Voxpopme Revenue, Valuation & Funding (2025)

[00:00] Guys, watch out for BoxPop. Me. They're capital efficient raising just call it $1,516,000,000 bucks to grow revenues to 10,000,000. So they've been efficient, obviously, working with a lot of different groups of providers. We're excited to have funded them with $750,000 at Thunderbath on a twenty four month term. But more importantly, we were able to work with the chairman of the board and Lonnie and the go forward CEO, Andy, to reset some of the equity chunks of [00:21] the business to incentivize the go forward team. Andy, in day one in 2012, owned only 2% of the company. We wanna get him up to where he needs to be now as the go forward CEO. We weren't able to do that without him and Lani's support on the board. The full story was a good one. Enjoy the episode. So we're thrilled obviously with Andy. Andy and Lani today. They're running a company called VoxPopme, and we first [00:43] started speaking in terms of founder path and VoxPopme. Guys, this is crazy. It's all the back in February, actually. February 7 was my first email in my email inbox. But why you introduce yourselves really quick? Lottie, what's your role at Voxpotme? Andy, what's your role? [00:54] >> Yeah. I'm chairman of the board. I've been on the board now, I think, around four years, five years. So yeah. So that's my role, is to do what Andy tells me to do. [01:03] Hey, Andy. Something like that. Yeah. My role is now CEO. I was founder and originally CTO at Voxpop. Me, and I moved into the CEO role about seven months ago. So, yeah, it started off in yeah, end of twenty eleven is when we kind of originally founded the company, so I've been with it ever since. [01:25] And take us through a bit of the sort of company story after you give a teaser on what product the does? Because you're in a very exciting space. Andy, how would you describe the product? [01:35] Yeah. So we work with kind of large businesses, Fortune 500, helping them really understand their consumers a lot better through video. So companies doing research, either one to one interviews, focus groups, similar kind of setting to what we're in now, or launching video surveys and connecting with their consumers to understand their thoughts towards trends, spending habits, maybe new product ideation, right throughout the kind of research flow and really helping them to analyze that at scale and [02:04] understand their research centrally as well across the company and drive kind of customer empathy and change within the business. So it's been a super exciting journey from the start and initially kicked off with the idea of, yeah, we all had our phones in our pockets and everyone was getting more comfortable recording video and how could we connect brands to people and build an app and launched it that way as the kind of first kickoff point, and [02:31] grew from there, understanding the kind of research space more and more from a couple of, you know, technical founders who didn't come from market research originally, so we've learned a lot along the way. [02:41] I want to go back and learn about day one and your co founders and the original team and then Lonnie getting involved, etcetera. Before we do that though, Andy, I don't want to bury the lead here. Are you guys comfortable sharing what revenue is today or revenue range? How have you guys scaled? [02:54] Yeah. So total revenue wise, we're kind of sitting around the 10,000,000 mark. We're primarily ARR revenue from that. It's kind of about an eightytwenty split. [03:06] And, yeah, it's kind of, [03:09] you know, I think looking at a few interesting opportunities moving into this following year as well. So closing out this year, and we can kind of get onto that story a little bit in a while as to how we kind of progressed our relationship. But Mhmm. Yeah. Looking forward to a good year of expansion into a into a new territory moving forward next year as well. [03:29] So take us back to day one. When did you guys write the first line of code for the company? And, Andy, how did you decide to split equity with your co founders? [03:37] So, yeah, was, I mean, it was an interesting start to the company. So I was actually working with guy who founded the company with Dave Carruthers, and I was working as a technical director at his company to begin with, and then we started [03:51] What year was this, [03:52] >> by the way? [03:53] Sorry. This was 2012. So, yeah, about 2011, 2012, joined him. And that company was helping to bring in seed investment for, you know, we'd we'd have people come in with ideas. They wouldn't have the technical background. They'd be looking to fund. And so we were kind of incubating product startups from that point. We'd had some that ended up being pretty successful at the back of it, others that were very hit and miss. And so when we [04:21] came up with the idea around video and thinking about how we could connect with brands through that, we decided to kind of split off our own way and kind of took some of the learnings that we'd had from how the companies had been formed through that process, and that's how things worked out there. So, equity split was actually quite interesting because we kicked off with so first lines of code I was writing in the kind of [04:47] when would it have been? November 2012, I think