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May 22, 2020 · 15m · top-founders

1763 $4m ARR Company Burned $1.7m Last Year, Good or Bad?

Maciek Zawadziński · 9m spoken Nathan Latka · 4m spoken
0:00 / 0:00

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

Piwik PRO CEO Maciek Zawadziński joins Nathan Latka to discuss how the privacy-centric analytics company reached over $4M in ARR by rebuilding its platform for enterprise clients and subsidizing its SaaS burn rate with cash flow from sister development agency Clearcode.

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 34.2% of the talking time here. How this is scored →

Nathan as informed peer 5.2 Guest teaching 3.0 Guest disagreement 1.6 Nathan pushing back 3.2
05100:0010:000:00–2:21 · Nathan as informed peer 5/10 Piwik PRO Operational Highlights and Financial Metrics Overview Latka opens with an intro summary and immediately starts estimating ACV/ARPU metrics based on customer count and monthly revenue, which Maciek gently refines down to $1,500/mo.2:22–5:51 · Nathan as informed peer 6/10 Transitioning to Mid-Market and Proprietary Platform Migration Latka challenges Maciek on slow growth from $300k MRR to $4m ARR despite having raised $2M. Maciek educates him on their transition from open-source legacy software to proprietary software, cutting SMBs to focus on mid-market.5:51–9:20 · Nathan as informed peer 6/10 Funding History, Agency Subsidies, and Tech Team Composition Latka digs into the funding mechanics and discovers the round was actually $4M with over $2M used to buy out a shareholder, and explores how agency profits from ClearCode fund the $120k monthly SaaS burn.9:20–13:33 · Nathan as informed peer 7/10 Retention Dynamics, Acquisition Channels, and Company Financing Strategy Latka clarifies retention math when Maciek confuses gross and net retention, walking through how 22% churn plus 19% upsells nets out to 98% net revenue retention before discussing partner commissions and venture debt.13:33–15:42 · Nathan as informed peer 2/10 Famous Five Rapid-Fire Questions With Maciek Zawadziński Standard friendly Famous Five rapid-fire routine followed by Latka's monologue recap of Piwik PRO's key SaaS metrics.0:00–2:21 · Guest teaching 2/10 Piwik PRO Operational Highlights and Financial Metrics Overview Latka opens with an intro summary and immediately starts estimating ACV/ARPU metrics based on customer count and monthly revenue, which Maciek gently refines down to $1,500/mo.2:22–5:51 · Guest teaching 5/10 Transitioning to Mid-Market and Proprietary Platform Migration Latka challenges Maciek on slow growth from $300k MRR to $4m ARR despite having raised $2M. Maciek educates him on their transition from open-source legacy software to proprietary software, cutting SMBs to focus on mid-market.5:51–9:20 · Guest teaching 4/10 Funding History, Agency Subsidies, and Tech Team Composition Latka digs into the funding mechanics and discovers the round was actually $4M with over $2M used to buy out a shareholder, and explores how agency profits from ClearCode fund the $120k monthly SaaS burn.9:20–13:33 · Guest teaching 3/10 Retention Dynamics, Acquisition Channels, and Company Financing Strategy Latka clarifies retention math when Maciek confuses gross and net retention, walking through how 22% churn plus 19% upsells nets out to 98% net revenue retention before discussing partner commissions and venture debt.13:33–15:42 · Guest teaching 1/10 Famous Five Rapid-Fire Questions With Maciek Zawadziński Standard friendly Famous Five rapid-fire routine followed by Latka's monologue recap of Piwik PRO's key SaaS metrics.0:00–2:21 · Guest disagreement 1/10 Piwik PRO Operational Highlights and Financial Metrics Overview Latka opens with an intro summary and immediately starts estimating ACV/ARPU metrics based on customer count and monthly revenue, which Maciek gently refines down to $1,500/mo.2:22–5:51 · Guest disagreement 3/10 Transitioning to Mid-Market and Proprietary Platform Migration Latka challenges Maciek on slow growth from $300k MRR to $4m ARR despite having raised $2M. Maciek educates him on their transition from open-source legacy software to proprietary software, cutting SMBs to focus on mid-market.5:51–9:20 · Guest disagreement 2/10 Funding History, Agency Subsidies, and Tech Team Composition Latka digs into the funding mechanics and discovers the round was actually $4M with over $2M used to buy out a shareholder, and explores how agency profits from ClearCode fund the $120k monthly SaaS burn.9:20–13:33 · Guest disagreement 2/10 Retention Dynamics, Acquisition Channels, and Company Financing Strategy Latka clarifies retention math when Maciek confuses gross and net retention, walking through how 22% churn plus 19% upsells nets out to 98% net revenue retention before discussing partner commissions and venture debt.13:33–15:42 · Guest disagreement 0/10 Famous Five Rapid-Fire Questions With Maciek Zawadziński Standard friendly Famous Five rapid-fire routine followed by Latka's monologue recap of Piwik PRO's key SaaS metrics.0:00–2:21 · Nathan pushing back 2/10 Piwik PRO Operational Highlights and Financial Metrics Overview Latka opens with an intro summary and immediately starts estimating ACV/ARPU metrics based on customer count and monthly revenue, which Maciek gently refines down to $1,500/mo.2:22–5:51 · Nathan pushing back 5/10 Transitioning to Mid-Market and Proprietary Platform Migration Latka challenges Maciek on slow growth from $300k MRR to $4m ARR despite having raised $2M. Maciek educates him on their transition from open-source legacy software to proprietary software, cutting SMBs to focus on mid-market.5:51–9:20 · Nathan pushing back 4/10 Funding History, Agency Subsidies, and Tech Team Composition Latka digs into the funding mechanics and discovers the round was actually $4M with over $2M used to buy out a shareholder, and explores how agency profits from ClearCode fund the $120k monthly SaaS burn.9:20–13:33 · Nathan pushing back 4/10 Retention Dynamics, Acquisition Channels, and Company Financing Strategy Latka clarifies retention math when Maciek confuses gross and net retention, walking through how 22% churn plus 19% upsells nets out to 98% net revenue retention before discussing partner commissions and venture debt.13:33–15:42 · Nathan pushing back 1/10 Famous Five Rapid-Fire Questions With Maciek Zawadziński Standard friendly Famous Five rapid-fire routine followed by Latka's monologue recap of Piwik PRO's key SaaS metrics.

