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Oct 17, 2017 · 23m · top-founders

815: SaaS: He's Replacing the iClicker Growing From $800k ARR to $1.5m ARR in 6 months

Johnny Warstrom · 12m spoken Nathan Latka · 8m 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 Podcast, host Nathan Latka interviews Mentimeter CEO Johnny Warstrom on scaling an interactive presentation platform from $800k to $1.5M ARR with a lean 16-person team. Johnny discusses the mechanics of their product-led freemium model, viral acquisition loops, and long-term roadmap to reach $10M in ARR.

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 40.1% of the talking time here. How this is scored →

Nathan as informed peer 5.9 Guest teaching 2.4 Guest disagreement 1.4 Nathan pushing back 3.3
05100:0010:0020:001:43–3:49 · Nathan as informed peer 5/10 Introducing Johnny Warstrom and Mentimeter's Origin Story Latka introduces Warstrom and explores the origin story of Mentimeter, comparing it to legacy hardware clickers and interactive presentation tools in an amiable exchange.3:49–6:44 · Nathan as informed peer 7/10 Freemium Business Model and ARR Milestones Latka drills into customer metrics, teasing apart total users versus paid presenters and catching a numerical discrepancy between monthly revenue and annual run rate.6:46–9:29 · Nathan as informed peer 6/10 Bootstrapped Origins, Angel Funding, and Organic Virality The conversation covers Mentimeter's funding history and viral distribution, with Latka helping formalize how audience participation acts as an organic acquisition loop.9:29–12:58 · Nathan as informed peer 7/10 Team Allocation, Unit Economics, and Paid Acquisition Tests Latka pushes Warstrom to calculate fully loaded CAC on the spot and challenges the claim of relying purely on organic growth when paid spend represents 17% of top line.12:59–16:40 · Nathan as informed peer 7/10 Subscription Churn Dynamics and Customer Refund Policies Latka questions how monthly churn can be tracked on annual prepaid contracts, pressing Warstrom on non-renewal policies, refund structures, and ARR adjustments.16:40–20:17 · Nathan as informed peer 6/10 Unconventional Marketing: The Eurovision Song Contest Campaign Warstrom describes their viral Eurovision marketing stunt and ambitious growth targets, while Latka probes on valuation expectations and hypothetical exit offers.20:18–23:09 · Nathan as informed peer 3/10 Sponsor Message: TheTopInbox Email Productivity Tool Latka presents an advertisement for TheTopInbox before running through the standard Famous Five closing rapid-fire questions with Warstrom.1:43–3:49 · Guest teaching 2/10 Introducing Johnny Warstrom and Mentimeter's Origin Story Latka introduces Warstrom and explores the origin story of Mentimeter, comparing it to legacy hardware clickers and interactive presentation tools in an amiable exchange.3:49–6:44 · Guest teaching 3/10 Freemium Business Model and ARR Milestones Latka drills into customer metrics, teasing apart total users versus paid presenters and catching a numerical discrepancy between monthly revenue and annual run rate.6:46–9:29 · Guest teaching 2/10 Bootstrapped Origins, Angel Funding, and Organic Virality The conversation covers Mentimeter's funding history and viral distribution, with Latka helping formalize how audience participation acts as an organic acquisition loop.9:29–12:58 · Guest teaching 3/10 Team Allocation, Unit Economics, and Paid Acquisition Tests Latka pushes Warstrom to calculate fully loaded CAC on the spot and challenges the claim of relying purely on organic growth when paid spend represents 17% of top line.12:59–16:40 · Guest teaching 4/10 Subscription Churn Dynamics and Customer Refund Policies Latka questions how monthly churn can be tracked on annual prepaid contracts, pressing Warstrom on non-renewal policies, refund structures, and ARR adjustments.16:40–20:17 · Guest teaching 2/10 Unconventional Marketing: The Eurovision Song Contest Campaign Warstrom describes their viral Eurovision marketing stunt and ambitious growth targets, while Latka probes on valuation expectations and hypothetical exit offers.20:18–23:09 · Guest teaching 1/10 Sponsor Message: TheTopInbox Email Productivity Tool Latka presents an advertisement for TheTopInbox before running through the standard Famous Five closing rapid-fire questions with Warstrom.1:43–3:49 · Guest disagreement 1/10 Introducing Johnny Warstrom and Mentimeter's Origin Story Latka introduces Warstrom and explores the origin story of Mentimeter, comparing it to legacy hardware clickers and interactive presentation tools in an amiable exchange.3:49–6:44 · Guest disagreement 2/10 Freemium Business Model and ARR Milestones Latka drills into customer metrics, teasing apart total users versus paid presenters and catching a numerical discrepancy between monthly revenue and annual run rate.6:46–9:29 · Guest disagreement 1/10 Bootstrapped Origins, Angel Funding, and Organic Virality The conversation covers Mentimeter's funding history and viral distribution, with Latka helping formalize how audience participation acts as an organic acquisition loop.9:29–12:58 · Guest disagreement 2/10 Team Allocation, Unit Economics, and Paid Acquisition Tests Latka pushes Warstrom to calculate fully loaded CAC on the spot and challenges the claim of relying purely on organic growth when paid spend represents 17% of top line.12:59–16:40 · Guest disagreement 2/10 Subscription Churn Dynamics and Customer Refund Policies Latka questions how monthly churn can be tracked on annual prepaid contracts, pressing Warstrom on non-renewal policies, refund structures, and ARR adjustments.16:40–20:17 · Guest disagreement 2/10 Unconventional Marketing: The Eurovision Song Contest Campaign Warstrom describes their viral Eurovision marketing stunt and ambitious growth targets, while Latka probes on valuation expectations and hypothetical exit offers.20:18–23:09 · Guest disagreement 0/10 Sponsor Message: TheTopInbox Email Productivity Tool Latka presents an advertisement for TheTopInbox before running through the standard Famous Five closing rapid-fire questions with Warstrom.1:43–3:49 · Nathan pushing back 1/10 Introducing Johnny Warstrom and Mentimeter's Origin Story Latka introduces Warstrom and explores the origin story of Mentimeter, comparing it to legacy hardware clickers and interactive presentation tools in an amiable exchange.3:49–6:44 · Nathan pushing back 5/10 Freemium Business Model and ARR Milestones Latka drills into customer metrics, teasing apart total users versus paid presenters and catching a numerical discrepancy between monthly revenue and annual run rate.6:46–9:29 · Nathan pushing back 1/10 Bootstrapped Origins, Angel Funding, and Organic Virality The conversation covers Mentimeter's funding history and viral distribution, with Latka helping formalize how audience participation acts as an organic acquisition loop.9:29–12:58 · Nathan pushing back 6/10 Team Allocation, Unit Economics, and Paid Acquisition Tests Latka pushes Warstrom to calculate fully loaded CAC on the spot and challenges the claim of relying purely on organic growth when paid spend represents 17% of top line.12:59–16:40 · Nathan pushing back 7/10 Subscription Churn Dynamics and Customer Refund Policies Latka questions how monthly churn can be tracked on annual prepaid contracts, pressing Warstrom on non-renewal policies, refund structures, and ARR adjustments.16:40–20:17 · Nathan pushing back 3/10 Unconventional Marketing: The Eurovision Song Contest Campaign Warstrom describes their viral Eurovision marketing stunt and ambitious growth targets, while Latka probes on valuation expectations and hypothetical exit offers.20:18–23:09 · Nathan pushing back 0/10 Sponsor Message: TheTopInbox Email Productivity Tool Latka presents an advertisement for TheTopInbox before running through the standard Famous Five closing rapid-fire questions with Warstrom.

