Fireside Chat with James Isilay of Cognism: Fundraising during the current economic climate
Dec 26, 2023
auto_awesome
Discussion on the importance of sharing successful experiences, company's organic MRR growth, acquiring a company, skill sets for revenue operations, payment structure for acquisitions, landing big deals, upgrading sales team, company's valuation, goal of going public, and challenges in hiring executives.
Cognizant's revenue growth has been driven by organic means, with its marketing engine playing a crucial role.
Cognizant's M&A strategy focuses on both organic growth and potential acquisitions to fill gaps in its offering and strengthen market position.
Deep dives
Key Point 1: Organic growth driving revenue increase
Cognizant, a SaaS company, has experienced significant growth in revenue, with a current monthly run rate of $52 million, up from $11 million in 2021 and $22 million in 2020. The growth has been primarily driven by organic means, with the company's marketing engine playing a crucial role. Additionally, Cognizant acquired a company called Casper, which contributed to the revenue boost by increasing its annual recurring revenue (ARR) from $1.5 million to around $5 million. The acquisition aimed to enhance Cognizant's skills in a PLG (product-led growth) approach and provide access to a broader market segment.
Key Point 2: M&A strategy and acquisition process
Cognizant's M&A strategy focuses on both organic growth and potential acquisitions. The company aims to invest in new hires, improve sales team skills, and secure enterprise deals to achieve its revenue goals. When it comes to acquisitions, Cognizant actively searches for opportunities to fill gaps in its offering and strengthen its market position. In the case of the Casper acquisition, the decision was driven by customer demand and competition-related factors. The negotiation and acquisition process involved building relationships with the Casper team, understanding their expertise and the synergies they could bring to Cognizant. The acquisition was valued at around $20 million in ARR, with a portion paid upfront and the rest released over time based on hitting certain targets.
Key Point 3: Future plans, IPO aspirations, and challenges ahead
Cognizant's future plans involve focusing on organic growth and profitability in the next couple of years before considering additional options for scaling and potential M&A activities. The company aims to become a unicorn, with a goal of $300 million in annual revenue before going public. Challenges lie in upgrading the executive team, particularly in hiring a new CFO, and further developing the sales team's skills to close enterprise-level deals. Additionally, Cognizant acknowledges the importance of navigating a changing economic landscape and adapting their strategies as market conditions evolve.