Today, the world is full of tech startups. There is no end to new ones being formed everyday. So why am I a fan of the above 4 companies, some of which, you may not have heard of. There are two reasons; I’ve known them when they were formed, and all four are run differently. Secondly, they are companies I can relate to and learn from than following well known companies, the so called Unicorns.
Buffer
From the four, perhaps Buffer is most known than the others. Buffer was started by Joel Gascoigne and later joined by Leo Wildrich. I was one of the first to see Buffer and I told Joel it will never work, as at that time, the beauty of Twitter was impulsive tweets. He on the other hand thought it would be great to add a time gap between tweets, bringing professionalism to Twitter.
The early success story of Joel was generating revenues within 7 weeks of starting up. Secondly, Buffer is the only company I know that practised lean startup principles at the beginning and it produced amazing results for them.
Traction hit another notch when Leo joined and two became a dynamic duo leading the company to achieve Annual Recurring Revenues (ARR) of $8.4 million recently.
“Today Buffer crossed $700k in monthly recurring revenue ($8.4m annual)! :)Couldn’t be more excited about the journey I’m on with this incredible team and community!”
Posted by Joel Gascoigne on Thursday, 7 January 2016
Moving to San Francisco from Sheffield, UK allowed Joel and Leo to raise a seed round after taking part in AngelPad accelerator. But what’s fascinating more than anything else is their obsession on transparency from revealing salaries to everything else. This is clearly helping them to grow and the term of achieving sustainable differentiation through transparency was born. I doubt I have the guts to be as transparent as Joel and the team is. However, I am sharing how I am building UnifiedVU here, so hopefully that might help others to make less mistakes than I have.
In 2014, Buffer was valued $60 million. And since then they have acquired Respondly, which I will cover later on as it inspired us to build our Twitter app.
CapsuleCRM
CapsuleCRM was founded by two Kiwis in Wilmslow, Duncan Stockdill (CEO) and Phillip Haines (CTO) a suburb of Manchester (ok Greater Manchester). They were supported by Wendy Rule (CFO) from the start. There story is simply beautiful. They’ve financed the initial costs through consultancy whilst building a great CRM product without taking any equity or debt finance.
In 2011, at the same Techcelerate event Joel spoke, Duncan shared how they built a great traction engine.
Unlike Joel, Duncan has adopted a strategy more suited to the old 37Signals model. CapsuleCRM is all about the product, where Buffer’s traction is not just due to a great product, but also down to the genius of Leo in story telling (aka marketing). Whilst CapsuleCRM’s growth is somewhat thanks to their integration partnerships with Xero and Google Apps, they lack a sound sales and marketing strategy, a contentious point between me and Duncan. They are notoriously careful of adding new functionality. But at the same time, they have build an awesome solid product with a great API that we have managed to use in UnifiedVU. I will blog on another day comparing CapsuleCRM API to Salesforce.
According to Dec 2014 Balance Sheet, CapsuleCRM had £1.26 million in cash, which shows how cashflow rich they are. Whilst I have no idea what their ARR might be, my guess is it might be around £5 million, just a wild guess.
Just imagine what the financial results would be if they add VP of Sales and VP of Marketing to their technically strong team. In my humble opinion, they need these two roles to take the company to the next stage. Unlike others, they do not need external capital to achieve this due to strong free cash flow. At least VP Marketing will ensure they feature well in G2 Crowd Grid and others.
I’ve learned a lot from Duncan, and a big fan of him and his company. I praise their brand where ever I can as a Manchester success story (the most beautiful – the purist tech company to emerge from Manchester).
Secondly they have an awesome customer support team run by Josef and Rachel. Josef just moved to Los Angeles which will no doubt help traction in the USA.
CANDDi
CANDDi came about when Tim Langley and Tom Cheesewright pitched to Jon Bradford at another Techcelerate event. It wasn’t the greatest pitch but Tim was known within the northern tech community and Jon decided to give them one of the 8 or 9 slots in UK’s first tech accelerator, Difference Engine. CANDDi took longer to raise their seed round post Difference Engine. At which point Tim brought his MBA buddy Fred Abrard who was doing a stint at Google to run sales. Since then both Tom and Fred have departed the company and Tim is building the company as a solo tech entrepreneur.
Lot of VCs do not touch solo entrepreneur companies at the start. But in the case of Tim, he has already proven that his method works. Whilst I am aware of his ARR, as its not public, I am unable to share it with you.
Tim gives me courage, as I am building UnifiedVU as a solo founder company. We will hire the talent as and when we need, based on capital availability. I’m planning to give share options – but today is not the time to speak about this. Another learning point for me is that he and his team has completely ditched free trials. Instead they have adopted demos, which I am following at this initial stage of UnifiedVU. Tim also got a secret weapon simply goes by the name of Saadia.
Intuitive Business Intelligence
Ed Smith was building a business intelligence product suited to FTSE 100 companies when Tony Bray met Ed at a Techcelerate event. Tony brought years of experience of running Version One, and the cash from its exit to Ed, and together with another angel investor, Intuitive Business Intelligence was born.
Unlike the typical tech startup, they went against the tide. Their product is offered as SaaS, on-premise and hybrid, a mammoth task to maintain different modes of operation.
Tony dabbled with both direct sales and resellers, and today, their 100% of new revenues are generated through the reseller channel. There are significant challenges with this model and many had got their hands burnt, but in Tony’s case, it has done wonders for the company.
I’ve learned a lot from Tony over the years, and especially when I needed some solid advice, he has been there for me. I will share this on another post.
Again, I have no idea what their ARR is but I’m guessing this might be around £3 million mark.
Summary
4 growing tech startups following different models from each other. I wish them all the best and I have been fortunate to see them grow first hand. If you are a tech entrepreneur, who inspires you most and why? What have you learned from those leaders?