How Nuorder grew Nuorder to $17M revenue and 1K customers in 2018.

everyone my guest today is Heath wells he's a CEO and co-founder of a new order a b2b e-commerce platform that is revolutionizing the wholesale industry he's an entrepreneur art starting his first internet-based business at the age of 15 in Australia and then from for 208 he served as managing director at first media in Australia where he and partner led the company to great success across publishing creative and digital commerce Heath are you ready to take us to the top absolutely my really all right good so tell us about a new order what's the company doing is it a SAS model yeah it's a SAS model so a new order is a b2b e-commerce platform super simple concept we essentially take ecommerce and apply it over wholesale so you have a brand on one side so let's say Lacoste and you have a retailer on the other side who's the buyer and that range is from Nordstrom Amazon all the way to the small mom-and-pop store okay and give me a general sense here I mean are you charging both sides of the marketplace or one side how do you make money yeah so yeah so just one side so brands pay us a subscription fee ranging from around about twelve and a half thousand up to a million per month per year yeah that's per year so we have three you know very separate cohorts you SMB then you have your mid market and then you have your whales in your enterprise yeah so I'm gonna force you to an average just because we're limited on time and can't cover all three of them if you looked at an average customer are they paying what like a hundred grand a year or what's a good at middle spot sub 50 more than thirty probably some 50 so in that range okay that's what we try and look at it you know now that we're a little bit further along you don't just want to look at averages but yeah it's between the 30 and $50,000 yeah yeah again this is just the purpose of the podcast I it sounds like you do have three separate cohorts which is great so call up 30 to 50 grand is a good kind of middle sector space there and walk me through kind of the timeline here when you launch the company what year we actually launched in late 2011 and and full transparency it's been a bit of a slow burn the you know the first few years but it's one of those things where you have to wait for the tipping point to occur and it is literally being the last 12 18 months that it's just been all action and when you parallel that to some of the other e-commerce platforms you look at demand where high breasts on the b2c side they all went through a similar journey so I think you know we were early and really the b2b e-commerce market has really just picked up this last 12-18 months mm-hmm and what have you scaled to today in terms of total customers yeah total customers today is a thousand on the brand side so a really amazing number and on the retailer side it's four hundred thousand okay that's great but yeah for them right free for the four hundred thousand correct yep that's great and you just you've just raise additional capital so how much capital today to be raised yeah so we just we just announced a new raise of 15 million dollars in growth capital so it takes our total raise to close to 40 million and you know what what's exciting about this most recent raise although it's our largest raise it was actually our quickest it took you know 90 days from actually first meeting to close so again just a proof point that you know the tipping point is here and people are acknowledging it he thought operating capital or is any of that 15 going to early shareholders honest that kind of secondary model all operating we you know we're in this we you know when it's when everything is kind of you know unfolding in front of your eyes it's about game on and and and really putting it to work on you know an engineering customer success international expansion sales and marketing and how many months of burn will that new 15 cover for you how much runway to do by yourself so to be honest we can actually turn cash positive we are one of these interesting SAS companies which in 2016 we actually turn cash positive and decided to strategically you know dip the other way given that given the market changes in the growth and so this can actually you know we will only spend half of it and be able to turn cash positive again whether that happens or not let's talk again in in you know you know 12 you know 12 18 months whether that's still the strategy but you know there's there's no we haven't kind of put that out as hey it's two years of burn that's fine I understand you could at any moment go casual positive I get that I pre she ate that but you wouldn't raise capital unless you knew where to invest which would put you into read for a little bit right so before this 15 million dollar round were you back at cash flow positive from Prai around are you still burning we were still burning so in 2016 we'll cash positive and then we've decided to do another small round and went negative again and that's fueled the growth into this one so you know to call it to three years of burn if you want to really go aggressive okay got it so what you're happy kind of burning from a cash reflective like you know 150 to 250 you know thousand bucks a month something like that yeah will push even harder you know depending on the opportunities and so you know it's nice to have a war chest there to be able to you know go after you know interesting you know new business opportunities or as I mentioned international market so yeah we'll push that a little higher and what the team says today we're approaching a hundred people all in LA no we got offices in LA New York London and one person in Australia and so you know we're building out especially New York and London at the moment but majorities you know and it sounds like you have good scale today all right I mean you know $30,000 a CV is twenty-five hundred bucks a month across the bowels and customers that puts you at what 2.5 million bucks a month and Mr R is that directionally correct no it's it's slightly less than that and the reason is you've got to go to look at it you can't just say well what's the current a CV given that there was a tipping point and so you know we do have a couple of customers you know when you look at it you have a couple of customers at the million dollar level you have some you know in the five hundred thousand and then there's obviously a big portion you know in that smaller area and so yeah it's it's definitely double digits just slightly you know less than where you are have you broken the two million a month yet no we will that happen in the near future you'd say yeah yeah like maybe before the end of the year you got 10 20 days left no [Laughter] something magical happens okay good and then help me understand growth so if you're kind of flirting with we'll call it 20 million bucks in ARR today where you about a year ago yeah so it's it's been a really interesting rise where every quarter on quarter just gets more and as we go into 2019 doubling looks like a very clear shot okay so you know less than double this year and we'll do double this next year which we're really excited about because you know when you've got me before you explain it let me just make sure I understood that correctly so yes you said over the past twelve months less than double and so if you're at twenty million bucks and run rate today you're saying last year you're out maybe like ten eleven twelve thirteen million something like that yeah less than that yep sorry less than what I love how you try and you try and get these people and I listen to your podcast I love how you try and corral them but you know less than we were the less than ten million last year okay then that would mean you were more than doubled not less than double no we haven't we haven't we haven't doubled yet because we haven't we not we know that a twenty million market I see what you're saying I see we're saying okay got it that makes more sense got it so less than ten million run rate a year ago whereas most the growth come from expanding the thousand companies already on the platform or adding new logos totally both it's both and so but new logos is by far and away the lion's share so you know we really kind of took a a prioritization to go after the enterprise and so we're adding you know big name brands to the roster and that is really driven the growth but expansion has been really phenomenal so I know you're gonna ask me about churn things like that you know but you must listen to the show I of course right wait and so he make this easy on me just give me the numbers you can share I'm not gonna make I don't want to make it easy on you because I'm a listener so that would be that would be we'd lose the game right tell me about the expansion stuff though yeah so expansion you know we're we're well past in in net churn levels you know we're well past a hundred and ten percent you know we're positive net churn and and you mean hard I just be clear 110% net revenue retention annually correct yeah harder percent churn would not be a good thing no be terrible so and so you know where we are is is in terms of expansion it's pretty solid you know you could call you know 20 30 something percent about revenues is...