How SmartSuite CEO Jon Darbyshire grew to $3M revenue and 400 customers in 2024.

founders what's going on you guys know i love in-person events and they are back the recording you're about to hear is from our most recent event where we had hundreds of founders come together share intimate details templates kpis okrs about their business and it was something special something special we'd love to meet you in person if you want to see the next live events we have coming up via our schedule the link will be down below in the description if you're listening on itunes check this out on youtube you'll see the links in the description or you can just google founder path or latka next event we'd love to see you in person in the meantime though enjoy this recording it's a good one so we're going to focus today really based on nathan's request on on kind of a journey and let me get this slide figure this out real quick here we go kind of a three-part story from being an operator building a company becoming a leader in the space selling that company kind of transitioning to an advisor investor where i then invested through either directly or through some venture groups and about 400 companies set on the boards of lots of companies beyonce got bored with that and wanted to move back into the operator space kind of with the next journey which is a pretty typical story for a lot of founders that are probably in this room that once you're an operator it's hard not to be an operator and i also found that i wasn't a great advisor i was an okay advisor but i always wanted to actually do the work and the founders don't like that like they want you to advise stay out of their business i wanted to actually get in and do some of the work that was there so to kind of kick things off we're going to start with the story of a company called archer technologies archer was a company that i founded in 2001 i'm going to share just some basics of the company with the products and the revenue to set the stage and then we'll jump into kind of lessons learned things that we did right and then things we didn't do so good that i would would have changed that's there so from a growth perspective uh what's interesting about archer was that we were profitable in the first year of doing business and i'll share with you how we did that in just a minute it was a very different market back in 2000 2001 there wasn't a lot of funding that was available 911 it just happened things began to kind of shut down so we really had to focus on we were bootstrapped as well through year eight we really had to focus on customers and revenue and how we could hire employees and you'll kind of see the growth rate here through the last year when we sold the company we're around 33 million excuse me in revenue as a company we focused on uh seven core products i'll share the idea in just a minute but the overall idea was to help manage security and compliance processes in the same way that a business would manage accounts payable accounts receivable hr those types of processes and organizations we had seven core solutions that we eventually had in the company each of those solutions were priced at fifty thousand dollars a pop an average customer for us was around four hundred grand with some add-ons uh that were there okay and i'll tell you the story and how we sold that in a minute which is interesting as well so here's kind of the basics of the story so my background prior to founding archer was i had the opportunity to build the global cyber security practice at ernst young and i had the chance to travel the world we had about 1500 consultants in that practice i meet with customers to understand how they're managing security in the organization mainly from an aspect of things were going online they had online stores online banking was coming on and they needed us to help them understand how do we secure those systems so that we can stay online so the opportunity was for archer was to take that service that we've been providing at ernst young and turn that back into a product that we could sell and manage as a process and organization the challenge that we had was that it hadn't been done before and as a small startup with the big idea how do you approach people with a new way of thinking about how to manage security and organization right at the same time archer was bootstrapped from day one um we didn't take funding until year eight which i'll share some of that in just a minute um from you so we didn't have a lot of capital i put in i think 750 000 to start the company to kind of get things kicked off the market focus for the organization uh started with financial services moved into telco moved into healthcare moved into technology at the end of the day i think we had 76 of the fortune 100 where customers after like the first six years of the company so mainly enterprise level accounts an average customer would have 80 to 100 000 users of our product inside of the organization renewal rates were pretty interesting over nine years 97.6 renewal rate so we only lost three customers in nine years two of those customers were because of acquisitions by another customer uh that had them one of those was lehman brothers that went out of business that was there so we found that things were very sticky that was there we sold the product as a sas offering but sas wasn't really around in 2001 so we approached eds which was our first customer with an idea and said hey we can come in and solve this problem for you we're going to treat it as a process and oh by the way you're going to pace the same amount of money every year and they said well how much money is that and i said eight hundred thousand dollars and they came back and said we'll pay you 1.1 million dollars and i'll share why they said that in just a minute so they became our very first customer before we ever wrote a line of code so i went to eds with a little three and a half inch diskette for those of you that remember diskettes had an html version that basically was a powerpoint that showed all the different screens on how things would would look and at the end of that presentation they stood up and said we need your product how soon could you have it developed if we move forward with you and i'm like oh my god like i don't have a developer we haven't written a line of code so i just shared it with them i was just up front and said hey here's where we're at it's an idea i've got everything documented we need to go build it it's there and i'll share a little bit more in just in a minute about that um the next thing that we did i told you in year eight um we raised capital for the first time uh in the organization not because we needed cash you saw from the prior screen that we were we had a pretty good cash flow in the business it allowed me to take some money off the table as a founder and it really opened up to stop thinking about money every day you know every day i would come in the office and the first thing i would look at is the bank balance just to make sure that we were in a good position to pay everybody that was on the team but it freed