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Feb 28, 2018 · 20m · top-founders

949 API Plubming for Internet Passes 200 Customers, $10m ARR

Mark Geene · 11m spoken Nathan Latka · 6m spoken
0:00 / 0:00

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

Cloud Elements CEO Mark Geene discusses how his API integration platform scaled from a bootstrapped consulting concept to over $10 million in ARR across 200 enterprise OEM customers. Geene details the company's hub-based architecture, unit economics, fundraising history, and growth strategies within the rapidly expanding API economy.

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 35.8% of the talking time here. How this is scored →

Nathan as informed peer 4.3 Guest teaching 2.7 Guest disagreement 1.2 Nathan pushing back 2.5
05100:0010:0020:000:49–3:03 · Nathan as informed peer 4/10 Defining Cloud Elements and the API Integration Frontier Nathan asks Mark to clarify Cloud Elements' value proposition compared to Zapier or Segment. Mark explains enterprise service buses and API orchestration in non-technical terms.3:03–6:55 · Nathan as informed peer 5/10 Pricing Architecture, Founding Story, and Equity Distribution Mark outlines the pricing structure, early bootstrapped consulting period, and how the four co-founders divided equity using market benchmarks.6:55–11:32 · Nathan as informed peer 7/10 OEM Distribution, Rapid Revenue Growth, and Market Horizons Nathan models ARR estimates from customer counts and ASP. Mark corrects the math due to historic ASP expansion, and Nathan pushes on whether they will exit or raise more venture funding.11:35–17:28 · Nathan as informed peer 6/10 Sponsor Spotlight: Simplifying Document Signing with SignEasy Following a sponsor read, Nathan explores customer acquisition spend and models allowable CAC based on gross margins and a 12-month payback target.17:28–19:31 · Nathan as informed peer 4/10 First Customer Origins, Low Churn, and The Famous Five Nathan asks for churn figures and conducts the Famous Five, lightly pressing Mark when he hesitates to share his age.19:31–20:03 · Nathan as informed peer 0/10 Episode Summary and Key Metrics Recap Solo host wrap-up summarizing Cloud Elements' founding story, customer count, capital raised, and ARR trajectory.0:49–3:03 · Guest teaching 4/10 Defining Cloud Elements and the API Integration Frontier Nathan asks Mark to clarify Cloud Elements' value proposition compared to Zapier or Segment. Mark explains enterprise service buses and API orchestration in non-technical terms.3:03–6:55 · Guest teaching 3/10 Pricing Architecture, Founding Story, and Equity Distribution Mark outlines the pricing structure, early bootstrapped consulting period, and how the four co-founders divided equity using market benchmarks.6:55–11:32 · Guest teaching 4/10 OEM Distribution, Rapid Revenue Growth, and Market Horizons Nathan models ARR estimates from customer counts and ASP. Mark corrects the math due to historic ASP expansion, and Nathan pushes on whether they will exit or raise more venture funding.11:35–17:28 · Guest teaching 3/10 Sponsor Spotlight: Simplifying Document Signing with SignEasy Following a sponsor read, Nathan explores customer acquisition spend and models allowable CAC based on gross margins and a 12-month payback target.17:28–19:31 · Guest teaching 2/10 First Customer Origins, Low Churn, and The Famous Five Nathan asks for churn figures and conducts the Famous Five, lightly pressing Mark when he hesitates to share his age.19:31–20:03 · Guest teaching 0/10 Episode Summary and Key Metrics Recap Solo host wrap-up summarizing Cloud Elements' founding story, customer count, capital raised, and ARR trajectory.0:49–3:03 · Guest disagreement 1/10 Defining Cloud Elements and the API Integration Frontier Nathan asks Mark to clarify Cloud Elements' value proposition compared to Zapier or Segment. Mark explains enterprise service buses and API orchestration in non-technical terms.3:03–6:55 · Guest disagreement 1/10 Pricing Architecture, Founding Story, and Equity Distribution Mark outlines the pricing structure, early bootstrapped consulting period, and how the four co-founders divided equity using market benchmarks.6:55–11:32 · Guest disagreement 2/10 OEM Distribution, Rapid Revenue Growth, and Market Horizons Nathan models ARR estimates from customer counts and ASP. Mark corrects the math due to historic ASP expansion, and Nathan pushes on whether they will exit or raise more venture funding.11:35–17:28 · Guest disagreement 1/10 Sponsor Spotlight: Simplifying Document Signing with SignEasy Following a sponsor read, Nathan explores customer acquisition spend and models allowable CAC based on gross margins and a 12-month payback target.17:28–19:31 · Guest disagreement 2/10 First Customer Origins, Low Churn, and The Famous Five Nathan asks for churn figures and conducts the Famous Five, lightly pressing Mark when he hesitates to share his age.19:31–20:03 · Guest disagreement 0/10 Episode Summary and Key Metrics Recap Solo host wrap-up summarizing Cloud Elements' founding story, customer count, capital raised, and ARR trajectory.0:49–3:03 · Nathan pushing back 1/10 Defining Cloud Elements and the API Integration Frontier Nathan asks Mark to clarify Cloud Elements' value proposition compared to Zapier or Segment. Mark explains enterprise service buses and API orchestration in non-technical terms.3:03–6:55 · Nathan pushing back 2/10 Pricing Architecture, Founding Story, and Equity Distribution Mark outlines the pricing structure, early bootstrapped consulting period, and how the four co-founders divided equity using market benchmarks.6:55–11:32 · Nathan pushing back 5/10 OEM Distribution, Rapid Revenue Growth, and Market Horizons Nathan models ARR estimates from customer counts and ASP. Mark corrects the math due to historic ASP expansion, and Nathan pushes on whether they will exit or raise more venture funding.11:35–17:28 · Nathan pushing back 3/10 Sponsor Spotlight: Simplifying Document Signing with SignEasy Following a sponsor read, Nathan explores customer acquisition spend and models allowable CAC based on gross margins and a 12-month payback target.17:28–19:31 · Nathan pushing back 4/10 First Customer Origins, Low Churn, and The Famous Five Nathan asks for churn figures and conducts the Famous Five, lightly pressing Mark when he hesitates to share his age.19:31–20:03 · Nathan pushing back 0/10 Episode Summary and Key Metrics Recap Solo host wrap-up summarizing Cloud Elements' founding story, customer count, capital raised, and ARR trajectory.

