Sramana Mitra: It sounds like the scope of what you’re talking about overlaps with all sorts of existing products like DocuSign or EcoSign. How do you position in this general ecosystem?
Mikita Mikado: I find that the space is quite similar to the CRM space. There were lead management products and sales compensation products. There were a lot of pieces till Salesforce emerged. What we’re looking to do is a commerce platform for businesses to transact deals.
Signatures is part of our product. It’s a really nice feature. People get a lot of value by using electronic signatures, but it’s not what our product is about. I don’t really believe that signatures alone are going to bring enough value for businesses to stay. What we’re doing is a complete suite of tools and a product that allows you to go from an offer to money in the bank. That’s our vision and mission.
Our approach is fundamentally different. We turn a document into a vehicle that drives the transactions. When it comes to something like DocuSign, what they do is they work with files or either add a signature on top of a PDF file or produce a PDF file. We don’t do that. Documents in our product are electronic. They’re born in the cloud. They could be edited. We use HTML instead of PDF. The main difference is that PandaDoc is an all-in-one platform that allows you to make offers, collaborate on proposals, close deals, and get paid.
Sramana Mitra: Where are you positioning this?
Mikita Mikado: As of today, we’re in SMB and we love it. We have more than 7,000 active paying accounts. We’re growing rapidly every month.
Sramana Mitra: What do you charge?
Mikita Mikado: It goes anywhere from $20 to $75 a month.
Sramana Mitra: What is the sales model? Do you have to sell or is it something you have to sell online?
Mikita Mikado: It’s both. Half of our customers are self-service and the other half are sales-assisted. Bigger ones are sales-assisted.
Sramana Mitra: Did you do all of this out of Belarus?
Mikita Mikado: I moved to San Francisco to raise money and scale PandaDoc about four years ago.
Sramana Mitra: The 2013 effort that you described of talking to a whole bunch of people before developing the product, that was done after you moved to San Francisco?
Mikita Mikado: It was in between. In 2013, we started to think about going beyond proposals and moving into commerce. That’s when we started doing those interviews. I moved in April. Most of the interviews were done out of the States. It took me a year to get an O1 visa. The first year, I had to go back and forth.
Sramana Mitra: Visa situation is a nightmare. Tell me the sequence of events. What did you raise your angel financing with? What was done at that point?
Mikita Mikado: We started to do customer interviews and I started the fundraising process. We raised $650,000 in our seed and then extended it with another $400,000. Our total seed round was $1 million.
Sramana Mitra: How did you do that? You were not from San Francisco. You didn’t really have a network here.
Mikita Mikado: Hustle. How did you do it when you moved here?
Sramana Mitra: I went to MIT. When I moved here, MIT had 800 alums in the Bay Area. Today, they have 13,000. I used the network and built the network over time because I spent the first part of my career constantly raising money. Networks build over time. Moving here and immediately raising financing is a very complex timeline.
Mikita Mikado: It wasn’t immediate. The business was solid. It had some monthly recurring revenues.