me from that and it allowed us to really grow the business in the last 9 months to 12 months after that investment from bain and if you go out into one of my breakout sessions after this i'm happy to share more information about what was so valuable with the bain relationship that we had and then what happened after the bain investment was that in year bain came in in year eight and about seven months later we were started getting approached by outside organizations about partnerships acquisitions we weren't planning on selling the company at that time but it just happened pretty quick so we went from bain came in and invested i think it was a 70 million dollar pre it allowed me to take some money off the table they bought about 20 of the company they allowed the employees to cash out a portion of their stock options at that time so it was it was kind of a good event for everybody looking back it wasn't a great event because then we sold the company for 200 million dollars nine months later that was in there which the employees would have kind of hung on to those options some of them so as nathan was saying when we when we found out that we needed to kind of start a process and people were looking at us bain capital came in and said look we need to hire an investment banker we need to create a deck we really need to go after this to make sure that we get the best price for the company you have an offer in hand but the minute that they know you have a deck an investment banker and that you hire the best of the best they're not going to retrade that value with you right it's only going to go up from that point forward so it allowed us to send this deck out not to the world we were pretty selective i think we sent it out to about seven organizations that we thought would have interest back in in this space three of them responded um only one of them was super serious and that was emc and they wanted to do the deal in four weeks in one month which was unheard of uh emc i don't know if if you emc has eventually sold to dell a couple of years ago but they had 43 000 employees i don't remember their revenue but we were their 51st acquisition so they were a company that grew by acquisition they had a team of 40 people on the acquisition team that that that's all they did was go from company to company analyzing um and then onboarding companies that were acquired uh by the organization so this deck this memorandum that we put together allowed us to get an offer for 187 million but what was key when when we got to the loi here is that we also got to keep the cash that was in the business so the deal was really north of 200 million because of that simple item and the way we got to that point and it's key for a lot of founders that i work with is understand how much working capital the business needs make sure that that is communicated in the memorandum so that you can negotiate through the loi with hey here's what i need and in this particular case the business generated enough free cash flow each month to more than pay for the business needs so it allowed us to sweep about 15 million additional money out of the company so let's focus on here's what we did right this is what i wanted to spend most of the time talking about and i'm getting old and it's hard to actually read the monitor in front of me with the with the items but the first thing that we did right at archer was we listened to the customer and what that really meant was the first year and a half of the business i spent my time not in the office i was at customer sites i was at eds watching them and learning how they would use a product like this inside of an organization of 80 000 people i thought i was a pretty big deal ceo of a company they put me in a phone closet that's where i said there was it had you know all the tech was in there i had my little chair in my desk and i couldn't even do meetings in there i had to walk out to meet with everybody but i just sat there and watched and listened to how they would use it i was on the phone back to our development team saying add this feature add this other feature that's in here and then i would quickly iterate back with the organization to say hey is this what you meant and we did that then with credit suisse first boston with lehman brothers with goldman sachs and that allowed us to really get the version one of our products to where it needed to be to sell to the remainder of the financial services companies the second thing that we did write was we really thought about who we were trying to sell to and for us it was the top 30 financial services companies in the u.s and the reason for that was that those companies if if we were in one of those companies it was easier for us to go to a tech company a telco company or a healthcare company and say goldman sachs is already using archer shouldn't you take a look at that right so we decided to focus just on those top 30 we broke it down into groups of 10 and we would only sell into those 10 one at a time so the sales team which was my wife would come back and say i've got this other opportunity i'm like is it in financial services is it one of those top 10 no forget about it people marketing team would come in and say hey we have an rfp forget about it we're only selling into these 10. and people were frustrated with me in the first year and a half two years but what happened was we sold 29 of those 30 companies and that's what launched us to sell to everybody else right was at the beginning we were very focused on on who we were selling to why we were selling to them and then it gave us the momentum to go to a microsoft and to a dell and to an ebay with some credentials to say hey here's you know city goldman lehman who's using the product with our products what i didn't mention at the beginning was that we were one of the first no code platforms ever developed back in 2000. anybody remember who the the first sometimes i call in the second no-code platform really was salesforce right before that there were things that were kind of in that space but that salesforce and archer were the first two products that really took a no code approach to solving a problem that related to a process so every customer could go in and configure that process just a little bit differently but it was one code base so across our 100 plus customers that we had every one of those were different none of them had the same ui look and feel branding but they were all on a single code base that was there so that was a huge advantage for us from a people perspective we found that the best people for us to recruit were coming from some of the big x accounting firms and the reason for that was that let's take accenture as an example when when somebody would come out of school and go to an accenture they would spend two to three months at a boot camp learning about process automation and how to serve clients and that whole process they kind of came out of that it's like a mini mba type program and if we could find those people in year three so they've kind of they've they've had time at customers they've been through the