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Jun 18, 2017 · 18m · top-founders

694: Why 1 Year Payback Period is Important From $50M Funded CEO

Nathan Latka · 9m spoken Don Mal · 7m 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 episode 694 of The Top, Nathan Latka interviews Don Mal, CEO and co-founder of cloud Corporate Performance Management provider Vena Solutions, exploring the metrics behind their $1.4 million MRR, $50 million in funding, and strict 1-year CAC payback model.

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 55% of the talking time here. How this is scored →

Nathan as informed peer 5.8 Guest teaching 1.3 Guest disagreement 1.0 Nathan pushing back 3.3
05100:0010:001:05–4:46 · Nathan as informed peer 6/10 Defining CPM Software and Vena's Core Value Proposition Nathan opens by immediately challenging Don's marketing claim of being the fastest-growing CPM software, asking for real numbers. He shows strong domain familiarity by contrasting horizontal CPM software with vertical point solutions like Handshake and distinguishing Expensify/Bill.com from enterprise performance management.4:47–9:08 · Nathan as informed peer 7/10 Vena's Founding, Equity Rounds, and Venture Debt Strategy Nathan presses Don on how they justified an aggressive $10M seed valuation and catches a discrepancy in public funding totals, uncovering their venture debt tranche. He displays strong venture finance acumen by drilling into note structures, debt covenants, and specific lending partners like Silicon Valley Bank.9:09–14:08 · Nathan as informed peer 8/10 Customer Growth, Unit Economics, Payback Period, and LTV Nathan demonstrates deep mastery of SaaS unit economics, accurately calculating monthly recurring revenue and parsing CAC payback ratios, gross churn, and net revenue expansion rates. He cautiously scrutinizes Don's $500k LTV projection as potentially optimistic spreadsheet modeling.14:08–17:08 · Nathan as informed peer 2/10 Sponsor Break: Organifi Superfood Nutrition for Travel The segment includes a mid-roll sponsor read followed by standard rapid-fire Famous Five questions. Nathan playfully nudges Don when he immediately rejects a hypothetical $150M buyout offer.1:05–4:46 · Guest teaching 2/10 Defining CPM Software and Vena's Core Value Proposition Nathan opens by immediately challenging Don's marketing claim of being the fastest-growing CPM software, asking for real numbers. He shows strong domain familiarity by contrasting horizontal CPM software with vertical point solutions like Handshake and distinguishing Expensify/Bill.com from enterprise performance management.4:47–9:08 · Guest teaching 2/10 Vena's Founding, Equity Rounds, and Venture Debt Strategy Nathan presses Don on how they justified an aggressive $10M seed valuation and catches a discrepancy in public funding totals, uncovering their venture debt tranche. He displays strong venture finance acumen by drilling into note structures, debt covenants, and specific lending partners like Silicon Valley Bank.9:09–14:08 · Guest teaching 1/10 Customer Growth, Unit Economics, Payback Period, and LTV Nathan demonstrates deep mastery of SaaS unit economics, accurately calculating monthly recurring revenue and parsing CAC payback ratios, gross churn, and net revenue expansion rates. He cautiously scrutinizes Don's $500k LTV projection as potentially optimistic spreadsheet modeling.14:08–17:08 · Guest teaching 0/10 Sponsor Break: Organifi Superfood Nutrition for Travel The segment includes a mid-roll sponsor read followed by standard rapid-fire Famous Five questions. Nathan playfully nudges Don when he immediately rejects a hypothetical $150M buyout offer.1:05–4:46 · Guest disagreement 1/10 Defining CPM Software and Vena's Core Value Proposition Nathan opens by immediately challenging Don's marketing claim of being the fastest-growing CPM software, asking for real numbers. He shows strong domain familiarity by contrasting horizontal CPM software with vertical point solutions like Handshake and distinguishing Expensify/Bill.com from enterprise performance management.4:47–9:08 · Guest disagreement 1/10 Vena's Founding, Equity Rounds, and Venture Debt Strategy Nathan presses Don on how they justified an aggressive $10M seed valuation and catches a discrepancy in public funding totals, uncovering their venture debt tranche. He displays strong venture finance acumen by drilling into note structures, debt covenants, and specific lending partners like Silicon Valley Bank.9:09–14:08 · Guest disagreement 1/10 Customer Growth, Unit Economics, Payback Period, and LTV Nathan demonstrates deep mastery of SaaS unit economics, accurately calculating monthly recurring revenue and parsing CAC payback ratios, gross churn, and net revenue expansion rates. He cautiously scrutinizes Don's $500k LTV projection as potentially optimistic spreadsheet modeling.14:08–17:08 · Guest disagreement 1/10 Sponsor Break: Organifi Superfood Nutrition for Travel The segment includes a mid-roll sponsor read followed by standard rapid-fire Famous Five questions. Nathan playfully nudges Don when he immediately rejects a hypothetical $150M buyout offer.1:05–4:46 · Nathan pushing back 4/10 Defining CPM Software and Vena's Core Value Proposition Nathan opens by immediately challenging Don's marketing claim of being the fastest-growing CPM software, asking for real numbers. He shows strong domain familiarity by contrasting horizontal CPM software with vertical point solutions like Handshake and distinguishing Expensify/Bill.com from enterprise performance management.4:47–9:08 · Nathan pushing back 4/10 Vena's Founding, Equity Rounds, and Venture Debt Strategy Nathan presses Don on how they justified an aggressive $10M seed valuation and catches a discrepancy in public funding totals, uncovering their venture debt tranche. He displays strong venture finance acumen by drilling into note structures, debt covenants, and specific lending partners like Silicon Valley Bank.9:09–14:08 · Nathan pushing back 3/10 Customer Growth, Unit Economics, Payback Period, and LTV Nathan demonstrates deep mastery of SaaS unit economics, accurately calculating monthly recurring revenue and parsing CAC payback ratios, gross churn, and net revenue expansion rates. He cautiously scrutinizes Don's $500k LTV projection as potentially optimistic spreadsheet modeling.14:08–17:08 · Nathan pushing back 2/10 Sponsor Break: Organifi Superfood Nutrition for Travel The segment includes a mid-roll sponsor read followed by standard rapid-fire Famous Five questions. Nathan playfully nudges Don when he immediately rejects a hypothetical $150M buyout offer.

