Prism.fm Revenue, Valuation & Funding (2024)

[00:00] Guys, prism.fm helps event venues organize with artists and collab on all kinds of show types. Obviously, took a hit during COVID. I thought Matt was gonna totally die, and he just had unbelievable willpower here, got through it, went to a low of, call it, $50.60 grand a month, has now scaled much larger than that, call it over a 150, $200 a month in revenue. 300 customers today, new customers paying on average $11,000 per year for the [00:24] platform as he looks to scale, close to 5,000,000 series a in 2021, potentially looking at now as well. We'll see what happens. But he says he's very close to profitability, team of 27 looking to build more payments potential payments products for the same industry. Hey, folks. My guest today is Matt Ford. He's the CEO of prism.fm. He's a spiritual seeker living the good life in Austin, Texas. When he's not running prism or play he's playing music, [00:48] hand hanging with his kids, or enjoying nature, prism helps unfuck the live events industry, which we love. Matt, you ready to take us to the top? [00:57] >> Yes. Yes. I didn't write that, did I, about unfucking the live music industry? [01:00] Write that. I that is verbatim. Don't try and put that on me. But it was it's it's been great following your story because you first came on in 2018 when you had just broke 15,000 a month in revenue, and I'm going, oh my god. My guy, Matt, he's gonna have a hard time during COVID. There's no live events going on, but you made it through COVID with a ton of momentum. I guess, why don't you touch [01:20] on that real quick before we get an update? [01:23] >> Yeah. Yeah. I mean, you're saying touch on COVID? [01:27] Yeah. Well, just touch on, yeah, how you made the company sustainable through COVID when revenues, I mean, flatlined or shrunk. [01:33] >> Yeah. I mean, we had you know, twenty twenty eighteen, 2019 was us getting off the ground, and then we had so we had virtually, let's call it, fourteen months in the market before the pandemic hit. And I know this is a little against your you know, what you typically, you know, look to see an entrepreneur, which is the whole bootstrap methodology, but I had raised money at the end of twenty nineteen. [01:55] I don't mind raising. I just don't want I want the founders to get rich when they do it, you But, yeah, you'd raised a million seed in 2017 and a 2,900,000 extension in 2019. Right? [02:06] >> Yeah. And I and I know you're not, like, totally against raising money, but, like, the timing of it was ridiculously good. I mean, at the end of twenty nineteen, we had couple million dollars in the bank, and I I scaled down to a bootstrap team at that moment. You know, actually, funny enough, I'm I'm full steam ahead profitability these days. So I'm I've I've come around to really [02:25] When are you pro were you profitable in June of this year last month? [02:29] >> We're we're we're working towards that. We're not we're not quite there yet, but we're we're using our runway to get to there. And and it's I could we're in a in a healthy place right now. I'm just being completely honest with you. Like, we're, you know, we're like, I could make some cuts tomorrow to be profitable, but we're in a healthy place right now and have some money in the bank. We're just kind of coasting to [02:50] >> profitability at this point now. It's really right around the corner and it feels good. But, you know, we weren't in 2019, so some funding helped us get through that. And it it really allowed us it allowed me to keep a team of engineers that were working on the product and and we had a Which were how many? [03:06] How many engineers at the time? [03:07] >> We only had like four people at the time, four engineers working on the product. And I had, I think, maybe, you know, three kind of customer success and salespeople that we kept part time to go into the trenches with our customers. So keeping product development strong during that time and going into the crisis with our customers, it allowed us to- I mean, it really accelerated our impact on the industry. And then on the other side of [03:32] >> the pandemic, we've 5x our revenue since the bottom of the trough. We also didn't churn a lot during the pandemic, which I think was a major testament to the technology. Like, we went in with, let's call it, 120 customers. We came out with, of those a 120, we we came out with, you know, a solid a 100 of them. Like, we didn't we didn't see much churn. [03:54] Where are you today? Just total customer count. [03:56] >> We're coming up on 300. [03:58] Yeah. That's great. So it's 60 more than when we did an interview exactly one year ago, which is nice. We'll touch on that here a bit more. But, keep the story going because didn't didn't you also raise did you raise a series a in about in 2021, July? [04:09] >> Yeah. Yeah. We we raised a series a in 2021, $5,000,000, and, you know, grew grew the business quite a bit. And You [04:19] sold think you told me you sold about 10% of the company in that round. Right? Like, a 50,000,000 valuation, something like that? [04:26] >> I can't exactly remember what I what I what I what I told you, but we there was, you know, there was some