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Jun 15, 2019 · 20m · top-founders

1421 How He IPO'd $2m ARR Company on Polish Exchange

Mike Sadowski · 10m spoken Nathan Latka · 7m spoken
0:00 / 0:00

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In this episode of The Top Entrepreneurs Podcast, host Nathan Latka interviews Brand24 CEO Mike Sadowski on scaling a social listening SaaS platform to $200,000 in monthly recurring revenue, achieving capital-efficient unit economics, and executing an unconventional IPO on the Polish Stock Exchange.

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 44.1% of the talking time here. How this is scored →

Nathan as informed peer 4.3 Guest teaching 2.8 Guest disagreement 1.5 Nathan pushing back 3.5
05100:0010:0020:000:01–2:31 · Nathan as informed peer 0/10 Promotion for Nathan Latka's Bestselling Book Nathan delivers a solo promotional monologue praising reviews for his book before introducing the episode teaser and metrics.2:31–6:02 · Nathan as informed peer 4/10 Introduction of Mike Sadowski and Customer Base Clarification Nathan introduces Mike and immediately clarifies paying customers versus free signups, while Mike explains Brand24's social listening tool and organic community marketing strategy.6:02–11:04 · Nathan as informed peer 6/10 Subscription Pricing and Monthly Revenue Breakdown Nathan interrupts Mike to drill into pricing and headcount math, questioning whether 65 employees burn cash against 200k MRR. Mike corrects Nathan's salary assumptions by explaining Polish labor costs are far lower.11:08–13:35 · Nathan as informed peer 4/10 Sponsor Announcement for Freshworks Freshchat Following an ad read, Nathan presses for 2017 annual revenue figures and explicitly clarifies that Mike is citing actual annual revenue rather than an annualized December run-rate.13:35–16:01 · Nathan as informed peer 6/10 The Decision to IPO on the Polish Stock Exchange Nathan pushes Mike on why a small company would take on the regulatory burdens of an IPO, while Mike educates him on the distinct advantages of the local Polish stock exchange compared to NASDAQ.16:01–19:25 · Nathan as informed peer 6/10 SaaS Unit Economics: Churn, CAC, and Lifetime Value Nathan repeatedly presses Mike to disambiguate logo churn from revenue churn and inspects customer acquisition economics before moving into the Famous Five questions.0:01–2:31 · Guest teaching 0/10 Promotion for Nathan Latka's Bestselling Book Nathan delivers a solo promotional monologue praising reviews for his book before introducing the episode teaser and metrics.2:31–6:02 · Guest teaching 3/10 Introduction of Mike Sadowski and Customer Base Clarification Nathan introduces Mike and immediately clarifies paying customers versus free signups, while Mike explains Brand24's social listening tool and organic community marketing strategy.6:02–11:04 · Guest teaching 4/10 Subscription Pricing and Monthly Revenue Breakdown Nathan interrupts Mike to drill into pricing and headcount math, questioning whether 65 employees burn cash against 200k MRR. Mike corrects Nathan's salary assumptions by explaining Polish labor costs are far lower.11:08–13:35 · Guest teaching 2/10 Sponsor Announcement for Freshworks Freshchat Following an ad read, Nathan presses for 2017 annual revenue figures and explicitly clarifies that Mike is citing actual annual revenue rather than an annualized December run-rate.13:35–16:01 · Guest teaching 5/10 The Decision to IPO on the Polish Stock Exchange Nathan pushes Mike on why a small company would take on the regulatory burdens of an IPO, while Mike educates him on the distinct advantages of the local Polish stock exchange compared to NASDAQ.16:01–19:25 · Guest teaching 3/10 SaaS Unit Economics: Churn, CAC, and Lifetime Value Nathan repeatedly presses Mike to disambiguate logo churn from revenue churn and inspects customer acquisition economics before moving into the Famous Five questions.0:01–2:31 · Guest disagreement 0/10 Promotion for Nathan Latka's Bestselling Book Nathan delivers a solo promotional monologue praising reviews for his book before introducing the episode teaser and metrics.2:31–6:02 · Guest disagreement 1/10 Introduction of Mike Sadowski and Customer Base Clarification Nathan introduces Mike and immediately clarifies paying customers versus free signups, while Mike explains Brand24's social listening tool and organic community marketing strategy.6:02–11:04 · Guest disagreement 2/10 Subscription Pricing and Monthly Revenue Breakdown Nathan interrupts Mike to drill into pricing and headcount math, questioning whether 65 employees burn cash against 200k MRR. Mike corrects Nathan's salary assumptions by explaining Polish labor costs are far lower.11:08–13:35 · Guest disagreement 1/10 Sponsor Announcement for Freshworks Freshchat Following an ad read, Nathan presses for 2017 annual revenue figures and explicitly clarifies that Mike is citing actual annual revenue rather than an annualized December run-rate.13:35–16:01 · Guest disagreement 3/10 The Decision to IPO on the Polish Stock Exchange Nathan pushes Mike on why a small company would take on the regulatory burdens of an IPO, while Mike educates him on the distinct advantages of the local Polish stock exchange compared to NASDAQ.16:01–19:25 · Guest disagreement 2/10 SaaS Unit Economics: Churn, CAC, and Lifetime Value Nathan repeatedly presses Mike to disambiguate logo churn from revenue churn and inspects customer acquisition economics before moving into the Famous Five questions.0:01–2:31 · Nathan pushing back 0/10 Promotion for Nathan Latka's Bestselling Book Nathan delivers a solo promotional monologue praising reviews for his book before introducing the episode teaser and metrics.2:31–6:02 · Nathan pushing back 2/10 Introduction of Mike Sadowski and Customer Base Clarification Nathan introduces Mike and immediately clarifies paying customers versus free signups, while Mike explains Brand24's social listening tool and organic community marketing strategy.6:02–11:04 · Nathan pushing back 5/10 Subscription Pricing and Monthly Revenue Breakdown Nathan interrupts Mike to drill into pricing and headcount math, questioning whether 65 employees burn cash against 200k MRR. Mike corrects Nathan's salary assumptions by explaining Polish labor costs are far lower.11:08–13:35 · Nathan pushing back 3/10 Sponsor Announcement for Freshworks Freshchat Following an ad read, Nathan presses for 2017 annual revenue figures and explicitly clarifies that Mike is citing actual annual revenue rather than an annualized December run-rate.13:35–16:01 · Nathan pushing back 6/10 The Decision to IPO on the Polish Stock Exchange Nathan pushes Mike on why a small company would take on the regulatory burdens of an IPO, while Mike educates him on the distinct advantages of the local Polish stock exchange compared to NASDAQ.16:01–19:25 · Nathan pushing back 5/10 SaaS Unit Economics: Churn, CAC, and Lifetime Value Nathan repeatedly presses Mike to disambiguate logo churn from revenue churn and inspects customer acquisition economics before moving into the Famous Five questions.

