The Exchanges

Q So on, on average, what, what is one of these business paying you guys per month?

A Uh, it varies. We have, um, Today we really have two kinds of customers. We have like, we have a small business kind of channel that is probably more the kind of QuickBooks based business, or maybe they're running zero or something like that. And those companies pay us, you know, uh, there's a range, but probably somewhere from sort of five to 20,000 dollars a year for the smaller businesses. Um, and then the larger businesses that we work with pay us, you know, Kind of go from there up, right? So kind of mid five figures up into the kind of lower six figures, um, is, is where our customer base goes for the kind of bigger companies.

AI assessment note: “somewhere from sort of five to 20,000 dollars a year for the smaller businesses”

Q Okay, that's actual companies, they're paying you with their credit cards, they're actively using you, etc. Right. Okay, and it sounds like ways that you're kind of driving MRR expansion, ARPU expansion is depending on number of seats, are there any kind of value based, other value based metrics you're using to charge more per company?

A Um, so we, the, the pricing model for, um, our sales rep product is pretty straightforward. It's, it's very Salesforce-like, you know, per seat, per, per year. Um, on the e-commerce side, look, there's a lot of variables in, um, in the complexity of the, of the, of the experience that someone needs. Like, all these industries work in very different ways. Um, so the pricing on that is, is kind of made to order, I guess, I guess you could say. Um, but we don't have what you would think of as like, um, we're not inside the transaction. If that, if that's what you mean, we don't charge a per transaction fee. Um, we don't take a cut, uh, like that.

AI assessment note: “we don't charge a per transaction fee. Um, we don't take a cut”

Q And that's gross customer churn. If you add in upsells, are you guys adding that net negative revenue churn yet?

A Yeah. We're, we've always had net negative revenue churn because like the things for us is like, you know, they might buy a couple of sales rep licenses and then they can always add more sales rep licenses and that tends to happen. And then they might say, great, the sales rep, our sales reps are loving this. Let's get your e-commerce thing to give to our customers. So we have a lot of both like seat expansion and product expansion kind of opportunity. So our net churn has always been great. It's always been negative. Um, it's just like that gross churn number, you know, even with a really good net negative churn story, you don't want to have a big, uh, sorry, a net And you know, even with a negative net churn story, you still don't want to have a big gross churn story.

AI assessment note: “We've always had net negative revenue churn”

Q Okay, that's actual companies, they're paying you with their credit cards, they're actively using you, etc. Right. Okay, and it sounds like ways that you're kind of driving MRR expansion, ARPU expansion is depending on number of seats, are there any kind of value based, other value based metrics you're using to charge more per company?

A Um, so we, the, the pricing model for, um, our sales rep product is pretty straightforward. It's, it's very Salesforce-like, you know, per seat, per, per year. Um, on the e-commerce side, look, there's a lot of variables in, um, in the complexity of the, of the, of the experience that someone needs. Like, all these industries work in very different ways. Um, so the pricing on that is, is kind of made to order, I guess, I guess you could say. Um, but we don't have what you would think of as like, um, we're not inside the transaction. If that, if that's what you mean, we don't charge a per transaction fee. Um, we don't take a cut, uh, like that.

AI assessment note: “pricing on that is, is kind of made to order”

Q And that's gross customer churn. If you add in upsells, are you guys adding that net negative revenue churn yet?

A Yeah. We're, we've always had net negative revenue churn because like the things for us is like, you know, they might buy a couple of sales rep licenses and then they can always add more sales rep licenses and that tends to happen. And then they might say, great, the sales rep, our sales reps are loving this. Let's get your e-commerce thing to give to our customers. So we have a lot of both like seat expansion and product expansion kind of opportunity. So our net churn has always been great. It's always been negative. Um, it's just like that gross churn number, you know, even with a really good net negative churn story, you don't want to have a big, uh, sorry, a net And you know, even with a negative net churn story, you still don't want to have a big gross churn story.

AI assessment note: “Yeah. We're, we've always had net negative revenue churn”

Q What are you aiming right now in terms of, uh, kind of target growth rate month over month in terms of, uh, revenue growth?

A You know, for a SaaS company at our stage, like, you know, doubling every year is the kind of gold standard. So that's the standard we hold ourselves to. Um, so you want to be doing, you want to be doing a hundred percent growth per year. I think, you know, with what's gone on in the, in the kind of public markets, you know, what's happened to like SaaS valuation multiples in, in the past year and the kind of the swing, probably a little bit away from like growth at all costs towards, you know, a little bit more. Profitability, like fiscal, uh, responsibility. Um, you know, for me at this point, I care more about delivering a hundred percent growth with a better payback period than I care about delivering 200% growth with like a terrible payback.

AI assessment note: “doubling every year is the kind of gold standard. So that's the standard”

Q So on, on average, what, what is one of these business paying you guys per month?

A Uh, it varies. We have, um, Today we really have two kinds of customers. We have like, we have a small business kind of channel that is probably more the kind of QuickBooks based business, or maybe they're running zero or something like that. And those companies pay us, you know, uh, there's a range, but probably somewhere from sort of five to 20,000 dollars a year for the smaller businesses. Um, and then the larger businesses that we work with pay us, you know, Kind of go from there up, right? So kind of mid five figures up into the kind of lower six figures, um, is, is where our customer base goes for the kind of bigger companies.

AI assessment note: “somewhere from sort of five to 20,000 dollars a year”

Q What are you aiming right now in terms of, uh, kind of target growth rate month over month in terms of, uh, revenue growth?

