Sustainable Platform Revenue, Valuation & Funding (2024)

guys sustainableplatform.com he's selling his data to 30 fund managers that care about ESG data he takes this out of 22 000 company reports like Tesla sells it to him for four thousand bucks a month on average doing 95 000 a month today up from 70 000 a year ago launched in 2017 when he did just 2 500 in total revenue he's basically bootstrapped raised 500k last chunk of that was 100K out of 8 million post money evaluation uh profitable which is great with a team of six as he looks to scale open to double revenues from a million to two million in terms of AR this year hey folks my guest today is Mark andrich he's the founder of sustainable platform a SAS data provider dedicated to providing the most important sustainability data and risk metrics to help fund managers investors invest sustainably Mark has a PHD in engineering and privacy work as an analyst and Trader at Ewe World Fund in New York Market radio takes at the top yeah let's go Nathan thanks all right is there is there big money in ESG data uh cool there's um there's big money with the fund managers making money with ESG data all right explain explain to me what you're selling to them and how are they using what you're giving them okay so we're we're providing independent data on companies to help investors understand uh the environmental and social credentials of what they're investing in and how that relates to um to the performance metrics from a financial perspective as well so give me an example what's a company that you cover so uh let's say a company uh might be I don't know Tesla so yeah so for example but we have 22 000 companies on the platform so it's pretty much every globally Mr company almost so you know Tesla's making electric vehicles that's their I guess primary product and service we're looking at the product and service saying okay uh how clean and the how clean is the the product you're making for the environment and how good is it socially and then comparing that with whatever other company you want to look at and so what are the data endpoints you're providing to the investors is it is it you know tons of carbon released per year or what are the actual endpoints uh so it might be um uh let's say number of electric vehicles per year but the impact of that from an environmental point of view so so uh how much fossil fuels a company is producing um let's say how many [Music] um uh uh how do I describe it so you have um it's more the impact of the company's product and service rather than just the operational metrics so ESG tends to be let's say how much carbon emissions do I have uh you might be a let's say you might be a producer of something that is hurting people or harming the planet but maybe you're doing it in an efficient way ESG tends to give you a good Mark for that what's an example of that a good ESG mark But harmful uh so maybe um some types of weapons manufacturers let's say um I don't know a tobacco company so they might say they might you know produce their cigarettes year on year with lower emissions uh maybe they've got good Workforce policies I'll give you a good example um ESG tends to be a lot about disclosure and a lot about providing data um so you know I might disclose to you Nathan that I'm going to punch you in the face right and I might also um tell you I've got a policy to not punch you in the face now the impact is that I still punch you in the face even though I've got a great policy and a um and I guess uh um the impact is the same so what we're looking at is okay is is say Tesla providing a product that's helping people harming people how much they're helping people how much they're harming people and then how does that compare to the other car manufacturers for example so you know we had VW as high risk because it produced diesel cars 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 the 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 evaluation this year now the secret valuation is there's many different ways to value a SAS business so the reason you're going to see three or four different evaluations inside of your founder 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 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 raise they sold 22 percent of their business go in here and filter by the event maybe you only want to see companies that have sold the whole business well here are a bunch that have been acquired the valuation and the multiple maybe you're going out right now and you're raising your seed round well go in here and look at all this recent seed deals that went down what they raised what valuation they raised at and what percent that they sold there's never been a larger data set of SAS valuation 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 and Mark how are you I mean any company that's providing data you've gotta you're either structuring data better than somebody else you have a data source nobody else has or you're massaging the data some other way that others can't do themselves what is your moat yeah so we we take companies publicly available information um so you know the annual reports and their websites and things like that and what we do is we actually translate that information we take out the text but we put it through a sustainability lens so it's really the lens on a company's data that then allows us to create the risk metrics and why can't somebody else do that though I mean why can't someone else build something to parse an annual transcript and get the same thing you're getting uh I mean someone can do but they'll come up with different metrics and I won't be as as critical um or as easily uh helpful for fund managers so your IP are the math formulas you run against data points you pull out of annual reports where you know this is what the fund managers care about in terms of ESG rankings yeah we know it cares about we also have tested it for performance and risk so we can show you know five years of say time series data fund managers I see give me give us a taste of that what's what are two metrics fund managers really care about when it comes to ESG uh say fossil fuel exposure so how much a company's um uh spending or selling with fossil fuels um another one is say sdg contribution their sustainable development goal contribution because they want to see what type of sustainability impact they're making through un sdg lens I see and all right and then yeah so how do you make money right so what are fund managers paying on average for this data on an annual basis but on average they're paying about uh 4K a month okay and what do they get what do they get for that is a number of data endpoints is a number of companies you're covering is it all 22 000 companies yeah so they get access to all 22 000 companies they get access the risk metrics they get access to our knowledge base uh they get access to um our sdg contribution so our sustainability contribution charts that they can use in their reports uh and they can also show their institutional investors or um you know they're actually getting their own sustainability assessment done independently because what a lot of ESG fund managers or people do is they'll say oh look we're sustainable or we we've got these ESG credentials we're kind of like an independent uh I guess um umpire on are they or or are they not and we give them that data so they can test it themselves before they go to market but and Mark how many fund managers or how many customers do you have today so I've got about 30 uh 30 fund managers directly um indirectly because we've got some Partnerships there's there's a few