VendorPm Revenue & Funding (2024)

[00:00] Hey, folks. My guest today is Emiel Bril. He's the Founder and CEO of vendorpm. His mission is to modernize the way property managers work with service vendors. Alright, Emiel. You ready to take us to the top? [00:10] >> Yeah. Happy to. I'll give a quick origin story here. Started my first business when I was 14 years old. It was just a shitty family situation. I had to make some money to help out my mom and sister at the time. So I started going door to door in my neighborhood, selling window cleaning services of all things, because at 14 years old, where else are you gonna get a job and make money? Ended up actually being [00:27] >> quite decent at it. Brought, you know, my friends along, they brought theirs. And before we knew it, you know, we had this team of fifty, sixty really, really hardworking, dedicated, like minded individuals at a young age. And we were all selling door to door, and we started, you know, building this relatively large business. We're doing about 10,000 homes a summer at the time. [00:44] Emiel, where were you? Oh, [00:45] >> this is Toronto. Okay. Great. This is Toronto. Yeah. And so we built this business through our high school, very early days of university, eventually sold that business, and then I started heading up sales for a high rise window. [00:56] Well, hold on. So when did you sell that business? How old were you? [00:58] >> That would have been around 20 '1, I believe. [01:00] And what do you [01:01] >> guys sell it for? In a relatively small amount, but also just undisclosed, and we'll keep that private for now. [01:07] Why did you guys decide to sell it at that? Why was that the right point in time to sell it? [01:11] >> You know, we were doing the same thing for for seven years and felt that we had learned everything that we, you know, we wanted to at the time. The initial motivation behind it was certainly monetary simply for the fact that I wanted to help my family out. And once especially at that stage in my life, high school, university, your needs are not, you know, what they are when you're, you know, later in your life, I felt [01:30] >> that I met my monetary goals, and I also felt that I'd learned and and expanded that business to a stage that I was comfortable with, and I was ready to take on the next challenge. [01:37] And what was but just before I move on to the next challenge, the scale of that business when you sold it was about how much in revenue that year? [01:42] >> Yeah. So I mean, again, this is a seasonal business. A, because most of your staff are are in school, high school, or uni. [01:48] Yeah. Yeah. But I mean, we talking like a $100 in sales or 2,000,000? [01:50] >> No. No. Roughly 1,000,000 a year was where we where we were sitting. [01:53] Yeah. Okay. Got it. And there was four of you, you said? [01:56] >> Oh, no. No. This was, I mean, this was myself that that had started that business, but there was, you know, a relatively large team. It was a a labor intensive intensive business, business, not not just just on on the the actual completion labor side of the of work, but also from a sales side as well. [02:08] Okay. Now take us into after '21. What happened next? [02:11] >> Sure. Sure. So I started heading up sales for a high rise window cleaning company. It's still, you know, within that world that I was familiar with, and I started getting an idea of, you know, really that sticker shock when you go from, we'll call it, single family home to commercial. And by the way, just for definition purposes, when I say commercial, we're talking about office, condo, apartment, hospitality, hotels, anything that's not consumer single family homes. And [02:33] >> really, really got that sticker shock. Reason being is, you know, to clean the windows, let's say, just the exterior windows of a single family home, $1,200. To clean the exterior windows of a, you know, an average condo or apartment building could be $10,000 to $20,000. Or these contracts, these multiyear contracts could be, you know, in in the 7 figures. Right? And so I'd gotten really excited by just how much money property managers, because I'm selling to property [02:56] >> managers, not homeowners anymore, are are spending on something like window cleaning. And so I thought to myself, well, if they're spending this much money to make their windows shine and sparkle, how much are they spending on literally every other building service? Okay. And that number annually in North America is over 400,000,000,000. So it's a very hard number to ignore. [03:16] >> Now from there, I was evaluating the way that they're spending this money, the workflows involved. [03:21] I'm sorry. Personal context. You're you're skipping college or you're in college doing this? [03:25] >> So I I actually didn't graduate. I never went to to class. It was pretty much just I went to McMaster's in Hamilton. And I would just drive over to Hamilton, cram the night before, do my exams. But the focus