How Peoplegrove CEO Adam Saven grew to $17M revenue and 170 customers in 2024.

hello everyone my guest today is Adam Savin he is a the co-founder of people Grove and has served as its CEO since inception he previously worked at Google as a business analyst from 2013 to 2014 performing data analysis as well as informing strategic decisions on the online partnerships group before Google he served as an investment banking analyst in the global technology group at Credit Suisse he owns a BS in economics from the Wharton School of the University of Pennsylvania Adam are you ready to take us to the top all right talk to me all people Grove what do you guys do and how do you make money job is all helping students access mentors coaches people they need to succeed how we make money at universities license our software bring this to their schools and make this a reality interesting peer play SAS model exactly enterprise software and what is I don't know going on every cohort what's the average customer pay per month would you say I mean it's big spectrum we've got initial contract size and you know you 15 to 20 K per year all the way up to six digits no yeah what would I know I don't wanna go down everyone but all just an average is 30 40 grand a year all right something in there okay good and let me just break that down for me so someone that pays you 30 grand per year what are they getting is it number of seats or what yeah so we you know we have posts and modules because we're working with enrollment offices to drive yields academic success to drive graduation so it's it's based on what modules their their licensing from us and the size of their institution universities tough tough for them to do per seat because they need starting to your budget yeah and otherwise you have to get approval every time I need more seats right which is a pain in the butt exactly so you know we're talking we typical term like three year term got it all cash upfront uh annual upfront so we don't not the full three years but I'd be pretty impressed if you're pulling three years revenue forward all the way they agree if it happens yeah that's great all right put this on the timeline for me when did you launch launched by walking into an office at Stanford with a pretty powerpoint and no real products I was owned of 2015 they're like great we're making a decision in in two months we sprinted got a product out in early 2016 and a really good customer logo to reference that's okay so you close Stanford last timer number one I love that all right what do you say in terms of total customers on the platform 170 institutions okay that's great and these range again from colleges did you sell directly to kind of companies or no vast majority of our partners are higher ed we do have for America that uses the product between their current teachers and their alumni network and we also have some pilots going with Intuit and Qualcomm as a way of building mentoring around their new student their new employees not if I take 170 customers times that are pro you just articulated that puts you about four hundred twenty grand per month or a little over five million bucks and a or is that generally accurate average contract size closer to 2020 yeah okay so cliff if we if we pull that contra value down that means your call call it maybe 280 grand a month something like that well you know running towards four yeah that's good a win do you can go pass for this year sorry you need end of 2018 nice I like that and what is growth been like historically so past 12 months you know where were you in August 2017 at 100k Wow so that's I mean that's pretty good growth you're going from 80 grand or 88 grand a month up to call it 280 today what's driven most that growth we were luckier is a seed around exactly 12 months ago so one scaling out sales model is just landing in with an individual Department out of school and then our CSM's do a great job of identifying opportunities to expand and so it's not only new business but a lot of experience revenue you mentioned a seed around how much total have you raised today so I have this whole other story of a failed company but this particular one was 1.8 and then we have some convertible notes so a 2.5 total to five total quickly give you the failure storage arrays bunch of money and just crash and burned no didn't raise that much lived out of a trailer park and rented both that so we can just keep this thing moving but it was your classic think of a great idea sitting in a room not validating it at all and that was tinder for jobs did not work for a million different reason but a breeze learning experience interesting okay so obviously you know shut that one down 2015 you get back into people Grove wasn't a pivot right you actually shut down that first company no it was a it was a pivot in shut down in terms of had a staff of eight went back to two had about 10% of the initial funding left and just somehow like made a turnaround what year was that so that was shut doors like middle of 2015 at that point our investors are like well it's not really worth you giving us our money back until you have any other ideas in you and yeah I just started grinding back and that was turnaround and he had what caught 250 grand in the bank at that point no 10 2002 nor 20% okay that's way less than that he had 10 or 20 pay left in the bank but we closed Stanford we had our additional convertible notes of 500k we were down to 20k in the bank I see oh wow okay good so a big turnaround now what do yet today in terms of total team 3232 and where's everybody based eighteen here in SF we've got an offshore team in India 14 they're great and that's a there's a lot of people that ask me they go Nathan how are these people on your show launching these extremely efficient dev teams in India especially when one of the founders is not from India or you know Kiev Ukraine or those places in Argentina how did you spin up your India team I really like our one of our early engineers was a guy named Nitin um very well experienced and he was our first he was a full-time engineer for us and he just took I mean that's actually fun he said hey I've got a actually her brother who's also looking for a job I can definitely vouch for him all of a sudden we had knit into cash two brothers and next thing we do it we're making trips out there we knew they had the capability to lead and build a team out there so yeah I think the key thing is is having two people that you really trust know what quality looks like and then my CTO makes trips out there he knows what good code looks like and the rest follows that's so that's so funny good story there all right um so I assume today you're profitable right oh we could be if we weren't okay being the hiring good so are you operating at breakeven I mean if you had no money in the bank and you closed a deal I mean you can't afford to go on the red otherwise you've got a business or you got breakeven no we're good like ash balance wise the amount of money we raised a year ago is the exact balance