EP 547: Handshake.com Raises $24M, Helping 1000+ Customers Manage Store Product Purchasing with CEO Glen Coates

Glen Coates. He’s the co-founder and CEO of Handshake. It focuses on putting the right product on every shelf in every store. He goes between Sydney, San Diego and New York City.

Famous Five:

• Favorite Book? – The Five Dysfunctions of a Team
• What CEO do you follow? – Dave Yarnold
• Favorite online tool? — Boomerang for Gmail
• Do you get 8 hours of sleep?— Yes
• If you could let your 20-year old self, know one thing, what would it be? – Glen wished he knew how intense running this company was going to be and to spend a lot more time making music and going surfing.

 

Time Stamped Show Notes:

• 01:37 – Nathan introduces Glen to the show
• 02:15 – Handshake is about getting the right product on every shelf, in the world
• • 03:30 – Handshake brings the Amazon-like buying and selling platform to businesses
  • 03:55 – Handshake Rep is the mobile app used by sales reps who work for the brand
  • 04:21 – Handshake Direct is the mobile and web-based ecommerce for B2B
• 05:00 – Handshake is a SaaS business and they sell to manufacturers and distributors
• 05:10 – Handshake’s customers are the manufacturers, distributors, and their customers who log into Handshake
• 05:22 – Handshake has a similar model to Salesforce
• 05:40 – Glen started working with Handshake in 2010 and got their first customer in 2011
• 05:51 – First year revenue
• 06:16 – Average number of customers at the moment
• 06:51 – The pricing model is per seat per year for Handshake Rep, Handshake Direct is made-to-order
• 07:37 – Average customer pay per month
• 08:24 – December 2016: total average revenue range
• 09:35 – Handshake used to have monthly contracts
• • 09:59 – Most of the contracts now are annual contracts
• 10:07 – Total capital raised is around $24M inclusive of Series B
• • 10:29 – Series B closed in February 2016
• 10:40 – Handshake isn’t in any acquisition talk
• 12:03 – What Glen and his team is building is grand in scale and requires a lot of hard work
• 12:44 – Team size and location
• • 13:05 – Glen shares the number of people per team
• 14:10 – LTV
• • 14:15 – “I don’t think much about lifetime value”
  • 16:51 – “I care about delivering 100% growth with a better payback period than I care about delivering 200% growth with like a terrible payback period”
  • 17:05 – Handshake growth is 100% annual
• 17:30 – Glen shares the flagged payback period in VC communities
• 18:48 – Glen is currently burning close to $500K a month
• 18:56 – Glen thinks that it should take at least 6 months before having to raise again
• 19:50 – Glen usually raises for a couple of years and each time he raises gives them 2 years of runway
• 20:15 – Gross annual customer churn
• • 20:30 – Churn has come down when they shifted their market
  • 21:25 – Glen shares what they did to combat high monthly churn
  • 22:38 – Handshake always has a negative revenue churn
• 23:30 – Glen wouldn’t sell Handshake for Nathan’s sample offer
• 25:10 – The Famous Five

 

3 Key Points:

• It’s difficult to create a SaaS that is web-based and mobile-based – it takes hard work.
• Delivering 100% growth with a better payback period is better than delivering 200% growth with a terrible payback period.
• Raising usually takes 6 months and it is the CEO’s responsibility to decide how he can leverage each raise.

 

Resources Mentioned:

• Acuity Scheduling – Nathan uses Acuity to schedule his podcast interviews and appointments
• Drip – Nathan uses Drip’s email automation platform and visual campaign builder to build his sales funnel
• Toptal – Nathan found his development team using Toptal for his new business Send Later. He was able to keep 100% equity and didn’t have to hire a co-founder due to the quality of Toptal
• Host Gator – The site Nathan uses to buy his domain names and hosting for the cheapest price possible.
• Audible – Nathan uses Audible when he’s driving from Austin to San Antonio (1.5-hour drive) to listen to audio books.
• The Top Inbox  – The site Nathan uses to schedule emails to be sent later, set reminders in inbox, track opens, and follow-up with email sequences
• Jamf – Jamf helped Nathan keep his Macbook Air 11” secure even when he left it in the airplane’s back seat pocket
• Show Notes provided by Mallard Creatives