Tchop Revenue & Valuation (2024)

hello everybody my guest today is iko sharer he is addicted to moto mobile products and services after more than 15 years in different executive roles in media and entertainment product development for leading publishers and brands with his agency clap started and started tea chop as an uh mvp project about three years ago we're going to talk about teach up today aiko are you ready to take us to the top yeah yeah so i'll shall i give you a brief introduction yes so tell us about teach up what do you do and how do you make money yeah i mean we make money as a typically a software service platform so we provide enterprise agencies small teams with a platform that enables them to provide mobile communication services both content and live chat to customers employees so we cover a broad range of use cases so while you have a lot of platforms that focus on employee apps or intranet we have a mobile first focus and you can use it both for we have clients that use it for like 20 000 employees but we also have clients that use this for certain stakeholders for their management because in the end you know what we cover is like the main thing you know it's enterprise struggling providing high value content in a nice way with a good user experience to the mobile phones of their target group because that's a technically it's a pretty complex thing so we provide them with everything they need so just to be clear if there's a team of 100 people and and 50 you know five people on the marketing team and those five people have created powerpoint decks instagram images sample contracts all this stuff they can upload all that to teach up and use each other's stuff quickly exactly so we're very much based on the the idea of what we call integration which of course is very much inspired by the way slack is doing so you can very easily have an input api where you can automatically you can input rss feeds uh social media feeds all kinds of content automatically and just very easily create them so we are very much our ideas about the the idea of curation is not so much about recreating everything because we we believe most teams have all that content out there it's like it's all there in digital form with different sources and and platforms so it's very much about curating and integrating them but ico is this the internet i mean this is the internal tool teams use or they're actually using it they're publishing content to customers both you can use both we have clients that have an application that uh fosters free content without login but our main core focus is closed user groups but the thing is we are not like a full internet because we believe most of these internet platforms end up incredibly complex and bloated with features so we very much focus on a lean we are just like a lean layer where you can like implement all different kinds of feeds into a very nice user experience and it's very easy to to hook up and it's not covering all these things as an internet because most most of our clients already have something like an internet but it just sucks on mobile yeah i mean i use for this thing for our team it's a small marketing team i mean we just use google drive right so how you know we upload all this stuff there so how's how are you different well yeah we are not so much we are not very much focusing on news and content so not about like dealing you know if you're like or more like focusing on on files you know then you can there's nothing else you need and google drive you're also using that it's amazing but if it's about like let's say you want to follow all the different news feeds internal feeds things from different sources there's you know like it's a bit like you know feedly in the consumer market and feedly you can also aggregate all kinds of of sources but it's difficult to distribute it then in a professional way and in our case you can really combine these things in a very very easy and lean way so in a lot of cases we have like companies that have like a very mobile workforce and they are looking for something that lets them distribute uh up-to-date daily news you know about all different kinds of news to their workforce without limited uh resources you know with very very small resources because most other tools are very complex so you need a big team and a long time to implement it so it's very lean and and efficient and so give me give i don't want to talk about every single customer cohort but on average what do customers pay for the platform the platform yeah i know we have a very simple traditional you know whatever all the software service tools have we have a price per customer per price per invited user and usually it's somewhere between 50 cent and one euro depending upon the amount of users so if we have like we have customers that have like 15 20 000 uh employees so they pay roughly about let's say 10k euros per month so this is something there that's a very robust so what's an ico so just i don't want to go at the seat level but i don't want your biggest enterprise account on average when a company joins you is it like 10 like what's the average per month average i would say it's between two and five thousand so we uh we also have like the traditional mid-sized company which in we have lots of mid-size companies in europe and also especially in germany which is like you know like still uh uh driven by the owner two three thousand people not even having an i.t department but having a mobile workforce so i could just be clear that when a new logo joins you on average they might pay somewhere between 2000 2016. exactly something like that yeah something it starts with 1 000 minimum so if you're a small team and a small company we start with 1 000 euros per month but that includes really ios android uh apps in your style look and feel the back end so you don't need to do you don't need to do any it integration yeah one of the biggest arguments yeah i go i i totally i totally get the platform i want to focus on other things just for time's sake so put this on a timeline for me when did you launch the company we launched the company like around three years three and a half years ago based on an mvp project which we did really with our internal resources and then we started and then suddenly first clients came and so it really grew by like you know we haven't done any financing round completely bootstrapped this we were looking into financing around next year but you know like having some experience i believe the later you do the first round the better also how many customers have you scaled to today so we have like around 15 