How Spresso.AI Reached $5M ARR with 15 Enterprise Customers by 2025 (Interview with Co-Founder Jared Yaman)

Boxed Revenue and Founder Equity at IPO

Nathan Latka

00:00My data shows December 2020 ending with about a $187,000,000 of revenue. How much equity had you guys raised up to this date?

Jared Yaman

00:06>> Yeah. I think it was around $3.03 80.

Nathan Latka

00:08$380,000,000. How much equity did you own when you guys went public?

Jared Yaman

00:12>> When we IPO ed, I was down as a startup or as a founder to low single digit percent.

Nathan Latka

00:17It looks like you're at about percent. Surely, he made more than $10.20, $30,000,000 on this company, but it sounds like that was not the case. Is that accurate?

Jared Yaman

00:25>> Yeah. It was not the case.

Nathan Latka

00:26What was revenue of spresso when you spun it out?

Jared Yaman

00:28>> We sort of brought through I'd say around 2,500,000 of ARR in early twenty twenty three.

Nathan Latka

00:33Are you comfortable sharing where you guys finished 2025 in terms of revenue?

Jared Yaman

00:37>> Yeah, it's about double.

Nathan Latka

00:39Then on 04/02/2023 you filed for chapter 11 bankruptcy there.

Host Introduction and Guest Background

Nathan Latka

00:43Hey folks, my guest today is Jared Gaiman, who's previously the co founder of Boxed. He led the company's growth and innovation in the online wholesale retail space all the way through an IPO in 2021. I think that was SPAC. As its CEO, Spresso now today deploys technology worldwide solving significant challenges in the ecommerce space. Jared, are ready to take us to the top?

Jared Yaman

01:01>> Yes, sir. Thanks for having me, Nathan. Thank you, the audience for tuning in.

Nathan Latka

01:05You bet. We're gonna mostly focus on today, but we can't do that without your background going back to 2013. Based off my research, Boxed was not a small company. I mean, when we look at year ended 2018 total revenue, net revenue, we're looking at a 140,000,000 Well, I'm I'm reading off the s one. Is the s one accurate?

Jared Yaman

01:22>> No. No. No. The trust me. They're very accurate. Yeah.

Nathan Latka

01:24Okay. Very accurate.

01:25That's the right answer,

Jared Yaman

01:26>> by the way. If your s one's inaccurate, you're in a whole lot of trouble.

Nathan Latka

01:29Yeah.

Jared Yaman

01:30>> It's it's a s1sec.gov requirements or, you know, start up visionary, you know, GMV calculations. But, yes, sir, you are correct. I appreciate I appreciate the research.

Nathan Latka

01:39This is ultimately about you. So, look, my data shows December 2020 ending with about a $187,000,000 of revenue. What happened to Boxed?

Boxed Origins: From Gaming Startup to Ecommerce

Jared Yaman

01:47>> Okay. Awesome. Yeah. Well, let me explain a little bit more about what Boxed did. So, I I came to New York. I can remember this off the top of my head. Friday, 09/12/2008 as a corporate lawyer. About thirty six hours later, Lehman Brothers collapsed. So there went my, you know, corporate lawyer trajectory and, you know, wheeler dealer in the m and a space. But stuck around in in law for a couple years and around 2010, the

02:10>> rise that that was a very significant chapter of startups. Right? We're kinda exiting the social networking, you know, Facebook, you know, Twitter, Ascendance. Right? And we we are now fully into mobile apps and sorta in that, like, max growth disruption, Airbnb, Uber, you know, fifteen years ago. It seems like it was fifty years ago at the same time and also maybe not that long ago. But, yeah, pivoted from law because I think there was a great

02:33>> affinity, one with what was, happening in venture capital and entrepreneurship, especially in New York where we're based, where, you know, you had Silicon Valley and then we're kinda Silicon Alley. They were small, tight knit. Like, meetups were huge, like going to demo days. There's a lot of excitement in. You know, our first foray, was actually in gaming. So we did a small gaming startup that essentially riffed on, what Zynga or Facebook were doing with things like

02:56>> FarmVille and CityVille. We brought that to mobile. That got a good amount of attention. We sort of cut our teeth in technology, you know, venture capital, entrepreneurship, data, data science, you know, product user experience. And we managed a a gaming company for a couple years. We exited that company. And then, you know, a year, fifteen months or so into that, we said, look. Gaming is fun. That's kinda toy aisle of life. Like, let's go for the

03:18>> big swing. Like, let's

Nathan Latka

03:19go for the whole store.

