The SaaS Podcast
Chili Piper: How to Pre-Sell and Bootstrap a SaaS to Profitability – with Nicolas Vandenberghe 
Chili Piper: How to Pre-Sell and Bootstrap a SaaS to Profitability
Nicolas Vandenberghe is the co-founder and CEO of Chili Piper, a SaaS platform that helps you instantly turn inbound leads into qualified meetings.
Nicolas grew up in France and wanted to travel around the world. He applied to Stanford so he could live in California for a couple of years before continuing his travels.
But all his plans changed when one day Steve Jobs gave a talk to his class. Nicolas was so inspired that he decided he was also going to become a tech entrepreneur.
Ironically, Nicolas's first startup was co-founded with John Sculley, the guy who became CEO of Apple and eventually fired Steve Jobs.
Nicolas's latest startup Chili Piper was founded when he and his wife identified a niche problem with companies losing leads because they couldn't respond quickly to inbound leads.
He wanted to be sure he was solving a worthwhile problem, so he told his first potential customer that he could build them a solution for $20,000. The customer paid him upfront.
And that's how they got started. But like most startups, when you look deeper you also discover a bunch of problems and challenges. And it was no different for Nicolas.
He said most people wake up and check their email every morning, but he used to check his bank account and worry if they had enough pay to pay the bills. And at one point, he ran out of money and couldn't pay his employees.
However, despite those challenges, they bootstrapped the company from zero to over $5M in annual recurring revenue (ARR) and recently raised $18 million in funding.
It's a great conversation with a serial entrepreneur who shares a lot of useful insights. I think you'll find this story inspiring and entertaining.
Omer: [00:00:00] Welcome to another episode of The SaaS Podcast. I'm your host Omer Khan. And this is the show where I interview proven founders and industry experts who share their stories, strategies, and insights to help you build, launch and grow your SaaS business. In this episode, I talked to Nicolas Vandenberghe, co-founder and CEO of Chili Piper, a SaaS platform that helps you instantly turn inbound leads into qualified meetings.
[00:00:38] Nicolas grew up in France and wanted to travel around the world. He applied to Stanford, so he could live in California for a couple of years before continuing his travels. But all his plans changed when one day Steve Jobs gave a talk to his class. Nicolas was so inspired that he decided that he was so going to become a tech entrepreneur.
[00:01:01] Ironically, Nicholas's first startup was co-founded with John Sculley, the guy who became CEO of Apple and eventually fired Steve Jobs. Nicolas's latest startup Chili Piper was founded when he and his wife identified a niche problem with companies losing leads because they couldn't respond quickly enough to inbound leads they received from their website.
[00:01:25] You want it to be sure he was solving a worthwhile problem. So he told his first potential customer. That he could build them a solution for $20,000. The customer paid him upfront and that's how they got started. But like most startups, when you look deeper, you also discover a bunch of problems and challenges, and it was no different for Nicholas.
[00:01:47] He said, most people wake up and check their email every morning, but he used to check his bank account. And worry if he had enough money to pay the bills. And at one point he ran out of money and couldn't pay his employees. However, despite those challenges, they bootstrapped the company from zero to over $5 million in annual recurring revenue, and recently raised $18 million in funding.
[00:02:15] It's a great conversation with a serial entrepreneur who shares a lot of useful insights. I think you'll find this story inspiring and entertaining. Nicolas, welcome to the show.
Nicolas: [00:02:25] Thank you. And thanks for having me.
Omer: [00:02:27] Do you have a quote, something that inspires or motivates you that you can share with us?
Nicolas: [00:02:33] I'll tell you why. I have two there's one that says. Inspire me all my life it's originally in Latin is a “Fortune favors the board” right? The idea that you're going to be lucky if you take risks and be brave. I think I wrote that too when I was 17 somewhere and I've kept it on and along. And then more recently as a new startup and new ups and downs, I came across a code that they actually printed and put it on my desk and I have it in front of me.
[00:03:03] Somebody said, In the end, I always win. And if I'm not winning, it's not the end. And I find that very appropriate for a SaaS company because you go through up and down and you get to think if I'm not winning, it's just to continue until I do win. So that what is inspiring me these days.
Omer: [00:03:21] I really liked that. Actually. I really like both of them, but, that one in particular, I think, you know, most of us could probably look at that every day and find some, some inspiration or motivation to keep going, especially on the bad days. All right. So for people who aren't familiar with Chili Piper, can you just give us an overview?