throughout my university days was certainly on business. [03:40] Oh, what's going on there, YouTube? Good to see you guys. Now imagine this. You love watching these interviews with SaaS founders, but imagine if we took all of the valuation data out from over 2,807 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 Founderpath. Check this out. I'll show you how you can access this in a second, but you log in, you connect [04:03] your Stripe account, you see your valuation real time, you can see what it changed over the past eighty eight days and even set goals for valuation this year. Now the secret evaluation is there's many different ways to value a SaaS business. So the reason you're gonna see three or four different valuations inside of your Founderpath dashboard, this is all free by the way, is because depending on who's doing the buying of your SaaS company, you're gonna [04:28] get a different valuation. A VC is gonna pay a different valuation, private equity firm is different. If you're gonna 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 [04:49] not built off random data. Again, you guys hear these interviews on YouTube. All these datas are built from real time valuation data points founder share with us on the show. So traction, 1,200,000 seed round, 3.7 raise. They sold 22% of their business. Go in here and filter by the event. Maybe you only wanna 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 [05:15] going out right now and you're raising your seed round. We'll 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 dataset of SaaS valuations than what you can get now inside of Founderpath. And we're thrilled to bring it to you. Alright. We're gonna go back to the YouTube video here in a second, but if [05:37] you wanna check this tool out, if you wanna jump in and sign up, you can check it out for free to get your valuation at this link. This link, founderpath.com/products/valuations. 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. Alright. Let's jump back into the [06:03] interview. Two questions. Why do university? And do you do university? But also, why go join a high rise cleaning company as head of sales if you just sort of sold your company for it sounds like potentially a nice chunk of money for a 21 year old? [06:17] >> Yeah. So two fold. Okay. So the first question was sorry. Could you repeat the first question again, Nathan? [06:22] Why go to college? [06:24] >> Oh, yeah. A 100%. So listen. If I could go back and do it again, I don't I don't know if I would. The truth is that, you know, both my parents are immigrants. There's something that's super important to them. I said to myself, look. If I can do both and it really doesn't come at a material cost to growing a business, then I'd rather make them happy. And especially my dad being ill, this is something really [06:40] >> important to him. You know, I it it came at little cost, and it was something that I justified as being worthwhile. Listen. And Again, this is you know, we're talking about soft skills here. Right? It's not something that you necessarily need to learn through a textbook. When you're studying hard skills, I mean, that makes a lot of sense to to complete your education. So very different conversation and a whole other rabbit hole. But to your second [07:00] >> question around why join this company? Because the scale, the requirements, the knowledge, it's a completely different world. You're talking about in a single family home space, two story, three story homes, and now you're talking about sixty, seventy story buildings. So there's simply a learning curve, and I I wanted to derisk by by learning from, you know, someone who's been there, done that, and and built a successful business in the space. [07:22] Mhmm. So fast forward here. What year did you launch vendorpm? [07:26] >> Launched vendorpm in 2020, And I'll give you just a quick thirty seconds of what I learned and what led to that being in that high rise window opening world. So a, the massive spend. You know, the GMV in this market is for over $400,000,000,000 annually. The workflows today are completely manual and offline. They're heavily reliant on email, Excel, word-of-mouth. And remember, I sat on the supply side of this dynamic, and I saw this transpire thousands of [07:48] >> times. Every single time, this would come at the expense of property management. Right? And I just wanna clarify, we're not talking about the manager of an individual condo unit or a single family home. This is institutional property management. They're managing entire assets, buildings. Right? [08:01] Yeah. Yeah. Yeah. The the water flows hot, cold going the right way, the fire pumps working, the HVAC working correctly, a paint jobs, like that kind of stuff. [08:09] >> Exactly. And that's what led to starting vendorpm in 2020. [08:12] I see. Okay. Got it. So you're out of college at this point? [08:16] >> Out of college at this point. Yeah. Just graduated. [08:18] How's dad doing? [08:20] >> Not