we have today oh you've raised more than two point five no no I'm saying our cash balance today is the same as it were after we raised so each month were about breakeven sometimes you know net burn is a little bit negative with the new hiring we're making yeah sorry I'm just trying to get us on a time line so you'd raised five hundred grand you took that down to nothing in 2015 when you pivoted you didn't raise another two million about a year ago and what you're saying is you basically have kept all out the bank oh I see oh great so you just just revenue revenue berta has been about equal yeah that's great so it's good good position there talk to me about churn you know turns critical in a SAS company where you guys at customer logos 96% so of our 174 total have turned that's retention annually customer retention and yeah for us product customer actually wasn't a great fit to begin with what's more exciting is the net churn so you know while the logos we churn represented about 50km ACV our expansion revenue has been over 500k so net shirin looks really good yep net negative turn there do you know kind of annual net annual retention you're north of a hundred percent do you know about how much 120 yes that's that's those are good numbers what about acquisition what are you spending to acquire customers we've had a great answer for you right now you know it's a sales effort to a he's working at it let me ask let me ask kind of a different question how quickly do you like to get your money back so if you pay an account you know county executive a commission things like that do you get a payback and call it three months four months ones the points that customer profitable when is the what is our new world we're getting that you know and no contract size upfront so for a new AE if they're closing for deals they've already paid for themselves yeah I don't know I got that so if you sew a new customer let's say is paying a thirty forty or call it twenty grand a year is what you said I think earlier right if you pay you know ten grand to acquire that customer on a cat on a deferred based not a cash based on our deferred basis that's essentially six-month payback right on a cash basis you're getting the full twenty right upfront so it's instant but on a deferred basis is it about a six-month payback I don't also don't to make up numbers that you don't actually use to measure so let me just ask you a general question like how do you think about cash allocation through your sales team and your payback periods yeah like you know we have an efficient business but you know my I'm not myopically focused on payback period or cost to acquire customers focus on how redoubling rather new tripling rather okay fair enough but like just to be fair like you can't grow revenue if you have no money to grow the revenue which comes back again to like like how efficient these AES can be yeah well I mean we're very efficient because let's GE is 150-160 break down what that means for people I don't know the acronym ot you know on target earnings so they're hitting quota they're taking it home 150 160 and their quota is let's say 720 kb cv like it's just it's efficient the model works so so why not go out why why do you only two people that on that team why isn't it 20 people founder can sell he's two can sell next stages now we're doubling up the sales team but for me I'm cautious not to over higher I need to prove that the playbook is there before putting others in a position to 6800 foot yeah are you raising capital right now we haven't we haven't sought it right now the cash balance is good and we have all the incentive in the world to just keep growing the business organically if we have the cash hmm okay so no plans kinda raise capital right now or at least you're not it's not something you're pursuing you never want to say you're pursuing capital because then you look weak but I mean if someone made you an offer when you're open to right where we're doing it let's say if you had let me ask you differently if you had another five million bucks where would you invest it you probably development yeah I mean that's something we're thinking about now right now so as a team we don't have a VP of Sales we don't have a VP of customer success there's a lot of hires we could be making so be honest the question you're raising is a question we're thinking about right now but it's not so you know too much over mindshare are you in any acquisition talks right now to sell the company shouldn't share that okay interesting it what would drive that decision for you guys to take this crazy or take an acquisition offer and no no I like to sell or not to sell in your mind what what what do you think about anything about both those options you think about you know if there isn't acquire what's what's their plan how do you fit into their plan you think about timing you think about you're your own personal objectives where are you in your life and what matters to you you think about your mission and vision how you're gonna get there and do you do it alone do you do it by raising money from investors do you do it by way of working with another so it's a lot of a lot of different factors to consider if we're lucky enough to consider those factors that's great but for me like the best thing you can do is just focus on growing the business and all those kind of follows Adam let's wrap up here with the famous five number one what's your favorite business book give and take give and take by Adam grant number two is their CEO you're following or studying right now now number three how many oh sorry what's your favorite online tool for building your business I think outreach number four how many hours of sleep to get every night five or six it's pretty good in what situation married single kids fiance just got engaged last month no Congrats it's exciting no kids yet no kids I've got an amazing puppet that's getting how are you Adam I am twenty eight twenty eight last question what do you wish your 20 year old self knew well I guess twenty I'm in college focus less on grades focus more on people and helping others and you can build an amazing uh from okay this interview is for all of you college students right now worrying about your 2.8 GPA worry less about grades more about hustle Adam created its company after a pivot in 2015 really got focused on people Grove land it's Stanford as their first customer today they've got a 170 customers paying call it 20 grand per year so about you know 280 grand per month right now in revenue that's up from 88 grand or about a million bucks in ARR just a year ago in August of 2017 they've done this in an extremely capital efficient way they raise 2.5 million bucks most recently 2 million about a year ago which is all basically still in the bank economics are healthy ninety-six percent local retention annually about 120 percent net revenue retention annually because upsells are going so well gotten team of 32 people based between San Francisco and India Adam thank you for taking us to the top