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Feb 5, 2020 · 19m · top-founders

1656 With $40m in ARR, He's Helping Office Owners Manage Rooms and Scheduling

Paul Statham · 9m spoken
0:00 / 0:00

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

Condeco founder and CEO Paul Statham discusses how the company transitioned from a bootstrapped agency into a global workspace management SaaS leader generating $48 million in annual run-rate revenue. The conversation details Condeco's hybrid hardware-enabled SaaS model, efficient unit economics, enterprise retention rates, and international scaling following a $30 million Series A round.

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 42.4% of the talking time here. How this is scored →

Nathan as informed peer 5.9 Guest teaching 1.9 Guest disagreement 1.4 Nathan pushing back 3.1
05100:0010:000:00–2:15 · Nathan as informed peer 6/10 Host Overview of Condeco's Background and Growth Metrics Latka sets the stage with a comprehensive quantitative summary of Condeco's revenue, customer count, and metrics before prompting Statham to break down their revenue streams.2:16–5:25 · Nathan as informed peer 6/10 Revenue Percentage Breakdown and Enterprise Retention Performance Latka presses for precise definitions on gross versus net logo and revenue retention, then runs a hypothetical unit economics scenario on per-room and per-desk pricing.5:25–7:45 · Nathan as informed peer 5/10 Origins from Custom Development to Pure SaaS Transformation Latka inquires about the transition from an agency dev shop to pure SaaS and examines Condeco's global headcount distribution and sales team structure.7:45–11:08 · Nathan as informed peer 7/10 Sustained YoY Growth and Thirty Million Dollar Series A Latka calculates Condeco's run rate live by multiplying customer count and contract size, then digs into the timing and capital deployment of their thirty million dollar Series A.11:08–13:27 · Nathan as informed peer 7/10 Historical SaaS Run Rate Trajectory and Hardware Gross Margins Latka halts the discussion to reconcile conflicting historical revenue figures between total revenue and pure SaaS run rate, challenging Statham on hardware gross margins.13:27–16:48 · Nathan as informed peer 6/10 Hardware Attachment Rates and Software-Driven Customer Retention Latka references industry analogues with hardware-software combos and drills down on customer acquisition cost and payback periods across small versus enterprise clients.16:48–19:17 · Nathan as informed peer 4/10 The Famous Five Questions with Paul Statham Latka guides Statham through the standard Famous Five rapid-fire questions and concludes with a recap of the company's vital statistics.0:00–2:15 · Guest teaching 1/10 Host Overview of Condeco's Background and Growth Metrics Latka sets the stage with a comprehensive quantitative summary of Condeco's revenue, customer count, and metrics before prompting Statham to break down their revenue streams.2:16–5:25 · Guest teaching 2/10 Revenue Percentage Breakdown and Enterprise Retention Performance Latka presses for precise definitions on gross versus net logo and revenue retention, then runs a hypothetical unit economics scenario on per-room and per-desk pricing.5:25–7:45 · Guest teaching 1/10 Origins from Custom Development to Pure SaaS Transformation Latka inquires about the transition from an agency dev shop to pure SaaS and examines Condeco's global headcount distribution and sales team structure.7:45–11:08 · Guest teaching 2/10 Sustained YoY Growth and Thirty Million Dollar Series A Latka calculates Condeco's run rate live by multiplying customer count and contract size, then digs into the timing and capital deployment of their thirty million dollar Series A.11:08–13:27 · Guest teaching 3/10 Historical SaaS Run Rate Trajectory and Hardware Gross Margins Latka halts the discussion to reconcile conflicting historical revenue figures between total revenue and pure SaaS run rate, challenging Statham on hardware gross margins.13:27–16:48 · Guest teaching 3/10 Hardware Attachment Rates and Software-Driven Customer Retention Latka references industry analogues with hardware-software combos and drills down on customer acquisition cost and payback periods across small versus enterprise clients.16:48–19:17 · Guest teaching 1/10 The Famous Five Questions with Paul Statham Latka guides Statham through the standard Famous Five rapid-fire questions and concludes with a recap of the company's vital statistics.0:00–2:15 · Guest disagreement 1/10 Host Overview of Condeco's Background and Growth Metrics Latka sets the stage with a comprehensive quantitative summary of Condeco's revenue, customer count, and metrics before prompting Statham to break down their revenue streams.2:16–5:25 · Guest disagreement 1/10 Revenue Percentage Breakdown and Enterprise Retention Performance Latka presses for precise definitions on gross versus net logo and revenue retention, then runs a hypothetical unit economics scenario on per-room and per-desk pricing.5:25–7:45 · Guest disagreement 1/10 Origins from Custom Development to Pure SaaS Transformation Latka inquires about the transition from an agency dev shop to pure SaaS and examines Condeco's global headcount distribution and sales team structure.7:45–11:08 · Guest disagreement 2/10 Sustained YoY Growth and Thirty Million Dollar Series A Latka calculates Condeco's run rate live by multiplying customer count and contract size, then digs into the timing and capital deployment of their thirty million dollar Series A.11:08–13:27 · Guest disagreement 2/10 Historical SaaS Run Rate Trajectory and Hardware Gross Margins Latka halts the discussion to reconcile conflicting historical revenue figures between total revenue and pure SaaS run rate, challenging Statham on hardware gross margins.13:27–16:48 · Guest disagreement 2/10 Hardware Attachment Rates and Software-Driven Customer Retention Latka references industry analogues with hardware-software combos and drills down on customer acquisition cost and payback periods across small versus enterprise clients.16:48–19:17 · Guest disagreement 1/10 The Famous Five Questions with Paul Statham Latka guides Statham through the standard Famous Five rapid-fire questions and concludes with a recap of the company's vital statistics.0:00–2:15 · Nathan pushing back 2/10 Host Overview of Condeco's Background and Growth Metrics Latka sets the stage with a comprehensive quantitative summary of Condeco's revenue, customer count, and metrics before prompting Statham to break down their revenue streams.2:16–5:25 · Nathan pushing back 3/10 Revenue Percentage Breakdown and Enterprise Retention Performance Latka presses for precise definitions on gross versus net logo and revenue retention, then runs a hypothetical unit economics scenario on per-room and per-desk pricing.5:25–7:45 · Nathan pushing back 2/10 Origins from Custom Development to Pure SaaS Transformation Latka inquires about the transition from an agency dev shop to pure SaaS and examines Condeco's global headcount distribution and sales team structure.7:45–11:08 · Nathan pushing back 4/10 Sustained YoY Growth and Thirty Million Dollar Series A Latka calculates Condeco's run rate live by multiplying customer count and contract size, then digs into the timing and capital deployment of their thirty million dollar Series A.11:08–13:27 · Nathan pushing back 6/10 Historical SaaS Run Rate Trajectory and Hardware Gross Margins Latka halts the discussion to reconcile conflicting historical revenue figures between total revenue and pure SaaS run rate, challenging Statham on hardware gross margins.13:27–16:48 · Nathan pushing back 4/10 Hardware Attachment Rates and Software-Driven Customer Retention Latka references industry analogues with hardware-software combos and drills down on customer acquisition cost and payback periods across small versus enterprise clients.16:48–19:17 · Nathan pushing back 1/10 The Famous Five Questions with Paul Statham Latka guides Statham through the standard Famous Five rapid-fire questions and concludes with a recap of the company's vital statistics.

