Interview
How Sentisis Reached About 200K a Month in Revenue and 80 Customers Serving Spanish-Language CX (Interview with CEO Jorge Peñalva Zambrano)
- Interview Date
- October 29, 2018
- Interviewee
- Jorge Peñalva ZambranoCEO
Company Metrics at Interview Time
Customers (2018)
80
ARPU (2018)
About 3,000 a month on average
Monthly Revenue (2018)
About 200,000 a month
Team Size (2018)
40
Total Funding (incl. debt)
2,000,000
Historical Snapshot
These numbers were reported by Jorge Peñalva Zambrano during the interview recorded in October 2018 and are a historical snapshot, not current figures. See Sentisis’s current numbers.
Key Takeaways
- 01Sentisis had 80 customers as of October 2018, each paying about 3,000 a month on average
- 02Average contract value was 30,000 to 50,000 a year on an annual subscription model
- 03The company grew at 40 to 50 percent per year at the time of the interview
- 04Revenue was about 200,000 a month at the time of the interview, up from about 130,000 a month a year earlier
- 05Gross churn was 10 to 15 percent per year by revenue or logo
- 0630 percent of revenue historically came from cross-selling or upselling existing customers
- 0760 percent of customers came from outbound cold calling and events; 30 to 40 percent from inbound content marketing
- 08Total capital raised, including debt, was 2,000,000, a portion of which came from Spanish government innovation and entrepreneur loan vehicles
- 09The team of 40 was split across Madrid, Malaga, Mexico, Colombia, and Chile
- 10Sentisis focused on the Spanish language, with NLP adapted to how Spanish differs between Spain, Colombia and Mexico
Company Metrics at Time of Interview
| Metric | Value | Source |
|---|---|---|
| Customers (2018) | 80 | Interview, Oct 2018 |
| ARPU (2018) | About 3,000 a month on average | Interview, Oct 2018 |
| Avg Contract Value (2018) | 30,000 to 50,000 a year | Interview, Oct 2018 |
| Contract Type | Annual subscription | Interview, Oct 2018 |
| Monthly Revenue (2018) | About 200,000 a month | Interview, Oct 2018 |
| Monthly Revenue, about a year earlier (2017) | About 130,000 a month | Interview, Oct 2018 |
| Annual Growth (2018) | About 40 to 50% a year | Interview, Oct 2018 |
| Gross Churn (2018) | About 10 to 15% a year | Interview, Oct 2018 |
| Revenue from Cross-sell / Upsell (2018) | 30% of revenue historically | Interview, Oct 2018 |
| Outbound Customer Acquisition Share (2018) | 60% of customers | Interview, Oct 2018 |
| Inbound Customer Acquisition Share (2018) | 30 to 40% of customers | Interview, Oct 2018 |
| Team Size (2018) | 40 | Interview, Oct 2018 |
| Total Funding (incl. debt) | 2,000,000 | Interview, Oct 2018 |
| Year Founded | 2012 | Interview, Oct 2018 |
Growth Breakdown
Revenue
At the time of the October 2018 interview, Sentisis was making about 200,000 a month in revenue, up from about 130,000 a month a year earlier. Jorge put growth at about 40 to 50 percent a year, and said one of the main strategies of the preceding years had been to grow with existing customers, who wanted the same Spanish-language analysis on other channels.
Customers
Sentisis had approximately 80 customers at the time of the interview, each on annual subscriptions averaging 30,000 to 50,000 a year. About 30 percent of revenue historically came from cross-selling or upselling existing customers as they expanded from social media analytics into broader customer experience channels.
Team
The team stood at 40 people. The technical team was based in Madrid and a small linguistics team in Malaga, while dedicated business teams operated in Mexico, Colombia, and Chile to serve those local markets.
Funding
Sentisis raised a total of 2,000,000 including debt, with a portion coming from Spanish government loan vehicles designed for innovation and young entrepreneurs. The structure was primarily term-based with an interest rate that increases as revenue grows.
Growth Strategy
Outbound Cold Outreach and Events
Approximately 60 percent of customers came from outbound efforts, including cold calling and attending events in each country where Sentisis operated. The company targeted large marketing and customer experience departments with significant data volumes.
Content Marketing and Inbound
Between 30 and 40 percent of customers came from inbound, as Sentisis built a brand in each of its countries over several years and did content marketing. Some prospects reached out through the website, after downloading content, or after one of its Mailchimp campaigns.
