StarZero All shows Try the podcast clipper →

Jul 30, 2018 · 17m · top-founders

1101 Bloomreach CEO: We've turned down acquisition offers in $400m range

Raj De Datta · 10m spoken Nathan Latka · 5m spoken
0:00 / 0:00

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

In this episode of The Top Entrepreneurs Podcast, host Nathan Latka interviews Bloomreach co-founder and CEO Raj De Datta to explore the company's enterprise SaaS business model, path toward $100 million in ARR, and the decision to turn down $400 million acquisition offers.

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 32.9% of the talking time here. How this is scored →

Nathan as informed peer 5.8 Guest teaching 3.6 Guest disagreement 1.8 Nathan pushing back 3.4
05100:0010:001:30–3:54 · Nathan as informed peer 6/10 Bloomreach Platform Overview and Enterprise SaaS Model Nathan inquires into Bloomreach's enterprise SaaS business model and unpacks the expansion levers, summarizing how multi-brand deployments, page views, and product upsells expand contract values.3:55–6:42 · Nathan as informed peer 5/10 Bloomreach Founding Story, Technical AI Vision, and Early Funding Nathan points out that raising a five million dollar seed round required elite founding credentials, prompting Raj to detail how they pitched mitigating machine learning technical risk.6:45–10:16 · Nathan as informed peer 7/10 Customer Scale, Annual Revenue Run Rate, and Professional Services Nathan actively calculates the revenue run rate by multiplying account counts by average contract value, drilling in to confirm whether services revenue is included.10:17–15:26 · Nathan as informed peer 7/10 Evaluating Acquisition Offers and Managing Entrepreneurial Risk Nathan pushes hard when Raj uses evasive phrasing like growing 'really nicely', demanding concrete growth percentages before Raj holds his boundary.15:27–16:54 · Nathan as informed peer 4/10 The Famous Five Rapid-Fire Questions The conversation moves into the standard rapid-fire format with friendly answers regarding books, tools, sleep, and founder age.1:30–3:54 · Guest teaching 3/10 Bloomreach Platform Overview and Enterprise SaaS Model Nathan inquires into Bloomreach's enterprise SaaS business model and unpacks the expansion levers, summarizing how multi-brand deployments, page views, and product upsells expand contract values.3:55–6:42 · Guest teaching 4/10 Bloomreach Founding Story, Technical AI Vision, and Early Funding Nathan points out that raising a five million dollar seed round required elite founding credentials, prompting Raj to detail how they pitched mitigating machine learning technical risk.6:45–10:16 · Guest teaching 4/10 Customer Scale, Annual Revenue Run Rate, and Professional Services Nathan actively calculates the revenue run rate by multiplying account counts by average contract value, drilling in to confirm whether services revenue is included.10:17–15:26 · Guest teaching 5/10 Evaluating Acquisition Offers and Managing Entrepreneurial Risk Nathan pushes hard when Raj uses evasive phrasing like growing 'really nicely', demanding concrete growth percentages before Raj holds his boundary.15:27–16:54 · Guest teaching 2/10 The Famous Five Rapid-Fire Questions The conversation moves into the standard rapid-fire format with friendly answers regarding books, tools, sleep, and founder age.1:30–3:54 · Guest disagreement 1/10 Bloomreach Platform Overview and Enterprise SaaS Model Nathan inquires into Bloomreach's enterprise SaaS business model and unpacks the expansion levers, summarizing how multi-brand deployments, page views, and product upsells expand contract values.3:55–6:42 · Guest disagreement 1/10 Bloomreach Founding Story, Technical AI Vision, and Early Funding Nathan points out that raising a five million dollar seed round required elite founding credentials, prompting Raj to detail how they pitched mitigating machine learning technical risk.6:45–10:16 · Guest disagreement 2/10 Customer Scale, Annual Revenue Run Rate, and Professional Services Nathan actively calculates the revenue run rate by multiplying account counts by average contract value, drilling in to confirm whether services revenue is included.10:17–15:26 · Guest disagreement 4/10 Evaluating Acquisition Offers and Managing Entrepreneurial Risk Nathan pushes hard when Raj uses evasive phrasing like growing 'really nicely', demanding concrete growth percentages before Raj holds his boundary.15:27–16:54 · Guest disagreement 1/10 The Famous Five Rapid-Fire Questions The conversation moves into the standard rapid-fire format with friendly answers regarding books, tools, sleep, and founder age.1:30–3:54 · Nathan pushing back 2/10 Bloomreach Platform Overview and Enterprise SaaS Model Nathan inquires into Bloomreach's enterprise SaaS business model and unpacks the expansion levers, summarizing how multi-brand deployments, page views, and product upsells expand contract values.3:55–6:42 · Nathan pushing back 2/10 Bloomreach Founding Story, Technical AI Vision, and Early Funding Nathan points out that raising a five million dollar seed round required elite founding credentials, prompting Raj to detail how they pitched mitigating machine learning technical risk.6:45–10:16 · Nathan pushing back 4/10 Customer Scale, Annual Revenue Run Rate, and Professional Services Nathan actively calculates the revenue run rate by multiplying account counts by average contract value, drilling in to confirm whether services revenue is included.10:17–15:26 · Nathan pushing back 7/10 Evaluating Acquisition Offers and Managing Entrepreneurial Risk Nathan pushes hard when Raj uses evasive phrasing like growing 'really nicely', demanding concrete growth percentages before Raj holds his boundary.15:27–16:54 · Nathan pushing back 2/10 The Famous Five Rapid-Fire Questions The conversation moves into the standard rapid-fire format with friendly answers regarding books, tools, sleep, and founder age.