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

0:00 · Nathan 55.3% · guest 44.7%0:00 · Nathan 55.3% · guest 44.7%3:00 · Nathan 41% · guest 59%3:00 · Nathan 41% · guest 59%6:00 · Nathan 43.4% · guest 56.6%6:00 · Nathan 43.4% · guest 56.6%9:00 · Nathan 45.2% · guest 54.8%9:00 · Nathan 45.2% · guest 54.8%12:00 · Nathan 60% · guest 40%12:00 · Nathan 60% · guest 40%15:00 · Nathan 79.6% · guest 20.4%15:00 · Nathan 79.6% · guest 20.4%18:00 · Nathan 100% · guest 0%18:00 · Nathan 100% · guest 0%
Sharpest disagreement ▶ 15:43 Don rejects buyout valuation

When Nathan asks if Don would sell the company today for $150 million to Microsoft's CEO, Don instantly and flatly shuts down the idea with an unequivocal 'No'.

 Hardest push from Nathan ▶ 7:42 Nathan challenges reported capital raised vs public records

Nathan refuses to accept the $50 million figure at face value, citing his background research showing only $30 million in equity rounds, which forces Don to clarify the debt breakdown.

 Biggest teaching moment ▶ 12:38 Don explains multi-use case platform expansion driving LTV

Don explains how enterprise CPM expands from one or two initial use cases to over twenty within a single organization, illustrating why their high lifetime value projections are realistic despite customer churn.

