Miitel Revenue, Valuation & Funding (2024)

[00:00] Guys, MiiTel. Think of it like Gong, but for Asia Pacific plus extra things added on top of Gong. He's got over 1,600 paying customers doing over 1,600,000 a month in revenue up from 800,000 a month just a year ago. Done this very capital efficient. They raised $15,000,000 in a series a. I called a 150,000,000 valuation back in 2020 and hasn't raised since. So very efficient growth, 200 on the team, 80 engineers, 30 sales reps, 120, [00:25] 110 plus net dollar retention as he TK looks to scale. Hey, folks. My guest today is TK. After joining Mitsubishi Corporation, he was involved in automotive trading, planning, and executing sales and marketing initiatives in overseas markets, cross border investment deals, and new company formations among many other things. He founded RevComm in July 2017, which provides a self coaching tool called miitel and miitel for Zoom, a service that uses artificial intelligence to visualize sales calls, call center [00:53] operations, and meetings. Company has expanded more than 40,000 users in four years among Japan, Indonesia, The Philippines, and The US. TK, you ready to take us to the top? [01:02] >> Yep. Alright. How's it going? [01:04] Good to meet you, man. So just to be clear, is is RevComm a parent company with a bunch of companies, or is the main thing miitel? [01:11] >> Main thing miitel. It's the you know, company name is RevComm. It's a RevComm Inc, and our service is miitel and miitel for Zoom. [01:20] Okay. So the website, if you wanna follow along, will be revcomm.co.jp. Right? Yeah. Alright. Very good. [01:27] >> We have lp, like, you know, miitel.com. [01:30] That's great. Alright. So let let's talk about miitel.com. Right? So what does the product do and what kinds of customers are you selling to? [01:37] >> Yeah. It's, you know, b to b SaaS self coaching tool, very simple service. It analyzes and visualizes the sales and shares competition by artificial intelligence in terms of what and how. So in terms of how, we, you know, visualize talk-listen ratio, number of silences, overlaps. Overlaps means interruption, by the way. And number of silences, rallies. Rallies means a conversation back and forth, and speech rate. How many characters per second operator spoke, and customer did. So, [02:09] >> for example, in terms of, speech rate, it is said that pacing is important in sales or shares. Pacing means you are supposed to talk plus minus 10% of the customer because there's a strong correlation between brain speed and speech rate. So if you speak too fast, the customer can't understand. And if you speak too slowly, customer is [02:29] Right? [02:30] >> Not [02:33] >> Yeah. So that's why you're supposed to talk plus minus 10% of the customer. In this way, you can see how the communication was made and where the issues are. And in terms of what, we transcribe the whole conversation and summarize it and all the market and put it into CRM as a way. So that's what we do. [02:50] TK, can you do sentiment in that sentiment analysis? You know, happy, sad, things like this? [02:55] >> Yeah. We, you know, analyze emotion as well. [02:58] Interesting. [03:00] Okay. Very cool. I mean, have you been what this reminds me of mean, it it feels like you're effectively Gong, but for Asia, I mean, is that a fair comparison or no? [03:09] >> Yeah. It's a fair comparison. Okay. So the difference between Gong, Chorus, and miitel is that very simple. You know, the miitel equal Gong plus, you know, Zoom Phone or Dialpad and RingCentral, which is IP phone. So miitel consists of two parts. Right? IP phone, cloud IP phone, plus conversation analytics. Since it's a one stop service, and we provide it with only $79. And it won't cost you, you know, you know, 100 to $140. [03:43] So Yeah. So so it's 70 I see. You're very clear on your website. It's 69 or $70 per month. Is that per user per seat? [03:49] >> Yeah. Per user per seat. Yeah. Okay. Per user per month. Yeah. [03:54] Oh, what's going on there, YouTube? Good to see you guys. Now imagine this. You love watching these interviews with SaaS founders, but imagine if we took all of the valuation data out from over 2,807 interviews I've done manually. Saves you a lot of time. Well, we've done this. We've built it into the beautiful interface inside of Founderpath. Check this out. I'll show you how you can access this in a second. But you log in, you connect [04:17] your Stripe account, you see your valuation real time. You can see what it changed over the past eighty eight days and even set goals for valuation this year. Now the secret evaluation is there's many different ways to value a SaaS