How Reclaim.ai CEO Henry Shapiro grew Reclaim.ai to $2.1M revenue and 16K customers in 2024.

hey folks my guest today is henry shapiro he's the co-founder of reclaim.ai an intelligent calendar assisted assistant used by over six thousand companies across the globe before starting the company he led product and marketing teams at new relic for five years he's based out of portland oregon henry you're a ticket to the top yeah let's go all right so this is this is a super tough space you know x dot ai came on the scene a couple of years ago raised a boatload of money and then basically flash sold for and you know no one made any money basically on that deal recently countless very hot they're i think on your cap table as well what are you doing different in the space where you're seeing like extreme stickiness on your customer base that's a great question um so i think the the first thing is um and thanks for having me by the way of course uh the first thing is i think we we really you know when we started the company our our intention was not hey let's go out and build a better calendar or let's go out and build a better scheduling service um you know we you know we came out of uh obviously new relic and had experienced kind of the pain firsthand of being you know busy middle managers who were constantly just trying to grapple to get every last little bit of time that we could for our priorities and constantly running into that challenge of like the calendar sort of feeling like a debt you have to pay down every week instead of an actual reflection of the work you need to get done and so we we actually came at this problem being sort of dev and monitoring nerds not even thinking about the calendar initially we only were thinking about this problem of like how do you get people and teams focused on the right stuff and i think because we asked that question first instead of asking the question of like well the calendar sucks let's build a new calendar or scheduling sucks let's build a better scheduler um we really tried to hone in on like the workflows and automation that people need and we really leaned into the existing platforms uh like google calendar like calendly um uh instead and so i think part of what makes us sticky is we're not asking people to go out and adopt an entirely new calendar service or platform we're not going out and asking people to adopt in many cases even an entirely new like task manager we're acting as sort of a hub for intelligently scheduling the time that you need and keeping it flexible so that you're sort of able to accommodate other types of commitments um i think the other thing that's a little different about how we approach this space that kind of gets into some of the you know called the secret sauce of the product is um you know we recognize that time blocking was one of those things that like if it was just as easy as me going on my calendar sunday night and blocking out every single event and putting the word busy on it um there probably wouldn't be much software or much opportunity around this space there's kind of two problems that people run into when they try to block their timeout the first is that it's not adaptive so it doesn't sort of accommodate inbound conflicts the second and the one that we really try to address is it's just not realistic you know if you're the kind of person who has a really slammed calendar um you need to be available for meetings you need to be available for collaboration and actually if you block out your whole calendar you're probably creating even more work for yourself because now you've got like people pinging you on slack and saying hey there's no time on your calendar can i get a few minutes you know can you move this thing um and so what we do is we actually kind of act like a circuit breaker for your calendar where if you've got plenty of time you know during the week to get your stuff done we'll kind of look at that and we'll run simulations we run millions of simulations daily against calendars and basically try to figure out like are you running out of time to do this thing and if the answer is no we'll put the time down but the market is free in fact when you uh scheduled when we scheduled this meeting it overlapped with a habit that i had but that habit was marked as free and replying uh the habit was reviewing prs uh i spent a lot of time here uh reviewing pull requests and you know making sure that the team's staying on track and uh and so that gets moved to later in the afternoon and actually it got marked as busy i was just looking at my calendar because the claim was like hey you're running out of time to get this thing done so i just think we're a little bit more product makes sense to me just i want to get as much as we can here in the 15 minutes so the product makes total sense to me um take me a little bit into if people want to use this thing what's the average customer paying you per month to use the tech currently right now we're a free product um so we're yeah we're pre-monetization um we're being used as i mentioned across a little over 6 000 companies today meaning we have you know anywhere from you know several to dozens to hundreds of users inside of these companies and we're spreading pretty quickly so how do you think about like and first off do you have any need to put a pricing paywall or how long can you go without charging let me know how you burn your head count etc yeah we're we're in a good position in terms of um in terms of monetization you know we're basically i'd say a couple years away from the sort of the edge of the cliff and we're at a really good point in terms of product market fit and sort of the demand for the product um and so we've actually had a pricing page up on our site for two years um and we put pricing out there because we know that it's really hard for people to standardize on anything if they don't really know what to expect once the thing becomes you know uh a paid product so how does that work you have it up but you basically have a crosstalk it says free through 2021 and is this basically enabling you to drive urgency so people are like you're like sign up this year because we're going to charge soon not only that we have a referral program where you can refer people to reclaim and get future credit against paid reclaim and that's actually been a really successful program for us that's very interesting now you can only afford to do this though because you've raised capital right so talk to me about your funding story how much have you raised to date yeah we've raised uh 6.3 million um in total um we had a pretty unconventional path i'd say to fundraising we you know left new relic um we're sort of we we had been working on this concept for a little while what year was that by the way when did you launch 2019 we launched in 20 20 our first feature was january 2020 but we incorporated in june 2019 and we left the relic in april and so we were you know having a lot of discussions with investors kind of pre-product and we actually i wrote an article about it on on techcrunch if you're interested um but basically you know we kind of got to this place where the story alone um was not basically getting us to the terms that we really wanted to see into the investors that we really wanted to see and so we sort of took a step back and we said like look we're you know we're pretty incremental people by nature and we tend to sort of err on the side of shipping to learn and so we uh we ended up raising a very very small well relatively small chunk of money that was just basically enough for uh patrick and i my co-founder um to basically start building the product how much how much was that henry we raised about a half million on safes um and then we raised another million in safes um uh about six months after that that was so that was five million preceded yeah that that was essentially our pre-seed round yeah and the safe route was nice because it sort of you know kept uh it you know kept the process pretty light henry why'd you have to do that though i mean look i'm a big fan like obviously if you're gonna go to the vc route you've got to go hard on the bc route you can also stay bootstrapped and you'll go bootstrapped and have more freedom you know pay yourself in cash flow why did you you know most people are selling 20 of their business in the precede round like this imagine you guys probably did something similar right so why did you need this 1.5 million um well i mean first of all we needed to be able to you know hire our first uh patrick's a java engineer um i work a bit on the design and operations side of things but uh neither of us was a full stack developer and we knew that a big part of this was going to rely on you know the front-end user experience and so we brought on our first engineer with that money and our first couple full stack engineers with that money um you know other kinds of normal things it's nice to have health care um it's nice not to be you know super super stressed about you know the the the change in in pace um so you didn't leave new relic then with like a bunch of savings where you gave yourselves like a year of runway to experiment with a new product we did i mean we weren't paying ourselves uh very very good money i mean i would say we...