Sep 13, 2024 · 45m · sourcery
Zamp's Series A: $14M in 15 Months · Sourcery with Molly O'Shea
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of Sourcery, host Molly O'Shea interviews Rohit Badangay, Founder and CEO of Zamp, discussing how the startup achieved 6x year-over-year revenue growth, raised a $10M preempted Series A, and built an automated sales tax compliance platform for e-commerce and SaaS businesses.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Molly holds 14.6% of the talking time here. How this is scored →
Molly as informed peer 3.1 Guest teaching 3.7 Guest disagreement 1.5 Molly pushing back 1.1
speaking balance: gold is Molly, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 39:40 Founders not working hard enough
Rohit openly rejects typical startup work patterns, arguing that 40-50 hours a week is insufficient given fiduciary and employee responsibilities.
Hardest push from Molly ▶ 22:10 Pushback on consumer brand awarenessMolly playfully ribs Rohit for being disconnected from consumer brands when he admits not having TikTok or knowing Cult Gaia's popularity.
Biggest teaching moment ▶ 17:15 Deep dive on Wayfair Supreme Court rulingRohit comprehensively explains how the 2018 South Dakota v. Wayfair ruling suddenly made millions of digital merchants liable for state sales tax.
Molly holds their own ▶ 31:30 Calling out predatory pricing modelsMolly astutely guesses and mocks per-dollar tax fee models, prompting Rohit to confirm and criticize competitors for doing exactly that.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Molly as informed peer | Guest teaching | Guest disagreement | Molly pushing back | Why |
|---|---|---|---|---|---|---|
| Zamp's $10M Series A Round & Preemptive Fundraising | 3 | 3 | 1 | 1 | Molly kicks off the conversation politely asking about the mechanics and lead of the Series A round. Rohit provides a comprehensive narrative on preemptive terms and the current tough fundraising climate. | |
| Existing Investor Strategy & Partnering with Valor Equity Partners | 4 | 2 | 1 | 1 | Molly demonstrates familiarity with venture funds and noteable investors like Day One and Soma Capital. Rohit explains how Valor's multi-stage checks and operational support made them a natural fit. | |
| Origin Story: From Finance to Uncovering the Sales Tax Opportunity | 2 | 5 | 2 | 1 | Rohit details the origin story of discovering sales tax compliance gaps in portfolio companies while at Pareto, schooling the audience and host on the duopoly of Avalara and TaxJar. Molly offers an offhand remark about VCs falling into VC, which Rohit briefly questions. | |
| Sponsor Announcement: Archer eVTOL Air Taxis | 2 | 7 | 2 | 1 | After an ad break, Molly asks how large the sales tax problem is, and Rohit gives an in-depth breakdown of the 2018 South Dakota v. Wayfair Supreme Court decision that transformed ecommerce tax obligations. | |
| Ideal Customer Profile & Key Clients | 4 | 1 | 1 | 2 | Molly playfully teases Rohit for not using social media when he admits not knowing Cult Gaia was a major brand, showing her own domain familiarity in consumer retail. | |
| Go-To-Market Strategy: Inbound Education & Partner Channels | 3 | 3 | 1 | 1 | Rohit explains how inbound education and strategic accounting partnerships drive their customer acquisition with rapid onboarding times compared to legacy providers. | |
| Zamp's Team Composition & Domain Expertise | 3 | 2 | 1 | 1 | Rohit discusses staffing across revenue, engineering, and tax compliance, reiterating growth metrics and achieving mid-seven figures ARR in 15 months. | |
| Business Model & Subscription Pricing | 4 | 4 | 2 | 1 | Molly jokingly asks if Zamp charges a fee on every tax dollar processed. Rohit confirms that competitors actually do that and calls the practice bonkers, validating Molly's intuition. | |
| Acquiring the Zamp.com Domain Name | 3 | 6 | 1 | 1 | Rohit shares how they acquired four-letter domain names speculatively before launching into an educational overview of the national CPA shortage and accounting industry M&A. | |
| Founder Work Ethic & Responsibilities | 3 | 4 | 3 | 1 | Rohit strongly argues that most founders do not work hard enough and defends putting in 70-90 hour work weeks to compress iteration cycles, before ending on a lighthearted tennis rivalry note. |
Statements from this episode (21)
Zamp raises $10M Series A led by Valor Equity Partners
“Raised about, yeah, raised ten million dollars. That brings our total funding to about fourteen million dollars. And yeah, I mentioned like it was led by Valor Equity Partners.”
