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Feb 4, 2017 · 21m · top-founders

EP 560: Badger Maps Does $1.2M in 2016, $120k MRR, Looking to 3x with CEO Steven Benson

Steve Benson · 10m 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,' host Nathan Latka interviews Steven Benson, founder and CEO of Badger Maps, exploring how the field sales software scaled to $1.2 million in 2016 revenue and $140,000 in monthly recurring revenue through bootstrapping and non-dilutive financing.

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 44.4% of the talking time here. How this is scored →

Nathan as informed peer 4.2 Guest teaching 2.6 Guest disagreement 1.6 Nathan pushing back 3.0
05100:0010:0020:002:55–6:36 · Nathan as informed peer 4/10 Founding Journey, Co-Founder Dynamics, and Equity Structuring Nathan inquires about founder equity distribution and assumes standard 4-year vesting and acceleration clauses. Steven shares a contrarian founder vesting structure where the bulk vests upon change of control to ensure long-term commitment.6:36–9:16 · Nathan as informed peer 4/10 Historical Revenue, App Store Ranking, and Customer Base Nathan tests Steven's marketing claim of being the number one sales app in the App Store, prompting Steven to explain Apple's previous category ranking. Nathan also probes whether 4,000 customers represents individual rep seats or corporate accounts.9:16–14:53 · Nathan as informed peer 6/10 Churn Metrics, Acquisition Channels, and Lighter Capital Debt Nathan pushes back on CAC spending benchmarks and teases Steven about San Francisco venture mindsets. Nathan also catches Steven on a debt round from Lighter Capital after Steven claimed to be purely bootstrapped.14:53–16:55 · Nathan as informed peer 5/10 2016 Total Revenue Performance and 2017 Annual Targets Nathan calculates the required monthly revenue run rate needed for Badger Maps to hit its ambitious $5M ARR target from its current $140k MRR baseline.16:56–20:30 · Nathan as informed peer 2/10 The Famous Five Rapid-Fire Questions and Career Reflections A collaborative Famous Five lightning round covering tool preferences, sleep habits, and career advice regarding early-stage companies versus large corporations.2:55–6:36 · Guest teaching 4/10 Founding Journey, Co-Founder Dynamics, and Equity Structuring Nathan inquires about founder equity distribution and assumes standard 4-year vesting and acceleration clauses. Steven shares a contrarian founder vesting structure where the bulk vests upon change of control to ensure long-term commitment.6:36–9:16 · Guest teaching 3/10 Historical Revenue, App Store Ranking, and Customer Base Nathan tests Steven's marketing claim of being the number one sales app in the App Store, prompting Steven to explain Apple's previous category ranking. Nathan also probes whether 4,000 customers represents individual rep seats or corporate accounts.9:16–14:53 · Guest teaching 4/10 Churn Metrics, Acquisition Channels, and Lighter Capital Debt Nathan pushes back on CAC spending benchmarks and teases Steven about San Francisco venture mindsets. Nathan also catches Steven on a debt round from Lighter Capital after Steven claimed to be purely bootstrapped.14:53–16:55 · Guest teaching 1/10 2016 Total Revenue Performance and 2017 Annual Targets Nathan calculates the required monthly revenue run rate needed for Badger Maps to hit its ambitious $5M ARR target from its current $140k MRR baseline.16:56–20:30 · Guest teaching 1/10 The Famous Five Rapid-Fire Questions and Career Reflections A collaborative Famous Five lightning round covering tool preferences, sleep habits, and career advice regarding early-stage companies versus large corporations.2:55–6:36 · Guest disagreement 2/10 Founding Journey, Co-Founder Dynamics, and Equity Structuring Nathan inquires about founder equity distribution and assumes standard 4-year vesting and acceleration clauses. Steven shares a contrarian founder vesting structure where the bulk vests upon change of control to ensure long-term commitment.6:36–9:16 · Guest disagreement 1/10 Historical Revenue, App Store Ranking, and Customer Base Nathan tests Steven's marketing claim of being the number one sales app in the App Store, prompting Steven to explain Apple's previous category ranking. Nathan also probes whether 4,000 customers represents individual rep seats or corporate accounts.9:16–14:53 · Guest disagreement 3/10 Churn Metrics, Acquisition Channels, and Lighter Capital Debt Nathan pushes back on CAC spending benchmarks and teases Steven about San Francisco venture mindsets. Nathan also catches Steven on a debt round from Lighter Capital after Steven claimed to be purely bootstrapped.14:53–16:55 · Guest disagreement 1/10 2016 Total Revenue Performance and 2017 Annual Targets Nathan calculates the required monthly revenue run rate needed for Badger Maps to hit its ambitious $5M ARR target from its current $140k MRR baseline.16:56–20:30 · Guest disagreement 1/10 The Famous Five Rapid-Fire Questions and Career Reflections A collaborative Famous Five lightning round covering tool preferences, sleep habits, and career advice regarding early-stage companies versus large corporations.2:55–6:36 · Nathan pushing back 3/10 Founding Journey, Co-Founder Dynamics, and Equity Structuring Nathan inquires about founder equity distribution and assumes standard 4-year vesting and acceleration clauses. Steven shares a contrarian founder vesting structure where the bulk vests upon change of control to ensure long-term commitment.6:36–9:16 · Nathan pushing back 4/10 Historical Revenue, App Store Ranking, and Customer Base Nathan tests Steven's marketing claim of being the number one sales app in the App Store, prompting Steven to explain Apple's previous category ranking. Nathan also probes whether 4,000 customers represents individual rep seats or corporate accounts.9:16–14:53 · Nathan pushing back 5/10 Churn Metrics, Acquisition Channels, and Lighter Capital Debt Nathan pushes back on CAC spending benchmarks and teases Steven about San Francisco venture mindsets. Nathan also catches Steven on a debt round from Lighter Capital after Steven claimed to be purely bootstrapped.14:53–16:55 · Nathan pushing back 2/10 2016 Total Revenue Performance and 2017 Annual Targets Nathan calculates the required monthly revenue run rate needed for Badger Maps to hit its ambitious $5M ARR target from its current $140k MRR baseline.16:56–20:30 · Nathan pushing back 1/10 The Famous Five Rapid-Fire Questions and Career Reflections A collaborative Famous Five lightning round covering tool preferences, sleep habits, and career advice regarding early-stage companies versus large corporations.

