Insight
Infrastructure SaaS yields 20-30% margins while end-to-end apps exceed 70%
“So the infrastructure-ish SaaS company, they intend to have around 20 to 30% margin, but if you go to end-to-end application, they tend to have more than 70%”
Insight
Early-stage startups should build apps over platforms for GTM control
“As an early stage company, end-to-end apps is much better way to go to market, especially because you have more consistent and predictable sales and marketing motion, and also you can control the entire sales process.”
Assertion Not checkable as stated
A Treasure Data VP tried to fire CEO Kazuki Ohta over pivot
“One VP were not convinced of this direction. So he came to the board and trying to fire me.”
Insight
Becoming a $1B+ platform requires building your own native killer app
“So what I found out was if you become a truly you know, one billion dollar plus platform company, you really need a killer application by yourselves.”
Insight
Investors buy platform stories, but enterprise customers buy apps
“The investor really likes the platform story to be told, and you can keep talking about the platform for the right audience, but that's not how customers will purchase or fund the project.”
Assertion Not checkable as stated
96% of Treasure Data's early ARR came from two founder-led deals
“Ah, but in reality, we closed 3.6 1000001.2 million ARR deal led by founders. So if you look at this, 96% comes from these like two gigantic deals led by founders.”
Assertion Not checkable as stated
Top 5 customers represented 95-97% of Treasure Data's Series B revenue
“Top five customers consist of more than 95 to 97% of the revenue, so that was a huge concern from series A and series B investors, of course, right?”
Insight
Platforms have higher switching costs than easily swappable end-to-end apps
“Platform side, it's more difficult to be replaced because you're just becoming the foundation for the customer's business, while end to end up, you can pick up the competitor and replace quickly”
Assertion Not checkable as stated
Treasure Data shut down a $1M ARR enterprise product to pivot
“And also, we had a really good traction on the open source side, which is Fluentd, so I built the enterprise open source Fluentd product, and we also spent a lot of sales and marketing data to this product, and this line of business went from zero to one milli…”
Disclosure
Treasure Data grew from $25M to $100M ARR in three years
“Again, we grew from 25 to a hundred million dollars in three years.
Our growth rate got accelerated from 20 to 30% to 70% plus.
Our gross margin got hugely improved to late seventies.”
Insight
Billion-dollar enterprise apps eventually must expand into platforms
“If you want to become a truly enterprise billion dollar unicorn, you have to think about, okay, what's the adjacent areas you can expand? What's the common layer you can have within the product? So going from app to platform.”
Assertion Not checkable as stated
Treasure Data scaled from $0 to over $100M ARR in 10 years
“And we grew from zero to a hundred million ARR plus in last 10 years.”
Assertion Not checkable as stated
Treasure Data scaled from zero to $5M ARR in two years
“We grew from zero to five million ARR in two years.”
Assertion Not checkable as stated
Treasure Data reached $10M ARR in three years
“And we grew from zero to three million five million that are in two years, and then we became ten million dollar in three years.”
Disclosure
Ohta: Only One Early Treasure Data AE Hit Quota Consistently
“All of the account executives we hired, only one of them could have consistently hit the target, but of course, with the help from the founders.”
Disclosure
Big Tech cloud offerings wrecked Treasure Data's SaaS metrics
“We observed all of the important SAS KPIs were suddenly about to go wrong.”
Assertion Supported
Snowflake raised $1B+ to fight Amazon and Google on price
“There was a similar company called Snowflake Computing. So they took a route of two by raising one billion dollar plus.”
Assertion Not checkable as stated
90% of Treasure Data's early customer workloads came from marketing
“Based on our observation and then interview with the customer, turned out on top of our data platform, 90% of our customers were analyzing customer data, including the data coming from web and mobile and social and CRM. And even though our counterpart was a te…”
Assertion Not checkable as stated
20% of Treasure Data's ARR remained in its legacy platform
“And in fact, we have 20% of our ARR still coming from big data product, but we're not, of course, adding new customer for that segment, right?”
Disclosure
Treasure Data's average deal size stabilized at $350K to $400K
“The platform deal we did, we had a couple of seven-figure deals.
But now we're closing 350 K to 400 K a year as an average.”
Disclosure
Treasure Data open-sourced its log collector to drive proprietary cloud adoption
“We decided to use open source as a way to get more adoption initially, because once you install this log collector, using treasure data was instant, right? So using open source as a way to generate the lead initially, but we keep our differentiation as a propr…”
Assertion Supported
Ohta: AWS Released Redshift During Treasure Data's Early Years
“At year two to three, AWS released new product called Amazon Redshift, which is the cloud data warehouse product at AWS reInvent.”