[00:03:42] What does the product do? Who is it for? And what's the main problem that you're helping to solve?
Nicolas: [00:03:48] Sure. So we are a sales tech company. We help sales team and marketing teams are. The core product is actually very simple to understand when companies spent a lot of hours. to most B2B companies to attract visitors to their website.
[00:04:02] The call to action is a form. So you have a form. You say, contact us and the prospect filled the form. And upon submission, they get a thank you page. Thank you, somebody's going to call you. And the prospect is left wondering what was going to call me and when, and the amazing industry secret did that companies lose more than half their prospects in this interaction.
[00:04:25] People are proud to convert at 40%, which means that they actually lose 60% of their spot prospects because nobody called them back, which was a Sunday and it took too long or the prospect disappeared. So we've built this intelligent agent that our customers put in their web page upon the form submission when a prospect comes here, like to talk somebody in real-time, we're going to find, we're going to qualify that prospect and make sure that he's the right target. Then we're going to find the right rep to take the meeting and we can dial the reps phone and dial the prospects, put them in touch in real-time.
[00:04:55] Or we can retrieve a calendar and have the prospect book, a meeting. And as a result, conversion rates have also go from 40% to 80%. So that's our core business, we call that inbound and revenue acceleration. Because that's exactly what it does is by inbound and it accelerates revenues and doubles your pipeline.
[00:05:16] And from there, we've expanded it to a suite of booking tools and workflows around meetings. So all the pieces that you may need. So for example, to agree on the attempt to meet by email, we have these smart suggested times where. I can send you three times and you should click on it. We'll book the meeting in one click.
[00:05:33] We also have signature on the desk smart, where you can book a meeting from a signature. So we've expanded to, a suite of tools on meetings, that's what Chili Piper does.
Omer: [00:05:42] So how did you come up with the idea for this business?
Nicolas: [00:05:46] A lot of companies are started around late '80s. I have an idea and I'm going to do this is my fourth company. And it was done a bit differently. We started with, with a thesis, not an idea. The thesis was that the world of sales is going to be changed by digital apps. And, it's going to be a huge market. That's what we want you to do. So, and when I say we, I started actually with my wife Alina who was running product at Pearson and before that at Bloomberg.
[00:06:14] So she had a lot of structures in B2C apps. She had a very successful launches. For example, one of our apps was coded by Steve Jobs when he launched the iPad.
Omer: [00:06:25] What app was that?
Nicolas: [00:06:26] She was at Thomson Reuters was at the time and, it was a news app. So we showed all the, all the different categories on the iPad and for news should be some songwriters app that she had designed.
[00:06:36] Right. So we had these thesis and then we decided to go to markets and we came up with the original idea. We actually didn't come up with it. We talk to potential customers and ask them what problems they had. And one customer said, I have this problem of booking meetings, so my prospecting team needs to book meetings for my selling a team and we need to round-robin, these meetings. It's very complicated they get confused and which should come to executives. They should book with, can you help with that? So we said we will help we'll build a solution, but you have to prepay $20,000. And they said, yes. And then we checked a bunch of other companies say, Hey, do you have this problem of a handoff between teams around this meeting and scheduling?
[00:07:22] And we found that half the companies we talk to at the same problem. So that's how we got started. We got a real commitment. There was money upfront because the problem was serious and we knew that other companies it's the same problem. And once we got in the business, then we can, we look at other problems around, around meetings, on booking and we Came across that inbound process that's broken.
[00:07:43] And he said to find the solution for that. So we went in steps and we started with something that was actually brought to us by a customer. That's how we did it.
Omer: [00:07:54] Who was that first customer?
Nicolas: [00:07:56] It's a company called Fivestars in San Francisco. They do loyalty programs for small businesses. So they have a high volume of, customers. They need to book very fast, right. Especially in the B to SMB. If you wait too long, you lose a customer. So it used to be the process where somebody would be on the phone. With a potential customer and you would take them seven minutes to book the meeting in seven minutes, you have to hang up the phone, the prospect is not confirmed, so you have a lot of leakages. So they, were, it was a mission-critical for them to get that process streamlined. And after that, the second customer was company in New York or Greenhouse, a SaaS company, well known. It does that they, the same problem and they were very focused on efficiency and they were willing to take a bet on a startup and buy your products.
Omer: [00:08:47] So I'm kind of a little curious about this because when I was looking at Chili Piper and this whole idea of, you know, a scheduling app that's, that's used by sales teams, I was kind of like, isn't this similar to a lot of other scheduling tools that you might get out there, like, you know, Calendly or x.ai or these types of things.
