Pipelyne Revenue, Valuation & Funding (2024)

[00:00] Hey, folks. My guest today is Adrian Casey. He's a qualified civil engineer from University College Cork. Following his degree, worked as an IT consultant for Accenture and PwC in Dublin and Toronto. In 2018, he co founded Ireland's first online HVAC and solar PV installation business. And in less than three years, grew that business to be one of the largest installers in Ireland, thanks to its focus on the digital customer journey. Having seen how popular [00:22] this was, he launched a SaaS product called Pipelyne.com. The company helps home service companies double their inbound leads with no additional marketing spend. It's the first in a range of products he hopes to develop this year to bring home service companies online. Adrian, you ready to [00:37] take us to the top? [00:38] >> Absolutely. [00:39] Alright. I always love someone building something to scratch their own itch. It sounds like you've done that, [00:44] >> That's exactly it. Yep. So, yeah. [00:47] Are you are you still running the physical business, the actual HVAC and solar panel installer? [00:51] >> So, we still have that business. So, what we actually have is we we have a holding company and we have Swift Energy, which is our HVAC and solar PV business, which my co founder is heading up, and I'm heading up Pipelyne, which is our our SaaS business. [01:04] Interesting. Okay. So Swift Energy, when did that officially launch? What year? [01:08] >> Yeah. So that was back in January 2018. My my co founder and I saw a gap in the market and that the installation of energy services in Ireland was very much offline. So, we set setting up an and solar PV business, an online HVAC and solar PV business. Since then, we've grown that business to be one of [01:29] the largest in Ireland. [01:30] >> There's nearly 100 people now between full time staff and actual contractors. But when we started initially, we looked at existing software in the market all the way from lead generation forms through to actual e commerce platforms like Shopify, Magento, etcetera. And what we realized is that they were very much focused on product based businesses and didn't meet the intricate needs of service based businesses. So we ended up building our own technology. [01:52] That makes a lot of sense. And what's that website? Is it swiftenergy.com or dot ie? [01:57] >> And swiftwithay as well. [01:59] Swiftenergy.ie. Okay. Very cool. And give me a sense. I mean, a 100 full time people. You launched in 2018. How much revenue did that business do in 2021? Just that business. [02:08] >> Yeah. So we we started in 2018. As I said, we did about 2,000,000 in our first year, but up to five in the second year, and then we were on track to do 10, and then COVID hit. So we should be back up at around the 10,000,000 mark this year. [02:18] Okay. [02:19] Well, very cool. So, guess the reason I asked that question, it must be hard to walk away from a business doing $10,000,000 revenue to take a bet on a new idea. That's the SaaS business. How did you have that conviction? [02:30] >> Yeah. I suppose mainly because we've seen the value of what the technology has delivered for us and we do genuinely see a big gap in the market in that service businesses around the world are very much offline. The Swift Energy business is very much set up to scale and we have a great management team in there as well to be able to grow that business. We brought in an operations director as well who's heading it up [02:49] >> on the ground. So, you know, that has given us the the freedom to be able to go and pursue the the SaaS piece as well. [02:54] Okay. So when what year did you write the first line of code for the SaaS business? [02:58] >> So we started that around the middle of last year. So probably around July, August last year. And it was very much taking what we have built already and turning it from, you know, a standalone solution into a multi tenant SaaS product. [03:09] So how did you officially spin that out? Does Swift is Swift on the cap table of Pipelyne? [03:15] >> Yeah. So, as I said, we have a holding company, and all the investors are at the the holding company level. We transfer the IP from Swift Energy into Pipelyne last year as well. So the IP is in is in Pipelyne, and then we're licensing the technology back to Swift Energy. [03:31] I see. I see. I see. So Swift Energy is your biggest customer? [03:34] >> Exactly. Yep. Okay. [03:35] Very cool. What does the cap table at the SaaS company look like? Like, do you own majority like a traditional founder would? [03:43] >> No. So there's two of us in the business as co founders in in Swift Energy initially. So I said we're all at the holding level, and everyone is at the same percentage. So any investor that came in after that as well is at the is at the the holding level. [03:57] 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 [04:20] 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 [04:44] 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 [05:06] 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 [05:32] 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 [05:54] 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 [06:20] the interview. So you and your cofounder split Swift Energy fifty fifty, and Swift Energy now owns also 50, well, a 100 of of Pipelyne? [06:31] >> So Swift Holding Swift Holdings owns a 100% of Swift Energy and a 100% of Pipelyne, and myself, my co founder split Swift Holdings fifty fifty. [06:39] I see. I