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

0:00 · Nathan 57.8% · guest 42.2%0:00 · Nathan 57.8% · guest 42.2%3:00 · Nathan 43.6% · guest 56.4%3:00 · Nathan 43.6% · guest 56.4%6:00 · Nathan 18.6% · guest 81.4%6:00 · Nathan 18.6% · guest 81.4%9:00 · Nathan 45.8% · guest 54.2%9:00 · Nathan 45.8% · guest 54.2%12:00 · Nathan 41.2% · guest 58.8%12:00 · Nathan 41.2% · guest 58.8%15:00 · Nathan 30.7% · guest 69.3%15:00 · Nathan 30.7% · guest 69.3%18:00 · Nathan 75.4% · guest 24.6%18:00 · Nathan 75.4% · guest 24.6%
Sharpest disagreement ▶ 11:55 Clarifying revenue timeline and metrics

Statham pushes back firmly to clarify that the apparent discrepancy in revenue figures stemmed from Latka mixing up total revenue with recurring SaaS run rate dates.

 Hardest push from Nathan ▶ 11:32 Latka challenges conflicting ARR numbers

Latka directly interrupts and refuses the numbers presented, explicitly stating he is confused because the figures don't align with earlier statements about 2016 revenue.

 Biggest teaching moment ▶ 12:56 Defending proprietary hardware gross margins

Statham educates Latka on their hardware economics, explaining that in-house manufacturing gives their hardware gross margins near-parity with software margins.

 Nathan holds their own ▶ 9:08 Rapid customer count to monthly revenue extrapolation

Latka demonstrates his financial fluency by multiplying the 1,200 customer count against average contract tiers to pinpoint their $4M per month run rate before Statham confirms it.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Host Overview of Condeco's Background and Growth Metrics 6112 Latka sets the stage with a comprehensive quantitative summary of Condeco's revenue, customer count, and metrics before prompting Statham to break down their revenue streams.
Revenue Percentage Breakdown and Enterprise Retention Performance 6213 Latka presses for precise definitions on gross versus net logo and revenue retention, then runs a hypothetical unit economics scenario on per-room and per-desk pricing.
Origins from Custom Development to Pure SaaS Transformation 5112 Latka inquires about the transition from an agency dev shop to pure SaaS and examines Condeco's global headcount distribution and sales team structure.
Sustained YoY Growth and Thirty Million Dollar Series A 7224 Latka calculates Condeco's run rate live by multiplying customer count and contract size, then digs into the timing and capital deployment of their thirty million dollar Series A.
Historical SaaS Run Rate Trajectory and Hardware Gross Margins 7326 Latka halts the discussion to reconcile conflicting historical revenue figures between total revenue and pure SaaS run rate, challenging Statham on hardware gross margins.
Hardware Attachment Rates and Software-Driven Customer Retention 6324 Latka references industry analogues with hardware-software combos and drills down on customer acquisition cost and payback periods across small versus enterprise clients.
The Famous Five Questions with Paul Statham 4111 Latka guides Statham through the standard Famous Five rapid-fire questions and concludes with a recap of the company's vital statistics.

