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Founder Interview
Company Metrics at Interview Time
Customers
3,100
Avg Contract Value
$40,000
Net Dollar Retention
140%
Team Size
315
Gross Margin
80%
Historical Snapshot
These numbers were reported by Manny Medina during his interview with Nathan Latka recorded in May 2019 and represent a historical snapshot, not current figures. See Outreach’s current numbers.
| Metric | Value | Source |
|---|---|---|
| Customers (2019) | 3,100 | Founder interview, May 2019 |
| Customers (2018) | 2,200 | Founder interview, May 2019 |
| Avg Contract Value | $40,000 | Founder interview, May 2019 |
| ARPU (2017) | $2,400 | Founder interview, May 2019 |
| Net Dollar Retention | 140% | Founder interview, May 2019 |
| Gross Margin | 80% | Founder interview, May 2019 |
| Team Size (2019) | 315 | Founder interview, May 2019 |
| Team Size (2018) | 250 | Founder interview, May 2019 |
| Total Funding Raised | $60,000,000 | Founder interview, May 2019 |
Manny confirmed Outreach passed $10,000,000 in new bookings per quarter in 2018 and was targeting $17,000,000 in new bookings per quarter by Q4 2019. The company was growing north of 100% year over year at interview time. Average contract value had risen to $40,000 per year, up significantly from a $2,400 ARPU figure cited in 2017.
Outreach grew from 2,200 customers in early 2018 to 3,100 customers by May 2019. Growth was driven by a combination of heavy outbound sales, account-based marketing, and the acquisition of SalesHacker to educate the broader market.
The team grew from 250 employees in early 2018 to 315 by May 2019, with the company headquartered in newly opened Seattle offices. The company also hired a new CRO, Mike Muni, who had previously helped scale companies past $300,000,000 and $800,000,000 in revenue.
Outreach had raised $60,000,000 in total funding at interview time and was burning between $2,000,000 and $3,000,000 per month net. Manny indicated the company was not yet cash flow positive and hinted that a new funding announcement could be forthcoming.
Outreach ran coordinated ABM programs alongside outbound SDR sequences, targeting the same personas simultaneously with direct mail packages, LinkedIn ads, website retargeting, and outbound calls. This surrounding approach allowed the team to measure which combination of touches was most efficient per segment.
The SDR team maintained roughly 15 active sequence types mapped across four personas and four market segments. Every element of outreach, including subject lines, first sentences, and LinkedIn InMail copy, was continuously tested to improve connection rates, reply rates, and LinkedIn connect rates by even 1%, which compounded downstream into more pipeline per SDR.
Outreach acquired SalesHacker to gain a direct channel for educating the market about sales engagement. Manny identified market education as the primary long-term growth constraint, and owning SalesHacker gave the company an outlet to tell its story and demonstrate capabilities the market did not yet believe were possible.
After a deal closed, a dedicated implementation manager took ownership of the account and worked to get 70% of purchased seats to daily active usage before handing off to a CSM. This front-loaded adoption effort was credited directly with achieving net dollar retention in the 140s.
Once accounts hit the 70% adoption threshold, CSMs focused on identifying unused workflows and expanding Outreach usage across additional teams such as account executives and inbound teams. CSMs had a commission program tied to renewal targets, aligning their incentives with expansion revenue without the downside risk of a hard quota.
“We have a good sense of the market and we always know who's buying who. We are in a very privileged position in which we are creating a new category.”
“We haven't raised additional capital, but we're always talking to investors, so don't be surprised as news come out.”
“200 is a new 100. So you can, it's no longer a long...”
“I think that we have to go public. The accountability is different, the liquidity is different.”
“I want to do what Amazon is doing, which is they pay their salaries fairly low, but each employee is capturing the entire upside of their execution because of the market reward.”
“Our net retention is in the 140s right now because of that.”
“We passed the $10,000,000 quarter mark last year. So we're now adding over $10,000,000 a quarter every quarter.”