Cross-sell and Upsell of Existing Customers
Sentisis grew its revenue base by expanding existing customers from social media analytics into additional channels such as surveys and other customer touch points. Historically, 30 percent of revenue came from this expansion motion.
Spanish-Language NLP Specialization
Jorge described the main value as analysis adapted to the Spanish language: Sentisis built specific NLP for Spanish and its variations, because the language differs between Spain, Colombia and Mexico. Customers got their conversations categorized by the main problems in their industry, with the sentiment of each. Because that analysis was the value, customers who used it on social media wanted it for other channels too.
Multi-Country Local Presence
Sentisis established dedicated business teams in Mexico, Colombia, and Chile in addition to its teams in Madrid and Malaga. This local presence supported outbound sales and helped build brand recognition in each market over time.
Best Quotes
“So Sentisis basically is a SaaS platform where we analyze customer experience conversations, mostly in social media, but also in other channels like surveys or other customer touch points. And basically, focus on the Spanish language.”
“On average, it's about 3 ks a month.”
“So 30 to 50 ks contract a year.”
“We've most been growing in the last year's about 40, 50% a year.”
“So revenue churn, depending if you measure it, of course, by total revenue churn or logo churn, but we're about 10 to 15% a year.”
“So basically, we mostly do outbound marketing in terms of in the countries where we're present. So we're present in in Spain, we're present in Mexico, Colombia, Chile, and a little bit in Miami too.”
“About a year ago, we were about 130 ks approximately.”
“Probably so. My 20 year old self was very... With a very engineering mindset, and I would probably tell him to care more about people rather than numbers.”
What Happened Next
At the time of this October 2018 interview, Sentisis had about 80 customers, a team of 40 and revenue of about 200,000 a month, up from about 130,000 a month a year earlier. It was growing at about 40 to 50 percent a year and had raised 2,000,000 in total, including debt. This page reflects the company as it stood at that moment. Visit the Sentisis company profile for current figures.
View Sentisis’s current profile and metricsFull Transcript
Chapters
- 0:00Introduction and Company Overview
- 0:22What Sentisis Does and How It Makes Money
- 0:41Pricing and Contract Structure
- 0:52Product Value Proposition and Spanish NLP
- 1:30Founding Year and Capital Raised
- 2:39Customer Count and Revenue Discussion
- 3:12Growth Rate and Revenue Expansion
- 4:03Churn and Net Revenue Retention
- 5:02Customer Acquisition Channels
- 6:33Team Size and Geographic Footprint
- 7:01Famous Five: Favorite Business Book
- 7:29Favorite Online Tool
- 8:03Advice to Younger Self
Introduction and Company Overview
Nathan Latka
00:00Hello everyone. My guest today is Jorge Peñalva. He's an electrical and computer engineer with a master's in CS in IIT. Started Sentisis, his current company, as CEO in 2012, the leading service for customer experience in the Spanish language. Working with clients in Europe, North America, South America, and Asia, he's looking to expand. Jorge, are you ready to take us to the top?
Jorge Peñalva Zambrano
00:21Yeah, sure.
What Sentisis Does and How It Makes Money
Nathan Latka
00:22Okay. What is Sentisis and how do you make money?
Jorge Peñalva Zambrano
00:25Yeah. So Sentisis basically is a SaaS platform where we analyze customer experience conversations, mostly in social media, but also in other channels like surveys or other customer touch points. And basically, focus on the Spanish language.
Pricing and Contract Structure
Nathan Latka
00:41And what does the average customer kind of pay for this, would you say?
Jorge Peñalva Zambrano
00:45On average, it's about 3 ks a month.
Nathan Latka
00:48Okay.
Jorge Peñalva Zambrano
00:49So 30 to 50 ks contract a year.
Product Value Proposition and Spanish NLP
Nathan Latka
00:52And what are they getting for this?
Jorge Peñalva Zambrano
00:55So basically it's a platform where, as a base, like the base customer can monitor, their conversations in social media and other channels. And our main value is that the analysis is adapted for the Spanish language, so we have a specific NLP for the Spanish language and it's different variations. So in Spain, Colombia, Mexico, Spanish language is different. So they get their information categorized in the main problems about their industry and the sentiment of those conversations.
Founding Year and Capital Raised
Nathan Latka
01:30That's great. And then when'd you launch the company? What year?
Jorge Peñalva Zambrano
01:33We launched in 2012, March 2012.
