Nick Franklin was employee number 6 at Zendesk, the cloud-based customer service platform, where he worked for more than 5 years. He helped grow Zendesk from 9 person startup to a publicly listed company of more than 600. In August 2014 Nick moved to Berlin to launch ChartMogul and secured $600k in seed funding shortly after.
Hi Nick, ChartMogul is a relatively young start-up, so for those who haven’t heard of you yet, can you tell us What ChartMogul does and what Problem you are solving?
ChartMogul helps subscription businesses calculate their revenue metrics and KPIs. This could be a SaaS, monthly gift-box or media subscription – any company that has recurring revenue. We integrate with Stripe, Braintree, Chargify and Recurly.
Is ChartMogul competing against the spreadsheet?
Right now the spreadsheet is in a way our #1 competitor…although the choice isn’t usually a difficult one as we save our customers many days (sometimes weeks) of work (and pain) in Excel.
Which SaaS Metric/s should every SaaS company obsess about?
It really depends on the stage the company is at. At all stages it’s important to watch your churn rate (the rate at which customers are cancelling their subscriptions) as if this is too high it will have a really negative impact on your business and is a good indicator that you need to change something.
In the early stages of a SaaS startup I think customer count, monthly recurring revenue (MRR) and average revenue per account (ARPA) are important to watch.
As you get to the later growth stage, metrics like customer acquisition cost (CAC) and customer lifetime value (LTV) become more and more important as you try and scale as fast as possible in a way that makes financial sense.
What’s the most important thing learnt from your time at Zendesk, that you have brought into ChartMogul?
It’s hard to say exactly as there is an almost infinite number of learnings from joining Zendesk as a startup with nine team members to leaving when it was 500+ people. I had limited knowledge of the enterprise software space and certainly no previous idea about what goes into growing a business like that. I’d also barely sold anything in my life so learning about the sales side of business was extremely valuable.
You recently secured $600k in seed round funding from Point Nine Capital. What advice would you give to other start-ups seeking seed funding?
By November 2014 we had a beta product that was being used and relied on by a handful of real companies, so when we approached Point Nine and others there was a clear path to having a sellable product on the market within a short timeframe with some early signs of adoption. I think if you have this then most angel/seed investors will be interested to talk with you, of course there are a lot of other factors (e.g. market size) but I think having a minimum viable product (MVP) and a few users is usually the minimum entry bar. Also some prior background in the domain you’re going into is really important.
Some people do manage to raise money without a working product, but there’s usually an exceptional team there or some other special thing that makes it worth the additional risk.
by Alex Theuma @alextheuma