A You know, for a SaaS company at our stage, like, you know, doubling every year is the kind of gold standard. So that's the standard we hold ourselves to. Um, so you want to be doing, you want to be doing a hundred percent growth per year. I think, you know, with what's gone on in the, in the kind of public markets, you know, what's happened to like SaaS valuation multiples in, in the past year and the kind of the swing, probably a little bit away from like growth at all costs towards, you know, a little bit more. Profitability, like fiscal, uh, responsibility. Um, you know, for me at this point, I care more about delivering a hundred percent growth with a better payback period than I care about delivering 200% growth with like a terrible payback.

AI assessment note: “doubling every year is the kind of gold standard. So that's the standard”

Q There you go. Alright, so, so tell us what Handshake does, and what's your business model? How do you make money?

A Great. So, uh, as you kind of just pointed out, um, Handshake is about getting the right product to every shelf, uh, in the world. Um, and so that's, you know, think about every store you've ever gone into, whether it was a shoe store or a grocery store or the hardware store, all the products on those shelves that we buy as consumers. How did they get there? Well, the way they get there is that the upstream suppliers have to sell them into those stores. And the thing that most people don't know Is that even though for you and I, Nathan, the world of buying things, ordering things has become the world of Amazon. You know, if I want to order a car, I pick up my phone and I order an Uber. If I want to order food, I pick up my phone and I order seamless. The world that you and I are in, where we get to order things really easily, that world, one step back in the supply chain is totally broken, and it's all pen and paper and phone, fax, email. Imagine if we went back to the eighties, And instead of ordering something from Amazon, I had to pick up a mail order catalog and send in a form to order a pair of shoes from, you know, the place that I wanted to buy it. So that's the world that those businesses are still in. And so what Handshake does is we basically bring that Amazon-like, modern, technology-powered, um, buying and selling experience to businesses so that when the shoe store…

AI assessment note: “what Handshake does is we basically bring that Amazon-like, modern, technology-powered”

Q There you go. Alright, so, so tell us what Handshake does, and what's your business model? How do you make money?

A Great. So, uh, as you kind of just pointed out, um, Handshake is about getting the right product to every shelf, uh, in the world. Um, and so that's, you know, think about every store you've ever gone into, whether it was a shoe store or a grocery store or the hardware store, all the products on those shelves that we buy as consumers. How did they get there? Well, the way they get there is that the upstream suppliers have to sell them into those stores. And the thing that most people don't know Is that even though for you and I, Nathan, the world of buying things, ordering things has become the world of Amazon. You know, if I want to order a car, I pick up my phone and I order an Uber. If I want to order food, I pick up my phone and I order seamless. The world that you and I are in, where we get to order things really easily, that world, one step back in the supply chain is totally broken, and it's all pen and paper and phone, fax, email. Imagine if we went back to the eighties, And instead of ordering something from Amazon, I had to pick up a mail order catalog and send in a form to order a pair of shoes from, you know, the place that I wanted to buy it. So that's the world that those businesses are still in. And so what Handshake does is we basically bring that Amazon-like, modern, technology-powered, um, buying and selling experience to businesses so that when the shoe store…

AI assessment note: “we basically bring that Amazon-like, modern, technology-powered, um, buying and selling experience to businesses”

Q customers, right? Where to spend money to get, you know, customer acquisition. Um, I know you have kind of, it sounds like you have two very distinct cohorts, you know, one's under 50 grand ACV, one's above 50 grand ACV, but generally speaking, what do you project in kind of your board decks and your assumption cells and Excel sheets, the lifetime value of one of your businesses or customers?

A Well, I mean, the lifetime, I don't think that much about lifetime value, because that, that, that depends a lot on how much you're paying, right? And different cohorts behave differently. What, what I think about, and what a lot of the, the SaaS, um, the SaaS investors and, you know, the kind of people who are thinking really well about economics are thinking about payback period, right? Because that's the kind of, that's the, uh, The, the kind of speed limit on how fast you can grow and like what the cash efficiency of the business is. And so a lot of what we're spending time on right now is thinking about how can we get our payback period into a place that we feel, um, is right for the business is the right blend between, um, growing fast because the faster you try to grow, like the more sales reps you hire. Well, every time you hire a sales rep, they've got a, you know, six month ramp in front of them where, you know, They're collecting a base salary, but they're probably not delivering that much new revenue. And so the faster you go on that side, the worse your payback period gets because you're supporting a larger go to market team.

AI assessment note: “I don't think that much about lifetime value... What I think about... is payback period”

Q customers, right? Where to spend money to get, you know, customer acquisition. Um, I know you have kind of, it sounds like you have two very distinct cohorts, you know, one's under 50 grand ACV, one's above 50 grand ACV, but generally speaking, what do you project in kind of your board decks and your assumption cells and Excel sheets, the lifetime value of one of your businesses or customers?

A Well, I mean, the lifetime, I don't think that much about lifetime value, because that, that, that depends a lot on how much you're paying, right? And different cohorts behave differently. What, what I think about, and what a lot of the, the SaaS, um, the SaaS investors and, you know, the kind of people who are thinking really well about economics are thinking about payback period, right? Because that's the kind of, that's the, uh, The, the kind of speed limit on how fast you can grow and like what the cash efficiency of the business is. And so a lot of what we're spending time on right now is thinking about how can we get our payback period into a place that we feel, um, is right for the business is the right blend between, um, growing fast because the faster you try to grow, like the more sales reps you hire. Well, every time you hire a sales rep, they've got a, you know, six month ramp in front of them where, you know, They're collecting a base salary, but they're probably not delivering that much new revenue. And so the faster you go on that side, the worse your payback period gets because you're supporting a larger go to market team.

AI assessment note: “I don't think that much about lifetime value... What I think about... is payback period”