 Nathan holds their own ▶ 11:27 Nathan unpacks and verifies 12-month CAC payback formula

Nathan synthesizes Don's 1.0 CAC ratio into practical metrics, demonstrating his own SaaS expertise by explicitly breaking down customer acquisition cost equivalence to first-year contract value.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Defining CPM Software and Vena's Core Value Proposition 6214 Nathan opens by immediately challenging Don's marketing claim of being the fastest-growing CPM software, asking for real numbers. He shows strong domain familiarity by contrasting horizontal CPM software with vertical point solutions like Handshake and distinguishing Expensify/Bill.com from enterprise performance management.
Vena's Founding, Equity Rounds, and Venture Debt Strategy 7214 Nathan presses Don on how they justified an aggressive $10M seed valuation and catches a discrepancy in public funding totals, uncovering their venture debt tranche. He displays strong venture finance acumen by drilling into note structures, debt covenants, and specific lending partners like Silicon Valley Bank.
Customer Growth, Unit Economics, Payback Period, and LTV 8113 Nathan demonstrates deep mastery of SaaS unit economics, accurately calculating monthly recurring revenue and parsing CAC payback ratios, gross churn, and net revenue expansion rates. He cautiously scrutinizes Don's $500k LTV projection as potentially optimistic spreadsheet modeling.
Sponsor Break: Organifi Superfood Nutrition for Travel 2012 The segment includes a mid-roll sponsor read followed by standard rapid-fire Famous Five questions. Nathan playfully nudges Don when he immediately rejects a hypothetical $150M buyout offer.

Statements from this episode (11)

Assertion Not checkable as stated
Vena Solutions is growing over 100% year-over-year
“What we know is that we're growing at greater than a hundred percent year over year.”
Don Mal Jun 18, 2017 ▶ 1:26
Assertion Not checkable as stated
Vena Solutions generates around $50,000 per customer annually
“Yeah, so we're getting around 50,000 dollars per year per customer, so, you know, break that down 4000 a month, I guess, roughly.”
Don Mal Jun 18, 2017 ▶ 4:31
Disclosure
Vena Solutions launched with a $10 million seed valuation
“So right out of the gate, we value the company at ten million dollars.”
Don Mal Jun 18, 2017 ▶ 5:37
Assertion Not checkable as stated
Vena Solutions raised over $1 million from friends and family
“That early round, we raised over a million dollars with friends and family to launch the business.”
Don Mal Jun 18, 2017 ▶ 6:19
Assertion Not publicly verifiable
Vena Solutions has raised roughly $49 million in equity and debt
“So if you look at the total combined investments to date, it's right around forty nine million.”
Don Mal Jun 18, 2017 ▶ 8:08
Assertion Not checkable as stated
Vena Solutions approaches 350 customers, adding 50 per quarter
“So we are approaching 350 customers. But just to get a sense of run rate, we will add 50 customers this quarter.”
Don Mal Jun 18, 2017 ▶ 9:17
Disclosure
Vena Solutions targets a CAC payback period under 12 months
“We'd like to keep our kind of, you know, cost to acquire customers below a kind of a 12 month cost of what we would normally see for revenue. So, you know, that ratio of one would be kind of ideal or, you know, and we know that anything kind of better than a .…”
Don Mal Jun 18, 2017 ▶ 11:05
Assertion Not checkable as stated
Vena Solutions projects a customer LTV of $400,000 to $500,000
“And so we do, you know, sort of Project a customer staying with us for as up to 10 years. Imagine, you know, four to 500,000 dollars with a lifetime value.”
Don Mal Jun 18, 2017 ▶ 11:58
Assertion Not checkable as stated
Vena Solutions maintains under 10% gross customer churn
“It's, I would say our overall churn is less than 10%, which is within our industry standpoint.”
Don Mal Jun 18, 2017 ▶ 13:28
Assertion Not checkable as stated
Vena Solutions sees 120% year-over-year revenue expansion
“Yeah, it's probably closer to a 120%.”
Don Mal Jun 18, 2017 ▶ 14:03
Disclosure
Mal would reject a $150 million acquisition offer for Vena Solutions
“No.”
Don Mal Jun 18, 2017 ▶ 15:44
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