[00:09:12] And then the way that you've described it is obviously it's kind of more sophisticated and there's a particular kind of, couple of use cases that you're kind of going out and solving, but. I'm curious when you talk to these customers, had they tried those types of solutions and not being able to make them work for a particular reason.
[00:09:34] It just seems like, you know, when I look at what you've built with the business today, it's pretty impressive yet when, if we try to travel back in 2016 and sort of look at the opportunity. I would be thinking well, is there really that much of an opportunity when there's already these type meet so many different types of solutions out there? So what, what is it that I'm missing here?
Nicolas: [00:09:57] Yeah, yeah, no, that's a good question. The answer to your question is yes, they have tried with other solutions and the, prominently that this skinning solution is quite simple. exposing available calendars is quite trivial and something actually you would need in, in a, in a week.
[00:10:12] So. What we went after is a much more complicated problem is scaling in the context of a process that thinks that's what people get confused when, and they can cheat because I was scheduling, they are scheduling. Well, there may be a lot of scheduling, but our solution for inbound that we are the only ones.
[00:10:27] So we have a no discount policy and we never discount because we never, we never under competition pressure on pricing because we are the only one. So it's all in the details, right? If you're looking at the inbound process is where the format can put Calendly one of these, but it doesn't work that way because you have to qualify the prospect.
[00:10:47] You have to route, you have to check-in Salesforce that whether there's an existing account or not, or in another CRM, you get to do all sorts of, of steps in the workflow. And the actual scheduling pieces is a small piece in that, in that sense, assemble. And when faced other the time, ask us to solve the problem, we understood it was the skin of piece. It was a small piece compared to the rest of the solution and same thing now. Right? So it's not, it's all about the entire process and all the things that need to happen around you that are, that are complex. The interesting thing now, grown products that they're return on investment is very obvious because we double the pipeline, right?
[00:11:30] So the, what is the stake is very high and companies are willing to pay money to get the free automated solution if it's going to double their pipeline. So that that's the thing is it's all about the details of the workflow and what it needs to happen. And it's actually, it's actually quite complex. In addition, we have to integrate with multiple systems. So, the form is typically owned by the marketing team. So like, let's say they use Marketo or HubSpot or Eloqua. So you have to make sure you integrate with the form. The CRM is another anymore, so typically Salesforce. So I've started, then we a have 20, which we. Zoom, for example, a WebEx like the scaling solution. We, so we have to put all the pieces together. Internet is more complicated than it looks from the outside.
Omer: [00:12:16] Yeah. And I think the key, what you just said is like, you know, doubling the conversion, which is ultimately what the customers care about. I'm curious, when you said to, Fivestars, it's going to cost you $20,000 for a solution.
[00:12:33] Where did that number come from? Were you sort of thinking about this is, you know, what it's going to take to build an initial product or was it just a way of just validating how serious they were about this.
[00:12:45] Yeah, the
Nicolas: [00:12:45] latter. I just want to. The amount that was significant enough that it was helpful to us and the commitment to them, but low enough that they will say yes.
[00:12:56] I mean, I think it would have been worth a lot more to them to do that pay a lot more, but it would have taken longer. It would've been a longer process. I was quite eager to get started. That was how we came up with these amounts.
Omer: [00:13:09] With this business, you bootstrap this too. To about $5 million ARR, and then you've taken some funding and we'll talk about, you know, what you've been doing there. And I think you hit profitability like in, in year one. Is that right?
Nicolas: [00:13:32] That's right.
Omer: [00:13:33] So I want to talk about that, but before we do that, I think it would be really helpful just to talk a little bit more about. Some of your other companies, what you've done and sort of how you arrived here. That, that I think is an interesting part of the story that I want to make sure we, we sort of talk a little bit about set the context and then we'll sort of dig into what that first year looked like.
Nicolas: [00:13:57] Yeah. So, as I mentioned earlier, it's my fourth company. The story is I grew up in the South of France. Didn't know anything about entrepreneurship. So I just want you to travel around the world and, And I thought, you know, a good way to do that is to apply to Stanford Business School. that will give me two years in California and then continue on my way.
[00:14:19] And my plan was to go to Hong Kong, it's ironic because the Hong Kong is he is the only place in whatever few places in the world I haven't been to. And when I got to Stanford a few weeks into it, one of my classmates invited Steve Jobs to talk to us. And at the time Steve Jobs was running Next and the joke was that he was going next to nowhere.