it was. And so because we had these angel investors that were already familiar with everything that we were doing, we kind of went straight into that route and actually did some fundraising pretty early. And, yeah, that's kind of took an equity split based on that and a few of the roles that we kind of kicked off the company with at the time. [05:11] Are you comfortable sharing, Andy, sort of like percentages there? You know, Dave was about X percent, you were about Y percent, investors were about Z percent. [05:19] Yeah. I mean, was So at the time it was interesting because it was We'd actually formed it with number of people that we decided to kind of kick off from who were originally in the previous company. And so at the time, like, as a percentage, mine was pretty low. I think it was around like 23%. [05:40] So there were a few of us that took that amount, and actually a lot of people dropped off within, you know, probably within the first year. And so I was kind of always super passionate about everything that we were doing and have, you know, stuck at it for the long haul because I've been excited about the technology that we've been building and the opportunity space that we've been in as well. So, kind of probably at a [05:58] bit of a lower end from what you typically see within, you know, maybe some typical product sales startups as well from an equity standpoint. [06:05] Well, know, 2%, 3% in 2012. Now, twelve years later, you're the go forward CEO. You're the leader of the company. We'll talk about equity later on. But, Lonnie, let's introduce you to the story. When you came in and you said, let me look at the product. Let me look at the the team. Let me look at the equity split. What were your first thoughts? [06:20] >> Yeah. Yeah. So we were at at the time I was president of a company called InMoment, a customer experience platform. And we were growing rapidly and competing against some of the bigger CX platforms out there like the Qualtrics, the Medallias and, you know, those types. And so we needed something that was gonna differentiate us even further. And we started talking about video as an executive team. Our country manager in London called me one day. Was on [06:44] >> my way there and he said, found the company. I found the [06:46] company we need to [06:47] >> talk to. And they're good people. They're good humans and good our culture. [06:49] You wanted to acquire them at the start? [06:52] >> No. We just wanted to we didn't know. We didn't know if it was an acquisition or if we're gonna just integrate, you know, the technology. Andy, just walk you through into the platform. So I went to London, had a meeting there. And then one of the co founders with Andy flew to Salt Lake. And we met pretty much all day. Poor guy. We had 30 people in the room and just him pitching, you know, kind of [07:15] >> what Andy just walked you through. So then I had a chance to meet Andy and meet the team and we love the technology. And so we were one of the first back then to integrate video into our CX platform. And through that, we, you know, created a relationship [07:30] >> and just continued to work together for for a number of years. Then eventually I stepped [07:34] that money, that meeting in Aspen. [07:37] >> When was that? Yeah. Gosh. Andy, can you remember when that was? [07:42] '17? Yeah, was probably something around there. [07:46] >> Yeah. Yeah, I think so. Late sixteen, Then, early [07:50] >> you know, it was cutting edge too at that time. It's still cutting edge, but it was cutting edge and it had great, you know, sex appeal to it. And we were getting all kinds of meetings with the Nikes of the world. And, you know, it was really a lot of fun. And then again, to figure out how we were going to integrate that in an elegant way into the platform. And so eventually I stepped out after [08:11] >> eleven years in InMoment and wrote a book and doing some things like that. And then, Andy and team came to me and Dave came to me and said, hey, we'd love to have you on the board. And this was just right before COVID, if I recall. And we had the team over from The UK. And I remember that board meeting specifically because as soon as everybody was getting back on a plane, we said, hey, we might [08:35] >> want to talk about this COVID thing. Spent about ten or fifteen minutes talking about that. Of course, we all experienced it together around the world. So, yeah. So I've been on the board and then chairman of the board now for a number of years. And I just love the first and foremost, I love the team. Andy Andy's leadership, I've always appreciated. And clearly And [08:55] how many folks today are full time? [08:57] >> We have 70. [08:59] Around 60. 