Weekdone Revenue & Funding (2024)

hello everybody my guest this morning is yuri kalundi he's the ceo and co-founder of week done a weekly team check-in and quarterly okr goal setting service turned in turning any team into superheroes he's a serial entrepreneur having started building web-based products in 1994 or a product guy with a tech background and vast business leadership experience he's also co-founder of garage 48 startup foundation yuri are you ready to take us to the top hey nice to be here you bet thanks for joining okay let's get into it week done what do you do and how do you make money so basically we're a team productivity improvement tool initially we started really from weekly reporting and uh over the years actually i did quarterly goal setting so okrs objectives and key results that's really popular now especially in the us in text fair so basically yeah our business model is uh to charge seven dollars per user per month and we've been growing from that that's great so that the average truster pays you about seven bucks per month yes that's great and when did you launch the company uh we started actually four years ago so and we'll call it in 2013. yep and have you bootstrapped to raise capital we are mostly bootstrapped actually so initially we raised around 200k from some friends but we have been cash flow positive since 2015. oh that's great so 200 grand is all that's going on in the company yeah we're still we're we're still tiny so we're 12 people so okay and where are you based we're based in tiny estonia and even a tinier town of 100 000 people but uh actually like around 40 of our customers are in the us and all the rest all over the world so 12 in estonia most customers are in the us how many customers do you have total today uh a little bit uh below uh 1 000 companies okay so we'll call it like 900 something like that yup okay very good and uh and i mean tell us more about a customer story and specifically how they're using i mean how do you compete with like uh like other productivity apps like trello slack things like that yeah uh basically our main kind of buyer is any kind of team leader and initially when we started we really were selling for small teams of up to 10 people or 5 to 10 people so a team manager wants to get their like direct reports running better and over time actually we have grown from that so we are starting to have our first like thousand employee users and most still of our customers are like up to 100 200 people it can be a company with 200 people but we also have teams in fortune 500 with 100 or 200 people who just want to start the goal setting performance management or something like that in their teams and the big difference with any kind of like task managers project management tools is we all in our task lists have something like 100 things to do weekend is all about like uh reporting let's say five big things you want to tackle this week or three to five things you want to tackle this quarter and then making sure that you get those high level things done now with 900 customers paying seven bucks a month you're doing about 6.3 k right now in monthly revenue uh sorry uh seven dollars per user per month got it how many users across the 900 customers maybe that's a better question yeah well basically our mrr is around 75k so we are getting to 1 million arr soon got it so then to answer my question you have 900 companies and you have about 10 700 users across all those companies we actually have very different kind of historic pricing so um and that's something i've learned from both weekday week and other companies that uh we started from like one dollar per user and we all can try to be nice with customers and we always say we never raise uh prices for existing customers so we always grant for them i mean but the lesson learned is i i learned that in my first startup back in 97 actually that the more we raised our prices the better we started doing and the more seriously actually customers started taking us yep so how many paying seats are on your platform um around like a little bit below 10 000 employees i would say probably okay so 10 000 across about 900 logos is that fair so average team size on your platform is called around 10-ish 11 12-ish people it's probably actually bigger because i would say like um we have two times fewer custom customers in 25 user packages than 10 then two times fewer and fewer but we have quite many actually huawei nowadays actually hundreds and hundreds of customers so uh it's for election nowadays so we don't look at the like seed numbers so much we look much more at the customers got it now where were you at a year ago how much revenue were you doing in december 2016 yeah we've grown a little bit less than two times actually okay so you were doing call it 35ish thousand about a year ago yeah yeah i would say that's correct okay so good growth now with this kind of price point how are you dealing with churn what is it today and how are you getting it lower it's a it's very different our customer life cycle so quite often because companies we still sell a kind of process that companies need to implement in their teams and there are many who try us out for let's say quarterly goal sitting for one or two quarters and they just give up not on the tool but actually their process of goal setting and we mainly have to kind of work on those kind of who tune in the first three months six months we do quite a lot of kind of training for customers so we are always happy to do kind of video based screen sharing and training both for the managers as well employees how to kind of manage their week better or their quarter there so it's all about training and i would say kind of getting people to especially the employees to understand that it's needed for them not for hr or the manager so what is churn right now um i would say we turn probably around like fifty percent of customers per year five zero yeah okay got it so it's fairly high why are they churning uh like i say many try out or even a weekly reporting they try it out just for uh one month and then give up and we see that actually in the all of productivity this year like me all of us kind of trade let's say task managers but very quickly give up on them so someone makes it past like the first month how long do they stay with you after like what's that cohort look like it depends literally what they come from do they come more for like weekly reporting so or do they come for okrs so we see that the long-term goal setting which is quarterly there the tune is much much lower actually for those who do it on a kind of smaller level so the the cohorts are very very different actually for different also team sizes small teams give up easily if somebody makes an investment to do it with let's say 200 300 500 employees they most thoroughly make the investment for one two years and don't give up uh so easily that's right that's right and what are you paying to acquire customers right now uh we like we don't do actually any paid asset i think so all of our costs are content marketing so it's basically the cost of uh three four people and we do