doing anymore. [08:22] I'm sorry to hear that. Okay. So so did did well, I guess, mean, since you sort of shared that as part of your story, did did, I guess, his passing have any impact on you saying, you know what? I'm gonna go try and hit a home run for myself here. [08:34] >> Quite candidly, I don't feel, that it had much of an impact. I know that his wish wasn't for business or wealth or any of that sort. He just wants me to live a happy and balanced life. Listen. That said, every time you I'll be be quite candid and honest with you. Every time you hit a major milestone, go, Oh shit, it would be great if he was here to see this, to celebrate this, right? But no, [08:54] >> it had nothing to do with it directly, I would say. [08:57] And what about your mom? [08:59] >> I mean, listen, she's an amazing woman. She lives quite a simple life. And I all I have to say is she's, you know, she's seen this, you know, let's say one degree out, seen us grow vendorpm over the past years. And and you could tell that there's genuine pride there, which is obviously a great feeling. [09:15] That's amazing. Okay. So let's let's sort of not bury the headline. Fengate's a customer. Vision Young's a you know, BentallGreenOak coming off your website. Right? Community Living Toronto is a customer. What are these companies or these sort of owners of properties paying you on average per month to use your vendor management software? [09:33] >> Right. So at a high level, I'll just talk about what ACV is on both sides of the marketplace because this is a software enabled marketplace. ACV on the property management side, some of the names that you mentioned, is relatively nominal. Right? It could be anywhere between 6 to $10,000 a year. Okay. Where we do monetize is predominantly on the supply side, and that's on the vendors. And so ACV on the vendor side, it could be anywhere [09:57] >> between, let's say, 3 and $6,000 a year, but that's at volume. [10:01] Yep. Yep. Well, let's talk about that. So how many vendors, right, have made at least a dollar got at least a dollar of work on your platform over the past year? [10:09] >> Yeah. I mean, I I wouldn't have those exact stats, but I could tell you that in the past two years, just a couple quick, I guess, headline points on both sides of that marketplace is that we've gone from virtually zero on both to 5,000 buildings on the property management side, the demand side, and 35,000 vendors on the supply side. Now, that is all in Canada. We're launching now in The US. And so we do have a [10:30] >> big backlog of both supply and demand that's being implemented, being onboarded. But I yeah, I won't speak to those numbers yet, a, because they're so fluid, and b, I don't have them off the top of my head. [10:38] Yeah. We wanna talk about The US. But but look, there's a lot of marketplaces that build a lot of demand, but they can't get people to actually use the marketplace to transact. So how do you manage an active building? Are all 5,000 active? [10:50] >> Yeah. The vast majority are. And and and, you know, it's it's a very good point, especially our market is our our yeah. Our market is rather, we'll call it, behind as far as technology and adoption goes. So there's this massive change management piece that you need to deal with. You know, we're predominantly competing with manual processes, emails, phone calls. Right? So it's very difficult from a change management lens, and we've over indexed on product engineering and [11:17] >> customer success as a byproduct to to mitigate that, and we've done a good job doing so. [11:21] But just to be clear, how do you define an active building? Is it a dollar spent in the past thirty days or what? [11:26] >> Yeah. No. It's it's predominantly based on what we call wallet share. So we have this tool, this feature in vendorpm, where they're actually planning all of their services and all their contracts through vendorpm. That becomes the benchmark, what we call the scorecard for success. And you can take a fulfillment rate based on that. [11:40] I see. I see. Okay. And obviously, there's buildings and then property managers, but a property manager could have a lot of buildings. So how many property managers are there that manage the 5,000 buildings? [11:48] >> Yeah. Roughly 2,000. So the way that it works is, yeah, so the way that it works is, yes, you do have I mean, listen. You can have triple a office assets where you have a team of three or four, even five managing one building. And then you get a b and c class assets, which to your point, you have one property manager managing, let's say, two or three buildings per person. Right? Mhmm. [12:07] And then quickly, same set of questions on the other side of your marketplace. How do you define an active vendor? [12:12] >> Right. So an active vendor would be, are they responding to RFQs and RFPs that they're receiving from the property management side? [12:19] In the last thirty days? [12:21] >> Yeah. I mean, listen. The way