How Zomentum CEO Shruti Ghatge grew to $4.7M revenue and 2.8K customers in 2023.

momentum doing 35 000 a month a year ago now doing 250 000 a month with their two-sided Network helping you grow faster with partner programs they've got over uh they've got uh over 2 800 Partners on one side of their Marketplace and SAS companies bring in another 1200 over 4 000 Partners on their platform as they look to scale again a two-sided Marketplace here 13 million series a at a little under 100 million valuation last year 75 on the team 38 Engineers as she looks to scale with their four-person sales team based out of Bangalore with 300 000 to 500 000 quota Target hey folks my guest today is Surety godkey she is the CEO of zomentum a revenue platform to help Partners and partner programs scale the platform fuels technology sells over 800 million today she was an investor investing in seed in series a SAS stars for jumping into the business and was named crn women of the channel 2022. so momentum was awarded a great place to work under her leadership she's now looking to scale all right shorty ready to take us to the top yes very excited to be here very cool okay so how does momentum work what does it mean to platform what does it mean to help people scale partner Revenue oh well partner programs and partner Revenue has been a black box for most SAS companies usually and and the reason it exists is because SAS companies and partners are trying to go to market together but they live in their own silos what we do as a platform is get both of them together on a single platform where they can come to get deals done right like that's how we look at it now who would you sort of put in your space I mean crossbeam comes to mind is that the biggest one or who else well the Cross Beam isn't uh is step one it helps you identify what are the opportunities are we come after that that once you've identified the opportunities how do you work together to drive them to closure interesting okay and and how do you think about pricing your technology what's the average customer pay you per month on average oh an average customer is a very per partner fee which which is a sliding scale and uh on the SAS company side but we also have a motion where we add partners by ourselves or who are paying anywhere between 100 to 200 per month to use the tool and and why would someone maybe pay you know more than that 300 400 bucks a month what are you upselling against uh on the partner side like it's a two-sided Network so we attract uh both Partners on one side and SAS companies on the other the partners pay for additional functionality like the basics of the sales tool that is built for partners is what the price I'm coding for but beyond that uh we do billing reconciliation uh separately we do assessments we help them uh integrate with a bunch of SAS vendors so all of that is at an additional password the partners and what do the SAS companies pay or is it free for them no the SAS companies pay for the partners that they manage our partners pay us directly the SAS companies pay for the connection that you're enabling right like you're getting these two siled entities on one platform and that's what they pay for which is the per partner fee and of course we do billing records what is that surely what is the per part so what's the average tax company pay you per month uh it can go as low as uh 30 per partner per month about what what's the big like what's your don't name the company obviously but what's your biggest SAS company customer paying you per year per month uh I'd say around 100K contract oh wow okay so if I'm if I'm a sales company paying you a hundred thousand dollars per year what am I getting like hundreds of Partners uh you're getting to manage your partner so it's a tool to manage your partners and a network that we come with ourselves so it's a handshake in some sense and very interesting okay very interesting now before I get more of your back story and how you launched and grew help me understand so this year if you if you look at a hundred percent of your Revenue what percent will come from Partners versus SAS companies I want to say uh the SAS company-led motion is a few quarters old so fairly new like that so partner driven motion is two years old so I want to say 60 comes from Partners today okay wow but but still 40 from SAS companies considering how new it is it's pretty impressive because it's an accelerated Bay of go to market because every SAS company adds to the network their own Partners right very interesting okay give me more of your backstory what year did you launch the company uh we launched in 2018 um later half of 2018 so it's been four years now who is we do you have co-founders or your sole founder I have a co-founder for Tech and product I take care of everything business very cool do you guys just play nice and split 50 50 at the beginning or what uh I don't think it's plain nice like that like the distribution but it's to the table which were very complementary 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 evaluation this year now the secret valuation 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 founder 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 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 around 3.7 raise 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 valuation 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 did you negotiate that though I mean this is a very hard thing for a lot of early teams to negotiate anything other than 50 50 tends to generate create some friction how did you go through that process oh well my co-founder I mean he's an engineer by background worked at Twitter and Drew break and but had worked very closely with partner teams um so he had a business sense and very strong on product he was just a techie by profession but I think he's more strong product person and I think product and business go very hand in hand and I think them think of them as an equal distribution only Tech maybe I would have thought very differently okay so you I mean it is fair to say you could just put a 50 50 then if you consider both those equal at the beginning correct which is