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

0:00 · Nathan 71.1% · guest 28.9%0:00 · Nathan 71.1% · guest 28.9%3:00 · Nathan 16.9% · guest 83.1%3:00 · Nathan 16.9% · guest 83.1%6:00 · Nathan 34.5% · guest 65.5%6:00 · Nathan 34.5% · guest 65.5%9:00 · Nathan 23.7% · guest 76.3%9:00 · Nathan 23.7% · guest 76.3%12:00 · Nathan 32.5% · guest 67.5%12:00 · Nathan 32.5% · guest 67.5%15:00 · Nathan 62.2% · guest 37.8%15:00 · Nathan 62.2% · guest 37.8%18:00 · Nathan 60.4% · guest 39.6%18:00 · Nathan 60.4% · guest 39.6%21:00 · Nathan 100% · guest 0%21:00 · Nathan 100% · guest 0%
Sharpest disagreement ▶ 14:32 Steven corrects Nathan on VC return models vs debt

Steven firmly reframes Nathan's assertion that venture capitalists look for an annual interest-like return, clarifying that VCs seek 3x to 10x equity multiples.

 Hardest push from Nathan ▶ 11:57 Nathan pushes back on 100% LTV acquisition cost

Nathan directly rejects the notion of spending up to total lifetime value on customer acquisition, attributing that mentality to inflated San Francisco valuations.

 Biggest teaching moment ▶ 5:17 Steven details liquidity-contingent founder vesting

Steven explains why traditional four-year linear vesting fails for co-founders, educating Nathan on tying significant equity portions to change-of-control events.

