Upsales: Bootstrapping a B2B SaaS to $13 Million ARR
Daniel Wikberg is the founder and CEO of Upsales, a CRM solution that helps B2B sales teams to uncover new opportunities and secure more deals.
In 2001, when he was 20 years old, Daniel decided to take a sabbatical year before going to university. During that year, he worked as a sales rep and quickly realized that there was a lack of user-friendly software for salespeople.
Since he knew how to code, Daniel quickly built a simple customer database and to-do list. Even though he was a bit embarrassed about the software, he got it in front of a prospective customer and managed to close his first sale.
That's when Daniel had a lightbulb moment and decided to ditch his university plans and launch Upsales instead.
Fast forward to today, Upsales has become a 70-person team, pulling in around $13M in ARR with 1,800 customers, all while being bootstrapped.
In this episode, you will learn:
- The outbound sales strategy Daniel and his team used to drive the majority of their growth and close large deals.
- How Upsales simplified the decision-making process during trials and went the extra mile to provide more value which helped increase conversions.
- How Daniel and his team used a ‘land and expand' sales approach to further accelerate their growth and simplify decision-making for customers.
- The challenges and lessons Daniel learned from competing in a market with some very established and well-funded companies.
I hope you enjoy it.
TranscriptClick to view transcript
This is a machine-generated transcript.
[00:00:00] Omer: Welcome to another episode of The SaaS Podcast. I'm your host, Omer Khan, and this is a 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 talk to Daniel Wikberg, the founder and CEO of Upsales, a CRM solution that helps B2B sales teams to uncover new opportunities and secure more deals.
In 2001, when he was 20 years old, Daniel decided to take a sabbatical year before going to university. During that year, he worked as a sales rep and quickly realized that there was a lack of user-friendly software for sales. Since he knew how to code, Daniel quickly built a simple customer database and to-do list, even though he was a bit embarrassed about the software.
He got it in front of a prospective customer and managed to close his first sale, and that's when Daniel had a light bulb moment and decided to ditch his university plans and launch Upsales instead. Fast forward to today, Upsales has become a 70-person. Pulling in around $13 million in ARR with around 1800 customers all while being bootstrapped.
In this episode, you'll learn about the outbound sales strategy. Daniel and his team used to drive the majority of their growth and close large deals. How Upsales simplified the decision-making process during trials and went the extra mile to provide more value, which helped them significantly increase conversions.
How Daniel and his team used a land and expand sales approach to further accelerate their growth and simplify decision-making for customers and the challenges and lessons Daniel's learned from competing in a market with some very established and well-funded companies. So, I hope you enjoy it. Daniel, welcome to the show.
[00:02:04] Daniel: Thanks a lot. Good to be here.
[00:02:05] Omer: Do you have a favorite quote, something that inspires or motivates you that you can share?
[00:02:10] Daniel: I think Ted Turner once said when asked what would you have done differently in your career? And I think he said something like, I should have hire slower and fire faster.
[00:02:20] Omer: And yeah, I agree with that.
So tell us about Upsales. What does the product do? Who's it for and what's the main problem that you're helping to solve?
[00:02:28] Daniel: So, we're a citizen marketing tool. So, we are a CRM and a marketing automation provider. And we try to help like mid-size B2B companies to, to grow revenue.
And we focus on a couple of key areas of the sales process where we believe that the industry in general ha has done a poor job of solving these specific problems. So we try to solve them for a specific niche of the market, basically.
[00:02:51] Omer: Okay, great. So, I want to talk about kind of how you came up with the idea for this business. You founded this company in 2001. Before we do that, what were you doing before you founded Upsales and how did you come up with the idea for this business?
[00:03:08] Daniel: Yes. I was 20-year-old when I founded Upsales, so I didn't have, that much of a background to talk about. I always been into, programming. I've been doing programming since I was 13 years old. And then when I finished high school, the plan was to go to the university and study some kind of engineering. But I decided to take a sabbatical year and ended up in a sales job.
And I realized that like sales and selling is like this huge industry which you never hear about. You don't talk about being a salesman as a future career when you're a teenager. I started doing that and I realized that the the tools that you were using especially back then we're not they were not so user friendly, and they didn't get into a good job in helping.
Non-technical, like salespeople to, to do their job. So that was where I got the idea to, there must be a way to, to do this better. And I actually just stumbled upon I was talking to a customer in the sales job I had. And I talked to them about to what kind of system are you using?