Nathan Latka
01:352012, very good. And bootstrapped or have you raised capital?
Jorge Peñalva Zambrano
01:39We've raised capital, but not a big amount of it. So in total, including debt, we raised 2,000,000.
Nathan Latka
01:45Who... Which firm did you decide to work with for the debt?
Jorge Peñalva Zambrano
01:49So we work with... Actually, the Spanish government has a couple of debt vehicles, and one of them is for innovation and another one for young entrepreneurs.
Nathan Latka
01:58Is it revenue based financing where you pay back as a percent of revenue, or is it a term based loan with a fixed interest rate?
Jorge Peñalva Zambrano
02:06It's mixed, mostly a term based loan, but the interest rate gets a little bit higher if your revenue is very high.
Nathan Latka
02:16Interest rate is higher if your revenue is high?
Jorge Peñalva Zambrano
02:19Yeah, exactly.
Nathan Latka
02:20Why would your interest rate be higher if you have higher revenue? It wouldn't be higher if you were lower because there's more risk?
Jorge Peñalva Zambrano
02:25No, because they're kind of investing when there's a lot of risk and they try to make a little bit more money when the company is growing.
Nathan Latka
02:34Oh, interesting. Okay. So it's more like a grant structured as a term loan.
Jorge Peñalva Zambrano
02:38Yeah, exactly.
Customer Count and Revenue Discussion
Nathan Latka
02:39Yeah. Interesting. And what have you scaled to today in terms of total customers?
Jorge Peñalva Zambrano
02:43So at the moment we have about 80 customers.
Nathan Latka
02:46Eight zero?
Jorge Peñalva Zambrano
02:47Yeah. Approximately.
Nathan Latka
02:48Okay. Now can I take 80 times that $3,000 price point? You guys are doing about $240,000 a month right now in revenue?
Jorge Peñalva Zambrano
02:55Exactly. Yeah.
Nathan Latka
02:56Okay. That's great. And what were you at a year ago?
Jorge Peñalva Zambrano
02:58A little a little bit less than that. So about 200 ks a month.
Nathan Latka
03:03Okay, and what were you doing about a year ago?
Jorge Peñalva Zambrano
03:05About a year ago, we were about 130 ks approximately, up from there, 40 ks.
Nathan Latka
03:11Okay, so good growth.
Growth Rate and Revenue Expansion
Nathan Latka
03:12Where's
Jorge Peñalva Zambrano
03:12We've most been growing in the last year's about 40, 50% a year.
Nathan Latka
03:17Yeah. Where's most of that growth coming from? New customers or expanding current, you know, past customers?
Jorge Peñalva Zambrano
03:22That's a good point. So actually, one of the one of the, like, main strategies we focused in the past years was in the customers that we have that were already working with their social media data. We saw that as our value was on the analysis for the Spanish language, they wanted to analyze other channels. And that's how we grew from just being like a social media analytics or understanding, as we say it, because we understand the
03:50data platform to a customer experience platform. Right? So 30% of our revenue historically has come from cross selling or upselling current customers.
Churn and Net Revenue Retention
Nathan Latka
04:03What does revenue churn look like annually?
Jorge Peñalva Zambrano
04:06So revenue churn, depending if you measure it, of course, by total revenue churn or logo churn, but we're about 10 to 15% a year.
Nathan Latka
04:18Okay, 15% revenue churn per year. Is that right?
Jorge Peñalva Zambrano
04:22Yeah.
Nathan Latka
04:23And is that gross or net?
Jorge Peñalva Zambrano
04:26That's... Yeah. So...
Nathan Latka
04:30Have you added back expansion revenue?
Jorge Peñalva Zambrano
04:32No. No.
Nathan Latka
04:33Okay. When you add back expansion, how much expansion do you have?
Jorge Peñalva Zambrano
04:36Yeah. So about 15%. So I saying we make, like, 30% on expansion a year.
Nathan Latka
04:43So just to be clear, if you're losing 15% and then you're also expanding 15%, that means your net revenue retention is about a 100%.
Jorge Peñalva Zambrano
04:52Yeah, exactly. Yeah.
Nathan Latka
04:54Expansion makes up for all the lost revenue. Is that true?
Jorge Peñalva Zambrano
04:57Yeah, exactly. Yeah.
Nathan Latka
04:58That would mean net revenue retention is a 100%.
Jorge Peñalva Zambrano
05:01Exactly.
Nathan Latka
05:01Is that right?