decent dilution in that round of funding. [04:37] >> Shoot. I'm sorry. What were you asking me? [04:39] Well, no. I mean, touch on that. Right? I mean, let's say you diluted more than 10% in the series a. The seed round, you diluted there, you know, maybe fifteen, twenty percent. I mean, how do you think about just founder dilutioning and managing your position in the company? [04:49] >> Yeah. Absolutely. I mean, I'm like I was saying, now, you know, let's call it three year if you take away the pandemic, we've been three years in the market. We have really solid product market fit. We have negative net retention. It and and we have a better understanding [05:03] >> of what negative churn. [05:05] Right? Negative churn. [05:07] >> Negative churn. Yeah. Positive net retention. Thank you so much. Yeah. Yeah. With one of our customer segments, it's it's segments. It's it's net retention of a 127%, and across our whole customer base, it's 110%. For me [05:20] That's impressive. [05:21] >> Yeah. For me, it's like I was grateful to Raiz when it was kind of this pie in the sky like, hey, fuck it. We think there's a big market out there. Let's go and find some investors that believe in that as well, the sky's the limit. But over time, I think we've become more and more rational about how big of a market is. I'm going use some made up numbers here. But in the start, let's say, [05:41] >> Hey, we believe the TAM is 500,000,000. So it's like, All right, sure, go and raise however much we want. But over time, I think it's really important for an entrepreneur to get more realistic about what the SAM is versus the TAM and what the true TAM is. And now that we've had three years in the market, it's just quite obvious that this business should be sustainable and profitable as a default. And there's always more things we [06:02] >> wanna do with innovating. We're considering adding payments onto the platform. We're considering what other customers we can expand into. But if we're if we're doing that from a place where the core business is profitable, then we're not having to, like, fundraise to, you know, to avoid a layoff at the same time that we're evaluating these new options. Like, we know the default is, hey. We got a good group of people that love what we're doing. Got [06:26] >> a customer base that's hooked on our product innovation. That's the default. Great. So now we can use that foundation and look to more and more ways that we can innovate. And for me, I'm like, if a fundraising opportunity emerges not out of need, kinda what you were saying, like, you're just for the founders getting rid of it. Like, we're finally in a place where we can like we're coming up on fundraising for opportunity versus for need, [06:51] >> and I think that's, you know, extremely exciting. [06:54] 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 [07:17] 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 [07:41] 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 [08:03] 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 [08:29] 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 [08:51] 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 hoveroverproducts, 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 the interview. [09:18] You've managed dilution to the extent where you still own a nice chunk of business. I call it 30 to 50%. Right? Something like that? [09:25] >> Yeah. I own a nice chunk. And you're back to your question, like, how do I think about it? Like, it would be great to own a greater percentage of prism, but this is I'm this is the furthest I've taken a company. I I I own an asset that grows directly with how much I succeed. I'm in complete control of my most valuable asset. It's more than [09:43] And no co founders. [09:44] >> What's that? [09:46] No co founders. [09:48] >> I had co founders along the way that we've parted ways with and, you know, mostly all in good good good grace. You have to spend money. You have to [09:56] >> spend money to part ways? [09:57] You have to buy them out? Or how'd that work? [09:59] >> A little bit of it it depends on the story. A couple we spent money on. Yeah. I get a couple of it was more, cordial, and we and they and they bought their equity. So yeah. [10:09] Okay. Okay. Cool. Alright. Very cool. Talk to me about how you've grown. You've gone from 240 these are event venues buying your technology. Correct? Not the artists? [10:18] >> Well, we have the we now have event venues in the artist businesses as well using prism. [10:23] Tell me about that. [10:25] >> Yeah. So it like, the overall pitch of prism is, you know, the the live music industry is this, like, connected ecosystem of of people that are doing business to make concerts happen. You have the venues and the promoters who are putting on the events, and then you have talent agencies who represent the artists, and they're and they're booking these and they're they're essentially, like, selling the bands to these venues and promoters. So we work with both [10:51] >> sides of the ecosystem and that mostly helps with data transfer, long story short. If a promoter and a venue is both using prism, there's a really enhanced efficient show that gets planned. But if they're not