boot camp we could bring them in teach them our business those people just excelled and what i didn't mention about archer at the beginning was that we sold that company in 2009 but that company now does 700 million a year in recurring revenue 90 plus percent renewal rates going public this year i don't know i hear numbers anywhere between 5 and 12 billion but it's going to be a big it's a big number what's fun about that is a couple of those accenture people that are hired in year three now run the company not the ceo but they're the two two main folks that are there of the folks that we had in the company there's probably 50 people that have been there over 15 years now since we exited they stayed in continue to run all of them came from the ibm accenture deloitte kpmg kind of background that was there so the main theme there was understand who you want to hire and try to find people that are already trained to bring in you know back into your organization then if we go to the next slide talk a little bit about because there's a lot of people here building inside sales teams which is your third lesson learned here talk to us a little bit how you structure that inside sales team how many reps quota targets things like that sure so one of the lessons learned was that we should have done inside sales earlier bain capital came to us and said hey this is a growth engine you really need to get going we had four sales reps that made up the in the 2008 number that you see there we had seven sales rep that made up the 2009 number the 32 million that we had and i'm happy to share this kind of in the breakout in more detail but bain capital came to us and said hey here's seven portfolio companies that we have that use inside sales they use this process called the sales bus let's go visit them talk with the sales team leads understand how they're doing inside sales some of them were just getting started some of them were doing millions of dollars a month in revenue a sales bus includes seven people that's on a bus that has a leader and six people around the bus around the outside each person is organized based on their sales in the last month from seat one to seat six that's in there so everybody knows exactly where everybody else is at what we learned and what they taught me from that is that first off always try to hire a full bus if you can which is seven people but if you can't hire in threes the reason for that is the best sales people are competitive you hire two it's okay one could always be better than the other one and the other one's okay you hire three it's a little different dynamic that's in place i was deadly against inside sales to be honest at the beginning didn't think that they could sell enterprise software in the first months we had one of our inside sales reps sell an enterprise deal in germany over the phone there was no zoom any of that that was just over the phone sales call an average rep for us did a million two to a million five per year when emc came in they're a sales focused company those numbers doubled and in some cases tripled per sales rep like we had on our enterprise sales team we had reps that had quotas of six million a year that was their inside sales reps two and a half million but for us when we first got started uh a million and a half two other things that we learned very quickly that i wish i would have done different is that the global market's much much bigger than the u.s market so get your internationalization ready multiple languages on day one it's much harder to do that after the fact that's in place we spent way too much time and attention trying to get ready to go to market globally in year six and seven we should have just did that in year one that was there the second one is architecture matters we had the same problem we should have focused on our first feature should have been you know scalability and speed and we were focused on features first and that bit us in the butt in year six as we really started to grow and again it so we had to pause for about a year to kind of get to where we needed to be from an architecture perspective so john as you move into part two of your presentation you're being super humble so we're gonna change this to interview style is that okay right it's way easier trust me um so let's do interview style talk a little bit about why after you sold emc you decided to go into the advisor role you i mean did you know you're going to be bored doing this i did not and there's a couple things i i first off i thought i knew everything because we were pretty successful uh that was there which was i i learned very quickly probably in year four or five of that that there's a lot of different ways to do things and the way we did it was just one way i have friends that did it a very different way that were even more successful so what was the style you were taking equity in companies was it mainly b2b sas or how did you style the advisor shares you were going after was that part of your standard deal yeah so i invested either directly through companies mainly in sas companies that was there so i would take in a lot of cases i'd put in 250 was kind of the minimum number that we would put in and then i would take an advisor role or board seat inside of those companies i found pretty quickly that it wasn't good for me to be the only person in a deal that the companies that had other people like me or venture folks that were in the deal were more successful so then i kind of pivoted to more venture investing so i have about 11 venture companies that i work with that i've invested in their fun they invest back into companies and then they reach out to me when they feel that i have expertise in a particular area that can help the entrepreneur and that worked much better for us and then going to the smart switch story this was so fascinating because you ran emc you ran archer profitably you're growing like crazy did you guys see part of the bain deck already i think you already shared that right yeah incredible story so how does your brain now switch to think of okay i'm gonna do pre-revenue for three years i'm gonna spend 12.5 million bucks on mnp i'm going to hire over i think hundreds of contractors how did you get your brain in that space and why did it take so long and so much money in your opinion sure well let's talk about the idea first that was in place so you know as i've visited and work with these 400 venture companies that i had one of the first questions that comes up most of the time is what's the infrastructure that we need to have in place as an organization just to get started right we need sales and marketing and hr and i.t and customer success products to do things and i got really frustrated with always having that discussion and the idea from from smart suite was to transform the way businesses get work done by providing a single platform that could manage any workflow process or project in the company right so it's basically taking hundreds of point solutions that people have building that into a framework where all of that can be in one core platform so you don't