Customer Acquisition Channels
Jorge Peñalva Zambrano
05:02Yeah.
Nathan Latka
05:02Okay. Very good. And walk me through how you're getting these customers. Where are you finding them?
Jorge Peñalva Zambrano
05:08So basically, we mostly do outbound marketing in terms of in the countries where we're present. So we're present in in Spain, we're present in Mexico, Colombia, Chile, and a little bit in Miami too. And basically, we're targeting big marketing departments and customer experience departments where they have a lot of data that they wanna analyze, or they wanna capture data from the Internet and analyze that data. Right? And another source, so that's about 60% of our customers
05:43come from outbound. Right? So cold calling and going to events. And about 30, 40% come from inbound as we've been building a brand over the past years in each of these countries, and we do content marketing. Some of them reach reach out to us on their website, download
06:03some of our content or reach out after one of our marketing campaigns through Mailchimp.
Nathan Latka
06:09Jorge, what... What's your... Just... Obviously, there's a bunch of different tactics here, but when you look at kind of your overall fully weighted CAC, what are you paying to acquire a customer?
Jorge Peñalva Zambrano
06:17So approximately, we're paying, depending on the biggest and smaller, between 3 and 5 to 6 k.
Nathan Latka
06:24Okay. So $5,000?
Jorge Peñalva Zambrano
06:25Yeah.
Nathan Latka
06:26Okay. And that's to get, call it, a 2,000 or $3,000 a month account. So payback period is two or three months?
Jorge Peñalva Zambrano
06:32Yeah. Exactly.
Nathan Latka
06:32Okay.
Team Size and Geographic Footprint
Nathan Latka
06:33That's good. And what's the team size today?
Jorge Peñalva Zambrano
06:36The team size is 40 people.
Nathan Latka
06:3840. And where's everyone based?
Jorge Peñalva Zambrano
06:41So all our technical team is in Madrid, in Spain. We also have a small team in Malaga with our linguist team, linguistic team. And also we have specific business teams in each of the countries where we're present. So we have a team in Mexico, we have a team in Colombia, and a team in Chile.
Famous Five: Favorite Business Book
Nathan Latka
07:01That's great. Very good. All right, let's wrap up here with the famous five. Number one, what's your favorite business book?
Jorge Peñalva Zambrano
07:06My favorite business book is probably Crossing the Chasm.
Nathan Latka
07:10Number
07:11two, is there a CEO you're following or studying right now?
Jorge Peñalva Zambrano
07:16Sorry, can you repeat the question?
Nathan Latka
07:18Is there a CEO you're following or studying right now?
Jorge Peñalva Zambrano
07:21A CEO? Oh, yeah. I love Jack Ma from Alibaba. He's actually now kind of retiring.
Nathan Latka
07:28Yep.
Favorite Online Tool
Nathan Latka
07:29Number three, what's your favorite online tool for building your company?
Jorge Peñalva Zambrano
07:33Favorite online tool for building my company is Intercom. There's... You get a lot of engagement before using the product and once the customer is already using it.
Nathan Latka
07:43And number four, how many hours of sleep do get every night?
Jorge Peñalva Zambrano
07:47Oh, that changes a lot, especially if I'm traveling, but probably between six and eight.
Nathan Latka
07:52Okay. And what's your situation, married, single, kiddos?
Jorge Peñalva Zambrano
07:55I'm single. I'm single. I'm 30 now.
Nathan Latka
07:59Okay.
08:00Not married, no kids. And you said you're 30?
Jorge Peñalva Zambrano
08:02Yeah.
Advice to Younger Self
Nathan Latka
08:03Last question.
08:04What do you wish your 20 year old self knew?
Jorge Peñalva Zambrano
08:11Probably so. My 20 year old self was very... With a very engineering mindset, and I would probably tell him to care more about people rather than numbers.
Nathan Latka
08:22Yep. Care more about people rather than rather than just the numbers. Again, launched Sentisis back in 2012. Today, 40 people building out, 80 customers paying 2,500 or $3,000 per month. So doing about $200,000 per month in revenue. That's up from a $130,000 a just about a year ago. Dollars 2,000,000 raised mainly or a chunk of that from the Spanish government. 15% revenue churn per year, but they're expanding by the same amount. Net revenue retention about 100
08:47year on year spending $5,000 to acquire a customer. Between a three and four month payback period. Jorge, thank you for taking us to the top.
Jorge Peñalva Zambrano
08:53Thank you so much for your time.