using prism, then they have to do an amazing amount of data entry. So we've created this network effect kind of gravity in using the system where you if you work with three people who are using prism, it's this enhanced benefit. And [11:19] >> then you go and work with someone who's not using prism. It's not that you don't want to do business with them, but it's like you tangibly notice like, Hey, I'm just more efficient as a business when I work with someone that's using the same network as me. So that's a big part of our strategy. [11:31] Have you increased pricing or is each customer still paying about $600 a month? [11:36] >> We we have increased pricing quite a bit. I mean, our our, like, month our current month ACV is obviously quite different than if you look at all of our 300 customers because we have a lot of people that were paying a $100 in the early days. But to date to date, we're getting an ACV, like, above 11,000. [11:54] Okay. Okay. Very cool. And just to to round out revenue growth, so one year ago when you came on the show, you were doing about 155,000 a month in revenue across 240 customers. Where are you today? [12:04] >> Well, I can't disclose exactly what our revenue amount is at, but we're, you know, growing ACV strong, and we're above 300 customers now. So [12:12] Okay. Why can't you've always shared when you come on in the past. You said that you were up six x since the recession. You when you came on during the recession or the COVID, you said you're doing about 56,000 across a 120 customers. So can we assume you're 6 x $50 a month? [12:26] >> Yeah. You could assume that. [12:29] Sorry. Those are numbers you gave me. I don't wanna make a false assumption. Are the numbers you gave me accurate? [12:34] >> Yeah. There's just some strategic things happening right now that I can't, like, publicly be super clear about the numbers, but, you know, growth is heading in the right direction. [12:42] Are you selling the company? [12:44] >> No. Not yet. [12:45] How much are you targeting in the fundraise? [12:52] >> We're we're looking to raise you're so funny. We're looking to raise, like, a little bit of money, basically. Like, back to the whole profitability conversation, we're we're in a place where we don't have to I'm I'm I'm not selling a big chunk of the company. We're, like, kinda bridging our way to profitability, though. [13:08] Well, listen. If I read in the news that prism does a $30,000,000 series b, in my head, I just want you to know I'm gonna hope that on the backside, you reserve 80% of that as secondary for yourself. Let's just put it that way. [13:20] >> No. I appreciate it. I this is not what this next round is about. Like, during We- We had- You're gonna like this. We had opportunities to raise a larger round of funding and we intentionally were like, Hey, let's dilute less right now. We don't actually need it. And there's a question about, oh, could we turn that to secondary? Like, frankly, like, I don't feel like I'm quite at the place where I'm I'm doing that. [13:44] So, you know, I'm I'm really because you're choosing to I mean, have you asked for it and folks said no, and you you just feel like you don't have the leverage to get it right now? [13:52] >> No. Right now, I'm more focused on growing the business. Yeah. Like, I think like, for me, there's a clear like, I'm I'm conserving the equity that I have and, you know, saving it for the future. And, you know, there's a clear like, I see a clear runway right now to get the company, you know, to $1,520,000,000 in recurring revenue, and it's just my own kinda calculations and willingness to hold on [14:17] >> to that. [14:18] Long will it take you to get to 15 run rate, you think? The the and be end of this year, or was it take end of next year? [14:24] >> End of next year. [14:25] Yeah. Yeah. That's aggressive. That's like goal. Can you do that with your [14:29] >> current that's curious is if we can if we can break into the payment space. That's that's, like, the new you know? Yeah. [14:35] Yeah. Well, what's the analysis? Mean, we have a lot of listeners that have SaaS that are thinking about, like, should I add embedded finance? So, like, when you're thinking about should we invest in developers to add a fintech product? And if so, what percent of the GMV can we take? Like, how are you modeling that? How are you thinking about it? [14:47] >> Well, I think every opportunity is different, but, you know, for us, there's a question of like, prism prism is I think we've kind of, like, earned the right to be involved in the payment because our customers yeah. The the payment that would be we would be getting in front of is the the payment of the venue to the band. And prism of that do [15:07] you already sit on? Do you know how much of that you've processed the past year? [15:11] >> Well okay. So the keyword is process. If we were if we had the full network utilizing payments, it's over $800,000,000 flowing [15:18] through twelve months? [15:20] >> Yes. Yes. That's the projection for this twelve months for 2023. [15:24] But what was last? Like, if you look at historically million. Okay. Yeah. So what your your analysis is, man, if we actually facilitated the payment with investing engineering