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May 29, 2018 · 17m · top-founders

1039 The Argument For Utility Based SaaS Pricing, $.85 Per Booked Hour, 18.4 Million Booked Hours

Greg Tanaka · 9m spoken Nathan Latka · 5m spoken
0:00 / 0:00

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Nathan Latka interviews Percolata founder and CEO Greg Tanaka to discuss how the company's AI-powered workforce scheduling platform uses utility-based pricing ($0.85 per scheduled hour) across 18.4 million contracted hours to deliver a 10% to 30% sales lift for physical retailers.

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 37.9% of the talking time here. How this is scored →

Nathan as informed peer 4.0 Guest teaching 3.2 Guest disagreement 1.4 Nathan pushing back 2.4
05100:0010:000:49–4:41 · Nathan as informed peer 5/10 Introducing Greg Tanaka and Percolata Nathan offers a concrete hypothetical retail scenario to test his understanding of the model, which Greg validates. Greg then educates Nathan on the shopper yield metric and clarifies that they optimize existing staff schedules rather than requiring new hires.4:41–8:25 · Nathan as informed peer 5/10 Utility-Based Pricing Model and Integration Challenges Nathan astutely points out the onboarding and sales cycle challenges inherent to utility-based pricing. Greg agrees and explains the technical enterprise integrations and the multi-year journey to finding product-market fit.8:28–11:17 · Nathan as informed peer 6/10 Contracted Volume, Sales Lift, and Twin Store Testing Nathan quickly runs the math on 18.4 million hours at $0.85 to arrive at a $15.6M run rate, pushing Greg on whether they actually recognized over $10M. Greg clarifies that contracted hours include undelivered pilots and explains their twin-store testing methodology.11:21–13:22 · Nathan as informed peer 2/10 Sponsor Spotlight: ProsperWorks CRM The segment begins with a sponsor monologue before Nathan pivots to ask for location counts. Greg rejects the framing of tracking raw location counts and reframes the metric around scheduled hours and enterprise logos.13:23–16:28 · Nathan as informed peer 2/10 The Famous Five Fast-Paced Questionnaire Nathan runs through the standard Famous Five questionnaire in a collaborative rhythm. Greg provides candid reflections on startup difficulties and overcoming engineer arrogance regarding CEO roles.0:49–4:41 · Guest teaching 4/10 Introducing Greg Tanaka and Percolata Nathan offers a concrete hypothetical retail scenario to test his understanding of the model, which Greg validates. Greg then educates Nathan on the shopper yield metric and clarifies that they optimize existing staff schedules rather than requiring new hires.4:41–8:25 · Guest teaching 3/10 Utility-Based Pricing Model and Integration Challenges Nathan astutely points out the onboarding and sales cycle challenges inherent to utility-based pricing. Greg agrees and explains the technical enterprise integrations and the multi-year journey to finding product-market fit.8:28–11:17 · Guest teaching 4/10 Contracted Volume, Sales Lift, and Twin Store Testing Nathan quickly runs the math on 18.4 million hours at $0.85 to arrive at a $15.6M run rate, pushing Greg on whether they actually recognized over $10M. Greg clarifies that contracted hours include undelivered pilots and explains their twin-store testing methodology.11:21–13:22 · Guest teaching 4/10 Sponsor Spotlight: ProsperWorks CRM The segment begins with a sponsor monologue before Nathan pivots to ask for location