Limecraft Revenue, Valuation & Funding (2024)

hello everybody my guest today is martin verowasties the founder and ceo of a company called limecraft dedicated to giving media professionals the best solution possible to manage their digital workflows before this as a program manager for the r d department of vrt which is the belgium public service broadcaster he introduced several innovative technologies in the business including ai for computer assisted manufacturing and automatic indexing of audio video visual media martin are you ready to take us to the top yeah sure all right what is lime craft and how do you guys make money what's your revenue model minecraft is an online cloud-based platform for producers of audio visual material television film the high-end stuff it's an online platform because it's a world of more and more freelancers and and co-producers and traditional software can't cope with such flexibility so admitted when we incorporated minecraft in 2010 it was still a bit early our customers were a bit afraid to delegate the management of their assets um to a third party but by now we're really overwhelmed by uh some of the largest brands out there that are looking for an online solution to manage their digital workflow um and we basically uh software as a service so we charge per user and per hour of video which makes it for them very easy to scale up additional services and wind down some of their use if necessary do you have a bunch of churn we've lost one customer to date well what about downgrades you just said it makes it easy for them to upgrade or downgrade so even if you didn't lose a customer they could still downgrade yeah that's that's true an independent producer might at a given moment might be running uh six seven shows in uh in parallel in production and post-production so the editing um and then they go into selling in and visiting attending film festivals and so it's a it's a cyclic movement and it it is absolutely uh we see some customers uh going up to very large volumes and then six months later uh throttling down the volume used but that's not the real issue it's a scalable system we don't care as long as they come back afterwards well and that's the key right as long as they come back afterwards like that that's that's my question to you is any sas company that's going to drive to really large scale has really intelligent pricing axes and yours is around number of hours a number of seats which are both very strong things to build around what i'm trying to get a sense of is if you look at your cohort of the customers that signed up say 12 months ago you maybe saw you know those people you know expand that revenue stream expanded by 40 percent but then you also had about 10 percent churn so net it was 130 growth i mean do you break out those metrics um yeah it's it's not an exact science we try to get yeah yeah we do no we do okay um if um if we have unexpected uh throttling investigate what's happening uh to see whether they're not satisfied with the service um whether they had an accident with their content it's key for us to understand what happened as long as they uh just why an attention come back we don't consider it as chun and uh we will help them the next time well but martin how do you know so if i can if i churn today how do you know if i'm going to come back in a year like how do you know whether to count that or not you don't know if i'm going to come back or not how do you manage that um we actively monitor the or we we monitor the the the user's activity so it's a bit of a big brother type of monitoring activity but when a producer is paying for 100 seats and not using them properly they're a churn candidate then then we we um just give them a call yeah interactively and ask them what's going on and how we can make uh give them a better service well maybe by the way maybe this isn't a big problem i mean what what has your revenue turn been over the past years at 5 10 or higher um the the revenue churn is uh literally noise on the signal uh what's the percentage though um hard to measure nathan we're we're tripling uh our revenue uh every 12 months now um and it's uh very hard to measure um [Music] negative turn yeah okay so you have net negative turn no we are tripling um the number of users and and our revenue uh to date net negative churn means means that it means your expansion revenue is more than outpacing your churn so it means you're growing correct yes so do you i'm trying to get a sense here if if this is something you're just it's not something you measure because it's too difficult it's something you really care about but just don't for privacy reasons don't want to share the numbers or it's just something you're not you're not tracking and you don't know it's something we're not tracking because the the the impact of of is is just not worth the measuring i see um i see okay very good okay let's go back let's go i want to put this on on a on a timeline real quick when did you launch the company what year uh we incorporated in 2010. and what were you doing i mean did you were you in film and you quit and said i'm sick of editing with things all over the place in hard drives i'm making a cloud solution an excellent question i was at the other side of the table i was lead engineer of the the research and development department at verte so i was personally responsible for digitization of their newsroom procuring a piece of software that we spent millions in in copics and 18 months in implementation and i said to my fellow colleagues who co-founded the company hey guys give us um just a fraction of that cost we build it from scratch and that's because the world of media production is has been completely disrupted and has fundamentally changed and uh our customers uh that sometimes still try to tackle it with a software that has been designed 20 years ago to manage a tape archive that's not suitable for a file based workflow yeah i know martin by the way you don't have to sell me on the product i get it i totally understand why there's a need for this um let me ask a few other questions here so you mentioned different size clients give me a general sense here i mean are we talking actually you mentioned at your past company they put a million bucks into this thing doing it you know themselves customers paying you today on average what are they paying per year are we talking like a grand or a million or a hundred grand what size usually between uh 10 and 20 000 uh monthly okay fair enough that's great and how many how big are those teams typically does that get them 20 seats or 100 seats or what uh depends on the type of customer when we're dealing with an independent uh producer