How m3ter CEO Griff Parry grew to $6M revenue and 50 customers in 2024.

guys uh Griff sold his last company to AWS and through that process said I've got a great idea which he launched in 2020 it's called meter and it helps companies that are generally doing more than $50 million of Revenue more accurately capture and and Bill based off usage you've got to capture the product usage data then bill against it resulting in billions of API calls per year in some cases today meter is working with between call 10 and 100 customers they've got 56 on the team with quote a majority being engineers and quote plenty of Runway as Griff and his team looks to invest in the longterm hey folks if we haven't met yet my name is Nathan Latka I launched and sold my first software company back in 2015 and went on to write a book about it which you guys made a Wall Street Journal bestseller purchasing over 30,000 copies thank you so much for that after the book I launched this show and went went on to create founder path.com I raised a large fund to do non-dilutive deals with B2B software Founders so far we've invested in over 400 software Founders totaling $150 million here in 2024 we're doing three to four New Deals per week so if you're looking for Capital and don't want to give up Equity go sign up at founder path.com for free to get your offer all right let's jump into the interview hey folks my guest today is Griff Perry his him and his co-founder John Griffin started meter after building and selling a backend as a service company for video games to AWS The Experience brought the challenges and opportunities of using usage based pricing into sharp Focus inspiring them to found meter an intelligent metering and pricing engine for SAS companies Griff you ready to take us to the top yes absolutely where would you like me to stop well it's great to have you I will say there's a lot of people that think the future of SAS is actually going to be pure usage-based pricing we saw charifi try and pivot into this it didn't really work that well they sold the SAS Optics we s we see sort of paddle and some others in the UK trying to capture this now stripee is a big player how do you fit into this ecosystem um I so taking a two things you said in turn I definitely don't think it's the case that everything is going to be usage based and everything is going to be um sort of an extreme variation of usage based but what creates the Tailwind um for our business is that there's been a rapid adoption of usage based pricing strategies often used in conjunction with more traditional subscription pricing so there's probably a minority concern as recently ago as you know three or four years um but now like the majority of B2B software companies are using some kind of usage based pricing you know and that's along a spectrum so you know you've got the aws's and the snowflakes of this world doing you know pretty pure usage based you've got a whole bunch of other players who are basically doing subscription 2.0 so it looks like a subscription but it's got usage based elements um it could be an allowance that you've got to track where you pay over is um if you exceed that allowance that kind of thing um and moving to your second point the reason that something like meter exists is that the the existing stack doesn't um anticipate the usage based pricing components um and so uh what they don't do is rate product usage when I say rate product usage I mean apply pricing to usage so you've got to capture the product usage and then you've got to apply pricing to it to work out how much you would pay and that's that's what meter does so meter comes along and we automate that bill calculation and so for the most part we integrate with those other logos that you're talking about because um we're doing the thing that they they haven't anticipated um and for for the most part our customers are already committed to Tooling in their Co to cash and we absolutely don't want them to rip it out we just want it to work the way it needs to now they're using these slightly different um pricing approaches and effectively we're helping then Mize they equ to cash that so I guess when I hear you say that in order for meter to work or for anyone to do you know metered pricing they first have to capture the product usage data and then sort of Bill against it those are two I mean pendo only does you know product usage and they're a multi-billion dollar company there's others that only do the billing and they're multi-billion dollar companies there you have to do both of them to sort of make this work give me an example of a customer using you today and a version of sort of usage based or product tracking that they would do in their specific business that then they bill against um so uh sift is a good example so if you know sift they used to be called sift Sciences Sciences they're they're a great business and they're doing um fraud detection for online retail effectively and the the core of um the core metric that they charge against is is based around apis so they have naturally usage based pricing um but you know they have big customers and they big customers want quite a high degree of predictability so a lot of their deals involve sort of minimum commitments which uh includes certain am allowances and sort of discounted rates above those allowances that kind of thing so that's that's that's a typical pattern