How SpaceBasic CEO Madhavi Shankar grew to $500.9K revenue and 70 customers in 2024.

hey folks my guest today is shankar she is building a very cool tool called spacebasic.com or spacebase.com digitizing student experience for universities all right are you ready to take us to the top yes all right so what is space basic doing are you selling to the university or the student so we are a b2b sas platform what we do at space basic is we digitize student you know campus housing communities all of the tasks that happen on day-to-day basis is completely digitized and you know what we do from that data that we collect from the day-to-day tasks is we go ahead and kind of um you know with our analytics turn that into useful information for universities and students very cool and we'll say happy diwali right that's that's all the noise in the background oh yes you can hear a lot of practice going off it's diwali here in india today i love that i love that okay very cool so got it so you're you're um i totally understand the use case here who's buying it though is it the owner of the real estate that's housing or the college themselves so it is a platform it's a b2b uh sas platform we sell directly to the universities or independent student housing communities so that's how and once they onboard that then they go ahead and enroll their uh student population onto the platform i see got it okay taking you to the backstory here like what are they paying you today to use the technology on average right so on an average it depends we charge between four to nine dollars um per student per year since it's still uh you know that's the basic version but like when we add the ai aspect of it it kind of customizes there's an enterprise pricing available as well but that's the you know average ballpark of how um you know university would pay us here in india and how many universe like when a university signs up how many students are usually signing up for when they're from their first test i mean it's got to be hundreds right right so you know at the moment we work with about 65 70 universities about 150 60 000 users in total um and that's our current uh you know user base uh we want to kind of um you know kind of go 7x or 10x that next year uh post uh you know the covet um situation but so far that's what we've been able to uh achieve in terms of user base and universities that we work with so just to be clear 70 paying universities and all of the students under those 70 add up to 160 000 all the users so we have users when i say users what i mean is students staff educators administrators their parents etc so all of our users in total come up to about 150 160 000 users how many paid seats do the seven universities currently have on the platform uh we charge for student per year um though we have different users using it at the moment we just charge the students and we're we are about around uh 55 to 60 000 students on the platform wow okay amazing so i mean can i take can i take sixty thousand times four bucks a seat i mean you're doing something like two hundred thousand dollars a month in revenue uh yes that's right a year that's amazing oh a year or a month oh yeah yeah i did yeah so yeah there's a conversion uh with the local currency so let's kind of turn that over uh it comes up to four to ten dollars or for tonight dollars uh a year okay well this is great so you're doing about 250 000 a year or about 20 000 per month right that's correct yes okay this is a great story take me back to when did you launch this when did you get your first customer so week uh you know a bit of a backstory is um i started my journey uh you know working for startups back when i was in sydney australia so i i joined a product company there one of the founding employees started really early kind of really um my love for startups began there and um you know learning from that in 2016 um i met with my current co-founder who's based out of the bay area kind of met casually then decided we want to start this uh back here in india because uh you know digitization in terms of just student life outside of e-learning was very minimal um so we kind of came back did a lot of due religions and what we thought what we saw was you know the student housing segment was completely unstructured very pen and paper driven and that's why we started space basic and um we kind of you know did a did a pilot run end of 2017 but we actually went live um you know with with the product in um quarter one end of quarter one in 2018 2018 got it so you've built and built and built those great have you bootstrapped the business or did you raise capital let's drop the business in 2020 we were cash flow break even and we raised uh you know uh our first round of funding uh you know a more of a angel round uh this year in may in may okay how much did you raise so if we raised a small amount we have not disclosed the uh the dollar amount for for the funding but we raised a really small uh amount just just so to build the technology platform and to kind of also uh scale up sales and marketing but we plan to raise about a million million and a half coming coming this year i want to know the first i want to know the first capital this is an important part to your story it's how you build your mvp you hire your first people i mean are we talking like a hundred thousand dollars raised or 200 something like that we're talking between 250k to a half a million dollars i see i see got it okay and what did the 250 000 enable you to do was it hires marketing something else yeah the key areas where you know why weirdest uh 250k to 500k was for marketing uh to get more feed on the street for sales as well as to invest in technology we really wanted to build out the ai part because we had all this data but you know we really wanted to turn that into valuable information um and that was one of the key kind of takeaways uh from um you know this year's learning as well and we plan to kind of now expand to the entire university population and not just the um not just the you know student housing segment so we've learned a lot process this year and you mentioned are you sorry you're raising now we're gonna raise next year next year so the plans to raise next year i see i see got it very cool okay so 250 to 500 thousand dollars rate on a pre-seed round um example you guys to grow make some highers what's the team size today how many people today we're about 15 on and off that's our total team size um but if we take in our advisors and all of our you know consultants we're a team of about 21 people how many just full time 15. oh the 15 is the full time got it how many of those are engineers so our engine we're about six engineers uh we have about um you know seven say sales marketing and the rest are customer support tell me more about the sales and marketing folks they can't go and sell student by student but i