How Party.Space Grew 4x to $800K ARR with 26 Team Members in 2022 (Interview with CEO Yurii Filipchuk)

Introduction and Ukraine Update

Nathan Latka

00:00Hey, folks. My guest today is Yuri Filipchuk. He's a CEO and founder at party.space. He's a professional opportunist, financer, investment banker with six years of experience in crypto and traditional capital markets. Also, loves barbecue, a big enthusiast, based in Ukraine, Western Part of Ukraine. Again, building a business. Yuri, you ready to take us to the top?

Yurii Filipchuk

00:19>> Yeah. Hey there, Nathan. Thank you for inviting me again.

Nathan Latka

00:22You bet. I'm excited. Years. It's been a while. Yep. Yep. Hey. So so before we jump in, obviously, sensitive situation Ukraine. We are rooting for you. Are are you safe? Your team's safe? Are you good?

Yurii Filipchuk

00:34>> Oh, thank you for asking. Yep. We are safe. We work, party space is operational but the situation here is indeed hot and really like I still can believe that it's a full scale war in twenty first century going on here so I the majority of my team relocated from the places where they lived now we are in Western parts of Ukraine

01:07>> and we do whatever we could to help Ukraine we we are running fundraiser events We are donating and helping as much as we can.

Nathan Latka

01:16Well, we appreciate that. I hope those of you listening, if you love what Yuri is building, you'll go sign up for his product. Check it out. Again, it's partyspace.com. Yuri, what's the product do?

What Party.Space Does

Yurii Filipchuk

01:25>> So now, party space is the metaverse for remote teams and online communities. And, yes, you're gonna ask right now that metaverse is the buzzword. What's behind that? And I can tell you that metaverse is the environment for engaging events right in your browser, engaging corporate or community events in immersive 3D environments where people can meet, speak. We have video conferencing tools for the communication. We have immersed environment and game mechanics to entertain everyone.

Nathan Latka

02:02Mhmm. And and help me understand customers that are paying you today. What are they paying you on average per month?

Yurii Filipchuk

02:08>> So we are still charging our clients on per event basis. So when we talked last time, I was directly aiming to do the subscription, but it took a year and a half to build the self-service product because 3D and metaverse is is not a joke and it turned out to be a much

Customers and Pricing Model

Yurii Filipchuk

02:34>> heavier task but now we are in alpha stage we have 42 testers who are running their microverses that's how we call those smaller metaverses they have created for themselves and their communities And we are also running one off events for big companies. So I can name drop a lot if you don't mind. So Zapier, Slack, Tremorly, they are our customers.

Nathan Latka

03:00Mhmm. And have you can so so have any of the 42 converted into paying customers?

Alpha Testers and Named Clients

Yurii Filipchuk

03:05>> So our beta test is currently free of charge. And But you told me last time

Nathan Latka

03:11that you you had generated some revenue. Right? You generated like a 100 k or 200 k from a was that a one off thing?

Revenue History and Pipeline

Yurii Filipchuk

03:17>> So when we talked, generated 200 k from 30 clients with the majority from one big client. Last year,

03:29>> also we generated 200 ks over over the course of year with 60 clients conducting events with us and now just in now we are generating 200 ks per quarter and we have like $2,000,000 in pipeline that's 80 deals right now there

Nathan Latka

03:48oh 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

04:12your 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

04:36get 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

04:58not 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

05:23going 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

05:45if 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

Ad Break

Nathan Latka

06:12the interview. That's great. 200 k per quarter is, again, $800,000 yearly in terms of run rate, so you're growing nicely. What are you learning as you add new customers?

Yurii Filipchuk

06:22>> Sorry. Sorry. Oh, what are we learning? So we learned actually, everything changed for us last year when people started calling 3D products metaverse. And then we decided we should build something that we can show to our customers because corporates are not very open about disclosing what we built for them and we created Doge temple. Yeah, you could see it here. So it's a virtual temple dedicated to the Doge meme and that was the beginning of our

Metaverse Branding and Doge Temple

Yurii Filipchuk

06:54>> collaboration with communities. So Doge community, Doge fans, they started gathering regularly there for community events, community calls, etc. And at that moment, marketeers and people who are managing communities decided that metaverse is the next big thing for marketing. So we started selling our product to HRs, people experience managers, but now we have the majority of our revenue coming from marketing budgets.

Nathan Latka

07:23From marketing budgets?

Shift to Marketing Budgets

Yurii Filipchuk

07:25>> Yep. Marketing budget. And so at the moment, like, we are like, the metaverse market is really young, and everyone is still figuring out what's gonna be the best use case for it. So I can tell for sure that the wow effect is something that works really well. And marketing people, they are people, they want to impress the customers. And Mhmm. That's why they're looking for part of this piece.

Team Growth

Nathan Latka

07:48Now last time we chatted, there was eight people on the team. How many are full time today?

Yurii Filipchuk

07:53>> Oh, we are 26.

Nathan Latka

07:5526. And have you raised additional capital?

Funding History

Yurii Filipchuk

07:58>> Oh, yeah. In total, we raised almost $2,000,000.

Nathan Latka

08:03So so you had a 160,000 raised when we chatted in 2020. So you raised another, what, 1,900,000 last year?

Yurii Filipchuk

08:10>> Oh, yeah. We we raised 1,000,000 last year, and this this year, we we raised more.

Nathan Latka

08:18How much did you raise this year?

Yurii Filipchuk

08:20>> So this raise were this year, we raised 500 k.