60 ish now. Yeah. [09:03] >> You know, and so we've in the last couple of years we've really managed, you know, costs and have been on a path to profitability. And now, you know, everything's really starting to turn with Andy's leadership and actually starting to invest back into the company, which is really exciting. And so, yeah, I just had great belief in in this company's opportunities and growth and and they work hard and and, you know, they I always say every day [09:27] >> with Andy or the team is a is a good energy day. You know, they're they're not downers. They they have smiles on their faces and they move forward. And I think in today's world as hard as everybody works, that's a big deal. [09:37] Hey, folks. If we haven't met yet, my name is Nathan Latka. I launched and sold my first software company back in 2015 and went on to write a book about it, which you guys made a Wall Street Journal bestseller purchasing over 30,000 copies. Thank you so much for that. After the book, I launched this show and went on to create founderpath.com. I raised a large fund to do non dilutive deals with B2B software founders. So far, [10:05] we've invested in over 400 software founders totaling $150,000,000. Here in 2024, we're doing three to four new deals per week. So if you're looking for capital and don't wanna give up equity, go sign up at founderpath.com for free to get your offer. Alright. Let's jump into the interview. Andy's cutting up the code. He's the product guy. He's in there doing the work. And now it's just like, okay. Now you're CEO. Now you're talking to customers too. [10:30] Right? You're doing all the customer calls. Right? Or or hanging out with the customer team. So that's exciting. I don't wanna skip over a key part of the story though, Lonnie. So you joined the board in 2019. I wanna understand sort of how you guys thought about equity early on and what the board structure looked like when you joined. Was it two, three, five, seven people? What was the board composition? [10:46] >> We had what do we see, Andy? What do we have? I think we had six Okay. Time roughly. And, yeah, I think, you know, even back then, as Andy referenced, you know, his own equity, there was always a conversation about it within the board and within the group, and wanting, you know, to get more and just with the makeup, the more money we were taking on, of course, dilution was starting to happen and [11:09] How much had you guys raised? [11:12] >> Andy, at that time? [11:14] So that time we were probably [11:17] so we went through I mean, I guess we were probably somewhere between the 15 and 20 mark at that Yeah. [11:24] Yep. [11:24] The Series A in 2019 was with Origin Ventures, think, for about 9,000,000, right? Something like that? [11:29] Yeah. Yeah. So we had we originally, yeah, raised some funds through Mercia, then Mercia followed on with Origins at that round, and then a stage later as well. Mhmm. [11:39] So Mercy and Origin have been fantastic partners based on everything you guys have told me. I've had the chance to chat with, I think, one or two of them and was really impressed. But I guess, Lani, when you joined the board and there was sort of all floating idea on the board agenda of like, hey. What should the equity split look like for the go forward management? Why wasn't sort of anything like like, you know, we [11:58] obviously pushed that once FounderPath came in, but why do you think that didn't happen ahead of time or before that? [12:03] >> You know, I think that at that time, just with the investments that were coming in, there was a lot of protection of those investments. And there was some equity that was being, you know, rolled out, but not to the point or level that you guys had recommended in an effort to raise, you know, the capital with you. And so there definitely was a push from the leadership team. I think we just had some some level of [12:24] >> protection from the board at that time and saying, hey, let's let's take everything we've done here and invest it and let's move forward and let's really get this thing growing. And so I think there was just a delay. I don't believe it was ever we don't want to give more. It's just let's now that we're on the playing field, you've got the equity. Let's see how you play. I think that was pretty much the deal during [12:45] >> that time. [12:46] And I think it's always tough as well because you're going through those stages of trying to raise. And at the time, I think we were concentrating so much on what we wanted to do with that within the business. We were not necessarily, like, thinking about it from our perspective at that early stage when we were going out to do that raise. And that's something that chatting to a lot of the other founders and things, having that [13:05] intention to go in. So you've had those expectations set up front. And so I think we're often coming out the back of those conversations and then trying to negotiate for things. And it becomes more difficult to do at that stage because you've gone through all the excitement of everything come out the other side. So, you know, things just kind of, you know, nudged on and nudged on at that time, and it wasn't through, yeah, anyone trying [13:24] to, you know, do anything untoward or bad towards us. It was just it was just the makeup of, like, how we went into that. I think that's something that I've definitely learned, you know, through that time. And I've and I've I've heard from other founders who have gone through the same same kind of struggles and and how to be more purposeful in that at later stages. [13:42] >> And Nathan, I think to the question too later on, you know, I'd say in the last three years, I remember one of the meetings I had specifically with one of our investors and, you know, the tone was now changing into what do we need? Who do you need? Who do we need to make sure, you know, is still flying the plane? So we have those