Jared Yaman

03:20>> And that's to us what ecommerce was. Right? So warehouses, fulfillment, pick, pack, and ship, last mile logistics. Like, you name it, that's what's involved in ecommerce, and that's what Boxed was. And we said, look. People are gonna look for convenience. They're gonna look for savings. Your time really matters. People are just gonna want to look. Through Gilt Group, Amazon. Right? Ecommerce was there, but as far as buying consumables, that was very, very nascent. We thought there

03:44>> was a definitely a demand for CPG. So we said, let's take what we learned in gaming and user experience and mobile interface and, you know, intuitive design and experience. Bring that to the boring stuff. Right? So not fancy clothes, not a a flash sale on a new bomber jacket from Gilt. We're doing cereal, rice, you know, all the all the boring CPG, hand soap, dish soap, sanitizer, Tide detergent. But the beauty of that was we're now

04:08>> not in charge of the, merchandising. Like, you know these you know what a Cheerio is. You know if you want it. You know a Ziploc bag. So we essentially just focused on the fulfillment, last mile delivery, the customer experience. And then we found ourselves, you know, shortly there competing with, from the legacy player standpoint, Amazon, Costco, Walmart. That's a difficult challenge. Then, of course, from the new up and comers, Instacart was the big one. And so

04:31>> we try to find our product market fit saying Instacart's doing great. We love what they do. They're very strong. And then what can we do that's different? And then we focus on centralized fulfillment, bigger baskets, b two b, and the world experience. And then it was just a whirlwind from there as far as having to work in a low margin business, taking an inventory position, operations, just making sure we were as efficient as possible and using

04:52>> technology to deliver the efficiency and, of course, enhance the customer experience. Mhmm.

Nathan Latka

04:56So what that ultimately grew again. I only have twenty twenty data from the s one. $187,000,000 top line, but the gross profit was 25,900,000 because, obviously, your cost of goods sold is you gotta move the merchandise. Right? So did was that a good margin profile back then? How did the how did the s one how did the the public filing go?

Competing with Amazon, Costco, and Walmart

Jared Yaman

05:11>> Yeah. I I wouldn't so if I were to pull my young self aside, I would say a couple things. Don't try to compete with Walmart, Amazon, and Costco. That that's or if you're gonna do that, you need to put $2,000,000,000 on the balance sheet, you need to make that a ten year journey. So we're slightly undercapitalized to to bite off, like, that big of a challenge, admittedly. And then I'll also, I'd probably say, look. This is

05:32>> the greatness of Shopify and d two c and at the same time, the rise of d two c. Right? You know, look. We all like our legacy brands. You should have seen me in high school with my Abercrombie and Fitch. Right? But, that's high margin stuff. Right? We're selling low margin grocery, trying to big bring it into digital, trying to drive loyalty, partnerships. So, inevitably, I think the best we did, we did have a profitable month,

05:53>> so it's like a giant feather in our cap. But if we were to hit a four to 5% contribution margin, that was a big win and that was pushed by every lever we could possibly pull from vendor marketing. So, at the time, you'd have to think like Procter and Gamble, Unilever, General Mills, Kellogg's. Right? They were looking at this ecommerce thing and they were like, okay, how do we get a part of that? So we built

06:16>> tools and we built experiences and we really enabled and supported them to help drive incremental margin and visibility to their product. And that took us from very much a loss losing negative contribution margin, profile to a positive in the four to 5% range contribution margin, which was really focused on people willing to pay a little bit more, pay a delivery fee, pay a membership fee, to get that extra convenience of putting those products, the boring stuff

06:40>> that you don't wanna trudge home. You don't wanna throw it in your trunk, drag it home, drag it to your doorstep. Right? We're putting that on your doorstep. People pay a premium, and we're able to eke out a four or 5% contribution margin.