[00:14:38] And Steve Jobs sat on the floor and saying, telling us about how you started Apple and why he started Next and things. And they looked at that unbelievable. That's what I want to be when I grow up, I want to be a tech entrepreneur. And so I stayed in the Bay area. And then it was said that this was going to do so upon graduation.
[00:15:01] I started my first company and fate as his twists were like partner in my first company, was John Sculley, the very CEO, right, exactly. The very CEO fired Steve Jobs. It was just chance. I met Timmy. We met to go with technology. We agreed on launching. What we did is it was Photoshop for dummies. So a way to where you could call it, the grandfather of Instagram was a way to manipulate your photos on a PC.
[00:15:33] So I started that business in 1995 and we did 6 million in revenue the second year for the first year of shipment. And you haven't been in the year after and, And so that was going really well. Actually, we got an offer from a gaming company for 55 million in the end. Sculley was not keen on taking it.
[00:15:53] So I sold my shares and I started another company because I want you to buy now it's 1998 and everybody's doing internet around me. So I thought as I see what it should be, the internet, the future, and I should be a player. So I started a second company. That when it was a bit crazy, the idea of doing a universal shopping cart.
[00:16:13] So helping websites with the shopping cart meant I'm watching a website and we grew to 65 people in 11 months with tons of customers. Then I got an offer to buy that company for $60 million. And I invested all my money in it. So I had three quarters of the company. So I was going to key up 45 million for 12 months of work, it looked too good to be true. And that the deal didn't close in the end, the acquiring company was CNET at the time of the dot bomb. So their stock dropped then CEO called me and said, we couldn't do the deal, to look at talk to investors. And in the end, I have to lay off more than half the team and did a poor deal with Microsoft. So that was my second company.
Omer: [00:17:00] So when you were in talks to, to sell the product was Red Card when you were in in talks to sell that for 60 million, when you look back at that, do you think it was like, did it just take too long? And you know, you sort of think, Oh, if we'd only been able to kind of negotiate and close this sooner, I would have had a, more of a successful exit there.
Nicolas: [00:17:22] I think fortunately for me, I didn't take too long. Right. Just thought about it and say, okay, let's do it. And I agree. So I actually have nothing to blame myself for. I said and the deal didn't happen, that is one of the things that the market turned on us and nobody had seen it coming. Right. Even when it started happening, because I always just correction nobody, this the way human brain works. You know, it's hard to, to anticipate that things that are going so well could go so badly all of a sudden. So at the time I was in San Francisco, when the first correction happened, everybody thought it would continue. So I didn't, there was not much I could have done the market channeled me and that's what happened. So.
Omer: [00:18:09] And so how much did you end up selling it for?
Nicolas: [00:18:12] It was a single digit acquisition by Microsoft. They waited and waited until I was very, very desperate. And then, okay, let's do it. that's everything very. Yeah. I remember that. They asked me to move to Seattle. I declined. so my team moved to Seattle and me we had this huge warehouse as an office. It was the coolest office. And, I faxed everything. Yeah. I locked the warehouse. I dropped the box at a friend's house and they took her in the airplane to fly to Nepal, to earth, good tracking in the Himalaya to recover.
[00:18:51] Cause I ended up not making any money myself on the deal because we had invested in things. So I'd say, you know what I figure. I'm going to go to the mountains and see people who live on the, you know, $50 a month and then stop complaining about it. So that's what happens. It works very well. You always see people more challenging than you are and put things in perspective.
Omer: [00:19:16] Yeah, definitely. It gives you a lot, a lot of perspectives. Okay. So that was company two.
Nicolas: [00:19:23] Company two, then, then I did a third one that I sold quickly in biometrics. That I sold well, and then I thought I should become a VC. I assume that that's what entrepreneurs do when they grow up, they become investors. So that was wrong.
[00:19:37] I was interested in being a VC, so I did different things. And then I help a friend. That's how I came up with Chili Piper. I help a friend at a telecom company or any sales team. So I was the VP of sales. That was 2011, 2012. And, When they actually studied setting up the systems and it put everybody on the Salesforce.
[00:20:00] I was amazed that Salesforce hadn't changed. Essentially. Hadn't changed in 10 years and all the reps were reluctant to use it. And I thought she's crazy because the hard that I'm stopping my daughters from using the technology and here's the salespeople. You have to beg them to use it. There should be these beautiful technologies available to salespeople.
