SaaS Interviews with CEOs, Startups, Founders 849: SaaS: Kinvey Acquired for $50m To Help Frontend Devs Be Backend Devs
Nov 20, 2017
25:35
Sravish Sridhar. He's the VP and General Manager at Kinvey Progress and was previously the CEO and founder of Kinvey before it was acquired by Progress. He's also an angel investor in multiple startups with successful exits.
Famous Five:
- Favorite Book? – Crossing the Chasm
- What CEO do you follow? – Matt Barbey
- Favorite online tool? — If This Then That
- How many hours of sleep do you get?— 7
- If you could let your 20-year old self, know one thing, what would it be? – "I would never become a movie actor"
Time Stamped Show Notes:
- 01:50 – Nathan introduces Sravish to the show
- 02:18 – Kinvey's acquisition closed on June 1st and was announced on June 28th
- 02:30 – Kinvey does "backend as a service", which is a term that they coined
- 02:58 – Schneider Electric has a lot of apps that are used to interact with its hardware, employees and customers
- 03:13 – Kinvey is in charge of the backend features that an app needs
- 03:44 – "We make every frontend developer become a backend developer"
- 03:55 – Developers don't have to learn the backend processes, they can simply drag and drop
- 04:07 – Kinvey has three types of customers:
- 04:10 – First, those who are building apps as a hobby or trial and pay nothing up to $200 a month
- 04:22 – Second, business edition customers who pay an average of $24K a year per application
- 04:44 – Lastly, enterprise edition customers who pay around 6 figures a year
- 05:03 – ACV is around $80K to $90K
- 05:24 – When Sravish came up with the idea for Kinvey, he knew it should be a venture-backed company
- 05:46 – Sravish funded the initial capital of $150K
- 06:06 – Kinvey has raised over $15M before the acquisition
- 06:30 – It took Kinvey 15 month to launch their product
- 06:43 – In the second year, they started to build their revenue
- 07:10 – In 2013, they were doing high 6-figures in revenue
- 07:24 – They broke their million dollar mark in 2014
- 07:54 – Sravish invested in startups to learn strategies and build his financial portfolio
- 09:20 – Sravish has three things he looks for when investing in a startup:
- 09:22 – The team's relationship with each other
- 09:39 – The space of the startup
- 09:55 – The potential he has to help the startup to grow
- 10:40 – Kinvey has over 50 enterprise customers
- 12:54 – The acquisition of Kinvey by Progress was for $50M
- 13:13 – Sravish shares how the board and himself decided on the acquisition
- 14:40 – Sravish's discussion with Progress
- 15:43 – Team size prior to acquisition was 44 and everyone stayed after the acquisition, current team size is 65-70
- 16:00 – Kinvey had multiple offers and it took them 2-3 months to decide
- 16:40 – Progress matched the best offer
- 17:00 – Kinvey and Progress are both based in Boston
- 17:58 – Kinvey had direct sales models and enterprise sales reps
- 18:10 – CAC is $95K to $100K and LTV is $2.1-2.2M
- 18:33 – Payback period is 13-14 months
- 19:04 – Kinvey has 98% retention rate
- 20:40 – Progress has been thoughtful with their employees' restricted stock units (RSU)
- 23:40 – The Famous Five
3 Key Points:
- Choose the deal that will be a great fit for the long-term.
- Always consider the company and, most importantly, your team's future when making decisions.
- Investing isn't just about the financial gains, it's about your ability to believe in and help a company grow and succeed.
Resources Mentioned:
- Simplero – The easiest way to launch your own membership course like the big influencers do but at 1/10th the cost.
- The Top Inbox – The site Nathan uses to schedule emails to be sent later, set reminders in inbox, track opens, and follow-up with email sequences
- GetLatka - Database of all B2B SaaS companies who have been on my show including their revenue, CAC, churn, ARPU and more
- Klipfolio – Track your business performance across all departments for FREE
- Hotjar – Nathan uses Hotjar to track what you're doing on this site. He gets a video of each user visit like where they clicked and scrolled to make the site a better experience
- Acuity Scheduling – Nathan uses Acuity to schedule his podcast interviews and appointments
- Host Gator– The site Nathan uses to buy his domain names and hosting for the cheapest price possible
- Audible– Nathan uses Audible when he's driving from Austin to San Antonio (1.5-hour drive) to listen to audio books
- Show Notes provided by Mallard Creatives