 Nathan holds their own ▶ 12:50 Nathan calls out bootstrapped claim with debt filing

After Steven claims the company is completely bootstrapped, Nathan demonstrates his preparation by citing their $125k revenue-debt facility with Lighter Capital.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Founding Journey, Co-Founder Dynamics, and Equity Structuring 4423 Nathan inquires about founder equity distribution and assumes standard 4-year vesting and acceleration clauses. Steven shares a contrarian founder vesting structure where the bulk vests upon change of control to ensure long-term commitment.
Historical Revenue, App Store Ranking, and Customer Base 4314 Nathan tests Steven's marketing claim of being the number one sales app in the App Store, prompting Steven to explain Apple's previous category ranking. Nathan also probes whether 4,000 customers represents individual rep seats or corporate accounts.
Churn Metrics, Acquisition Channels, and Lighter Capital Debt 6435 Nathan pushes back on CAC spending benchmarks and teases Steven about San Francisco venture mindsets. Nathan also catches Steven on a debt round from Lighter Capital after Steven claimed to be purely bootstrapped.
2016 Total Revenue Performance and 2017 Annual Targets 5112 Nathan calculates the required monthly revenue run rate needed for Badger Maps to hit its ambitious $5M ARR target from its current $140k MRR baseline.
The Famous Five Rapid-Fire Questions and Career Reflections 2111 A collaborative Famous Five lightning round covering tool preferences, sleep habits, and career advice regarding early-stage companies versus large corporations.

Statements from this episode (14)

Assertion Supported
Benson: Badger Maps subscription tiers are $18, $35, or $66 monthly
“We're a SAS model. So it's a monthly service. It's 18 and 35 or 66 dollars a month.”
Steve Benson Feb 4, 2017 ▶ 2:38
Assertion Not checkable as stated
Benson: Average Badger Maps customer pays probably $35 per month
“Average is probably 35 dollars a month.”
Steve Benson Feb 4, 2017 ▶ 2:51
Insight
Benson: Founders should vest the bulk of their equity upon exit
“The way I would suggest would be a better way to do it is take a small slice of it. Like the amount that you would give like an early VP or someone who's, who's, who's high up in the organization, but not, not a founder and give and invest that portion over fo…”
Steve Benson Feb 4, 2017 ▶ 5:24
Assertion Not checkable as stated
Benson: Badger Maps served around 4,000 customer accounts in early 2017
“I'd say around 4000.”
Steve Benson Feb 4, 2017 ▶ 7:10
Assertion Not publicly verifiable
Benson: Badger Maps ranked as Apple's top sales app for 18 months
“We were the top one in, in the sales apps for about a year and a half until they got rid of the concept of sales as one of their ranking types.”
Steve Benson Feb 4, 2017 ▶ 8:06
Assertion Not checkable as stated
Benson: Badger Maps averages around 3.3% monthly churn
“I think it was at it actually popped up a little bit this last month. I think because people were cleaning up their books, but I guess we average around 3.3%.”
Steve Benson Feb 4, 2017 ▶ 9:21
Assertion Not checkable as stated
Benson: Word of mouth, SEO, and SEM are Badger Maps' top acquisition channels
“The biggest way they find this is, is through just word of mouth. That's the, we track that as being our, the best way that we find people. Second best is is SEO. Third best is SEM.”
Steve Benson Feb 4, 2017 ▶ 9:39
Assertion Not checkable as stated
Benson: Facebook paid marketing has never worked for Badger Maps
“Facebook has never pented out for us.”
Steve Benson Feb 4, 2017 ▶ 10:35
Assertion Not checkable as stated
Benson: Badger Maps' customer acquisition cost via Google is around $300
“I think Google's around 300 dollars.”
Steve Benson Feb 4, 2017 ▶ 11:22
Disclosure
Benson: Badger Maps raised debt through a traditional loan, not convertible notes
“That wasn't convertible notes. That was a traditional loan.”
Steve Benson Feb 4, 2017 ▶ 13:13
Disclosure
Benson: Badger Maps pays around 22% to 23% interest on Lighter Capital debt
“I think it was like 22, 23%.”
Steve Benson Feb 4, 2017 ▶ 14:09
Disclosure
Benson: Lighter Capital did not require a personal guarantee for debt financing
“No, they didn't.”
Steve Benson Feb 4, 2017 ▶ 14:17
Assertion Not checkable as stated
Benson: Badger Maps did around $1.2M in 2016 revenue
“Total revenue. Yeah, yeah, it was actually right around there.”
Steve Benson Feb 4, 2017 ▶ 15:09
Disclosure
Benson: Badger Maps targets $4.5M to $5M in ARR for 2017
“In terms of ARR, I'd like to see it at five. And so yeah. Five million? Yeah, I'd take four and a half though.”
Steve Benson Feb 4, 2017 ▶ 15:20
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