From Developer to Cyber Security Entrepreneur with $10M Revenue and $18M Funding: LoginRadius CEO Deepak Gupta (Part 3)

Sramana Mitra: In what timeframe did you zero in on the pricing model?

Deepak Gupta: We did experiments on pricing. After 9 to 12 months, we got to a decent pricing model.

Sramana Mitra: Can you talk about those experiments? What was working and not working?

Deepak Gupta: First, we experimented with some features. We had some add-ons where customers can pay more for a social login product. Then we started with pricing plans. Then we experimented with user model. We did a series of experiments around having a free trial and having a full-paid version. That’s how we learned what customers want and how they react when they see the pricing.

Sramana Mitra: What were some of the key lessons from those that drove you to determine what would be the pricing model?

Deepak Gupta: The add-on only pricing won’t work. We have to have plans. The second thing is if we can have a free plan where the barrier to entry is low, that would be better.

Sramana Mitra: You needed a free trial?

Deepak Gupta: Free trial for the paid product. Then there is a limited free version.

Sramana Mitra: So the number of people who could store their passwords was a limited number. The people can get started but wouldn’t scale.

Deepak Gupta: Yes.

Sramana Mitra: That sounds like the right pricing model for your product.

Deepak Gupta: Yes. Then as we grew the team and had some funding, we started building more products.

Sramana Mitra: That first million came out of the password product?

Deepak Gupta: Yes.

Sramana Mitra: How far did you go with the social login product? How much revenue were you able to generate?

Deepak Gupta: It was less than a million but close.

Sramana Mitra: That was during the bootstrapped phase of the company?

Deepak Gupta: Yes. We might have done a seed round by then. We were at the half million mark before we raised.

Sramana Mitra: How much did you raise?

Deepak Gupta: $1.3 million.

Sramana Mitra: From?

Deepak Gupta: Angels, and friends and family.

Sramana Mitra: The idea of that seed round was based on this social login product or did you have more of a roadmap?

Deepak Gupta: We were focusing on the social aspect of it. Not just social log in but having more components around the social. That was the initial idea.

Sramana Mitra: What were those components?

Deepak Gupta: It focused on social engagement. How a business can engage users through social elements. The initial idea was to have a social engagement platform including the social login.

Sramana Mitra: Did that work?

Deepak Gupta: It did not work.

Sramana Mitra: The seed investors invested in the basis of that thesis, but that didn’t work. You had to pivot.

Deepak Gupta: That didn’t scale, I would say. It started working in a couple of verticals, but it didn’t scale. The biggest challenge was churn. The small businesses would churn if their social components don’t work. It did not scale well with the revenue.

Sramana Mitra: What did you do?

Deepak Gupta: Some of the customers were asking if they can have the full authentication. Can we have other single sign on components? That’s where we did some research and we thought that it would be a good idea. That could scale and it would have less churn if we can help businesses with the full authentication.

This segment is part 3 in the series : From Developer to Cyber Security Entrepreneur with $10M Revenue and $18M Funding: LoginRadius CEO Deepak Gupta
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