to do the payment rails and stuff, and you guys kept 2% to 500,000,000, that number gets big pretty quick. [15:35] >> Yeah. Like, the the the long of what I was trying to say is, like, do we have the, you know, the right to be the one that, you know, that that does facilitate that payment? And I think what we've done on the SaaS front has given us [15:46] >> a right the right? [15:47] I don't know what you [15:48] >> mean by that. Like, what like, can can someone just come in tomorrow and say, hey. We wanna invent a technology for like, a payment solution for the industry. And what I'm saying is we have a more of a right to do that than someone who comes in tomorrow because we're already helping these people organize their payments and doing a payment ledger and doing the contracting around the payments. Yeah. [16:08] Well, how are they doing [16:10] the payments right now? Like, do they put it through bill.com or something? Who are you competing with? [16:13] >> They they contract it in prism. They schedule it in prism. They track it in prism, but then they go into their bank account and actually facilitate it. [16:22] It feels like a very natural thing for you to do. Right? I [16:25] >> mean That's what I'm saying. That's what I mean by have we earned the right. Yeah. Yeah. [16:27] Yeah. So what what take rate do you think if you process 800,000,000 in next twelve months, do you think you can take a 2%, a 5%, a 20% cut? [16:36] >> Absolutely not on the 20%. I mean, so this is this is this is what we've learned is you have to ask yourself what what propensity the market has? Like, what are they used to? So for prism, like, are we offering? Like, In exchange for efficiency and better organization, [16:55] >> okay, but what are they doing instead? Right now they're sending ACH and wires, and that's anywhere from free or $20 a month to $20 a payment. So we wouldn't have the immediate opportunity to take like 5% of a payment to an artist. Like, people would be like, alright, no, I'm just gonna I'm gonna I'm gonna save a little of efficiency and [17:15] go into my bank. [17:16] >> It's not worth $5,000 [17:17] >> a month. [17:18] What about 22% of 500,000,000 is $10,000,000 in revenue for you. [17:21] >> This is this is what I'm getting at. So for us, it's like there the question is is, like, how you know, there's a direct revenue stream even if it's not 10% or 5%. And the strategic moat of being the payment facilitator and getting people, in love with that solution of not having to work with their bank account every single time and having to be more organized and streamlined, that's what's exciting. But yeah. But there is a [17:44] >> transactional opportunity as well. The other question is, how much is that 800,000,000, you know, chopped up? If you think of a POS system at a bar, that's like a bunch of $5 to $10 payments. So for them to take 5%, it's like, whatever, let's call it a 0.25 to a dollar. So that's- It's really easy for payments companies to take a bigger cut of a smaller transaction than a smaller cut of a bigger transaction, depending on [18:12] >> the market. So that's something that we're working through right now. But still, there's there's there's enough payments for it to be a very exciting opportunity for us. [18:20] Yep. And what's the team size today? How many full time? [18:22] >> We are at 20 sorry. I'm, like, I'm trying to think. 27. Yeah. [18:29] 27. And and are you still using sort of an outsourced engineering team, is that all in house at this point? [18:34] >> No. We've never had outsourced engineering. We've always been in house. [18:37] Oh, okay. How many engineers? [18:40] >> We have of that 27, I believe, 17. [18:43] Are you built are all in in Austin, or are they spread out? [18:46] >> We're a little bit spread out. Our core team is in Austin, and we have a few people in Detroit. And then we have some international engineers that are, like, full time employees. It's not like a dev shop situation. [18:58] Very cool. Very cool. Well, we're rooting for you, man. Congrats on the growth. Let's wrap up here with the the famous five. Number one, your favorite book. [19:05] >> My favorite book of all time. Let's just go with The Alchemist. That's a good book. [19:09] Yeah. Your last one was The Da Vinci Bio. I'm sensing a trend here. [19:13] >> Alright. That was really good. You have that. [19:15] And number two, is there [19:17] is there a CEO you're following or studying? Last time you said Grimes, so you gotta pick somebody new. [19:21] >> I said Grimes. I that's probably just the podcast that I listened to. I thought I I I'm super happy for Sam Altman and what OpenAI has cracked open. Like, I think I'm not as like, I'm not going for the roller coaster ride that everyone is with how like, I think there's an amazing amount of noise in the in the signal of what AI is, but OpenAI has clearly, like, done something very important and interesting, and we'll [19:47] >> see where it goes in the future. But if if it doesn't go anywhere besides what it's already done, it's extremely impressive. [19:52] Number three, what's your favorite online tool for building prism? [19:57] >> My favorite online tool [20:03] >> lately, I've been doing a lot of marketing