May 18, 2020 · 22m · top-founders
1759 Founder Hit $1.3m ARR During COVID Getting Customers on 3 Year Contracts, How?!
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
Truelytics President and CEO Jeremy Carnelli explains how his wealth management SaaS platform scaled to $1.3 million in ARR by pivoting from direct sales to multi-year enterprise contracts, navigating COVID-19 market disruptions, and solving industry-wide advisor succession challenges.
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 31.9% of the talking time here. How this is scored →
Nathan as informed peer 5.2 Guest teaching 2.2 Guest disagreement 0.7 Nathan pushing back 3.0
speaking balance: gold is Nathan, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 20:28 Deflecting Latka's valuation question
Carnelli explicitly pushes back against Latka's questioning by stating he will defer the valuation multiple question to his investment bankers.
Hardest push from Nathan ▶ 12:31 Challenging burn rate mathLatka confronts Carnelli with the mathematical inconsistency between his $120k MRR, $134k gross burn, and claimed $50k net burn.
Biggest teaching moment ▶ 3:41 Educating Latka on wealth management ecosystemCarnelli educates Latka on the multifaceted structure of wealth management enterprises, including broker-dealers, custodians, and OSJs.
Nathan holds their own ▶ 18:15 Synthesizing retention and expansion mathLatka demonstrates deep SaaS mastery by instantly translating the 10% annual contract price increase and 0% churn into a 110% net revenue retention metric.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Nathan as informed peer | Guest teaching | Guest disagreement | Nathan pushing back | Why |
|---|---|---|---|---|---|---|
| Truelytics Platform and the Wealth Management Transition | 4 | 5 | 0 | 1 | Latka admits he doesn't understand the enterprise landscape in wealth management, allowing Carnelli to break down the industry's complex distribution channels and advisor transition crisis. | |
| Pricing Structure and Enterprise Tiering | 6 | 1 | 0 | 2 | Latka does rapid mental arithmetic on unit economics ($15 per seat) and catches the guest accidentally misspeaking the year 2020 instead of 2019. | |
| COVID-19 Impact and the Infinite Game Strategy | 3 | 2 | 0 | 1 | Carnelli walks through how COVID disrupted their sales pipeline and led them to adopt Simon Sinek's infinite game mindset to conserve cash. | |
| Sponsor Break: Fiverr Business Solutions | 7 | 2 | 1 | 7 | After the sponsor read, Latka aggressively drills into Carnelli's contradictory burn and MRR figures, forcing the guest to admit and clarify missing revenue streams. | |
| Team Adjustments and Securing Multi-Year Contracts | 5 | 2 | 1 | 4 | Latka presses Carnelli on how they secure three-year upfront commitments and questions how enforceable the contracts are if an advisor churns early. | |
| Expansion Economics, CAC, and Strategic Capital Search | 6 | 1 | 2 | 3 | Latka deduces net revenue retention from price escalator clauses and inquires about valuation multiples, which Carnelli explicitly chooses to dodge. |
Statements from this episode (15)
Carnelli: Wealth management needs 250,000 new advisors to meet demand
“And I think Sorelli and associates predicts that the industry needs to recruit and or bring in 250,000 new financial advisors just to meet current demands.”
Carnelli: Truelytics is the first transition management SaaS for wealth advisors
“So it's that, and it's the first one of its kind. Up until this point, the industry's really been dominated by professional services.”
Carnelli: Truelytics counts Fidelity and LPL among top enterprise customers
“As far as our top enterprise customers are concerned, we work with Cetera, LPL Capital Group, HD Vest, Brinker Carson Group Advisor Group Fidelity, the like, the likes of that.”
Truelytics counts 7,500 advisory firms across 16 enterprise relationships
“It's 7500 independent financial advisory firms. Now, the bulk of that, 90% of that came from the wealth management enterprises, of which we have 16 of those enterprise relationships.”
Truelytics charges an average ACV of $70k on three-year contracts
“So the average annual contract value is 70,000 dollars, and they pay that they sign up for three-year contracts.”
Carnelli: Truelytics raised over $3M exclusively from insiders and angels
“We've had two different rounds of fundraising early on when we, to acquire the IP was like, we raised about a million dollars generally from friends and family and some industry insiders. And then at the beginning of 2018, I think we did another two and a half…”
Carnelli: Truelytics reached $122K MRR in 2019, up 109% year-over-year
“We ended 2019 with 122,000 in MRR. That was a 109% increase over 2018, which was at 53,915.”
Carnelli: Truelytics posted -$540K EBITDA in 2019
“So our EBITDA last year, we weren't profitable last year. Again, we had about six months in the green, but we ended with -540,000 dollars and negative sort of 48% EBITDA.”
Carnelli: Truelytics cuts 2020 net new target to $600K max
“Instead of reaching for that Million as a net new reach target. It's now 600,000 at the high end. But if we finish the, if we close 250,000 of net new, we still end the year with a half million in the bank.”
Truelytics reports $134K gross burn and $55K net monthly burn
“We have a monthly burn monthly, well, a monthly burn of 134,000, but given all of the current enterprise contracts, so that's gross. Our net burn is 55,000.”
Truelytics closed 2019 with roughly $1.05M in enterprise ARR
“We ended in 2019 with about 1.1 million in in subscription revenue, enterprise subscription revenue, and Let's see that. So, and then the enterprise ARR on that is a million 1,047,000.”
Carnelli: Truelytics needs $100K-$200K in Q2 MSAs to avoid furloughs
“Basically, in Q-two, we want to at least have between a hundred to 200,000 dollars of signed MSAs in their first round of edits to meet our goal. Like, if we do that, we're not going to make, we're not going to take any additional action. If we don't, if we ha…”
Carnelli: Truelytics contracts include a 10% annual price escalator
“So our terms allow us to increase the base subscription 10% every year.”
Truelytics reports customer acquisition cost of $30,686 on $70,000 ACV
“So we are paying exactly 30,686 dollars.”
Truelytics mandates investment bank to pursue strategic investment or sale
“We just we just actually gave a mandate to an investment bank yesterday after, after going through a pretty rigorous process. And they are going to help us either look for well, generally help us find a strategic. I think that's their mandate.”