Insight
Savage: Overfunding killed early business video competitors
“Our market's been a very, very good market, but it has taken way longer than people expected. And you can look at the list of competitors we've had in the past, and many of them were overfunded, actually, and that's why they failed, because they tried to get t…”
Insight
Savage: Debt and profitability forced Wistia into long-term thinking
“It's almost like it forced us to be profitable, the debt, and that allowed us and forced us to be long-term focused, which again, these are like the opposite things I expected way before all of this would happen. Like I always assumed that, you know, people sa…”
Insight
Savage: SaaS predictability makes debt financing uniquely powerful
“And like, I think SAS actually can be incredibly, Powerful when matched with debt, because if you understand your unit economics with enough, enough depth, like if you understand churn, if you understand expansion, if you understand acquisition, you can actual…”
Insight
Savage: Targeting one-month payback forces 10x to 20x marketing returns
“What I've noticed is actually that people get obsessed with this, like year payback thing, because everyone says if you're not doing the year payback, then you're not investing enough in growth, but the problem is, like, it's so easy to do dumb stuff or things…”
Disclosure
Savage: Wistia only raised two angel rounds totaling $1.4 million
“We only ever raised two angel rounds. So for a total of 1.4 million, we raised 650,000 in 2008. And another about 800,000, a little less than that in 2010.”
Assertion Not checkable as stated
Savage: Early angel investors held preferred shares with veto power over sales
“Their shares also were preferred shares. And so it meant that they had rights to a board seat. They could block a sale.”
Assertion Supported
Savage: Wistia's tender offer provided roughly a 20x return to angel investors
“Yeah, I can. So there's the two rounds. There's different returns, but it was around 20 X.”
Assertion Not checkable as stated
Savage: Most Wistia employees sold options to join profit sharing
“Most did. So we actually, when we did the offer, what we said was we want to have one incentive structure for everybody. So you can either, you know, hold onto your options, or if you sell your options, you can participate in profit sharing.”
Assertion Not checkable as stated
Savage: Wistia has surpassed $40 million in annual revenue
“Yeah. We're right, right past there.”
Assertion Not checkable as stated
Savage: Wistia swung from -$500K to +$6M EBITDA in one year
“So we had like in 2017, we had negative EBITDA of half a million. And in 2018, we had EBITDA of six million.”
Insight
Savage: Launching educational content triggers same-day spikes in freemium conversions
“One of the best performing things we've ever done has been making content that is just like inspirational, useful content, sending that to free accounts. And that's like a reminder to people of like, oh, hey, I should check out this product. So for years, actu…”
Disclosure
Savage: Wistia Would Turn Down a $180M Acquisition Offer
“Nope.”
Assertion Not checkable as stated
Savage: Wistia reached an $18M revenue run rate in 2017
“Right at the time of the offer, I think we were about, like, an eighteen million dollar run rate or so.”
Assertion Not checkable as stated
Savage: Three companies simultaneously offered to acquire Wistia in 2017
“We actually had three companies approach us at the same time that all said, we want to acquire you”
Assertion Not checkable as stated
Savage: Wistia raised its first funding round at just $1,500 MRR
“When we raised our first round, our MRR was literally. 1000 dollars or like 1500 bucks.”
Assertion Partly supported
Savage: Accel-KKR provided debt financing to Wistia before it was profitable
“And so we worked with Excel KKR to fund the debt and they were willing to write debt against a company that was not profitable. Like we said, we're going to be profitable, but they had a growth fund side of their business.”
Assertion Not checkable as stated
Savage: Wistia gained 3 gross margin points after introducing profit-sharing
“So they went and they spent some time and they came back and like we've made some changes. We've reworked how some things are working and we've got us three points of gross margin.”
Assertion Not checkable as stated
Savage: Wistia's Average Customer Pays Around $100 per Month
“The average customer is around a hundred dollars a month and it's 25 cents per video per month as you add more videos.”
Assertion Not checkable as stated
Savage: Wistia Made $0 in Year One, $13K in Year Two, $150K in Year Three
“Oh, there was no, we basically made no money in the first, in the second we made, like 13,000, and then the third year we made, like, a 150 or something, and it continued to scale at a good pace.”
Disclosure
Savage: Wistia lost money on users by offering unlimited storage
“We made a mistake because we weren't charging based on the amount of storage. We were like, all right, we'll go unlimited and we'll just charge people have a really big audience. And that got a lot of people signing up, but we also ended up completely underwat…”
Assertion Not checkable as stated
Savage: Wistia's gross margins are in the 70s, below typical SaaS
“Yeah, I mean, we, not only were we under 80%, but like, we had a stake with the storage stuff, and like, our gross margins were like high seventies and just started precipitously dropping, and I'm like, Basically, if we didn't make a change, we're going to be …”
Assertion Not checkable as stated
Savage: Wistia has tens of thousands of paying customers
“We've got tens of thousands of paying customers today.”
Assertion Not checkable as stated
Savage: Wistia supports hundreds of thousands of free accounts
“There's a few 100,000 on that.”
Assertion Not checkable as stated
Savage: Around 15% of Wistia's new trials come directly from branded players
“The ones that are directly attributable are probably 15%.”