need all these different sales tools marketing tools hr tools you just you've got one product that provides 90 to 95 of those capabilities right from the beginning so the lift was massive right it's a big idea we it we knew it was going to take about two years it actually took two and a half years of development time about 100 developers that we're just working night and day to kind of if we go to the next slide to kind of build out all these core capabilities in this platform that would make that a reality and once those those capabilities are done flip to the next slide well talk real quick you did something here also interesting i i joke that we're not far away from somebody launching a sas company and taking it public and they're the only employee you have remote.com you have these things you can just hire a bunch of contractors i'm just someone's going to do it one day um talk to me about why you went this route i mean you had what are the numbers you hired hundreds of contractors yeah so we basically we have no employees in place i have two co-founders we hired teams of people inside of companies i think we have five different main companies that we work with from a development perspective so we have a mobile team we have a web team we have names because people are on the computers what's the mobile team you used yeah so we use e-creative out of ukraine i'll talk about ukraine in just a minute we use gearheart out of ukraine and then we use a company called agency enterprise out of california that does a lot of work for spacex so they're kind of our high-end developers we way overpay for them but they're really really good come on what's the way overpay 12.5 million yeah they go for about 175 an hour uh for their for their core developers right um the ukrainian folks are typically in the 50 to 75 dollar an hour rate that's there similar quality but the u.s folks have a little more experience working with big data uh some of the more complex architecture issues that we need to solve so it's out now right over 200 workflows you've now launched talk to me about the building up to the launch six weeks ago okay so what i'm gonna do is on the count of three i want you guys each everyone just say how much monthly recurring revenue you think he's doing now sort of six weeks in after building for three years okay ready monthly recurring revenue ready one two three okay so the average is about 12.5 k across the sample size of 118 people uh are you comfortable sharing what mrr is today yeah i'll share the range so we're in the 85 to 90 uh k per month range uh right zero to a million bucks in a this is why mike you need to come in because i'm like i'm gonna grow this guy spend so much money on mep but now the way you've built your tentacles into so many distribution plan things pre-launch you launch you go from zero to a million dollar run rate in basically four and a half weeks is incredible so speak a little bit to the distribution tactics you set up pre-launch comparison sites things of this nature yeah so i think the first thing we did was we've automated the process to come in with a trial account so we make it super easy for someone to buy enterprise level software uh by clicking on your site and starting a trial it's ten dollars our base pricing starts at ten dollars per user per month and then all the way up to our enterprise is 35 dollars per month per user everything that we've done is organic so we reached out to a lot of the comparison sites and filled out surveys uh for them to do our requests for them to do reviews of our products just name a couple of those sites yeah we started with product hunt you know actually you know g2 cafeteria um just that whole group of sites where they actually do product reviews and let people come in and and view your product a lot of them as have signed up as affiliates through our affiliate program as well what's your kickback on the affiliate program so we've had um so far we're i think we're today we're like 325 affiliates that have signed up we offer them 50 commission of the first year revenue so that allows us to have a sales force that's kind of international from day one and then it ends 50 year one ends at the end of year one so basically we're we're overpaying for those customers in the first year but those customers we wouldn't have without those affiliates so i don't feel like we're overpaying we're breaking even but in year two we'll start making money on on the deals the affiliate springs how many of the 325 affiliates have earned at least a dollar already i don't have an exact number but i would say probably 35 there's a lot of them are have accounts that are in trial right now that will convert after 30 days and so the interface looks incredible uh right uh you can speak maybe a little bit to that here if you want um before we move into other takeaways and wrap up sure yeah so what we found when we when i started meeting with customers was that the biggest single thing that they needed from a work management platform was the user interface that focused on the people that actually do the work which are people ages 23 to 38 is what we found so we i sought after and tried to find a person or a team that could help me with the ui that had done something different that i'd never seen before and i happened to find a guy of all places in bulgaria in sofia bulgaria i went and met with him he's just interesting and different how do you find these people like what do you do on craigslist and it's like bulgaria you i just got online and used my network i looked at upwork fiverr like i just tried to find the top people and just looked at the style and the type of work that they'd done story had never worked in this industry before but he had that eye and that style that i liked that was there so i met with him we spent two or three days together we just hit it off i mean he's just a super great guy and he was just super excited and i said you need to leave all your other customers and you need to work with me a hundred 100 just me and after the first end of the first three days he said deal but you met him through fiverr or i met him through upwork yeah this is a this is also a tactic that i see over and over but very people will say it publicly but this is a great way to find great talent because you put up the same project so you have a design spec to 30 people on upwork you pay them all their rate you collect all the designs then you pick the best one i don't know i'd fly to bulgaria fly and meet them and then try and move them full time so he's now is he basically now full-time with you he is yeah his team so he's got a team of three or four people that work with him very reasonable rates for that team um and they got rid of everything else about a year and a half ago so they that's basically our design team anything else you want to add in before you take it home i'd just say we did the same thing on development side we found our our core people in all places of the ukraine i'd never been to ukraine before so i flew to kiev met with the first person that was there i still remember after