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Jun 7, 2016 · 20m · top-founders

EP 318: She Threw Away Old Company, Now Doing $3.3 Million/year, $18,000,000 Raised With MatterMark.com

Nathan Latka · 9m spoken Danielle Morrill · 9m 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 Danielle Morrill, CEO and co-founder of Mattermark, on pivoting from Referly into a SaaS intelligence platform generating a $3.3 million run rate. Morrill breaks down her philosophy on founder equity distribution, proactive churn prevention, customer lifetime value economics, and building long-term compounding enterprise value.

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 50.3% of the talking time here. How this is scored →

Nathan as informed peer 4.3 Guest teaching 3.5 Guest disagreement 1.8 Nathan pushing back 2.0
05100:0010:0020:001:40–4:14 · Nathan as informed peer 4/10 The Origin of Mattermark and Pivoting from Referly Nathan asks standard foundational questions about Mattermark and Referly. Danielle clarifies and corrects his assumption that Referly was merely a pivot, explaining that they shut the previous entity down completely.4:14–7:36 · Nathan as informed peer 5/10 Founding Team Dynamics and Equity Distribution Strategy Danielle breaks down her philosophy on equity distribution and founder compensation, rejecting equal splits as intellectually lazy. Nathan agrees strongly, chiming in with his own observations on founder disputes.7:36–11:19 · Nathan as informed peer 6/10 Financial Metrics, Subscription Model, and Churn Prevention Nathan drills into revenue numbers, contract types, and churn calculations. Danielle explains why calculating SaaS LTV strictly from churn is flawed and educates on using leading engagement metrics instead.11:19–13:30 · Nathan as informed peer 6/10 Customer Lifetime Value, Acquisition Strategy, and Team Expansion Danielle discusses customer acquisition economics and willingness to invest upfront. Nathan demonstrates domain expertise by confirming the calculation represents a fully weighted CAC metric.13:30–16:44 · Nathan as informed peer 5/10 Long-Term Vision, Motivation, and 2016 Revenue Targets Nathan pushes Danielle on whether her personal philosophy of intellectual engagement aligns with investors on her cap table. Danielle explains her balancing act between long-term building and fiduciary duty.16:45–17:49 · Nathan as informed peer 0/10 Mid-Show Promotion and HostGator Sponsorship Mid-roll promotional ad read and sponsor break presented as a solo monologue by Nathan.1:40–4:14 · Guest teaching 4/10 The Origin of Mattermark and Pivoting from Referly Nathan asks standard foundational questions about Mattermark and Referly. Danielle clarifies and corrects his assumption that Referly was merely a pivot, explaining that they shut the previous entity down completely.4:14–7:36 · Guest teaching 5/10 Founding Team Dynamics and Equity Distribution Strategy Danielle breaks down her philosophy on equity distribution and founder compensation, rejecting equal splits as intellectually lazy. Nathan agrees strongly, chiming in with his own observations on founder disputes.7:36–11:19 · Guest teaching 6/10 Financial Metrics, Subscription Model, and Churn Prevention Nathan drills into revenue numbers, contract types, and churn calculations. Danielle explains why calculating SaaS LTV strictly from churn is flawed and educates on using leading engagement metrics instead.11:19–13:30 · Guest teaching 3/10 Customer Lifetime Value, Acquisition Strategy, and Team Expansion Danielle discusses customer acquisition economics and willingness to invest upfront. Nathan demonstrates domain expertise by confirming the calculation represents a fully weighted CAC metric.13:30–16:44 · Guest teaching 3/10 Long-Term Vision, Motivation, and 2016 Revenue Targets Nathan pushes Danielle on whether her personal philosophy of intellectual engagement aligns with investors on her cap table. Danielle explains her balancing act between long-term building and fiduciary duty.16:45–17:49 · Guest teaching 0/10 Mid-Show Promotion and HostGator Sponsorship Mid-roll promotional ad read and sponsor break presented as a solo monologue by Nathan.1:40–4:14 · Guest disagreement 3/10 The Origin of Mattermark and Pivoting from Referly Nathan asks standard foundational questions about Mattermark and Referly. Danielle clarifies and corrects his assumption that Referly was merely a pivot, explaining that they shut the previous entity down completely.4:14–7:36 · Guest disagreement 3/10 Founding Team Dynamics and Equity Distribution Strategy Danielle breaks down her philosophy on equity distribution and founder compensation, rejecting equal splits as intellectually lazy. Nathan agrees strongly, chiming in with his own observations on founder disputes.7:36–11:19 · Guest disagreement 2/10 Financial Metrics, Subscription Model, and Churn Prevention Nathan drills into revenue numbers, contract types, and churn calculations. Danielle explains why calculating SaaS LTV strictly from churn is flawed and educates on using leading engagement metrics instead.11:19–13:30 · Guest disagreement 1/10 Customer Lifetime Value, Acquisition Strategy, and Team Expansion Danielle discusses customer acquisition economics and willingness to invest upfront. Nathan demonstrates domain expertise by confirming the calculation represents a fully weighted CAC metric.13:30–16:44 · Guest disagreement 2/10 Long-Term Vision, Motivation, and 2016 Revenue Targets Nathan pushes Danielle on whether her personal philosophy of intellectual engagement aligns with investors on her cap table. Danielle explains her balancing act between long-term building and fiduciary duty.16:45–17:49 · Guest disagreement 0/10 Mid-Show Promotion and HostGator Sponsorship Mid-roll promotional ad read and sponsor break presented as a solo monologue by Nathan.1:40–4:14 · Nathan pushing back 2/10 The Origin of Mattermark and Pivoting from Referly Nathan asks standard foundational questions about Mattermark and Referly. Danielle clarifies and corrects his assumption that Referly was merely a pivot, explaining that they shut the previous entity down completely.4:14–7:36 · Nathan pushing back 2/10 Founding Team Dynamics and Equity Distribution Strategy Danielle breaks down her philosophy on equity distribution and founder compensation, rejecting equal splits as intellectually lazy. Nathan agrees strongly, chiming in with his own observations on founder disputes.7:36–11:19 · Nathan pushing back 3/10 Financial Metrics, Subscription Model, and Churn Prevention Nathan drills into revenue numbers, contract types, and churn calculations. Danielle explains why calculating SaaS LTV strictly from churn is flawed and educates on using leading engagement metrics instead.11:19–13:30 · Nathan pushing back 2/10 Customer Lifetime Value, Acquisition Strategy, and Team Expansion Danielle discusses customer acquisition economics and willingness to invest upfront. Nathan demonstrates domain expertise by confirming the calculation represents a fully weighted CAC metric.13:30–16:44 · Nathan pushing back 3/10 Long-Term Vision, Motivation, and 2016 Revenue Targets Nathan pushes Danielle on whether her personal philosophy of intellectual engagement aligns with investors on her cap table. Danielle explains her balancing act between long-term building and fiduciary duty.16:45–17:49 · Nathan pushing back 0/10 Mid-Show Promotion and HostGator Sponsorship Mid-roll promotional ad read and sponsor break presented as a solo monologue by Nathan.