And they didn't have any. That was the first customer. So, I just spent a couple of days in my apartment building something and yeah. We grew customer by customer after that, basically. And I never went, I, I postponed indefinitely. My plans for getting a degree in anything.
[00:04:21] Omer: Your background BA was basically programming computer science and your sales experiments was what, about a year or so of working as a sales rep before you founded Upsales?
[00:04:33] Daniel: Yeah, I think two years. I had two jobs and. I had the kind of, I had the luck of ending up in a place where they had this super enthusiastic and professional sales coaches.
So those guys sparked my interest in, in, in selling as a profession. So yeah, I think that was a big part of it.
[00:04:51] Omer: Tell me about the first version of the product that you built. Like, how long did it take you and what did it do and what was, what were some of the things that you were embarrassed?
[00:04:59] Daniel: Yeah, I think I was embarrassed about pretty much everything. The first version was like a super simple, it was a super simple customer database and a to-do list basically. So, the first customer was a media company, and they had five sales reps, doing a hundred calls a day to trying to close business.
So, they, they just used this first version. Keep track of all the calls and all the customers. I think I spent 120 hours building the first product. So, it was like very basic.
[00:05:28] Omer: And did you build it with just this one customer in mind? Or while you were building it, you were talking to other customers as part of your job trying to gather more research and insights?
[00:05:39] Daniel: I think the first customer I didn't really think of it as a business. It was more like, an experiment in a way yeah, I just figured, this is something I would use if I were, I was also doing calls every day in my sales job. Sales is a generic activity.
And then after that I find I found actually customer number two came by word of mouth from customer number one. So that was also a media company. And then everything evolved from that.
[00:06:04] Omer: 2001. So, you've been running that as a business for over 20 years. Can you give us a sense of the size of where you are right now in terms of revenue, number of customers, size of team?
[00:06:16] Daniel: Yeah. We're a team of 70 people. We're serving 1800 customers. And our customer base is distorted. I usually say that we have 900 customers and then we have 900, like very long tail customer. Which we inherited from a former partnership with a white label partner. 900 like focus customers generating around $13 million 13 to $14 million in in ARR.
[00:06:38] Omer: How much money have you raised? Because there was some confusion about this and I came in and said, Hey Daniel, you've raised this much. And you were like, nope. Yeah,
[00:06:45] Daniel: I know. That's the problem. We're a Swedish company and all of the data and all of these cool international databases are almost always incorrect.
So, we've been bootstrapped from the start to today we are a public enlisted company. We did a small cap raise when we did the IPO but never used that. Money was used to pay off a loan that we had taken up a few years back. So yeah, we've been a bootstrap company growing organically from the start, bootstrapped to $13 million in ARR.
[00:07:14] Omer: That's a nice accomplishment and especially in the market that you compete in with some pretty big players, right? So, who, who are like the top two or three competitors that you have to deal with every day?
[00:07:28] Daniel: I, I think looking at our market, if you do a Google search for a CRM, you get like a thousand.
And a lot of these are great tools. If you're like a five-man team or a really small company and then you have Salesforce and all of the bigger players, which are great if you're a Fortune 500 business and you have an IT department and a huge budget. But if you are like a growing mid-sized company, like with a hundred to up to a thousand employees we believe there's a gap in the market.
So this is the part of the market where we have our focus and I mean our main competition comes from Salesforce and HubSpot. So I think that's something we're very proud of. I We're a small team. Salesforce, I don't know, 30, 40,000 employees and HubSpot is also like a huge company.
A big part of our success has been to try to figure out which are the specific industries and types of companies. Where we feel that we can do something different and bring something unique to the table. And that's, yeah, that, that's the way we've always done it. And that's the way we try to do it today as well.
[00:08:25] Omer: Okay. So that first customer that you got the product in front of, did you charge them?
[00:08:31] Daniel: Yeah, absolutely. I think they paid they bought like one user 50 bucks a month. And the fun thing was that back then the server wa was actually a computer in my apartment and the guy working there the user was a sales rep.
He, he was calling customers in a different market. So he always started like early in the morning because of the time zone. And, downtime happened like almost every week because they had to reboot the computer running the software. So he realized after a couple of times, usually calling me or, calling the number to Upsales and literally waking me.
