?

11:31We have not really decided honestly that. In in the coming ten days, we would be finalized on that number. But we have decided on a number that we want on board for sure because we have backtracked it to the team members that we need on board to speed it up more.

11:45So you want to raise, you're deciding the next ten days how much you want to raise in the valuation, but you know the amount you want to raise is $6,000,000

Rahul Arora

11:50>> Yeah, that's correct.

Nathan Latka

11:52So let's say you only want to sell 20% of the business. That means you have to raise it like a $30,000,000 valuation, but your revenue is only $7,000 per month. Do you think you can get investors to pay a significant multiple?

Market Positioning and Product Differentiation

Nathan Latka

12:03Yeah, I mean, the whole value of this thing is sometime in the future. That's one. Second is largely all of these things are a function of the kind of product you are building. And in the hiring industry, an assessment tool is born every day and there are so many other tools that exist today. And people think that it's a saturated market and the product is almost commoditized. But here's where the difference is. I largely think, and

12:27we are strongly biased as a unit, that the product is not at all commoditized. We are far away from a product that would disrupt the hiring industry. And to build that sort of a product, we need talent on board. We

12:38have just started, I would say. And all of those things are in If the

12:42you raise $6,000,000 it's going to be very dilutive. Mean, think about it. If raise $6,000,000 you're doing $84,000 a year right now in terms of run rate. So if I put into a $30,000,000 valuation, that's a three fifty seven X multiple. So if you raise 6,000,000,

12:5330

12:54pre, that's you sign, call it between 15 to 20% of the business, but that's a massive, which I don't know you'd be able to get. I think maybe someone could do $12,000,000 valuation and gives you $6,000,000 and you're selling 33% of the business. I mean, do you really want to take all that dilution?

13:09Yeah, I would just give some examples of the company that are pre revenue and have raised $10,000,000 to it now. And they are companies from US. There are companies in India that are

13:17Give me a few of those examples.

13:19So I would just name a few companies, right? Have raised bigger rounds. I would just name this company, just raised $38,000,000 round from India. Then there are companies who have raised

Rahul Arora

13:32>> What's the company name?

Nathan Latka

13:34I actually forgot the company. I met them in an incubation at an incubator. The name of the company I have almost forgotten. They were trying to make this Gmail clone. They were trying to revise

13:49what email systems have done. And there are so many other companies, right? Companies that the likes of I've seen this company from India called Vorkdoc, which is bound today is about a $10,000,000 round. Why

14:04does any of this matter though? These are very extreme outliers you're referencing and there might be some

14:08No, it does not. It does not. What I'm referring to is that the market needs that sort of an investment right now because tech talent is expensive. That's number one. Second of all, you need to have at least a couple of years of runway with that sort of money and about 25 folks on board to get the board sailing and get the product to a level where you want it to be.

Rahul Arora

14:29>> Well, yeah, maybe. But I mean, look at a

Nathan Latka

14:31company like Qualified, right? They're at a $3,000,000 They're run not raising at a $40,000,000 valuation. They're much larger than you, and they serve the same market. It's basically a coding tool for developers and onboarding ATS system. Used their community to arbitrage their growth so they didn't have to raise a bunch of capital. I'm just curious, don't you go, instead of focusing on raising it, I'll take four months of your time, why not just focus on closing

14:53more customers, getting up to $2,000,000 $1,000,000 run rate and then going out and doing another raise?

14:58Yeah, we have about five people in the engineering team today and only just three of them are full time and a couple of them are interns. So the kind of features that we want to build and those are big, big differentiators. It won't just improve the product 10%, it will take us from zero to one. Those sort of features are way into the future, and we cannot just build them in three to four months of time.

15:20Cool. Okay, that all makes sense. You know your numbers, though. You must listen to the show or something.

15:25Sorry?

15:25I'm just saying you know all your numbers very quick. You must listen to the show or something.

15:31No, I'm just used to all of these numbers because they are on my fingertips. Because most of these times, I just keep in my back of the road, keep thinking about how much runway is left, how much do we need to raise more, and how fast do we need to go. All this time, all this is in my subconscious. So it's mostly like that. And yeah, I do watch the show. I do watch the show.

Rahul Arora

15:51>> Oh, nice. So why do you want to come on?

Nathan Latka

15:54You knew I was going to ask you all these numbers.

15:57Oh, no, no. I knew it. I do watch the show. Know your show has this pattern. I do love it. In fact, there are a couple of my team members who watch it and they knew I was going to be on this podcast and they wish me luck and they said, dude, it is too big.

Famous Five

Nathan Latka

16:14Think you did a great job. Let's wrap up with the famous five. Number one, what's your favorite book?

16:19Oh, my favorite book so far, The Mom Test.

16:22The Mom Test?

Rahul Arora

16:24>> Yeah.

Nathan Latka

16:24Number two, is there a CEO you're following or studying?

16:28Elon Musk.

16:29Number three, what's your favorite online tool for building the business?

16:32Online tool for building the business. Wow, that's interesting. I don't know. Am just using a whiteboard right now. If my background was off, you would have seen a whiteboard, which is like showing you a complete flow. Yeah, I don't have any tool in mind, to be honest. There are so many of them. Don't have any favorite.

Rahul Arora

16:47>> Microwave works.

Nathan Latka

16:48Number four, how many hours of sleep do

Rahul Arora

16:49>> you get every night? Four

Nathan Latka

16:54at the bare minimum I try. And if I am too lucky, seven. Not more than that.

16:59Married, single, kids?

17:02I am married. I don't have kids. I don't have plans for the next three years.

17:06How are you, Rahul?

17:08I am 29.

Rahul Arora

17:10>> 29.

Nathan Latka

17:11Last question. Something you wish you knew when you were 20.

17:13Oh, wow. I wish I had access to some capital so that I could have materialized my 20 in a way such that I was a billionaire today.

17:22Guys, there you have it. Rahul with Intervue.io launched back in 2019, now doing seven thousand dollars a month in revenue, helping HR teams give live coding assessments where you can see the candidate coding live along with a video thing, tag and save it for later for doing everything related to candidate management in the developer space. They've got a team of nine people right now building this. They raised $120,000 in a round earlier this year at a million

17:42dollar valuation. 30 customers today looking to scale. It might be raising 6,000,000 here shortly. We'll see what happens. Rahul, thanks for taking us to the top.

17:50Thanks a lot, Nathan. It was great.

17:53One 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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