see. Okay. And you mentioned investors a couple of times. Have you raised capital? If so, how much? [06:44] >> Yeah. So we raised capital. So we raised capital for swift energy. We raised about 3,000,000 for swift energy over the few years from 2018 to 2020. And before Christmas, we raised 1,500,000 for Pipelyne. [06:58] Okay. So you raised 1,500,000 at the end of last year. That was, I guess, your seed round. Most companies are selling 10 to 20% in sort of your pre seed round. Were you guys sort of in that range? [07:08] >> Exactly. Yeah. Pretty much in the middle. [07:10] Okay. Very cool. So if you're, you know, selling 15% of the business, that's sort of like an $18,000,000 to $19,000,000 pre money valuation, 20,000,000 post, something like that? Yeah. [07:17] >> Yeah. [07:18] Yeah. That feel fair to you? [07:20] >> Yeah. I think so. With everything that's gone with COVID and everything at the time, so pretty happy with it. [07:25] And how do you balance sucking team members out of the main Swift Energy business into the SaaS business? Don't you sort of, you know, eat your own eat your own kids a little bit? [07:34] >> Yeah, so we had an IT team in Swift Energy and they've come over now into the Pipelyne business. There's about eight of us in Pipelyne, pretty much all kind of product, but we are now starting to grow the sales and marketing side as well. So, they are two separate businesses like that. [07:51] I see. Okay. So, eight on the team right now, and obviously, Swift Energy is your biggest customer. Talk to me about what Pipelyne is delivering. So, is it literally marketing automation for services businesses? And if so, how do you charge? [08:04] >> Pipelyne is in the first product we're launching at the moment. So, it replaces a contact form on a home service businesses website with an engaging form that asks the customer for their information in a conversational way. And then we utilize that data to provide the customer with an instant estimated cost for the service that they're looking for. To give you an example, if you're a HVAC business that installs gas furnaces, instead of driving all your Google [08:27] >> traffic to your static contact form, instead you direct it to Pipelyne where you can ask the customer a series of questions like the property type, the fuel type, the square footage, and you can then provide an instant estimated cost for the service. And because the customer is being rewarded for submitting their information, I. E. They get to see an estimate, we're seeing an average of 220% increase in leads for people using our form. [08:49] Interesting. And obviously, you'll be able to pass on more data as well because you're asking smart questions which get tagged to that contact. [08:55] >> 100%. So you can route accordingly on the back of that. [08:58] What are companies, what are gas companies or gas boiler installer companies paying on average per month to use Pipelyne? [09:05] >> Yes. We have a number of different price points. $99, a $199, and 299, depending on features. On average, we're at probably about a $150 at the moment across all the teasers that we have. [09:17] And what's so are you only upselling? So if someone pays $99 a month versus $299 a month, at $299 a month, are they getting more products or do you upsell based off number of seats or number of leads or any other upsells besides just product upsells? [09:29] >> Pretty much product upsells and the number of submissions as well at the moment. In terms of upselling down the line, our goal this year is to launch our e commerce store, the one that we have in Swift Energy. We're looking to move that over into the SaaS product as well. And that is our goal here is to, you know, start with the with the the estimator piece and then upsell the actual ecommerce store. And that's our [09:50] >> big vision. [09:51] Interesting. And obviously, your own company was the first customer. How many paying customers do you have today? [09:57] >> Yeah. So we have about 50 users altogether and 50, but about half of them are paying. [10:02] Okay. Got it. And when you say users, are those companies, 25 companies? Companies. Sorry. Yeah. Okay. Do do you have a per seat model? Does the company pay for five seats, for example? [10:13] >> No. Not at the moment. [10:14] Okay. Okay. Got it. So 25 companies paying $150 a month on average. You guys are doing about $4,000 a month right now in revenue. Right? [10:22] >> Yep. [10:23] This is great. So and and I guess what percent of that is coming from Swift Energy? [10:28] >> Just one Swift Energy is just one customer. So Okay. [10:31] $200 a month. [10:33] >> No. We are we are charging it extra for the ecommerce store, so that that's costing a lot more. But for the actual lease that we have now, it's $150 [10:41] And so, explain to me how that works. Again, I'm a gas boiler sort of installer or an HVAC installer. I use pipelyne. You're sending me leads. Let's say you sent me a 100 leads for, you know, Northern Ireland last month. Help me understand how the e commerce store would work. [10:57] >> So, the actual leads piece, you actually put it on your own website and you white label it as your own. So, it's not like a marketplace, if that makes sense. It's on your own website. And then the e commerce piece, you know, the typical journey is for a home service business, need to send an engineer on-site that actually views your property and gives you a quote for your boiler or your furnace. And today that is sent [11:16] >> in a PDF quote, which is pretty static. On the e