why we did it right ah okay okay so you did split 50 50. okay cool now have you guys I don't think you have bootstrap I think you've raised but have you bootstrapped a raise capital uh we have raised Capital yeah so tell me fill out the funding story a little bit first off when when did you do the first round and why was it important for you to get that first round done oh I think like we didn't raise immediately most of the initial I wouldn't say like nine months went and Pro customer research we're not from the industry it was a very thesis driven startup for us um I mean some context as I used to be I used to work at Excel before this investing in a lot of SAS companies and we saw this problem and wanted to solve for it but spend the next six nine months just figuring out our veg into the market right like one it's a two-sided Network so we had to solve for chicken and egg but which side would we solve for how would we penetrate with such a sharp value prop inside is what we spend time so we didn't write a single line of code I want to say at least 12 months into the company right which is just uh being sure that hey we are committed to this we've figured an entry point and that's when we raised our initial seat round and how much was that for in what year um it was four million in seat and then we raised series a last year okay so four million seed and then I think I can't I don't want to skip over this what's really really important you saw probably a lot of marketplaces at Excel and then you went in and launched your own you had to decide what side do you want to go after first and what's your mousetrap what decision did you make what side did you go after first we went after the partners first so SAS coming it says and if they're successful that just means they're selling more SAS means by Design the SAS company is going to be successful so we've solved for partner first yeah that makes sense okay so so staying on that theme how many partners pay you at least a dollar per month today uh we have around 4 000 Partners in the network um and and I want to say 70 of them pay us to use a product how did you get I mean that's a huge conversion rate right even for B2B status how did you get 70 to pay you uh I mean just to be clear out of four thousand that'd be like 2 800 are paying per month and that's the partners that we've acquired the others are also paid for on behalf of the sascom the SAS companies pay for them so there is no way to get in free here oh I see I see got it got it okay so 2800 paying uh an average of 200 bucks a month I mean isn't that's like 560 000 a month right there in Revenue right yeah I mean there is baggage of pricing where we started very low at 39 increased it to 49.99 and now we've uh increased prices so there's some grandfathering effect there but um I want to say like because of compounding then it's not as high yeah I see I see so moving forward new partners you're signing up are paying on average 200 but historically the average was maybe something more like you know 60 70 80 bucks something like that yeah yeah because okay like respected those prices for them of course which is very nice of you by the way I mean I think it's only fair for them to take a punt on us early on right fair enough fair enough okay so 2 800 Partners to fix this map 2800 Partners paying a lower average per month of like 70 bucks a month there's more like 190 000 a month in revenue from that part of the business is that more in the range where you are yes yes fair enough and if that's where you're at today where were you one year ago so we can sort of understand your growth skill 8x 8X in the last 12 . okay so you're gonna make me do the math so 190 000 a month is from partners and partners are 60 to your Revenue so increasing another 40 on top that means you're doing it also it's only two quarter sold like the other 40 percent is a chunk of that is it's yeah okay so maybe total mrr today is around 200 Grand and that's eight times higher than you were a year ago is that fair uh maybe slightly more but yes okay fair enough fair enough fair enough okay cool but but still really impressive growth right I mean 250 Grand a month divided by eight weights so that's like 31 000 a year ago right how have you gotten all this growth is it more Partners or or more Partners per SAS company oh I think the partner love is real right like for us a demo to a paid sign up conversion is upwards of 55 it's between 55 60 right like and those are numbers I hadn't seen myself when I was working at Excel um so I think that's what's working for us like the product really works at a partner site the churn numbers are the sub point five percent monthly but the conversion rates are really high right let me ask you a question I mean if you last year if you've grown 8X 250 000 a month today and that would mean you're at like 34 35 000 a month exactly a year ago but you close a 13 million series hey how did you close a 13 million dollar series a with just 35 000 a month in Revenue oh I think like um it's a network company I want I want to say it's a SAS driven Network company and the Network's more valuable we have not don't intend to milk the network up front like like one parallel I like to draw here is LinkedIn right like it has all all job Seekers and job providers on the other hand but like lots of business models have emerged like ads and Navigator and recruiter and whatnot um so once the Network's in place and we become the de facto place for all SAS companies to grow and manage and launch partner programs then that's the mode we're working towards right and so not network is the not star metric here that makes sense and then in terms of obviously look you raised you're an xvc managing dilution is really important most folks raising last year in a series they were selling between 10 and 15 of their business were you sort of in that same range yes okay so that means you're raising I mean you broke 100 million evaluation then post money I'm slightly lower than that but uh in that negotiation ballpark yes yeah okay fascinating I mean now fast forward to markets today does that really high valuation you got in terms of Revenue multiple now