myself and using Camtasia, which is like a a way to, like, chop up, like like, live recordings of [20:10] >> the app. School, man. [20:11] Camtasia's old school. [20:12] >> Wow. Okay. Number four. [20:13] How many hours of sleep do you get every night? [20:16] >> I get I try to get nine. [20:20] That's good. And still not married, one kid. What? You're 34 now. Is that right? [20:25] >> Yeah. Yeah. Yeah. I I'm in a in a relationship, not married yet, but that that could change in the future. [20:32] Any more kids or still [20:33] >> I don't wanna divulge anything on the podcast that I can't divulge, but there's there's things there's things happening with the company, and there's also things happening with my personal life. [20:41] That's very exciting. Still one kiddo, or you have more at this point? [20:46] >> Just just one for now. But once again, you know, it's just [20:49] >> been miping away. You know, you you don't wanna break baby news on the podcast. That's for sure. We want family first. Family first. [20:56] Alright. And, Matt, how old how old are you? [20:58] >> 34? [20:59] >> Yeah. You had it right. 34. [21:01] Yep. Alright. Take us home here. [21:02] >> Something wish knew same age. [21:03] >> So yeah. Know. It's perfect. [21:04] Take us home. Something you wish you knew when you were 20. [21:08] >> Something I wish you I was 20. I think just the importance of wherewithal and keep and and positive attitude and a willingness to persevere is is like the stimuli like, to maintain a good attitude and you know, through, like, challenging times, like, to, like, work that muscle and to understand it more and more. [21:31] Guys, prism.fm helps event venues organize with artists and collab on all kinds of show types. Obviously, took a hit during COVID. I thought Matt was gonna totally die, and he just had unbelievable willpower here. Got through it. Went to a low of, call it, $50.60 grand a month. Has now scaled much larger than that. Call it over a 150, $200 a month in revenue. 300 customers today. New customers paying on average $11,000 per year for the [21:55] platform as he looks to scale. Closed to 5,000,000 series a in 2021, potentially looking at now as well. We'll see what happens. But he says he's very close to profitability. Team of twenty seven looking to build more payments potential payments products for the same industry. Matt, thanks for taking us to the top. [22:10] >> Thank you so much. Appreciate it. [22:12] 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 [22:38] 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 [23:00] fundraise, a big sale, a big profitability statement or something 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 [23:22] up 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, but I do it so that we can all learn. We have to counter those people. [23:41] We gotta 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.

Introduction hey folks my guest today is matt ford he's an entrepreneur engineer creator artist spiritual being out of austin texas now building prism dot fm he helps make planning live music events easier matt you're ready to take us to the top absolutely thank you i was worried about you during coba there was no live music events happening how did you survive it there we actually we found the silver lining through the pandemic for sure um it's amazing to say that now in hindsight there was definitely a moment in the heart of it where it was hard to see the other side of it but our basic hypothesis the whole time was this was going to be a brief moment in time there was going to be a live music on industry on the other side of the pandemic and if we use this time extremely wisely we can come out on the other side extremely strong and i'm happy to say that that's what happened um we ended up emerging with twice as much revenue as we had we closed a series a so over 1.2 million then now an ar uh yes yeah yeah yeah or right around there we we were back then we're much higher now um i guess yeah when i the pandemic i i was actually counting was counting like march of 2022 is basically when i wrote the pandemic office being closed we've had some good growth since then as well yeah that's incredible now did you pivot the company or you still are doing software for live managing live events we did not pivot the company so um most of our customers we we use it to our advantage for sure i'll i'll share that but our core business we kept the same uh software as a service for the people putting on live music events the the big thing that we added during the pandemic was we brought on the other side of the live music marketplace so there's venues promoters and talent agents um and we added talent agents as a new business line during the pandemic um we're about six months into a beta we have around 20 customers and um and the customers are loving it we've identified a small list of things that we need to do to really sweep that side of the market and um and we're closing in our vision of being the ubiquitous solution for all sides of the live music marketplace so things things are frankly really really great so yeah so just be clear your talent agencies the event venues and the talent the bands themselves you're