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Jan 28, 2017 · 19m · top-founders

EP 553: Prospectify Raises $1M at $4M Post Money Valuation, $25k MRR, for Better Prospecting with CEO Matt Ekstrom

Matt Ekstrom · 8m spoken Nathan Latka · 7m spoken
0:00 / 0:00

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In this episode of The Top, host Nathan Latka interviews Matt Ekstrom, co-founder of Prospectify, examining how the B2B sales intelligence startup bootstrapped to 25,000 dollars in MRR, raised a 1-million-dollar seed round, and engineered proprietary web crawlers to combat customer churn.

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 43.9% of the talking time here. How this is scored →

Nathan as informed peer 4.3 Guest teaching 1.8 Guest disagreement 1.5 Nathan pushing back 3.7
05100:0010:001:29–3:51 · Nathan as informed peer 4/10 Introducing Matt Ekstrom and Prospectify's Product and Pricing Structure Nathan probes Prospectify's pricing and ARPU, playfully teasing Matt about a 404 error on their pricing page. Matt remains cooperative and readily shares the subscription tier pricing.3:52–7:11 · Nathan as informed peer 5/10 Founding Timeline, Early Traction, and Raising a $1M Seed Round Nathan does quick mental math on MRR and valuation multiples. Matt clarifies his numbers, correcting Nathan on the pre- vs post-money terms of their $1M angel round.7:14–9:18 · Nathan as informed peer 4/10 Outbound Prospecting Tactics, Company Search Feature, and Churn Dynamics Nathan inquires about outbound prospecting tactics and customer churn. Matt explains how one-off users like wealth advisors inflated early usage before churning.9:28–12:15 · Nathan as informed peer 6/10 Increasing Customer Lifetime Value and Developing Proprietary Web Crawlers Nathan demonstrates industry knowledge by naming several lead-gen competitors and pressing Matt to disclose his underlying data providers when Matt hesitates.12:15–15:10 · Nathan as informed peer 5/10 Managing Cloud Infrastructure Costs, Future Pricing, and Team Burn Nathan drills into crawler hosting costs and credit mechanics, getting Matt to reveal how they traded product access with AWS and Google for cloud credits.15:12–18:15 · Nathan as informed peer 2/10 Sponsor Segment: Acuity Scheduling Productivity Tool Nathan reads a mid-episode sponsor advertisement for Acuity Scheduling and conducts the rapid-fire Famous Five question routine.1:29–3:51 · Guest teaching 1/10 Introducing Matt Ekstrom and Prospectify's Product and Pricing Structure Nathan probes Prospectify's pricing and ARPU, playfully teasing Matt about a 404 error on their pricing page. Matt remains cooperative and readily shares the subscription tier pricing.3:52–7:11 · Guest teaching 3/10 Founding Timeline, Early Traction, and Raising a $1M Seed Round Nathan does quick mental math on MRR and valuation multiples. Matt clarifies his numbers, correcting Nathan on the pre- vs post-money terms of their $1M angel round.7:14–9:18 · Guest teaching 2/10 Outbound Prospecting Tactics, Company Search Feature, and Churn Dynamics Nathan inquires about outbound prospecting tactics and customer churn. Matt explains how one-off users like wealth advisors inflated early usage before churning.9:28–12:15 · Guest teaching 2/10 Increasing Customer Lifetime Value and Developing Proprietary Web Crawlers Nathan demonstrates industry knowledge by naming several lead-gen competitors and pressing Matt to disclose his underlying data providers when Matt hesitates.12:15–15:10 · Guest teaching 3/10 Managing Cloud Infrastructure Costs, Future Pricing, and Team Burn Nathan drills into crawler hosting costs and credit mechanics, getting Matt to reveal how they traded product access with AWS and Google for cloud credits.15:12–18:15 · Guest teaching 0/10 Sponsor Segment: Acuity Scheduling Productivity Tool Nathan reads a mid-episode sponsor advertisement for Acuity Scheduling and conducts the rapid-fire Famous Five question routine.1:29–3:51 · Guest disagreement 1/10 Introducing Matt Ekstrom and Prospectify's Product and Pricing Structure Nathan probes Prospectify's pricing and ARPU, playfully teasing Matt about a 404 error on their pricing page. Matt remains cooperative and readily shares the subscription tier pricing.3:52–7:11 · Guest disagreement 2/10 Founding Timeline, Early Traction, and Raising a $1M Seed Round Nathan does quick mental math on MRR and valuation multiples. Matt clarifies his numbers, correcting Nathan on the pre- vs post-money terms of their $1M angel round.7:14–9:18 · Guest disagreement 1/10 Outbound Prospecting Tactics, Company Search Feature, and Churn Dynamics Nathan inquires about outbound prospecting tactics and customer churn. Matt explains how one-off users like wealth advisors inflated early usage before churning.9:28–12:15 · Guest disagreement 2/10 Increasing Customer Lifetime Value and Developing Proprietary Web Crawlers Nathan demonstrates industry knowledge by naming several lead-gen competitors and pressing Matt to disclose his underlying data providers when Matt hesitates.12:15–15:10 · Guest disagreement 2/10 Managing Cloud Infrastructure Costs, Future Pricing, and Team Burn Nathan drills into crawler hosting costs and credit mechanics, getting Matt to reveal how they traded product access with AWS and Google for cloud credits.15:12–18:15 · Guest disagreement 1/10 Sponsor Segment: Acuity Scheduling Productivity Tool Nathan reads a mid-episode sponsor advertisement for Acuity Scheduling and conducts the rapid-fire Famous Five question routine.1:29–3:51 · Nathan pushing back 3/10 Introducing Matt Ekstrom and Prospectify's Product and Pricing Structure Nathan probes Prospectify's pricing and ARPU, playfully teasing Matt about a 404 error on their pricing page. Matt remains cooperative and readily shares the subscription tier pricing.3:52–7:11 · Nathan pushing back 4/10 Founding Timeline, Early Traction, and Raising a $1M Seed Round Nathan does quick mental math on MRR and valuation multiples. Matt clarifies his numbers, correcting Nathan on the pre- vs post-money terms of their $1M angel round.7:14–9:18 · Nathan pushing back 3/10 Outbound Prospecting Tactics, Company Search Feature, and Churn Dynamics Nathan inquires about outbound prospecting tactics and customer churn. Matt explains how one-off users like wealth advisors inflated early usage before churning.9:28–12:15 · Nathan pushing back 5/10 Increasing Customer Lifetime Value and Developing Proprietary Web Crawlers Nathan demonstrates industry knowledge by naming several lead-gen competitors and pressing Matt to disclose his underlying data providers when Matt hesitates.12:15–15:10 · Nathan pushing back 5/10 Managing Cloud Infrastructure Costs, Future Pricing, and Team Burn Nathan drills into crawler hosting costs and credit mechanics, getting Matt to reveal how they traded product access with AWS and Google for cloud credits.15:12–18:15 · Nathan pushing back 2/10 Sponsor Segment: Acuity Scheduling Productivity Tool Nathan reads a mid-episode sponsor advertisement for Acuity Scheduling and conducts the rapid-fire Famous Five question routine.