business. So the reason you're gonna see three or four different valuations inside of your Founderpath dashboard, this is all free by the way, is because depending on who's doing the buying of your SaaS company, you're gonna [04:41] get a different valuation. A VC is gonna pay a different valuation, Private equity firm is different. If you're gonna do a minority sale, that's different. And if you sell the whole business, that's a different valuation. You can see all those when I hover over here. Right? So the teal is what a VC would pay. Yellow is what private equity And red is if you sold the whole thing outright. Now what's cool about this is this is [05:03] not built off random data. Again, you guys hear these interviews on YouTube. All these datas are built from real time valuation data points founder share with us on the show. So traction 1,200,000 seed round 3.7 raise. They sold 22% of their business. Go in here and filter by the event. Maybe you only wanna see companies that have sold the whole business. Well, here are a bunch that have been acquired the valuation and the multiple. Maybe you're [05:29] going out right now and you're raising your seed round. We'll go in here and look at all this recent seed deals that went down, what they raised, what valuation they raised at and what percent that they sold. There's never been a larger dataset of SaaS valuations than what you can get now inside of Founderpath. And we're thrilled to bring it to you. All right. We're gonna go back to the YouTube video here in a second. But [05:51] if you wanna check this tool out, if you wanna jump in and sign up, you can check it out for free to get your valuation at this link, this link, founderpath.com/products/valuations. Or if you go to founderpath.com and hover over products, click on get your valuation here, and go ahead and sign up to give it a whirl. Again, all that valuation data live right inside the platform. I hope to see you there. Alright. Let's jump back into [06:17] the interview. What does the average sort of company pay per month? This will be driven by, obviously, the number of seats they're paying for their team size. [06:25] >> It totally depends. But in Japan, enterprise customer pays us, usually, like, you know, $140 per month per, ID, including, you know, call charge and mobile, app, you know, options and also storage options. You know? So 69 bucks, it includes two months of recording, you know, storage, But enterprise users usually, store, there's you know, record data recorded data more than, you know, twelve months. Yep. So they have to pay the storage fee. [07:09] Yep. That makes no. That makes a lot of sense to smart upsell. But if you look at your not just your enterprise cohort. If just look at all of your paying businesses today, is it fair to say the average business is paying something like 500 to a thousand bucks a month? [07:24] >> Yeah. That'd be, like, four or five seats, basically. [07:27] Yeah. Yeah. Okay. Interesting. [07:29] >> It's, you know, industry diagnostic from financial industry to manufacture, from listed company to SMB. Yep. Yep. It's a horizontal SaaS. [07:41] This is great. Okay. I understand what you charge. I understand the product. Put this on a timeline for us. When did you launch the business? [07:47] >> We launched miitel in two thousand eighteen, November. So it's been about four years and three months or so. [07:57] And are you the only founder? [07:59] >> Yeah. I'm the solo founder. [08:01] That's that's the way to do it, man. Right? Now are you already super rich? You put up your own money or what? [08:06] >> Well, not really. I mean, what what I'd like to do in the future is like, you know, I'd like to spend my time and network, social network to the philanthropic, you know, activity. So most of the share is owned by, you know, my foundation. It's called the ThinkAct Foundation and Takeshi Aida Foundation. Mhmm. So 90% of my share is owned by found that foundation. [08:36] Do also do that because of a tax from a tax strategy perspective, that's smart tax planning? [08:42] >> Yes and no. I'm willing to pay a tax to the Japanese, you know, government for the, you know, society for the society. Right? [08:52] What is the average tax rate in Japan? If you sell the business for a billion dollars and you own all the equity, how much you're gonna pay the Japanese government Yeah. [08:59] >> Capital gain, tax is 20%. So it's not that much [09:04] lower lower than that's lower than some spots in The US. [09:07] >> So Right. So, you know, the tax strategy is not that important for the capital. [09:13] Yeah. So you keep going here in 2018. Now did you write the original