Bootstrapping to $10 Million Using Services: Sameer Maggon, CEO of SearchStax (Part 3)

Sramana Mitra: What was the pricing?

Sameer Maggon: The first offering that we sold was for about $10,000 a year. 

Sramana Mitra: How did that business ramp? When you start off with a bootstrapping with services model, your services revenues far outpace product revenues. Gradually, it starts to tilt.

Sameer Maggon: In the first year, we were at about $100,000 in revenue. Since then, we’ve tried to grow more than 100% year over year. This was 2016 when the product revenue was fairly little. It took us four years to get to a point where our product revenue was more than our services revenue. I believe our ARR was $1.5 million. At that point, we decided that we’re not going to do services any more. We started ramping down our services business. Today, we are 97% subscription business. 

Sramana Mitra: You’re at about $5 million in revenue.

Sameer Maggon: We’re just shy of $10 million.

Sramana Mitra: How big is the team?

Sameer Maggon: We are 37 people today. We’ve grown tremendously this year. Last year, we were about 15. We’ll be 40 by the end of the year.

Sramana Mitra: How do you acquire customers?

Sameer Maggon: The primary acquisition method is Google search. A majority of customers who came to us was when they were looking for a need in the market. Our product has evolved since the first time. Now we offer a full search solution. We started a niche around Solr. A lot of effort was put in SEO. That brought most of the leads into the business. They were looking for a Solr service that would not need a search infrastructure. That has evolved now.

Sramana Mitra: Why Solr?

Sameer Maggon: A couple of things. We tried and tested a couple of things in the early days. What we found was there was a white space in the Solr market for a strong enterprise level Solr service offered as a SaaS offering. We felt like this is a white space that we can capture. We can be the best at doing what we’re doing and be miles ahead of competition. 

Sramana Mitra: So you created a Solr search engine that other people were looking for.

Sameer Maggon: I didn’t create a Solr search engine; Solr is an open-source engine. What I created was a SaaS offering that delivered Solr. If you’re familiar with MongoDB, MongoDB is a software, but they have an Atlas offering which is MongoDB-as-a-Service. We take the pain out of running and managing Solr in the cloud environment. 

Sramana Mitra: So you took the commercial open source strategy?

Sameer Maggon: Right. We commercialized making Solr easier to run in the cloud environment.

Sramana Mitra: How far did you go with that strategy?

Sameer Maggon: We’re still going with that. We are starting to go upstream now. We launched a new product last year. It not only makes it easy for developers to run and manage Solr in the cloud, but we’re also starting to bring business tools and analytics into a newer offering. We’re going up the stack that’s available for marketing teams as well.

Sramana Mitra: You have chosen to remain bootstrapped. Is that your long-term strategy?

Sameer Maggon: I don’t think so. We are starting to accelerate. As we’re starting to grow from this niche space to becoming a search platform, I can see us looking into funding sources. 

Sramana Mitra: Well-navigated so far. Congratulations and thank you for your time.

This segment is part 3 in the series : Bootstrapping to $10 Million Using Services: Sameer Maggon, CEO of SearchStax
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