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

0:00 · Nathan 68.3% · guest 31.7%0:00 · Nathan 68.3% · guest 31.7%3:00 · Nathan 14.6% · guest 85.4%3:00 · Nathan 14.6% · guest 85.4%6:00 · Nathan 22.8% · guest 77.2%6:00 · Nathan 22.8% · guest 77.2%9:00 · Nathan 27.6% · guest 72.4%9:00 · Nathan 27.6% · guest 72.4%12:00 · Nathan 21.2% · guest 78.8%12:00 · Nathan 21.2% · guest 78.8%15:00 · Nathan 99.4% · guest 0.6%15:00 · Nathan 99.4% · guest 0.6%
Sharpest disagreement ▶ 3:27 Maciek reframes slow growth critique

Maciek firmly pushes back against Latka's framing that revenue growth was underwhelming by explaining the structural shift of rewriting their core proprietary software and shedding SMB accounts.

 Hardest push from Nathan ▶ 3:09 Latka presses on low growth relative to raised capital

Latka directly confronts Maciek, stating that going from $300k MRR to around $4m ARR is mediocre growth for a company that had raised millions in capital.

 Biggest teaching moment ▶ 3:50 Maciek explains platform rewrite and customer migration

Maciek clarifies that the headline revenue numbers mask a dramatic migration from 10% new proprietary product revenue to over two-thirds of total revenue.

 Nathan holds their own ▶ 9:40 Latka teaches gross vs net revenue retention calculations