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

0:00 · Nathan 71% · guest 29%0:00 · Nathan 71% · guest 29%3:00 · Nathan 33.4% · guest 66.6%3:00 · Nathan 33.4% · guest 66.6%6:00 · Nathan 24.6% · guest 75.4%6:00 · Nathan 24.6% · guest 75.4%9:00 · Nathan 25.1% · guest 74.9%9:00 · Nathan 25.1% · guest 74.9%12:00 · Nathan 22.1% · guest 77.9%12:00 · Nathan 22.1% · guest 77.9%15:00 · Nathan 74.2% · guest 25.8%15:00 · Nathan 74.2% · guest 25.8%18:00 · Nathan 81.3% · guest 18.7%18:00 · Nathan 81.3% · guest 18.7%
Sharpest disagreement ▶ 12:40 Pushing back on database crawler costs

Matt firmly rejects Nathan's suggestion that their proprietary daily web crawler requires tens of thousands of dollars in fixed monthly server expenses.

 Hardest push from Nathan ▶ 11:15 Refusing dodged question on data vendors

When Matt hesitates and attempts to avoid naming his third-party data sources, Nathan cuts in and insists on getting specific vendor names.

 Biggest teaching moment ▶ 6:08 Correcting valuation terms

Matt interrupts Nathan's valuation math to correct him on the terms, clarifying that the round was four million post-money rather than four million pre-money.

