Our journey from $200 to $20k MRR in 16 months
We were considering for a long time to share our internal KPIs (especially MRR) publicly and we came to the conclusion to do it for the following two reasons:
It’s really hard as an early stage startup to tell if you are on a good track or not. On the one hand the internet is full with vanity metrics bullshit, on the other hand there are not that many companies sharing their numbers or revenue openly. Therefore it’s really hard to see if you are doing well or not, because there’s hardly any real data you can compare yourself to. I’m hoping to motivate other startups to be more transparent.
The messaging and bots space is still in a very early stage and many people doubt that you can make money in this space. I’m a big believer in this space and therefore would love to show that it’s possible to make at least some money (even though it’s not a fortune 😉).
Before sharing our numbers, I want to talk a bit about our background: We started looking into the messaging space in early 2015. Back then me and my co-founder Bernhard still had a full-time job, nevertheless we started building a small prototype in our spare time to send out and schedule broadcast messages via messengers to an audience (basically Buffer for messengers). Even though we had some initial traction we decided not to move forward with this specific idea (for several reasons), but we still believed that messengers are becoming a big market for business to consumer communication.
So we quit our jobs and dedicated all our resources into building a messenger based customer communication platform oratio. We released an MVP in October 2015 and convinced a handful of early customers to pay for our service which brought us ~$200/month. Over the next couple of months we improved our product and released our first production version in February 2016. These are our numbers by May 2017:
From my experience, the earlier stage you are in the more volatile is your MRR growth. If you have just a couple hundreds of dollars MRR, onboarding a bigger client makes a big difference, so does losing one of them. For now we decided to focus on SMBs.
We experimented a lot on how to acquire customers, how to activate and convert them and finally how to keep them on our platform. These experiments can lead to unexpected growth, but also to unexpected stagnation.
👥 Paying teams
Our MRR is not bound to the number of teams using our platform, since we charge for usage. Bigger teams with higher usage have a higher share to our MRR than small teams with little usage. Nevertheless paying teams are a very important factor for us — the more different companies we have using our platform, the less risk it is for us if one company decides to cancel their subscription.
This is definitely our most important KPI because it shows us the actual usage of our product. Even though we had some outliers on our other KPIs, we are very happy to see a significant and steady growth on messages sent and received by our users and their customers. Needless to say we are more than happy that we recently passed the 10 million messages mark.
We will continue to share our metrics on a regular basic. If you are interested in our journey, sign up to our newsletter The Messenger.