conversations. Obviously, Andy was at the top of that list and we [14:02] >> had a couple of other people. And so we, you know, there was an openness to it with both of our lead investors actually. They were saying, okay, we've done a lot of work, you know, and we've made some progress. Clearly on the profitability side, we've made some significant process. But now how do we take this to the next level? And so you came in, you know, sometime after that. So I think the appetite was open even [14:23] >> more and we were talking about percentages and what could we do for Andy? You came in and blew that out of the water in a positive way. Yeah. [14:35] Look, so picking up at that part of the story from Founder Path's perspective, when we got the original data room from you guys, there was a couple things. Number one, we loved the business. We know the space pretty well. We know some other M and A activity in the space, and I also know the other products in the space really well. And when I got the product tour and talked to one or two of your customers, [14:51] I said, woah. This product is already feature parity with much larger companies in the exact same space. These guys just gotta get sales and marketing done and right? And you're gonna see the growth, and you're seeing that now. But one of the things the biggest risk we saw back in February when we were diligencing the Voxbot me deal despite loving the product was and I'm gonna generalize here because I don't remember the exact numbers, but when [15:14] I asked Andy and Lani Yu, hey, what is the go forward management team? Who's gonna take this thing to the next level? And you guys listed, you know, your key names, right? And there were several of them. And I then went back to my team and I looked at the cap table and I sort of looked at how much equity those names had. And I don't know what the exact number was, but it was something I [15:31] wanna say was like maybe something between like eight and maybe 15% of sort of like, this was the group that you guys said was gonna change the company and drive off future growth and they were already diluted down to like eight to 15 ish percent. And it was something on the order of like four to nine people, right? And my guys, wanna make sure I'm not misspeaking or something like that, right? [15:47] >> I think that's right. Yeah. Yep. Yeah. Yeah. Think that's right. [15:50] Yeah. Was right in that range. And so I saw this as an opportunity. I said, ah, the board doesn't maybe the board wants to put in money, maybe they don't or the the investors. I said, but we FounderPath can align with management here and use our capital coming as a forcing function to get a board resolution done to reestablish a new ESOP pool and then reissue those shares however the board wants to the go forward management [16:13] to increase their equity. When we propose that, Lani, Andy, what was internal communication like at the board level and the management level? What were you guys thinking? [16:20] >> You know, we well, what I was thinking and and, Andy, I'll let you talk to this too. But what I was thinking was refreshing. How refreshing is that? You know, you you're talking to an investor that actually wants to put more equity back in the hands of those that are going to take this to the next level. And how do we do it? And I knew at that time we have a very, I would say, communicative [16:39] >> and cohesive board. You know, it's not they're here to support. We may not get everything or the company at that time might not get everything they want, but they're open to it. So we had created a really nice culture with the board. Prior to that, I think we had a little more of a hostile culture with the board and and maybe a typical type old school board. But this one has been very supportive. So I thought [17:01] >> it was refreshing. I believe when Andy, you know, and I started chatting, he thought it was refreshing. So I started working on the board side of it with the investors and just, you know, open to the idea. So if you go back to that three year period, we'd already started saying, hey, we need to get more. And what you were talking about was more than what I had at least suggested to the board. So I thought [17:22] >> it was refreshing. So as we got into it, we had one board meeting, where I was still I stepped in for a period of time as acting CEO, in transition, you know, as we went through a couple of changes and I, we had proposed as an executive team something different in terms of looking at founder path and basically got the nod to go ahead and move forward in continuing to talk with you guys. And so I [17:46] >> think and I'll stop there and let Eddie take it from there. But we had you know, it was a really refreshing approach. And then we were geeking out a little bit, Nathan, about you personally and the work that you've done in your company and how you do it and your podcasts and your knowledge. And, you know, so we were kind of communicating back and forth with everybody. And I think everybody was was really eating that up. [18:09] >> So, Baron, I'll let you speak to it, Andy. [18:12] Yeah. And I think I think that's [18:13] >> yeah. [18:14] That's right. And I think it was obviously kind of there were conversations that, yeah, Lonnie would have with the board, you know, on