How WeSoar Grew SaaS MRR from $1K to $21K in 12 Months with 4 Enterprise Customers (Interview with CEO Nisheeth Pathak)

Introduction and Revenue Overview

Nathan Latka

00:00Guys, wesoar helps you motivate your teams. They just passed $23,000 a month in revenue, up from 14,000 just a year ago. But buried under that is a lot of that revenue a year ago was consulting. Only one k was SaaS. Now almost 21,000 of this is SaaS. They went from 11 customers down to four. So they're moving away from SMB and more into larger market, larger enterprise deals. They're burning $23,000 a month in revenue with about

00:23a 100 k in the bank, so he's happy with three to four months of runway. Small team of seven, which are staying and focused on being hyper efficient in terms of acquisition. They're using word-of-mouth, AI blog posts, things of that nature. Hey, folks. My guest today is Nisheeth Pathak. He is on a mission to elevate employee experience and bring fulfillment to a billion lives. He's building wesoar.ai, which enables performance and elevate elevated experience for employees. Alright.

00:48Nisheeth, you ready to take us to top?

Nisheeth Pathak

00:51>> Yeah.

Nathan Latka

00:52Alright. Sure. So give us an update. You came on you came on a year ago, and you had just broken 10 customers. You were doing about 15,000 a month in revenue. Where are you today?

MRR Breakdown: SaaS vs Consulting

Nisheeth Pathak

01:00>> We've gone to about 23,000 in revenue, but the split has changed quite substantially. So last time we spoke, I think we were doing about 1,000 on SaaS and about 14,000 on consulting. We are now about $20 to $21k on SaaS and 2 or 3 ks on consulting. Obviously, consulting changes.

Nathan Latka

01:25Congratulations. That's exciting. It's very hard to sell an employee engagement tool when everyone is laying people off in a recession. How have you kept your churn low?

Moving Upmarket: From SMB to Enterprise

Nisheeth Pathak

01:34>> So we are actually moving upscale. A lot of customers that we did refer to in the last kind of meeting about a year ago, we don't work with them anymore because initially when the product was new, had no choice but to work in the SMB space. We no longer work in the SMB space. We are working with much larger companies in the

Nathan Latka

01:57SMB And how many enterprises are you working with?

Nisheeth Pathak

02:00>> Four right now.

Nathan Latka

02:01Okay. So you went from 11 customers down to four, but you increased revenue.

Nisheeth Pathak

02:05>> Yes, that's right. That's great. We had customers which were giving us $20 a month. So obviously it does kind of show as a count on the customer table, but it doesn't really give you much.

Nathan Latka

02:17Yep, that makes sense.

ARR Per Client Target and Pricing Model

Nisheeth Pathak

02:19>> So what we are now kind of working on is the internal target of at least 100 ks ARR per client.

Nathan Latka

02:29And you're at about 6,000 a month right now per client, about 70,000 ACV per client right now, right?

Nisheeth Pathak

02:38>> So some of the clients are at the very early stage of implementation. So I'm not counting the revenue in right now. So basically we are talking about on an average 10 ks a month for each kind of properly implemented case.

Nathan Latka

02:52And have you gotten the business to the point where it can be sustainable long term? You were burning 25 k a month last time we chatted.

Burn Rate and Funding Status

Nisheeth Pathak

02:59>> It is still about the same. Maybe it has come down to $23.24.

Nathan Latka

03:03Okay. So have you raised more money or you're still using the 205,000 pre seed round you raised last year?

Nisheeth Pathak

03:09>> There is no money better than revenue.

Nathan Latka

03:12Okay. So you didn't raise more?

Nisheeth Pathak

03:13>> No. We are not going to raise anymore.

Nathan Latka

03:15Okay. That's right. Do you regret raising the 200 ks last year at the 10,000,000 valuation?

Nisheeth Pathak

03:20>> No, I think that was more around the kind of close circle of people who trusted me personally rather than trusting the product. So that's a separate thing. We needed a little bit of money to get started. But right now, I think we are at a stage where I would very happily self fund for another six months, one year.

Nathan Latka

03:39And how many folks are on the team today?

Nisheeth Pathak

03:42>> Seven.

Nathan Latka

03:43What about the product side of things? What is it doing today? Give us a customer use case study here.