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

0:00 · Nathan 43.5% · guest 56.5%0:00 · Nathan 43.5% · guest 56.5%3:00 · Nathan 20.3% · guest 79.7%3:00 · Nathan 20.3% · guest 79.7%6:00 · Nathan 30.2% · guest 69.8%6:00 · Nathan 30.2% · guest 69.8%9:00 · Nathan 41.6% · guest 58.4%9:00 · Nathan 41.6% · guest 58.4%12:00 · Nathan 29.7% · guest 70.3%12:00 · Nathan 29.7% · guest 70.3%15:00 · Nathan 37.4% · guest 62.6%15:00 · Nathan 37.4% · guest 62.6%18:00 · Nathan 55.1% · guest 44.9%18:00 · Nathan 55.1% · guest 44.9%
Sharpest disagreement ▶ 10:15 Resisting Forced Binary on Capital vs Exit

Mark resists Nathan's forced binary of either raising capital immediately or selling out to an acquirer, reasserting long-term market upside.

 Hardest push from Nathan ▶ 10:14 Challenging Evasive Stance on Funding Plans

Nathan interrupts Mark's vague response about growth with 'Come on Mark, which one is it?' to pin down exact fundraising timing.

 Biggest teaching moment ▶ 8:23 Correcting Static ASP Revenue Multiplier

Mark corrects Nathan's direct calculation of $14M ARR by pointing out that past cohorts entered at much lower price points before ASP tripled.