[00:20:21] So that's, that's the thesis on Chili Piper. I thought, you know what? I was going to change. Somebody's going to come up with super cool tool that salespeople love and supposed to hate and have to use. And that's going to be a choose market. So that's how Chili Piper started.
Omer: [00:20:39] So I think all these different companies that you, you started and sold, there was obviously a lot of experience you, you build top from that. So as we get to year one of Chili Piper, how did you think about that? And what, what were you able to like, what specifically did you do to be able to get to profitability in year one?
Nicolas: [00:21:07] I guess it'd been marked by this Red Cart experience. Right? So this time I thought, you know, essence of company's revenues. So I want to go to revenues as fast as possible. So then we go, we went literally to the zero because we actually had the prepayment from Fivestars. So when we, when we started and so we, Allina and I put together a very small team or developers were actually in, in Eastern Europe and we went fast to revenue and then we start to get to cash positive as soon as possible.
[00:21:41] So. I did all the sales. She did all the onboarding, and we kept the team very small and we just signed up customers. And the problem we're solving is actually, was it an acute problem? So after Greenhouse, we sold a couple of other companies and one of them was Square, the payment company, which is quite amazing when you think of it.
[00:22:03] Cause it's a big company growing super fast, relying on the core technology from a team of five. It was five of us back in September. And it was interesting because when we got that deal with Square and a couple of other companies as well we turn cash positive, and from there we kept growing and hiring, but based on our own cash.
Omer: [00:22:22] So it's interesting because I mean, you call this inbound revenue acceleration and you know, if anybody goes to the homepage of Chili Piper, you'll see all kinds of logos, right? Not just Square and Fivestars, but you know, Facebook and Shopify and, you know, the list goes on and on. Now that you've kind of been in this space for a while.
[00:22:52] Why do you think that this problem kind of wasn't really solved before? And how is that this category evolved in the last few years? Like, are you seeing more competitors like what's happening in the landscape here?
Nicolas: [00:23:11] Yeah, it's a really good question. Honestly, when I realized there was a spot room and at works too is only 99 or our CTO to come up with a solution.
[00:23:21] And we started thinking, yes, I should work. It just seemed too good to be true. I think that's impossible. I mean, why hasn't anybody thought of it? So at the same questions you add, as we were building that product, why? Because the problem is real, right? So people lose companies lose more than half there, but yeah.
[00:23:40] And, It took me a while, but, I think there is a reason for it. And the reason is that we sit at the intersection of marketing and sales and they each focus on their own metrics. And that piece that we have is right in the beat in the middle. So marketing is the goal to bring leads. Right. So they do a lot of work and if a form is submitted, then the lead is captured then done their job and sell is about their processes to follow up on the lead. The form is not there. Once the prospect has been submitted, it's pushed to a CRM and they're supposed to follow up and that's the process. So the idea that they would be a bridge in between these two processes is something that nobody was focused on.
[00:24:24] So there was sales tech, helping sales people do their jobs. So for example, distributing these leads assigning them. There's a lot of marketing tech helping these forms, but there was everybody focus on their own path and nobody was focused on the bridge in the middle. So that that's make the nation away people didn't why is this problem wasn't seeing end results.
[00:24:47] And once we not assume that a lot of people copy us, but it hasn't been the case. I think, there's no question that it's a very tricky development. And by now we, we went known we we've done it. So, so we leadership and that before the thing ,we just she's already taken, we'll leave it where it is. I saw the robots.
[00:25:09] We actually, what we actually did on purpose. We went after the very visible logos, because we have this idea of a, we call it the board's eye strategy, which is the idea that. You know word of mouth place huge role these days and you want to go after the most influential companies so that when the next company says, should I do that?
[00:25:28] They're going to look up to that influential company and say they do, I should do it. So very early on with Alina, we, we focused our efforts on sending, companies, like I mentioned Greenhouse, Square, but we also signed a company called Segment the marketing tech, very well known. And we went after all these logos.
[00:25:47] Now, as you've mentioned, we have those who have techies that is on our website. So it's a snowball effect, right? So once you guys look at them, all of those come .
Omer: [00:25:57] Did you get any pushback from some of the larger companies, what you're trying to solve here, there was clearly a pain. And a need for something, but also, you know, if you're running a company like Square, I'm guessing there might be some concerns about, you know, do we want to really sort of have a dependence on this, you know, startup with a handful of people being sort of on the critical path of our, our sales pipeline?
