Dec 28, 2020 · 26m · top-founders
Mode Grows 95% to $19m ARR, Turning Analysis Into Superhero's
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
Mode CEO and co-founder Derek Steer details how his team built and scaled an analyst-centric collaborative data platform, growing from Yammer-inspired beginnings to tens of millions in ARR through product-led land-and-expand strategies and educational content marketing.
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 25.3% of the talking time here. How this is scored →
Nathan as informed peer 5.5 Guest teaching 5.2 Guest disagreement 1.8 Nathan pushing back 3.8
speaking balance: gold is Nathan, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 14:55 Rejecting the idea of buying a developer community
Derek dismisses Latka's suggestion to buy an external community platform, arguing technical users immediately spot artificial corporate sales tactics.
Hardest push from Nathan ▶ 9:40 Host pushes past revenue deflectionWhen Derek hesitates to reveal growth numbers, Latka refuses to let it slide, reminding him of the show's format and pushing him into confirming near 100% growth.
Biggest teaching moment ▶ 11:04 Educating host on Fishtown Analytics and dbtAfter Latka admits he has never heard of Fishtown, Derek explains how dbt fits into the data pipeline between Fivetran and Mode.
Nathan holds their own ▶ 23:22 Host contrasts Notion and Coda fundraising modelsLatka demonstrates deep market knowledge by contrasting Coda's pre-revenue $60M raise with Notion's lean, bootstrapped trajectory.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Nathan as informed peer | Guest teaching | Guest disagreement | Nathan pushing back | Why |
|---|---|---|---|---|---|---|
| The Decision to Launch Mode and Opportunity Costs | 5 | 3 | 1 | 3 | Latka probes into the exact opportunity cost and dilution from Derek's initial seed round. Derek clarifies that his high compensation only kicked in after Microsoft acquired Yammer and walks through the initial $5M valuation math. | |
| Pricing Model Evolution and Grandfathering Accounts | 6 | 7 | 1 | 3 | Latka asks how Mode manages grandfathered accounts and transitions downstream to capture enterprise expansion. Derek provides an in-depth breakdown of how traditional BI models fail technical analysts and why Mode changed pricing from $3,000 per analyst to $25 per seat to encourage broad collaboration. | |
| Revenue Milestones and BI Market Dynamics | 6 | 7 | 4 | 6 | Latka pushes Derek for exact revenue numbers after an initial deflection and suggests spending $5M to acquire an existing developer community. Derek educates Latka on dbt/Fishtown and the modern data stack, then firmly rejects the idea of buying a community as artificial and off-putting to technical users. | |
| Team Structure and Early Sales Leadership | 5 | 5 | 1 | 4 | Latka inquires about early sales headcount and milestones, assuming Mode was at $500k ARR before hiring reps. Derek corrects him, explaining they were barely between $0 and $50k ARR, and shares the realization that analyzing sales is vastly different from executing them. | |
| Venture Capital, Debt, and Bootstrapping Lessons | 6 | 5 | 1 | 2 | Latka asks whether taking early debt was a regret and notes his affinity for bootstrapping. Derek agrees, sharing advice from Yammer's former CFO about the dangers of high early valuations and explaining why he wishes Mode had stayed leaner early on. | |
| Acquisition Inquiries and Recent Financing Round | 5 | 4 | 3 | 5 | Latka directly queries Derek regarding Google acquisition talks and Series C dilution percentage, which Derek deflects diplomatically. During the closing questions, Latka compares Notion and Coda's funding strategies while Derek explains the practical integration difference for Mode. |
Statements from this episode (17)
Steer: Unvested Yammer equity left behind is worth seven figures annually today
“Well, it's, I'd have to go do some stock math because the, my Microsoft shares at that time were worth a fraction of what they would be better now. Yeah. Yeah. Yeah. If you look at the price now is it was a seven figure annual type type of amount.”
Mode raised its initial seed round at a $5M valuation
“So I guess it was about 10%, right? The valuation was like in the range of five million, which we, you know, we were just triangulating around like kind of standard YC evaluations at the time.”
David Sacks agreed to invest on slide two of Mode's pitch deck
“We brought him a deck. And on the second slide, he was like, okay, yeah, I'm in. Let's do it. Like the, it's funny. The second slide was it was GitHub for data”
Derek Steer: Mode has customers buying up to 6,000 seats
“The way that we do it is, is based on scale, and we have folks who are buying, you know, four, five, 6000 seats.”
Derek Steer: Mode's list price is $25 per seat monthly plus platform fee
“So the way that we do it now is we have a platform fee, and then a per seat fee. The list price on the seat fee is 25 dollars per Per person per month.”
Derek Steer: Mode serves around 600 customer logos
“Yeah it's around 600. This is the most recent thing that we published.”
Steer: Legacy BI treats technical data workers merely as metric specifiers
“BI generally, as a category, decides that the technical person's job is to specify the system, right? They build out a menu of metrics, and then The actual analysis or dashboard building or whatever is going to happen by people who aren't professional analysts…”
Mode cut per-seat pricing from $250 to $25 per month
“When we think about the way that we expand, you know, that was a part of it was shifting from that pricing model to one that again is now like 25 per seat per month as opposed to 250 per seat per month.”
Steer in 2020: dbt will be the next major data product
“DBT is kind of the product, right? That's going to be the next thing. And if we were going to build it, we would do it the way that they did it.”
SQL books fail analysts by focusing on setup over SELECT queries
“The big problem with SQL as it was taught, like if you were to go buy a SQL book at that time, and maybe even still today it's focused on software development, which means that the first chapters are going to be about setting up your database, getting data int…”
Steer: Mode's SQL School receives hundreds of thousands of monthly uniques
“And that's been tremendously, I mean, this thing gets hundreds of thousands of uniques a month.”
Buying developer communities fails because technical audiences reject corporate takeovers
“I mean, so for our audience, authenticity is critically important. I think that's true for technical audiences in general. People just smell sales and that kind of thing. And nothing feels worse to me than buying a community, right? Like it just, well, I don't…”
Mode hired its first sales rep at under $50K ARR
“No, we were at like we were somewhere north of zero and south of 50 K.”
Mode's first sales leader scaled the company from $500K to $10M ARR
“She took the company from like, you know, ballpark, You know, 500 K to ten million.”
Mode surpassed a rival Yammer spinout that raised at a $20M valuation
“A different Yammer group had split off and raised immediately, like day one at like a twenty million dollar valuation on a business that, you know, mode has surpassed.”