Nathan Latka

06:49And, Jared, a lot of people, like, even today are playing this game. Right? Raise as much capital, go as big as you can, IPO, and then you'll just say, you know what? I'll make a lot of money when we IPO. How much equity did you own when you guys went public?

Jared Yaman

06:59>> I was, fairly diluted down. Maybe that's something that's relevant. I I love the way you bring that up because I would actually slightly push back or just enhance that by saying, I feel like we're exiting that era of growth at all cost, and and we saw that. Right? And I don't wanna I'm not saying names. I'm in a WeWork. Maybe I'm saying that name. But there's definitely that growth at all cost era from that 2011 to,

07:19>> say, like, 2015 space when people people are waiting for, like, what's the next evolution of startups gonna be? Right? And I think we are waiting for virtual reality. We're waiting for crypto. We're waiting for self driving cars. We're waiting for the metaverse. Like, all these things that, like, didn't really come until 2022, in my opinion, my little book on startups when, OpenAI launched with 3.5, ChatGPT, that essentially, to me, like, dragged forward, like, six years of

07:46>> startups. But at the same time, to me, it sort of closed the chapter on growth at all costs, you know, bringing maximum amount of capital, burn cash, spray and pray, just try to figure things out as you go, fail fast, you know you know, close down a $50,000,000 p and l or business unit. Right? I think that era is a bit by and gone. But I think, yeah, when I when we IPO ed, I was down

Margin Profile and Contribution Margin at Boxed

Jared Yaman

08:07>> as a startup or as a founder to single digit percents, low low, percent, single digit percentage. But that was okay because we loved the challenge. We enjoyed building the technology. We we really enjoyed the the momentum we had with our partners and and growing the business. But as I sit here today, you know, maybe relevant for some of the founders is I feel like we're almost in, like, bootstrap era. Right? Capital efficiency, do more with less,

08:30>> you know, leverage AI to be maximum, efficient in that twelve years ago approach at, you know, growth at all cost and burn VC cash. I'd say it's a little bit in the rearview mirror.

Nathan Latka

08:39We're looking right now at the s one filing, the key ownership percentages. It looks like you're at about 1,700,000.

Jared Yaman

08:44>> Yeah.

Nathan Latka

08:45Yeah. You're at about 2.6%. How much equity had you guys raised up to this date?

Jared Yaman

08:48>> Yeah. I think it was around $3.03 80.

Nathan Latka

08:50$380,000,000.

Jared Yaman

08:52>> Yeah. Yeah. We raised our first, $100,000,000 round in, I think, December 2015.

Nathan Latka

08:59Guys, remember, I am not just a YouTuber. I'm investing into my third fund. We've deployed $250,000,000 into 550 software companies so far, Again, at founderpath.com. If you're interested in capital, I would love to cut you a check because I know you're investing in your education. You watch my show. So sign up at founderpath.com and when you get the onboarding email, I reply and I see all those. Just reply and say, Nathan, I found you through YouTube,

09:22and I'll make sure to prioritize you. I would love to cut you a check. Check out founderpath.com. Well, so, Jared, I have to ask because, again, so many founders get stuck in this trap. Did you take I mean, I care about founders building personal wealth, building companies they love with customers who they love backing. If you don't take money in the early rounds, you end up really stuck with no way to actually personally get liquidity. Did

09:40you take any secondary early on, or were you sort of screwed at the end?