about an hour i'm like oh my god i found the perfect person with the right team to actually build a product like this and i've been searching for like six months and found them there uh fast forward about six months after that i was searching for a mobile team well john hold on so obviously the sensitive you know there are things happening right now talk a little i mean how is your ukraine team doing or i mean i don't even know the right question to ask how are you thinking about those guys yeah i i wanted to mention that at the end it's they're in a difficult spot and you know they're people just like us they talk like us work like us i mean they're just normal people they wake up one day and they're getting bombed and we have people in cities that that don't have places to live anymore they don't have gas electric power they're cooking outside with fire they can't leave the cities that they're in it's just incredible some people we can't communicate with for two three days at a time until they get a mobile single to to just send a text to let us know that they're okay from a business perspective it's been challenging with the work that we're doing but we've kind of got that worked out in the last week or so so it hasn't affected us but there's about 60 people there that are just outstanding people that are are really struggling and there's a lot i mean when you look at all of the speakers and everyone's ft head count or full contractor head count about well about 35 40 of the speakers have team members in ukraine um i don't uh makita's not here but you'll hear from him tomorrow uh yeah i mean raise your hand if you've hired talent in ukraine and they're phenomenal right i mean look at that it's right phenomenal talent so obviously um sending the best you know thoughts prayers everything else the best thing i think we can do is just feature their stories talk about their talent and celebrate them and hope for the best exactly to be honest it's only going to get worse for them for a period of time so it's not going to get better anything you can do to support them you can go to our website smartsuite.com we have a little link at the bottom that...

Introduction hey folks my guest it is john darbyshire in 2021 his team launched smart suite the work management platform that manages any process from any industry on one platform in 2000 he founded archer technologies and enterprise governance risk and compliance software giving business users the ability to adapt software to their unique business requirements again smart suite today is the work management platform john you ready to take it to the top i am let's do it okay i have asked what on earth prompts you to jump into this space you've got monday that's now public trading at a ridiculous ratio throwing gobs of money at ppc you've got zeb evans at click up raising gob's money throwing money up to space what's your niche how do you win here yeah we're we're one level above those organizations our goal is to help organizations manage any process or project inside of a single platform but it has a more enterprise features than you'll find from a monday a click up and air table type so if you if you have workflows and you want to manage your business in a single platform we provide those capabilities that allow you to keep keep everything in a single platform when you say a process or a workflow i mean is this effectively like if you take mulesoft you know the enterprise version of zapier plus like you the enterprise version of click up and you put those two things together that's sort of where you're playing yeah i had a good analogy this week from a reporter that talked to me that said if you took uh hair table notion and click up and put them in a blender out came smart suite so we're taking the capabilities of those three different segments of products putting them together into a single platform i see okay so so those fo on those platforms you're talking rpoo's 20 30 40 bucks a seat i imagine you're more expensive and more in the enterprise what's the average company pay you per month to use the technology yep no our pricing model starts at ten dollars per user per month uh for our team edition moves to 25 for our professional and our enterprise is 35. the the really the vision of smart suite is to bring enterprise level features for work management to the masses at a price point that's not been seen before so we're really passionate about providing smbs with enterprise level features at a price point they can afford to be able to help grow their business so what i don't know how many seats the average customer has what does the average customer pay you per month yeah average every seats are 10 to 12 uh right now and it we're about 50 50 between um our team and our uh professional edition okay got it so 10 to 12 seats at 10 to 50 bucks a month do you have advert customers are paying like 200 300 bucks a month on average exactly something like that for 10 seats correct but we go all the way for our enterprise accounts we support all the way up to 5 000 seats per account do you have someone paying for 5000 seats already we're in discussions but we don't have a have someone paying currently well hey congrats that's extremely exciting nice work there what what's the largest number of seats on the platform right now in one company yeah about 150. okay i mean that's that's getting up there that's great yeah okay great no that we've only launched for four weeks so we've got a lot of stuff in the hopper we've had about you've only been selling for four weeks correct yeah we have about 400 accounts that are on the Currently serving 400 customers platform in the last four weeks 400 paying yeah exactly okay i mean how did you go from zero to 400 paying customers in four weeks you must build a big wait list or something no we well we we had a small wait list but we uh in the second week we just kind of started seeing what lots of volumes of customers coming to the website we have a free trial and then they can convert directly from the trial wait i mean how do they find you john this is incredible four weeks i mean am i doing this math correctly 400 if you have 400 customers paying average 250 Monthly recurring revenue bucks a month you went from zero to 100 grand a month in revenue in four weeks yeah so we're um we did a big push on linkedin uh which we had a pretty big network of folks that were there we were up on product hunt and then we started going to the comparison site so uh the majority of that is organic traffic that's coming back to us we just started our first paid search campaign for like 10 grand last month so everything's been primarily organic up until this point gone this isn't if i'm understanding you correctly you understand this is incredible what you've done um i think we're looking for bigger numbers but but yeah i think we're we're we're going out here my numbers are right right you're doing about 100 000 bucks a month today in revenue and five weeks ago you were doing nothing correct yes 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 to 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 