How journy.io Raised €450K and Landed Its First Paying Customer at €100 per Month (Interview with Co-Founder Hans Ott)

Introduction and What journy.io Does

Nathan Latka

00:00Hey folks, my guest today is Hans Ott. He's a software engineer with a strong interest in domain driven design and functional programming. Deeply in love with clean code, and he'll do anything to motivate other developers to leave the campground cleaner, as they say. He's now building journy.io. That's with no e helping you better manage customer data across all your teams. Hans, are you ready to

00:21take us to the top?

Product Overview: B2B Customer Data Platform

Hans Ott

00:22>> Yes. Yes. So journy is a customer data platform. We're especially focused on the B2B. So, we basically collect data from all kinds of sources and then we, create like unified customer profiles of users and accounts within your product. We and then you can use this data to calculate like which customers are healthy and which kind of stage they are. Are they qualified for your product? Like have they tried out this feature,

00:51>> this feature? And then basically try to detect churn and then sync all this data back to all the tools you're already using like your CRM like HubSpot for example or Intercom for chatting with your customers. And so we want to share all that data all build this intelligence in one place and share this knowledge to all the tools you're using.

How journy.io Integrates with Segment

Nathan Latka

01:15You can add really interesting elements to each of our customers'profiles. For example, tell me which ones have a healthy score, who's gone through the onboarding, what they pay, who needs attention, things like that. One of the things that you're able to give feedback on is, is the onboarding done or not? How are you able to give other software companies that kind of intelligence? Do they have to install a journy JavaScript on their site?

Hans Ott

01:35>> Yeah, there are a couple of ways you can do it, but a lot of organizations are using Segment already. Do you know that? Yep. Yeah, so they send already all their data, all their analytics to Segment and we are basically like a destination. So you can immediately, like with a few clicks, you can attach all your analytics data to us and then we receive this and build these

Nathan Latka

01:57So someone someone listening wants to use journy would attach their segment account to journy and that's how you're rating their customers?

Hans Ott

02:05>> That's that's the fastest way, but of course we also have our own APIs and SDKs that you can use to integrate or to send your analytics data to us.

Early Customer Traction

Nathan Latka

02:14How many companies have connected their analytics to you?

Hans Ott

02:18>> Well, we're still like in an early phase in that regard. So we spend a lot of time trying to think. We originally started as like an attribution platform. So which channels and campaigns bring you the most and best customers. But we pivoted it to this customer data platform and so that took a while and to build like all these things and get it like there is a lot of technical stuff involved and so it took a

02:48>> long time to build this great platform. So there are a lot of moving parts like you have. You need to have this segment destination.

02:57>> Need What's have the number?

Nathan Latka

02:59How many connected accounts?

Hans Ott

03:01>> Yeah, there are a few accounts onboarding. So and one paying customer.

Nathan Latka

03:07Hey, we love that. You shouldn't be shy to share that. Everyone has to start at zero. Okay. So you have one paying customer and how many connected accounts you said?

Hans Ott

03:15>> And there are a couple of accounts onboarding right now. Trying out our integration.

Nathan Latka

03:22And what is the one paying? How much are they paying?

Hans Ott

03:25>> Well, they are not paying. I think I don't know the number by not exactly, but they're they they don't leverage like all the features that we have right now. And we're trying to push that, of course, that they use all kinds of features. They didn't integrate their product yet, but so I think they are paying €100.

Nathan Latka

03:50Okay. So about a 120 US dollars per per month, which is great. The reason I ask is this is like a magical moment every founder has to go through is what pricing do you launch with? And obviously you're going to experiment a ton over the next, you know, many months, but why did you pick this price point to start?

Pricing Model and Contact-Based Scaling

Hans Ott

04:05>> Yeah. So it's based on the number of contacts that you have because for every contact we have to keep recalculating things and so forth. And so it's based on the amount of contacts that you can play with a slider on our website to see what kind of price you would pay. So

04:26>> it scales with your customer base basically.

Nathan Latka

04:29Yep. So 20,000 contacts would be about €1,000 per month. What's the math behind this? Is it just a ratio you're applying?

Hans Ott

04:35>> Well, looked at other people who are in this space compared with our pricing and we're actually a lot cheaper than most platforms out there. So I think we have a great pricing at this moment. But of course, we still have to test and play with this, of course.

Competitive Landscape

Nathan Latka

04:57Who do you compete with directly?

Hans Ott

05:00>> We compete with like a number of, I think, customer success tools like there is Vitally or Salesmachine. I don't know if you know them. So a couple of products that are, but they are really focused on the customer success side and we want to take it broader than that and also focus on the sales because if you have a customer onboarding, some customers try the right features and then your sales can focus on the right customers

Nathan Latka

05:33because if you have a

Hans Ott

05:34>> long list of customers you need to call, you want to prioritize and sort them by their adoption score or whatever.

