Sramana Mitra: What kind of average deal sizes are you selling right now?
Rafael Sweary: I can’t disclose details, but it’s more than hundred dollars per month.
Sramana Mitra: That doesn’t say anything. What else do you want to say that is interesting?
Rafael Sweary: We’re trying to build a world where software will understand users and websites will understand users, instead of users trying to understand software and users trying to understand websites. The second word of wisdom to people who want to be entrepreneurs is, entrepreneurship is a roller coaster. That is the best description for how an entrepreneur’s life works.
One day you’d say you’re going to change the world. The next day you’d feel crazy for doing something that nobody else is doing. You must be prepared and understand that you can’t do everything on your own. You need to have a great team around you. You cannot build a company by having superstars. For example, in a soccer game, one player can make the difference but you need the whole team. You need everybody to be good to be a winning team.
Sramana Mitra: I want to go back to your earlier comment where you said that your vision is to create a product such that you can help software understand users and help them move through a website as opposed to users trying to understand the website and the software. Can you double-click down on that comment and talk about some specific examples of how you foresee that transition coming about?
Rafael Sweary: An excellent example is using a mobile app. When you use a mobile app, you might be in different situations. We can learn a lot about you based on these situations. Are you driving? Are you sitting? Are you home? Are you roaming? That helps us understand and offer, with the app, the thing that you’re most probably trying to do.
Think about a situation where you are searching on your phone for Toys “R” Us while you are driving. What you most probably would like to know is where is the nearest Toys “R” Us store that is now open and what are the directions to get there. What WalkMe is able to do today is to anticipate and understand what it is that the user is trying to do and help him do that.
In the example I gave you, the user is provided the nearest store. The user is then taken to his navigation system. That’s the type of world that we want. We want the websites and software to understand the user.
Sramana Mitra: One aspect of your business that we haven’t discussed is further fundraising. You said you raised some money early on but you have raised a lot of money since. What were the metrics with which you raised each of those rounds?
Rafael Sweary: The first professional round was done with a company called Mangrove. Mangrove is a leading European VC. They invested in companies like Skype. The reason that Mangrove decided to invest was because one of their portfolio companies was using our product.
That company told Mangrove that our product had phenomenal effects on their support calls. They put us in touch. From their Board, they introduced us to a gentleman by the name of Michael Jackson. We showed it to him and he said, “That makes perfect sense.” He introduced us to another partner there. When he liked it as well, we flew to Luxembourg to meet with them. They gave us money. We didn’t have metrics to show.
After we raised that money, we actually started building a plan. We started forecasting from our history. Once we built that plan, we saw how much money we needed. We went and raised some more capital from additional institutional funders — Giza and Gemini. Then we started growing. We pivoted.
Sramana Mitra: The pivot is the switch to enterpeise?
Rafael Sweary: Yes. The pivot was in July 2013. In December, we were able to raise financing from Scale Ventures. Scale Ventures is an amazing fund when it comes to SaaS. Rory, who is the partner who invested in us, had a lot of SaaS experience. He gave us a lot of ways to analyze and how to really understand the business and business metrics. We continued growing then. The VC funds raise capital from bigger funds called funds of funds.
One of those funds of funds, Green Spring, was an investor in two funds that were already in WalkMe. One of them was Scale and the other was Gemini. I guess they mentioned WalkMe to Green Spring and they wanted to invest directly into WalkMe. The round that they led was a $25 million round. At this time, the company started picking up.
The next round happened in late 2015. We saw that the company was growing very well. We also had a lot of money, but we wanted to push a more aggressive plan. The Board allowed us to go and raise additional funding. Within a month and a half, we got the biggest round, which was for $50 million. Our metrics were very good. We were growing very well. The hardest round was the first one.
Sramana Mitra: Always.
Rafael Sweary: Every round after was easier although the size of the funding increased. The $50 million round took about six weeks from meeting with them till the money was in the bank.
Sramana Mitra: That’s awesome.
Rafael Sweary: When you do a $50 million round, it’s not an idea anymore. It’s a business with solid financials and management.