Hey - Marc here.

Happy Saturday morning, motivated B2B SaaS Founders!

Here's at least one tip to keep in mind as you grow your B2B SaaS company:

Today's issue takes about 5 minutes to read.

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In today's issue, I share some key takeaways from a recent interview between Nathan Latka, the host of Daily Interviews with SaaS Founders, and Gaurav Bhattacharya, the CEO of Involve. They discussed how their team of 12 hits $2.5m in ARR.

Gaurav grew up in Delhi. He lost his father to cancer at a young age, which led to his first venture, a patient experience platform for doctors. After its success, he moved to the U.S. and delved into AI with the goal of revolutionizing workplace productivity, healthcare, pet care, and finance using AI.

About Involve

Involve started as a B2C application in 2017. They gained many users but struggled to monetize it, facing potential shutdown. They discovered that Verizon had 40k users on their platform who relied on it for community events. Verizon eventually paid them $1.45m, providing the necessary runway.

They raised a $16m series A round last year, resulting in a $64m post-money valuation with a 75% capital retention rate. While they are not profitable yet, they are only burning $90k per month, which is manageable given their cash reserves.

In 2022, they shifted their focus to AI and prediction, achieving $1.5m in ARR. They aim to reach $5m in ARR by the end of the year, with their current MRR at $2.2 million as of June.

They now serve 70 customers and are focused on the mid-market, with an average deal size of $50k. They have recently introduced a self-serve model and launched a Chrome app named R2D2, which garnered 288 users and 13 reviews within ten days.

PS Their team currently consists of 12 members.

Challenges

Limited cash reserves.

After four years of hard work since their launch in 2017, Involve had been struggling to monetize their platform effectively. This struggle had taken a toll on their financial resources. They had reached a point where they had only $16k left in their bank account, nearly shutting down their startup.

Advice to Other Founders

Leverage AI and automation.

They use AI, including models like GPT-3, to enhance their product and drive efficiency. Explore AI solutions for various aspects of your business, such as customer engagement, data analysis, and content generation. Investing in AI capabilities can set you apart and help you scale more efficiently.

Believe in yourself and overcome imposter syndrome.

Imposter syndrome can be a significant hurdle for many entrepreneurs. Focus on self-belief and trust your instincts. Every successful entrepreneur faces challenges and doubts along the way. Recognize your strengths, learn from your failures, and keep pushing forward with confidence in your vision and abilities.

Prioritize organic growth and product excellence.

While fundraising can be tempting, especially in the early stages, Gaurav values organic growth and focuses on building an exceptional product first. Instead of rushing to raise large sums of capital, invest in refining your offering and delivering exceptional value to your existing customers.

TL;DR

Involve currently boasts a monthly revenue of $185k, leaping from last year's $1.5 million and a humble start at just $250k in 2021. Facing a near shutdown with $16k in the bank led them to a game-changing $1.45 million contract with Verizon.

Their Series A round raised $16m, valuing them at $64m, and they still retain a substantial portion of over $10 million. With a team of 12, as they scale, Involve empowers businesses to foresee customer behavior, helping them to expand, maintain, or address churn, ultimately enhancing the customer experience.

PS Here is a link to the full interview if you are interested in listening to the full episode: Team of 12 Hits $2.5m in ARR, $64m Valuation for Customer Success Tool. Can they beat Gainsight?

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See you again next week.

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