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Nov 23, 2023 · 21m · top-founders

How to build a $30m SaaS in 18 Months focusing on an unsexy niche

Rachel Stern · 12m spoken Nathan Latka · 6m spoken
0:00 / 0:00

gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions

In this episode of Conversations with Nathan Latka, Streamline Chief Strategy Officer Rachel Stern discusses scaling a GovTech SaaS platform to $400,000 in monthly recurring revenue by targeting 55,000 underserved special district governments. Stern breaks down Streamline's proprietary market research, outbound sales engine, fintech monetization roadmap, and ongoing Series A fundraising strategy.

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 36.5% of the talking time here. How this is scored →

Nathan as informed peer 4.9 Guest teaching 3.3 Guest disagreement 0.6 Nathan pushing back 2.6
05100:0010:0020:000:38–3:50 · Nathan as informed peer 4/10 Executive Summary of Streamline's Business Model Nathan prompts Rachel to explain her background transitioning from venture investing to operating at Streamline, following up on public-private incentive programs.3:50–6:22 · Nathan as informed peer 4/10 Defining the Special District Market and SaaS Product Suite Rachel educates Nathan on what special districts actually are and how Streamline structures its pricing tiers according to operating budgets.6:23–9:08 · Nathan as informed peer 6/10 Evaluating Integrated Payments and Fintech Expansion Strategy Nathan introduces SaaS-plus-fintech economics, while Rachel clarifies that basic Stripe integration falls short for recurring utility billing.9:08–13:22 · Nathan as informed peer 6/10 Mapping the Undiscovered Total Addressable Market of 55,000 Districts Nathan probes the unusual high-touch sales motion for low-ARPU accounts, and Rachel explains their stratified SDR-AAE-AE pipeline structure.13:22–16:49 · Nathan as informed peer 6/10 Reviewing Historical Revenue Growth and Executive Additions Nathan pushes Rachel to clarify her tenure after a timeline discrepancy and drills down into the tradeoff between venture growth and growth equity efficiency.16:49–19:34 · Nathan as informed peer 7/10 Unlocking Value in the $275 Billion Special District Economy Nathan rapidly calculates the $275 billion aggregate GMV of special districts and questions why Streamline partners instead of building payment rails, which Rachel defends on tech-debt grounds.19:35–20:23 · Nathan as informed peer 1/10 Famous Five Rapid-Fire Questions with Rachel Stern Nathan executes the standard Famous Five rapid-fire closing routine with quick, collaborative answers from Rachel.0:38–3:50 · Guest teaching 3/10 Executive Summary of Streamline's Business Model Nathan prompts Rachel to explain her background transitioning from venture investing to operating at Streamline, following up on public-private incentive programs.3:50–6:22 · Guest teaching 5/10 Defining the Special District Market and SaaS Product Suite Rachel educates Nathan on what special districts actually are and how Streamline structures its pricing tiers according to operating budgets.6:23–9:08 · Guest teaching 4/10 Evaluating Integrated Payments and Fintech Expansion Strategy Nathan introduces SaaS-plus-fintech economics, while Rachel clarifies that basic Stripe integration falls short for recurring utility billing.9:08–13:22 · Guest teaching 5/10 Mapping the Undiscovered Total Addressable Market of 55,000 Districts Nathan probes the unusual high-touch sales motion for low-ARPU accounts, and Rachel explains their stratified SDR-AAE-AE pipeline structure.13:22–16:49 · Guest teaching 3/10 Reviewing Historical Revenue Growth and Executive Additions Nathan pushes Rachel to clarify her tenure after a timeline discrepancy and drills down into the tradeoff between venture growth and growth equity efficiency.16:49–19:34 · Guest teaching 3/10 Unlocking Value in the $275 Billion Special District Economy Nathan rapidly calculates the $275 billion aggregate GMV of special districts and questions why Streamline partners instead of building payment rails, which Rachel defends on tech-debt grounds.19:35–20:23 · Guest teaching 0/10 Famous Five Rapid-Fire Questions with Rachel Stern Nathan executes the standard Famous Five rapid-fire closing routine with quick, collaborative answers from Rachel.0:38–3:50 · Guest disagreement 0/10 Executive Summary of Streamline's Business Model Nathan prompts Rachel to explain her background transitioning from venture investing to operating at Streamline, following up on public-private incentive programs.3:50–6:22 · Guest disagreement 0/10 Defining the Special District Market and SaaS Product Suite Rachel educates Nathan on what special districts actually are and how Streamline structures its pricing tiers according to operating budgets.6:23–9:08 · Guest disagreement 1/10 Evaluating Integrated Payments and Fintech Expansion Strategy Nathan introduces SaaS-plus-fintech economics, while Rachel clarifies that basic Stripe integration falls short for recurring utility billing.9:08–13:22 · Guest disagreement 1/10 Mapping the Undiscovered Total Addressable Market of 55,000 Districts Nathan probes the unusual high-touch sales motion for low-ARPU accounts, and Rachel explains their stratified SDR-AAE-AE pipeline structure.13:22–16:49 · Guest disagreement 1/10 Reviewing Historical Revenue Growth and Executive Additions Nathan pushes Rachel to clarify her tenure after a timeline discrepancy and drills down into the tradeoff between venture growth and growth equity efficiency.16:49–19:34 · Guest disagreement 1/10 Unlocking Value in the $275 Billion Special District Economy Nathan rapidly calculates the $275 billion aggregate GMV of special districts and questions why Streamline partners instead of building payment rails, which Rachel defends on tech-debt grounds.19:35–20:23 · Guest disagreement 0/10 Famous Five Rapid-Fire Questions with Rachel Stern Nathan executes the standard Famous Five rapid-fire closing routine with quick, collaborative answers from Rachel.0:38–3:50 · Nathan pushing back 1/10 Executive Summary of Streamline's Business Model Nathan prompts Rachel to explain her background transitioning from venture investing to operating at Streamline, following up on public-private incentive programs.3:50–6:22 · Nathan pushing back 2/10 Defining the Special District Market and SaaS Product Suite Rachel educates Nathan on what special districts actually are and how Streamline structures its pricing tiers according to operating budgets.6:23–9:08 · Nathan pushing back 3/10 Evaluating Integrated Payments and Fintech Expansion Strategy Nathan introduces SaaS-plus-fintech economics, while Rachel clarifies that basic Stripe integration falls short for recurring utility billing.9:08–13:22 · Nathan pushing back 4/10 Mapping the Undiscovered Total Addressable Market of 55,000 Districts Nathan probes the unusual high-touch sales motion for low-ARPU accounts, and Rachel explains their stratified SDR-AAE-AE pipeline structure.13:22–16:49 · Nathan pushing back 4/10 Reviewing Historical Revenue Growth and Executive Additions Nathan pushes Rachel to clarify her tenure after a timeline discrepancy and drills down into the tradeoff between venture growth and growth equity efficiency.16:49–19:34 · Nathan pushing back 4/10 Unlocking Value in the $275 Billion Special District Economy Nathan rapidly calculates the $275 billion aggregate GMV of special districts and questions why Streamline partners instead of building payment rails, which Rachel defends on tech-debt grounds.19:35–20:23 · Nathan pushing back 0/10 Famous Five Rapid-Fire Questions with Rachel Stern Nathan executes the standard Famous Five rapid-fire closing routine with quick, collaborative answers from Rachel.

