Witty Works Revenue, Valuation & Funding (2024)

hey folks my guest today is nadia fisher she is one of the top 10 entrepreneurs in sweden formerly head of marketing and sam and a san francisco-based startup she became an i.t project manager and thereafter joined pwc to build their digital experience center at witty works she is the ceo and acts at the interface of clients needs and technological implementation nadia are you ready to take it to the top yes sure okay so what is woody works what are customers using you for well customers have real trouble scaling diversity and inclusion and that's what our b2b sauce is for it helps them to write inclusively and to act inclusively and this thanks to a de-biased language ai and micro learning so give me an example maybe someone's putting copy up on their website that says hey guys we hope you enjoy your product and you might say hey the word guys is not inclusive try this language instead exactly and it goes also deeper like you know there's much language out there that is a lot of people do not feel addressed because their socialization is different so if you also write yeah we're really an ambitious team and performance is super important that's all kind of language that only attracts a very small part interesting so how what might you recommend i change that sentence to well talk much more of the cooperation you're doing like here together we try to reach a certain goal and you know we're we believe in taking responsibility within the team so much more the cooperative and supportive side of language interesting and you're doing this via software right people are paying you a monthly fee or annual fee yeah exactly it's subscription based i mean there's a freemium out there so please try it out we're happy also for feedback and everything please try it out yeah it's it's like while you are writing um it highlights the terms that are problematic and then they it get you get proposed with um alternatives so you can write inclusively and you also get more information behind the term but the bias is behind the term so you can actually learn about your own biases very cool and the website is witty.works if you want to check it out now nadia what are people paying you per month on average to use the technology so it's easy it's a license per year of 180 um us dollars per year okay so every customer is paying 180 a year there's no cheaper there's no more expense if it's all a hundred percent oh yeah i mean it's you know as soon as companies start to buy 2 000 3000 licenses we have uh yeah we have another pricing going like a gradual pricing i mean do you have a lot of those customers that are buying so it's 180 bucks per year that's per seat yeah exactly i see so so ignore the per seat cost because what i'm really interested in is when someone signs up for you guys are they signing up 10 people on their team or a thousand so what's the average customer paying you per month all in not not per seat yeah i mean we're not so old yet so we just kind of started out uh like a half year ago so at the currently the average contract values are between let's say five and then ten thousand i would say um but naturally we're hoping for the compounding effect that now it kind of starts to expand within the companies and you know with that it will reach acvs of like 150 to 200 000. that's great okay so you just started uh price it sounds like you just started having customers about six months ago when did you write the first line of code for the platform um like one year ago um about yeah we had a kind of the mvp which we tested the market with and found out that you know yes customers are actually ready to spend money on inclusive language and and then as soon as we had that we we started to build a real product i see okay so windy works you get going in 2021 last year now did you have you bootstrapping have you raised capital so yeah the first months we were bootstrapping and then we raised capital uh mid last year with the national and friends and family around 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 it 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 valuation this year now the secret evaluation is there's many different ways to value a sas business so the reason you're going to see three or four different valuations inside of your frowner 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 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 raised 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 valuations 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 how much did you decide to raise 750 us dollars 50 000 us dollars sorry but you're okay and and most folks from the raising your precede round in that range they're usually raising on a note did you use a note no this was a little bit complicated i guess in switzerland we made an equity round but in the aftermath i wouldn't do that anymore it's just you know in switzerland when you use notes it's rather very small notes like 20 to 25 000 so you would have to raise a lot of notes and that makes it very complicated so that was why we went for an equity round i think in the aftermath i'd rather go go to the us or bigger markets and see if i can you know attract vcs from the start and two nodes well how do you how do you priced around your pre-revenue i mean how do you guys come up with evaluation yeah this was actually a negotiation topic we were it was funny because in the thing in the beginning we thought okay this is a scientific thing right and so we researched and we calculated and calculated again and then we find out because we didn't have any experience with first time store toppers so we realized that it was much more of a negotiation thing so you come out with a certain number and then you know angels will tell you no that's too high or you know this is a little bit of a risk if you don't have any experience yet actually and also it depends very much on the market so in switzerland the valuations are normally quite low in europe a little bit higher and compared to how low in switzerland well you know if you come out as a pre-seed it's it's really hard to get anything uh like you the pre-seed valuations are like between two million and maybe three million something like that where i see when i watch now the us you know stuff like that can already be at eight ten million so yeah yeah okay so you sort of raised in the two to three million valuation range something like that yeah exactly i see okay now second question obviously it's very dilutive right i assume that was pre money so maybe you sold 20 20 of the business something like that yeah i mean did you need that capital to grow or could you could you bootstrap this why do you need the capital well we wanted to be much faster because we so we realized okay this is being bought by the companies but we knew we needed expertise from nlp and from machine learning also you know some more experts in front-end development and if we had done it ourselves yes we could do it and you know just continue like that but um taking up capital just meant that we could be much faster and you know in the end we brought the product out within half a year and and and if we had done it ourselves it would take it would take us much longer and nadia how many customers are you now serving today i know you're early but are we talking two customers or 20 or something else so 32 customers and some of them really big brands like microsoft intel deutsche bahn um so deloitte so quite big customers actually yeah i know that sounds great now if we take the the acv target you told us earlier you know those customers are all paying between five and 10k acvs that means you're doing something like i mean it sounds like something like 250 000 bucks in annual recurring revenue already is that about right yeah that's about right exactly yeah or about 20 000 bucks a month if you calculate it on a monthly basis