we measure marketplace success is what are the percentage of RFPs that are getting three bids back? See, because that means that you have look right? That that means you have liquidity of supply, which is fundamental in a marketplace. It's not used to anybody. But that's also what the successful value exchange is for a property manager. You see the way that I look at it, I love I love comparing this to [12:41] >> Uber. Right? You you download Uber, you press a button, and that's that's your moment. Oh, this is so cool. A car is coming to me. That car doesn't get you to the right destination. You're not using Uber again. You don't have a successful value exchange. So that metric that I just defined, the percentage of RFPs that get three bids back, that defines both a successful value change for the PM and liquidity of supply. So that is [13:02] >> our service level guarantee. That's what [13:04] we're What's going the percent? [13:07] >> So today, in major metropolitan cities, it's over 90%. In some more, we'll call it secondary tertiary markets, it's about 75%. And I'll give you just some context here. Only six months ago, that number was at 15%. [13:21] Okay. A blend a blend a weighted average across both is something like 80% then, up from 15 Correct. [13:26] >> Correct. Yes. [13:27] What did you do to what leverage you put to go from 15% to fill rate to 80%? [13:31] >> Listen, it's a really corny line, and I can't remember who said it. I think it was Jobs. But essentially, focus is not what you say yes to, it's what you say no to. And the reason I say that is because we make a point, as a company, value of being so hyper focused and over focused on solving the direct problem in front of us that this simply wasn't a focus until we reached that part within the [13:50] >> process. I wouldn't say there's any one silver bullet. It was simply shifting our focus because it was the right time and place to do so and then a whole slew of lead bullets that led to improving this. And we're not done yet. There's still many more lead bullets that are gonna get this up to 100% or very close to. [14:06] So in February, your last full sort of month, right, of operating, how many RFPs were submitted through the platform? [14:12] >> Oh, yeah. Probably between five and six hundred. [14:16] 600. Okay. Interesting. And and then, I guess, tell me how you built the team out. You mentioned you mentioned some team sort of categories earlier, but what's the full size today? [14:25] >> Yeah. So full size of the team today is around 65. We have some exciting news that I can't I won't talk about now. [14:31] But How many how many engineers? [14:34] >> Engineer? I I actually need to go back and find the specifics, and I wouldn't wanna speak to those specifics right now either. [14:39] I mean, is it heavy engineering, or is this way more about, you know, signing up new vendors, new PMs? [14:44] >> I don't wanna say it's not heavy engineering. Listen. At the end of the day, you're selling a technology product, and your engineers are, you know, one of your greatest assets. So, listen, we're not building antimatter here, but this is largely an execution play as most marketplaces are. So you're definitely over indexing on areas like customer success, as an example. [15:03] Mhmm. And how have you decided to fund the business data? Are you bootstrapped? [15:07] >> No. Venture. [15:08] Okay. So tell me about sort of why did you decide to raise? When was the last raise completed? [15:13] >> So the last raise that was announced was in June or July of last year. That would have been our seed round. And look. The reason is ultimately the fact [15:22] How much was that for? [15:24] >> So that would have been a $4,000,000 round. [15:26] Okay. Got it. [15:27] >> And then, you know, some venture debt on top of that as well. [15:30] Tell me more about that. A lot of people don't use venture debt that early. Why did you decide to go that route? [15:34] >> An insurance policy. Don't need to draw on it, but I I I'd like to to derisk. [15:38] Do have to pay unused fees? [15:39] >> No. No unused fees on the debt. [15:41] Okay. Interesting. Do you bank with the bank that also gave you that line? [15:45] >> No. So there's no deposit relationship they're banking on? [15:49] No. Interesting. Okay. Got it. [15:50] >> So 4,000,000 seed. And then it sounds like you've got an announcement coming up. People can infer whatever they want about that, but that's great. Talk to me a little bit about, look, if you do this math. Right? [16:03] You you said 3 to 6,000 per vendor. Right? And, obviously, we can take 35 vendors or sorry, 35,000 vendors times three k a pop. I mean, I don't think you're doing a 105,000,000 in revenue. [16:15] >> No. See, there's a freemium model, and I don't wanna go into the details and specifics here, but but I will say there's a a freemium model. And we have yeah. We I mean, our our model has very strong triggers and retention that result in these conversions and and, you