Capital Efficient Startup, Venture-Scale Growth: ShipMonk CEO Jan Bednar (Part 4)

Sramana Mitra: Shopify has done one of the most aggressive and successful PaaS strategies where they have invited developers to develop and extend their platform.

Did you take advantage of that with your software? Did you integrate with the Shopify platform? Was the Shopify marketplace a good source of leads for you?

Jan Bednar: That was the first piece we did. We knew that our customers were going to come from Shopify, so we built a pretty robust integration to make sure that orders sync effortlessly. That was one of the value-adds that we add to our customers. 

Sramana Mitra: What percent of your leads come from the Shopify integration?

Jan Bednar: Probably 5% from the app marketplace. Most people, when they’re looking for fulfillment services, they don’t think to go to the Shopify marketplace first. They first do Google search. There are some people who go on Shopify, but that’s rarer.

Sramana Mitra: It’s not a lead generation source, but the fact that you have the integration helps you close the deals.

Jan Bednar: Yes.

Sramana Mitra: Growing from a million to $4 million in one year, what did you do about the warehouse space?

Jan Bednar: That was challenging. We moved from a 3,000 square foot space to a 15,000 square foot building in Pompano. That was our first building that we had to start paying for. It was a big change. It was also a lot more expensive.

Within four months, that building was full. We had a three-year lease, the building was full, and we’re not even at peak. We ended up buying a mezzanine. We got it at an auction somewhere. We brought it in.

We ended up building the whole mezzanine ourselves. It was a massive project. It got us through the worst. We suddenly had a second floor. That lasted us through the end of the year. Then we got a new warehouse at the end of the year.

Sramana Mitra: That’s a great story. You’re doing all this with no outside financing?

Jan Bednar: Correct, and no debt. We put every single dollar back into the business. We weren’t living a luxurious lifestyle, but that’s what you have to do. You have to live a couple of years like nobody will so that you can live the rest of your life like nobody can.

I was so lucky that the rest of my team was thinking the same way. Everybody was underpaid. A lot of these guys had equity. That was the mentality. That was the key ingredient to our success – the people we had onboard.

Sramana Mitra: How did the revenue trajectory from 2016?

Jan Bednar: It was $11 million in 2017. We moved to a bigger building and we also opened our first building in California. In September of 2017, we opened our first building in California. 

This segment is part 4 in the series : Capital Efficient Startup, Venture-Scale Growth: ShipMonk CEO Jan Bednar
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