Team of 7 and AI Efficiency

Nisheeth Pathak

03:48>> So we've matured the product substantially. While I said we are seven people, we are actually doing the work of 25 because a lot of junior roles are now being done by AI. So we don't have any junior product, junior information security, junior marketing, any of those. So all of those roles have been kind of taken over by AI. Interesting. The existing people are managing. So each one of us is literally doing the work of five people

04:20>> using AI.

Nathan Latka

04:21Name a task that you've used to have someone doing a person that now is done

Nisheeth Pathak

04:27>> by AI. Information security policies, for example.

Nathan Latka

04:31Mhmm.

Nisheeth Pathak

04:32>> Right? Writing blogs. You don't need people to do that anymore.

Nathan Latka

04:37Oh, what's going on there, YouTube? Good to see you guys. Now imagine this. You love watching these interviews with SaaS founders, but imagine if we took all of the valuation data out from over 2,807 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 Founderpath. Check this out. I'll show you how you can access this in a second, but you log in, you connect

05:00your Stripe account, you see your valuation real time. You can see what it changed over the past eighty eight days and even set goals for valuation this year. Now the secret evaluation is there's many different ways to value a SaaS business. So the reason you're gonna see three or four different valuations inside of your Founderpath dashboard, this is all free by the way, is because depending on who's doing the buying of your SaaS company, you're gonna

05:24get a different valuation. A VC is gonna pay a different valuation, Private equity firm is different. If you're gonna do a minority sale, that's different. And if you sell the whole business, that's a different valuation. You can see all those when I hover over here, right? So the teal is what a VC would pay. Yellow is what private equity And red is if you sold the whole thing outright. Now what's cool about this is this is

05:46not built off random data. Again, you guys hear these interviews on YouTube. All these datas are built from real time valuation data points founder share with us on the show. So traction 1,200,000 seed round three point seven raise. They sold 22% of their business. Go in here and filter by the event. Maybe you only wanna see companies that have sold the whole business. Well, here are a bunch that have been acquired the valuation and the multiple.

06:11Maybe you're going out right now and you're raising your seed round. We'll 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 dataset of SaaS valuations than what you can get now inside of Founderpath. And we're thrilled to bring it to you. All right. We're gonna go back to the YouTube video here in a

06:34second, but if you wanna check this tool out, if you wanna jump in and sign up, you can check it out for free to get your valuation at this link. This link, founderpath.com/products/valuations. 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. Alright. Let's jump

Blog Content and LinkedIn Strategy

Nathan Latka

07:00back into the interview. Okay. So where I'm on your blog right now. What what which of these can I click on that was written by a Mission AI?

Nisheeth Pathak

07:08>> Sorry, I didn't get that. Say that again.

Nathan Latka

07:11I'm on your blog right now. Well, actually, how do I get to your blog?

Nisheeth Pathak

07:14>> You can find the blogs on LinkedIn published by the wesoar handle.

Nathan Latka

07:19Oh, I see. You don't put them on your website.

Nisheeth Pathak

07:21>> We don't actually use the website. So the website is there just for people to know that there is a website, but we don't attract traffic through the website. Every customer we are getting these days is through word-of-mouth, every single customer. And literally after the first enterprise customer, the cost of client acquisition is zero.

Word-of-Mouth as Sole Acquisition Channel

Nathan Latka

07:40Got it. Okay. Got it. I guess, so how do you go get you have four right now. How do you get more customers faster?

Nisheeth Pathak

07:51>> We are not in a hurry to get customers faster.

Nathan Latka

07:54Well, you better be. You're burning $25 a month.

Nisheeth Pathak

07:57>> So we'll cover it. We'll break even by the time we get the next one paying their

08:04>> fee in advance. So we will break even with the customer. We don't need to worry about that, which is why we don't need to raise cash urgently or anytime soon. We're happy delaying the fundraising a year or two years down the line.

Nathan Latka

08:18How much runway do you have in the bank today?

Nisheeth Pathak

08:21>> We've always had a three to four month runway.

Nathan Latka

08:24Okay. So you're comfortable operating with just today about $75,100 ks in the bank and then you're burning 25 ks a month. So that's three to four months of runway.

Nisheeth Pathak

08:32>> Because we know that there is constant kind of business coming through. It could be a one off consulting deal, which is high value.