make it now worry you a little bit uh I mean I think like we fundamentally believe in the network really ourselves like we our Network touches more than a million and a half business and then that's the demand aggregation that we have today um so actually it's become more lucrative to the SAS companies I'm realizing because now they're looking for efficient channels of growth and partners happen to be the efficient way to grow businesses um so our networks become more valuable to SAS companies and and I'll see how that pans out over the next year but at least on paper this is what's what we're hearing talk to me more about how you've built this your people how many folks are full-time today uh roughly 75 of them and how many engineers um a good 50 is engineering wow okay so call it 38 39 are Engineers what about the rest of the team what are they focused on oh that's divided between sales support customer success uh marketing uh majorly do you have any quota carrying sales reps today and if so how many uh we have four product hiring sales reps today okay come on teach us teach us here I have audience members going I want to hire my first quota carrying that but I don't know what quota said I don't know what ramp time to give them I don't know what OTE to quote a ratio should be how did you set that up for your first four I don't know either like the the first the ones who joined us in the zero to one which is after I was doing the sales we figured it out with them and we've been like okay in the first few quarters when we are new to Market we are going to reward you on the effort versus the outcome because you don't have control over it but once we figure that out we move it to a very outcome based also it's a very inside sales lead motion so I don't know if my numbers are going to mix uh are going to be the same for say U.S sales reps right like all our sales happens out of India very cool which uh which country or sorry which city Bangalore I mean at this point they're all over the country but when we started we were in Bangalore that's amazing and so what is the quota for those reps in Bangalore annual quota oh ten times what their income is okay so what is that like 300K 400k annual quota something like that interesting um very cool can those reps close deals with U.S partners oh very much Department driven is more inbound for us so those that's that quota is very different I'm talking about the SAS company side of it right uh which is still like the longer sales cycle and but even those deals we close out of India there's a lot of Founders even in India I mean I talked to Girish at freshworks saravana Rajesh at netcore some of these folks that say we can't get our Indie our sales reps in India to sell to us customers they're trying to launch sales teams in the US which are way more expensive you haven't run into this problem I think like um I mean I work very closely with freshworks as part of excel but I think like five years back the story was very different but they've learned they've trained themselves and the really good ones have have figured it out and of course that pool is much smaller than what you'd like it to be uh but it's still much cheaper than having a U.S rep right yeah fair enough and you mentioned earlier your your gross revenue turn per month I think was about point five percent when you add back expansion on top of that is your net dollar retention above 100 percent yes on the partner side though there are not more Avenues which is like what we've known for a while because it's only the seat increase and some add-ons here and there but still above 100 on the SAS company side of course there is more expansion potential because they add Partners themselves and we get benefit of it last question as we wrap up here how are you getting more SAS companies on the platform what is your growth strategy there uh honestly I wish I had a better answer but it's slightly heavy on outbound today as we are creating awareness that of our own existence and uh also like we are the only one sort of doing this two-sided Network in the channel space so uh to articulate that value prop takes some time and that's something we are working on on our positioning itself uh but it's fairly events and outbound heavy today all right should be on that note let's wrap up here with the famous five number one what's your favorite book oh I play bigger number two is the CEO that you're following or studying uh I I follow a lot of them and I don't want to put them on a pedestal because then it's like I try to humanize them because it helps me do my job better so I don't want to take a name yeah fair enough number three what's your favorite online tool for building sumantum oh I I used to do a lot of Envision mocking early on now the team uses a lot of things but I like Envision when I sold a product without having one fair enough number four how many hours of sleep do you get every night oh I sleep a good seven eight hours and situation married single kids single okay and can I ask how old you are uh I'm 32. 31 turning 32. 31 very good last question something you wish you knew when you were 20. oh that I'd be fine like I I used to be but I wanted to do things very quickly in life but I think I turned out fine guys there you have it zomentum doing 35 000 a month a year ago now doing 250 000 a month with their two-sided Network helping you grow faster with partner programs they've got over uh they've got uh over 2 800 Partners on one side of their Marketplace and SAS companies bring in another 1200 it's over 4 000 Partners on their platform as they look to scale again a two-sided Marketplace here 13 million series a at a little under 100 million valuation last year 75 on the team 38 Engineers as she looks to scale with her four-person sales team based out of Bangalore with 300 000 to 500 000 quota Target we'll see what happens next shorty thanks for taking us to the top thank you very much one more thing before you go we have a brand new show every Thursday at 1pm 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 our poo CAC LTV you name it they share it and the buyers try and 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