that we would um we would C for and we need to as a meter as a business we need to um integrate with whatever their source of Truth for product usage data is and if it exists already we'll take from there if it doesn't then meter itself can act as that source of Truth um and we also need to integrate with the source of Truth for account data and for pricing data so again we integrate where wherever that currently sets and what we're doing is pulling the product usage the pricing and the account data together and processing it and what you're splitting out is Bill amounts and then we deliver those wherever they're needed across the stack so they're needed once a month for billing but they're also needed at any given moment so that customer success staff or sales staff know how much customers are using um the product team might want to build dashboards so that the End customer can see how much they're using and how it converts to spend at any given moment the um the fpna team might want to export it to the bi stack so that they can analyze the business effectively so that that's the key thing it's not just for billing it's actually it's actually to power a whole bunch of functions all around the business that makes a lot of sense so I guess today and we'll go back to your founding story here in a second I just want to snap shot today first and then we'll go get the story but today how many companies like SI SS actively use meter to do their their you know usage based billing um forgive me we don't disclose those numbers but um you know we're a a solid seriesa business um we've got great customers like sift or onfido or click house um who uh love our product has a transformative impact and they're happy to tell their friends about it can you give give a I understand you have to say slightly vague but can you put us at least in the right sort of world are we talking like five Enterprise customers or like 5 million low arpu high volume customers so okay so that provides okay for context our focus is definitely on scale up and above so what we're looking for is or our customers are looking for is um solutions to quite a high degree of complexity so our customers are typically of the size of those examples I gave the sifts and the alos meas you have an attached a number is it number of employees is it Revenue they're doing is a number of customers they're managing like what's the numerical value of the customer you're targeting so I would use the simplistically I would say revenues so it's $50 million AR and above okay got it got but what the better way to think about it is it's really about maturity so um a company in their early stages only has a few customers and they maybe only have one product and they might only operate in one GE but when they get more complicated they have lot lot of customers and multiple products and operate in multiple Goos and they will probably have an Enterprise sales team that has quite a high appetite to do custom pricing deals to win and retain key accounts it's when our customers get to that point that whatever solution that they had in place before to do what met does becomes overwhelmed you know that they would have had a um a manual based spreadsheet system or they would have built something themselves and it's when it's when they get overwhelmed that we come in so so we are at that you know our typical customer is $50 million an hour and above and the stage of our business is that we had tens of customers like that and growing fast that's thanks for that range it puts us at least in the right ballparks fair to say you guys sort of between 10 and 100 customers and you're focused on ones that are doing ideally north of 50 million of Revenue because it requires more complexity absolutely very well put let's go back to the back story here you were CEO of gamesparks uh did you guys build your own custom billing engine for like you know credits to get virtual swords in the games I mean how did you experience this problem directly yourself we we um we actually gave people the ability to do that so what so what gamees box was was I but I would call it Cloud infrastructure but given where you've come at the at this from it think about it as a back end as a box so video games were changing quite rapidly so um previously except for you know some relative niches most games were something that you could put on a shiny disc or its digital equivalent and sell and that was it like you know somebody people kept score by the number of units they sold and then video games went through um a transition where typically video games um would have a whole bunch of online features and they would be living products and the way people kept score changed from the number of units you sold to the number of active players that you have um and there was a lot of um a lot of this was the growth of mobile as a platform anyway so there was a big appetite coming from the video games industry to build backand platforms so they could do things like leader boards for um achievement systems and uh typically video games companies didn't have those skills in house because it was new and so that's what gam Sparks was it was a highly flexible highly configurable um back end as a service you you boot bootstrapped that and just sold it to AWS yes we did um so so our background is we had a background in an adjacent sector so um we did a lot of work in online