speaking balance: gold is Nathan, purple is the guest (3 minute bins)

0:00 · Nathan 64.9% · guest 35.1%0:00 · Nathan 64.9% · guest 35.1%3:00 · Nathan 12.7% · guest 87.3%3:00 · Nathan 12.7% · guest 87.3%6:00 · Nathan 32.7% · guest 67.3%6:00 · Nathan 32.7% · guest 67.3%9:00 · Nathan 16.3% · guest 83.7%9:00 · Nathan 16.3% · guest 83.7%12:00 · Nathan 38% · guest 62%12:00 · Nathan 38% · guest 62%15:00 · Nathan 30.3% · guest 69.7%15:00 · Nathan 30.3% · guest 69.7%18:00 · Nathan 60.6% · guest 39.4%18:00 · Nathan 60.6% · guest 39.4%21:00 · Nathan 81% · guest 19%21:00 · Nathan 81% · guest 19%
Sharpest disagreement ▶ 18:41 Rachel defends partnering over building proprietary payments

Rachel pushes back against Nathan's suggestion to build their own payment rails by highlighting the severe technical debt and distraction it would create.

 Hardest push from Nathan ▶ 10:56 Nathan challenges high-touch sales reps on low ACV deals

Nathan directly challenges how the company can sustain 12 quota-carrying sales reps on software priced under $300 a month.

 Biggest teaching moment ▶ 9:08 Rachel disproves census data on the 55k special districts TAM

Rachel explains how official census data undercounts and misrepresents special districts, detailing Streamline's manual state-by-state data discovery.

 Nathan holds their own ▶ 18:18 Nathan calculates total GMV scale and revenue potential

Nathan calculates the math in real time to reveal a $275 billion aggregate district GMV and questions the monetization capture strategy.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Executive Summary of Streamline's Business Model 4301 Nathan prompts Rachel to explain her background transitioning from venture investing to operating at Streamline, following up on public-private incentive programs.
Defining the Special District Market and SaaS Product Suite 4502 Rachel educates Nathan on what special districts actually are and how Streamline structures its pricing tiers according to operating budgets.
Evaluating Integrated Payments and Fintech Expansion Strategy 6413 Nathan introduces SaaS-plus-fintech economics, while Rachel clarifies that basic Stripe integration falls short for recurring utility billing.
Mapping the Undiscovered Total Addressable Market of 55,000 Districts 6514 Nathan probes the unusual high-touch sales motion for low-ARPU accounts, and Rachel explains their stratified SDR-AAE-AE pipeline structure.
Reviewing Historical Revenue Growth and Executive Additions 6314 Nathan pushes Rachel to clarify her tenure after a timeline discrepancy and drills down into the tradeoff between venture growth and growth equity efficiency.
Unlocking Value in the $275 Billion Special District Economy 7314 Nathan rapidly calculates the $275 billion aggregate GMV of special districts and questions why Streamline partners instead of building payment rails, which Rachel defends on tech-debt grounds.
Famous Five Rapid-Fire Questions with Rachel Stern 1000 Nathan executes the standard Famous Five rapid-fire closing routine with quick, collaborative answers from Rachel.