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

0:00 · Nathan 50% · guest 50%0:00 · Nathan 50% · guest 50%3:00 · Nathan 21.6% · guest 78.4%3:00 · Nathan 21.6% · guest 78.4%6:00 · Nathan 29.7% · guest 70.3%6:00 · Nathan 29.7% · guest 70.3%9:00 · Nathan 23.9% · guest 76.1%9:00 · Nathan 23.9% · guest 76.1%12:00 · Nathan 23.1% · guest 76.9%12:00 · Nathan 23.1% · guest 76.9%15:00 · Nathan 52.1% · guest 47.9%15:00 · Nathan 52.1% · guest 47.9%
Sharpest disagreement ▶ 14:28 Raj refuses to disclose specific growth rates

Raj firmly resists Nathan's multiple attempts to extract an exact percentage, reiterating that he will not dive into specific growth rates beyond his broad ARR band.

 Hardest push from Nathan ▶ 14:23 Nathan challenges vague growth terminology

Nathan directly calls out Raj's vague claim of growing 'really nicely', telling him the audience needs real numbers rather than subjective descriptions.

 Biggest teaching moment ▶ 12:23 Raj explains the limits of spreadsheet LTV/CAC models

Raj educates Nathan on enterprise risk management, explaining that theoretical Excel lifetime value divided by churn is unreliable when contracts outlast company operating history.

 Nathan holds their own ▶ 7:18 Nathan reverse-engineers Bloomreach run rate

Nathan instantly calculates run-rate figures in real time from customer count and ACV, probing whether professional services artificially inflated the figures.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Bloomreach Platform Overview and Enterprise SaaS Model 6312 Nathan inquires into Bloomreach's enterprise SaaS business model and unpacks the expansion levers, summarizing how multi-brand deployments, page views, and product upsells expand contract values.
Bloomreach Founding Story, Technical AI Vision, and Early Funding 5412 Nathan points out that raising a five million dollar seed round required elite founding credentials, prompting Raj to detail how they pitched mitigating machine learning technical risk.
Customer Scale, Annual Revenue Run Rate, and Professional Services 7424 Nathan actively calculates the revenue run rate by multiplying account counts by average contract value, drilling in to confirm whether services revenue is included.
Evaluating Acquisition Offers and Managing Entrepreneurial Risk 7547 Nathan pushes hard when Raj uses evasive phrasing like growing 'really nicely', demanding concrete growth percentages before Raj holds his boundary.
The Famous Five Rapid-Fire Questions 4212 The conversation moves into the standard rapid-fire format with friendly answers regarding books, tools, sleep, and founder age.

