Mindee Revenue & Funding (2024)

hey folks my guest today is jonathan gran pion he's the co-founder and ceo at mindy an entrepreneur with a keen eye for technology disruption and addressing real world enterprise challenges his executive tech experience on his shoulders having held the cto title for thank you and actor prior to joining mindy jonathan are you ready to get to the top yeah all right so just to be clear you said joining mindy are you a co-founder you came in later co-founder okay and what year was that when did you guys get going sorry when what year was that when did you guys get going oh we started working at 90 like in early in 2018 with uh two of my co-founders and everything really started in 2019 yeah what do you mean by restarted um actually at the beginning for the first year we have been kind of trying to discover how the market works and what were the needs in terms of document processing in companies and when we figured that there was a specific need on this area we started working on the products in 2019. i see okay so tell us yeah tell us what the product does and and who you're selling to who are the customers yeah um so basically we help software companies build document processing automation features in their software so our users are mainly software developers in general and also product people like product managers or cpo vp products and and we give them the technological layers so that they can build very easily document processing features for their users got it and what are they paying on average per month to use your technology uh that's very depending because we have large enterprise as well as very young companies but it's between a few hundred euros to to 10 12 k monthly okay but what that's a huge range what would you say sort of your sweet spot is like 500 bucks a month or more like five thousand a month well between one two three uh i don't have one so the reason i'm asking that now i can be specific if someone's paying you three thousand uh you know us dollars per month what are they getting for that is it based off number of api calls or something else yeah based on the api calls as uh almost all the api companies but uh yeah one page is 10 cents on the first pricing grid and then the more you consume the more you use the api the less the marginal price will get um so what do you mean by one page is 10 cents is that if i upload a document that's 10 pages long and i need that signed yeah one page of a document like if you have a pdf of 10 pages it's going to be 10 pages price so 10 times 10 cents one dollar i see i see but you obviously care more about moving everyone to the api model that probably is more effective yeah but the value the unit of value of our product is the page actually so but it's kind of really related to the number of api calls in the end because on average the document is like one to two pages more maximum so i just think about driving usage it's it's a tricky thing to tie your upsell metric based off the thing you need found like people to do to get value which is the page because for example if docusign charge per page every time i did it i'd feel a little bit negative because i'm going do i really need to spend 10 cents to get this signed right now and slowly i'd look for alternatives and eventually i would probably churn how do you guys balance that uh for now we we are not shown at all so i don't think this is a problem for us today um in general like well what do you mean no turn at all how do you man how do you measure that we have no we have no logo churn and uh very strong negative junction rate so people are more uh using more and more the api over time than uh just dropping because of that i don't think the pricing is uh is a problem for us in the adoption actually uh just because of this digressive pricing grid you know if you uh if you make 10k calls monthly is going to cost you 800 [Music] if you have a volume of 25k it's going to be less than that like six cents per uh document so we want to help our client grow and uh build the best user experience yeah i mean you're talking about you're talking about retention right i mean you have churn and then there's expansion and there's net dollar retention and usually api businesses like this you look at snowflake you look at twilio they said that cengage they have really high net dollar retention of way above 100 where are you guys at uh it's between 200 and 250 percent after one year so it's uh that's great that's uh something very good for our business so yeah so the average a year a year one customer doubles their what they pay you in year two but when you look at it okay but when you look at your full base so you look at the last 12 months across your whole base gross churn plus expansion net dollar retention is what yeah we don't have churn at all in terms of usage so jonathan just be clear when you say you have no the reason i push you on this i find it very unless you only have like one customer but i find it very hard to believe that there are zero customers that use you who last month signed 10 pages and this month no one went down lower than 10 pages in other words your churn will be measured by a little downgrade in usage month to month you're saying no one ever uses less this month than the last month okay it happens of course like during the server for example we have obviously a lower usage but people are hard to say that the the extension is so much higher than the uh the the slow of their usage the contractions and contraction and expansion yeah that's what i'm trying to measure right so contract like you you might have 10 contraction but expansion is so big expansion could be 90 so your net dollar retention is still 180 that's what i'm trying to understand yeah the net retention rate of 250 percent i was talking about is including the contraction also of the usage today maybe yeah because you're giving me that net dollar retention of 250 based off first year contracts which is easy someone could go from a dollar to four dollars and that's 400 percent expansion the better way and how publicly traded companies track net dollar retention is you look at your full base your full installed revenue base a year ago compared to today that's what i'm trying to get to not just your first year customers uh i i think it's the same like we compute our course monthly so quarterly sorry so all the customers we had like one year ago and we signed during the last year quarter yeah it's okay we can skip over it's not important i think you give us a good lesson which is