customers today one five yeah okay so so if they're paying the average you just gave me that puts you at about 35 000 united states dollars per month is that about right that's about our mri and what are you growing at so a year ago what were you at during mrr so a year ago we had like i would say 10 000 or something um so it's like it's like the thing is since we don't spend any marketing so it really goes through mouth to mouth at the moment since we're not we're not funded in the way that we're aggressively marketing but at the very moment we're relaunching our website introducing new features so in q4 this year we're looking into more aggressive marketing to have them all grow so if you do raise how much do you want to raise i think we we want to raise around a million in the first round um because in the end you know like the evaluation is very much depending on our business so um we hope you know to you get like the first round based on like it's at least 40 to 50 000 mrr monthly uh and so what about what valuation would you like to raise at an ideal world yeah that's an ideal world i think we we would definitely look into something between like six seven million so maybe raising one million on six million when you're doing 40 or 50 grand a month in revenue exactly something like that and i think we have a good clear cap table you know because as i said you know we haven't done any finance are you the sole owner do you have co-founders i have a co-founder yes um we are only two guys in the company and as i said have an agency so we are like quite a few people so we have a lot of resources and experiences with building apps and platforms for big customers since like seven years so uh as of because a lot of a lot of experience we're bringing in here sure and so tell me more about the kind of unit economics uh churn is obviously critical what's your turn today uh churn at the moment is very low i think it's it's like we just lost two customers uh smaller customers all the other customers still there so we see like uh in that business and it's hard to really you know have other platforms so once customers implemented the platform you know we're we haven't done you know we haven't seen big churn at all at the moment it's more like two logo churns out of 15 total customers there's actually a lot of churn but if the let's talk about the revenue churn because if they're small customers it doesn't matter so net net revenue what i'd like to know is over the past 12 months what's net revenue retention annually we lost 2 000 euros a month so it was really the smallest customers and how much and how much did you gain from those same like again net revenue retention annually yeah net uh you mean like in total or what we gained last year yeah so we're we're right now recording this in september right so if you go back to september of 2017 and you take all the customers that signed up in that month and then subtract out the ones of those that churned and then add back the revenue that you expanded those same customers what's net revenue retention i think it's like around of this whole year you mean no revenue net revenue retention measures kind of cohort basis right so it's basically a measure of is your expansion revenue greater than your churn revenue yeah no i was like i think uh our like the the revenue we gained was like five times higher like even in that month so but as i said the thing is like we have like a long uh sales cycling which is one of the key challenges we are having is we have like it's enterprise business you know we have just enterprises so sales cycles are you know between like four to six months at least in most customers bigger customers we even have longer sales cycles so it takes quite a while to ramp up which is one of the key challenges we're having so that is actually at the moment it's just gain traction so what's it what's the team size today how many people we're like 12 people at the moment okay and how many are focused on sales or marketing sales and marketing is like two persons now at the moment really completely focused we just but those persons just started one year ago so just to give you an idea in the first years we really invested a lot into the product you know just gaining very slowly and now more aggressively into the market and where is everybody based we are all based here in berlin but we also have developers in ukraine so we do near shoring because just doing development in berlin got very expensive very difficult we have a i think pretty interesting stack using react node but we more or less now like really growing developer base in ukraine we have two teams there and that works quite well are you measuring like cac and lifetime value yet or is it too early it's too early at the moment got it very good all right let's wrap up then with the famous five i go number one what's your favorite business book uh the hard things about heart you know like the latest one from ben horowitz i think it's the hardest thing about hot things yep number two is there a ceo you're following or studying um yeah ceo it's like uh of course i'm following uh andres and horobits and all these like you know andrews and horowitz gang so i really appreciate what they are saying really really interesting from founders perspective number three what's your favorite online tool for building your business besides your own leg number four how many hours of sleep to get every night i would say between five and six okay so not bad now what's your situation married single kids uh i'm uh you know i have a girlfriend but not married okay not married no kids no kids okay and how old are you i'm 43 43 last question what do you wish your 20 year old self knew uh yeah i mean passion never fails i would say guys passion never fails again launched the company back in uh let's see launched back in 2015 again teach up think of it like think of it like a google drive but add in like rss feeds it's not just files it's it's more than that so uh these teams are managing their things internally they've got a team of 12 people between berlin and other remote locations near shoring building the tool out currently 15 customers paying about 2 300 bucks per month each so doing about 34 grand per month in revenue that's up from 10 grand per month about a year ago so 3x year over year growth it's too early to talk about churn cac and ltv things like that but they're looking at scaling hoping to do maybe a million dollar round on a six million dollar pre-money evaluation later this year or early next year aiko thank you for taking us to the top perfectly summarized you know thanks a lot