Cents · B2B · software for laundromats
Walk into laundromats and call them, pitching a no-labor delivery add-on first
Grew to about 80 stores and ~$700K revenue in 2021
What they did
What happened
- Stage
- early
This shipped together with other changes, so the result can't be credited to this alone.
In their words
How Does Laundry Software Make $60M a Year?
Nathan LatkaTake us through uh when you got your first paying customer, and then the growth tactics to get your first 100 customers.
Alex Jekowsky… from a store operation standpoint. They're just the problems that a one-store operator has compounds meaningfully for the large-scale. But we learned a hell of a lot and were able to build a a a a product that maybe a little overbuilt in the beginning, but set the right foundation. I thought this big customer would be enough for us to raise capital. All the feedback I got from from seed investors early on was, "Prove to me you can pound the pavement, and you can sell another five or 10 customers yourself. If you can't do that, I don't understand how you think more capital will get you where you want to be." It was really pounding the pavement to try to figure out the product-market fit. The way I did it was physically walking into stores, or going into the contact form on all their websites, if operators had them, or picking up the phone and calling the the the store. And trying to figure out, if they didn't do delivery, we were building the first ever gig-economy integration for delivery. So, leveraging Uber, DoorDash, uh, etc., to build two-way logistics, which had never done been done in this space before. And we saw that as here, for a nominal fee, you can add ancillary revenue with no labor, CapEx, etc., to launch delivery and grow your the small business owners, you know, addressable market. And that was the wedge to say, "Oh, we also have this hardware product we're building and this point-of-sale, etc." And that is kind of what helped us build up, get about 80 total stores.
Nathan LatkaDo you remember what revenue finished for in 2021?
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More from this episode
- Sign a 73-store operator as your first customer and build with themGot full access to their stores and back office; product a bit overbuilt but solid
- Sell your own payment hardware at a profit, with software and payments attached~$140M a month in payments; 200-250K devices installed; 99% customer retention
- Buy a hardware company when building your own hardware gets too hardRevenue went from $6M to $36M the year of the deal
- Raise at a price investors can 4-6x, and turn down higher offersRaised $140M at 10-20x revenue while profitable; guest says exit options stay open
- Set aside $30M of a funding round to buy shares from employees$30M tender inside a $140M round; employee retention 98%
- Aim for $1M of revenue per employee and keep the team small~$750K revenue per employee, 20%+ EBITDA margin, 98% employee retention
Tags: founder-led-sales, wedge-product, cold-calls, walk-ins, delivery