Runway and Cash Position

Nisheeth Pathak

08:42>> So our pricing is also annual in advance. We don't have the monthly payment kind of a thing. So we get cash upfront.

Nathan Latka

08:50Yeah. I guess that makes sense. It's just how do you keep top tier talent when they know you only have four months of runway left?

Nisheeth Pathak

08:56>> We're just three people in the core team. We will not hit 10 people in the next seven, eight months. I don't need to hire more people.

Nathan Latka

09:06You don't think you can pick off the top sales rep from your biggest competitor and add customers faster?

Nisheeth Pathak

09:11>> Not right now. As I said, we are building a product that takes time and skill and love to build, we don't want to rush up and do anything which is suboptimal. We are competing with SAP, Oracle, Workday, Glint, those kinds of companies. We better be much better than what those companies offer for us to stand the chance. So we are not in a hurry. We want to take it easy. We want to go with our close

09:43>> circle of initial customers who are helping us co create the product, building the product with us. We are not in a hurry.

Nathan Latka

09:50I mean, if I'm listening to this as a listener to the podcast and I hear a founder go, we're willing to take it easy here. I imagine I would be thinking this is going be eaten alive. This company is not going to exist in two years.

Unit Economics and Churn Discussion

Nisheeth Pathak

10:00>> Your Airbus A380 doesn't take off vertically.

Nathan Latka

10:05When did you launch the business?

Nisheeth Pathak

10:09>> The kind of beta testing started happening late twenty twenty one.

Nathan Latka

10:13Okay. Okay. Got it. So over two years, you've gone from nothing to $23,000 a month in revenue and you're happy with that growth rate?

Nisheeth Pathak

10:20>> Yeah. We have grown. So if you take the last kind of discussion we had, we were at one k. So we've gone from one k to 23 ks or 22 ks in a space of twelve months.

Nathan Latka

10:33Well, you were at $15,000 is what you told me, at least, is you were doing

Nisheeth Pathak

10:36>> 15 Yes. Thousand dollars a But consulting, a lot of that was consulting and not recurring. The ARR was the MRR was about one k. So one k goes up to twenty twenty one k.

Nathan Latka

10:48You seeing healthy unit economics? Are people has anyone paid you on the SaaS fee and also canceled?

Nisheeth Pathak

10:56>> The initial round of customers, the SMB customers, we attracted a lot of those. We realized the product was not benefiting much from that association. They were using 10% or 20% of the product features. The product was not becoming any richer. So there was attrition in that lot. But in this current round, we also kind of insist on at least a two or three year contract. We don't do a month on month kind of a thing anymore.

Contract Terms and Net Dollar Retention

Nathan Latka

11:23When someone signs a three year contract with you, do you build in a natural accelerator from year one to year two of four or 6%?

Nisheeth Pathak

11:30>> We give them a discount for a long term contract. So we kind of assure them of no price increase over the three year term.

Nathan Latka

11:39Why would you do that? I mean, a key thing of building a SaaS company is net dollar retention. You handicap yourself if you basically tell them we're never going to try and sell you more or build more value for you.

Nisheeth Pathak

11:48>> We build more by adding new features, not charging more for the existing features. Right. So, for example,

Nathan Latka

11:55the other use case that you just described is what if you build new features, you can't now charge for the

Nisheeth Pathak

12:01>> No, that will be a separate sale completely altogether.

Nathan Latka

12:04Okay. So you can upsell them.

Nisheeth Pathak

12:06>> Absolutely. And in fact, a lot of focus is on getting more closer value and more closer alignment with the existing set of customers where we go very deep in our relationship with them, understand them like a true partner, and then build on the size of wallet that we have with that customer.

Nathan Latka

12:26I see. Okay. That makes sense. What other growth tactics are you trying here? Team of seven, LinkedIn's working, AI blog posts, what else?

Nisheeth Pathak

12:35>> Word-of-mouth.

Nathan Latka

12:37Okay. So okay. Pure word-of-mouth. We are giving How do you incentivize how do you incentivize word-of-mouth? How do you ask a happy customer for a review or an introduction?

Growth Tactics Summary

Nisheeth Pathak

12:45>> We ask them and they do it. We don't have to incentivize anyone. Do it because

Nathan Latka

12:50Ashish, what do you say? So is it an email after you deliver the first product spec that says, I hope you enjoyed this. Can you please introduce me to any of your other friends? Mean, specifically, what do you ask for?