hundred so four thousand times thirty you're doing about 120 000 bucks a month right now in Revenue yeah we did about 95k last month 95 okay and what what's that up from what was that exactly a year ago so a year ago it was about 70k seven zero or seven thousand no seven zero seven okay got it and when did you launch the business what year uh launched it uh 20 end of 2017. so we've been going quite a while okay do you remember what first year revenues were uh yeah about two and a half thousand how did you support yourself back in those early days uh I was I was doing a lot of uh Consulting work um in kind of a similar area but but uh more um well like Financial modeling and sustainability analysis it was Consulting work that paid for the business uh were you a fun did you have your own fund at one point how did you build empathy for your customers well I worked for a I work for a fund um it's a really really good question I work for a fund uh in New York in the early 2000s and I I love the idea of investing sustainably but the the term didn't really have any um meaning or I hadn't even heard of it back then um really I tried to invest sustainably myself with the ESG data that was available and with what companies reporting and it was just impossible so I built the I actually built them or helped um I got some software developers to build it but I built I built the um the models and the methodology by trying to invest sustainably myself in a way that um also enhanced performance how many full-time folks are on the team today uh full time there's um there's six six of you guys okay and are you the sole founder I I'm the sole founder yeah and bootstrapped are you brazed a little bit we raced a little bit we bootstrapped initially um uh but we've raised uh 500 000 over the past three to four years from friends family and and uh employees have put in a little bit as well when was the last round uh we about a year ago okay and how much did you raise then uh that was a hundred thousand from uh yeah and and how did you so was this like a rolling note you just left open or what was it what was the cap on the hundred thousand that you raised uh so around um it was around eight eight mil oh wow okay yeah uh what we uh what we've done is really um we've been very careful about who we've selected as well coming combination of us selecting with that sometimes they don't want us as well but basically um you know we've been very careful about who he chooses uh I guess um uh as investors but it's also you know we we also kind of would rather get customers than investors um and and so just sort of gone along like that yeah so when you look when you take all the dilution from the 500k you've raised what you still own more than what 85 90 of the company yeah that's right I understand okay just overnight yeah that's great and and I love obviously money from customers especially if you're also I mean are you also profitable yeah we've been profitable for three years now I love that are we talking like 10 grand a month in profits or like 100 Grand or you're basically like break even uh it's been kind of break even but only because we've been investing as much in the product development as the revenue allows us to yeah so what do you think you grow to this year you're at 1.1 million run rate right now what do you think you finish with well uh depends on a new on a new product launch so we'll be hoping to double it this year uh the revenue but we actually have a new product which is allowing people to purchase company level reports which we've done in the past so now any company so you don't any company or or person could actually purchase a single company report or how much commercially so that's going to be we've sold them in the past actually for 50 000 a year um but where we're actually um we've got them online at the moment for a non-commercial use um at around uh 2000 2 900. more than one report yeah yeah basically all the data on the on the one company yeah we'll see do you ever get approached by these funds to just just acquire you and if so if someone offered you I don't know eight million bucks all cash up front do you sell um look we we I guess we we talked to uh we talk to everybody um we haven't in the past done it um spoken to any funds like that um I guess we'll see what happens I mean we kind of part of our value proposition is that we're independent of the other fund managers and so you know we're actually able to give them I guess um really good independent information um but you know we'll see I mean it's a pretty kind of exciting area and it's been growing pretty fast um we've also we also arranged because of this podcast to to give a discount to your customers I don't know if we're allowed to do that but we've got to yeah give it to them now what do you got so it's it's Latka l-a-t-k-a 2023 uh for the company reports off our website and what's the URL where can they go to skip that sustainableplatform.com all right there we go guys if you're fun manager is listening in you want to understand ESG report sustainableplatform.com code is latke 2023. um very cool mark on that note let's wrap up here with the famous five number one favorite Business book the prize by Daniel number two is there a CEO you're following or studying no not really number three what's your favorite online tool for building the platform well I don't know if it's building it but LinkedIn for for finding customers that's fair number four how many hours of sleep do you get every night uh between three and ten what's your situation married single kids I actually I got a I got a new partner with uh with two kids and then I've got two kids myself but they are abducted to Russia uh by their mother and grandparents a couple of years ago so I try to call them every night so that's oh wow yeah that's a hack that's a heck of a story I want to dig deeper there but we're sort of out of time but for your four kiddos two of them in Russia basically yeah okay very cool and how old are you I'm 44. and if my kids are listening they need to they need to get hold of me there you go guys kids if you're listening this call your father okay all right last question last question mark what's something you wish you knew when you were 20. um I wish I knew that when you have when you're given two options you actually have four options so people say do you want a or b well you can actually choose neither or you can choose both I wish I'd I wish I'd thought of that and knowing that back then interesting guys sustainableplatform.com he's selling his data to 30 fund managers that care about ESG data he takes this out of 22 000 company reports like Tesla sells it to them for four thousand bucks a month on average doing 95 000 a month today up from seventy thousand a year ago launched in 2017 when you did just 2 500 in total revenue he's basically bootstrapped raised 500k last uh last chunk of that was 100K out of 8 million post money evaluation uh profitable which is great with a team of six as he looks to scale open to double revenues from a million to two million in terms of AR this year mark thanks for taking us to the top thanks Nathan one more thing before you go we have a brand new show every Thursday at 1pm Central it's called Shark Tank for SAS we call it deal or bust one founder comes on three hungry buyers they try and do a deal live and the founder shares back-end dashboards their expenses their revenue our poo CAC LTV you name it they share it and the buyers try and make a deal live it is fun to watch every Thursday 1 p.m Central additionally remember these recorded 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