Statements from this episode (13)

Assertion Not checkable as stated
Bloomreach averages $250,000 contracts with multiple million-dollar clients.
“Average ASP for us is around 250 K per year. We've got several clients that pay us more than a million dollars a year.”
Raj De Datta Jul 30, 2018 ▶ 2:52
Assertion Supported
Bain Capital partner Ajay Agarwal invested the initial $5 million.
“Eventually we had our first investor, Ajay Agarwal, who's a partner at Bain Capital Ventures. He put in the initial five million dollars”
Raj De Datta Jul 30, 2018 ▶ 4:58
Assertion Supported
Bloomreach has raised $100 million in total funding to date.
“So today we've raised a hundred million dollars.”
Raj De Datta Jul 30, 2018 ▶ 5:42
Assertion Not checkable as stated
Bloomreach serves 250 enterprise clients across over 1,000 websites and apps.
“So we work with about 250 large enterprises and they have tens of brands each. So if you think about it in terms of websites or apps, it's probably a thousand plus. If you think about it in terms of companies, it's probably 250.”
Raj De Datta Jul 30, 2018 ▶ 6:47
Assertion Not checkable as stated
Bloomreach generates between $50 million and $100 million in annual revenue.
“And you can think of the scale of the business as being between 50 and a hundred million dollars.”
Raj De Datta Jul 30, 2018 ▶ 7:14
Assertion Not checkable as stated
Bloomreach maintains 10% to 12% gross revenue churn with net-zero churn.
“Gross churn for an enterprise business, we think best in class, you know, you want to be at no more than, say, 10 to 12% gross churn, and we're in that range, and then you want to be Pretty close to zero percent net churn or negative net churn, and we are ther…”
Raj De Datta Jul 30, 2018 ▶ 8:36
Assertion Not publicly verifiable
De Datta estimates Adobe holds $1.2B in Bloomreach's $8B addressable market.
“What's interesting in our space is I think we are very much a challenger in an eight billion dollar market that is dominated by people like Adobe that have a 1.2 billion dollar software revenue stream in our market.”
Raj De Datta Jul 30, 2018 ▶ 9:35
Disclosure
Bloomreach rejected multiple acquisition offers in the $400 million range.
“Well, I think it's fair to say that we've received very healthy acquisition offers, you know, at or around that range and turned them down.”
Raj De Datta Jul 30, 2018 ▶ 10:10
Disclosure
Host Nathan Latka regrets rejecting a life-changing buyout due to ego.
“I'll never forget the mistake I made at my first company where I turned down an acquisition offer that would have changed my life, but I'm like, you know what? I read that Mark turned down Yahoo for a billion and you know what? My dick's big too. So I'm going …”
Nathan Latka Jul 30, 2018 ▶ 10:21
Insight
De Datta notes founders inevitably experience regret after rejecting acquisition offers.
“Every time you turn down one of these things, the moment that I've talked to every entrepreneur about is you have that. Oh shit moment after you say no, or something that happens in your life, man, I should have taken that deal. Right. And you got to know that…”
Raj De Datta Jul 30, 2018 ▶ 11:04
Assertion Not checkable as stated
Bloomreach enterprise customer accounts remain with the company for 5-7 years.
“You know, I think in, in our kind of business, these accounts are with us for a minimum of, you know, five to seven years.”
Raj De Datta Jul 30, 2018 ▶ 11:52
Disclosure
Bloomreach targets a one-year customer acquisition cost payback period.
“Where we are today, we tend to spend sales and marketing at a ratio of about a one CAC ratio. Right. A one year payback period basically.”
Raj De Datta Jul 30, 2018 ▶ 12:46
Prediction Not checkable as stated
Bloomreach projects hitting $100 million ARR profitably with 40% growth.
“The intention for the company is to get to a point where the company, when it crosses a hundred million dollars, it's a profitable company growing at 40 to 50% year over year. And we're on track of that.”
Raj De Datta Jul 30, 2018 ▶ 14:03
Made with StarZero

Turn any episode into a week of clips.

This entire site, over 2,600 episodes transcribed, diarized, checked and made playable, runs on the StarZero media pipeline. Drop in your own episode and the podcast clipper finds the moments worth sharing, cuts them, captions them, and reframes them for every feed.

Try the podcast clipper Learn more