And after a while, he realized that this is not a company, this is just some dude I'm calling. So yeah, I, I still know that guy actually.
[00:09:11] Omer: That's brilliant. All right, so how long did it take you to get to the first 10 customers? So you said that, Hey, this was an experiment and I didn't really think of it as a business at that time, but once you got this customer on board, maybe got over some of those initial issues, at what point did it become a business in your mind, and how long did it take for you to get those first 10 paying customers?
[00:09:35] Daniel: Yeah, so what we did, we, we had this first customer and then rather quickly the second one. And then I realized that, okay, this is just some, super simple project I hack together in, in a hundred hours.
So I need to build something more, more robust if I'm going to sell it to, to more companies. So I brought on my co-founder and. I think we spent four or five months, like building, like version two. And then we started selling that. And I think in the first, yeah, I remember the first five months we started in August after the summer so August to Christmas.
I closed five customers and I think I met with 110 or 120 or something. So like the win rate was horrible. And I remember the mental pressure of 19 outta 20 people I meet is not interested in what I have to say. So that was very tough. But then a, after those initial, those first five months, something happened we, I don't remember exactly what was the main difference, but we went from closing one in 20 to maybe closing one in seven or one in eight out of the customers we met.
So, I think. Maybe in total seven to eight months to, to get to customer number 10.
[00:10:46] Omer: You said you didn't know what changed. Do you think it was just, you were just getting better at selling the product?
[00:10:53] Daniel: Yeah, I think so. I had a friend who's like very, everybody knows that guy who's like brutally honest when he gives you feedback.
So, I, I had that friend and he actually joined me on a few sales meetings, and he gave me some very harsh. So, I think that was one of the key aspects. Yeah, and I think one of the key things was like in the beginning you want to talk to anybody who wants to talk to you.
But I think it's super important to, early on, be selective in because you have 24 hours every day that's you have the same currency as anybody else. And it's important to be wise about where to spend that.
[00:11:26] Omer: Yeah, everybody needs one of those friends who are harsh with the truth, because I was talking to a founder a couple of days ago and she was talking to customers and trying to get feedback and everybody was being so nice and saying, yeah, I love the product.
And she is I know there's something there. They're not telling me like, so you know, you need to find that friend. Yeah. All right, so we got the first 10 customers. In terms of getting like the next say, let's say first 100 customers, did things change much or was it more about. You guys just continuing to do the same, going out there, making the product better, getting better at selling did you do anything different to get to those first 100 customers?
[00:12:07] Daniel: I don't think so. I think o obviously a lot of things happen. Like a thousand things, but. I think all in all was just about, keep at it, keep calling customers, booking appointments, meeting them and try to figure out along the way okay, where do we get success and where we are having no, where don't we get success?
I remember another like breakthrough moment. I read this book. We had this problem with the selling cycles were really long and the deals were really small. So, to me, it didn't make sense that all of these deals dragged on forever. So, I started googling about, okay, I need to find some information or inspiration about how to shorten sales cycles.
And I stumble upon this book called Getting to Closed by a guy called Steve Schiffman. And that I think it doubled my effectivity because it gave me this mindset about, being brutally honest with all of your customers and not just pleasing them. And make sure to spend time with the right kind of, kind of customers. Basically. So, I think that was an accelerator actually. I haven't heard of that book before. It's amazing. It's, it's like 25 years old, but it. It's the best book still. I've read like several hundred sales books, but I think this one is the best when it comes to how to work effectively with your pipeline.
It's really good.
[00:13:24] Omer: Do you remember when you hit your first million in ARR?
[00:13:28] Daniel: Our first million was in 2000 and. So yeah, like five years.
[00:13:33] Omer: So, 2006, the business is still bootstrapped, you hit the million era. When you founded up sales, I think Salesforce was still in the early days, right?
They had been noodling around with their product. HubSpot didn't even exist. I think HubSpot was gonna happen later. I wanna figure out this kind of competitive landscape. You talked about, hey, this is where we think. described that market in terms of these are the companies that we think are underserved where we think this opportunity exists for us to provide value.
How did that change once products like Hubspot and Salesforce became more mainstream? Did you find yourself that having to spend more time with customers trying to explain where Upsales fits in and how it's different or better, or do you feel like you'd already. The last sort of five years of building and selling the product, you'd already started to get some clarity around the sweet spot for where Upsales fitted in and you’re positioning.