you're pricing off a number of api calls usage is going up some people use it a little less but the expansion is so big it doesn't matter so you have really healthy unit economics that's the keyboard yeah all right let's get let's move on from that let's get more of your backstory here so you guys started writing the code in 2018. um how many co-founders are there uh three co-founders and one late funder three co-founders and one what late co-founder as well like he joined us in uh early in 2019. i see did you guys just split 25 each no how did you have that conversation every founder has to go through that it's a tricky situation it was actually very natural because uh i don't know i don't even remember when we had this uh this conversation it was kind of natural to to make the splits like we came with a plan very easily and there was no discussion at all on this so i'm not going to give you the the figures on how this is distributed in terms of capital between the founders but at the very very beginning we started with mohammed my chief of science and the split was done between the two of us and then olivier joined us the first month and he's the co-founder as well of course and uh yeah everything was supernatural between us but what i'm trying to dig at here is every co-founder team has to have this conversation right so somebody owns more is it because they brought more capital more experience more take me into that conversation a little bit okay uh no i think we just focus on you and muhammad just the two of you thinking differently like it was not my first uh experience as a co-founder of startup so maybe it was important in the discussion at this moment at this point in time and uh just because of the role as well maybe it's important as well like the the ceo owns a bit more than the other co-founders for example i see got it okay so you know maybe a little bit more than everyone else because of these things yeah okay so you guys get going in 2018 tell me about your first customer do you remember who it was and how you found them oh sure uh an hrs company hri sorry uh in france uh one of the leader they have approximately one million users i think or maybe more they're called luca lucca and they add an expense management solution and expense management mobile application and they wanted to to to improve the user experience when passing receipts and we are using a company called abi a buy i don't know the english pronunciation for that uh abdyy and and they were not okay with the performances in terms of response time and accuracy as well so we built our first prototype with this client and the benchmark the solution we were proposing to them against the ib solution and it was our first client like deployed in beta version maybe in march or may 2019 we have been yeah they are great and they are to customers and happy customers i think so zero revenue your first year in 2018 the first year revenue was 2019. now we have been doing revenue because we we were selling um like algorithm conception missions to make revenue i wanted to bootstrap the company and not to race too early and that's what you're doing consulting basically to get to get cash early yeah and we decided to stop completely reconstructing in q4 2018. how much consulting revenue are we able to do to help bootstrap i don't remember like a few hundred k maybe okay that's impressive yeah that's impressive okay so are you tell me more about funding now today are you bootstrapped from that or have you raised no we raised the 14 million series a and in q2q3 this year and we raised also a seed round in may 28 2019 sorry of about three million dollars and talk take me back to that three million dollar raise why did you need to raise that capital this is wrong you mean the seed yeah uh to be the product like we have a very strong expectation in terms of product and building an api that can scale like everywhere and in terms of r d as well so we race to hire people and uh and start selling and start start figuring out trying to figure out how to how to sell this to the rest of the world and uh to reach the product market fit okay so your first customer obviously you get consulting revenue 400 500 000 bucks in 2018 to fund the business 2019 you land your first customers expense management tool that you won in the sort of the bake off uh how many customers are you serving today uh today i don't have the exact numbers but it's about 70 i think seven zero oh yep okay and you told us earlier sort of the average rp might be like two three thousand dollars per month so that would put you right now mrr-wise about 150 000 a month is that about right no no i think it's uh no we don't uh we don't talk about the the actual revenues so depending on the phase of the clients we are in the kind of the standards of a series a company in terms of revenue and it's less than that i think i don't know exactly when can you break 150 000 a month in revenue will that be next year no it's going to be very soon there's 60 there's 45 days left in this year there's 50 days left in this year you can break it by the end yeah we have a nice growth man like yeah we were wearing 15 monthly uh only with organic growers so yeah that's not uh it's not probably very strong fundamental in general and uh yeah well so so if you're on track to maybe think you know break 150k a month you know pretty soon and you're growing you said 15 month over month that means about a year ago like how much time were you doing about a year ago uh i don't remember and i no i'm not willing to to communicate about the revenue like part uh we decided not to talk about this so [Music] just to be clear i'm multiplying numbers you already gave me so you said earlier 2000 to 3000 per month was an average customer and that you have 70 customers we can just multiply numbers you've already given us to get revenue so that's that's why i'm pushing here yes but you don't have the growth of the customer and most of our customers start with a very low uh revenue because they they just don't want to try to try to go to the solution and they are integrating it and then they expand our time like it's land and expense strategy we have like overall i understand i completely understand that but my question to you earlier was what's the average customer paying per month today and you said two to three thousand dollars that's why i multiplied small two yeah okay that's uh so what you're saying is the average is under that because the first year customers are paying much less before they expand yep makes perfect