“I'm far more concerned about maintaining that 70% user adoption and acquiring new workflows. And we have proven here internally that by doing that, you hit expansion triggers.”
“It's input metrics. Like what capacity do I need to generate that kind of money and everything else takes care of itself.”
“Starting a company is not that hard, It's a lot harder than it looks. It looks a lot harder than it is.”
This interview captured Outreach at a specific moment in May 2019 when the company had 3,100 customers, 315 employees, and was accelerating past $10,000,000 in new bookings per quarter. The numbers Manny shared reflect what he reported on that recording date and are not current. Outreach went on to raise additional capital, including a $200,000,000 Series G in 2021, reaching a $4,400,000,000 valuation and $489,000,000 in total funding. Visit the Outreach company profile on getLatka for the most current metrics.
View Outreach’s current profile and metrics| New Bookings Per Quarter (2018 milestone) | $10,000,000 | Founder interview, May 2019 |
| New Bookings Per Quarter Stretch Goal (Q4 2019) | $17,000,000 | Founder interview, May 2019 |
| Monthly Net Burn | $2,000,000 to $3,000,000 | Founder interview, May 2019 |
| Year Founded | 2014 | Founder interview, May 2019 |
| SDR to AE Ratio | Less than 1 SDR per 2 AEs | Founder interview, May 2019 |
| Seat Adoption Target | 70% daily usage | Founder interview, May 2019 |
| Payback Period Maximum | 20 months gross margin adjusted | Founder interview, May 2019 |
Nathan Latka
00:00Hello, everybody. My guest today is Manny Medina. He's the CEO of Outreach, the leading sales engagement platform. Medina joined Amazon's AWS team as an early employee and helped Microsoft drive the mobile division from launch to 50,000,000 in annual revenue. He has an MBA from Harvard Business School and a computer science master's from the University of Pennsylvania. Manny, you ready to take us to the top?
Manny Medina
00:19>> Let's do this.
Nathan Latka
00:20All right, come on. In the bio, your team says the leading sales engagement platform. Know I have to push you on the fluffy stuff. So how do you know you're the leading one?
Manny Medina
00:30>> We have a good sense of the market and we always know who's buying who. We are in a very privileged position in which we are creating a new category. So as the category is getting created, people are talking to all of us, to everybody in the category. So we have visibility into who is doing what at all times. So we track very closely the wins and the losses and the sizes of each of those and the
00:51>> expansion opportunities and so forth. So we know by the numbers that we are the one that win the most accounts and the most money. Because we're also growing, we're also racing, we're close to Silicon Valley and everything, hear the feedback from investors telling us that we are the leading. So it's both the feedback loop and the market itself telling us.
Nathan Latka
01:10So when you were back on the show last in February 2018, you'd said you were at about two fifty employees at the time. You'd raised, I think, 60,000,000 in funding is what you said. Give us an update on those two numbers. What's team size today, and have you raised additional capital?
Manny Medina
01:23>> We haven't raised additional capital, but we're always talking to investors, so don't be surprised as news come out. We are at three fifteen employees right now. We actually just moved, we're in brand new offices right here in Seattle. And we are hiring a fresh new batch of the C level suite. So we have a new CRO.
01:47>> And what else?
Nathan Latka
01:49Well, Manny, hold on, hold on. New CRO, this is usually one the first signals I'm looking for, for anyone that I think might be pushing a 100,000,000 in ARR in terms of, Hey, we're looking at going public. So who was the CRO and have they taken a company public recently?
Manny Medina
02:03>> No, so right, you're right. So we hired our CRO, we hired Mike Muni from Centrify. And he was involved in growing north of 300,000,000 with HP and then with Imperva, took him to almost 800,000,000 in ARR. And then recently he joined Centrify, but that got acquired by Toma Bravo. So he's looking for a clean slate, something to take from zero to public himself in
Nathan Latka
02:29a public Well, maybe you're not exactly at zero anymore. I mean, maybe more like 60 to public, right?
