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Jan 11, 2018 · 17m · top-founders

901 SaaS: Bootstrapped Enterprise Marketing Maropost Passes $36m ARR

Ross Paquette · 9m spoken Nathan Latka · 6m spoken
0:00 / 0:00

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In this episode of The Top Entrepreneurs, host Nathan Latka interviews Maropost founder and CEO Ross Paquette, who shares how he bootstrapped an enterprise marketing automation platform to over $36 million in ARR and executed a $37 million secondary transaction at a $160 million valuation.

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 43.2% of the talking time here. How this is scored →

Nathan as informed peer 6.3 Guest teaching 2.8 Guest disagreement 1.3 Nathan pushing back 2.8
05100:0010:000:48–5:13 · Nathan as informed peer 6/10 Introducing Ross Paquette and Maropost's SaaS Model Latka drills into ARPU, contract lengths, and founding equity dynamics, actively testing the numbers. Paquette provides clear background on bootstrapping while working at Oracle ERP.5:13–7:27 · Nathan as informed peer 6/10 Understanding the $37M Secondary Offering and Valuation Latka asks for an explanation of secondary offerings and calculates equity dilution. Paquette clarifies that the secondary capital was for existing shareholders rather than balance-sheet growth capital.7:27–10:13 · Nathan as informed peer 7/10 Maropost Sales Cloud, Non-Profit Offerings, and Scaling Latka contextualizes valuation math against the $37M secondary round, and challenges Paquette on why he did not cash out completely. Paquette explains his multi-product expansion strategy.10:13–13:13 · Nathan as informed peer 8/10 Enterprise Retention Metrics and Churn Management Latka pushes on the distinction between logo churn and revenue churn and cites Vista's Marketo acquisition. Paquette explains the low churn of enterprise contracts compared to low-ACV self-serve SaaS.13:13–16:26 · Nathan as informed peer 8/10 Team Structure, Net Expansion, and Customer Acquisition Costs Latka calculates expansion projections and challenges Paquette on how to manage CAC when lifetime value appears infinite on paper. Paquette reframes by stating Maropost prioritizes absolute profitability over standard SaaS metric tracking.16:26–16:58 · Nathan as informed peer 3/10 The Famous Five Rapid-Fire Questions Rapid-fire Famous Five wrap-up with brief answers and quick questions.0:48–5:13 · Guest teaching 3/10 Introducing Ross Paquette and Maropost's SaaS Model Latka drills into ARPU, contract lengths, and founding equity dynamics, actively testing the numbers. Paquette provides clear background on bootstrapping while working at Oracle ERP.5:13–7:27 · Guest teaching 4/10 Understanding the $37M Secondary Offering and Valuation Latka asks for an explanation of secondary offerings and calculates equity dilution. Paquette clarifies that the secondary capital was for existing shareholders rather than balance-sheet growth capital.7:27–10:13 · Guest teaching 2/10 Maropost Sales Cloud, Non-Profit Offerings, and Scaling Latka contextualizes valuation math against the $37M secondary round, and challenges Paquette on why he did not cash out completely. Paquette explains his multi-product expansion strategy.10:13–13:13 · Guest teaching 4/10 Enterprise Retention Metrics and Churn Management Latka pushes on the distinction between logo churn and revenue churn and cites Vista's Marketo acquisition. Paquette explains the low churn of enterprise contracts compared to low-ACV self-serve SaaS.13:13–16:26 · Guest teaching 3/10 Team Structure, Net Expansion, and Customer Acquisition