 Nathan holds their own ▶ 16:00 Deducing Maximum Allowable CAC Threshold

Nathan rapidly calculates gross margin-adjusted contract values and identifies Cloud Elements' upper bound for single-customer acquisition cost.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Defining Cloud Elements and the API Integration Frontier 4411 Nathan asks Mark to clarify Cloud Elements' value proposition compared to Zapier or Segment. Mark explains enterprise service buses and API orchestration in non-technical terms.
Pricing Architecture, Founding Story, and Equity Distribution 5312 Mark outlines the pricing structure, early bootstrapped consulting period, and how the four co-founders divided equity using market benchmarks.
OEM Distribution, Rapid Revenue Growth, and Market Horizons 7425 Nathan models ARR estimates from customer counts and ASP. Mark corrects the math due to historic ASP expansion, and Nathan pushes on whether they will exit or raise more venture funding.
Sponsor Spotlight: Simplifying Document Signing with SignEasy 6313 Following a sponsor read, Nathan explores customer acquisition spend and models allowable CAC based on gross margins and a 12-month payback target.
First Customer Origins, Low Churn, and The Famous Five 4224 Nathan asks for churn figures and conducts the Famous Five, lightly pressing Mark when he hesitates to share his age.
Episode Summary and Key Metrics Recap 0000 Solo host wrap-up summarizing Cloud Elements' founding story, customer count, capital raised, and ARR trajectory.

Statements from this episode (12)

Assertion Not checkable as stated
Cloud Elements Is 100% API-Based Unlike MuleSoft or Boomi
“Things like MuleSoft and Tibco and Boomi have traditionally been these enterprise service buses or iPadses. We're a hundred percent API based version of doing integration.”
Mark Geene Feb 28, 2018 ▶ 1:24
Assertion Not checkable as stated
Cloud Elements' Average Selling Price Is Approaching $70,000
“Our average ASP is about approaching about 70,000 a year.”
Mark Geene Feb 28, 2018 ▶ 3:30
Assertion Not checkable as stated
Cloud Elements' ASP Has More Than Tripled in Three Years
“The, what we've seen, our ASP has more than tripled over the past three years, and it's really a function of how many connectors we have in our library.”
Mark Geene Feb 28, 2018 ▶ 3:43
Assertion Supported
Cloud Elements Has Raised $22 Million to Date
“Twenty-two million.”
Mark Geene Feb 28, 2018 ▶ 4:56
Assertion Not checkable as stated
Cloud Elements Approaches 200 OEM Enterprise Software Customers
“We have we're approaching about 200 software companies that, and enterprises that essentially OEM our product.”
Mark Geene Feb 28, 2018 ▶ 7:00
Assertion Not checkable as stated
Cloud Elements' ARR Grew 30% Quarter-Over-Quarter Since 2015
“We've been growing at a, you know, I'll focus on more metrics that you know, we've been growing at a nearly a 30% quarter over quarter rate since we launched our product in 2015.”
Mark Geene Feb 28, 2018 ▶ 8:54
Assertion Supported
Software Integration Market Is Estimated at Over $30 Billion
“It's estimated that integration is over a thirty billion dollar you know, market that's just a bit, you know, and that's probably underestimated, I think, a lot of analysts feel.”
Mark Geene Feb 28, 2018 ▶ 10:52
Prediction Not checkable as stated
Published APIs Are Projected to Triple Within Six Months
“In fact, I just saw a study I forgot who it was from, but they were estimating that the number of APIs that are published are going to triple in the next six months.”
Mark Geene Feb 28, 2018 ▶ 12:42
Assertion Contradicted
Gartner: The Average Enterprise Uses Over 1,000 SaaS Applications
“And now with an average enterprise, according to Gartner, using over a thousand SAS applications, it's kind of mind boggling.”
Mark Geene Feb 28, 2018 ▶ 13:02
Disclosure
Cloud Elements Achieves 12-Month Gross Margin CAC Payback
“You know, we look to be in that, you know, 12 month-ish range for our payback, and we continue to operate at that level when we take, and that's at the gross margin basis level, right?”
Mark Geene Feb 28, 2018 ▶ 15:48
Disclosure
Cloud Elements Will Pay Up to $60,000 CAC for $70,000 ACV
“Yeah. We're willing to go that high. We don't, but yeah, that's you know, to spend 50 to 60 to get a 70,000 dollar customer is. Yeah. We'll do that. We'll do that all day long.”
Mark Geene Feb 28, 2018 ▶ 17:05
Assertion Not checkable as stated
Cloud Elements Keeps Annual Revenue Churn Under 10%
“Annually less than 10%.”
Mark Geene Feb 28, 2018 ▶ 18:07
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