Brian and Scottie Elliott, co-founders of Gather, an innovative interior design project management app, dive into their recent surge in monthly recurring revenue, surpassing goals with a current MRR of $8,200. They tackle the psychology of pricing and share insights on raising rates without pushback. The couple also discusses the challenges of transitioning from small firms to enterprise clients, highlighting the ongoing cash burn and the pivotal role of strategic decision-making amidst uncertainty. It's a journey filled with growth, hurdles, and optimism!
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question_answer ANECDOTE
MRR Growth Exceeds Expectations
Brian and Scottie's MRR grew significantly, exceeding their initial goal of $5,000.
They achieved their goal to grow $1,000 MRR in a month, reaching $8,200 total MRR.
question_answer ANECDOTE
Large Enterprise Deal Closed
A large 20-person team initially signed up for a smaller Gather account.
They eventually upgraded to an enterprise plan with 15 users and potential for expansion to other offices.
volunteer_activism ADVICE
Raise Prices Incrementally
Raise prices incrementally as your product improves and you target higher-value customers.
Don't be afraid to raise prices; higher prices can be a positive signal to larger clients.
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Brian & Scottie Elliott are the husband & wife co-founders of Gather, an interior design project management app.
On this episode, Brian and Scottie share with us an update on their unexpected MRR growth, the psychology of raising prices, and the difficulty of making decisions amidst a mountain of unknowns.
The topics we cover
01:07] Update on MRR growth since we last spoke
Had a goal to grow a thousand dollars of MRR in a single month.
Trailing 30 days is like $1,006.
MRR is currently $8,200.
Get caught up in the day to day to actually celebrate. Is good for us to stop and recognize that we have made a lot of progress.
We're still burning more cash than we're making.
[03:53] Closing a large 20-person enterprise deal
They did do a trial.
Then they bumped up to an enterprise plan.
You can have your sights set on a goal and before long you might achieve it. But that's not the end of your journey. You're onto the next hurdle.
This is one of the things I've found so difficult about starting this kind of company, your to do list is never clear and things don't end until you put someone in charge of the company or you sell it.
[05:47] Raising prices, again.
We've even raised twice.
Don't get a lot of price objections.
We have had to reject our previous customer avatar.
Lower prices send a bad signal to them.
The psychology of pricing, both at the founder level and also at the buyer level.
This is a tried and true SaaS playbook. You start at the bottom of the market because you don't have a brand and no one's heard of you and your product is really early, and you don't have the features that you need. You price yourself pretty low. You get a little bit of ttraction, use that to make a better product. You'll find your positioning. You learn more about the market, and then you just go up, up, up from there.
Lower price points, higher churn.
A lot of people don't realize product market fit is not just building a product that people want and are willing to pay for. It's also having a good idea about your positioning and pricing and some idea of channels where you can reach future customers.
You're making a lot of decisions quickly with incomplete information and you only know which ones work in retrospect.
[12:21] Biggest wins so far and looking to the future
In the beginning it felt a little bit scary and unknown when we were leaving, seeing the small teams.
Biggest win: validating with these larger teams.
Biggest win: we are selling into the kinds of firms that we hypothesized we could sell into.
Doing these sales over the last couple of months has just taught me how to sell.
[15:33] Biggest fear right now
That we're going to run out of money.
It's scary to see the bank account dwindle.
Just figuring out how we can keep going and keep growing and even accelerate growth.
How are we going to cross this bridge? Because we can see the green pastures on the other side.
Navigating a world that I don't quite understand yet should be the title and subtitle and every subheading of being an entrepreneur.
I'm most excited to see how we deal with this cash crunch that we're heading into.
Thanks for listening to another episode of TinySeed Tales. If you haven't already, be sure to check out Season 1 of TinySeed Tales where we follow the Saas journey with Craig Hewitt of Castos.
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