counts. Greg rejects the framing of tracking raw location counts and reframes the metric around scheduled hours and enterprise logos.13:23–16:28 · Guest teaching 1/10 The Famous Five Fast-Paced Questionnaire Nathan runs through the standard Famous Five questionnaire in a collaborative rhythm. Greg provides candid reflections on startup difficulties and overcoming engineer arrogance regarding CEO roles.0:49–4:41 · Guest disagreement 1/10 Introducing Greg Tanaka and Percolata Nathan offers a concrete hypothetical retail scenario to test his understanding of the model, which Greg validates. Greg then educates Nathan on the shopper yield metric and clarifies that they optimize existing staff schedules rather than requiring new hires.4:41–8:25 · Guest disagreement 1/10 Utility-Based Pricing Model and Integration Challenges Nathan astutely points out the onboarding and sales cycle challenges inherent to utility-based pricing. Greg agrees and explains the technical enterprise integrations and the multi-year journey to finding product-market fit.8:28–11:17 · Guest disagreement 2/10 Contracted Volume, Sales Lift, and Twin Store Testing Nathan quickly runs the math on 18.4 million hours at $0.85 to arrive at a $15.6M run rate, pushing Greg on whether they actually recognized over $10M. Greg clarifies that contracted hours include undelivered pilots and explains their twin-store testing methodology.11:21–13:22 · Guest disagreement 3/10 Sponsor Spotlight: ProsperWorks CRM The segment begins with a sponsor monologue before Nathan pivots to ask for location counts. Greg rejects the framing of tracking raw location counts and reframes the metric around scheduled hours and enterprise logos.13:23–16:28 · Guest disagreement 0/10 The Famous Five Fast-Paced Questionnaire Nathan runs through the standard Famous Five questionnaire in a collaborative rhythm. Greg provides candid reflections on startup difficulties and overcoming engineer arrogance regarding CEO roles.0:49–4:41 · Nathan pushing back 2/10 Introducing Greg Tanaka and Percolata Nathan offers a concrete hypothetical retail scenario to test his understanding of the model, which Greg validates. Greg then educates Nathan on the shopper yield metric and clarifies that they optimize existing staff schedules rather than requiring new hires.4:41–8:25 · Nathan pushing back 2/10 Utility-Based Pricing Model and Integration Challenges Nathan astutely points out the onboarding and sales cycle challenges inherent to utility-based pricing. Greg agrees and explains the technical enterprise integrations and the multi-year journey to finding product-market fit.8:28–11:17 · Nathan pushing back 5/10 Contracted Volume, Sales Lift, and Twin Store Testing Nathan quickly runs the math on 18.4 million hours at $0.85 to arrive at a $15.6M run rate, pushing Greg on whether they actually recognized over $10M. Greg clarifies that contracted hours include undelivered pilots and explains their twin-store testing methodology.11:21–13:22 · Nathan pushing back 2/10 Sponsor Spotlight: ProsperWorks CRM The segment begins with a sponsor monologue before Nathan pivots to ask for location counts. Greg rejects the framing of tracking raw location counts and reframes the metric around scheduled hours and enterprise logos.13:23–16:28 · Nathan pushing back 1/10 The Famous Five Fast-Paced Questionnaire Nathan runs through the standard Famous Five questionnaire in a collaborative rhythm. Greg provides candid reflections on startup difficulties and overcoming engineer arrogance regarding CEO roles.