one stream of things and kind of I was thinking about the kind of broader team as well. But, yeah, I think it was the combination of the excitement of kind of working with with you and the team at Founder Path, Nathan, and kind of, yeah, you have knowledge in the area. The work that's [18:33] going on there is like, how can we learn from that and help the team bring the team along on that journey as well? And so, yeah, did open up the chance to have that opportunity. And I guess an outside perspective coming into it, which maybe we hadn't had before, right? Because the conversations are all happening internally or from within the investors', you know, own, you know, meetings that they're having and things like that, having an outside [18:53] perspective coming into that and saying, hey, this is really where it should be, you know, help to kind of facilitate those conversations moving forward and get us into a better spot. [19:01] >> Yeah, it was fresh. [19:04] So Fresh is a good word. Fresh is a [19:06] good word. [19:06] Yes. So just for you guys listening on the podcast, basically what we effectively said, and I'm sort of paraphrasing and summarize here, but we basically say, hey. Look. We'll fund the business with a million or a million and 0.5 or whatever it is. But at at the funding date, we also need to see a board resolution that establishes a new ten, fifteen, whatever was ESOP pool, and a chunk of that ESOP will immediately be reallocated sort [19:26] of to management go forward. And we were able to sort of bring all these things together and get it done. Andy, Lani, one of the key pieces of the story that we skipped over, but it happens to so many founders and you never read about it in the press because everyone is really shy and they're not sure how to talk about it in a positive way. Anytime you have more than one co founder and a company's [19:43] been around for more than ten years, you're gonna have co founder conflict. It doesn't have to be bad conflict. You're just gonna have diverging interests and diverging priorities, and eventually, you're gonna maybe have one co founder that leaves the business. So you have a big chunk of equity that we call nonoperational, which, you know, maybe they deserve it, maybe they don't. That's besides the point. But you guys have only said really great things about the founding [20:03] team. There was never anything negative mentioned, just the fact that diverging priorities. Talk a little bit about sort of how the company ended up with so much sort of equity nonoperational sort of outside the business and why that happened. [20:16] Yeah. I think it was I mean, when we yeah. Me and me and Dave kind of start start up the business, and and very early on, we had another guy, Tom Williams, joined us kind of five, six months into the business. And so we we made him a a founder as well and and kind of saw it as, you know, a great kind of unit between us in order to kind of drive the business forward. Tom [20:37] was focused purely on the revenue side, Dave as CEO, and me from a technical and product side. And we always, you know, as I said, like those initial years and everything, it was like, it was lot, but it was like we had great fun doing it and everything. Dave then moved over to The US because we realized that we've got a huge opportunity there, and that gave us a good split of someone revenue focused in both [21:01] areas. It was great because at the time, InMoment actually gave us some office space at their office in order to sit ourselves in a spot in The US. We were trying [21:11] to keep it close. [21:13] Smart, Lani. Smart. [21:16] I think, yeah, like, as time went on, yeah, there are different approaches and different thought processes, everyone's kind of coming at it with a slightly different perspective on things, you know. And it definitely there's, tension that can build there between founders. As I said, it's a long journey to go through and not have those tensions and those things happen. [21:40] Tom had left the business during COVID, his time. [21:47] It's a long journey for anyone to go through, and you've got to be all in. Dave got to the same point where he felt like it was his time to move away from the business as well. But together we've driven that business forward and done a lot. And so I think everything is deserving to those folks. And, you know, I literally texting back and forth with with Dave just prior to this to this call as well. [22:14] So, you know, we went through a tougher period, definitely, and have kind of built things back up. But it's great to now kind of have that, you know, support as well from those that were in the business, that continues to drive forward. Same with our previous CFO, we've seen him out in Park City, and kind of extend your network and your reach into other areas as well. So although they're not within the business, like, there's always [22:37] someone else to call on, it's great to be in that position because it could so easily go a different direction, I think, with with when these things happen. [22:45] >> And then I'll just add, Nathan, if I may, a little color to that as well. It followed Andy all the way through that. I remember that all those days and as we were going through it and I think all the way back to Tom, you know, Tom had felt like he had run