working with all three so so the talent agencies and the bands are one group um the town agency represents the ban and then there's the venue and the promoter so those are the three that we're working with and the banks do you make money on all three lines there yes yeah the same model on all of them it's like a percent or something or is one paying a sass fee one's a percent we have a basic sas fee we want to move into some more transaction based things but for the time being we've um yeah we're out of basic success we actually we just we did our pricing on the venue the promoter side of the company it's the most mature side of our product so we're getting to a place where i'm i'm really pleased and happy with um our pricing model what are they paying per month these days it's all over the board um our average comes in around 8k a month um but we have enterprise clients that are paying 250 000 a year um we have some legacy customers that are still paying two thousand a thousand dollars a year i mean one of the cool things that happened is when we launched prism we were getting beat up for a thousand dollars a year promoters were saying hey 1000 bucks a year let's get that down to 800 bucks a year 600 bucks a year it was only on pure faith that i kept running the business in that moment um but now we have a customer paying us over 250 000 a year and they're not alone um and that's a paradigm shift at the company so i mean we it's not like we've won the war um but you know that's very very encouraging to start to have people pay us real money for our service oh what's going on there youtube good to see you guys now imagine this you love watching these interviews with sas founders but imagine if we took all of the valuation data out from over 2807 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 founder path check this out i'll show you how you can access this in a second but you log in you connect your stripe account you see your valuation real time you can see what it changed over the past 88 days and even set goals for valuation this year now the secret evaluation is there's many different ways to value a sas business so the reason you're going to see three or four different valuations inside of your frowner path dashboard this is all free by the way is because depending on who's doing the buying of your sas company you're going to get a different valuation a vc is going to pay a different valuation private equity firm is different if you're going to 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 not built off random data again you guys hear these interviews on youtube all these datas are built from real-time valuation data points founders share with us on the show so traction 1.2 million seed round 3.7 raised they sold 22 percent of their business go in here and filter by the event maybe you only want to 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 going out right now and you're raising your seed round well 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 data set of sas valuations than what you can get now inside of founderpath and we're thrilled to bring it to you all right we're going to go back to the youtube video here in a second but if you want to check this tool out if you want to jump in and sign up you can check it out for free to get your valuation at this link this link founderpath.com forward slash products forward slash evaluations 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 all right let's jump back into the interview very few founders make that gap right going i mean we know it needs to happen at some point but very few do it much less when they're going through cobit with what you were doing like how did you have the confidence to with a straight face say no it's 250k per year that's the price and i'm not discounting it pay it or go somewhere else yeah it um that's there's a lot packed into that question with that particular client we they they launched a 100 million dollar initiative they raised 100 million dollars to um to buy music venues and to create a tremendous organization and very early on they got in touch with us they understood the value of software they've tried to build out their own systems and they know how much it costs it costs them so i think those were all very important factors we didn't have to convince them of of our value and the price has gone up multiple times on them and it's been rooted in software needs so we're to be clear they're not we're not they're not paying us as a consultant they're paying us fees yes fees and we've been able to get them up over time based off of uh the features that we're pumping out so you know for you know we get to a certain place where prism's running a big chunk of their operation and they're saying hey there's this other bucket of our business we're spending a lot of money on it um it would be really valuable for us if you could streamline it and then we and then we negotiate on the fees so through that process we've gotten it up up to 250 000 a year and and matt breakdown this for me that the revenue buckets of these three different folks you're selling to what percent of revenue comes from which group by far so venues and promoters it's a little bit hard to