no no but let's do the one that you just gave me though so if i'm paying you 10 grand a month what am i getting for that that's uh 500 users per month as a starting point and we're now scaling into bigger bigger companies and how many hours of film uh going from from uh two three hours per day for regular production to uh 200 hours per day for a post-produ large post-production system sorry sorry if for someone paying you 10 grand a month about how many hours will they be getting or using um that's the the customer who's uploading 175 hours of content per day holy mackerel okay that's a lot all right uh very good so 2010 walk me through kind of how you've capitalized this so have you bootstrapped the company or raised uh we bootstrapped the company apart from some angel funding uh in in a very early stage okay so how much raised to date including the angel funding we we have uh in total one million uh euro so uh 1.1 million dollars on the balance yeah um in europe it's a challenge to get venture capital for anything which is dealing with the media business media is considered toxic yeah it's hard difficult to make money in it though i think um it's it's uh explosive um you know media is not media production is not just uh making film and television anymore companies like netflix and amazon spend good money in original production uh it's it's becoming another building and more and more corporate uh is netflix the customer no not yet come on martin love to have them as a customer personal studios as a customer that's okay that's good very good how much and how many customers have you scaled to today total [Music] uh in total i think were 30 35 um mention worth mentioning 35 you said bigger ones there is you know we have a whole cohort of really small producers including video and podcast producers they're there the system is scalable to the smaller numbers as well but we can't count them as individual customers like the the bigger ones okay so you have about 35 meaningful customers you said earlier kind of from price point perspective 10 to 20 grand a month if we stay conservative there at 10 grand a month 10 grand times 35 it mean you're north of 350 000 per month at this point in terms of revenue is that accurate no yeah half of it half of it okay and why is that there's a low it's a lower price point or what no because some of them are ramping up in uh in the uh first six months they will be gearing up uh one production team after the other one um it's a volume-based pricing so um in the first couple of months uh price point will be overall price point will be lower okay got it so you're doing 175 000 a month today uh you're three xing year over year so a year ago you were doing what about sixty thousand a month something like that uh debt was a while ago yeah well you said you're growing three x year over year correct you're tripling revenue each year this is our current pace yeah okay so if you're at 175 today 175 000 that would mean you're at about one-third of that a year ago is it accurate uh yeah sort of okay why sort of and not yes the the the first um [Music] we've um we've meaningful statistics since um since uh 12 or 18 months we spend a lot of time in developing that's a disadvantage of bootstrapping your uh your platform um we came from smaller independent producers into broadcast style of customers with a couple of hundreds of seats and we're now in moving into uh really large players with a couple of thousands let's see that's only been happening the last 12 months okay so it's uh did you have no revenue so if you go back a year ago did you have no revenue per month at that point were you pre-revenue a year ago a couple of ten thousands per month but uh not meaningful and part of it was custom development yeah it's only now that we're correctly measuring monthly monthly recurring based on on the platform and that we're actually tracking the objective of uh doubling every four or five months martin we're short on time so i don't mean to keep cutting you off but i want to get a bunch more in so just to be clear the 175 000 you're doing per month today that's all sas revenue correct okay great and then um talk to me about team size how many folks are you today 14 and where's everyone based kent all in belgium belgium very good and uh and uh obviously you raised 1.1 million a long time ago are you guys are you cash flow positive today are you still burning nope would cash flow positive since uh six months congratulations any plans to raise capital right now no not at all yeah you like the bootstrap light you like like no more no more investors we we uh took been becoming cash flow positive as a as an important challenge this is eventually where a company wants to uh that's the objective the company wants to achieve despite anything which um goes in in press this is what we achieved uh we we now have um sufficient funds uh over which we will invest back in the company that's great so um uh our shareholders now think that it's uh key to grow the company organically for another six to twelve months and then we'll see what uh what happens very good martin let's wrap up here with the famous five number one what's your favorite business book good strategy bad strategy number two is there a ceo you're following or studying nope number three what's your favorite online tool uh it's probably slack number four how many hours of sleep to get every night between four and five four martin that's nothing i know all right and what's your situation married single kids divorced divorce okay no any kids two kids okay yeah you got a full plate then and how old are you sorry how old are you i'm 45 45 last question what do you wish your 20 year old self knew say it again what's something you wish your 20 year old self knew oh i don't have a clue i should have started earlier guys start earlier who came out of the broadcasting rooms and these big media companies and said you know what if they're going to be spending a million bucks on custom solutions for managing all these media files i'm going to build it ourselves that's what he did he left the company now he's building a company doing about 175 grand per month at 35 customers paying about you know anywhere between 5 and 10 grand per month founded in 2010 now a team of about 14 people in belgium raised 1.1 million bucks to do it cash flow positive a little over a year ago 3xing year over year they're not measuring churn it's you know it's small to the point where it's not something they're focused on however they're looking at scaling over the next six to 12 months and then deciding at the end of that what they want to do next martin thank you for taking us to the top thanks a lot nathan