 Nathan holds their own ▶ 9:18 Industry breakdown of data provider retention

Nathan demonstrates domain expertise by citing multiple competing tools (Email Hunter, Toofr, Datanyze, Mattermark) and breaking down their shared retention challenges.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Introducing Matt Ekstrom and Prospectify's Product and Pricing Structure 4113 Nathan probes Prospectify's pricing and ARPU, playfully teasing Matt about a 404 error on their pricing page. Matt remains cooperative and readily shares the subscription tier pricing.
Founding Timeline, Early Traction, and Raising a $1M Seed Round 5324 Nathan does quick mental math on MRR and valuation multiples. Matt clarifies his numbers, correcting Nathan on the pre- vs post-money terms of their $1M angel round.
Outbound Prospecting Tactics, Company Search Feature, and Churn Dynamics 4213 Nathan inquires about outbound prospecting tactics and customer churn. Matt explains how one-off users like wealth advisors inflated early usage before churning.
Increasing Customer Lifetime Value and Developing Proprietary Web Crawlers 6225 Nathan demonstrates industry knowledge by naming several lead-gen competitors and pressing Matt to disclose his underlying data providers when Matt hesitates.
Managing Cloud Infrastructure Costs, Future Pricing, and Team Burn 5325 Nathan drills into crawler hosting costs and credit mechanics, getting Matt to reveal how they traded product access with AWS and Google for cloud credits.
Sponsor Segment: Acuity Scheduling Productivity Tool 2012 Nathan reads a mid-episode sponsor advertisement for Acuity Scheduling and conducts the rapid-fire Famous Five question routine.

Statements from this episode (9)

Disclosure
Ekstrom: Prospectify's plans range from $40 to $975 per month
“So it's 40 dollars a month for a hundred credits. Credits are verified email addresses, meaning we have a very, very high confidence level that it will not bounce. And we go all the way up to custom pricing and all that. But the ones that you can buy on the si…”
Matt Ekstrom Jan 28, 2017 ▶ 3:07
Assertion Not checkable as stated
Ekstrom: Prospectify's average customer pays $352 monthly
“Three 52.”
Matt Ekstrom Jan 28, 2017 ▶ 3:34
Disclosure
Prospectify closes unannounced $1M angel round in Phoenix
“For this round, we actually just closed our first round. It's not been made public yet, but it's local angels. It's a million dollar round post.”
Matt Ekstrom Jan 28, 2017 ▶ 5:18
Assertion Not checkable as stated
Prospectify reached $20k MRR as a two-person team
“We got to 20 K MRR when it was just me and me and Noah, my co-founder, that was it. And we were overwhelmed at that point with customers and users on a daily basis, trying to do support, trying to do everything that a business needs to do. Including continuing…”
Matt Ekstrom Jan 28, 2017 ▶ 6:38
Disclosure
Ekstrom: Prospectify to launch company search with 10-12M US companies
“We're just about to launch our company search, which will include about 10 to twelve million companies starting in the U S where you can do that sort of hyper targeting on the type of company which, you know, and then be able to prospect people on top of that.”
Matt Ekstrom Jan 28, 2017 ▶ 7:25
Assertion Not checkable as stated
Ekstrom: Prospectify annual customer churn is less than 5%
“It's less than five percent churn.”
Matt Ekstrom Jan 28, 2017 ▶ 8:47
Disclosure
Ekstrom: Prospectify used FullContact before building proprietary web crawlers
“We said we didn't use a full contact for sure on the people side, but really that was at a time when we were really trying to validate the concept and we've now built our own proprietary crawlers.”
Matt Ekstrom Jan 28, 2017 ▶ 11:36
Disclosure
Ekstrom: Prospectify Plans Per-Seat Pricing With Unlimited Prospecting Credits
“We're going to have a set monthly per seat license to our company search and we'll extend our plan is to extend unlimited credits on the prospecting side for anybody that has a seat with our company search.”
Matt Ekstrom Jan 28, 2017 ▶ 14:16
Disclosure
Ekstrom: Prospectify Spends $29K–$30K Monthly on Team Salaries
“Think about probably averaging 20 nine or 30.”
Matt Ekstrom Jan 28, 2017 ▶ 14:54
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