founder path 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 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 i mean this is great okay i want to dive into this right so product on launch you have 251 upvotes about how many signups did you get from there i don't have the exact numbers in front of me but it's pretty small probably 2025 probably came from product hub with the um the discount code that we've provided oh those are actual paid signups came from product hunt uh correct okay do you know how do you have a free option how many freezers came from product do you know no we do not have a free option currently it's something that we're considering though interesting for someone else looking to launch on product today what should they give in terms of discount code so you charge 20 bucks a seat usually what discount you give product on users yeah we give them a 25 discount for the first three months and that worked it sounds like fairly nice let's go to the the next tactic you just mentioned linkedin when you say you pushed it on linkedin what does it actually mean yeah so we set up a company profile on linkedin and then we used our personal accounts i think between me and the co-founders we probably have about 8 000 connections that were there so we pushed back out into that community and then it's just been word of mouth interesting but what did you post on your personal profile hey like hey we're launching or what was the strategy there we do two or three posts per week that's been coming in so we first did the announcement that we're launching and then we started focusing on the types of things and ways we could help customers um kind of starting with project management and then showing the different categories of solutions that we can help people with yup yup okay and i see nine employees on the linkedin profile 213 followers is that right nine nine folks all the time um no it's a little deceiving so we have a little unique company here and that we're in nine different countries around the world we have about 110 people that are part of the company we have a lot of contractor and contractor firms that we've hired for specialty areas feeling that we do not need direct employees just to start a traditional company so obviously we've had about 90 developers working for almost three years to build a core platform that was released last month so the core of the company is on the development side and then we're just beginning to you know bring in sales marketing pr uh product support those types of folks i love the idea of keeping fixed expenses really low in the early years as you're building you sound like you've done that to a tee it's part of your blood tell me tell me i mean when you say 90 developers are you using firms like cody toss or sim form or what kind of outsourced dev shops are you using yeah so you know when we when we started smart suite we wanted to kind of find that development community that really understood what we were trying to accomplish and had some experience in that area of all places we found a great firm in kiev ukraine uh went over and visited with them never expecting to be outside of the us to be honest um met them and just walked away just blown away with the capabilities of the organization so they were kind of our core team that we brought on we probably have 35 people with that organization we did the same thing on the channel can i ask what that organization is they have a website yeah their name is gearheart it's gear here gear g-e-a-r heart dot io huh wow and and how did you know i mean it's you know picking up from beautiful california and going over to kiev to do diligence on this firm is a lot of your time and energy how did you know it was gonna be worth your time or energy like how did you find these guys of all places i found them on the internet just searching for uh development shops i probably looked at 50 or 60. um kind of and i started in the u.s i just couldn't find what i needed or people were too busy to to bring on a project like this so i turned it more international i looked on posted some stuff on upwork to try to get sources coming in so i probably narrowed it down to five folks and um i just kept coming back to this one gentleman um in kiev and i finally decided i just need to go spend two or three days with them get to know them get to know the people see if we had a connection and the connection was immediate like i i just enjoyed them as people and then technically they were as good or better than anyone i've worked with before this is amazing okay you mentioned you have over 100 firms you've sort of contracted with i imagine gearheart in terms of money spent is probably up there at the top right your dev shop it is so we have two other firms just like your heart so we have a mobile firm um that of all places was in uh the ukraine as well i met them in the u.s had no idea that they were based in the ukraine uh they came highly recommended from a a friend of mine um and then we have a third organization who are they do they have a website the second one yeah yeah it's ecreative.com and it's k with creative huh okay and who's the third the the third is um agency enterprise in venice california they um they do really high-end development work if they i'm not sure if i can say all the names that they work with but they work with the elon musk as asex and do some work there and that's how i kind of made the connection to them they're just um just an amazing group of very talented people so how do these all work together so so i mean is gearheart everything that's desktop e-creative is everything mobile and agency enterprise looks over everything or how do they function yep so um the mobile part is just eat creative we also have a team at e-creative that does web along with the agency enterprise team so we have three different development shops plus one of my co-founders as a cto uh the benefit that that gives us is we have ctos at each of those organizations and internally so the level of expertise that we kind of bring to the project is a lot a lot more enhanced than you would typically find in a startup environment and we do daily stand-ups with those for about an hour and a half each morning we go across each team individually and then twice a week we have all the teams together myself and the cto so a lot of coordination but it works well for us especially for the international folks we have meetings with them in the morning our time which is at night their time we wake up in the morning they've implemented all the stuff we talked about the day before or they had questions about and we move on to the next topic so it it allows our development to be very efficient it's incredible it's very incredible but just be clear there are only nine full-time people that manage all this coordination across all these contractors yes currently we've got and we're growing really fast we've got lots of opportunities for new folks to join i want to go to the comparison site strategy here in a second we talked about linkedin we talked about product we're going to