Jared Yaman

09:44>> Yes. I don't wanna lose any listeners. Don't follow Jared's model. Well, if possible, learn from Jared. So look. We enjoyed the ride. I'm a tech guy, data guy, like building technology products, but we took pretty much all of the capital that we brought in, and we deployed it for growth and expansion. And then also, you know, when you're being really honest with yourself, it's like, well, how do you put a dollar amount to the learnings that

10:07>> I have, the team that I've sort of built around me, the network that I've built, the relationships, that I have? And you can tell, I'm sorry I didn't come, you know, super suited and booted and dressed up, but I'm a pretty no frills guy. So I would love to give advice, like, to the audience and say, don't do the move of, like, founders eat last. I also think that's old and antiquated, but you have to understand

10:28>> your worth. And there's lot of thoughtful people out there that say, like, look. If you're showing a certain amount of p and l or you're showing your let's let's take a smaller start up, but, you know, maybe more of a bootstrap company and it's, oh, we're we're cash neutral or we have a, you know, 5% EBITDA or whatever it is. Oh, but the the leadership is taking zero salary, Well, you're still unprofitable. Right? So let let's

Founder Dilution and Secondary Liquidity Lessons

Jared Yaman

10:46>> not play those games. And, of course, we all understand the mental stress, that goes into it. People that have families, you have college tuitions to pay. But I definitely think, you know, going forward, the the pendulum has sort of swung, I would say, in favor of founders. There are mechanisms out there. Secondary is a great one to say like, hey. Get what your work is so you can focus on growing the business and not having to

11:05>> refinance your home or borrow cash from insiders or whatever the whatever else we've been doing for the last twenty years as entrepreneurs. Hopefully, people can take a a little bit of a lesson away from that.

Nathan Latka

11:16So, Jared, just to sum that up, one word answer if you can. Many people would look at Box and say, Jared was a cofounder. He grew it to hundreds of millions of revenue. They raised 380,000,000 total. Surely, he made more than $10.20, $30,000,000 on this company, but it sounds like that was not the case. Is that accurate?

Jared Yaman

11:31>> Yeah. It was not the case. But look, man. I love networking. Like, let's hang out. I'll I'll pick up the tab. Don't worry about it. I think also part of it is you have to believe in yourself, and and you don't and not to go all cliche on you, but, like, penny wise, pound foolish, and things like, don't let a dime hold up a dollar. You don't wanna make short term decisions if you feel like it

11:49>> can pay off, in the long run. I wouldn't recommend anyone sort of manages it the way that I did. But at the same time, you have to sort of look at it holistically as far as the experience you're getting, the teams that you're leading. I was able to bounce around from leading merchandising, customer service, leading tech teams, leading operations. Like, I pretty much saw everything. And to say, if you think about your future earnings, as long

12:10>> as you can stay healthy, right, let's get the mental and the the physical stress out of it so you can stay a healthy person that in the long run, I feel like I've probably monetized more than trying to cash out for x amount of dollars based on what was a unicorn public company that I was on the on on the board of. But, you know, so less about the monetary dollars where possible. I mean, different situation

12:30>> than lot of other people, so I wouldn't wanna dissuade anyone from saying, no. I need to be taken care of. I'm worth this, so I deserve this. That is a very fair, approach.

Nathan Latka

12:38There were many years where you guys, from a net income perspective, lost more than $30,000,000. Did you ever consider shutting the company down?

Jared Yaman

12:45>> Sorry. That was tough to tough to rehear. Yeah. So look, it was growth. Lots of learnings of inefficient marketing. I feel like we we marketed towards the customer we wanted to be a boxed customer versus the customer who actually was. That creates marketing inefficiency. You know, we had a lot of success with rural customers. A lot of people maybe that were into junk food and things like that. Is many, many pre COVID, years ago, maybe less

13:13>> focused on health than we are now. But I think there was a lot of experimentation in marketing, a lot of also just start up efficiency. You know, we built a robotics unit that, like, worked and was successful, but we were buying NVIDIA before NVIDIA was, like, super cool. We were buying Jetson GPU. So expensive things that you would do to kinda, you know, be a player in startups that, you know, there was a lot of learnings

13:35>> from in the course if with a different approach, I would say, we are now, definitely more capital efficient. But, yeah, definitely, there was an excessive burn rate, and the best we could do is apologize to the to the VC somewhat and then also learn from it.