code, or did you convince an engineer to write it for you? [09:20] >> I I convinced engineer write for me. Yeah. So [09:22] You're very convincing then. [09:24] How did you do that? [09:26] >> There's no, you know, secret sauce. It's keep communicating with a lot of engineers. But my findings at early stage was that there are four types of engineers, right? The engineer for all strength strong at, you know, structure, architecture, and algorithm and application, and management, right? And so what early stage founder should find is the architecture engineer through a strong architecture engineer. Because if the architecture is not well architected, then you have to rebuild in at some [10:11] >> point. Usually business person seeking the application engineer because application engineer is very, very, you know, well known. Yep. So the engineer who made this service, right? [10:28] Did you just pay him or her a lot of money or did you give him equity? [10:32] >> Equity plus, you know, money. [10:35] What what does an mean, don't tell me the salary of your first hire, but in general, an architecture engineer in Japan today, I mean, what are you gonna pay them per year in salary? [10:43] >> Well, it totally depends. So at first, I paid them only, you know, $5,000 a month [10:48] Yeah. [10:50] >> Plus salary plus stock option. Right? [10:55] Yeah. But we're talking, like, under 5% equity. Right? [10:58] >> Yeah. Under 5% equity. [11:00] I mean, that's still impressive that you're able to recruit someone that you feel like is pretty talented for $5,000 a month plus under a 5% option grant. I mean, he must or she must have just really believed in your vision. [11:11] >> Yeah. That that's that's the point. Right? [11:14] Why? What what why why did he believe you? I mean, is this your second or third company? How did you build his or her confidence? [11:20] >> Enthusiasm, man. It's all about enthusiasm, dream, vision, and also engineer really care about, you know, logical strategy, right? So how are you gonna make the business bigger and watch your tactics and watch your strategy? You have to be very logical. So it's a balance of enthusiasm and logic. It's all about that. [11:47] That's the origin story. You get going in 2018, we put out a report every year of the fastest growing SaaS companies. We found you, you give us results. I don't wanna steal your thunder here, so I'll let you share. Right? What what's revenue today, and how fast did you grow the last twelve months? [12:03] >> It's it's we are not disclosing the revenue. But [12:08] Wait. TK, I you gave it you gave it to us already publicly. [12:13] >> It's a, you know, beyond t two d three cop, which is, you know, triple triple double double double. [12:20] And Oh, yeah. But that's that's yeah. That's, like, that's a non you know that's a non answer. Let me let me ask you let me ask you this question. Instead of a revenue figure, you know, you get your do you get your first customers in 2018, did it take you a couple years to get the first customer? [12:34] >> At 2018, we had you know, at the first of, you know, launching, we already have 30 companies. [12:44] How'd you do that? [12:46] >> You know, I went to a Salesforce event and keep talking, hey, we are self coaching tool, and if you're interested, why don't you use closed beta version? And then when we officially launch, you can, you know, turn it to paid customer. So that's what I did. [13:03] What was your initial price point? Was it always $69 a month? [13:07] >> No. At first, it was 49 because the, you know, function was very limited. We didn't have any emotion detection engine. Also, we didn't have a transcription engine. We only have how to speak engine, like, you know, talk-listen ratio, number of silences, overlaps, and speech rate. That's it. But, you know, customers'willingness to pay with how to speak engine was, you know, $59. So, you know, I [13:36] I 30 customers because you're hustling at a Salesforce Salesforce conference. You get 30 signed up. Now fast forward today, three years later. How many customers are you working with? [13:46] >> We have company number of company is 1,600. [13:53] 1,600. [13:54] >> Yeah. [13:54] Okay. And you mentioned earlier the average one pays about a thousand bucks a month. Right? I mean, so we can sort of I mean, you're doing somewhere around a million and a half a month in revenue. [14:04] >> You can guess. [14:06] I'm not guessing. I'm multiplying your numbers. You told me earlier your average ARPU was 1,000 a month, and you just told me your customers were 1,600. Is there any reason I couldn't just multiply those? [14:16] >> Yeah. Well, I mean [14:20] >> yeah. I