Nathan Latka

05:43Hans, when did you write the first line of code for journy?

Company Origins and the Pivot

Hans Ott

05:47>> I think it was like almost two years ago, I think. But we were still, my co founder and I were still having other jobs. And so it was kind of a side project. And then at some point we decided, okay, we want to take this further, work on it full time. And then we found the seeding and then did things.

Seed Round Details

Nathan Latka

06:13Oh, did raise a seed round of capital?

Hans Ott

06:16>> Yes. Yes.

Nathan Latka

06:17How much did you guys raise?

Hans Ott

06:20>> 450,000.

Nathan Latka

06:21Was that last year?

Hans Ott

06:23>> It was like in February, I think.

Nathan Latka

06:26Okay. Of this year? Yeah. Okay. And did you raise that on sort of a cap or a note or a priced round?

Hans Ott

06:35>> Well, I don't know if I can share these details.

Nathan Latka

06:43Was there a valuation attached or was there a cap on it? Like was it debt, a convertible note?

Hans Ott

06:47>> It was a cap, What a cap?

Nathan Latka

06:49Oh, I see. I see. So obviously driving evaluation when you're pre revenue is all about your ability to tell a really good story about what you could build, the value you could create. So what valuation did you end up raising the 450,000 at?

Hans Ott

07:02>> I don't know these exacts actually.

07:06>> Yeah. Because my co founder is more focused on this part, but I don't know the exacts about it. It's been a while since I looked at these things.

Nathan Latka

07:16Hans, I mean, I mean, I imagine someone listening right now is going go, wait a second. This is the co founder of a company. They raised capital and this guy doesn't know how much of the company he sold in the round. He doesn't know the valuation. Would be like one of the main things that every early stage founder would make sure they're focused on is minimizing dilution.

Hans Ott

07:31>> Well, since we didn't, how do you say this?

07:40>> Well, I don't know if I can share these things.

Equity Split and Co-Founder Dynamics

Nathan Latka

07:46Well, how much of the company do you own? Let's just talk about your own stuff.

Hans Ott

07:51>> Well, don't want to share this knowledge either.

Nathan Latka

07:56Okay. Many did you find this yourself or how many co founders do you have?

Hans Ott

08:00>> Well, we're with two co founders. And so we started the company on ourself and then we found the seed.

Nathan Latka

08:08And did you guys just agree at the beginning, just split it right down the middle or did one of you guys take more because you were investing your own money or leaving a bigger job or something like that?

Hans Ott

08:16>> Well, it's very

08:22>> even, I would say.

Nathan Latka

08:24And why is that? You know, sometimes people don't split evenly, sometimes they split it evenly, but why did you guys decide on even?

Hans Ott

08:32>> Well, we think we're both in this journey together, so it's important that we're both as even invested in this project. And so that's super important that we can trust each other and that we are willing to fight both for for the same reason.

Why They Raised Instead of Bootstrapping

Nathan Latka

08:52Why did you have to I mean, this doesn't sound like a huge technical problem. You're connecting basically to a segment API feed and then making it look pretty with these customer cards. Why did you have to go raise capital and sell equity to get this going? Like, couldn't you use, you know, a little bit of savings or pre sell some customers?

Hans Ott

09:08>> Because there are like a lot of moving parts and you're syncing to CRMs and you don't want to mess up any data because often these systems don't have any

09:22>> backup systems or some companies use. But often, like your CRM has only this one version and you can go roll back. And so you don't want to mess up this data. And so we're really focused on building a great platform and there are a lot of moving parts in it. You have to build these great APIs that you can use in your product. The developer experience has to be good and so we needed a lot of

09:49>> functionality to come. It doesn't look like much from the outside but there are a lot of things that you need to solve and like identity resolution and all those kinds of things, basically.

Nathan Latka

10:01Mhmm. But there's I mean, what you're kind of what you just said is you want to build a great tool, you have to raise money.

Hans Ott

10:05>> I can

Nathan Latka

10:05tell you there's a lot of great founders that do not raise money. They pre sell the idea and they fund themselves and keep all the equity. Why didn't you go that path? Does anyone do either you or your co founder sell? Are you salesperson?

Hans Ott

10:16>> Yeah. Eve is more the commercial minded person, but he was also a programmer in his early days. So he knows a lot about the technical stuff as well.

Team Size and Managing Burn

Nathan Latka

10:27How many folks are on the team now today? Just the both of you?