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

0:00 · Nathan 69.8% · guest 30.2%0:00 · Nathan 69.8% · guest 30.2%3:00 · Nathan 33.8% · guest 66.2%3:00 · Nathan 33.8% · guest 66.2%6:00 · Nathan 36.2% · guest 63.8%6:00 · Nathan 36.2% · guest 63.8%9:00 · Nathan 36.5% · guest 63.5%9:00 · Nathan 36.5% · guest 63.5%12:00 · Nathan 39.7% · guest 60.3%12:00 · Nathan 39.7% · guest 60.3%15:00 · Nathan 64.9% · guest 35.1%15:00 · Nathan 64.9% · guest 35.1%18:00 · Nathan 73.4% · guest 26.6%18:00 · Nathan 73.4% · guest 26.6%
Sharpest disagreement ▶ 3:48 Danielle rejects the 'pivot' framing

Danielle firmly rejects Nathan's framing that Referly pivoted, explicitly correcting him that the company was completely shut down and rebuilt from scratch.

 Hardest push from Nathan ▶ 15:10 Nathan questions cap table alignment

Nathan challenges whether Danielle's personal goal of staying intellectually engaged matches the financial objectives of external investors on her cap table.

 Biggest teaching moment ▶ 9:55 Danielle breaks down SaaS churn mechanics

Danielle provides a masterclass on SaaS retention, explaining that churn is a lagging indicator and demonstrating why active usage metrics must precede renewal decisions.