know, in the revenue growth we've been able to achieve today. I don't wanna speak to those numbers either, but [16:34] Well, I mean, by the way, Emiel, that's your genius. That's why we do the show. Right? So there's a lot of marketplaces where you hear everything you just said, but you know what? They're duds. They do nothing. They're worth nothing because no one uses them. Right? So how are you activating these vendors, which you define as they're responding to an RFP in the last thirty days? [16:49] >> Correct. That's the trigger as that's defining activation. That's also the trigger for upgrading in a lot of cases. [16:55] Yeah. But question is how? Right? A lot people can sign up 35,000 vendors. They can scrape Craigslist and do that in two seconds. The the genius in what you're doing is you're activating them. Right? So why are they responding to your RFPs and not other people's RFPs? [17:06] >> Because the alternative for them is phone calls, emails, and word-of-mouth. The same manual processes and heavy cost of sales that they've been reliant on for the past three, four decades. Mhmm. [17:17] And what would you consider again? It sounds like you don't wanna share your own numbers, but for general, in a marketplace, what would you consider a good conversion rate, right, on this side of the marketplace? [17:26] >> Well, it really depends on the triggers. I mean and sorry, the channels. Because there are multiple channels to which vendors are upgrading. Our strongest channel is is north of 50%. But look, ultimately, there's so many variables that were you couldn't give a solid answer to that question. You could be talking about a B2C marketplace where the average, we'll call it transaction, is in the hundreds. And as a byproduct, you don't have as strong of a trigger, [17:51] >> and therefore, the conversion is lessened. I think competition and tech stack the market is using currently plays a big role leading or I guess tying into your previous question, there's just way too many variables, and they're unique to each business and channel. [18:05] Mhmm. You talked about economics on both sides of the marketplace. But do you ever try and get to the point where you can actually quantify the money that vendorpm can generate from each RFP, like submitted and done through the platform? And if so, like, do you think about that? [18:17] >> Yeah. It's no. It's a really good question. It's I could tell that you're, you know, very thoughtful because these are questions that VCs would get to very quickly as well. Yes. We it is something that we think about, something that we were tracking early days. We were no longer tracking it because the business is growing at a at an incredibly rapid rate and the number's too fluid that it's [18:35] not What's incredibly rapid rate? You're talking like a 100% year over year or something different? [18:39] >> More than that. [18:40] Okay. Got it. Obviously, now going from a dollar to $5 is 500% growth. Right? So that doesn't it's not a not hugely valuable there in understanding your business. [18:48] >> Correct. I would say we're hitting, you know, where what tier one SaaS metrics is tier one growth, you know, growth targets would be for our stage. [18:55] Got it. We don't know what stage you're at. So why don't you talk about what those tier one metrics are? [19:00] >> Sure. Well, I mean, listen, as far as stage goes, we did, you know, we did our seed in January or sorry, June or July of last year. So so, you know, the next stage would be your series A. [19:09] When you do Yeah, I think it's kind of silly, I would think, to define a company by what they've raised. There's hundreds of companies that raise a lot of money and they do no revenue. Reflektive raised $150,000,000. They did 14,000,000 in revenue and sold for $14,000,000. It was a total dud. Yes. Right? So like, I don't think defining stage to what you've raised is a smart move. Would say most series A company I would say most [19:28] series A companies, obviously, they've gotta be growing at least 300% year over year, triple triple triple double double, right sort of thing. I would say that you're probably finding yourself in a weird spot though because you have to convince markets that you're a software company when really you're a software plus marketplace. And so you have to make sure they see that as a strength, not a weakness. Right? And I would say most people in their series [19:45] A right now are seeing between like a twenty five and forty x multiple if they can convince the market that they are truly a SaaS movement. [19:51] >> You sort [19:51] of in those ranges? [19:53] >> Yeah. I'd say yes. Let's say yes. [19:56] Yeah. Interesting. Look, what I love, there's a lot of folks that only have marketplace. WriterAccess is a good example. And you are in a very unique position where you own the relationship with these folks. You can build unique software specifically for each of them that is pure SaaS for the PMs and for the for the contractors