Nisheeth Pathak

13:01>> So it is generally an email or WhatsApp or a phone call where we ask for reference. Some of our customers have moved on to new jobs and we are in discussions with them in their new jobs as well. So, that's how it is working.

Nathan Latka

13:17Is that a good or bad thing if a customer of yours changes jobs? Do you lose the business that they were the internal advocate for?

Nisheeth Pathak

13:24>> We always try to make the product talk, which is why the whole company should start loving the product. And it's not just one person sponsorship. And this is a fact of life. People do move on, people change jobs. You can't change any of that. You have to live with it.

Nathan Latka

13:43All right. Very good. Let's wrap up here with the famous five. Number one, what's your favorite book?

Nisheeth Pathak

13:48>> Still the Black Swan.

13:50>> All right. Black Swan.

Nathan Latka

13:51Number two, is there a CEO you're following or studying?

Nisheeth Pathak

13:54>> No. I've become a little bit illusioned with a lot of CEOs recently.

Nathan Latka

13:58Number three, what's your favorite online tool, Nisheeth?

Famous Five Rapid Fire

Nisheeth Pathak

14:02>> Currently, it's ChatGPT.

Nathan Latka

14:04Number four, how many hours of sleep do you get every night?

Nisheeth Pathak

14:07>> Six.

Nathan Latka

14:08Okay. And situation, married, single kids?

Nisheeth Pathak

14:11>> Still married, still two kids.

Nathan Latka

14:13That's good. And and and, Magnus, you had a birthday. Are you 45 now?

Nisheeth Pathak

14:17>> Yes. Recently, I Congratulations. Have

14:20>> Happy birthday.

Nathan Latka

14:21Last thing. Something you wish knew when you were 20.

Closing Recap

Nisheeth Pathak

14:25>> No. Nothing in specific. Nothing in specific. I I think in retrospect, the life I've led is a is a good life, decent life.

Nathan Latka

14:33Guys, wesoar helps you motivate your teams. They just passed $23,000 a month in revenue, up from 14,000 just a year ago. But buried under that is a lot of that revenue a year ago was consulting. Only one k was SaaS. Now almost 21,000 of this is SaaS. They went from 11 customers down to four, so they're moving away from SMB and more into larger market, larger enterprise deals. They're burning $23,000 a month in revenue with about

14:57a 100 k in the bank, so he's happy with three to four months of runway. Small team of seven, which they're staying and focused on being hyper efficient in terms of acquisition. They're using word-of-mouth, AI blog posts, things of that nature. We'll see what happens next. Nisheeth, thanks for taking us to the top. Sure. Thanks, Edwin. One more thing before you go. We have a brand new show every Thursday at 1PM central. It's called Shark Tank

15:17for SaaS. We call it deal or bust. One founder comes on, three hungry buyers. They try and do a deal live and the founder shares back end dashboards, their expenses, their revenue, ARPU CAC, LTV, you name it, they share it and the buyers try and make a deal live. It is fun to watch every Thursday one p. M. Central. Additionally, remember these recorded founder interviews go live. We release them here on YouTube every day at two

15:43p. M. Central. To make sure you don't miss any of that, make sure you click the subscribe button below here on YouTube, the big red button and then click the little bell notification to make sure you get notifications when we do go live. I wouldn't want you to miss breaking news in the SaaS world, whether it's an acquisition, a big fundraise, a big sale, a big profitability statement or else. I don't want you to miss it.

16:04Additionally, if you want to take this conversation deeper and further, we have by far the largest private Slack community for B2B SaaS founders. You want to get in there. We've probably talked about your tool if you're running a company or your firm if you're investing. You can go in there and quickly search and see what people are saying. Sign up for that at nathanlatka.com/slack. In the meantime, I'm hanging out with you here on YouTube. I'll be

16:27in the comments for the next thirty minutes. Feel free to let me know what you thought about this episode and if you enjoyed it, click the thumbs up. We get a lot of haters that are mad at how aggressive I am on these shows, but I do it so that we can all learn. We have to counter those people. We got to push them away. Click the thumbs up below to counter them and know that I

16:44appreciate your guys'support. Alright. I'll be in the comments. See you.