Hans Ott

10:30>> No. We're with five full time people working on a product. And then we have some other very talented students who are also like entrepreneurs working for us. And so, yeah, we're doing it with that team.

Nathan Latka

10:47If we're being conservative and say five full time people at very small salaries, right? You're spending $20,000, $30,000, $40,000 a month on headcount annually that burns through all of your seed money. Right? Does that make you nervous? And how do you manage burn?

Hans Ott

11:02>> Well, we're very confident about we don't worry about that part. Of course, there's always some worrying. I guess that's normal, but we're seeing this space and it's growing and it's a really cool place. Yeah, like market to be in. And so we're not that scared that we're going to run out of money eventually. So we just want to focus on building that product and finding the customers and making them happy and then it will come.

Activation Metrics and Customer Conversations

Nathan Latka

11:35Where, where, what do you know? You mentioned you have four people on pilots right now. What activation metrics do you know that they need to hit in order to increase likelihood they start paying?

Hans Ott

11:46>> Well, I think it's like how quickly can they integrate with our APIs? Are they getting the right amount of actionable knowledge about from that from this data?

Nathan Latka

12:01How do you measure that, though?

Hans Ott

12:04>> Well, of course, we're using our own tool to collect data from our customers. We're using our own tool. And so in that way, we can also play with our own features and know what we have to improve. But other than that, it's it's still finding like a bit that market fit and what are the features we have to focus on and a lot of talking with the customers and seeing what they are interested in to know

12:37>> what kind of insights they want to know, what kind of insights they want to send back. And so it's still a lot of figuring out right now.

Nathan Latka

12:45And Hans, over the past seven days, how many customers have you talked to?

Hans Ott

12:52>> I'm not sure. I think about like seven or something like that.

Nathan Latka

12:59And what's your process? You get on Zoom, you ask them questions, you write down what they like and say they're willing to pay for what the process look like.

Hans Ott

13:05>> Yeah, we we try to design like a survey that encompasses like all the right questions like what kind of tools you use right now, what kind of CRM do you like, would you like to see which stage a customer is that it automatically goes from this stage to another stage and so forth? And so

13:32>> they need to push their business further and to break down those boundaries between like all the teams, the customer success and the sales and so forth.

2022 Goal: 50 Paying Customers

Nathan Latka

13:44Very cool. What is your guys'goal for next year? What revenue do you hope

Hans Ott

13:48>> you guys will hit?

13:50>> Well, I think our targets were to have like 50 paying customers. So but of course it will be more than that that we want. But right now we're just focused on finding the right feature sets and finding the right customers that can support that.

Nathan Latka

14:12Hans, on that note, let's wrap up

Famous Five Rapid Fire

Nathan Latka

14:15with the famous five. Number one, what's your favorite book?

Hans Ott

14:19>> It's Atomic Habits.

Nathan Latka

14:20James Clear. Number two, is there a CEO you're following or studying?

Hans Ott

14:25>> Yeah. I'm very fan of Nat Friedman, the CEO from GitHub.

14:32>> Yes.

Nathan Latka

14:33I'll just say GitLab or GitHub?

Hans Ott

14:34>> GitHub. Number three.

Nathan Latka

14:35What's your favorite online tool for building the business?

Hans Ott

14:39>> GitHub. Besides GitHub?

14:41>> I think it's

14:48>> you surprised me. I think it's my editor right now because I've wrote a lot of code for that. It's like beach peace storm. That's what's that's the name

Nathan Latka

14:57number for how many hours of sleep do get every night?

Hans Ott

15:00>> Eight.

Nathan Latka

15:01And what's your situation on? Are you married, single, kids?

Hans Ott

15:05>> I have a girlfriend and we have two cats.

Nathan Latka

15:07Oh, okay. How old are you?

Hans Ott

15:09>> I'm 27.

15:11>> 27.

Nathan Latka

15:12Last question. What's something you wish you knew when you were 20?

Closing Thoughts and Wrap-Up

Hans Ott

15:15>> That it's never too late to start learning anything. Like I'm very busy with music as well. And so I should have started earlier with music. I kind of realized this very late. And so it's never too late to start learning anything basically as long as you're passionate.

Nathan Latka

15:34Guys, journy.io helps you understand which customers are hot, which ones need help. Tie to your segment data and other data sources to tell you that. Started as a side project in 2019, raised some seed capital in February this year, $450,000, and just landed their first paying customer, which we love at a $120 a month, hoping to hit 50 paying customers in 2022 as they look to scale with their team of five. Hans, thank you for taking

15:56us to the top.

Hans Ott

15:57>> Thank you.

Nathan Latka

15:59One 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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