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

0:00 · Nathan 98.6% · guest 1.4%0:00 · Nathan 98.6% · guest 1.4%3:00 · Nathan 8.8% · guest 91.2%3:00 · Nathan 8.8% · guest 91.2%6:00 · Nathan 32.7% · guest 67.3%6:00 · Nathan 32.7% · guest 67.3%9:00 · Nathan 48.3% · guest 51.7%9:00 · Nathan 48.3% · guest 51.7%12:00 · Nathan 37.8% · guest 62.2%12:00 · Nathan 37.8% · guest 62.2%15:00 · Nathan 34.2% · guest 65.8%15:00 · Nathan 34.2% · guest 65.8%18:00 · Nathan 48.4% · guest 51.6%18:00 · Nathan 48.4% · guest 51.6%
Sharpest disagreement ▶ 15:02 Rejecting post-IPO slowdown premise

Mike rejects Nathan's assertion that going public added excessive red tape and shareholder slowdowns, explaining they were already operating transparently.

 Hardest push from Nathan ▶ 9:41 Challenging cash burn on headcount

Nathan interrupts Mike to perform back-of-the-napkin math on 65 employees, challenging whether the company is heavily burning cash against $200k MRR.

 Biggest teaching moment ▶ 13:35 Educating on local European exchange IPOs

Mike explains that unlike the high revenue thresholds required by NASDAQ, regional stock exchanges like Poland's provide viable micro-cap IPO options for raising $1 million.