guess they can go sell university by university right right that's right so we sell directly to universities every university has an average uh ticket size of about uh 800 to 1200 students that's an average size so what we do is we do mostly raffle referral word of mouth works a lot and we've also you know kind of directly reached out to customers uh we've had some amount of inbound coming this year as well but it's been a very uh you know kind of a still figuring out phase for sales and marketing but we really want to expand and be aggressive about that um you know in in 2022. mm-hmm oh i love that now it sounds like again growth is nice you're doing about 20 000 a month in revenue today across 70 universities do you remember where you were exactly a year ago yes so we have grown about 35 in terms of new customer acquisition also you know here in india the kovitz second wave was kind of gave us like about four four and a half months of complete shutdown universities have started opening up now uh over the last uh one to two months but regardless of that we've still done about 30 35 of a new customer's sales and um i feel like um you know a lot of in terms of um existing student population it's not 200 capacity because of covet um but i i definitely see that um increasing um you know around now which is enrollment time uh october november december i see so last year at this time you were doing about thirteen fourteen thousand a month in revenue and you grew that thirty percent up to twenty thousand yeah uh-huh right so during covert pretty impressive yeah we actually broke even during covet i i was surprised myself that you know that kind of happened but we also pivoted a little bit so i think that really helped us achieve that tell me about the equity splits on the founding team did you guys split it equally or no um so we we have you know we have esops we have since uh you know uh we are two co-founders it's it's not spread equally but it's kind of split in a way where uh there's some for um you know uh investors future investors esops and the two founders how did you uh when people set up their first estop pool a lot of people don't even know what that means employee stock option pool it's basically equity for you to recruit talent in the future but everyone there's no real art or science to how you set that up how did you guys choose to step it up at the start i mean imagine you do that with the seed round and how big did you set aside ten percent five percent something else you cut out yeah we kind of ten percent um again you know with esops the thing is we want to kind of really we want uh you know employees who are really passionate about the product to or the company to really have that skin in the game and not just uh you know uh have a conversation in terms of salary and we've seen esops to be a great option and i've personally seen that work uh you know with my previous organization as well and i really wanted to bring that to space basic as well because i see uh you know that could be really helpful for people who are passionate about startups or at some point want to start their own later on i think it gives a lot of learning um so personally it was important to me and i wanted to bring it here no i think that's smart 10 there and then most founders sas space when they're doing their pre-cedar seed runs they're selling about 15 to 20 percent of the business were you guys in that same range no we were not we were more uh we were less than uh we were around five six percent or less yeah but uh you know uh again um it was a very as i said it was a very small round and um we want to kind of save up equity once we reach our major milestone so we get a better valuation when we raise the next round yeah i mean that raised you raised that 250 000 seed at a cap of like five million something like that five to six percent of the business that's that's pretty impressive actually thank you how are you able to do that you guys were pretty early they're still in revenue right but you know uh what we also have is not just revenue right we have the potential revenue our market size our team and all of those factors considering so more of a it was more of an age around which is you can look at it as a you know a bridge note or not even a bridge not what was the word um safe note uh you know so we wouldn't uh that that's what it was it was more of a you know earlies uh a safe note ground but we will convert that next year um you know a proper fundraising ground very cool how much are you targeting next year you think um you know we still you have to finalize on the math but i'm thinking maybe uh a million or so is what we're looking to raise at what a 10 20 million valuation [Music] um well you know it'll be good to get a 10 but we'll have to see yeah yeah very cool okay anything else we missed obviously folks can check out the company at spacebasic.com anything else in hobby no well thank you so much nathan it was great chatting with you yeah let's wrap up here quickly with the famous five number one favorite book um [Music] lean in number two is there a ceo you're following are studying yes i i actually kind of read recently um you know a book about elon musk and i also read a book about bill gates and how we founded microsoft so that was pretty interesting number three what's your favorite online tool for building space basic um you know i use a lot of tools but my favorite being canva uh super handy and apart from can values also use a a tool called pitch for my presentation so i've really gotten fond of that off late number four how many hours i sleep to get every night um more than i used to before but about six to seven these days okay and what's your situation but i'll be married single kids single all right no kids and how old are you if you don't mind me asking sure um i'm 31 31 last question something you wish you knew when you were 20. oh my gosh if i were 20 i wish i studied entrepreneurship as a course you know which was not even an option you know startup was not a buzzword when when i was studying so i wish i wish i had exposure to that i would have started off much sooner than i did guys space basic helps universities in india manage the student housing experience they had fourteen thousand dollars a month in revenue a year ago now doing twenty thousand dollars a month pretty impressive considering the second we have coveted in india shut down most these schools seven universities work with them they're now growing very quickly 250 000 raised in their pre-seed round sold five or six percent of business now looking to scale out to more students currently they have 60 000 students on the platform 160 000 users across those 70 universities madabe thanks for taking us to the top thank you so much for having me 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 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