TV and a lot of the intellect Capital that you developed there about how the Technologies work was actually applicable um to video games I mean if I did it all over again I wouldn't I wouldn't have built a service for an industry that I didn't know intimately myself and hopefully we're um we're avoiding that problem with with meta but you know we we made it work and I really enjoyed it and I love the video games industry um yeah it was it was a success that's great well Griff we got about four minutes left I got a lot more we want to try and learn from talk to me about other people pricing what about your own pricing so you guys charge quote based off a platform based on the number of measurements you send and the number of API calls you make subject to minimum commitments and allowances for storage and data eress so that might say like you can do a million API calls per year for 10 grand and if you go above that it's X we're very like um you know our customers is that we have to be usage based I mean we kind of have to be um our own um dog food um but that's what our customers want but because we try we we sell into those more mature businesses they they want predictability like I mentioned before so our you know our deals typically are under underneath the hood they're usage based but um the way they work is that our customers make a minimum commitment to us um and that involves generous allowances of those usage um vectors and if they exceed them they pay overages but so it it it it's quasi it's quasi fixed recurring but with a usage based C and and you see that a lot I just I'm not a tech guy so I don't know you know how many API calls a $50 million AR company would be doing but give me I me teach us a little bit here would that be like a million API calls per year or 100 oh it it's it's so variable it just depends and you know and it's there's a lot of it can be the the amount of usage data that they're ingesting so it can be very high volume and high velocity what would be a high API number for you a million a year 10 million a year 100 million a year oh no billions a year billi billions you have customers that are doing a billions of API costs through you per year but but there's there's different vectors so it's not just the amount that you're ingesting in it's also the how frequently you're calculating the bill because if you calculate the bill just once a month for billing purposes you you won't do many Bill calculations but if you're calculate them every 15 minutes so that there's an up toate how your bill is tracking available on just I'm trying to get a sense of skill here you do have customers that are doing billions of API calls per year on the platform yeah wow that's incred I mean that's that's incredible because they're doing Real Time pricing every single usage thing every single second thing things go up or down but I don't see that as a big number because of our games spot experience so you know audience doesn't have your experience that's why I'm trying to get I I'll use games Fox as an example so we were doing about 40 billion API calls a month um and you know we were probably yeah we were smaller at an earlier stage than our ideal customer so it just depends I mean if if you're doing things in um Cloud infrastructure they can be very high volumes in different versical there can be lower volumes so what's the minimum you require like if someone's doing only a th000 APS per month they're not a good fit for you what is sort of the minimum that you would require someone to get value from your platform is that you know 50 million API calls per month you just said gam spot at 40 per 40 million per month is too small it's not but I wouldn't say that the I wouldn't I wouldn't think that way because uh it's depend they could be trying to cope with a high degree of priceing complexity that might not have a huge amount to do with the the volume of usage in just so you know it might be whatever like a million 10 million 100 million doesn't matter but what the reason that they might be having real headaches is they've got a lot of customers and they've got a lot of SKS and they've got a lot of complex bundling and they need to do a lot of complex billing logic and they want to change prices um they want to do a lot of custom pricing the sales team want to do a lot of custom pricing so that's what creates the complexity for that business is like there's lots of vector we like complexity that's what we serve yeah Griff trying I'm trying to quantify so you mentioned earlier you have a minimum number of API costs per year that you require folks to get is that like a million API costs per year or 10 million or 100 million or a billion uh I didn't say that because we don't but um you don't charge it you just sorry just back at minute 857 we transcript real time uh you said quote you have a minimum number of credits that they've got to purchase and then they go up or down from that so they would pay us a minimum amount which would give them an allowance of X but it we don't require that they use a certain minimum level of that allows they can use it if they like funded if they don't use the full amount in the year no because what we're delivering because what what we're delivering them is um a really sophisticated piece of kit that they would otherwise have to build themselves and so like I that's why it is usage based because but the better