Insight
Marketing teams neglect organic acquisition once paid channels are introduced
“Once you allow your marketing team to start using paid marketing as a channel, you will watch them spend all of their time optimizing that paid channel. And almost no time optimizing on organic.”
Disclosure
Kirk Simpson: Wave shifted from Stripe to in-house infrastructure as it scaled
“Our payments business, for instance, was built on top of Stripe. We get to a point of scale and quite frankly, our users want us to deeply integrate it. And so most of this stuff over time, we've been building ourselves.”
Insight
Fintech LTV must use gross margin, not gross payment volume
“Essentially in our business, because we're paying out to Visa and MasterCard and Amex on our payments revenue,
It's important to not look at the gross revenue, but instead to the net, right?
And to like take lifetime times by your net revenue to get a true vie…”
Insight
10% to 15% of SMB churn is uncontrollable business failure
“In small business, you're going to have, to your point before, you're going to have 10 to 15% that are going to naturally go out of business.”
Disclosure
Wave maintains monthly gross logo churn below 2%
“Yeah, we're seeing that we're below two percent.”
Assertion Not checkable as stated
Wave has nearly 200 employees and zero sales reps
“We're closing in on 200 people in the company. We don't have a single sales rep that works here. Not an inside sales rep, not an outside sales rep.”
Assertion Not checkable as stated
Wave freemium users sometimes take 24 months to convert to paid
“And you know, the interesting thing that we see Nathan is that we'll get some people to be paying in the first month. And then we'll have others who are using the free platform for 24 months, and on the 25th month, convert into pay.”
Assertion Not checkable as stated
Wave acquires roughly 70,000 of its 80,000 monthly signups organically
“Of the 80,000, as I've said, you know, about 70,000 are coming in organically.”
Assertion Not checkable as stated
Very few Wave users escalate from Drift chatbots to humans
“The amount of them that are going from the bot into wanting to interact with a human is very small.”
Assertion Supported
Kirk Simpson: 95% of North American businesses have under 10 employees
“About 95% of all businesses in North America are in this size.”
Disclosure
Wave offers free core software to monetize through embedded fintech
“We give away our invoicing and accounting software, 100% for free. And then we monetize by putting payments, payroll lending offers, et cetera, in the application and get those deeply embedded into what the small business owners are doing.”
Assertion Not checkable as stated
Wave's paying customers average $70 to $100 per month
“So up in the 70 to a hundred dollar range on our paying customers for all of their transaction processing, et cetera.”
Insight
Bank connections and invoicing are key early SaaS retention signals
“I mean, things like connect your bank account. So you're importing your transactions send out a couple of invoices, accept a couple of electronic payments, those kinds of things. Those are huge signals of success long-term.”
Assertion Not checkable as stated
Wave maintains a fully loaded CAC under $70
“It is.”
Assertion Not checkable as stated
Wave is growing revenue close to 100% year-over-year
“We're growing at a healthy, healthy clip. We're not quite a hundred, but we're close.”
Prediction Not checkable as stated
Wave will likely surpass $50M in ARR by 2020
“Likely next year.”
Disclosure
Wave plans to pursue M&A roll-ups to expand platform capabilities
“Yes, absolutely. We think the platform is valuable and we'll be at a place soon where we can look at doing that just in terms of robust APIs and more of a microservices type engineering culture.”