Nathan Latka

13:49Jared, there's lot of folks saying, look. Software, anyone can build it now. It's hard to compete. Go back into the old school, like unsexy stuff. There's people pivoting. You guys in 2021 while your your your retail revenue decreased by $26,700,000 in the first nine months of twenty twenty You guys had a bright shining star, though, as you pivoted to some software, which contributed about 15,000,000 revenue, and you're now obviously doing exclusively software. We're gonna jump in

Pivoting from Retail to Software Inside Boxed

Nathan Latka

14:10that in a second. Just help me understand, though, internally, what's it like to move a $180,000,000 revenue ship from low margin retail sales to higher margin software sales?

Jared Yaman

14:19>> Yeah. I don't think we quite got there. So it is difficult as far as making, you know, turning around the Queen Mary, in the harbor. You know, there was, investors, right, that, you know, bought into the SPAC, right, into the despack, into the go public process, debt providers in a thesis, right, that they need to be accountable to their investment committees, to their LPs. It's like, this is a retail business. This is gonna be, the gen

14:41>> z millennial version of a Costco. It's gonna be, you know, ecommerce enablement and convenience and essentially like Instacart meets Goldpuff, and we're gonna be right there, with them. So you can't just say, oh, hey. At the next board meeting, hey, guys. Change in strategy. We're not just gonna be a software company. However, I do feel like we built some of the best ecommerce software in the world. You know, I'll be very humble about many things, but

15:02>> I will definitely believe that the the ecommerce, platform that we have is very competitive with anything, DoorDash, Instacart, Walmart, like, name it. We have that level of technology platform. It's just more difficult than you would think to sort of pivot that story, to a software story. But that's what Spresso is today. Right? It takes time, but we've really skinnied up. We've built with our partners. And I would just say we have a a retailer, top 20

15:27>> retailer in the world. They looked at everything. They looked at using Amazon, Rocky ten, local providers, in house solution, and they chose the spresso solution because they did see that it's a superior software platform. But it's not an overnight transition, and I would say we're probably in year three of making that transition. So it definitely takes time.

Nathan Latka

15:45Well, let's close the door on Box then go into espresso all in. The Box story is you raise $380,000,000 of external capital. You go public. You do hundreds of millions of revenue. But then on 04/02/2023, you guys file for chapter 11 bankruptcy there. You then obviously move into espresso. Walk me through the bankruptcy and the pivot into espresso. Espresso.

Boxed Chapter 11 Bankruptcy and the SVB Collapse

Jared Yaman

16:05>> Yeah. Yeah. Bankruptcy. I will probably get this wrong. They everyone can fact check me, but for some reason, think it was Mark Twain that says bankruptcy happens, like, super, super slow and then all at once, and that's exactly what I saw. So we did go public via a SPAC. So we were kinda in the public markets, maybe over our skis a little bit, not fully ready to be there, whether that's from a KPI standpoint, growth standpoint,

16:28>> or just fundamentals standpoint. So that created a very turbulent 2022. You then touched on the extra complexities, right, as we believe that, hey, The software business is the future. We're not gonna be able to out supply chain, out trucking, out logistics, out warehouse, you know, Walmart and Kroger and the major retailers, in The US, especially with consumables, but we still feel like we can, you know, out technology them. So trying to make that transition was difficult.

16:52>> And then, you know, as I mentioned, it was something that was, like, slow, slow, slow, breach of covenant, you know, forbearance on the covenant and the promises. Uh-oh. It's looking, you know, not so hot for us. And then in 2023, it was like slow, so slow, and then boom all at once. And then we spun out spresso, as the new co bringing over, like, the IP, the technology team, and then, of course, the major partnerships to

Spinning Out Spresso.AI from Boxed

Jared Yaman

17:13>> sort of give us that, fresh start. But, yeah, I would I would say it's a giant learning experience, but one of the few learning experiences that you really appreciate it, you know, you had to go through it. It makes you tougher. It adds skills, but you never wanna do it a second time. So that that would be my

Nathan Latka

17:28In the postmortem, there were a lot of folks that yes. All the things you just said are true, but the big the final nail was was actually right around the Silicon Valley Bank Collapse because you guys had a majority of your cash deposits and liquid assets there, and that just made it really hard for you guys to Yeah. Try to get out of the covenants. Was that true or not?

