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Jul 18, 2020 · 17m · top-founders

JustCall Hits $2.5m ARR, 60% Profits, Bootstrapped Helping 1600 Teams Use Cloud Phone Systems

Nathan Latka · 7m spoken Gaurav Sharma · 6m spoken
0:00 / 0:00

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In this interview with Nathan Latka, JustCall founder Gaurav Sharma explains how he bootstrapped his cloud phone software company to $2.9 million in annual recurring revenue with 60% profit margins. Sharma details his capital-efficient organic acquisition channels, non-commission sales strategy, and unique employee profit-sharing model.

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 51.4% of the talking time here. How this is scored →

Nathan as informed peer 5.3 Guest teaching 1.6 Guest disagreement 0.9 Nathan pushing back 2.6
05100:0010:000:13–2:25 · Nathan as informed peer 1/10 Nathan Latka Subscription Pitch and Member Benefits The segment consists primarily of Latka's subscription pitch and promotional teaser clips, followed by a brief cordial introduction regarding Sharma's prior exit to The New York Times.2:27–5:15 · Nathan as informed peer 6/10 JustCall Overview, User Pricing, and $240K Monthly Run Rate Latka runs the quick math on JustCall's customer count and average price to establish a $240k monthly run rate, verifying user tiers and volume discounts in real time.5:16–8:26 · Nathan as informed peer 7/10 Bootstrapping Origins, Initial MVP, and Team Headcount Expansion Latka drills into sales hiring economics, no-commission comp structures, and immediately challenges Sharma when his stated demo counts and customer conversions imply a conversion rate higher than 60%.8:26–10:50 · Nathan as informed peer 8/10 Net Revenue Retention and Monthly Revenue Churn Analysis Latka demonstrates strong SaaS arithmetic by annualizing monthly churn to calculate required expansion for 106% NRR, then deduces JustCall's monthly burn and 60% profit margin from cash reserve targets.10:50–13:03 · Nathan as informed peer 5/10 Employee Profit Sharing and Engineering Performance Point Matrix Sharma educates Latka on their proprietary engineering point allocation system for annual profit sharing, clarifying that metrics evaluate cross-functional business impact rather than simple lines of code.13:04–15:51 · Nathan as informed peer 8/10 Revenue-Based Financing Evaluation and Avoiding Institutional Equity Latka strongly pushes back on Sharma's perception of revenue-based financing costs, arguing Clearbanc's flat fee model equates to a ~36% APR rather than Sharma's estimated 12%.15:52–16:33 · Nathan as informed peer 2/10 The Famous Five: Daily Habits, Tools, and Advice Standard Famous Five lightning round with rapid-fire questions covering favorite books, tools, sleep habits, and founder advice.0:13–2:25 · Guest teaching 0/10 Nathan Latka Subscription Pitch and Member Benefits The segment consists primarily of Latka's subscription pitch and promotional teaser clips, followed by a brief cordial introduction regarding Sharma's prior exit to The New York Times.2:27–5:15 · Guest teaching 2/10 JustCall Overview, User Pricing, and $240K Monthly Run Rate Latka runs the quick math on JustCall's customer count and average price to establish a $240k monthly run rate, verifying user tiers and volume discounts in real time.5:16–8:26 · Guest teaching 2/10 Bootstrapping Origins, Initial MVP, and Team Headcount Expansion Latka drills into sales hiring economics, no-commission comp structures, and immediately challenges Sharma when his stated demo counts and customer conversions imply a conversion rate higher than 60%.8:26–10:50 · Guest teaching 1/10 Net Revenue Retention and Monthly Revenue Churn Analysis Latka demonstrates strong SaaS arithmetic by annualizing monthly churn to calculate required expansion for 106% NRR, then deduces JustCall's monthly burn and 60% profit margin from cash reserve targets.10:50–13:03 · Guest teaching 4/10 Employee Profit Sharing and Engineering Performance Point Matrix Sharma educates Latka on their proprietary engineering point allocation system for annual profit sharing, clarifying that metrics evaluate cross-functional business impact rather than simple lines of code.13:04–15:51 · Guest teaching 2/10 Revenue-Based Financing Evaluation and Avoiding Institutional Equity Latka strongly pushes back on Sharma's perception of revenue-based financing costs, arguing Clearbanc's flat fee model equates to a ~36% APR rather than Sharma's estimated 12%.15:52–16:33 · Guest teaching 0/10 The Famous Five: Daily Habits, Tools, and Advice Standard Famous Five lightning round with rapid-fire questions covering favorite books, tools, sleep habits, and founder advice.0:13–2:25 · Guest disagreement 0/10 Nathan Latka Subscription Pitch and Member Benefits The segment consists primarily of Latka's subscription pitch and promotional teaser clips, followed by a brief cordial introduction regarding Sharma's prior exit to The New York Times.2:27–5:15 · Guest disagreement 0/10 JustCall Overview, User Pricing, and $240K Monthly Run Rate Latka runs the quick math on JustCall's customer count and average price to establish a $240k monthly run rate, verifying user tiers and volume discounts in real time.5:16–8:26 · Guest disagreement 2/10 Bootstrapping Origins, Initial MVP, and Team Headcount Expansion Latka drills into sales hiring economics, no-commission comp structures, and immediately challenges Sharma when his stated demo counts and customer conversions imply a conversion rate higher than 60%.8:26–10:50 · Guest disagreement 0/10 Net Revenue Retention and Monthly Revenue Churn Analysis Latka demonstrates strong SaaS arithmetic by annualizing monthly churn to calculate required expansion for 106% NRR, then deduces JustCall's monthly burn and 60% profit margin from cash reserve targets.10:50–13:03 · Guest disagreement 1/10 Employee Profit Sharing and Engineering Performance Point Matrix Sharma educates Latka on their proprietary engineering point allocation system for annual profit sharing, clarifying that metrics evaluate cross-functional business impact rather than simple lines of code.13:04–15:51 · Guest disagreement 3/10 Revenue-Based Financing Evaluation and Avoiding Institutional Equity Latka strongly pushes back on Sharma's perception of revenue-based financing costs, arguing Clearbanc's flat fee model equates to a ~36% APR rather than Sharma's estimated 12%.15:52–16:33 · Guest disagreement 0/10 The Famous Five: Daily Habits, Tools, and Advice Standard Famous Five lightning round with rapid-fire questions covering favorite books, tools, sleep habits, and founder advice.0:13–2:25 · Nathan pushing back 0/10 Nathan Latka Subscription Pitch and Member Benefits The segment consists primarily of Latka's subscription pitch and promotional teaser clips, followed by a brief cordial introduction regarding Sharma's prior exit to The New York Times.2:27–5:15 · Nathan pushing back 2/10 JustCall Overview, User Pricing, and $240K Monthly Run Rate Latka runs the quick math on JustCall's customer count and average price to establish a $240k monthly run rate, verifying user tiers and volume discounts in real time.5:16–8:26 · Nathan pushing back 4/10 Bootstrapping Origins, Initial MVP, and Team Headcount Expansion Latka drills into sales hiring economics, no-commission comp structures, and immediately challenges Sharma when his stated demo counts and customer conversions imply a conversion rate higher than 60%.8:26–10:50 · Nathan pushing back 3/10 Net Revenue Retention and Monthly Revenue Churn Analysis Latka demonstrates strong SaaS arithmetic by annualizing monthly churn to calculate required expansion for 106% NRR, then deduces JustCall's monthly burn and 60% profit margin from cash reserve targets.10:50–13:03 · Nathan pushing back 2/10 Employee Profit Sharing and Engineering Performance Point Matrix Sharma educates Latka on their proprietary engineering point allocation system for annual profit sharing, clarifying that metrics evaluate cross-functional business impact rather than simple lines of code.13:04–15:51 · Nathan pushing back 7/10 Revenue-Based Financing Evaluation and Avoiding Institutional Equity Latka strongly pushes back on Sharma's perception of revenue-based financing costs, arguing Clearbanc's flat fee model equates to a ~36% APR rather than Sharma's estimated 12%.15:52–16:33 · Nathan pushing back 0/10 The Famous Five: Daily Habits, Tools, and Advice Standard Famous Five lightning round with rapid-fire questions covering favorite books, tools, sleep habits, and founder advice.

