Bootstrap First from Belarus, Raise Money Later from Silicon Valley: PandaDoc CEO Mikita Mikado (Part 2)

Sramana Mitra: You got the business going while you were in Hawaii – the business that you are running now?

Mikita Mikado: Somewhat. I tend to believe that what we have now is a consequence of what happened back then. I’ve been running a web design agency. That agency got me and my co-founder to build an extension for a web content management system.

That made us a little bit of money, so we built hundreds of those extensions. We scaled that business to about 100 employees. We’ve been doing web content management for quite a while. Web content management led us to start a business around web documents.

Sramana Mitra: Let’s talk a little bit about the web content management business before we come to the document part. You mentioned a co-founder. Is that somebody from Hawaii?

Mikita Mikado: Somebody from Belarus. We played in the same band while in school. He was a pretty good drummer. I was a mediocre bass player. That’s how we met. When I went to the States, he was probably the smartest guy I knew at that time. I really wanted to work with him. When these extensions started to sell, I wanted to take it to the next level. We didn’t go big but we scaled it to 40 people.

Sramana Mitra: These 40 people were in Belarus?

Mikita Mikado: Yes.

Sramana Mitra: That’s a great situation where you have a very good cost structure with which to do these projects.

Mikita Mikado: Yes, it’s one thing to build website extensions out of the States when you have options to go work for Google or Microsoft. That was a cool business.

Sramana Mitra: When you say you were building these content management system extensions, were you extending a particular content management system for multiple clients? Can you double-click down on what exactly the business was?

Mikita Mikado: Sure. We started with just one content management system, which was called DotNetNuke CMS. It’s like WordPress. It’s a very simple website management software. We built a bunch of add-ons like design add-ons, video gallery modules, or blog modules. We sold those add-ons online.

About half of the revenue was coming through those online sales but the other half was coming through companies buying those extensions and looking to do some customization and modifications. We landed Microsoft while sitting in a bedroom apartment at Minsk. They just found us online. They paid us $4,000.

Sramana Mitra: How long did it take you to hit a million dollars with that model?

Mikita Mikado: We never actually got to a million. It was like $800,000 a year at its peak.

Sramana Mitra: Pretty good though. What year was that?

Mikita Mikado: It took us about three years. 2010 was the peak.

Sramana Mitra: At this point, you had moved back to Belarus?

Mikita Mikado: Yes, I decided to move back. There was too much work to be done.

Sramana Mitra: Then what happened?

Mikita Mikado: We had to do a lot of sales proposals. We didn’t really like the process. They were taking a lot of time. We didn’t know if our clients ever opened those proposals and if they took us seriously. That got us to a product that my co-founder came up with. It allowed us to build web-based proposals and send them online as links. They can accept it online. They can sign on it online. We launched it in 2011. It was bootstrapped to about $30,000 monthly recurring revenue.

This segment is part 2 in the series : Bootstrap First from Belarus, Raise Money Later from Silicon Valley: PandaDoc CEO Mikita Mikado
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