Apr 16, 2024 · 22m · top-founders
This Danish CEO Hit $30m ARR using Unique 14 Hub Model Selling Software for Microsoft Ecosystem
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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 interview with Nathan Latka, LMS365 CEO Rasmus Holst details how the company scaled from a Danish IT consultancy into a $30M+ ARR SaaS platform natively integrated into Microsoft Teams. Holst breaks down their unique 14-hub sales model, disciplined Series A financing, Weekly 10 acquisition, and the transatlantic leadership mindset driving their expansion toward $40M ARR.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Nathan holds 30.6% of the talking time here. How this is scored →
Nathan as informed peer 5.1 Guest teaching 4.6 Guest disagreement 2.3 Nathan pushing back 3.1
speaking balance: gold is Nathan, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 15:19 Holst refuses to share rep quota numbers
Holst explicitly sets a boundary against Latka's direct questioning by stating that quota figures are something he will keep to himself.
Hardest push from Nathan ▶ 15:27 Latka presses on withheld quota dataLatka refuses to immediately let go of the quota metric, challenging Holst to explain why the number cannot be generalized.
Biggest teaching moment ▶ 8:02 Holst corrects Latka's inflated growth calculationLatka attempts to credit the company with nearly 100% annual growth, but Holst firmly corrects the numbers to a grounded 50% year-over-year rate.
Nathan holds their own ▶ 12:00 Latka breaks down valuation and clean round structureLatka quickly synthesizes the 5x multiple on 20 million ARR to pinpoint a 100 million valuation and drills into whether capital was clean balance-sheet cash.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Nathan as informed peer | Guest teaching | Guest disagreement | Nathan pushing back | Why |
|---|---|---|---|---|---|---|
| Executive Summary and Overview of LMS365's Growth | 4 | 5 | 2 | 1 | Latka opens by noting the challenge of employee performance management tools. Holst gently reframes the entire domain from traditional human resources to what he defines as the emerging human success category. | |
| Target Market, Average Deal Size, and Weekly 10 Acquisition | 6 | 3 | 1 | 3 | Latka demonstrates preparation by citing specific tech.eu reporting on the Weekly 10 acquisition price and drills into ACV and seat numbers. Holst readily confirms the metrics and strategic logic behind the acquisition. | |
| Contrasting European Mindset and American Growth Ambition | 6 | 6 | 2 | 4 | Holst provides deep analysis on the cultural differences regarding risk and failure between Nordic and US founders. When Latka tries to calculate a 100% growth rate, Holst politely corrects him down to the actual 50% figure. | |
| The Danish Founder Origins and Hiring a Scale-Up CEO | 6 | 5 | 2 | 4 | Latka unpacks the Series A capitalization, calculating the implied 100 million dollar valuation from the five to six X multiple. Holst explains why they opted for a clean primary round over secondary-heavy 50 million dollar term sheets. | |
| Expansion Metrics, Net Revenue Retention, and Customer Success | 6 | 6 | 5 | 5 | Latka pushes into individual rep quotas and sales team unit economics, but Holst sets a boundary and declines to share exact quota figures. Latka pushes back to understand why, leading Holst to explain their geographic 14-hub model. | |
| From SharePoint Consultancy to Modern Azure and Teams Platform | 5 | 6 | 3 | 4 | Latka explores LMS365's origin story, noting a 15-year plateau under 1 million dollars ARR. Holst corrects the exact timeline milestones and details the pivotal 2016 architectural rewrite for Azure and Microsoft Teams. | |
| Famous Five Rapid-Fire Questions with Rasmus Holst | 3 | 1 | 1 | 1 | Standard Famous Five rapid-fire segment. Holst answers cooperatively and succinctly regarding his favorite CEO, tech stack, and personal routines. |
Statements from this episode (19)
LMS365 builds its learning platform directly inside Microsoft Teams
“We've been building a learning management platform built into Microsoft Teams because we believe that learning should be where you actually meet where you are at every day.”
LMS365 customers pay an average of $15,000 annually
“And they typically pay us around 15,000 for a solution, that's the average.”
LMS365 acquired Weekly10 for €4.5M in cash and equity
“Ah, that's in that range. It was bought half in cash and half in share. So the numbers is there, thereabouts. Yes.”
Nordic founders prioritize longevity over US-style growth sprints
“Often we are a little bit timid. There's a little bit of a glass ceiling in, in the Nordics. We're super good at longevity building businesses, but the burst and the window of opportunity that, that Americans see and that they cherish. And hey, I have the oppo…”
Business failure carries a lasting stigma in Europe unlike the US
“Failure in the U.S. Is a different kind of beast. If you're taking off the football team as wide receiver and you have to go to junior varsity and try to come back to varsity, you're celebrated more if you make it back to varsity because you endure it, you fou…”
LMS365 bootstrapped to $18M ARR before raising a $20M Series A
“The Series A was for twenty million. So it was actually under the premise that we have a world-class cash flow engine. When you sell to Microsoft customers, they're used to paying upfront. So that made us bootstrapped all the way up to eighteen million dollars…”
LMS365 scaled from $18M to $30M ARR during 2023
“We hit eighteen million in, in 20, 20 early 20, 23, and we came out of last year with about thirty million.”
LMS365 outpaced publicly traded competitors like Cornerstone in 2023
“And if you look at our publicly traded competitors, like it to chamber or cornerstone, we certainly outgrew them.”
Navision was Denmark's first unicorn with a $2.5B exit to Microsoft
“Our chairman was from Navision. Which is the first ever Danish unicorn at 2.5 billion exit to Microsoft”
LMS365 raised its Series A at a 5x to 6x ARR multiple
“We raised that around of between five and six X is what I'll give you.”
LMS365's entire $20M Series A was primary balance sheet capital
“And that was all balance sheet because then that was the trade-off, right? You want to take money in to be able to grow. Blue Cloud Ventures understood this, and you didn't want to sell out secondaries at that rate.”
LMS365 rejected $50M term sheets with heavy secondary share sales
“We turned down a number of fifty million dollar term sheets with a lot of secondaries in there, but then it was like, hey, we don't want that valuation.”
13 of LMS365's 14 sales hubs hit quota last year
“Our quota philosophy is attainable, so that's probably more Nordic than it is American and that meant that we run 14 hubs, which is essentially SDRs and business managers as a hub, and of the 14 hubs that we run 13 of them made quota or above last year.”
LMS365 serves around 2,000 customers and over 2 million users
“2000 ish, and about just a north of two million users.”
LMS365's CTO rebuilt the platform for Azure and Teams for $70,000
“In 2016 is the birth of the company as it is today, because Freddie Bang, who's still our CTO, comes and says to the board, I will rebuild this for Azure and for Teams, and they give him 50,000 Danish kronos or 7000 dollars. He spent 70,000 dollars. Rebuilding…”