distinguish because they're a lot of promoters are also venue owners so it's really just two buckets it's promoters and venues and agents so and the vast majorities are our promoters and venues like more than 90 of your revenue yeah yeah oh wow okay and how many folks are paying over there how many questions the agency markets six months old so that's probably mostly why i see i see how many individual venues and promoters like Currently serving 240 customers customers do you have um somewhere around 240. wow okay 240 interesting that's great and you said on average they're paying like two grand a month um no on average it's 7k a year yes okay seven 7k a year 600 bucks a month something like that yeah can can i multiply that i mean can Monthly recurring revenue i take 600 bucks a month times 240 that puts you at 150 grand a month in revenue yeah that's that's the way the math works for political rigging reasons i won't confirm or deny that but that sounds yeah about right yeah why'd you decide your your funding history today you raised a million in 2017 i believe you Bootstrapped raised 2.2 million in 2019 are those both accurate and did you raise more the so 2019 was a bridge note that converted in 2022 um on a on like a 9 million dollar round yeah the 2.2 million converted in in from 2019 converted in 2022. yes it did yeah um well sorry august of 2021 yeah okay got it so you did around in 2021 where you raised how much yeah um in total the round was nine million including the two million that converted in or no yes yes okay so you raised seven million of new capital two million converted from 2019 and that's what you raised yeah yeah yeah i was actually closer to six and that two it was the the the 2019 round was 2.9 million and then there was interest on the note so yeah i see i see what interest pretty standard 68 percent we were 3.5 per year oh that's not that's really good that's great good negotiator it was good and it ended up working out in our favor because we had to hold on to the cash a little bit longer than expected because of the pandemic but yup yup no that makes a ton of sense and i mean can i ask are you comfortable sharing most books in their series they are selling you know what 10 to 15 of the business were you sort of in that range yeah yeah okay all right so you're like 60 million post money valuation something like that um we were less than that uh okay yeah okay this is really impressive because i i remember like when we back when we played katan that one time if you remember i just remember going man i love this guy's energy he's got a great product i hope he figures out how to make money during the pandemic so i'm glad you figured it out well thank you for your hopes and yeah we did and like i was saying i i have to remind myself that we slayed that dragon because it's so easy to just keep my head down and it's so impressive yeah it's super impressive how many folks today are on the team full time we and this is one of the things that i'm most excited about is we we've got a relatively lean team um i think it's 20 full-time um and we are in a place where we could i mean we could cut and be profitable Profits right now um but with the money that we have in the bank we have a really good shot at just just not raising again and going to profitability if that's what we choose so from a healthy place not from a place of like having to do really aggressive cuts or anything like that so we you really reinvented ourselves during the pandemic we grew revenue a lot but we also um set ourselves up to be a much you know better more profitable company in the future as well and it just it really has worked out in our favor yeah one of the ways to capture more value for any sas company is to sit really close to the payment stream of your customers help them get more payments and then take a percent fee there right so you haven't moved into the percent fee model yet but it sounds like you're thinking about it if you do move into that what will it look like yeah thank you for asking we we do yeah wow exactly you you just called out our playbook right there for sure um we help them track their payments we help them account for their payments we help them invoice their payments we're not actually facilitating it yet so that would be a really tremendous line of revenue for us if we get into it there's um i kind of always mess up this word but i think the right word is it's low elasticity in the market meaning they're extremely price sensitive so um sometimes a band might get paid a hundred thousand dollars up front if they're a big enough band or five hundred thousand dollars and we streamline the problem of like keeping track of a huge mess around payments but not a big enough problem to get like an ongoing five percent fee or something like that um our clients would just go around us if you will so we're trying to figure out if it boils down to a few basis points if it's just baked into their software subscription and it's really just this thing that like blocks you know locks in our ubiquity because we're also handling the payments and we get it back into fees so it's ongoing exploration but you know frankly it's a bit of a horizon project for us we're fully focused