most of the content and uh mini sites and so on in-house so that's mostly the cost for us so how many new customers do you add each month right now um around uh 15. okay so around 15 you said 50 505 0. okay so if you add 50 so let me do the math here you have 12 people right now how many people are dedicated to sales and marketing and content uh we have three people in customers uh customer success and sales uh three people in marketing uh the rest is product okay so that's six people total kind of just in marketing if i assume an average salary there of 60 grand a year or about five grand a month that's 30 grand across your sales and marketing team and then if i divide 50 customers into that you're just paying about 600 bucks to acquire a customer is that about fully weighted uh i would say it's pro more like 300 so the european seller is a much slower actually than in the us so i'm envious i'm envious okay so 300 customer acquisition costs and then again you said the average customer is buying you know 10 or 12 person seats at seven bucks it pops 70 bucks a month so you're recovering that cac in what six seven months yeah kind of we tried to shoot so that uh kind of at least we make uh 750 dollars per per customer so and that's what uh what the kind of 10 percent team for one year would pay per per year per month per year per year per year sorry wait 150 per year 750 750 per year got it okay got so your payback yeah your payback period is about seven eight months which is a healthy payback period how do you um we've we've never been able to make paid ads or so work so the conversion there has been really bad actually so yeah we still experiment but uh neither retargeting or google adwords or facebook actually work for us yep yep not not always a bad thing um so okay good so with four and again with with 50 kind of annual return the average customer's gonna stay with you for 24 months at a seven dollar you know per month-ish price point so each seat to you is worth about 247 bucks in lifetime value right yeah yeah correct interesting um so how do you i mean what do you want to do next with this company is it something you're trying to sell and get a quick win or you want to raise a bunch of capital and scale it or just keep bootstrapping it and do a nice lifestyle kind of business we're kind of big believers into kind of indie businesses so uh so i kind of i like really what bryce roberts the vc is doing within the vc and many other initiatives where you kind of there is so much so many of these kind of bootstrap companies you see nowadays base camp is a big kind of role model for us for us atlassian and so on so there are these kind of companies i think it's more about like where the product is taking us and while we started from like features we all have become now or are becoming like a full continuous performance management suit so we are going more into selling to hr departments ceos larger companies and so on uh so uh going kind of upstream there is very important for us but uh yeah with our co-founders like uh we sit down each quarter and discuss should we raise financing and each time we have said that no we like this uh lifestyle how many founders do you have we have three three wow okay so you guys i mean you're not paying yourselves a huge salary right now uh well for european standards actually we are doing actually quite well okay so you're happy with that now let me ask you a question i know this space very well i have a wealthy friend you know a lot of people i surround myself with are in kind of banking or they do m a a lot uh that would like write easily a 1.5 million dollar check to acquire your company would you sell for that price or no definitely not what how do you think about acquisition um we haven't kind of discussed that actually yet but i mean we are kind of serial entrepreneurs ourselves we've done other businesses so i mean a million dollar for three people wouldn't be life changing in any way so i mean we can make more from our salaries that way actually so what did you sell your first company for um it was quite the mix actually so we made some money out of it but uh we started it uh actually back in 2000 so uh which was owner recruitment company which i expanded in europe across 10 plus countries did a lot of mistakes there spent huge amounts of venture capital and so on so much i'm a little bit uh actually for that time for like eastern europe eastern central europe i think it was uh like six seven million or something but uh again kind of it was big money for that time actually true or false you made more money on the salary you were able to pay yourself from that company than you did on the exit uh not really actually because uh no i made more actually on the exit side but uh today actually yeah i probably kind of i'm quite happy with the salary so you so so you sold that first company then for for at least you know one and a half to 2x that what you rate i mean you sold it for at least 12 15 million bucks actually a little bit lower than that but of course their liquidation preferences were very kind of strange actually with a large set of investors there and founders on different levels as well very good yuri let's wrap up here with the famous five number one what is the last business book that you read um last this book was the kind of i'm not sure if it's business but uh the new autobiography of richard branson so i'm a big fan of his number two is there a ceo you're following are studying right now uh i'm a big fan of jason freed of basecamp number three what is your favorite besides your own what's your favorite online tool um out of niche tools i'm a big fan of inspectlet which is a vape session recording tool that i use actually to look now and then of uh in blind what customers are doing inside week then inspect it inspect like this interesting okay number four how many hours of sleep do you get every night um i think sleep is the best drug so at least seven and a half hours okay and what's your situation married single you have kids uh single dating okay days so not married no kiddos huh no kids okay and how old are you yuri uh four to three 43 last question take us back 23 years what do you wish your 20 year old self knew um i would say that you can tell no to many things in life so focus and rather do fewer things uh better than trying to do everything there you guys have from yuri say no more often he sold his first company that he launched in 2000 for a little less than 12 million bucks he then launched work day back in 2013 sorry no you'd love to have work day wouldn't you right sorry week done week done he launched a week done his new company back in 2013 his team of 12 and estonia are making weeks more productive for over 900 teams spanning over 10 000 paid seats that pay seven bucks a pop doing about 75 grand a month right now in revenue up from 12 months ago in december 2016 doing just 35 grand so healthy growth churns high at 50 percent annually but they're working on bringing that down and cocktail tv ratio is super super healthy as they look to continue to scale yuri thank you for taking us to the top thank you nathan