Manny Medina
02:34>> Well, 60 to public and the public numbers are a moving target, right? So you can't, 200 is a new 100. So you can, it's no longer a
Nathan Latka
02:42long Is that right? Is that it? It's really, gotta you hit 200,000,000 in ARR to have a have a good IPO?
Manny Medina
02:47>> That's what Goldman is telling everybody. Interesting.
Nathan Latka
02:51Why why why is I mean, why do you think that is?
Manny Medina
02:54>> The the amount of liquidity in the market is just stupid at this point.
Nathan Latka
02:57So you can stay private for longer?
Manny Medina
02:59>> Stay private for longer. Funds are playing both sides now, funds that used to be public funds, hedge funds and so forth, are playing the private markets now too. Because you can write a $50 to $100,000,000 check and invest it all, like that whole thing, into one company, and then let that ride out. So if you have a $600,000,000 allocation for a particular company, you can start making bets early on and just capture the upside as the
03:22>> company goes from growth stage to public.
Nathan Latka
03:24Is your, in the back of your head, you're kind of like, wow, the whole team is kind of aligned on, we'd love to go public one day, or do you think there's a path to actually staying private, up to $405,106 $100,000,000 in ARR?
Manny Medina
03:36>> I think that we have to go public. The accountability is different, the liquidity is different. I want to do what Amazon is doing, which is they pay their salaries fairly low, but each employee is capturing the entire upside of their execution because of the market reward. You see what I mean?
03:59>> It's a beautiful position to be in, in which you sort of cap your base, but the market is paying your employees their bonuses and their salary increases. So it's an incredible position to be in. And I wanna be the Amazon for SaaS enterprise.
Nathan Latka
04:15Yeah, you see it as a way to potentially attract talent, but save your cash flow, use the equity value in the liquid markets to build a rockstar team.
Manny Medina
04:22>> Exactly. And it's like the market is paying the employees a bonus for performance. So we all align, there's no better alignment than that.
Nathan Latka
04:29Yeah, all right Manny, for people that don't know, the rare person that doesn't know what outreach is, what do you guys do?
Manny Medina
04:35>> You were to think of, sales engagement means that if you were to think about what a rep does every day, the rep calls and emails and follows up and book calendar appointments and documents, LinkedIn, etcetera. That whole thing needs to be orchestrated for you to be able to measure it and improve it. So in Outreach it creates the single pane of glass where you can live and take all those actions. So what we do is we're
04:54>> separating the CRM layer, which is where the data is stored, to the system of action where the data is acted on. So by creating a layer where the system is acted on, you actually get better performance because you have visibility to what the rep is doing at all times, and it's not working. It's not getting what you need out of the rep to move the deal forward.
Nathan Latka
05:12Yep. Last time you were on again, February 2018, you said you had about 2,500 customers.
Manny Medina
05:16>> What do you
Nathan Latka
05:17what do you announce? Or sorry, 2,200 customers. What do you announce today?
Manny Medina
05:20>> 3,100.
Nathan Latka
05:21And so where's Manny, where's most of that growth coming from? What's the what's the tactic that you've been testing? An outbound, inbound content? What is
Manny Medina
05:28>> So we have been heavily outbound. We actually I used to pride myself of being, you know, called outbound engine for the longest time. We bought we bought a company, SalesHacker, since last time we talked.
Nathan Latka
05:38Yeah. Max by the way by the way, I was, in like, the middle of trying to work a deal with him to buy the conference somehow. I'm like, he's not replying to my emails. He's working on something big. And then I see the news. I'm like, goddamn it, Manny. Get out of my way, man. Now Max is a great guy, and he has a book out too. How's that going so far?