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

0:00 · Nathan 76.5% · guest 23.5%0:00 · Nathan 76.5% · guest 23.5%3:00 · Nathan 25% · guest 75%3:00 · Nathan 25% · guest 75%6:00 · Nathan 38.9% · guest 61.1%6:00 · Nathan 38.9% · guest 61.1%9:00 · Nathan 29.8% · guest 70.2%9:00 · Nathan 29.8% · guest 70.2%12:00 · Nathan 24% · guest 76%12:00 · Nathan 24% · guest 76%15:00 · Nathan 20.9% · guest 79.1%15:00 · Nathan 20.9% · guest 79.1%18:00 · Nathan 48.1% · guest 51.9%18:00 · Nathan 48.1% · guest 51.9%21:00 · Nathan 58.6% · guest 41.4%21:00 · Nathan 58.6% · guest 41.4%
Sharpest disagreement ▶ 19:25 Immediate rejection of acquisition valuation

Warstrom flatly dismisses Latka's hypothetical $4.5 million acquisition offer from Adobe, asserting the company's upside is far higher.

 Hardest push from Nathan ▶ 14:46 Pressing on monthly churn for annual plans

Latka refuses to accept a monthly churn metric at face value when Mentimeter only sells annual upfront contracts, demanding an operational explanation.

 Biggest teaching moment ▶ 15:17 Explaining prepaid SaaS churn accounting

Warstrom clarifies how committed ARR is adjusted immediately upon non-renewal notice even when no pro-rated refund is issued.

