Jul 3, 2021 · 19m · top-founders
BetterAgency CRM for Insurance Hits $1m ARR, Raises $2m on $15m Valuation
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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 Conversations with Nathan Latka, Better Agency co-founder Will Shaw explains how his vertical SaaS CRM and agency management system bootstrapped to $1 million in ARR before raising a $2.1 million seed round at a $15 million valuation to disrupt legacy software in the independent insurance industry.
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 40% of the talking time here. How this is scored →
Nathan as informed peer 5.6 Guest teaching 1.9 Guest disagreement 1.0 Nathan pushing back 2.9
speaking balance: gold is Nathan, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 6:37 Shaw clarifies pre-revenue commitments vs actual revenue
When Latka directly asserts the company was flat based on past disclosures, Shaw firmly pushes back to distinguish early pre-sold commitments from actual launched revenue.
Hardest push from Nathan ▶ 6:37 Latka calls out potential growth stagnationLatka immediately confronts Shaw by comparing his stated historical MRR against figures given in their previous conversation, stating 'so you were flat then.'
Biggest teaching moment ▶ 8:54 Shaw explains the deliberate strategy of increasing CACShaw reframes the standard SaaS playbook by explaining why they intentionally increase CAC via intense onboarding to secure higher LTV and unlock aggressive paid spend.
Nathan holds their own ▶ 9:24 Latka delivers masterclass on setup fees and churn dynamicsLatka challenges Shaw's onboarding cost thesis by citing specific historical churn and setup fee data from Infusionsoft CEO Clate Mask.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Nathan as informed peer | Guest teaching | Guest disagreement | Nathan pushing back | Why |
|---|---|---|---|---|---|---|
| Evolution of Better Agency and the Sales-Driven AMS | 5 | 2 | 1 | 2 | Latka recalls the company's prior metrics and branding while drilling into current price points and customer counts. Shaw smoothly updates him on their product transition to a sales-driven AMS and their reach to $1M ARR. | |
| Structuring the $2.1M Seed Round at a $15M Valuation | 6 | 2 | 1 | 3 | Latka immediately calculates the round mechanics (13x multiple on pre-money ARR) and probes whether the valuation was optimal. Shaw provides strategic context on deliberately raising from angels and strategic investors rather than institutional VCs. | |
| Historical Growth, Monthly Burn, and Customer Acquisition Channels | 6 | 4 | 2 | 5 | Latka pushes back on Shaw's timeline, pointing out that reported numbers sounded flat relative to the 2019 interview. Shaw clarifies the difference between early committed pre-sales and actual cash collection timing. | |
| Strategic Investment in Customer Onboarding and LTV Expansion | 7 | 2 | 1 | 4 | When Shaw outlines an intentional strategy to drive up CAC through heavy onboarding, Latka cites Clate Mask's Infusionsoft playbook regarding mandatory setup fees and churn trade-offs. Latka also questions perpetual affiliate commission structures. | |
| Analyzing Retention, Churn, and Expansion Dynamics | 8 | 1 | 1 | 3 | Shaw asks Latka to check his annual churn math, and Latka instantly computes the compounding expansion and retention figures. Latka breaks down the unit economics and flags the risk of cash collection gaps if payback periods stretch. | |
| Headcount, Sales Compensation, and Founder Equity Ownership | 6 | 1 | 1 | 2 | Latka tests sales compensation ratios (quota-to-OTE) and audits founder dilution across the cap table post-financing, confirming healthy alignment and option pool allocations. | |
| NFL NFC East Predictions and Washington Football Debate | 1 | 1 | 0 | 1 | A brief, lighthearted closing exchange centered on NFC East football predictions and high school connections to Ryan Fitzpatrick. |
Statements from this episode (21)
Will Shaw: Better Agency expects average customer price to reach $500/month
“And now we're getting our average customer a little over 400 and we think we can get to 500 over the next 12 months.”
Will Shaw: Better Agency hits $1M ARR across 260 customers
“So right now we're somewhere around 260 customers. And we just broke the one million ARR mark.”
Will Shaw: Better Agency bootstrapped to $1M ARR before raising seed capital
“So we bootstrapped to this point. We are tomorrow actually closing our first round. So we've got to this far bootstrapped. And so we just are closing on our first round tomorrow.”
Shaw: Better Agency is raising $2.1M at a $15M post-money valuation
“So we're going to raise a total of 2.1 million. It's going to be at a fifteen million dollar post.”
Shaw: Better Agency could have achieved a higher valuation in a frothy market
“We could have totally have driven it higher. I mean, the market, you know, better than I do, the market's pretty frothy right now, and we could have driven it higher, but we were really, my biggest problem with fundraising was telling people no, and the reason…”
Shaw: Better Agency's $2.1M round is split between lead angel and strategics
“We have about 50% from our lead investor, and the other 50% is divided between insurance-specific strategic investors, and then the other half of that would be through strategic other verticalized CRM founders or some people that we know”
Better Agency Grows at Average 10% Monthly Since August 2020
“And then we're growing an average about 10% a month, and we've kind of been consistent about that since about August of 2020.”
Better Agency Gets 70% of Customers Organically, 30% Paid
“Yeah, so about 30% are through our paid strategy and about 70% are coming through either referrals or organic.”
Better Agency Yields 25 Customers per $10k Spend, Converts 70%
“So on tenk in spend, we'll get about 25 net new customers, so we'll get a bunch of trials, and we convert about 70% of those trials, so that'll equate to about 25 new paying customers.”
Better Agency Cancels Inactive Trial Accounts to Force Re-Engagement
“If they don't engage with our onboarding team, we look at a trial as a, as an opportunity for a paying customer. So we immediately start reaching out and trying to onboard. They don't engage with us and they have no usage. We'll preemptively cancel their accou…”
Latka: Infusionsoft Dropped Monthly Churn From 8% to 2% With Setup Fees
“When they were seeing eight percent monthly churn, he said, finally, the way they tackled it is they just charged a setup fee of about 300 bucks, which was equivalent to the, you know, an average of about nine months of the first year ACV on the SaaS side of b…”
Shaw: Better Agency pays $6,000 to $7,000 monthly in affiliate commissions
“We're, it's still pretty small. We're probably, we're paying on an average about six to seven grand a month right now.”
Shaw: Better Agency excludes upsells and upgrades from affiliate commission payouts
“So what we do is it's on the base application that they bring in, and then we kind of take on charge of upgrading them, and so we don't pay out the upgrades to the affiliates.”
Better Agency maintains around 2% monthly churn
“So we're hovering around two percent monthly churn, and I believe on an annual basis, correct my math, what is that about?”
Will Shaw estimates Better Agency net dollar retention at 105% to 110%
“I think we're between a 105, a 110% based off our upsell, but our goal is to get that to one.”
Better Agency estimates its customer LTV between $12k and $14k
“Our LTV right now is, is somewhere ranging between, again, it's a guess because we're a young company. So this range is pretty significantly, but I would say we're steady between 12 to 14 K in our LTV.”
Better Agency targets spending up to $1,500 CAC for 10:1 ratio
“So right now we're willing to spend upwards of 1500 dollars to get all in to get a customer because we can eat We can keep that kind of 10 to one ratio.”
Shaw: Much of Better Agency's competition isn't on the cloud
“There's a lot of things we run into where companies have been in this space since the eighties and nineties. And a lot of them haven't, you know, a lot of our competition isn't even necessarily on the cloud.”