Jared Yaman

17:42>> Partly. I would never sit here and tell you or your audience that, oh, it was because of SVB. You know, we had our own fundamental issues that we were working through and dealing with. But when you just kinda, like, sit back and say, like, oh, I I think there's a the higher power talking to us or, like, we're getting signals. It's like, that that is like, oh, that's like the last straw that we cannot really deal

18:01>> with. Because, yeah, sure, that could have been, you know, a $50,000,000 bridge loan or something like that. Could that could have seen us through and, like, that avenue is closed. But, you know, pretty impressive how SVB has turned it around. I would bank with them again. Timing. You know, a lot of things come down to timing, so it was definitely not SVDs fault, but we were caught up. I was not knocking on the I remember, like,

18:21>> people were rushing to the bank, like, you know, trying to pull funds and all the investors and all the board members are, like, picking up the phone. You You know, it wasn't that chaotic for us, but it was just like another signal of, like, wow. This is an uphill battle, and I just don't know if we're gonna be able to get through it.

Nathan Latka

18:34Alright. How do you spend spresso, a high margin promising SaaS tech business? You're licensing to major ecommerce brands like Aon. How do you spin that out of box in a clean way? And what was revenue of espresso when you spun it out?

Jared Yaman

18:45>> Yeah. So I will and, again, we had great advisers, great lawyers, smartest people in the room, like that whole thing. But there was definitely a feeling and also working with partners, like, you know, who we host on servers. And I will say one thing we're super proud of was we had no downtime. Right? So you're going through a restructuring. It's like, who's paying the server bill right now? Like, does the website still load? So we're able

19:06>> to navigate that, and I think that was, a giant win for us. But despite having the smartest people in the room, heavy, you know, high horsepower legal teams and advisers, it felt like we were writing the playbook versus, like, following a playbook. Like, following a playbook, like, hey. Look. It happens. Public company back to private. Chapter 11. Delaware law solidified this for, you know, half a century or more than that, and here's what you need to

19:27>> do. I felt like we kept running into situations where we weren't just, like, adopting a playbook. We were writing the playbook, which add extra added extra complexity for sure, But we were able to maintain uptime, maintain our service levels. I think we're super proud about that. Of course, as a company, we're a worldwide company with a a strong technology team, you know, all all throughout the world. Right? We need to provide 24, seven service. So for

19:50>> us to be able to, you know, maintain the the customer experience that we're obligated to, without any, downtime or major issues was was hugely important. And then we sort of brought through, I'd say, around 2,500,000 of ARR in early twenty twenty three. And then, you know, again, I mentioned, you know, we were in charge of warehouses, warehousing technology, fulfillment technology. Right? We did open up some capacity to take on a few more projects, and that really

20:13>> motivated the team. Right? We had to keep the team motivated, committed, excited, excited about what they're building, excited about the vision of what Spresso would be now as a, much different, you know, espresso than the public company, box. So we were able to land a few deals with major, brands and logos there, right when that transition was happening. I think that was sort of the glue that kept a lot of things together.

Nathan Latka

20:34Jared, but your story's unique. Right? I mean, most people have a cofounder they split equity with. I mean, I'm sure that the company didn't just give you a 100% of the spinout espresso with 2,500,000 of AR just for free. Right? Are the is the parent company still on the cap table there? Like, how did you actually get it structured?

Jared Yaman

20:46>> Yeah. So the essentially, the parent company, the the SPAC acquirer, like that whole thing that you would see in the s one, that really all went away. Like, went to trustees and, like, all this very difficult chapter 11 restructuring. However, the only reason the spinout happened was credit to BlackRock. So BlackRock had put in a debt instrument into the IPO process. BlackRock believed in the team. They believed the technology, the relationships that we have built. So

21:10>> working with our number one customer, right, we had to make sure they were onboard. That's EON, as you mentioned, and then making sure BlackRock was comfortable. They facilitated the the spin out, and then it's been in that next couple years, we work with BlackRock very closely on setting up, like, a new cap table, new ownership structure, debt structure, all of that. And we're still kinda working our way through that as we sit here today. But, luckily

21:30>> for us, I think we've made it through the worst and the technology is going well. I think customers are happy. We're growing and we're very excited about what the future is for us.