Nicolas: [00:26:24] No, it's amazing. We got pushback from that. We got pushback from other things, but that's when no, it's, it's, it's, it's amazing when we, send some of the other customers, and more people. So we did everything, we have to arise we're a distributed company. We never have in person meetings, but with Zoom calls and then more people on the Zoom call and we had in the entire company very often, but nobody there'll be checked that the pushback we've had is interesting.
[00:26:51] Often sales is reluctant to change their process, which amazes me because they're going to do a lot better. But typically the sales team has invested in sales development reps whose jobs is to put up with these needs, and they're concerned that they could lose their job. Right. I mean, of course what's really happening is they get redeployed, but that's a consult. So we had pushed back on that. So people find all sorts of reasons.
[00:27:16] Wait, what we do is not a good idea, less and less, because now you see everybody's doing it. So you think I'm not going to be the only one continuing losing my pipeline. But at the beginning you also have a reason why their situation is different than they need an SDR team to do it the old way. So that was a big pushback, we kept getting yes at the beginning.
Omer: [00:27:37] Now people who are listening to this might be thinking, well, you know, Nicolas has a great story, serial entrepreneur. He came up with this idea and, you know, Hey, bootstrapping $5 million beyond. And then, you know, yeah, you've been raising money or you're at about $21 million that you've raised sounds great.
[00:27:57] Right. And he says, he's, he's kind of had it really good. But it wasn't always like that. Like, you know, when we were chatting earlier, you told me that, hey, for a long time, you know, people wake up and they check their email, you were checking something else. What was that?
Nicolas: [00:28:12] That's right. Let's see. Chase bank app every morning to check our bank accounts when you was struck the, at risk at any time. So actually, every morning open and see for customer pay, right? Cause we ask every customer to pay upfront and that's how we finance ourselves. So actually the irony that, we became cash positive. We started in January, 2016. We became positive in October, 2016. And in September we ran out of money, but we knew that there were customers in the pipeline.
[00:28:46] So I asked the team, members said, look, we're not going to have money to pay you how much you take stock. And they will say, yes, they'll say, absolutely. We need to, that would pay his September 16 stock. And then of course it was a very good idea because, the stock is not worth a lot of money. Some actually one of them actually cash out that stock from the time and maybe more than half a million on, on the deal. So it worked out, but, but of course it took a phase. So that was September and then October, we had the Square deal, we had a bunch of other deals and the money came in, but it was still never comfortable. It was still, stress every morning to check your bank accounts and see if you're going to make payroll at the end of the month.
[00:29:33] And of course we need to grow. So we hire more people and then a higher payroll liability that we have to meet at the end of the month and we have to actually bring in revenue. And so that bootstrapping for sure is not for the faint of heart. It's a tough process.
Omer: [00:29:50] So it sounds like it was more of a cashflow issue with, with a lot of bootstrappers it's, hey I'm, I'm kind of still trying to find, you know, problem, solution fit or product-market fit.
[00:30:01] For you it sounds like by that time you were pretty confident that you were onto solving a worthwhile problem and you had a pipeline that. At least gave you some confidence that, you know, the money would be coming in. So was this mainly just the cash
Nicolas: [00:30:23] Yeah. Yeah. That's a fair statement because by the time our product was working, you know, and our customers were happy, so there they would renew and extend. It was working in, when we did this inbound solution segment did an AB test and they found that they double their pipeline with us. So it was, it was very, some metrics said some, the measurements with the case study do show that it works. So you're right we had complete faith in our product. We knew the product works and we knew it was a matter of time and a market adoption and managing the cashflow in the meantime. That's exactly right.
Omer: [00:31:01] So I mentioned a little earlier that you've raised about 21 million. You closed at 18 million round a few months ago. I think it was in June and 3 million last year. Why did you not raise money sooner? Why did you decide that you we're going to keep bootstrapping this business despite the, you know, the, the out of money kind of dilemma in sort of the first 9-10 months.
Nicolas: [00:31:33] Yeah. Yeah. So at first I wanted to do bootstrap because with that, it was a good discipline, especially because we sell to sales people. So we want you to very quickly have this experience of, of, closing deals and revenue. We thought it was going to be the right start for the DNA and the company.
[00:31:50] But he wasn't the intention that we would stop for very long time. It was just, we wanted to show that we can get there. So, and then what happened in that, people, a bit like what you were saying earlier, potential investor didn't understand what we were doing. If you'll click, it was just a little Calendly thing.