Statements from this episode (15)

Disclosure
Paul Statham: Condeco generates 45% of revenue from subscriptions
“45% of our revenue is now through our subscription. About 20% is through services, and the rest is through hardware.”
Paul Statham Feb 5, 2020 ▶ 2:25
Disclosure
Paul Statham: Condeco maintains a 95% gross logo retention rate
“You know, we still have a 95% retention rate, which we're very pleased with.”
Paul Statham Feb 5, 2020 ▶ 2:58
Disclosure
Paul Statham: Condeco achieves roughly 122% net revenue retention
“And our net retention is about a 122%.”
Paul Statham Feb 5, 2020 ▶ 3:14
Disclosure
Statham: Condeco SaaS customer spend ranges from $2K to $40K monthly
“We have our, probably our smallest SAS is paying us around a couple of thousand dollars a month, and our largest could be paying us 30, 40,000 dollars a month.”
Paul Statham Feb 5, 2020 ▶ 4:07
Disclosure
Statham: Condeco charges $30/month to $800/year per managed room or desk
“It varies wildly, but depending on the size of the scale, but somewhere in a few hundred dollars, it starts at a few hundred dollars a year. So it can start as low as 30, 40 dollars a month. If you have it with all of the additions with signage and screens, it…”
Paul Statham Feb 5, 2020 ▶ 4:34
Assertion Supported
Statham: Condeco Migrated Completely from Perpetual Licenses to SaaS in 2015
“We started life back in the day as a perpetual license company. We migrated in 2015 to entirely SAS.”
Paul Statham Feb 5, 2020 ▶ 6:28
Assertion Not checkable as stated
Statham: Condeco Has Around 1,200 Total Customers
“Our total customer base is around 1200.”
Paul Statham Feb 5, 2020 ▶ 6:46
Assertion Not checkable as stated
Statham: Condeco Has 100 Sales and Marketing Staff
“No, we have a, we have over in our total sales team, sales and marketing accounts for about a hundred people within the business. We have a 10 man inside sales team. We have a 35 man outside sales team. We have channel teams. We have marketing teams.”
Paul Statham Feb 5, 2020 ▶ 6:55
Assertion Not checkable as stated
Statham: Condeco overall revenue is growing nearly 30% YoY, SaaS 40%
“We're going around just under 30% year on year, and our SaaS revenue is growing at around 40% year on year.”
Paul Statham Feb 5, 2020 ▶ 7:50
Disclosure
Statham: Condeco bootstrapped for 16 years before raising Highland capital
“Yeah, that's the only capital. We were bootstrapped for the first 16 years of our life. And we then because of our expansion was just getting so great that we took on some capital from Highland Europe.”
Paul Statham Feb 5, 2020 ▶ 8:06
Assertion Not checkable as stated
Statham: Condeco generates roughly $4M in monthly revenue
“Yeah, we have about, it's about four million bucks in revenue. Per month, yeah.”
Paul Statham Feb 5, 2020 ▶ 9:21
Assertion Not checkable as stated
Statham: Condeco had $12M to $15M revenue at funding
“About fifteen million dollars, 12, twelve million dollars.”
Paul Statham Feb 5, 2020 ▶ 9:39
Assertion Not checkable as stated
Statham: Condeco hardware gross margins are close to software margins
“They, professional services were discounted, but the hardware, because we manufacture it ourselves and it's got some unique properties within it. Our gross margin on our hardware is Fairly much quite, quite close to our gross margin on our software. So they we…”
Paul Statham Feb 5, 2020 ▶ 12:57
Assertion Not checkable as stated
Statham: 50% of Condeco Clients Use Hardware, Retention Matches Software Only
“50, 50% of our clients use our hardware. The rest of them are just software. And our retention is similar on both.”
Paul Statham Feb 5, 2020 ▶ 14:04
Assertion Not checkable as stated
Statham: Condeco CAC is roughly $200 for a $300/year room
“So if you break it down on a cost per acquisition for each room, it's around for a 300 dollar a year room, our cost of acquisition is coming out around 200 dollars.”
Paul Statham Feb 5, 2020 ▶ 15:34
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