Costs Latka calculates expansion projections and challenges Paquette on how to manage CAC when lifetime value appears infinite on paper. Paquette reframes by stating Maropost prioritizes absolute profitability over standard SaaS metric tracking.16:26–16:58 · Guest teaching 1/10 The Famous Five Rapid-Fire Questions Rapid-fire Famous Five wrap-up with brief answers and quick questions.0:48–5:13 · Guest disagreement 1/10 Introducing Ross Paquette and Maropost's SaaS Model Latka drills into ARPU, contract lengths, and founding equity dynamics, actively testing the numbers. Paquette provides clear background on bootstrapping while working at Oracle ERP.5:13–7:27 · Guest disagreement 1/10 Understanding the $37M Secondary Offering and Valuation Latka asks for an explanation of secondary offerings and calculates equity dilution. Paquette clarifies that the secondary capital was for existing shareholders rather than balance-sheet growth capital.7:27–10:13 · Guest disagreement 1/10 Maropost Sales Cloud, Non-Profit Offerings, and Scaling Latka contextualizes valuation math against the $37M secondary round, and challenges Paquette on why he did not cash out completely. Paquette explains his multi-product expansion strategy.10:13–13:13 · Guest disagreement 2/10 Enterprise Retention Metrics and Churn Management Latka pushes on the distinction between logo churn and revenue churn and cites Vista's Marketo acquisition. Paquette explains the low churn of enterprise contracts compared to low-ACV self-serve SaaS.13:13–16:26 · Guest disagreement 2/10 Team Structure, Net Expansion, and Customer Acquisition Costs Latka calculates expansion projections and challenges Paquette on how to manage CAC when lifetime value appears infinite on paper. Paquette reframes by stating Maropost prioritizes absolute profitability over standard SaaS metric tracking.16:26–16:58 · Guest disagreement 1/10 The Famous Five Rapid-Fire Questions Rapid-fire Famous Five wrap-up with brief answers and quick questions.0:48–5:13 · Nathan pushing back 2/10 Introducing Ross Paquette and Maropost's SaaS Model Latka drills into ARPU, contract lengths, and founding equity dynamics, actively testing the numbers. Paquette provides clear background on bootstrapping while working at Oracle ERP.5:13–7:27 · Nathan pushing back 3/10 Understanding the $37M Secondary Offering and Valuation Latka asks for an explanation of secondary offerings and calculates equity dilution. Paquette clarifies that the secondary capital was for existing shareholders rather than balance-sheet growth capital.7:27–10:13 · Nathan pushing back 3/10 Maropost Sales Cloud, Non-Profit Offerings, and Scaling Latka contextualizes valuation math against the $37M secondary round, and challenges Paquette on why he did not cash out completely. Paquette explains his multi-product expansion strategy.10:13–13:13 · Nathan pushing back 4/10 Enterprise Retention Metrics and Churn Management Latka pushes on the distinction between logo churn and revenue churn and cites Vista's Marketo acquisition. Paquette explains the low churn of enterprise contracts compared to low-ACV self-serve SaaS.13:13–16:26 · Nathan pushing back 4/10 Team Structure, Net Expansion, and Customer Acquisition Costs Latka calculates expansion projections and challenges Paquette on how to manage CAC when lifetime value appears infinite on paper. Paquette reframes by stating Maropost prioritizes absolute profitability over standard SaaS metric tracking.16:26–16:58 · Nathan pushing back 1/10 The Famous Five Rapid-Fire Questions Rapid-fire Famous Five wrap-up with brief answers and quick questions.