commerce, what we do is we convert that static PDF quote into an actual e commerce store where the customer can add on additional products such as a smart thermostat, they can pay for warranty packages, they can apply for finance, they can schedule their installation online. So you can really think of it as converting any quarter invoice into an e commerce store. [11:40] I see. Yep. That makes sense. Makes it a live cart experience where you can upsell, down sell, etcetera. Talk to me, you casually mentioned their financing. Have you guys raised a big debt facility to finance against quotes or do any sort of lending offer any lending services? [11:54] >> Not at the moment. It's like on the Swift Energy side, we're working with a third party, but that is a big part of the market opportunity that we see is one percentage of GMV when we launched the e commerce store and two, the actual financing piece as well. [12:08] Now, you just got this going last year. You're just now adding customers. You're at 25 today. [12:13] >> How do you [12:14] go from 25 customers to 200 customers? What's the main growth channel? [12:18] >> Yeah, we're actually still pre launched technically if you go to pipelyne.com. We haven't fully launched, so it's kind of been organic. One of the ways that we're building it is looking for networks of businesses that have a large network of home service companies. For example, if you're a marketing agency or a web designer agency or development agency who might have 100 home service companies working for you, know, we have at the moment we're working on an [12:42] >> affiliate program, but we're looking to also potentially roll out a white label model there as well where agencies can use it for their clients. [12:48] Interesting. And how do you plan to go find those agencies who will then use it for their clients? Like, do you find them on LinkedIn, Facebook groups, somewhere else? [12:58] >> Both, really. Yeah. So, LinkedIn. So, we've actually engaged with sales outsourcing team based here in Cork. So, they actually work with startups to help scale the businesses. So, they've given us an agent who is doing LinkedIn LinkedIn outreach at the moment. [13:15] Who who is that, by the way? I'm always looking for resources like that because it's a number one request that I get. Who are you using? [13:21] >> They're called Otonomee, O T O N O M E E, I think. So the guys there, you know, they've ex worked with Stripe and Airbnb, etcetera. They're, you know, they're they're really experienced guys. We brought them in to to kind of consult and also give us resources. [13:35] Are they actually are they I mean, are they actually hiring reps inside of Otonomee to run your sales calls and things, or are they hiring someone that you can bring on as a full time employee inside of Pipelyne? [13:48] >> And also, it's it's the the first one you mentioned there. So they're actually running into their business, and then we're consulting them in. [13:54] Interesting. Are you let's say you fall in love with one of the reps they put on your account. Do they let you hire the rep full time or is that a big no no? [14:02] >> I haven't had that conversation with you know, I've worked in consulting before and it's it's it's a big no no in IT consulting. So I imagine it's the same in in the sales consulting. [14:10] Yeah. It's slowly changing. I mean, there's a bunch of outsourced SDR shops that I recommend to founders, and some of those shops are now letting founders hire trained SDRs after six to twelve months of working together. There's a big fee for it, obviously, because it's, you know, that's tough, but it's a new model. Yeah. [14:26] >> That's interesting. I haven't had the conversation yet, but we'll see. [14:29] Otonomee. Very cool. Alright. And Got it. And so, Is the pricing model that you pay those guys more sort of like a retainer? Just a monthly retainer? [14:37] >> Exactly. Yeah. Okay. [14:38] Interesting. Very cool. Okay. So using those guys to help you scale, you're at 25 customers today, you raised the 1,500,000. Where are you investing most of the money? [14:48] >> So product in terms of product additional features, the existing product, and as I said, moving the e commerce store into the SaaS platform. And then it really is marketing and sales. We just bring on a marketing person now on board as well, and it's about ramping up that and start getting some inbound leads rather than just pure outbound. [15:08] How many folks are on the engineering team right now? [15:11] >> So we have four altogether. [15:12] Okay. Got it. So four on the engineering team, four others, one of which is a marketing employee? [15:17] >> Yep. [15:18] Okay. And talk to me, obviously, every founder, the number one thing is don't run out of cash. So how are you managing burn? You raised 1,500,000. How much are you comfortable burning per month? [15:30] >> Yeah, probably, you know, $30,000 mark, probably $30,000 to $40,000 is probably where it's at. But I mean, we do plan on raising a lot more, I suppose this year as well. But really, I don't want to do that until we actually get some proper traction because we want that valuation going up. [15:47] Yeah. What revenue metric do you want to hit before you start thinking about raising your seed round? [15:54] >> You know, I'm ambitious and I'd love to get to the 85,000 a month mark. [16:00] >> You know, we also have probably an option, to be honest with in terms of debt as well in the holding company. So, that might be something that we could do a mixture