[00:32:03] And so we received the offers that were never priced at what we expected. Right. Cause we could see what's going to be a big market then. And either there's say, which I think has, Oh, it's a small market we're not interested. Or they would say so that's great. Here's, here's a term sheet. That was way below what we expected.
[00:32:23] So that's what happened. We, you know, if we, if we're not going to get the term that we're looking for, we don't need the money we went to continue and we did, all the way until it became more obvious that we on to the big market that we doing well. And then, and then the, all of you of the business and the external view of the business, starting it. Starting to meet.
Omer: [00:32:45] And then this year, it wasn't that hard to get funding and sort of more favorable term?
Nicolas: [00:32:51] Yeah. This year I'll tell you it's been fascinating. So back in November, we VC discussions and I, I got, again, two term sheets price below what we wanted. So okay, we're not going to take them. It was November 2019, then in March when the Covid happen, everybody freaked out. So we were by then we had a trust investor. We said, we need to raise money to make sure we don't go bankrupt, but nobody was interested in giving your money in March in March all VCs were puzzled. Then didn't know what to do? And closed their checkbooks.
[00:33:32] So instead we never get to waste our time, banging them, it was going to focus on the business and make sure we can operate safely. This is exactly what we did. We just focused on bringing renewing customers and this thing, which customers, we're not going to be able to make it and so on.
[00:33:47] And then something really will happen with that around may, June, the world of software exploded. So the VC studied. First of all that the three months inactive. So they had all this money that he needed to invest. Also, they saw that some software companies were doing really well in spite of the crisis. So that's flipped completely.
[00:34:07] And all of a sudden there was an oversupply of money for tech companies. And that's what we took advantage of when we did this, A round, I'm thrilled with our investor base and, and gradient and the originally there's a flashpoint there. They create teams but we had many other offers. We were completely oversubscribed with other firms, begging us to take that money when just three months before nobody would give us money.
[00:34:32] So it's been very interesting. And now with the IPO's being super successful, like yesterday, and Snowflake, one of our customers, in our $60 million, it's even more so is this supply of money. So obviously. If we were starting now, the conditions would be very different than I think we would go and take money maturely or because the terms that you can get much more favorable.
Omer: [00:35:00] At 2020 has just been the craziest year ever.
Nicolas: [00:35:05] Yeah. But, but you know, it's crazy, but that as far as it works out really well. We're continuing, doubling year, over year, we raised $80 million. We're developing products. So it's odd. Everybody said, I wish I could delete 2020. I don't want to delete it. It got us some money in the bank. Don't delete the $18 million.
Omer: [00:35:31] We need to wrap up in a few minutes, but before we do that, I want to talk about your other company, which you are running in parallel. So tell us a little bit about that.
[00:35:45] Nicolas: [00:35:45] Yeah, so people think I'm crazy, but, and the other company is called Kosmo Time and it's something that I figured I needed. So it's a to-do list with a twist. So we're reinventing a to-do list. A to-do list that is focused on helping you actually do the tasks as opposed to list the tasks shouldn't have been created to do lists because it's
Omer: [00:36:06] A doing list.
Nicolas: [00:36:11] Exactly. And in a way, I tried also to do list, like Todoist, Trello and nothing worked for me. I figure that later in life that have this condition called ADHD, you know, was a very hard time to focus. And when I understood that and said, do you know, I need something to help me in these things don't help me.
[00:36:32] So I just started to solve the problem by starting a company and building the software. And that's exactly what a Kosmo Time is. It's, combined. so the, the, the, there are three core ideas. One is that you combine it with the to do list with your calendar so you can schedule your task and block time in your calendar.
[00:36:49] And there's an additional way to do that is what we call a Sprint. So you can group tasks together that are related so that you don't have to switch contexts. So say you're going to do everything's finance related. You bundle them in a sprint and then you block Friday afternoon and you just execute all these tasks that are related.
[00:37:10] So assuming you mean in this context, switching, the step one is distraction blocking. So we close your tabs, we close your notifications, we close everything, you can stay focused, do your task. And when you finish, we reopen. So I, I completely love it. It's my, it's my secret weapon in being productive, I do have to work extra hours and some people tell me, why do you do that?
[00:37:33] Why not you just focus on Chili Piper? And the truth is that, you know, some people watch foodborne at night, me, I'd rather be working on a tech company than I used to play a lot of tennis so I actually stopped. I said, you know what? If I have a few hours, I'd rather spend on Kosmo Time and figure out what to do with the part of it better. So that's what he said. You do assembly, just go and build that solution is too cool.