save comparison sites here for a second you mentioned you've been building this for three years when did you guys write the first line of code for this uh it was three years ago in january yeah so 20 what 2019 or 18 19 2019. okay and you were basically at no revenue for three years dev shops and a hundred contracting is not cheap how did you fund the business yep i funded it myself we put in about 12 and a half million to date to kind of get to where we're at the thought process was we didn't want to be another startup company that that launched and said we have all these features that are coming and kind of bring on a typical mvp we felt like to compete in the space we needed to have a fully functional you know platform that had feature sets that our competitors didn't have so that's why we waited so long we're also very quiet we didn't update our linkedin profiles until last month we didn't tell anybody what we were doing until the announcement actually happened that's amazing okay now when you say you guys put in 12.5 is that you your personal money or all the co-founders together no that's that's my personal money okay i mean john everyone's gonna be wondering is this guy how to get so freaking rich right did you sell a company before this or what yeah i founded a company in the tech space called archer technologies we sold that to emc and then it got packaged up and sold to uh to dell it's a company that's just killing it they're going to go public this year i i don't know their exact numbers but i would imagine they're in the 600 650 million uh recurring revenue range per year right now where were they when you sold them to emc uh revenue-wise you mean yeah yeah we were at 40 million at that time and what year was that it was in 2010 2010 okay okay not that long ago okay and i mean can i ask you did the emc put out what was that which was the purchase price yeah it was 200 200 million okay so interesting and was that assault that's pure software yeah sas based software okay and you own the majority of that business more than fifty percent yeah yeah wow okay that makes sense okay now now the story sort of starts to come together um so so this is your second and by the way i always like founders you know you take one dip you take a second if you take a third did you hold on to some equity so when the dell sale happened you got another bite at the apple and we get another bite when they go public i i didn't in that particular instance it was an all-cash purchase price no stock which was great for us that allowed myself my wife and my mom which was the founder of that company to then start what we call the archer foundation which is a family foundation and we focused on entrepreneurial programs women's initiatives and youth programs wow and through that in our own personal investing we invested in about 400 companies over the last 10 years startups either through venture firms or direct um and really the genesis of smart suite was that when we would work with these companies one of the first questions that was asked is how do we manage all the processes internally to build the business that we need to build and we were always trying to cobble together all these different systems it typically was four to five different things they needed to do and and i got frustrated with that and finally just said we're just going to build what those organizations need to manage work in a single place and that's what kind of started this journey that's amazing okay so do you own 100 of the business today i do yes that's amazing okay so what i mean the question still here i'm trying to think if i was in your shoes and i sold something for 200 million bucks all cash and i had 100 million to play around with spending 10 percent of that or for three years i'd have to have a lot of conviction about that thing i'm spending 12.5 million bucks on what gave you this conviction was it just your own use case you needed this thing yeah i think it was my own use case but it was also um you know i built one of the first no-code platforms back in 2000 which was archer technologies the other big player in the space that started at the same time was salesforce.com with binion so i have experience in that space and what's changed over the years is the technology platforms now allow us to build the features that we really want to offer in a platform like this you can bring together you know the communication the collaboration the file management you know the spreadsheets the doc capabilities all into one place with a really rich ui so that people really don't have to to jump between tabs and go to other products to get stuff done they can really do the work in a single platform and that's where the conviction came from was how do we pull all of those elements together into a single platform but then it was also based on the ui in that the ui that we built is is built for people ages 23 to 38 who are who we feel actually does the work in an organization and obviously reports and dashboards and other things happen for people older than that but we spend a lot of time understanding that particular gender you know millennials and gen's ears how they like to work how they like to be social at work how they like facebook type components and sharing and collaboration built in so that's the audience specifically that we're we're going after yeah well you look like just before the interview my research team when you view the website you look like a tool that could be doing 50 60 100 million bucks a year in revenue so with the three years of investment to me it makes sense the story makes complete sense here now have you spent that full 12.5 million already over the past three years or if there's still some in the bank no that that's the i just funded each month as we need to fund it it's invested yep so all that's it's currently invested we'll be looking at a series a um here in the next month or two um but the intent was to put all the capital in to get us to the point where we needed so we could be very quiet about what we were doing well again this now why you went from zero to 1.2 million run rate in four weeks makes a lot of sense here so when you say you want to go out and look at a series a about how much do you want to try and raise and at what valuation you don't need to sell equity you're personally wealthy right so why do it no i think that the connections that would come through the venture community and the value add that they bring in certain areas is what we're looking for it's not just the cash it's the relationship that's there most likely to be a series of two to three venture firms that would be involved not just a single firm that was there on the raise side um we're all over this the place right now and how much we need to raise uh over the next uh you know 12 months to really get to an interesting uh series b and in some cases people are pitching us on just adding on to the series a i mean excuse me to the seed round that we've already done and positioning the series a you know when was the seed well the seed i considered the money that i built right yeah yeah