way to think about it is you pay we wouldn't position it like this but think about it as a platform fee you pay you're paying a platform fee but then you can Flex how much you pay above it depending on how heavily you're hammering that platform how much you're you're using it that makes good sense as we wrap up here um you launched the B did you launch the business right after the sale at AWS or when did you launch the company we uh worked for three years at AWS they have all the problems that we solve for just like games Spar said all the problems we solve for and then we we left AWS in 2020 have been going for about three three and a bit years okay so launch launch meter in 2020 and you guys I believe have raised how much total have you guys raised 31 and a half million from external sources okay and and you bootstrapped gam spark so you know the difference between doing each right um what why did you why did you make the decision that meter was the thing you had to go raise a bunch of AC for um partly because we just wanted to do something different and S of follow a different path for interest sake but also I mean we we're building critical infrastructure for significant companies and um that requires quite a lot in comparison quite a lot of capital to you know you the minimum MVP to do this kind of stuff which you know it touches dollars you know it it drives billing um is quite high so it seemed like the natural path for us um but it was also you know the novelty value it was fun to do something um do something different I mean but this is very if this is very dilutive though right I mean series a you're selling 10 to 15% the average series a you know seed you're selling 15 to 20% even so you're you know you guys are now Ed down to whatever you're diluted down to right so but you've made the idea you've decided that you needed and it was worth that dilution to go build something big that's the game I mean you you're trying to build something very big and then you know the delution still makes sense so yes talking about the team really quick how many are full-time and how many are Engineers again backing up your statement that this requires a lot of engineering um we're between 50 and 60 at the moment um and the engine so we're still mostly Engineers the reason I'm slightly pausing is some of our Engineers are actually focused on implementation because these are these are quite big Transformations that our customers are going through and and we provide a lot of value by helping them them through it but yeah we're we're comely majority engineer company so so okay so if I say how many Engineers on the team you would you'd say 50 I don't have the number uh on the tip of my tongue but it it's uh the majority of the of the company is engineering that's what we do okay I mean the reason I ask is you can't just have a great product if if no one knows about it no one's going to buy it right so you're saying there's no sales team there's no a no sdrs no no no we I mean yes we we have um go g Mar capability for sure but um but we with an nature of the nature of our company is that you have to be quite heavy in terms of your product because you're building a lot of it no I understand that I'm quantify it right that would make sense if you said hey we have 40 engineers and 10 sales reps right or go to market folks but when you say majority Engineers I don't I just don't know what you mean by that more 25 Engineers would be the technical definition I guess I'm dissembling because I don't know the exact number that's okay that's okay that's okay um who's doing are you coding or are you doing selling in terms of how you and John split roles uh John is uh doing everything no John is the C so he manages the goto Market teams which includes the pre-sales engineers um he's the way we work together is that I'm a a strategist and a company Builder so I'm I'm about creating the infrastructure of the company and he on the founding team then pardon me there is no one that writes code on the founding team you you nor John write code so if the founding team is John and me that's correct although John is a data scientist um but this is a founding group that came from our previous company involving strong engineering that came with us through games SPX and AWS so you have other Founders well it depends exactly I consider them to be part of the founding team I don't know exactly what language you want to use um but yes so you guys put out when you raise capital and it says Founders Griffin Perry John Griffin I'm just using publicly traded sources so to okay to answer your question there are two there there are two Founders both called Griffin neither of us um code or you wouldn't want us to be but we built a te we we built a team of people we'd worked closely with in the past um and very high quality engineering was involved from inception with the company yeah that makes sense I guess as we wrap up and you think about um your pricing model over time if someone's like let's say I want to sign up right now to meter and I'm more than 50 million of AR and I'm going to pay for I'm going to make this up 100 million API calls per year are you saying okay Nathan the platform fee is 100 Grand and then it's 0.001 cents per API call or like how would that be structured again forgive me if I don't disclose that because that's sort of commercially sensitive information but you