Jul 9, 2022 · 19m · top-founders
DataLab Hits $15m Revenue Charging Farmers Price Per Cow, Largest ACV $100,000
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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, Datalab founder Andre Merkley details how he rebounded from bankruptcy to build a $15 million agricultural ERP software leader and explains his strategic plan to take the company private from an illiquid public exchange.
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 33.8% of the talking time here. How this is scored →
Nathan as informed peer 4.3 Guest teaching 4.3 Guest disagreement 1.9 Nathan pushing back 4.0
speaking balance: gold is Nathan, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 15:12 Andre rejects twenty million acquisition valuation
Andre emphatically shuts down Nathan's proposal that he would sell the business for its current market cap of twenty million dollars.
Hardest push from Nathan ▶ 16:37 Nathan insists on testing a thirty million buyout numberNathan refuses to accept Andre's initial rejection and outlines a hypothetical thirty million dollar payout to probe Andre's true selling price.
Biggest teaching moment ▶ 13:55 Andre educates on partner commission mechanicsAndre provides a masterclass on SaaS channel partnerships, detailing how recurring lifetime reseller kickbacks destroy sales motivation.
Nathan holds their own ▶ 4:46 Nathan rapidly calculates pricing multiplier against largest clientNathan instantly runs mental math multiplying hectare count by unit price to test the ceiling of Datalab's customer contract value.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Nathan as informed peer | Guest teaching | Guest disagreement | Nathan pushing back | Why |
|---|---|---|---|---|---|---|
| Andre Merkley's Background and Datalab's IPO Journey | 4 | 4 | 1 | 3 | Nathan introduces Andre and inquires about Datalab's early revenue and decision to list on the Ljubljana Stock Exchange. Andre explains that the listing was driven by local legal hurdles surrounding employee stock ownership rather than capital raising. | |
| Datalab's Agricultural ERP Product, Customers, and Pricing Strategy | 5 | 5 | 2 | 3 | Andre details the pricing model per animal or hectare for agricultural ERP. When Nathan calculates that the largest client pays 2.5 million euros based on hectarage, Andre corrects the math by explaining heavy early discounting, capping max ACV around 100k. | |
| Strategy to Take Datalab Private from the Public Exchange | 4 | 5 | 1 | 3 | Andre explains the plan to take Datalab private by raising four to five million to delist the illiquid free float. He educates Nathan on how remaining on an illiquid regional exchange post-2008 depressed enterprise value and hindered capital raising. | |
| The Origins of Datalab and Previous Entrepreneurial Failure | 5 | 4 | 2 | 6 | Nathan redirects Andre to clarify bootstrapping history and presses him on why he does not own 90 percent of the equity given minimal outside capital. Andre details the equity split among employees, outside investors, and a philanthropic foundation. | |
| Mid-Roll Promo: Founderpath SaaS Valuation and Comparable Tool | 5 | 6 | 2 | 4 | After the Founderpath sponsor break, Andre details his reseller network and channel strategy. Andre firmly explains why perpetual reseller commissions create a death spiral as partners treat them like a pension fund rather than an incentive. | |
| Datalab's Enterprise Value, Net Profit, and Acquisition Stance | 5 | 5 | 4 | 7 | Nathan repeatedly attempts to find Andre's buyout price, proposing all-cash buyout offers of twenty million and thirty million dollars. Andre firmly rejects both proposals, citing high net profit margins, strong growth, and regulatory limitations on declaring a price. | |
| The Famous Five: Andre Merkley's Personal Insights and Habits | 2 | 1 | 1 | 2 | Nathan runs through the Famous Five rapid-fire questions covering favorite books, Excel as a tool, and Andre's sleep and family life, ending on Andre's temper. |
Statements from this episode (17)
Merkley: Datalab was the first tech IPO on Ljubljana Stock Exchange
“We were the first technology IPO on the Ljubljana Stock Exchange.”
Merkley: Datalab annual revenue is close to 15 million
“So today we're closely to the 15 and one five.”
Merkley: Datalab hopes to reach 50 million in revenue in 2-3 years
“So we hope that we'll be getting the 50 in probably two to three years.”
Merkley: Datalab Has Roughly 500 Farms, Largest at 120,000 Hectares
“So I would say that we have roughly 500 farms, but our, I think our biggest is 120,000 hectares.”
Merkley: Datalab Charges 1 to 1.8 Euros per Hectare Monthly
“We price our software per per asset. So basically you would be paying us per, per cow or per flock of sheep or per hectare of land or orchard or something like that. We're charging, depends on the market where, but where would, we would be charging from one to…”
Merkley: Datalab's Largest Annual ACV Reaches Roughly 100,000 Euros
“No, we don't have anyone. So the largest, largest invoices or projects that we were, that we're making. Are a 100,000 per year or something like that.”
Merkley: Datalab is in the process of going private
“Just in the process of taking the company back private and got in some investors and then scaling up.”
Merkley: Delisting Datalab requires $4M to $5M plus cash reserves
“With four to five million plus what we have spare actually for a stock buybacks we would be able to remove almost the complete free float from the market and delist the company.”
Merkley: Being public in unknown foreign markets decreases enterprise value
“Being public in a unknown foreign market with unknown legislation decreases your enterprise value.”
Merkley: Datalab was bootstrapped after previous 1994 business bankruptcy
“No, we completely was bootstrapped. Actually I went bankrupt in. 94 was my previous company. So I actually, we were not even credit. I was deemed not credit worthy. So it was basically the last paycheck a garage. To computers and a lot of will.”
Merkley: Gecko failed after chip price crash wiped out leveraged inventory
“Well, 70% of our revenues came from brokerage of computer chips. We just loaded up for the Christmas season, and then Hyundai and Samsung announced a new factory of chips, and the price went, the price halved while our chips were on, on the on the flight. That…”
Merkley: Datalab raised zero during IPO and 1M in 2010
“We did not raise, we raised zero on IPO. We simply listed because we wanted to have this valuation, but we did in 2010, we raised the first million for the farming. So at first we raised it by the Swiss private investors. And with them on board, we got to, we …”
Merkley: Perpetual partner commissions create a fatal reseller death spiral
“Perpetual, perpetual commissions are a killer for the business because they sooner or later your partner will start treating that investment as a pension fund and we'll lose incentive to sell more. And it's a death spiral.”
Merkley: Datalab's Public Valuation Is in the Low Twenties
“Stock exchange value is, I would say, in the low twenties.”