now did you loan the business to 12.5 or is that an equity investment no that's equity investment okay interesting got it uh interesting so so do you don't have really a target do you have a valuation target you can get a 50 60 hundred million valuation we're in that hundred range is what we're we're talking about right now yeah it's hard because i mean there's a bunch of things you have that no one else has one is successful exit right so you can argue your sort of proven commodity the second is you know your money is where your mouth is at you put up you know a lot of your net worth into this thing and you went from zero to 100 grand very quickly so the question is how much growth can you keep driving over the next 12 months you know what i mean exactly yeah very cool okay well it'll be interesting to watch what happens talking about how you've done sales all know touch to date or how do you have a sales team uh we have just a small sales team so uh my wife tara who helped me fund our last company or found our last company archer technologies she jumped in about four weeks ago to kind of get the sales kicked off for us i don't know that she's here for the long term but she's kind of getting things going right now and what we found today is that a lot of our customers just want somebody to contact them have a quick conversation do a quick demo and she helps coordinate all that activity between me and the three there's three founders myself and two co-founders um but you just pay them a lot right they don't own any equity they uh each own yeah they each have a small piece oh okay like under five under five percent correct yeah okay got it so you own like ninety percent two co-founders own maybe another ten percent you didn't cut your wife terry in it all well she's in the 90's already yeah yeah he gets forty five percent of ninety right that's how that works yeah sixty percent of that 90 i think that's amazing talk to me real quick you mentioned comparison sites how are they working for you how which one's the most giving you the most leads per month uh you know capterra is is probably you know product did a pretty good job we just get a lot of bandwidth from them and i kind of consider them to be a comparison site um because people come in to just find out about new software and then look you know against the current players but you know the captains of the world are are where the real comparisons happen and we've really just kind of dived into that in the last couple of weeks um but it allows us to to show potential customers that are coming in that comparisons of how we compare against competitors even if the site's not sending us leads we can send our clients there to kind of understand are you paying for premium placement captain yet or no we are not we're not reversion on all those so we're on about nine sites today i think there's 30 that are on our list that we're trying to name john can you name a couple of those smart uh captain which other ones it's i've drawn a blankets the gartner based sites they're citing three of them that fall under gartner get out yeah yeah yep which other ones though just the gartner ones no i i just don't have that list in front of me and i'm i'm drawn up can i follow up with you can i follow you afterwards i can i can shoot that too as soon as we get done okay i'd love to see that yeah because these are great sites for leads and traffic if you can sort of play the game the right way the first step is driving a bunch of reviews you already have 23 on captain so if you want to move to paid on kept here eventually you'll be in a nice position to do that exactly fascinating okay um gosh you know you're the closest interview i've come i've done almost 3 200 of these where i'm looking for a founder that's going to take a company public with only one full-time employee because they use contractors you're like the closest version to that i've found so far yeah i think you know we were going down that model before coveted right we wanted to have more of an international company we didn't want the employees in one location i'm the only person under my wife that's based in newport beach california we're all remote and now that's not such a big deal but that was kind of the genesis of the company was let's find the best people wherever they're at worldwide and let's build the company around that as opposed to geographic location and 30 miles around that location for people to come to work each day so we expect to continue to grow our company kind of in this distributive model very cool john let's wrap up here with the famous five number one favorite business book oh um yeah i don't know if it's a business book but you know the bush family dynasty is just a great book that kind of teaches you about you know how that how that family was put together and it was planned what happened and it was planned that the you know the president or two presidents would come out of that journey but it talks about their financial background so i enjoyed that quite a bit number two is there a ceo you're following or studying you know steve jobs was was someone that i followed quite often and just the approach that he took to building apple which was different and i think about that quite often that he went against the grain of what was happening and built the company the way he thought it should be built to reach the customers that he wanted to reach and we're trying to take the same a very similar attack with smart suite number three what's your favorite online tool besides your own for building smart suite on my tool um you know we use intercom i don't know if you're familiar with intercom that much we we use the heck out of that product it's an amazing product number four john how many hours of sleep to get every night um i would say maybe seven okay and you're married to terry you guys have any kids we do we have uh two children's two kids okay and how old are you john uh 57 last question something you wishing you knew when you were 20 which i knew was 20. you know what don't don't rush success you know i think you're just chugging along and it's gonna happen but don't worry about it when you're that young guys there you have it smartsuite.com taking you know notion plus air table plus click up putting it in a blender and that's what you get they've gone from nothing to 100 000 bucks a month in revenue in four weeks the question is how did they do that you're gonna learn that in the interview they got going about three years ago john had a successful exit use that cash put in 12.5 million bucks of his own money into this new platform with a lot of contractors very very small fixed expenses in terms of full-time employees it's the model of the future i think watch out for these guys growing quickly potential series a coming up later this year we will see what happens again 250 or sorry 400 customers paying about 250 bucks a month right now on average as they get going john thanks for taking us to the top all right thank you 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 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