Manny Medina
05:56>> Oh, it's blowing up. It's blowing up because, again, we're redefining what sales means. Sales is no longer bravado, lone cowboy, do whatever it takes to win. Some people win, some people lose. Sales is becoming a very scientific game in which you need to optimize the time of the rep and the activity that they take to get the most juice out of that transaction. And matches both empathy,
06:22>> science, and obsession into one package. And that's what the book is. It lays out the groundwork for what sales engagement will be. But to get back to your question, so we bought CellSlackers so that we can actually have access to educating the community. What we figure is that our impediment to long term growth was education, was educating the market that any of the stuff that we're doing is actually possible. And every time we release something from
06:44>> the machine learning team and we tell the market that we just did this, the market is like, Oh my God, how is this even possible? I don't believe you. You see what mean? And because we're true to our Seattle like roots in which we do what we say we're gonna do, we never market ahead of capability, we needed the ability for us to have an outlet to tell our story. And that's what we bought CellSacker and
07:02>> that's what brings us here.
Nathan Latka
07:03So heavy outbound, give the ratios real quick, because I'm sure you've tested this. In the inside sales team. So what's the ratio from SDR to AE right now?
Manny Medina
07:13>> Oh, it's less than one to one. So last time we talked, I think it was over one to one, one and a half or so SDR per AE, and now we're dialing that down significantly to less than one SDR, and we're gonna get to one SDR per two AEs.
Nathan Latka
07:27Okay, per two AEs, what has allowed the SDRs to get more efficient?
Manny Medina
07:32>> Outreach.
Nathan Latka
07:33What? Outreach. Well, your tool. Okay, got it. Can you be specific though? I mean, I know it's your tool you build it in, but what actually is it? Is it higher response rates on the cold emails? I mean, what is it?
Manny Medina
07:44>> So it's because we are nonstop testing. So we have a team actually internally that what they do is they test language. As we break down by persona, right? So we figure out what persona are we reaching out. And then for each of those personas, we break it down by segment. You see what I mean? So you have persona mid market, persona enterprise, persona blind market.
Nathan Latka
08:05How many personas do you have by the way?
Manny Medina
08:07>> On the SDR team, think we're testing about 15, give or
Nathan Latka
08:11And then go down one more layer, you said each persona has segments, how many segments?
Manny Medina
08:15>> So we have four segments. So we have four segments and about four personas, so four by four is 16. There's a few that are just non performing for us. So we have about 15 sequence types that is addressing each of these persona market dotting the matrix. And so for each we have a sequence and then we test everything that goes out to them. So to make sure that we are Every performance improvement of like 1% of
08:42>> connection rate or 1% on reply rates or 1% of connect rates on LinkedIn creates a downstream effect on the amount of funnel that you can create per SDR.
Nathan Latka
08:51Hold on Manny, hold on. That's a really valuable thing. Wanna go deeper there real quick. You just mentioned cold outreach on LinkedIn. Again, testing maybe the subject line in the first sentence of the InMail or the cold email. What are two or three other first touches you're experimenting with besides email and LinkedIn outreach?
Manny Medina
09:07>> Packages.
Nathan Latka
09:08What do you mean?
Manny Medina
09:09>> I feel direct mail. Really? So sending you something ahead of the call, sending you something ahead of the email has incredible ability to move the needle.
09:21>> The way you think about your entire go to market program is that you have an efficient frontier of what is SDR generated versus sales respected by the
09:34>> figure that out versus what is the number that you're solving for in your CAC, in your payback time, and in your margin. And then you sort of like draw a line and you figure out what is the right combo per segment based on your ACV and based on your time to close, so that you can actually get to the right economic unit for that persona. See what I mean? So what we are constantly doing is constantly
09:53>> saying, okay, my SDR is gonna perform all these activities and I'm gonna get all this juice out of it, while we're ABM ing, we're doing an account based marketing program against the same persona. Meaning, the moment you get a package, you also get an ad on LinkedIn. And then the moment you click on that and you see something on the website, you're also getting retargeted. And then we see, what do you spend time on? And then
10:16>> we have a call outbound going to you saying, hey, I noticed you did this, would you want to talk about it? So the ability to create that surrounding of the experiencing is what gives us the ability to measure what is efficient and what is not.