[00:14:33] Daniel: In a way we're still trying to figure that out, to be honest. It, it changes all the time, or it, at least it evolves in the early days. Just talking about the basic stuff in a CRM was enough to convince a lot of customers. And the market was like very immature, I think, in a way is still very immature, but as we have grown as a company, we've looked at, okay, which are the integrations we can do?
Like what's the data we can add to Upsales that no other provider has that, that, that gives on us an edge. That has been one like very important thing. And I think also, when I talk to people in our sales team and to other entrepreneurs, especially early-stage entrepreneurs, I think that don't think so much about the competition because it's an illusion that, that all customers know about all providers.
Most prospects you meet, hear about your product or your product category for the first time. So, I think that's That's important to to go out there and just talk to the customer, understand the problems and, solve them in a better way than anybody else.
And don't worry so much about the competition. I think a lot of companies may make competition too big of an issue first.
[00:15:45] Omer: First of all, I think that's a great point. I think there's this danger with many founders to spend too much. Looking at competitors and while having some awareness is a healthy thing to do, so at least you figure out where you fit in, how you differentiate, all that stuff.
It can become problematic if you're spending too much time or obsessing too much over it. I wanna talk about you went from like zero to, 1800. Customers that you have today, what was the main growth driver like? The, what was the kind of the main marketing or sales channel that you were acquiring these customers through?
[00:16:22] Daniel: We have been we have had a very deliberate outbound strategy. We do a lot of marketing, and we get quite a few leads every week. We get a decent number of customers from word of mouth and referrals from happy customers as well. You can look at it in two ways. If you look at it in terms of number of new customers, we bring in.
I think that inbound or word of mouth are probably like the biggest sources. But if you look at revenue like outbound is probably 80 or 90. And I believe that's the case in, in, in most sales companies. For us, looking at the target list we have of the ICPs where we're going after, it's a pretty small list.
It's like 1500 named accounts. And these are the accounts targeting one client from that list is the equivalent of 20 customers coming from inbound channels. I think a lot of a lot of sales companies and also companies in other industries have this kind of, this fantasy about how nice would it be if just the customers just came to us.
And I think succeeding with inbound for larger deals or deals that move the needle, I think it's very difficult and I see very few companies doing that successfully.
[00:17:31] Omer: So, you said you, you're targeting around 1500. Companies, you have 1800 customers today. I know you talked about the 900 that maybe fit that category. So, is that 900 part of the 1500?
[00:17:44] Daniel: No, we have a long tail. We work with any customer who wants to work with us, where we believe we can provide value. So, we get a lot of customers every month that, that finds us online and finds us through marketing. Looking at this focused list of like highly high-value accounts.
I think we may have sold to, I don't know, five or 10% of them now. So, it's still a long way to go. A long runway.
[00:18:10] Omer: Yeah. So, tell me about the sales process. Not today. We can maybe compare that to how you do it today, but when you first identified this, I. And you said, okay, we're gonna go out and we're gonna go do outbound and we're gonna try and land some of these deals.
What did that outbound process look like? And typically, like how long was the sales cycle like for you to get from like first touch to closing this type of deal?
[00:18:36] Daniel: So that, that's always also evolved throughout the years. And I think that what always worked best for. Has been to go out there, talk to the customer and try to get some initial understanding of their situation and then move straight from that to provide value.
Instead of doing hypothetical demos and stuff like that. I think that we always try to set up a trial account to get the customer's data into their account so they, they see the actual. Basically, we onboard them as if they would've been a paying customer. I think that has always been the most effective way.
That's not always possible depending on what product you're selling, but for us, that has always been the fastest way to, to win the deal. And it's funny because this was basically what we were doing in the beginning because, as a bootstrapped company, you literally have a gun to your head and you need to close business to, be ordered to pay the rent and buy lunch basically.
So, anybody who wanted to work with us, we would do whatever they needed. So, we did all these crazy customizations and all of these crazy stuff in the beginning, and then we moved to this more kind of, professional selling process. If you. And then lately the last two or three years, we went back to the, the initial way we used to work with customers just skip all the sales stuff and just show them the value because the that's what matters for the customer.
[00:19:57] Omer: Give me an example of when you mean skip the sales stuff and show them value. So, I think the, what you just described there in terms of saying, hey, we get their data in, even if they're just a trial. And depending on the type of customer and the data they have, I assume could get quiet, become quite a significant piece of work for your team to, to do that.