know we again to give you a sort of some Direction like we have quite we have a sales lead motion um and that means that um we need to earn a significant amount from our customers for the unit economics of our business to work and they do so yes the the amounts our customers pay us um are reasonably high and that is nicely consistent with the amount of value we deliver to them because this transform it for them how do we I'm end with a macroeconomic question um with 56 full-time employees and assuming that you follow the average of the average revenue per employee per for a VCB company being about $110,000 that we could back and do maybe a revenue guess of about6 million bucks with what you've raised 35 million bucks assuming that was raised at a you know multiple in the 2020s or 2021s right it's fair to say maybe you rais at north of 100 million valuations today things have really compressed you know how do you make sure that you take whatever Revenue today and you grow into evaluation that can support the last you raised at without getting options underwater so um I'm not going to comment on valuations or Revenue but I can say that we've got we've been very fortunate and that we've got a lot of Runway and that provides us with a lot of flexibility um I mean in terms of the potentially dilutive impact like I still think that we were incredibly for fortunate to found the company when we did because those fund favorable fundraising conditions allowed us to raise a lot of funding and that was needed because we're building critical infrastructure like I said and now I'm focused on the longterm like we're trying to build a really big company I don't worry too much that the conditions are changed it's just is what it is and you just continue to make um progress so let's let's see what the market conditions are like if and when we raise again and they'll be different from they are today and certainly different from from last year okay so just to be clear you're not feeling any sense or need to manage around a valuation issue where you raised it a 40x multiple two years ago or a year ago when you raised your your series a versus sort of where the Market's trading at today you don't feel that's not you don't feel that pressure at all I can imagine scenarios where it's easier and I can imagine scenarios where it's more difficult but I'm not leaving losing sleep over it like what I'm focusing on is building the business um effectively it um I want to build a great business in 2024 where are you to to your point on a lot of Runway which is great where are you spending I mean as a capital allocator as the founder you do a lot of this where are you investing Capital this year to try and create something better long term so I mean like our Focus generally is we're in that tinkering phase um what I mean that tinkering phase you you've raised 35 million like you have to have real Revenue you're not in a tinkering phase well it depends what you see yourself as tinkering like what we're doing you're building a machine like you build a product now you need to build the company and you need to be able to scale it effectively so what I mean tinkering it's like how do we grow faster how do we improve our unit economics how do we improve all our metrics it's that tinkering it's like you know you you we're the stage where really you want to be a business architect and a technician you're sort of fiddling with all the knobs to make the the machine run um smoothly um sorry I forgot your question just REM we're out of time so we'll wrap up with the famous five is there rapid fire one word answers number one is there a CEO you're following or studying no number two is there a book that's really had an impact on you many but I'll call out one escaping the build build trap by Melissa Perry escaping the build trap great number three is there favorite tool that you use to build meter I feel like I have to say AWS fair fair fair uh number four uh how many hours of sleep do eat every night seven to eight more than I used to pretty good and situation married single kiddos I'm married with three children the oldest of which turned 18 yesterday great you're a busy guy then four startups how old are you as we wrap up here GFF how old am I yep 51 51 years young last question something you wishing knew back when you were 20 well this I mean this feels quite close to home given my eldest yeah became an adult yesterday um I would say go easy on yourself like if you don't know what you wanted to do or who you want to be at 20 that's completely normal just take your time um but the one thing so that's the good news the bad news is if you want to achieve stuff grit and resilience matters an awful lot unfortunately you have to accept that guys grip s's last company to AWS and through that process said I've got a great idea which he launched in 2020 it's called meter and it helps companies that are generally doing more than $50 million or Revenue a more accurately capture and and Bill based off usage you've got to capture the product usage data then bill against it resulting in billions of API calls per year in some cases today meter is working with between call 10 and 100 customers they have about 56 on the team with quote a majority being engineers and quote plenty of Runway as Griff and his team looks to invest in the long term Griff thanks for taking us to the my pleasure love you to me