Spresso Customer Count and Contract Sizes

Nathan Latka

21:38How many customers are you guys serving now today?

Jared Yaman

21:41>> About 15.

Nathan Latka

21:4215. Okay.

Jared Yaman

21:43>> Yeah. But that's from say 20,000 ARR to X amount of millions of ARR. So it's a, it's a pretty giant, kind of bell curve there for.

Nathan Latka

21:54So it's, so it's fair to say you have customers paying you more than 2,000,000 per year?

Jared Yaman

21:57>> Yes.

Nathan Latka

21:58That's incredible. Okay. So how do you price? What do you price against? I'm gonna share the screen here where we so as you talk about this, people can see your product. But how do you price?

Jared Yaman

22:05>> Yeah. I mean, there's learnings there. I think a lot of SaaS people don't feel like they never get their pricing correct. I think I I listened to a podcast, from the Zapier team, and they're like, our pricing literally from, like, the free tier to the, you know, user tier to the business tier to the enterprise tier was, like, the Fibonacci sequence. I don't know if any really SaaS founders ever fully satisfied that they priced correctly. So

22:25>> we've tried to learn there to and and simplify it, but we've gone from, you know, implementations, also, like, a modular approach where, say, our grocery experience costs x, the b two b experience costs y, and then our markets marketplace experience costs z. And then, of course, we get monthly subscriptions. So, there's definitely a lot of variance there, but it's not as simple as you might think as just saying like, hey. It's x amount of dollars per

Pricing Model: Modular SaaS and Implementation Fees

Jared Yaman

22:47>> month. It really goes into, we wanna deliver the best platform for the customer and their needs and also their expertise and their feedback, you know, from their end consumers. So that goes into discovery, making sure the platform is the best, for them, and then, we can sort of scale it up from there or scale it down as necessary.

Nathan Latka

23:03And so how have you scaled since 2023 with 2,500,000 of ARR? Are you comfortable sharing where you guys finished 2025 in terms of revenue?

Jared Yaman

23:09>> Yeah. It's about double.

Nathan Latka

23:10Oh, wow. Okay. I mean, are you happy with that?

Jared Yaman

23:12>> You're never happy. It could always be better. And I would say there's advantages there because some of the conversations that led to that increase in ARR had been preexisting. So, you know, that wasn't like starting fresh and clean or from scratch and, you know, dialing for dollars or picking up phones. Like, there was using networking, founder led sales, like a lot of tactics. We were able to sorta get a lot of conversations over the hump, to

23:33>> sort of hit that next tier of growth.

Nathan Latka

23:35And I'm obviously you know, I run a debt fund. So anytime I have the opportunity to talk to an early stage founder like you about debt, I do it. Can you tell me how you structure debt on this business with 5,000,000 ARR? Is it

Debt Structure, Interest Rate, and Warrants

Jared Yaman

23:43>> a term loan? Is it a

Nathan Latka

23:4413% interest rate? Are there warrants? How'd you structure

Jared Yaman

23:47>> Yeah. Could be a modest amount of warrants with the relationship with BlackRock. Here's what I do. My super, you know, basic target would say to keep the debt or keep the leverage less than 10% of ARR, and then 10% has sort of been our standard interest rate. And that's something that actually sort of came from BlackRock.

Nathan Latka

24:06>> With warrants.

24:06Right, Jared?

Jared Yaman

24:07>> Yeah. Warrants should be in addition to to that. So another single digit yeah. An an equity position of and, again, less than 10%, but in warrants in addition to the debt also under 10%. So

Nathan Latka

24:19to sum all that up, you're at 5,000,000 of revenue. You keep your leverage under 10% of revenue. So you have less than $500,000 of debt on the balance sheet today. That way that debt is structured is about a 10% interest rate, but the the lender also has, you know, under 10% sort of an equity position in the company as well.