But I can see the value in it because you give somebody access to an account and there's no data in there.
[00:20:26] Daniel: Exactly.
[00:20:26] Omer: And they're thinking to themselves, okay, I can play around with this, but I don't really know how this is gonna work. And the effort required to take all my data and put it into here for a trial, I'm not gonna waste time doing that.
And so there's this risk that this trial never goes anywhere. And so I think it's super smart to say no. We know this is a hurdle for potential customers and so we're gonna get past that and make it easier for them. So I think that's a great solid example. But what do you mean by like skip the sales stuff and do that. So what were some of the things that you were doing less of?
[00:21:03] Daniel: Most sales calls and sales meetings? You talk about like hypothetical stuff you have a demo account with fake data and you're sitting there discussing the Yeah, you don't really get to the real stuff.
So I, I think the typical software selling process, you have, this workshop and you're sitting there talking about all of the stuff. But it's always like that, that when you actually start to, to log into the account and to try to figure out exactly what the customer needs to do, that's when you got get all the answers.
So, I think. This builds a lot of trust. And when you sit in this hypothetical workshop discussion the customer is always thinking, okay, this sounds really good in theory, but I don't really know if it will work in reality. And we all that's also one of the reasons why we spend so much time building integrations to, to like the most common. Like other tools that, that our target market is using to accelerate the way to get the data in.
[00:21:56] Omer: How are you qualifying people before you were going and doing this work? Like you, you could have somebody who looks like they're interested in it, and you spend a whole bunch of time getting their data into the product and then they never use it or try it out versus someone.
Who is a lot more engaged, actively using the product, maybe giving you feedback and is far more likely to become a paying customer. What were some of the things that you were doing to qualify and to figure out which bucket somebody kind of fell into?
[00:22:32] Daniel: I think that's the beauty of doing it this way because engaging in, in the trial, in the way that, that you have to do to get value as a customer.
You don't spend that time if you're not interested. So, I, I think that sell the process of doing that kind of qualifies the customer. It's part of the qualification I would say. And obviously it's super important to make sure that. You're not talking to some guy in the organization, in the customer's organization who just, has a little bit, a little too much of free time on his schedule.
We try to always include the CEO or at least somebody reporting to the CEO to know that we're talking about something real.
[00:23:11] Omer: You were basically any prospect that you're talking to, y you were by default on you. Onboarding there or moving over their data into the trial product. Wow.
[00:23:20] Daniel: So, we had actually, we had a funny fun example. I think this was customer number five. They were like very old school. No, the opposite of tech savvy. And when we were planning to do the implementation and we were talking about, yeah, we need to get your data into Upsales they actually literally went to get a physical, like a moving.
With binders like, yeah, these are our customer records, can you help us? Yeah, they actually had to do that themselves. But you get to see all kinds of examples.
[00:23:50] Omer: Do you know at one point you, we you changed your sales approach, and you went more towards a land and expand type approach. What was the thinking behind. Why did you make the shift and how did that work out?
[00:24:04] Daniel: We used to have these bundled the, this product bundles which a lot of SaaS companies have with, like a gold, a silver, and a bronze package. And we realized two things that these bundles created a lot of frustration for existing customers.
They wanted one feature from the gold package, but they didn't want their bill to, to grow by 300. That was one thing. And the other thing was that when we looked at our top 20 accounts who were paying us like north of $50,000 per year most of them started paying four or $5,000 per year.
So, it made sense to lower the threshold to, to make the initial decision as straightforward as possible for new customers. And then we move to this pricing model where we have a license, like a price per. And then all of the other stuff, we, we turned into add-ons, which made it a lot easier for the expansion sales team.
We used to be like, you could sell more seats, or you could sell an upgrade. And that changed to, you could sell seats, or you could sell like, a variety of 15 to 20 different add-ons. So, it, it really helped accelerate the growth on existing accounts.
[00:25:10] Omer: Okay. Great. So existing accounts, it worked. How did it work out with lending new business?
[00:25:14] Daniel: Yeah. That, that also improved because we, we talked a lot about internally that don't worry so much about the initial contract value. Just get the customer on board. Just sign them and make the initial decision as straightforward as possible.
