The SaaS Podcast: Founder Interviews - Page 8

Christian Owens, Paddle

Scaling SaaS by Failing Upmarket First

Christian Owens started building websites when he was 12 years old, walking into local businesses and offering to build them a site. His first customer was an Indian restaurant. By 14, he had convinced software vendors to participate in discounted bundles and generated over $1 million in gross sales from a combined email list of 250,000 subscribers - without having a single subscriber of his own on day one. The pain of running that high-volume software business - handling payments through PayPal, fighting fraud, managing sales tax across dozens of countries - led Christian to found Paddle at 18 years old. He built it to be the product he wished had existed: one platform that handles payments, subscriptions, billing, invoicing, and tax compliance for SaaS companies. The first version of Paddle was actually a software marketplace. It flopped. But customers kept asking for the commerce engine behind it - the checkout, recurring billing, and payments infrastructure. That pivot defined the business and set the stage for scaling SaaS payments across thousands of companies. Scaling SaaS from $10M to $100M in ARR required Paddle to move upmarket. The first attempt failed badly. Christian hired experienced enterprise account executives, pointed them at large logos, and assumed the same value proposition that won $1M customers would work on $50M prospects. Every sales rep quit within six to nine months. The second attempt worked because the team rebuilt ROI messaging, added enterprise product features like 2FA and audit logs, and learned to articulate value at the buyer's current scale instead of the scale they were at when they first signed up. Today Paddle employs nearly 400 people, has raised $300 million in venture capital at a $1.4 billion valuation, and counts Verizon, Fortinet, and ServiceNow among its enterprise customers. Christian also led the acquisition of ProfitWell for $200 million, combining Paddle's payments infrastructure with ProfitWell's retention and metrics tools - a deal that reflects the compounding effect of scaling SaaS by solving adjacent problems under one roof.

Zak Holdsworth, Hint Health

From 80 Doctors to 1,000 Customers in Vertical SaaS

Zak Holdsworth is the co-founder and CEO of Hint Health, a membership management, billing, and payment platform for direct primary care practices. In 2014, Zak and his co-founder Graham set out to transform the US healthcare system. They were frustrated with a system that spends a trillion dollars a year in waste - roughly NASA's entire budget since inception - while delivering half the quality of other modern economies. They decided to build vertical SaaS for a community of doctors stepping outside the insurance system to offer care directly to patients and employers. The problem: this niche had roughly 80 doctors in it. Despite zero healthcare experience, Zak and Graham moved fast. Within 30 days of committing to the idea, they attended their first industry conference, started cold calling, began building a product, and closed their first paying customer. A few months later, they had their first 10 customers. But speed came with a cost. Zak says if he could go back, he would spend more time researching customer problems before building. By moving too fast, they accumulated product debt that set them back an estimated two years. The bigger challenge was trust. These doctors depended on their billing system to make payroll. If Hint failed, their practices would shut down. Zak overcame this by personally guaranteeing to cover any missed payments out of his own pocket - putting roughly $20,000 on the line for a single customer. From there, Hint Health grew through community events, partner referrals, and word of mouth. Zak launched an annual industry conference that grew from 120 attendees to over 450. He built integrations with complementary vertical SaaS vendors and created a free accelerator program for customers. Today, Hint Health has nearly 1,000 customers representing 750,000 lives, processes over half a billion dollars in payments, and has raised $64 million across four rounds. But the path was far from typical - Zak pitched over 1,000 investors because venture capital firms struggled with the small total addressable market of a vertical SaaS business in a niche healthcare segment.