 Nathan holds their own ▶ 12:45 Calculating paid spend as top-line percentage

Latka demonstrates sharp business acumen by instantly calculating that a $10k-$20k test spend represents 17% of Mentimeter's monthly revenue, challenging the guest's casual dismissal of paid acquisition.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Introducing Johnny Warstrom and Mentimeter's Origin Story 5211 Latka introduces Warstrom and explores the origin story of Mentimeter, comparing it to legacy hardware clickers and interactive presentation tools in an amiable exchange.
Freemium Business Model and ARR Milestones 7325 Latka drills into customer metrics, teasing apart total users versus paid presenters and catching a numerical discrepancy between monthly revenue and annual run rate.
Bootstrapped Origins, Angel Funding, and Organic Virality 6211 The conversation covers Mentimeter's funding history and viral distribution, with Latka helping formalize how audience participation acts as an organic acquisition loop.
Team Allocation, Unit Economics, and Paid Acquisition Tests 7326 Latka pushes Warstrom to calculate fully loaded CAC on the spot and challenges the claim of relying purely on organic growth when paid spend represents 17% of top line.
Subscription Churn Dynamics and Customer Refund Policies 7427 Latka questions how monthly churn can be tracked on annual prepaid contracts, pressing Warstrom on non-renewal policies, refund structures, and ARR adjustments.
Unconventional Marketing: The Eurovision Song Contest Campaign 6223 Warstrom describes their viral Eurovision marketing stunt and ambitious growth targets, while Latka probes on valuation expectations and hypothetical exit offers.
Sponsor Message: TheTopInbox Email Productivity Tool 3100 Latka presents an advertisement for TheTopInbox before running through the standard Famous Five closing rapid-fire questions with Warstrom.

Statements from this episode (13)

Assertion Not checkable as stated
Mentimeter reaches 10M users and 400,000 presenters globally
“So today we have over ten million users 400,000 presenters around the world, and customers in 55 countries.”
Johnny Warstrom Oct 17, 2017 ▶ 4:03
Assertion Not checkable as stated
Mentimeter reports having 6,000 paying business customers
“Today we have 6000 enterprise customers.”
Johnny Warstrom Oct 17, 2017 ▶ 4:49
Assertion Supported
Mentimeter reaches $1.5M in ARR
“And we have one and a half million.”
Johnny Warstrom Oct 17, 2017 ▶ 6:31
Assertion Supported
Mentimeter reached profitability on just $500,000 in total funding
“In total, we've only raised a half a million in total, and today we're profitable, we're cashflow positive.”
Johnny Warstrom Oct 17, 2017 ▶ 7:44
Assertion Not checkable as stated
Mentimeter's 16-person team is mostly product and marketing, with one sales rep
“I would say like nine in product, I would say six in marketing, and then one in sales.”
Johnny Warstrom Oct 17, 2017 ▶ 10:06
Assertion Not checkable as stated
Mentimeter's fully weighted customer acquisition cost is roughly $100
“Yeah, exactly, so it's about a hundred dollars.”
Johnny Warstrom Oct 17, 2017 ▶ 11:28
Disclosure
Mentimeter spends $10,000 to $20,000 per month testing paid ads
“No, but it's like, 10 K. We experiment with 10, 20 Ks just to test different things, retargeting different platforms, different formats”
Johnny Warstrom Oct 17, 2017 ▶ 12:18
Assertion Not checkable as stated
Mentimeter maintains a net revenue churn of negative 5%
“Well, it's like five, at least five percent. And it's because we're just bringing on more with two starting in customer success in, in August and September. And it's because it's only been one person. We haven't optimized it, but it's about minus five.”
Johnny Warstrom Oct 17, 2017 ▶ 13:54
Assertion Not checkable as stated
Mentimeter's monthly logo churn rate is between 1% and 1.5%
“Well, monthly is about one to one and a half percent.”
Johnny Warstrom Oct 17, 2017 ▶ 14:49
Assertion Not checkable as stated
Mentimeter closed 2016 at roughly $800,000 in ARR
“8, I think.8.”
Johnny Warstrom Oct 17, 2017 ▶ 18:17
Prediction Not checkable as stated
Mentimeter will organically reach $10M ARR by summer 2019
“We have a plan to go reach like ten million ARR by the summer of 19. And we probably can do that organically by the funds that we're generating in our surplus and by the amazing people that we have on board.”
Johnny Warstrom Oct 17, 2017 ▶ 18:51
Disclosure
Warstrom would easily reject a $4.5 million acquisition offer
“I'm not even close.”
Johnny Warstrom Oct 17, 2017 ▶ 19:31
Opinion
Mentimeter CEO calls Intercom the best product created in past five years
“Intercom is the best product that has been created the last five years, and their new, like, educate version, like content management, it's amazing, so everyone should look into it.”
Johnny Warstrom Oct 17, 2017 ▶ 22:16
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