 Nathan holds their own ▶ 9:41 Instant headcount burn calculation

Nathan demonstrates operational SaaS expertise by instantly calculating estimated payroll costs at $60k per head against reported MRR to determine profitability.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Promotion for Nathan Latka's Bestselling Book 0000 Nathan delivers a solo promotional monologue praising reviews for his book before introducing the episode teaser and metrics.
Introduction of Mike Sadowski and Customer Base Clarification 4312 Nathan introduces Mike and immediately clarifies paying customers versus free signups, while Mike explains Brand24's social listening tool and organic community marketing strategy.
Subscription Pricing and Monthly Revenue Breakdown 6425 Nathan interrupts Mike to drill into pricing and headcount math, questioning whether 65 employees burn cash against 200k MRR. Mike corrects Nathan's salary assumptions by explaining Polish labor costs are far lower.
Sponsor Announcement for Freshworks Freshchat 4213 Following an ad read, Nathan presses for 2017 annual revenue figures and explicitly clarifies that Mike is citing actual annual revenue rather than an annualized December run-rate.
The Decision to IPO on the Polish Stock Exchange 6536 Nathan pushes Mike on why a small company would take on the regulatory burdens of an IPO, while Mike educates him on the distinct advantages of the local Polish stock exchange compared to NASDAQ.
SaaS Unit Economics: Churn, CAC, and Lifetime Value 6325 Nathan repeatedly presses Mike to disambiguate logo churn from revenue churn and inspects customer acquisition economics before moving into the Famous Five questions.

Statements from this episode (13)

Assertion Supported
Sadowski: Brand24 has over 2,000 active paying customers
“Yeah. We have many more signups. However, those are only active paying customers. So the ones that count into MRR.”
Mike Sadowski Jun 15, 2019 ▶ 3:04
Assertion Not checkable as stated
Sadowski: Brand24 gets over 1,000 monthly signups from community marketing
“Currently over a thousand signups a month is based on the let's say something we call community marketing.”
Mike Sadowski Jun 15, 2019 ▶ 4:42
Disclosure
Sadowski: Brand24's Average Revenue Per User Is Typically $100 Monthly
“Typically a hundred dollars a month. That's the average revenue per user per month.”
Mike Sadowski Jun 15, 2019 ▶ 6:10
Insight
Sadowski: Global SaaS buyers do not care where software is built
“One of the things that shocked me that you, that actually customers from all over the world, they don't mind buying the product. If it's good enough, they don't mind if it's from, you know, based in Poland or anywhere.”
Mike Sadowski Jun 15, 2019 ▶ 7:59
Assertion Partly supported
Sadowski: Over 90% of Brand24's $6M cumulative costs were customer-funded
“Mostly bootstrap out of the let's say six million dollars that took us of costs that, that took us to the place where we are at the moment probably 300 K, no three, 400 K dollars was the external funding. The rest is bootstrap. So over 90% of the costs were fi…”
Mike Sadowski Jun 15, 2019 ▶ 8:15
Insight
Sadowski: Running SaaS on Polish costs while charging in dollars creates leverage
“Yeah, that's the beauty of the work right now that we can run this business with poll, let's say Polish costs while charging in dollar.”
Mike Sadowski Jun 15, 2019 ▶ 10:27
Opinion
Sadowski: Local stock exchanges in Poland offer a viable IPO capital alternative
“For the local IPO in Poland on local stock exchange, which is still it's pretty good option for raising capital. those, you know, other other, other stock exchange markets than the NASDAQ. And New York Stock Exchange. it's a viable option.”
Mike Sadowski Jun 15, 2019 ▶ 13:48
Disclosure
Brand24 raised $1M in its Polish IPO
“Just one million dollars November last year.”
Mike Sadowski Jun 15, 2019 ▶ 14:12
Opinion
Sadowski: Operating post-IPO presents no huge downside to company workflow
“Post IPO, it's not much different than before that. So I don't see a huge downside in terms of workflow.”
Mike Sadowski Jun 15, 2019 ▶ 15:13
Disclosure
Brand24 CEO: Monthly Customer Churn Is Between 5% and 7%
“The churn is currently more or less at five to seven percent ballpark.”
Mike Sadowski Jun 15, 2019 ▶ 16:07
Disclosure
Brand24 Revenue Churn Is Lower Because Lost Accounts Are Cheaper
“The revenue churn is significantly lower because we tend to lose the cheapest customers.”
Mike Sadowski Jun 15, 2019 ▶ 16:38
Disclosure
Brand24 CAC Is Around $280 With a Three-Month Payback Period
“At the moment it's around 280 dollars. So the return on customer acquisition cost is on average after three months.”
Mike Sadowski Jun 15, 2019 ▶ 17:09
Disclosure
Brand24 Estimates Minimum Customer Lifetime Value at Around $1,500
“That would be around 1500 dollars.”
Mike Sadowski Jun 15, 2019 ▶ 17:35
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