of [16:09] >> equity and debt because we do have this Swift Energy business as well there, is generating profits. [16:14] Mhmm. Would you ever use debt against your MRR? So, like, there's all these firms that would take 5 k of MRR and give you, you know, $50,000 upfront today sort of thing. [16:23] >> Yeah. I haven't looked into it in detail, but it's something definitely on the list all right to look at. [16:29] Because I've heard about it, and I've heard it [16:30] >> in your podcast as well. You've mentioned it a few times. [16:32] Yeah. Yeah. We do it. That's my other business. That's why I ask. I'll follow-up afterwards and see if we can I mean, we love stories like this? I especially love your story because one of the pattern like things that I see from doing over 3,500 of these interviews now, the most successful SaaS founders come out of building software for their own other business. Yeah. And like you perfectly fit that prototype. So makes a lot of sense [16:55] to me what you're doing. Cool. Okay. So think about maybe raising later this year debt or equity. We'll see what happens there. Again, eight on the team. No churn. Right? Once people sign up, no churn yet? [17:05] >> I think it's too early to to even mention that. We haven't, but it's too early to say, I think. [17:09] Yeah, guys. Adrian Adrian's not kidding. If you go to pipelyne.com, you'll see it's literally landing page with an email opt in. Says launching March 10, and we're recording this here on March 3. So it's literally not launched yet. [17:22] Adrian. Right? Adrian. Right? March 10 is the launch date? [17:28] >> March 10. Sorry. Yeah. I think I lost you there. Yeah. [17:30] >> Yep. Very very cool. [17:31] Alright. Let's wrap up here with the famous five. Number one, favorite business book. [17:35] >> Probably my favorite book is Shantaram. Who? Shantaram. It's not a business book, but it's a it's a it's a novel. [17:43] What what sorry. What is it? Shantaram? [17:46] >> Shantaram. [17:47] How do you spell that? [17:48] >> S h a n t h a r a m. [17:52] What's it about? [17:53] >> So it's a guy in I think grew up in New Zealand, ended up getting, I think, arrested over there, escaped from prison, moved to India, and just lived a crazy life in India on the streets. So it's kind of based on a true story, but it's just a crazy it's crazy life story more than that. Yeah. Yeah. Yeah. [18:11] It's a novel. Gregory David Roberts is the author. He's talking about Pentridge Prison and all that. Right? [18:16] >> Yep. That's exactly right. [18:18] >> Yeah. Very cool. I've had I've heard some other founders mention that book, so it makes sense. [18:21] Number two, there a CEO you're following or studying? [18:24] >> Not really. Probably more following businesses. I listen to a lot lot of your podcasts, Nathan. So [18:29] People always go, Nathan, why did why do founders agree to come on? They know they're gonna have to give up all these numbers. So I can just ask you why you know the show, you know the format, why'd you say yes? [18:40] >> I think I think I actually like the way you you interview in terms of straight to the point. Then you get, know, especially you get to listen to businesses at all different stages, and I think that information is valid. Yeah. [18:50] Yeah. Well, we're excited to get you up on the website and feature you guys. I predict huge things for you. There's just the pattern. Again, I love the ability to, like, see patterns is what I crave the most, and I see a very obvious one here. So I'm pumped for you guys. Number three, what's your favorite online tool for building a business? [19:04] >> So probably YouTrack is what we use. [19:09] >> YouTrack. [19:10] Number four, Adrian. How many hours of sleep are you getting every night? [19:14] >> It depends anywhere between four and eight. [19:16] Okay. And what's your situation? Married, single, kids? [19:19] >> I'm single. No kids. [19:21] No kids. And something you wish you knew back when you were 20? [19:26] >> Definitely start younger and start a reoccurring revenue business as well. [19:30] I love that. And how old are you now? [19:32] >> 32. [19:34] 32. Guys, there you have it. Adrian launched Swift Energy back in 2018, grew it to 1,000,000 in revenue, then 2,000,000, up to 5,000,000. They were gonna do about 10,000,000, then COVID hit. They're back up now to about 10,000,000 is what they'll do here in 2022. As he was building that business, said, you know Our marketing engine is robust. This needs to be a SaaS platform for all services businesses. That's what they've launched. They've spun out a [19:54] SaaS tool called Pipelyne, with the Y. They've got 25 customers, $50,000 in ARR today. About grand a month in MRR, raised 1,500,000 at around a 20,000,000 post money valuation back before Christmas last year to keep scaling this. We'll look and consider it raised later this year if they're able to get revenue up to around the million dollar mark. We'll see what happens. Adrian, thanks for taking us to the top. [20:13] >> Great. Thanks, Nathan. [20:16] 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 [20:41] 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 [21:03] fundraise, a big sale, a big profitability statement or else. I don't want you to miss it. Additionally, if you want to 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 [21:25] 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, I do it so that we can all learn. We have to counter those people. We got [21:45] 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.