Omer: [00:38:00] So how many people do you have working on Kosmo Time?
Nicolas: [00:38:04] Kosmo Time, it's five of us.
Omer: [00:38:06] And how do you balance your time, is this kind of more like a, okay. You know, Chili Piper is my day job. And this is something that I sort of think about evenings or weekends or whatever, or is this sort of just mixed in, and you're sort of jumping from one to the other, depending on the day of the week?
Nicolas: [00:38:24] It's mixed in, but I've long, long days as part of days, like you said 10 or 11 work, most weekends.
[00:38:34] So it's only extended as I say, it's by choice just to enjoy it, it's kind of thing I like to do. So after dinner, I come home with dinner. We have a little boy at home to come to the boy and when he goes to sleep, it, just go back to doing the work and it's mixed in. So I definitely spend more than a full time on Chili Piper. And finally, this whole time focus more time.
Omer: [00:39:00] It's a, it's a really interesting product. And as I told you, I always kind of geek out on to-do lists. I will. And I'll, I'll be sending you lots of feedback. Awesome. Let's wrap up and get on to the lightning round. So I'm going to just ask you seven quickfire questions. Just try to ask them as quickly as you can, ready to go?
Nicolas: [00:39:23] Yeah.
Omer: [00:39:24] What's the best piece of business advice you've ever received?
Nicolas: [00:39:28] Got a piece of advice from my, professor at Stanford Business School, who, which it say, good decisions come from good options. And what you mean by that is if you want to make a decision, make sure you prepare, prepare several alternatives that you can then choose from.
[00:39:43] And that has consistently been a super helpful in, in, in my business career. Good decisions come from good options.
Omer: [00:39:50] What book would you recommend to our audience and why?
Nicolas: [00:39:53] Actually since the audiences around SaaS and entrepreneurs instead of a book I would recommend for everybody to go and read Paul Graham essays on the web is, I don't know, by now you must have 45 different essays that you could compile into a book that should be the Bible of every SaaS entrepreneur.
Omer: [00:40:15] What's one attribute or characteristic in your mind or the successful founder?
Nicolas: [00:40:19] I think for sure, the number one, the thing that matters is market vision. You have got to be able to understand how the market is reacting and where the market is going. Everything else, you know, the hiring, you can make mistakes, but you just don't have the right market vision. You're not going to get product-market fit and you won't have a company. So that's the number one talent.
Omer: [00:40:39] I think I already know the answer to this one, but what's your favorite personal productivity tool or habit?
Nicolas: [00:40:45] Yeah, it's Kosmo Time it changed my life.
Omer: [00:40:48] What's a new or crazy business idea. You'd love to pursue if you had the extra time?
Nicolas: [00:40:52] Yeah. My hands are full. So, with Kosmo time. I haven't had a chance to think of anything else.
Omer: [00:40:59] What's an interesting or fun fact about you that most people don't know?
Nicolas: [00:41:04] I came to the U S everybody assumed that we know. It would be a connoisseur in wine because the French splits, you know, wine and I know very little about wine and didn't have the right talents. So I decided to build my expertise in cognac. So I'm a cognac expert.
Omer: [00:41:23] And finally, what's one of your most important passions outside of your work?
Nicolas: [00:41:28] I'm super interested in understanding how people make decisions. Their behavior. So I read a lot of books around Neuroscience. Neuroscience is in an amazing phase right now where they keep discovering new things.
[00:41:40] There's this professor called Paul Glimcher at New York University, NYU. He has opened seminars. They invite scientists and I love it. So that's a passion of mine to try to understand what's happening in the brain and why we act to a certain way or another.
Omer: [00:42:00] Awesome. I've loved this conversation. I'm really glad I got a chance to sit down with your Nicolas and, and, not just talk about Chili Piper and Kosmo Time, but just your background and your experiences. And it's just such a fascinating story. So thank you for making the time to talk with me today.
Nicolas: [00:42:18] My pleasure. Thank you so much for having me.
Nicolas: [00:42:26] That's right.
Nicolas: [00:42:35] Oh, they can connect on LinkedIn.
Omer: [00:42:37] Okay, great. And we'll include a link in the show notes to that. Nicolas thank you. It's been a pleasure. I wish you all the best.
Nicolas: [00:42:44] Yeah. Thanks a lot. Take care.
Omer: [00:42:46] Cheers.