sense makes perfect sense um so you do the three million seed back in 2019 um why i mean every time you do this raise you're diluting the company right so why go take 14 million series hey why do you need that capital um the main reason is expanding in in the u.s we have flipped the company to a u.s company in may we were in the y combinator batch of winter 2021 and we are going to we are growing the sales team and the operation the pay rating team in general so yeah it's time for us to to expand and to to go faster and we are also specific needs in terms of r d and technical teams as well so just hiring more people and expanding the teams and it's a huge market in the end so we need people to staff on any type of like part of the company finance sales etc how many people are on the team today 27 27 how many engineers uh 20 yeah oh wow so very heavy engineering yeah we are developer tool like it's in our dna everyone is kind of very passionate about developer and software development and data science yep that makes a lot of sense to me and then how are you at so these 70 customers um how many of them you know a lot of people say they go through yc it's great because a lot of yc customers will sign up as your first customer so of these 70 how many are yc companies zero why aren't any y if you went through a batch together with them uh yeah because i don't know we are not really prospecting in this in this batch uh that's a good question like we we haven't been prospecting in the in the yc match we have more um yeah i don't know what to tell you it's uh maybe there are not that many companies doing what we are the best in like finding fintechs and neobanks and hris i don't know got it makes sense so 70 now do you have any concentration in the over 70 is it you know government tag or some anyone else or is it all over the place financial services in general like i see yeah i see interesting okay very cool talk to me more about your organic growth how are you getting the organic growth mostly in bone today with many different channels but we how to say that referral works well we have built some kind of local presence in the in europe and mainly in france as well um [Music] yeah i don't know exactly it's not we have many different channels like paid outbound and inbound referral why does math in general works well as well and we are building a content also to to get more visibility into the internet and we want to be there when peop when developers are looking for the solution so it's something that we have uh created very recently we hire the director of developer relations for example which is responsible for building this content and uh spreading the word out for about 90 in general but yeah today it's important why that math is the the best uh [Music] are you able to quantify are you able to quantify those costs so you know how to invest this 14 million do you know what like fully weighted cac is to get a 2 000 a month customer not yet we're too early for that i guess how do you start experimenting around that is try and get visibility there um can you rephrase how do you how do you try and sort of mature there and try and figure out what that cac is um we have tried paid search and uh as we have kind of very long say cycle not long say cycle because it's kind of low touch but the between the moment people are testing out the product and the moment they deploy for production it can be like three six months and we need at least one year of visibility to try to compute those cost of acquisition for example and we tried something on the page paid search acquisition channel that we started in q2 q3 sorry this year so we don't have enough data to be able to measure that i'm not able to tell you any uh cost of acquisition today i mean i would argue that a lot of your cost of acquisition is tied up in the development team building things like this live test feature you guys have built it's a great tool high utility value you send traffic here people convert right do you have any other tools like this you're looking at building right now just to attract in more users no i think it's it's really about contents like we have you know when the platform you have a very strong capabilities and we can work on any type of document related use case so i think it's about content and showing people that they can pass birth certificates certificate operations bank checks bank details account for like a lot tons of different documents and uh yeah building those contents to have a visibility more visibility when someone is looking for this type of solution is the key for us and that's what we are working on yeah well very cool well hey i want to congratulate you it sounds like this year was the year you guys broke that million dollar run right as you look to keep scaling and on that note i hope you guys grow a ton next year as well but let's wrap up jonathan with the famous five number one what's your favorite business book uh asking is about dallas fees i guess yeah number two is there a ceo you're following or studying uh jefferson yep you're not in any acquisition talks with those guys are you no all right number three what's your favorite online tool for building mindy uh i don't i have the answer for i think salesforce has been something really important for us number four how many hours i sleep to get every night uh between yeah seven to eight seven and what's your situation jonathan married single kids married no kids oh beautiful cats that's important cats and how old are you [Music] 32 32. last question what's something you wish you knew when you were 20 well um no i've never asked this question i don't know uh that i was going to build a great company and i should be more self-confident at this moment in time maybe guys there you have it mindy.com called an api for understanding receipt data other forms of data uh document signing charge 10 cents per page signed or you move up and start paying per api college to start to scale they've got over 70 customers on the platform they've scaled past a million dollar run rate growing 15 month over month just close to 14 million series a this year as they look to scale with our team of 27 heavy engineering 20 engineers jonathan thanks for taking us to the top thank you one more thing before you go we have a brand new show every thursday at 1 pm central it's called shark tank for sas 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 central additionally remember these recorded founder interviews go live we 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