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

0:00 · Nathan 72.8% · guest 27.2%0:00 · Nathan 72.8% · guest 27.2%3:00 · Nathan 15.1% · guest 84.9%3:00 · Nathan 15.1% · guest 84.9%6:00 · Nathan 14.4% · guest 85.6%6:00 · Nathan 14.4% · guest 85.6%9:00 · Nathan 36.2% · guest 63.8%9:00 · Nathan 36.2% · guest 63.8%12:00 · Nathan 42.7% · guest 57.3%12:00 · Nathan 42.7% · guest 57.3%15:00 · Nathan 47.9% · guest 52.1%15:00 · Nathan 47.9% · guest 52.1%
Sharpest disagreement ▶ 12:50 Tanaka reframes customer counting metric

When Nathan presses for exact store location figures, Greg directly pushes back on the question's premise, stating they do not evaluate their business by store count.

 Hardest push from Nathan ▶ 9:10 Latka interrogates recognized revenue vs contract value

Nathan refuses to accept the implicit $15.6M run-rate calculation without verifying whether Percolata actually exceeded $10M in collected revenue.

 Biggest teaching moment ▶ 9:20 Tanaka breaks down enterprise delivery lag and pilot mechanics

Greg corrects Nathan's assumption of immediate revenue realization by explaining how enterprise pilot contracts require staged product deployment before billing fully kicks in.

 Nathan holds their own ▶ 9:10 Latka's rapid mental math on contract value

Nathan instantly calculates the implied annual run rate ($15.6M) from Greg's volume and unit pricing metrics to hold the guest accountable to actual revenue milestones.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Introducing Greg Tanaka and Percolata 5412 Nathan offers a concrete hypothetical retail scenario to test his understanding of the model, which Greg validates. Greg then educates Nathan on the shopper yield metric and clarifies that they optimize existing staff schedules rather than requiring new hires.
Utility-Based Pricing Model and Integration Challenges 5312 Nathan astutely points out the onboarding and sales cycle challenges inherent to utility-based pricing. Greg agrees and explains the technical enterprise integrations and the multi-year journey to finding product-market fit.
Contracted Volume, Sales Lift, and Twin Store Testing 6425 Nathan quickly runs the math on 18.4 million hours at $0.85 to arrive at a $15.6M run rate, pushing Greg on whether they actually recognized over $10M. Greg clarifies that contracted hours include undelivered pilots and explains their twin-store testing methodology.
Sponsor Spotlight: ProsperWorks CRM 2432 The segment begins with a sponsor monologue before Nathan pivots to ask for location counts. Greg rejects the framing of tracking raw location counts and reframes the metric around scheduled hours and enterprise logos.
The Famous Five Fast-Paced Questionnaire 2101 Nathan runs through the standard Famous Five questionnaire in a collaborative rhythm. Greg provides candid reflections on startup difficulties and overcoming engineer arrogance regarding CEO roles.

Statements from this episode (9)

Insight
Tanaka: Top retail salespeople deliver nearly 10x the shopper yield of average staff
“So first of all, we look at a metric called shopper yield. So the top salespeople will have a shopper yield metric of almost 10 X what the average salesperson will do.”
Greg Tanaka May 29, 2018 ▶ 3:05
Disclosure
Tanaka: Percolata charges $0.85 per scheduled hour
“The way we make money is we charge per scheduled hour. So for every hour that we schedule, we get 85 cents per hour.”
Greg Tanaka May 29, 2018 ▶ 4:47
Disclosure
Tanaka: Percolata has raised $9.5M in total funding
“We raised 9.5 million.”
Greg Tanaka May 29, 2018 ▶ 6:19
Assertion Not checkable as stated
Tanaka: Percolata has over 18.4 million hours contracted annually
“So we have under contract over 18.4 million hours annually.”
Greg Tanaka May 29, 2018 ▶ 8:37
Prediction Not checkable as stated
Tanaka predicts Percolata will pass $10M revenue in 2018
“It's very good chance.”
Greg Tanaka May 29, 2018 ▶ 9:56
Assertion Not checkable as stated
Tanaka: Percolata delivers retail clients $20 to $40 extra revenue per dollar spent
“So essentially for every dollar that they pay us, they get about 20 to 30 dollars back, sometimes even 40 dollars back in terms of return on investment. So they get massive return in terms of every dollar they pay us, they get about 20 to 40 dollars in terms o…”
Greg Tanaka May 29, 2018 ▶ 10:23
Assertion Not checkable as stated
Tanaka: Percolata scheduling generates a 10% to 30% revenue boost for stores
“So for the store that we schedule and we're able to show generally between 10 to 30% boost in revenue, depending on what the, what's going on.”
Greg Tanaka May 29, 2018 ▶ 10:53
Assertion Not checkable as stated
Tanaka: Percolata has 40 total brand logos worldwide
“We have 40 logos total worldwide.”
Greg Tanaka May 29, 2018 ▶ 13:09
Disclosure
Ben Horowitz and Andreessen Horowitz are investors in Percolata
“It's a book written by one of our investors from Jason Horitz Ben Horitz”
Greg Tanaka May 29, 2018 ▶ 13:29
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