 Nathan holds their own ▶ 12:36 Nathan identifies fully weighted CAC model

Nathan demonstrates sharp financial acumen by immediately classifying Danielle's total operating cost division as a fully loaded customer acquisition cost.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
The Origin of Mattermark and Pivoting from Referly 4432 Nathan asks standard foundational questions about Mattermark and Referly. Danielle clarifies and corrects his assumption that Referly was merely a pivot, explaining that they shut the previous entity down completely.
Founding Team Dynamics and Equity Distribution Strategy 5532 Danielle breaks down her philosophy on equity distribution and founder compensation, rejecting equal splits as intellectually lazy. Nathan agrees strongly, chiming in with his own observations on founder disputes.
Financial Metrics, Subscription Model, and Churn Prevention 6623 Nathan drills into revenue numbers, contract types, and churn calculations. Danielle explains why calculating SaaS LTV strictly from churn is flawed and educates on using leading engagement metrics instead.
Customer Lifetime Value, Acquisition Strategy, and Team Expansion 6312 Danielle discusses customer acquisition economics and willingness to invest upfront. Nathan demonstrates domain expertise by confirming the calculation represents a fully weighted CAC metric.
Long-Term Vision, Motivation, and 2016 Revenue Targets 5323 Nathan pushes Danielle on whether her personal philosophy of intellectual engagement aligns with investors on her cap table. Danielle explains her balancing act between long-term building and fiduciary duty.
Mid-Show Promotion and HostGator Sponsorship 0000 Mid-roll promotional ad read and sponsor break presented as a solo monologue by Nathan.

Statements from this episode (13)

Assertion Not checkable as stated
Morrill: Mattermark generated a couple hundred thousand dollars in year one
“I mean, I think it was a couple 100,000 dollars. Pretty small.”
Danielle Morrill Jun 7, 2016 ▶ 2:47
Insight
Morrill: Middleman business models fail to generate strong profit margins
“Yeah, but you know, you don't make a lot of money being the middleman. So we decided let's do something where we're really building the software and where we're the ones creating the value.”
Danielle Morrill Jun 7, 2016 ▶ 3:30
Disclosure
Morrill holds lion's share of Mattermark equity over husband and friend
“I started the company. I recruited my husband to join me. I recruited my friend Andy to join me. So I have the lion's share of the founder equity.”
Danielle Morrill Jun 7, 2016 ▶ 5:35
Opinion
Morrill calls splitting founder equity 50/50 intellectually lazy
“It's intellectually lazy and people should be more thoughtful about it.”
Danielle Morrill Jun 7, 2016 ▶ 7:30
Disclosure
Morrill: Mattermark has raised a little over $18M
“A little over eighteen million.”
Danielle Morrill Jun 7, 2016 ▶ 7:42
Assertion Not checkable as stated
Mattermark MRR is approaching $300K in early 2016
“It's like two, I want to say two 62 75. We're getting really close to 300 now.”
Danielle Morrill Jun 7, 2016 ▶ 8:16
Assertion Not checkable as stated
Morrill: Mattermark has about 500 total customers
“We've got about 500 customers.”
Danielle Morrill Jun 7, 2016 ▶ 8:42
Assertion Not checkable as stated
Morrill: Mattermark annual ARPU grew from $6K to around $10K
“So it's been moving. So now it's coming up to almost 10,000. This is the number we want to see go up over time, obviously. So it started out around 6000 when we started, and now it's around 10,000.”
Danielle Morrill Jun 7, 2016 ▶ 9:00
Assertion Not checkable as stated
Morrill: Mattermark annual churn is under 10%
“I mean, I think, oh, annual churn at this point is like sub-ten percent.”
Danielle Morrill Jun 7, 2016 ▶ 9:50
Insight
SaaS customers actually decide to churn months before their renewal date
“People don't make a churn decision on the date of their renewal. They don't say, oh, I'm not going to use this anymore. They already decided. They decided months ago when they stopped using it.”
Danielle Morrill Jun 7, 2016 ▶ 11:10
Prediction Not checkable as stated
Morrill: Mattermark Customer LTV Expected to Top $50,000
“So we have a really substantial amount of early customers upselling now, too, if we have an enterprise plan that's, like, more in the six-figure range. So I think it's gonna be, you know, in the fifty-k plus range, but I don't know for sure yet.”
Danielle Morrill Jun 7, 2016 ▶ 11:27
Opinion
Morrill admits a $1 billion valuation would far exceed Mattermark's value
“If someone comes along and offers me a billion dollars for Mattermark, that is so far and beyond the value of the company right now at least to me, but if someone else sees that kind of value, you'd have to consider that would be life-changing for every single…”
Danielle Morrill Jun 7, 2016 ▶ 15:37
Disclosure
Morrill: Mattermark Targets $4.8 Million in Revenue for 2016
“I mean, I think if we hit like, you know, basically two X of what we did last year, so 4.8 million, I'd be thrilled. Anything beyond that is just icing on the cake. But I think that's a very solid year. I mean, continuing to grow triple digit, you know, growth…”
Danielle Morrill Jun 7, 2016 ▶ 16:04
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