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

0:00 · Nathan 68% · guest 32%0:00 · Nathan 68% · guest 32%3:00 · Nathan 40.7% · guest 59.3%3:00 · Nathan 40.7% · guest 59.3%6:00 · Nathan 36% · guest 64%6:00 · Nathan 36% · guest 64%9:00 · Nathan 53.5% · guest 46.5%9:00 · Nathan 53.5% · guest 46.5%12:00 · Nathan 42.6% · guest 57.4%12:00 · Nathan 42.6% · guest 57.4%15:00 · Nathan 74.7% · guest 25.3%15:00 · Nathan 74.7% · guest 25.3%
Sharpest disagreement ▶ 14:31 Sharma defends Clearbanc financing terms

Sharma pushes back against Latka's high APR calculation, maintaining his payback structure equates to roughly 12% and noting terms vary based on deal specifics.

 Hardest push from Nathan ▶ 14:44 Latka refuses 12% cost of capital claim

Latka directly rejects Sharma's math, stating that Clearbanc would lose money on the loan if the cost of capital were genuinely only 12%.

 Biggest teaching moment ▶ 12:25 Sharma corrects assumption on developer metrics

Sharma corrects Latka's assumption that developer performance is tracked by code volume, explaining how points are assigned for cross-functional support and sales enablement.