on other side. Do you have any of those embedded SaaS tools yet or no? [20:12] >> Yes. On the demand side, we wanna build that more on the supply side. [20:16] Makes a ton of sense. Are you doing factoring or is there a lending business here where you're bringing forward RFP cash flows? [20:22] >> They're 100% will be. [20:23] Yeah. It makes a ton of sense there too. How much do you think you could deploy letting people get the cash thirty days upfront know, and then, you know, getting the invoice paid thirty days later? I mean, is it a is it a billion, a 100,000,000, what? [20:35] >> You know, we're taking a crawl, walk, run approach to it. So it's it's such a dynamic sliding scale. Obviously, the the goal is large numbers, but I'm gonna start small and do this do this the right way without without too much guesswork. [20:47] Yeah. I mean, painting that picture in a series a deck gets your valuation much higher. A lot of folks are treating this fintech revenue like SaaS revenue, which is not equal, but it is what it is. So we'll see what happens. We're we're rooting for you, man. Hell of a model here. Let's wrap up with the famous five. Number one, favorite business book? [21:00] >> Favorite business book? I actually just finished reading Radical Candor. Love it. I would recommend it to anyone on our stage. [21:06] Number two, is there a CEO you're following or studying? [21:10] >> You know, not no. Not one in particular. I I couldn't give that answer. [21:13] Number three, what's your favorite online tool for building the business? [21:17] >> I mean, look. I think especially when you think about the remote world, Slack has just been fundamental. It becomes your collaboration and your office when you are remote. [21:26] Mhmm. Number four. How many hours of sleep do you get every night? [21:29] >> Seven. [21:30] You sleep well. [21:31] >> That means there's a big secondary component in this round you're about to close. [21:34] >> Yeah. I don't know about that. I think it's more so I I just go to bed as early as I can. [21:38] Fair enough. Alright. And what's your situation? Married, single, kids? I [21:42] >> have a girlfriend. No kids right now. [21:44] Alright. And how old are you? [21:46] >> Just turned 26 a week ago. [21:47] 26. Very cool. Last question. Something you wish you knew six years ago when you were 20. [21:52] >> How hard it would be to start a tech company? [21:55] Guys, he cut his teeth at 14, sold his first business at 21 when his business was doing, called, a million bucks a year in revenue with him and some buddies. Then went to college, got some cut his teeth in high rise window cleaning, realized how big the GMV was in that space and said, you know what? I'm gonna launch my own company here called vendorpm in 2020. Raised a $4,000,000 seed round last year, scaling nicely. Now [22:15] he's got over 5,000 properties on on the platform across 2,000 property managers on one side, the supply side, the window cleaners, the painters, the HVAC crew, all that jazz. He's got 35,000 vendors signed up. 600 RFPs completed on the platform in February with a big announcement coming up. We'll see what happens. Emiel, thanks for taking us to top. [22:31] >> Awesome. Have a good one. [22:34] One more thing before you go. We have a brand new show every Thursday at 1PM Central. It's called Shark Tank for SaaS. 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, ARPU CAC, LTV, you name it, they share it and the buyers try and make a deal live. It is fun to watch every Thursday 1PM [22:59] Central. Additionally, remember these recorded founder interviews go live. We release them here on YouTube every day at 2PM Central. To make sure you don't miss any of that, make sure you click the subscribe button below here on YouTube, the big red button and then click the little bell notification to make sure you get notifications when we do go live. I wouldn't want you to miss breaking news in the SaaS world, whether it's an acquisition, a big [23:22] fundraise, a big sale, a big profitability statement or something else. I don't want you to miss it. Additionally, if you want to take this conversation deeper and further, we have by far the largest private Slack community for B2B SaaS founders. You want to get in there. We've probably talked about your tool if you're running a company or your firm if you're investing. You can go in there and quickly search and see what people are saying. Sign [23:43] up for that at nathanlatka.com/slack. In the meantime, I'm hanging out with you here on YouTube. I'll be in the comments for the next thirty minutes. Feel free to let me know what you thought about this episode. If you enjoyed it, click the thumbs up. We get a lot of haters that are mad at how aggressive I am on these shows, I do it so that we can all learn. We have to counter those people. We got [24:03] to push them away. Click the thumbs up below to counter them and know that I appreciate your guys'support. Alright, I'll be in the comments. See you.