on what i would say like completing the initial mission and it'll never be complete but our eyes are set on being the ubiquitous software solution for the live music industry and i think in the next six months we're going to see that happen matt how much revenue do you send right now if you track all the revenue going through your system today how much is it annually right now if we tr if we oh like all in all the payments across yeah yeah everything you sit on top of all the payments it's in the billions yeah i don't want to give you too um specific of a number you said millions or b billions yeah yeah yeah i mean i mean so if you can figure that number out right you know one percent of a billion obviously it starts to get very interesting very quick absolutely yeah yeah interesting okay very cool heck of a story here let's wrap up with the famous five number one last book you read i'm reading leonardo da vinci's biography by walter isaacson and it's absolutely incredible and very inspiring and very interesting number two is there a ceo you're following or studying i give you the same answers not the book but the ceo one uh i'm still okay let me ask a different tell me an artist that you're really impressed by because they really think like a business ceo they're also they're not just talented artists they're also a really good business person that's a good question that's a good one this is this is the one that pops to mind i saw grimes on a podcast recently and i think she's super smart and interesting and a cool person and uh she kind of blew my mind uh yeah that works answer but yeah that works great podcast it was really good number three what's your favorite online tool for building prism we just subscribed to referral rock i'll give them a shout out um it's i wouldn't say it's my favorite yet because we're just getting it going but it's a crm for a referral program and i think it's really smart uh it's a great price point it's a good tool um yeah i'm excited that it's going to be a valuable thing for us all right fair enough referral rock number four how many hours i sleep to get every night and i get a referral price for referral rock so if anyone signs up there you go from me um how many hours of sleep hours of sleep yeah i go for seven to eight sleep is extremely important to me i'm a big believer of um of of doing the things sleep meditation exercise so that when i'm not so that i'm when i'm working i can get that time back because my energy is just really that good so i believe that health pays dividends and that's the model i follow i love that about you uh number four uh situation married single kiddos uh one kid single um yeah but i'm you know interested so he's still playing the drums or what my kid yeah i feel i feel like you showed me a picture of him generally drumset he is uh he is really into drawing right now he has submitted a bunch of ideas to legos and mattel for new toy ideas so i'm really cool with the introduction of his both like engineering and drawing is what he's into right now yeah i love that okay man how old are you uh 33 33 last question something you wish you knew when you were 20. thank you oh gosh that's a great question i wish i would have come prepared for about 13 years ago prioritize emotional health like your life and success depends on it because it probably does guys that's a good one prism dot fm launch in 2017. talk about emotional health this guy made it through the pandemic when he was selling software to live event venues there was no live music happening how did he survive not only did he survive he more than like tripled his revenue right called over 155 000 a month in revenue that's up from 2018 when i had him on he was doing 15 000 a month in revenue now working with over 240 customers his customers are mainly again these uh these event venues and promoters 90 of his revenue is there right now as big as customers pay over 250 000 per year he's thinking about can i get a transaction business model as well we sit on billions of dollars of transaction volume that these artists are getting paid and the venues are paying them and promoters are making and he's actively thinking about that so we'll see what happens prism.fm matt thanks for taking us to the top thank you so much appreciate it 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 1 pm central additionally remember these recorded founder interviews go live we release them here on youtube every day at 2 p.m 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 sas world whether it's an acquisition a big fundraise a big sale a big profitability statement or something 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 sas 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 for that at nathan lacka dot com forward slash slack in the meantime i'm hanging out with you here on youtube i'll be in the comments for the next 30 minutes feel free to let me know what you thought about this episode 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 but i do it so that we can all learn we have to counter those people we got to push them away click the thumbs up below to counter them and know that i appreciate your guys's support all right i'll be in the comments see ya