 Nathan holds their own ▶ 14:07 Latka breaks down effective APR on short-term debt

Latka demonstrates deep financial expertise by deconstructing revenue-share financing fees and showing how short repayment horizons translate into high annualized interest rates.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Nathan Latka Subscription Pitch and Member Benefits 1000 The segment consists primarily of Latka's subscription pitch and promotional teaser clips, followed by a brief cordial introduction regarding Sharma's prior exit to The New York Times.
JustCall Overview, User Pricing, and $240K Monthly Run Rate 6202 Latka runs the quick math on JustCall's customer count and average price to establish a $240k monthly run rate, verifying user tiers and volume discounts in real time.
Bootstrapping Origins, Initial MVP, and Team Headcount Expansion 7224 Latka drills into sales hiring economics, no-commission comp structures, and immediately challenges Sharma when his stated demo counts and customer conversions imply a conversion rate higher than 60%.
Net Revenue Retention and Monthly Revenue Churn Analysis 8103 Latka demonstrates strong SaaS arithmetic by annualizing monthly churn to calculate required expansion for 106% NRR, then deduces JustCall's monthly burn and 60% profit margin from cash reserve targets.
Employee Profit Sharing and Engineering Performance Point Matrix 5412 Sharma educates Latka on their proprietary engineering point allocation system for annual profit sharing, clarifying that metrics evaluate cross-functional business impact rather than simple lines of code.
Revenue-Based Financing Evaluation and Avoiding Institutional Equity 8237 Latka strongly pushes back on Sharma's perception of revenue-based financing costs, arguing Clearbanc's flat fee model equates to a ~36% APR rather than Sharma's estimated 12%.
The Famous Five: Daily Habits, Tools, and Advice 2000 Standard Famous Five lightning round with rapid-fire questions covering favorite books, tools, sleep habits, and founder advice.

Statements from this episode (15)

Disclosure
Sharma says JustCall has 1,600 business customers paying $150 monthly
“Yeah, so we have about 1600 plus paying customers. Users or customers or brands? Yeah, businesses. Businesses. Okay. I mean, yeah, businesses. And they're paying about, on average, one 50 bucks a month.”
Gaurav Sharma Jul 18, 2020 ▶ 2:55
Disclosure
JustCall was generating approximately $80,000 in monthly revenue in July 2019
“About 80,000 a month.”
Gaurav Sharma Jul 18, 2020 ▶ 3:33
Assertion Not checkable as stated
JustCall has spent zero dollars on advertising to date
“So we haven't spent any money on ads till date.”
Gaurav Sharma Jul 18, 2020 ▶ 3:49
Assertion Not checkable as stated
JustCall spent roughly $20,000 to build its minimum viable product
“I mean, we, we've been like bootstrapping, so I don't know, 20, 20 K maybe.”
Gaurav Sharma Jul 18, 2020 ▶ 5:41
Disclosure
Sharma: JustCall reached 35 employees and added eight new hires
“So now the team has grown up. I mean, we have about 35 people. We just hired today about eight, eight more people. So it'd be like, what is he now?”
Gaurav Sharma Jul 18, 2020 ▶ 5:49
Assertion Not checkable as stated
JustCall converts roughly 60% of product demos into paid customers
“So we normally convert like 60% demos into paid customers.”
Gaurav Sharma Jul 18, 2020 ▶ 6:49
Disclosure
JustCall offers a 70% discount for the first month over free trials
“So another one thing so we don't give any free trials. So our first month is at 70% discount.”
Gaurav Sharma Jul 18, 2020 ▶ 7:11
Assertion Not checkable as stated
Sharma: JustCall maintains around 106% net revenue retention
“I can't give you the number in expansion because I haven't measured that, but it's always about one zero six percent as the retention.”
Gaurav Sharma Jul 18, 2020 ▶ 8:35
Assertion Not checkable as stated
Sharma: JustCall sees 3% monthly revenue churn and 5% logo churn
“It's, so we can, we just measure it on a monthly basis, so it's almost about three percent Revenue term, five percent logo term.”
Gaurav Sharma Jul 18, 2020 ▶ 8:52
Assertion Not checkable as stated
JustCall spends $150 to $200 to acquire a $150 monthly customer
“It costs us about the same, like one 5200 dollars.”
Gaurav Sharma Jul 18, 2020 ▶ 9:24
Disclosure
JustCall waited for 24 months of runway before increasing spending
“So what's the plan for last two years was, you know, I can make enough money to pay people for next 24 months. So now that we have money in the bank and we are safe for next two years, now we can spend money.”
Gaurav Sharma Jul 18, 2020 ▶ 9:39
Assertion Not checkable as stated
Bootstrapped JustCall operates at close to a 60% EBITDA margin
“Yeah, that's close.”
Gaurav Sharma Jul 18, 2020 ▶ 10:49
Disclosure
JustCall distributes 20% to 30% of annual net profits to employees
“So what we do is we take out about 20% to 30% of the profits after the year end, the financial end. And then we have this formula built in where the money's divided among people depending on that formula. So formula, it's actually based on how, for how long yo…”
Gaurav Sharma Jul 18, 2020 ▶ 11:09
Disclosure
JustCall took $25,000 in debt from Stripe
“We got, like, some debt, I mean, just raised some debt from Stripe, like, that 25,000 dollars, you know, just to play around with, like, how it works. Then we're also talking to Clearbank to get some 50, 60 K to, you know, pay to some of the agencies that we a…”
Gaurav Sharma Jul 18, 2020 ▶ 13:32
Assertion Not checkable as stated
Clearbanc financing costs JustCall roughly 12% annualized
“So it's actually like a six months payback, and that's like six-ish percent, so that's 12% a year.”
Gaurav Sharma Jul 18, 2020 ▶ 14:32
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