mean, average ARPA, average revenue per account is more than thousand bucks. So So [14:28] you're doing more than 1,600,000 a month right now on revenue? [14:33] >> Yeah. [14:35] Okay. That's good enough. You're at, you know, above that range today. Where were you exactly a year ago so we can calculate a growth rate? [14:39] >> It's half of it. [14:41] Okay. So you've grown a 100% over the past twelve months. That's great. Now did you do this bootstrapped or have you raised a bunch of capital? [14:48] >> We raised approximately $15 three years ago, and since then, we have not raised any money. [14:55] Alright. You raised capital efficient. [14:58] You raised how much? [15:00] >> $1.05 15,000,000 USD. [15:03] Oh, million. Okay. I thought you said you raised $15. No. Got it. Got it. So you raised that money in '20 in what? 2020, you said? [15:13] >> No. '20 yeah. 2020. It was '20 Yeah. Three years. [15:18] 2020. And why I mean, why did you need to raise that money? What what about this business is capital intensive? [15:25] >> Well, to accelerate our hiring and also sales market marketing expense, I'd like to, you know, raise approximately 10,000,000. But, you know, for the 10,000,000 call, $50,000,005.00 has, you know, knock knock us. So I have to arrange, you know, who who to welcome and then end up with $15,000,000. [15:53] Yeah. Yeah. That's fair. Now would you consider that sort of your series a? [15:57] >> Yeah. Series a. [15:58] Yeah. Yeah. I mean, most people know series a, they're selling between 10-15% of the business. Were you sort of in that same range? [16:05] >> Yeah. Yes. [16:06] Okay. So it's like a 150,000,000 valuation, something like that. Yeah. Yeah. Okay. Very good. And do you remember what revenue was back in 2020? [16:15] >> It was, like, approximately [16:19] >> 200 k MRR. [16:22] Okay. Okay. Yeah. So did that valuation back then feel fair to you? Would you do anything differently? [16:27] >> Yeah. It was fair. [16:28] For sure. I mean, what is that? What is that? A 150 divided by 2.4. That was a 62 x multiple. I mean, back then [16:35] >> Pretty much. [16:37] Back then, that was the market. Today, that would be very aggressive. Yeah. [16:41] >> Yeah. Market has been changed totally. [16:43] Do you are you in a position right now to sort of outlast the recession, or are you burning a bunch? You need to go raise money this year. [16:50] >> We don't have to raise money. We are still capital efficient. [16:55] So That's awesome. That's awesome. So what's what's the target this year? I mean, do you think you can break a 30,000,000 run rate, 35,000,000 run rate this year? [17:05] >> Less than that run rate. [17:07] >> I mean, burn rate. Right? [17:10] No. No. No. What do you think you can hit this year in terms of revenue? [17:14] >> Well, we'd like to double it for sure. [17:16] Okay. So that I mean, do you think you can get over $40,000,000 in revenue run rate this year? [17:21] >> Pretty much. [17:21] That would be aggressive, but [17:23] >> Yeah. [17:24] A little uncomfortable but doable? [17:26] >> Yeah. I think, it's doable, [17:30] >> in in terms of we are expanding, you know, our, you [17:33] >> know, market, not only in Japan, but also Indonesia, Philippines, and The US. [17:38] Henry Schuck went out and acquired Chorus recently. Well, call it a year and half, two years ago for about $450,000,000. I imagine he's aggressively looking at Asia. I imagine you've had to have conversations with folks in terms of m and a. Are you in any conversations right now to sell the business? [17:55] >> Not really, but we are open every time. I actually talked with ex founder of, you know, Chorus. [18:05] Roy or who? [18:06] >> Yeah. Roy. Yeah. [18:07] >> Yeah. You know Roy? [18:08] Of course. Yeah. [18:09] >> He's Nathan Latka. [18:11] Knows everybody. Come on. [18:13] >> Yeah. [18:14] I mean, look. You're an interesting target. You're an interesting target for ZoomInfo. You're an interesting target for Amit at Gong. Like, anyone that wants to expand to Asia Pacific, I would say you are, like, a prime target. You're very well positioned because you're so capital efficient. Yeah. You your ARR is more than, correct me if this is wrong, you have more ARR today revenue than the total amount of money you've raised. [18:34] >> Yeah. For sure. [18:35] Of course. So you're very capital efficient, which makes you a prime target. Uh-huh. Yeah. No. I love that. That's great. How many folks are full time on the team today? [18:43] >> 200 people, approximately. [18:45] How many engineers? [18:48] >> 40%. [18:49] Okay. Got it. So call call that 8,200. Yeah. 80 engineers. Yeah. How many sales reps with the