Nathan Latka
10:28Manny, give me the inputs again. You said CAC payback, what are the other things that change depending on which segment and persona combo you're at?
Manny Medina
10:33>> Yeah, the deal, so CAC payback, the ACD.
Nathan Latka
10:37Okay.
Manny Medina
10:38>> And then how long does it take to land that deal? Because if your team isn't prospecting against a deal but it takes six months to land a $10,000 deal, that's not very efficient. So you wanna figure out what is the right ACD CAC deal length combination to figure out the right program for that portfolio.
Nathan Latka
10:58There any single metric you are normalizing across all your segments? Like you never want payback to be longer than eight months?
Manny Medina
11:05>> You never want payback to be longer than twenty Okay. Gross margin adjusted payback. It can be
11:11a little
11:11>> bit months.
Nathan Latka
11:12So when you say gross margin adjusted, just to be clear, you're taking your ACV, your first year ACV, you're then taking your CAC and then you're multiplying times whatever 87, 84%, whatever your margin is.
Manny Medina
11:23>> Exactly. What is your margin? I think it's in the 80% right now.
Nathan Latka
11:27Okay, got it. Good, okay.
Manny Medina
11:30>> And most SaaS companies will have roughly, assuming there's nothing weird, right? You don't have a big component of professional services, etcetera. Assuming all that, a good healthy SaaS company should be running margins end of somewhere between 80 to 70%, 65% even if you're growing really fast. Because the majority of it is support in Amazon Web Services or Google Cloud or whatever you're using. Finish
Nathan Latka
11:55the kind of sales stack you're using with here right now. So less than one SDR per two AEs, once an AE closes that deal, are they passed off to a customer success person or does the AE own the upsell expansion as well?
Manny Medina
12:07>> That's a great question. So the moment you close a deal, for us in particular adoption, because we're an engagement, we're a system of action, adoption is our true north. So the moment you close a deal, then it gets passed on to what we call the implementation manager. An implementation manager takes that entire account, the seat, so if somebody bought 100 seats, that deal goes to the implementation manager and we need to assure that 70% of those
12:31>> seats have daily usage.
Nathan Latka
12:33Like measured by logins or number of messages sent?
Manny Medina
12:36>> Measured by what we call them, sales positive motions. So the ability for you to use the application manually, like you're doing something in the application that creates an opportunity, creates a meeting, creates a reply, creates a follow-up, whatever is creating something that is moving the deal forward, we measure. And we need to get 70% of the seats doing daily positive motions. And that's when we graduate into a CSM. And then the CSM gets into the business
13:01>> of educating that account as opposed to getting to adopt.
13:04Okay.
13:04>> And that's
13:04how we
13:04>> break it down.
Nathan Latka
13:05Your typical implementation manager is on these accounts for about how long? That take a month or a year?
Manny Medina
13:13>> It depends on the length of the deployment. So if it's, again, a 100% account deployment, it usually takes about a month to two months to get everybody to learn and to use it at a scale in such a way that it doesn't become a problem downstream of adoption, etcetera.
Nathan Latka
13:28Okay. So this is your tactic to get month one to month two churn as low as you possibly can, right?
Manny Medina
13:34>> Precisely. That's how we manage to have Our net retention is in the 140s right now because of that.
Nathan Latka
13:42The way, Manny, you know I do a lot these interviews. I mean, I would consider that world class net revenue retention.
Manny Medina
13:48>> Yes. But that's how you do it. It's that you solve for the user activity by attacking that user activity upfront. While the deal is hot, while there is engagement and you have the champion, the ink is still wet on paper, that's when you attack the adoption problem so that you don't have to deal with that later on when you're trying to do your renewal upsell, cross sell or whatever.