right exactly it's a 23 000 mrr absolutely there he goes she knows the number exactly 23 up up from nothing a year ago so you have infinite growth right yes [Laughter] that's great okay so i mean look selling enter your first sales at five to ten k a pop that's not easy most people are selling premium tools for like five bucks a month and they upsell from there you went right out and are landing 5 10k contracts how are you doing that well i guess it's because the need is really big um i see that a lot of companies are looking for a conclusive language they're they're really you know coming towards us actually we didn't have any marketing spent so far either so that's really cool it's a lot of content marketing we do but we didn't have to have any paid advertisement and i think yeah they're just ready to actually pay that price in order to finally have a solution and so far there's just nothing on the market fascinating tell me more about your team are you the sole founder no so i'm together with lucas um our cto and um yeah we both we actually met when we we used to work together before so we knew each other already and how we worked together so that's really cool and yeah he's a really big open source person i would say he's very known he used to be the global release manager of php so that's also really cool when we you know when we're looking for tech talent it's never a problem to find anyone that makes a lot of sense now uh what did you guys meet in sweden um so we're from switzerland switzerland sorry did you meet in switzerland yes we met in switzerland absolutely yeah and the reason i'm asking is so i'm actually headed in a couple days out to malmo in sweden for uh the sassiest event are you going to that it's a big sass conference uh no i'm not i've never heard of it okay i'll have to send you it'd be so cool to meet you in person i love meeting meeting founders in person but yeah i think the link is sassiest2022.com it's april 20th and 21st and malmo it'll be a lot of fun um tell me more about the rest of your team though so there's you and lucas as founders uh what's what's your total team size today so in total we're like 11 people uh eight and a half ft's because not of all of them work a hundred percent what's really cool is we're from nine different nationalities which for europe is very you know is a very diverse team um and i really like that um it also but it also means for example we have somebody who's half russian half ukrainian so that also you know the whole conflict is brought into the team which is is totally fine that's what we're here for um and yeah like half is working on on the tech side and half is working on marketing and sales on the tech side we actually have more women than men so that's nice wait so how many engineers for engineers yeah four engineers and uh three of them are women oh that's amazing that's why you're growing so fast all right for engineers uh great the others are sales marketing your go to market is content marketing strategy it sounds like 32 customers to date um talk to me a little bit more about the product what's the next big product release you have planned so the next big product release is uh the whole gamification part within the app to make that batter better so you can see your own progress you can see your analytics and and then naturally you know especially for big car corporations we have to take a look at uh at the whole privacy and data protection issue um naturally i know in the us it's maybe not such a big problem as in europe but um you know many corporations cannot you know let you work with a browser extension if the whole privacy issue is not regulated right yeah so we need to find their solution we actually already got it we just need to build it up you know to build private clouds for these corporations so they don't have to worry about a thing nadia do you already have a sales rep that carries a quota or you're too early for that we have one sales rep but i would say his his uh job is still very mixed so on the one hand it's like customer success getting back all the info you know getting back all the feedback in order to make sure that we develop according to customer needs and also doing partnerships uh partnerships with new language partners because we work together with language partners to make sure that our vocabulary is really being tested by externals as well okay that makes sense um i was gonna ask about churn and things but you're probably too early to look at most of that stuff right well i can tell you that we have a really good rate from our freemium from our visitors to our freemium that's like at 10 which is really nice we see that there we're a little bit higher than other sauce and the turn yeah i think we brought at least we brought it down i would say before it was like nine percent and now we've got it down to two percent when we you know made some improvements on the product but it's still not stable so we're still working on that yup yup okay this makes sense hey great story here uh let's wrap up with the famous five number one favorite business book favorite business book oh my god i'm all uh it's um i think the favorite one is it's not so much business well half is daniel h pink um about the third drive where he really talks about what does motivational work come from and it is not money number two is there a ceo or founder you're studying or following um oh good question i'm so bad with such role models i must say okay we'll say none number three what's your favorite online tool for building witty besides your own uh sorry i didn't understand your favorite online tool oh um slack number four how many hours of sleep do you get every night i really make sure that i get seven hours that's great and what's your situation are you married single kids so i'm married and i have two kids they're 14 and 16. oh wow and how do you want me asking how old you are i'm 50. oh wow that's amazing okay so 50 years old take us back 30 years what's something you wish you knew when you were 20. um i well when i was 20 the web just started going and i was kind of doing some html and i wish i had stayed with it i i really regret not having stayed with that but it wasn't the thing at that time so you didn't know it was like guys there you have it witty works launched last year helps you make sure all of your copy speaks to the uh the largest audience possible the most target audience is possible in the best way by helping you make sure you don't fall into weird words like using guys or super ambitious and try to be very specific to cater to the needs of your readers uh again launched with a 73 000 pre-seed round at a two to three million dollar evaluation they're now doing 23 000 a month in revenue across 32 customers scaling nicely a team of eight they have four engineers three of which are female which we love maybe that's why they're growing so fast nadia thanks for taking us to the top thank you very much have a nice time one more thing before you go we have a brand new show every thursday at 1 pm 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 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 1 p.m central additionally remember these recorded founder interviews go live we release them here on youtube every day at 2 p.m 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 sas world whether it's an acquisition a big 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 sas 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 up for that at nathan lacka dot com forward slash slack in the meantime i'm hanging out with you here on youtube i'll be in the comments for the next 30 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 but i do it so that we can all learn we have to counter those people we got to push them away click the thumbs up below to counter them and know that i appreciate your guys's support all right i'll be in the comments see ya