Statements from this episode (18)

Assertion Supported
Stern: Advantage Capital used state lobbyists to create government capital incentive programs
“And Advantage was a very unique type of private equity investor in that it used a network of state and local lobbyists across the country to create programs where government incentivized capital and to come into very vulnerable areas.”
Rachel Stern Nov 23, 2023 ▶ 2:45
Assertion Not checkable as stated
Stern: Streamline's average customer pays about $275 per month
“Our average monthly customer is paying us about 275 dollars a month.”
Rachel Stern Nov 23, 2023 ▶ 5:22
Disclosure
Stern: Streamline captures roughly 1% net margin on platform payments
“We are in, we're processing payments tomorrow, and we're keeping about one percent of that.”
Rachel Stern Nov 23, 2023 ▶ 6:54
Opinion
Stern: Stripe is insufficiently sophisticated for recurring utility billing
“It's just not a sophisticated enough tool for reoccurring payments or someone to pause their payments or someone to process, you know, ongoing water or utility bills.”
Rachel Stern Nov 23, 2023 ▶ 7:15
Assertion Not checkable as stated
Stern: Streamline surpasses 1,450 special district customers
“We just passed our 1450th customer.”
Rachel Stern Nov 23, 2023 ▶ 7:33
Disclosure
Stern: Streamline loses large utility deals due to payment processing gaps
“Stripe is a great stock gap for what our districts need right now, but we are losing out on deals like water and utility districts, which are much bigger fish because we can't process sophisticated.”
Rachel Stern Nov 23, 2023 ▶ 8:19
Assertion Supported
Stern: 2017 US Census counted 40,000 special districts
“The census did exploration in 2017, and they came up with the number 40,000.”
Rachel Stern Nov 23, 2023 ▶ 9:20
Assertion Not checkable as stated
Stern: 20% to 30% of Census special district records are invalid
“About 20 or 30% of the census list Unreachable, whether they'd been dissolved, or didn't have a real phone number, or weren't a real district”
Rachel Stern Nov 23, 2023 ▶ 9:34
Insight
Stern: Mapping the TAM is the biggest barrier in GovTech
“Figuring out that TAM is really the biggest barrier to entry in this market.”
Rachel Stern Nov 23, 2023 ▶ 10:21
Assertion Not checkable as stated
Stern: Streamline sees a 37% demo conversion rate from calls
“I mean, we have them making between 50 and 65 calls a week. And I would say of that, we have about a 37% translation rate into S-threes.”
Rachel Stern Nov 23, 2023 ▶ 12:23
Assertion Not checkable as stated
Stern: Streamline achieves a roughly 60% close rate on demos
“And then we have about a 60% close rate on demos.”
Rachel Stern Nov 23, 2023 ▶ 12:40
Assertion Not checkable as stated
Stern: Streamline grew revenue 122% over the past year
“We incorporated 18 months ago, and we grew 122% this year.”
Rachel Stern Nov 23, 2023 ▶ 13:32
Assertion Not checkable as stated
Stern: Streamline was generating $120K to $140K monthly a year ago
“Between, between a 120, a 140.”
Rachel Stern Nov 23, 2023 ▶ 13:44
Disclosure
Stern: Streamline raised $2M seed party round in common stock
“We did a seed where we only offered common stock, but did about two million dollars in what we're calling a party round.”
Rachel Stern Nov 23, 2023 ▶ 14:47
Disclosure
Stern: Streamline is raising Series A with active term sheets
“That was last year, and right now we're raising an A. Okay, interesting. And we have a couple of term sheets in play right now.”
Rachel Stern Nov 23, 2023 ▶ 14:56
Disclosure
Stern: Streamline raised seed round at $14M post-money valuation
“It was a 12 pre-fourteen post.”
Rachel Stern Nov 23, 2023 ▶ 17:04
Prediction Not checkable as stated
Stern: Raising $6M to $8M will bring Streamline to profitability in 18 months
“Yeah, I think we're looking to raise between six and eight. I think that will allow us to get to profitability in the next 18 months.”
Rachel Stern Nov 23, 2023 ▶ 17:16
Assertion Supported
Stern: US special districts average $5M in annual budget size
“The average is five million, but there's a real spectrum, right?”
Rachel Stern Nov 23, 2023 ▶ 18:19
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