Nathan Latka
14:09How many implementation managers per AE?
Manny Medina
14:13>> Depending on the size of the AE, we usually have,
14:19>> at this point we have one to one.
Nathan Latka
14:21Okay, got it. Manny, I'm just going to summarize up to the CSM. Less than one SDR is keeping two AEs busy. Those two AEs are closing and all the things those two AEs close, one implementation manager can handle over a month to four months, however long it takes to onboard 70% measured by sales process motions. Once the implementation manager hits that 70% seat usage, it's passed off to a CSM and call it month four or five,
14:46six, somewhere in that timeframe. How many CSMs per implementation managers? Raise.
Manny Medina
14:52>> It's a little lower because at this point the CSM is working on education programs. Meaning the CSM, she doesn't have to worry about adoption anymore, she has to worry about education. So we already have dashboards for all of them to see how sophisticated they are in the platform. Meaning, are they using AB testing? Are they using persona triggers? Do they have their inbound workflows capturing outreach as opposed to the outbound workflows? And if it's not, then
15:18>> go capture that other workflow. Then go capture the account executive workflow. So the CSM is already trained to see for opportunities to capture additional workflows and bring them into outreach.
Nathan Latka
15:27So it's like the implementation manager is going wide. 70% seats, the CMSs go deep. Correct. Yeah, interesting. Okay, here's a big question. This is a big debate right now amongst other companies in the 100,000,000 kind of ARR range. Are your CSMs quota carrying based off expansion revenue?
Manny Medina
15:43>> That is a hot topic. Yeah. They are not quota carrying per se, meaning they don't get fired, they don't get a quota, but they do have a renewal target.
Nathan Latka
15:55Okay. But they get no personal upside if they hit it other than maybe a bad performance review.
Manny Medina
16:01>> They they do. So they do. So they you have you get the upside, but you don't get the downside. So quota carrying in my mind will mean you get fired if you don't hit quota. Yep. You get the upside if you don't hit quota.
Nathan Latka
16:10Oh, so they are there's a commission?
Manny Medina
16:12>> Yeah. They do have a commission program. Yes.
Nathan Latka
16:14Oh, okay. Can I ask, like, minimum commission in the year is like 10%, 5% too?
Manny Medina
16:19>> It's less than 10. But it's less five. I I it could be 10, but I don't recall.
Nathan Latka
16:25Yeah. We're getting we're getting really in the weeds, but I'm just I'm curious. So if a CSM-
Manny Medina
16:29>> I think it's important. So this is the part that is tricky, This is why it's a hot debate, is that I am far more concerned about maintaining that 70% user adoption and acquiring new workflows. And we have proven here internally that by doing that, you hit expansion triggers. But I cannot explain, like if you were to ask me why, or how does it work, I won't be able to explain
Nathan Latka
16:50to Manny, this is why, and not just trying to blow smoke up your ass. If you understand, if you if the process works, the outcomes will just happen. You're investing in the golden goose and you know the golden eggs will just come out faster. Right?
Manny Medina
17:03>> So I'm far more concerned about the leading indicators as opposed to lagging indicators.
Nathan Latka
17:07100%, okay. So 2014 launch, 3,100 customers today, you've added, that's up from 2,200 about eighteen months ago. Average customer paying about what these days?
Manny Medina
17:17>> We're up to,
17:20>> I think it's somewhere between 40 and $60,000 per year.
Nathan Latka
17:23Per year. Okay, good. So we'll say $40,000 per year minimum there. That's about 3,300 per month. Let me see. That's up. Yeah, that's up your ARPU a year and a half ago. You told me it was about $2,400. So that's testament to you've driven expansion revenue, right? It makes a lot of sense.