quota? [18:56] >> 30. [18:57] 30. And how aggressive are quotas over there? And, I mean, is it is it is it a million a year is what you want them to do? Per per Per rep? [19:06] >> Per rep. Yeah. [19:08] Is is that it? That's what you have your set at, a million dollar quota for your top reps? [19:12] >> Yeah. [19:13] Wow. Okay. Do all of them hit it? [19:16] >> No. Only 20%. [19:19] Oh, okay. We're okay with that. [19:21] >> They're using, you know, self coaching tool miitel. So [19:26] That's fair. [19:28] That's fair. That's fair. Okay. Very good. And then, I guess, look, net dollar retention is obviously a critical component of a SaaS business. Are you guys above a 100% today? And if so, how far? [19:37] >> Yeah. For sure. Yeah. Yeah. Our key metrics is, NRR. So How like to maximize One one forty. 40%. [19:47] It's Are you above one hundred? [19:48] >> Hundred to a 150. [19:48] Yeah. [19:49] Okay. Well, I mean, that's a big world class is, I would say, 150, one forty or above. You've I know. So [19:56] >> It's it's less than one one forty. [19:59] Yeah. Okay. Fair enough. But you're between a 100, you know, call it one ten and one forty, somewhere in there. [20:03] >> Yeah. [20:03] Yeah. [20:04] >> Somewhere around that. [20:04] Very cool. Well, listen. This is a great story. I appreciate you making time. We're out of time though for today. Let's wrap up with the famous five. Number one, favorite book. [20:15] >> I I I love, you know, philosophy. I I like the Kant, Critique of Pure Reason. That's my favorite book. Yeah. [20:23] That's the one, the Kant. [20:25] Number two, is there a CEO you're following or studying? [20:30] >> I would say my dad, but what I respect most is Bill Gates. [20:36] Bill Gates. [20:37] Number three, what's your favorite online tool besides your own for building miitel? [20:44] >> I would say Slack. Without slack, I cannot do work. Yeah. For sure. [20:49] Yeah. [20:50] Number four. How many hours of sleep do you get every night? [20:52] >> Usually six hours. [20:54] Okay. And what's your situation? Married, single, kids? [20:57] >> Married with one, you know, daughter. [20:59] Oh, that's great. One kid. That's awesome. How old are you? [21:04] >> I'm 33. [21:05] 33. [21:06] Last question. Something you wish you knew when you were 20. [21:10] >> When when I was 20? [21:12] You were 20 years old. [21:15] >> I don't know. [21:18] >> Start my business earlier. I I started my business when I was 28. I should start, you know, much earlier. [21:26] Guys, MiiTel. Think of it like Gong, but for Asia Pacific plus extra things added on top of Gong. He's got over 1,600 paying customers doing over 1,600,000 a month in revenue up from 800,000 a month just a year ago. Done this very capital efficient. They raised $15,000,000 in a series a at called a 150,000,000 valuation back in 2020 and hasn't raised since. So very efficient growth, 200 on the team, 80 engineers, 30 sales reps, a [21:50] 120, 110 plus net dollar retention as he TK looks to scale. Very exciting space. TK, thanks for taking us to the top. [21:57] >> Thank you very much. It's a pleasure to talk to you. [22:01] One 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 [22:26] Central. Additionally, remember these recorded founder interviews go live. We release them here on YouTube every day at 2PM Central. To make sure you don't miss any of that, make sure you click the subscribe button below here on YouTube, the big red button and then click the little bell notification to make sure you get notifications when we do go live. I wouldn't want you to miss breaking news in the SaaS world, whether it's an acquisition, a big [22:48] fundraise, a big sale, a big profitability statement or something else. I don't want you to miss it. Additionally, if you wanna take this conversation deeper and further, we have by far the largest private Slack community for B2B SaaS founders. You want to get in there. We've probably talked about your tool if you're running a company or your firm if you're investing. You can go in there and quickly search and see what people are saying. Sign up [23:10] for that at nathanlatka.com/slack. In the meantime, I'm hanging out with you here on YouTube. I'll be in the comments for the next thirty minutes. Feel free to let me know what you thought about this episode and if you enjoyed it, click the thumbs up. We get a lot of haters that are mad at how aggressive I am on these shows, but I do it so that we can all learn. We have to counter those people. We [23:30] got to push them away. Click the thumbs up below to counter them and know that I appreciate your guys'support. Alright, I'll be in the comments. See you.