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

0:00 · Nathan 64.6% · guest 35.4%0:00 · Nathan 64.6% · guest 35.4%3:00 · Nathan 28.7% · guest 71.3%3:00 · Nathan 28.7% · guest 71.3%6:00 · Nathan 26.3% · guest 73.7%6:00 · Nathan 26.3% · guest 73.7%9:00 · Nathan 50.8% · guest 49.2%9:00 · Nathan 50.8% · guest 49.2%12:00 · Nathan 32.4% · guest 67.6%12:00 · Nathan 32.4% · guest 67.6%15:00 · Nathan 58.4% · guest 41.6%15:00 · Nathan 58.4% · guest 41.6%
Sharpest disagreement ▶ 15:34 Dismissing SaaS LTV and CAC metrics

Paquette rejects Latka's premise around tracking unit economics, stating standard CAC and LTV metrics are irrelevant to their business model.

 Hardest push from Nathan ▶ 9:20 Latka presses on not selling the entire company

Latka challenges Paquette directly on why he did not execute a total exit given the large valuation and market liquidity.

 Biggest teaching moment ▶ 6:04 Educating on secondary round mechanics

Paquette breaks down how a secondary liquidity round functions for shareholders without diluting company operational cash.

 Nathan holds their own ▶ 10:13 Latka calculates ARR and benchmarks private equity environment

Latka calculates Maropost's run-rate metrics in real time and contextualizes market timing against Vista's buyout moves.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Introducing Ross Paquette and Maropost's SaaS Model 6312 Latka drills into ARPU, contract lengths, and founding equity dynamics, actively testing the numbers. Paquette provides clear background on bootstrapping while working at Oracle ERP.
Understanding the $37M Secondary Offering and Valuation 6413 Latka asks for an explanation of secondary offerings and calculates equity dilution. Paquette clarifies that the secondary capital was for existing shareholders rather than balance-sheet growth capital.
Maropost Sales Cloud, Non-Profit Offerings, and Scaling 7213 Latka contextualizes valuation math against the $37M secondary round, and challenges Paquette on why he did not cash out completely. Paquette explains his multi-product expansion strategy.
Enterprise Retention Metrics and Churn Management 8424 Latka pushes on the distinction between logo churn and revenue churn and cites Vista's Marketo acquisition. Paquette explains the low churn of enterprise contracts compared to low-ACV self-serve SaaS.
Team Structure, Net Expansion, and Customer Acquisition Costs 8324 Latka calculates expansion projections and challenges Paquette on how to manage CAC when lifetime value appears infinite on paper. Paquette reframes by stating Maropost prioritizes absolute profitability over standard SaaS metric tracking.
The Famous Five Rapid-Fire Questions 3111 Rapid-fire Famous Five wrap-up with brief answers and quick questions.

Statements from this episode (12)

Assertion Not publicly verifiable
Maropost Reached $160M Valuation With PE and Family Offices
“That was our last valuation that we did. I brought in a couple of partners last summer two private equity firms and two family offices. So that was really what they came up with.”
Ross Paquette Jan 11, 2018 ▶ 1:18
Assertion Not checkable as stated
Maropost's Average Customer Pays Roughly $90,000 Annually
“It's about 90,000. So, you know, 8000 or just under 8000 or so us dollars.”
Ross Paquette Jan 11, 2018 ▶ 2:10
Assertion Not checkable as stated
Paquette Funded Maropost's Early Development While Selling Software at Oracle
“I was still working for Oracle ERP. So I was selling construction software, neither of which I know anything about. But while I was working there, I was funding the development of Merrill post.”
Ross Paquette Jan 11, 2018 ▶ 3:55
Opinion
Ross Paquette Is Strongly Against Raising Venture Capital
“It wasn't like we had to go out and raise capital. I'm very much against that process. The focus has always been to just, you know, kind of grow by a customer acquisition, not acquisition.”
Ross Paquette Jan 11, 2018 ▶ 4:06
Disclosure
Maropost Has Never Raised Primary Capital, Only Secondary
“We've never raised any money to date. Yeah. so last summer was merely or purely a secondary round that's public.”
Ross Paquette Jan 11, 2018 ▶ 5:14
Disclosure
Maropost Took at Most $100,000 in Personal Seed Funding
“I can't even put a dollar figure on it. It was maybe a 100,000 you know, worst case scenario because we were able to bring in a couple of customers early on with, you know, with kind of a basic product and those customers inherently sort of help fund the growt…”
Ross Paquette Jan 11, 2018 ▶ 5:23
Assertion Not checkable as stated
Maropost Has 380 Customers
“We have 380 customers.”
Ross Paquette Jan 11, 2018 ▶ 9:02
Opinion
Secondary Buyers Seek Growth Exposure, Not Full Company Buyouts
“Most of those individuals do not want to purchase an entire company of our size. They're really just looking for that, that growth potential, excuse me. So that option isn't even on the table, I guess you could say, in most of those situations.”
Ross Paquette Jan 11, 2018 ▶ 9:31
Assertion Not checkable as stated
Maropost's Annual Logo Churn Is Closer to 3%
“Sorry. Sorry. No, it's closer to three percent actually, if I'm giving you the exact number.”
Ross Paquette Jan 11, 2018 ▶ 12:45
Disclosure
Maropost Has Approximately 158 Employees
“We're about a hundred and 58 people.”
Ross Paquette Jan 11, 2018 ▶ 13:14
Assertion Not checkable as stated
Maropost Accounts Expand by 152% Over Two Years
“So I would say it's not year over year, but it's about a 152% growth over a two year span.”
Ross Paquette Jan 11, 2018 ▶ 14:00
Disclosure
Maropost Relies Entirely on Direct Sales Rather Than Marketing
“Everything we do is, is direct sales. So we're not you know, acquiring customers, say for the most part through partnerships or even any kind of active marketing programs.”
Ross Paquette Jan 11, 2018 ▶ 14:36
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