Latka steps in to untangle Maciek's confusion regarding gross versus net revenue retention, demonstrating his SaaS metrics domain expertise by calculating the net 98% figure on the fly.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Piwik PRO Operational Highlights and Financial Metrics Overview 5212 Latka opens with an intro summary and immediately starts estimating ACV/ARPU metrics based on customer count and monthly revenue, which Maciek gently refines down to $1,500/mo.
Transitioning to Mid-Market and Proprietary Platform Migration 6535 Latka challenges Maciek on slow growth from $300k MRR to $4m ARR despite having raised $2M. Maciek educates him on their transition from open-source legacy software to proprietary software, cutting SMBs to focus on mid-market.
Funding History, Agency Subsidies, and Tech Team Composition 6424 Latka digs into the funding mechanics and discovers the round was actually $4M with over $2M used to buy out a shareholder, and explores how agency profits from ClearCode fund the $120k monthly SaaS burn.
Retention Dynamics, Acquisition Channels, and Company Financing Strategy 7324 Latka clarifies retention math when Maciek confuses gross and net retention, walking through how 22% churn plus 19% upsells nets out to 98% net revenue retention before discussing partner commissions and venture debt.
Famous Five Rapid-Fire Questions With Maciek Zawadziński 2101 Standard friendly Famous Five rapid-fire routine followed by Latka's monologue recap of Piwik PRO's key SaaS metrics.

Statements from this episode (13)

Assertion Not checkable as stated
Piwik PRO average annual subscription is $20,000 to $50,000
“Our average subscription is 20 to 50 K a year. It's a yearly subscription.”
Maciek Zawadziński May 22, 2020 ▶ 1:41
Assertion Not checkable as stated
Piwik PRO has surpassed $4 million in annual recurring revenue
“So we are over four million annual recueing revenue which basically should add up with this to over 200 clients times the average subscription that you mentioned.”
Maciek Zawadziński May 22, 2020 ▶ 2:59
Assertion Not checkable as stated
Over two-thirds of Piwik PRO revenue comes from new proprietary product
“And now the product is much more mature and we have over two thirds of the customers and revenue going from the new product.”
Maciek Zawadziński May 22, 2020 ▶ 4:43
Prediction Not checkable as stated
Piwik PRO targets $450K to $470K MRR by the end of 2020
“We should finish somewhere around 454 170 K. Now that we see that like our growth started, we started growing again somewhere around like mid last year.”
Maciek Zawadziński May 22, 2020 ▶ 5:13
Assertion Contradicted
Piwik PRO used over $2 million of its raise for shareholder buyouts
“The total was over four million out of two million, more than two millions once To buy out the existing shareholder.”
Maciek Zawadziński May 22, 2020 ▶ 6:22
Disclosure
Piwik PRO reinvests all Clearcode agency profits into product development
“We have the services arm, which is a software development focused on the marketing technology called ClearCode, which is the our let's say sister company. And we, everything that we make from the software development services, we reinvest in the product.”
Maciek Zawadziński May 22, 2020 ▶ 6:40
Assertion Not checkable as stated
Sister agency Clearcode generates $400K to $500K in monthly revenue
“It's makes somewhere around 400 to 500, depending on the amount.”
Maciek Zawadziński May 22, 2020 ▶ 7:20
Assertion Not checkable as stated
Piwik PRO burned $1.7 million in 2019
“So we burned last year, one comma, seven million US dollars.”
Maciek Zawadziński May 22, 2020 ▶ 7:34
Prediction Not checkable as stated
Piwik PRO expects to triple business without significant team growth
“We plan to grow, like, we should be able to triple the business without growing much the team.”
Maciek Zawadziński May 22, 2020 ▶ 8:56
Assertion Not checkable as stated
Piwik PRO offsets 22% gross churn with 19% expansion revenue
“Before we add the expansion, there was like twenty-something percent, so 22%, and we had around we made up this 19% or so with the upsells.”
Maciek Zawadziński May 22, 2020 ▶ 9:58
Assertion Not checkable as stated
Piwik PRO marketing CAC is approximately $7,000 per acquired customer
“From the marketing spending itself it's around 7000 dollars per customer.”
Maciek Zawadziński May 22, 2020 ▶ 10:28
Assertion Not checkable as stated
Piwik PRO sources 85% to 90% of revenue from internal inbound channels
“For partners, we pay anywhere from 10% to 25% but it's worth to mention that we do still around 85%, 90% from our own challenge, mainly inbound.”
Maciek Zawadziński May 22, 2020 ▶ 10:51
Assertion Not checkable as stated
Piwik PRO holding company operates at break-even with almost zero debt
“We are in a very comfortable position that we have almost no debt in the holding company and we are break even at the holding company level.”
Maciek Zawadziński May 22, 2020 ▶ 12:59
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