And I think. There's a great benefit for the customer as well, because when you start to use any software, you can spend, a hundred hours in a workshop trying to figure out exactly what you need. But when you start using it, that's when you realize all of the details. So, I think doing it this way, like simplifying the initial scope, if you will, reduces the risk for the customers. So, it's great for us and it's great for the customers.
[00:25:56] Omer: Let's talk a little bit about hiring. So, you said the team is about 70 people today, right? Be, before we start recording, you were telling me about some of the challenges of, balancing, like not having junior people or senior people. Just tell me about the, some of the challenges that you faced.
[00:26:17] Daniel: I can attribute like a hundred percent of the success of the business, like having the right team. It's a cliche, but it's so true. And I, when you're a, when you're a super small, when you're a startup, you need to get a lot of stuff done and the roles are never like, clearly defined. And if you're a five-man team or a 10 man team, like everybody literally has three roles. So, I think that's a challenge because you need some outside perspectives. And you need to, you need like smart people with experience. But most smart people with experience come from like way larger companies.
And most of them are struggling to adapt to this kind of chaotic environment of a startup. So that's a challenge, like finding smart people who can really contribute and move the needle but also have the kind of, roll up your sleeves and just get your hands dirty.
That's a combination. It's rare to, to it's hard to find. We've had great success of hiring, a lot of people early in their career a lot of newly grads and like training them. And it's a model that works, but it doesn't scale forever. And after a while you get to a point where, okay, now the team is growing.
We need to promote somebody to a manager, and we need to, have all these kinds of specialized. And it's always easier to promote somebody from within, but if nobody inside of the company has like any experience except from being at upsells, then you end up in a tricky place.
So, I think that balance is it's a very difficult balance. And now when we are hiring, we are trying to like the same way we have a very. Defined list of companies we wanna sell to. We try to define these are the companies we want to hire from. So, try to identify which are the companies out there who have a similar culture similar size, like similar selling process and so on.
That's one way of solving that.
[00:28:12] Omer: What was the worst hiring mistake you made? What did you learn from that experience?
[00:28:16] Daniel: I remember one time a few years ago, we actually hired three people almost at the same time, who were like super senior. Two of them were part of the management team.
And these were like really smart people. And every month when we have a town hall meeting every month, going through the KPIs and all of the stuff that's happening. And, boy, they had impressive PowerPoint slides. A couple of months go by, and you realize that none of them is doing anything.
So, I think that was don't get impressed by, people's jargon or slides or resume or background. And I think one learning from that was. When you hire some somebody senior for the first time, don't just let them go. Make sure to like, have clear expectations like weekly check-ins and milestones.
And you can't manage them in the same way you manage a newly grad, but you can't just let them go either. So, I think that was the mistake I did. It took me too long to realize that these guys are, they aren't doing anything. And I paid them a fortune.
[00:29:19] Omer: I think it goes back to hiring the right person for the right type of company. And if you're bringing in somebody senior who's working a, maybe a much bigger company. Maybe some of those PowerPoint slides are the expectation, right? Because they're delegating a lot of stuff out. And the other thing I wanted to ask you about was this IPO that you mentioned.
Typically, when I look at a company and think of IPOs, it's usually, yeah, they hit a hundred million in ARR or something like that. So, for you at around your 30 million A RR I dunno exactly when you did the IPO.
[00:29:55] Daniel: 2019, so four years ago.
[00:29:56] Omer: Got it. So, it seemed early. Is this something specific to like Sweden, or do I just not know what I'm talking about when it comes to IPOs?
[00:30:06] Daniel: No, but it, it's a good point. I think that Sweden actually has a culture of a very large part of the population or have a stock. So, you have this culture of buying stocks.
Even if you have like only a thousand dollars you probably have some kind of stock account and you trade stocks. So, this has enabled you to have actually a couple of them, like smaller lists. So, Nasdaq who operates the Stockholm Stock Exchange.
They have a smaller list called First North where we are listed. And I this has enabled like very small companies to go public. I think a lot of companies do it too early. When we did it, we were at like 6 million in revenue and we were profitable. We were doing like 20% EBITA or something like that.
So at least we had some kind of stability and a business that had some predictability. The story behind it was that, I had, I think I had like 74% ownership when we did the IPO. So, I wanted to sell like a small part of my ownership, and I had a partner who wanted to exit, who had 10% as well.
And then we had a loan I mentioned. So, we, we took on I think we did a share issue of two and a half million dollars was like a small issue. And the pre-IPO, which we did. To get some, more institutions and more, more famous people in the share list of shareholders.