Jared Yaman

24:33>> Yeah. That's exactly correct. Said much more succinctly and better than me. And then also with our enterprise contracts, they tend to step up year over year. So that helps us, sort of keep the leverage down. And then I think we're in a really good position now to think about bringing in extra capital for growth. We think we're humming along. We worked on some major projects. They're performing very, very well. We're seeing the the fruits of that

24:54>> labor and those initiatives, with with our customers, you know, beating targets in 2025, which is an incredible achievement in e commerce. It's not that easy to surpass, e commerce, targets. So, yeah, that definitely has us thinking like, hey, back to that question, it's great to have a leaner balance sheet, but we don't want to also growth and leave ARR and and on the table because we aren't investing in growth. And just to kinda tie it together

25:19>> a little bit, you mentioned how difficult, like, that restructuring was or going from a retailer operator warehouse supply chain company to a pure software company. There's about eighteen months of heavy engineering work to make the platform leaner, skinnier, you know, skinnier infrastructure, more deployable. What used to take, say, four months to deploy a platform is now down to like four weeks or less. So now we really wanna benefit from, you know, all that extra effort to

25:45>> to make the platform as accessible as possible and make the iteration as fast as possible because things are moving quickly and customers are demanding more and, you know, everyone wants AI on the platform, you know, everything that goes with a better shopping experience. We wanna move quickly. So, taking in an extra amount of debt, perhaps tripping the 10% boundary, just something that's the job of the leadership team. Right? Is that the right decision to make?

Platform Engineering and Deployment Speed

Nathan Latka

26:06Jared, wrapping up here. If somebody offered you 10 x your ARR, so 50,000,000 all cash upfront today to buy the business, do you sell?

Valuation Multiples and Exit Considerations

Jared Yaman

26:13>> Yeah. Do you have their phone number? No. I I you know, because so I exited a company via m and a and, through IPO, through public markets. You know, a lot of it is in the details of the other terms. I would say that sounds a bit frothy, to be honest. Like, we wanna give actual financial information, to people. I would say more to ARR, probably more like the six or seven range. And then it's really

26:36>> just about, you know, what level of participation, what's the GTM, what's the growth plan, like, who are we calling next, where are we deploying? We'd love to expand to Europe. We love to dominate, emerging markets. So there's a lot that goes into it because, again, like I mentioned, rate at the beginning of the call, it was really not always about a monetary outcome. A lot of other things we could do if we just wanted, the monetary

26:55>> outcome, but, I would probably caution people that in our business, a certain type of business, the the multiple is probably more in the six or seven range.

Nathan Latka

27:03Guys, there we have it. Jared Yehman. Check him out. Espresso.a I cut his teeth back at Zynga. Left Zynga launched a little app in the gaming world. Said let's apply gaming to, like, Walmart, basically. Launched box.com in 2013 trying to compete with the big dogs. Margins were tight, but they grew top line. It looks sexy. 2020 finished up with a 187,000,000 top line, but only 25,000,000 of gross profit. So tight margins. They lost about $34,000,000 that

27:26year. Ultimately, though, did have a successful IPO via SPAC. They tried to grow it, but they just could not get the margin profile to work. Ultimately, shut that down, filed for chapter 11 bankruptcy around 2023, but a bright spot in that company was the software component. Jared then took hold of that, spun it out, partnered with BlackRock in 2023 with $2,500,000 of ARR. Now fast forward to today in 2025. We just wrapped 2025, over $5,000,000 of

27:49revenue scaling nicely. They've got 15 customers ranging from $20,000 a month all the way up to 2,000,000 plus. So clear enterprise motion here will be fun to watch them scale. Follow along at spres s o dot a I. Jared, thanks for taking us to the top.

Jared Yaman

28:03>> Thanks a lot, Nathan. Appreciate the time.

Nathan Latka

28:04You won't believe this CEO's revenue. Click here to watch the next episode right now.