his course with what he had contributed to the company. [23:00] What was Tom? [23:01] >> He was the CFO? [23:03] CRO. CRO. [23:04] >> CRO. Yeah. And I think, you know, there's those different stages of the company where, you know, a founder or an executive comes in and says, okay, I've taken it from zero to 10 or whatever the case may be and who's going take it to 10 to 20 and what does that actually mean? And I think that's part of what we saw. And then when Dave decided to step away from the company, it was good for his [23:24] >> own health. He had some other ideas and recognized, I think, respectfully that maybe, you know, there was some different leadership that was needed to move on from there. And then also the CFO at the time, within a thirty day period or so roughly, it also kind of come to that same conclusion. I think the message of that is is that that's why culture is so important and, you know, working with teams closely is because we work [23:48] >> hard and it can wear people down, you know, over time. And both of those individuals, actually, all three of those individuals are succeeding and flying and doing different things. And Dave's just started a new company and he's excited about it and everybody communicates and connects. But it was time even for me to step aside and step back into the chairman role, let Andy go. And Andy has just taken things in the last seven months, you know, [24:11] >> to a new level. So it's it's I feel like a proud dad, but it makes me feel old. He's done all this by himself and, of course, with the team, but he's really doing a remarkable job all the way down into getting, you know, the relationship with you. So [24:24] Well, yeah. And we appreciate I appreciate you guys talking so openly about this. You know, Lonnie, you sit on a lot of boards. We diligence a lot of companies, and this happens, like, literally 95% of the time is there some kind of cofounder conflict like this, and there's a variety of ways to solve it. Right? You could pay cash to buy out on you know, and this is this is all this could also be early angels. [24:43] Right? Or, you know, just nonoperational nonoperational equity. You could raise money to then go buy out those and do a secondary. You could reestablish a new ESOP pool with board approval that effectively dilutes the whole business and then gives more incentive to go forward management. Lani, have you seen any other effective strategies to incentivize go forward management when there's a big chunk of unoperational equity? [25:02] >> You know, I think we've done some things along the way even, you know, through kind of a tough three year period, if you will, just with the economy and everything kind of shifting to the left and right. So short term stuff, bonuses and, you know, things like that is. So it'd be more on a lower level scale if you will. So if we couldn't get the equity there and you know what's interesting too, I one time [25:24] >> wanted to give equity to an executive team, another organization that I was there and everybody was grateful for it. But one guy and he came to me and said, hey, I've got two kids in college and I'm trying to get through that and cash is more important to me now than it will be in the future. And we sat down as a team and, you know, worked with HR to make sure we were we were above [25:44] >> board doing everything correctly. But we did something completely different for him that kept him in the seat all the way until, you know, like five six years later when the company started to transition. So I think sometimes what motivates us is not always what we think and, you know, Andy's case, clearly he's been there from the beginning. So being able to do what we've done, what you've done for him, and we were able to prove has [26:08] >> been a really big, you know, boost to him. So nontraditional stuff is still very effective and we've used it from small to big. [26:16] Let's wrap up, guys, the last three minutes here with just sort of the Founder Path experience. So are you guys comfortable sharing what deal we ended up doing together, the amount and maybe the term or whatever you're comfortable sharing, Andy? [26:27] Yeah. So we ended up doing seven fifty ks, so over twenty four months. We [26:39] looked at a few different ranges with that, and we started off smaller, [26:46] sat somewhere in the middle because we had a very strategic plan for coming into this next year that we want to be able to utilize those funds for, and have kind of earmarked that for some areas that we know we've got some success coming. We've had a lot of companies kind of, you know, transitioning from other tools coming to us, saying that they want to use us and from a completely new buyer set. So we were [27:10] like, alright, this is something we need to go after because it's not often these things kind of land on your doorstep in this way. And so recognizing that, that's something we wanted to move quickly on. You know, again, we've been having the conversations from February, right? But I think there was a lot of back and forth in deciding what we wanted to do, and you were extremely supportive in that period of time. [27:29] What a rush. We wanted you guys to love your pro form a, and Skyler, your CFO is very talented, and it was clear you guys were crossing all the t's and...