That, that was actually a pure secondary, so me and my partner sell selling existing shares. So, I think if you add those together, I think it actually becomes the number in Crunch Space. But two-thirds of that were never, like capital raised to the company was just me and my partner selling shares.
[00:31:39] Omer: There are obvious benefits to doing an IPO. But as as a bootstrapped founder where, you know you are running the show, you don't get too much interference. There are no investors to tell you what to do or grow faster at any cost and that kind of stuff. What has been some of the challenges of now running a public company?
[00:32:01] Daniel: I think a lot of people like overcomplicate. You have this view of once you go public, you have this monster of administration and all of the, all the stuff you need to do. We have one person in finance and then we have an outsourced partner helping us with the day-to-day.
But we have a highly automated way of running our finance team. I have a few friends who've taken their companies public and some of them have had like very poor experiences from doing that. So, I try to learn from their mistakes and. I think I wanted to sell some of my shares and my partner wanted to exit.
And I wanted to continue to be the majority shareholder and to maintain the control of Upsales and run it the way I want to. I wouldn't have been able to do that by, the other option would've been to sell like a minor minority stake to a private equity firm or something like, I think that would have been more of a hassle actually, to handle, compared to, to taking the company public. If you do it the right way, it's not that bad actually.
[00:33:00] Omer: Yeah. It's, it sounds very I thought, you had a huge finance department and a whole bunch of overhead now that you had to deal with and things. You have, requirements that you have to meet in terms of, how the, how you're running the business, but There you go. You learn something new every day.
[00:33:15] Daniel: Yeah, and I think that the majority the kind of the trap that I think a lot of companies fall into is that when you go into that space, you start meeting all these bankers and advisors and investors, these are smart people and all of them have like very strong opinions about what you should do once you're a listed.
Almost all of them are wrong. That, that, that was that was tricky in the beginning to navigate okay, who should we listen to? So, I actually found a couple of mentors, like entrepreneurs who have, taken their business public and had it public for many years and grown it into to larger companies.
And the advice you get from people like that are. Almost always exactly the opposite of what you get off from this smart experts in in expensive suits.
[00:34:02] Omer: All right, we should wrap up. So, I'm gonna get onto the lightning round. I've got seven quick fire questions for you, so just try to answer 'em as quickly as you can.
[00:34:10] Daniel: Let's do it.
[00:34:11] Omer: What's one of the best pieces of business advice you've received?
[00:34:14] Daniel: Trust your gut.
[00:34:16] Omer: What book would you recommend to our audience and why? You can say the same book again if you like.
[00:34:22] Daniel: Yeah, the book I mentioned is great, but I love, it's behind me here. It's a hard thing About Hard Things by Ben Horwitz. I've got a ton of good advice from that one.
[00:34:29] Omer: What's one attribute or characteristic in your mind of a successful founder?
[00:34:34] Daniel: Stamina.
[00:34:35] Omer: What's your favorite personal productivity tool or habit?
[00:34:38] Daniel: Getting things done.
[00:34:39] Omer: What's a new or crazy business idea you'd love to pursue if you had the extra time?
[00:34:43] Daniel: I don't know, something in related to energy maybe.
[00:34:46] Omer: What's an interesting or fun fact about you that most people don't know?
[00:34:50] Daniel: I actually once was planning to compete in power lifting, and I was planned to be on a national competition, actually when I was like 35 years old.
[00:34:58] Omer: Wow.
[00:34:59] Daniel: Yeah, it's, and then I broke my back.
[00:35:02] Omer: Sorry to hear that. And finally, what's one of your most important passions outside of your work?
[00:35:06] Daniel: Skiing.
[00:35:08] Omer: Sweet. All right. If people wanna find out more about Upsales, they can go to upsales.com. If folks wanna get in touch with you, what's the best way for them to do that?
[00:35:17] Daniel: Daniel[at]upsales[dot]com.
[00:35:19] Omer: Beautiful. Daniel, thank you so much for making the time to chat, for sharing your story. Always love talking to founders who bootstrapped and their SaaS business and grow beyond 10 million ARR. So, congratulations on that. And I wish you and the, the best of success.
[00:35:39] Daniel: Thanks a lot. Thanks for having me.
[00:35:40] Omer: My pleasure. All the best. Cheers.
- “The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers” by Ben Horowitz