Manny Medina
17:36>> Yeah, not only that, but we also move quite a bit up market. And when you move up market, levers of negotiation kind of change a little bit, right? Because they want a lot of security, they want a lot of governments, they want all these other things that are way more expensive and they either have it or they don't. You see what mean? It's not like an SMB account can trade them off. And a big enterprise account,
17:58>> fuck, I don't remember what you said. In a big enterprise account, there's a lot of things that are non negotiable.
Nathan Latka
18:05Now Manny, I have to do the math because you gave me the numbers. So correct me here if I'm wrong, but 3,100 customers, dollars 40,000 ACV, that would put you north of $10,000,000 a month right now in MRR. Is that accurate
Manny Medina
18:16>> or near? We're not quite there yet, but I can tell you the following, I don't have permission to do this, so this is an exclusive.
Nathan Latka
18:24This is great.
Manny Medina
18:25>> We passed the $10,000,000 quarter mark last year. So we're now adding over $10,000,000 a quarter every quarter.
Nathan Latka
18:32In new bookings?
Manny Medina
18:33>> In new bookings, yeah.
Nathan Latka
18:34And that is actually, that is the metric a lot of the most advanced kind of investors and VCs and PE firms will look at is actually new bookings per quarter. So congratulations on that. Growth year over year.
Manny Medina
18:46>> We are worth north of a 100 still.
Nathan Latka
18:48Even at these even at these kinds of big numbers. I mean, because last time you by the way, last time we came on again, February 2018, told me, I mean, you were north of five five point three a month, right? So you're pushing, it sounds like getting close to 10. I mean, that's impressive at this scale.
Manny Medina
19:03>> So the good news is that because, the size of the market is just enormous. We're deploying against install base for CRM. So we're now, we're just mopping up, everybody who has Salesforce or Dynamics doesn't have a layer of engagement. So everybody's working out of spreadsheets or somewhere outside of CRM. So that entire market is available to us and that's an $80,000,000,000 So for us it's literally a capacity problem and an education problem. The more educated market,
19:30>> this is what we build sales cycle, the more educated we have. And then all I need is capacity to go deliver against that. This is what we need to, to my earlier point, is what we need to address that need with the right effective approach for that particular segment. As long as we do that, it's all the way to $80,000,000,000 so there's no constraint.
Nathan Latka
19:47Will you pass 10,000,000 a month you think this year at some point?
Manny Medina
19:50>> Oh, have to, yeah.
Nathan Latka
19:52Yeah, okay, good. Can you tell me the goal by the end of the year, by 2019? What would be like a stretch goal?
19:59Like 140, 150?
Manny Medina
20:03>> So the stretch goal is to get to about, I think it's like 17, adding $17,000,000 a quarter before the end of the year.
Nathan Latka
20:12So you're measuring everything really. And this is interesting to hear you talk. You're really measuring everything in terms of velocity. Right? You're So saying 17,000,000 in new bookings per quarter. Correct. It's just interesting I asked the question and you give that response versus what most people would say is we wanna break a $150,000,000 in ARR. Just it gives me a little it gives me a you know, into your psyche.
Manny Medina
20:29>> It's input metrics. Right? Like, I think about input metrics. Like what capacity do I need to generate that kind of money and everything else takes care of itself. You see what mean? I'm thinking about the output metric then I sort of forgo a lot of steps in the middle.
Nathan Latka
20:40Yeah, no, that makes a lot of sense. Okay. It sounds like you're talking or thinking about funding right now. Don't tell me obviously what you're actually negotiating, but for where you're at, right, it sounds like you have passed, and I do think this is a critical point. When CEOs get to the point where their ARR is greater than the amount they've raised, right, you now have leverage again versus the other way around, which is you've raised
20:59way more than what your ARR is. So you have really, I believe any options you want on the table. What is the right next move for you in terms of capitalization?
Manny Medina
21:08>> So
21:11>> the broader way to think about this is play it all the way out to cash flow positive or to some kind of EBITDA number. And then figure out how much money do you need to get there and then double that. And then that's your new minimum.
