Featured Videos

A Textbook Case Study of Capital Efficient Entrepreneurship: Bhavin Parikh, CEO of Magoosh (Part 6)

Sramana Mitra: When this happened, who else was in the company?

Bhavin Parikh: When we raised in May of 2011, we made that blogger into a full-time employee. He was doing content marketing for us full-time. He was also helping us create content for our product. Then, we hired a software engineer who had interned with us the previous summer. He rewrote the entire application. I mentioned earlier that we knew we would have to throw out the work. We ended up having to throw it out. He rewrote everything. We were able to add more features much faster.

Both of these individuals are still with us. Then we had a team of interns that first summer in 2011, out of which we found one marketing person. Basically, we had one person doing GRE content, one engineer, a marketing person, and a GMAT person. That was the team when Hansoo was diagnosed with lung cancer. >>>

Bootstrapping from Belgium: iText CEO Bruno Lowagie (Part 6)

Sramana Mitra: Belarus is not your own division?

Bruno Lowagie: No, it’s not our own company. It’s a company with a subsidiary in Belgium. We pay the Belgian company but the people who work on iText are in Belarus.

Sramana Mitra: How has revenue ramped?

Bruno Lowagie: I believe that in 2011, we finished with $2.4 million. Then we switched to accounting in Euros. In 2014, we had €5 million.

Sramana Mitra: This is all self-financed? >>>

From Y Combinator to Customer Traction and $50 Million in Financing: MemSQL CEO Eric Frenkiel (Part 6)

Sramana Mitra: When you raised the $35 million, how many customers did you have?

Eric Frenkiel: I don’t recall the exact numbers, but it was around a dozen customers at that point.

Sramana Mitra: Were these large companies? What kind of customers are we talking?

Eric Frenkiel: They were all logos that anyone would recognize. One of the things that we also did was not to focus on selling to startups or early stage companies. We really wanted to prove that the technology had legs by delivering value to companies like Comcast and Samsung.

Sramana Mitra: You went after the regular enterprise customers and not the Lady Gaga kind of customers? >>>

A Textbook Case Study of Capital Efficient Entrepreneurship: Bhavin Parikh, CEO of Magoosh (Part 5)

Sramana Mitra: Interesting. That started converting as well. This was not only traffic but it was the right traffic.

Bhavin Parikh: Yes. The thing is you don’t see the conversion immediately because people need to build that relationship with you. They come to your site. They read a post and start to think, “They really know what they’re talking about.” I really think the articles need to be strong. You can’t hire someone with no expertise in the field.

Sramana Mitra: Yes, content marketing only works if you can produce good content.

Bhavin Parikh: Exactly. They would come again and again. The other thing is, it could pay off indefinitely. A great article will still be a great article well into the future. You could go back and update it. People will search and come across that article. Content marketing was huge for us in terms of getting the business off the ground. That was our initial year of customer acquisition. >>>

Bootstrapping from Belgium: iText CEO Bruno Lowagie (Part 5)

Sramana Mitra: Were you still in Gent?

Bruno Lowagie: I was still in Gent and we’re still in Gent. In 2009, the list was finished and we didn’t find any new customers. We then made a bold move. We changed the old version of iText from the LGPL/MGPL to the AGPL. That’s a more viral license. With LGPL, if you have engine and you build and distribute a car, the car can be commercial. With GPL, you have to distribute the car as GPL too. There was one problem with GPL. For instance, if you build a bus instead of a car, you don’t distribute the bus. You sell tickets for people to use the bus. That’s my analogy with SaaS.

What we saw was Google didn’t distribute software but they built a service and charge for the service. That wasn’t distribution in the context of the GPL. That’s how Google got big because they used all of these GPL software and they didn’t distribute it. They didn’t have to pay for it. I changed iText to AGPL. In AGPL, putting the software on the server is also seen as distribution. If you have software that uses iText under the AGPL, you need to disclose your complete code base as AGPL. >>>

From Y Combinator to Customer Traction and $50 Million in Financing: MemSQL CEO Eric Frenkiel (Part 5)

Sramana Mitra: How did they find out about you?

Eric Frenkiel: We were introduced to investor networks. There were investors who knew the startup needed a really strong database product. They put us in touch. We gave them a demo and they knew that was going to help them develop fast. That was our first customer. It was a lot of fun.

Sramana Mitra: What happened next?

Eric Frenkiel: That takes us to the summer of 2011. We concluded the first feature set and we launched in June of 2012. In six months, we had more than 10,000 developers using the software. We immediately saw the market resonance about in-memory database that was fully relational. It wasn’t the full vision though. This was a single-box version of the software. If you’re happy with the product at launch, then you’ve launched too late. We knew that we had launched an MVP. That was the first step. >>>

Bootstrapping from Belgium: iText CEO Bruno Lowagie (Part 4)

Bruno Lowagie: I asked what we can do to solve this. IBM said, “We have to do it the hard way.” Actuate was a company under the Eclipse umbrella. They entered a research agreement with Gent University. The deliverable was an IP overview.

During 2007, I went to the university to do my job but as soon as I received a report from IBM Canada with some issues, I had to drop everything and fix the issue. Every week, I would get an Excel file with potential issues. For instance, I used some code that was released under a certain license. I was allowed to use it but inside the code, there were some remnants of a project that had started as a close source and was suddenly brought to the open source. But then the source code is set as proprietary to some. We had two conflicting licenses. The lawyers said, “Better be safe than sorry.” >>>

A Textbook Case Study of Capital Efficient Entrepreneurship: Bhavin Parikh, CEO of Magoosh (Part 4)

Sramana Mitra: At that time, the competitive landscape was limited to that other company that was not as far along as you or were there other people who you were competing with?

Bhavin Parikh: There were several other companies that we were competing with. There were the big institutions like Kaplan and Princeton Review. In the online space, there were two very well-funded competitors. One was called Newton which is still around and has pivoted a more technology-centric space. They were providing GMAT prep at a much higher price. There was Grockit. Both of those companies have raised over $25 million. Grockit was more about test prep with gamification and a social element. They ended up pivoting into something else and sold off the Grockit side of the business to Kaplan. >>>