Nathan Latka

08:24500 k. And and Yeah. And was would you consider that, like, a series a or a seed round?

Yurii Filipchuk

08:30>> I still prone to call this a pre seed,

2022 Pre-Seed Round and Web3 Investors

Yurii Filipchuk

08:35>> and we are quite comfortable with it actually we raised our last 500 ks from web three people from the DAO of 70 funds they invest in tools for DAOs and communities and they brought in those 42 alpha testers like that. So we see a lot of traction from Web3 market and I can say like Metaverse is the preferable UI for Web three products. Mhmm.

Impact of Crypto Market Crash

Nathan Latka

09:07Right now, Yuri. As the crypto markets crash right now, is that impacting you at all?

Yurii Filipchuk

09:12>> Oh, yeah. For sure. We felt that. So we we work with the community and marketing budgets of DAOs and huge protocols. And last month they immediately just cut all the costs there, leaving just very small thing to cover salaries and the crypto marketing is on pause. But I cannot say that about all projects because we still have some other crypto projects and a lot on their community spaces, microverses and stuff. We work with NFT collections,

09:50>> DAOs, protocols, and guilds.

Nathan Latka

09:53Can can anyone listening right now that's just a b to b SaaS company, could they use you or do you have to be in Web three?

B2B vs Web3 Customer Split

Yurii Filipchuk

09:59>> Oh, so no. So that's the problem actually, because when you do the content and marketing for businesses, web three people won't even look there. And when you do that for web three people, that's not of interest for traditional businesses. That's why we have like we are working out dividing that into sub brands where we're gonna continue working with businesses and enterprise clients. And I can say that we see increase of like we work with larger corporates

10:30>> right now. So probably 200 employees is the smallest number of people in our client right now.

Famous Five

Nathan Latka

10:38Mhmm. Very good. Well, we're certainly rooting for you, and it's nice to see you've grown about four x, three x since the last time we spoke. If people wanna check out the tool, they can go to party.space. Right?

Yurii Filipchuk

10:48>> Yep. Yeah. Exactly. Please go there. Test it out.

Nathan Latka

10:52Check it out. Sign up for demo. Yuri, let's wrap up here with the famous oh, go ahead. Do you want to add something else?

Yurii Filipchuk

10:56>> Yeah. Yeah. I I wanted to add that last time we spoke with you, after that, in just two weeks, we received two fifty emails of people who were interested in the value proposition at that moment of the data driven corporate culture. So we talked to a lot of them and that was really helpful. So, Nathan, thank you a lot. That provided a lot of value for us and help us to figure out our ideal customer profile.

Nathan Latka

11:26Well, I love that. I'm glad my audience supporting you and trying you out. And again, I think this is the really the future. And you've built in really incredible, I mean, Halloween themed, corporate themed, you know, cafeteria themed sort of event spaces, and we're excited to see what you do next. So let's wrap up here, Yuri, with the famous five. Number one, favorite book.

Yurii Filipchuk

11:44>> Silks and Zubayar Takor.

Nathan Latka

11:45Number two, is there a CEO you're following or studying?

Yurii Filipchuk

11:49>> Not yet. Not yet. Like, a lot of them.

Nathan Latka

11:53You're busy. Yeah. Yeah. Number three, what's your favorite online tool for building party space?

Yurii Filipchuk

11:58>> Notion and Miro.

Nathan Latka

11:59And number four,

12:01how many hours of sleep do get every night?

Yurii Filipchuk

12:04>> Still eight hours.

Nathan Latka

12:05Okay.

Yurii Filipchuk

12:05>> That's the only way to keep rolling.

Nathan Latka

12:07And situation, married, single, kids?

Yurii Filipchuk

12:11>> Now I have a stable relations, and I have a girlfriend.

Nathan Latka

12:15That's great.

Yurii Filipchuk

12:16>> She's here with me.

Nathan Latka

12:17Hi, girlfriend.

12:20Alright. So not not married. No kids. And you're twenty twenty. You're 30 now?

Yurii Filipchuk

12:26>> Yep. I'm 30, and I've missed the Forbes 30 under 30 list. Unfortunately, I gonna do something to that.

Nathan Latka

12:34Well, that's why there's a 40 under 40 list.

12:38Yuri, last question. Something you wish you knew when you were 20.

Yurii Filipchuk

12:44>> Still something about Bitcoin. That would be

12:48>> a moonshot, but why not?

Nathan Latka

12:50Yep. Guys, party. Space is where everyone in Web three is hanging out virtually, but it's also applicable to your B2B SaaS virtual events on top of things like Hopin or Zoom webinars or things like that. Check it out at party.space. They were doing $200,000 a year back in 2020. Now on track to do 800,000 this year, working with 42 customers. Raised about $1,700,000 to build this out, doing this all from Ukraine. So he's not only building

13:11the business, but also supporting the country as they go through this this war with Russia, obviously, rooting for you guys, Yuri.

Ukraine Fundraising Efforts

Yurii Filipchuk

13:17>> Yeah. We we helped raise 800 ether for Ukraine in a collaboration with the Meta History, which is the digital museum of war so yep we we are trying to do our best but still if you can support Ukraine please do and also together with G2 we have the collaboration. So if you leave review for party space, G2 will donate $20 to Ukrainian humanitarian funds.

Nathan Latka

13:48Guys, there you have it. You know what to do. Go support this guy. Yuri, we're rooting for you. Thanks for taking us to the top.

Yurii Filipchuk

13:54>> Thank you. Thank you, Nathan.

Nathan Latka

13:57One 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 one

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