Nathan Latka
21:23Are you cash flow positive today?
Manny Medina
21:26>> No, no, no, no. And We're growing fast to do then we are in a tricky situation that because we're so sales driven, we have to buy the capacity at the beginning of the year, ramp the capacity, make it productive, and then that delivers a double. So every time we double, we have to sort of execute the same trick. Now that all becomes sort of self sustaining in about a year or two. And that's not even including
Manny Medina
21:44>> international, and that may put a dent in the whole plan.
Nathan Latka
21:46Manny, we have to wrap up, just realized we lost track of time. I mean, you give me a general sense of scale? Are you burning like a million net per month or 2,000,000 net per month? Where are you generally?
Manny Medina
21:54>> North of 2,000,000 per month right now.
Nathan Latka
21:55Okay. But South Of 3?
Manny Medina
21:57>> That is South Of 3.
Nathan Latka
21:58Okay. Between two and three. Good. That gives me just give you a good general sense of kinda where you're at. Let's let's wrap up here with the famous five. Number one, what's your favorite business book?
Manny Medina
22:06>> I think fast and slow.
Nathan Latka
22:07That's a good one. Number two, is there a CEO you're following or studying right now?
Manny Medina
22:11>> Oh, always be in Bezos.
Nathan Latka
22:12Bezos. Yep. By by the way, real quick, you you're in Seattle. Obviously, Amazon is up there. Henry is getting very aggressive with his nice PE from behind him. Just took out ZoomInfo. Are you in any acquisition talks with them? This would be a nice natural add on.
Manny Medina
22:24>> No, Henry. I take notes from Henry. You know what I mean? When grow up, wanna be like Henry.
Nathan Latka
22:29Well, he gave me the same process I asked you, and I'm now I'll write a big post on comparing your process with his in terms SDR to AE to CSM. All right.
Manny Medina
22:38>> Henry is a genius because he has SDR doing his expansion.
Nathan Latka
22:42No, I know. Know something else too. He has employed, and he doesn't talk about this a lot. He has employed actually external firms to run a lot of his engine. And I've interviewed a few of them. And so when you add them all together, it's like little mini SWAT teams running different tests.
Manny Medina
22:57>> That's right.
Nathan Latka
22:58Makes sense. Number number three, Manny, what's your favorite online tool for building your company besides Outreach?
Manny Medina
23:06>> I will still say Google Docs. Like, I'm I'm still very reliant on Google Docs for everything.
Nathan Latka
23:10And number four, how many hours of sleep you get every night?
Manny Medina
23:12>> How many what?
Nathan Latka
23:13Hours of sleep do you get every night?
23:15>> Six.
23:15And what's your situation? Married, single, kids?
Manny Medina
23:18>> Married with three kids. Three kiddos, how old are you? I am 45.
Nathan Latka
23:2345, last question, what do wish your 20 year old self knew?
Manny Medina
23:28>> Starting a company is not that hard, It's a lot harder than it looks. It looks a lot harder than it is.
Nathan Latka
23:33Guys, looks harder than it is. Coming from Manny again, Outreach growing fast, 3,100 customers, bookings per quarter. Now they passed last year 10,000,000 in new bookings per quarter, hoping to break 17,000,000 in new bookings per quarter by q four of twenty nineteen. That'll put them past $10,000,000 per month in revenue. They're still growing a 100% year over year even at their scale. 60,000,000 raise may be a big announcement on the way in terms of funding. We'll
23:58see what happens. Burning call between 2 and 3,000,000 per month right now, which again, is allowing them to drive so much growth. Three fifty folks on the team in Seattle, 145% net revenue retention. Super impressive. Less than one SDR for two AEs, then one implementation manager, and then again, CSMs that are incentivized by with commissions to drive expansion revenue. Interesting model, Manny. Thanks for taking us to the top.
Manny Medina
24:19>> Damn it.