Badangay: Early multi-stage VC backing aids future fundraising rounds
“If you can get a multi-stage VC in really early, it could really help your fundraise processes down the line too.”
Valor Equity Partners writes $1M early checks to preempt Series A rounds
“They have a program where they put in, you know, a million dollar check type thing pretty early on into businesses. And then if they're really excited about it, they'll come in and lead their air round.”
Avalara and TaxJar abandoned SMB market after acquisitions, says Badangay
“One of them was Avalara, which was, had been acquired by Vista Equity, this private equity group for about 8.4 billion dollars. And then you had Taxjar, which got acquired by Stripe for you know, close to a billion dollars as well. And with these acquisitions,…”
Badangay: Zamp Recruited Early Employees From TaxJar and Avalara
“So we had some of the, probably like our first five hires or some of the, like probably the first, 20, 25 hires from either texture or Avalara.”
Pre-2018 e-commerce and SaaS companies did not charge sales tax
“Before 2018, e-commerce and SaaS companies, they did not have to charge their customer sales tax.”
Bhadange: 10 to 15 million US merchants must now manage sales tax
“You're looking at about like, I don't know, 10, fifteen million merchants just in the U.S. That now have to deal with sales tax and never had to deal with it before.”
Bhadange: Legacy sales tax software takes 20 to 50 hours monthly to manage
“These legacy software providers, it could take you 2040, 50 hours a month just to manage.”
Badangay: Zamp targets e-commerce and SaaS companies with $1M to $200M revenue
“The pain point is just the highest of the e-commerce SaaS segment, but specifically within these like one to two hundred million dollar revenue businesses.”
Badangay: Zamp onboards in 1–2 hours versus weeks for legacy providers
“This onboarding process typically takes, you know, an hour, two hours tops. When you compare that to industry average for somebody to get fully set up running sales tax for the following months with legacy providers, it's like weeks, sometimes months, if you'r…”
Zamp reduces monthly sales tax management time to 5 minutes
“Typically customers are spending, I don't know, like two to five minutes a month managing the sales tax. And then beyond that, on the backend, our team, people, technology, automation kind of take care of everything else. And so for the customer, now they go f…”
Badangay: Putting engineers in front of CFOs for tax questions erodes trust
“I think if you just had a team of engineers and you know, somebody had a question, like a very specific sales tax question, or they're like, Hey, where did you get this rule from? And a lot of times you're talking to controllers on the other side, CFOs, financ…”
Zamp reaches almost 400 customers in 15 months since launch
“From a customer level, we're now working with almost 400 customers, and that's just in 15 months.”
Rohit Badangay: Most Zamp customers switch from legacy and newer competitors
“Most are switching over from existing providers not just legacy providers, but even some of the newer ones that we're seeing out there.”
Zamp reaches mid-seven-figure ARR with 6x YoY revenue growth
“And I think a year after, I think year after launch, or I guess like year since today, we're at almost like, what, six X revenue. So we're hitting mid seven, seven figures. They are growing pretty fast.”
Badangay: Competing tax platforms charge processing fees on dollar volume
“We have competitors that do that. And I think it's actually bonkers. Yes. They usually say, Hey, listen, They charge you not just a plat, they'll charge a platform fee, and then they'll also charge you a process, like basically a stripe processing fee type thi…”
Badangay: Zamp prices by state count and API transaction volume
“Our pricing is pretty simple. It's just based on how many states you need compliance in. So we have a, you know, a seven state tier, a 14 state, 21 states, 28, all the way up to a full coverage. And then beyond that that's for customers that use our platforms.…”
Zamp launches Ztax, a white-label sales tax tool for accountants
“We just recently launched with this fundraise, a new product called Z tax. Z tax is a solution for accountants and bookkeepers.”
Badangay: Most startup founders do not work hard enough
“I generally agree. Most founders don't work hard enough. A lot of founders I know work like 40, 50 hours a week, which I think is kind of crazy.”
Badangay: 80-hour workweeks cut a year of progress down to 4-6 months
“If you're working, you know, average 80 hours a week versus somebody that's working 40 hours a week, whatever that takes them one year to figure out, it will take you four to six months.”
Badangay: I do not expect Zamp employees to work 80-hour weeks
“While I work those kinds of hours? I don't necessarily expect my team to work those hours. I don't ever tell my team, Hey, you need to work this. You need to work that. I think we just, we're more deliverables focused and it's like, Hey, this is what we need t…”