Bootstrapping, Fund Raising and Exit: Mads Jensen’s Journey with Sefaira (Part 3)

Sramana Mitra: It was 2012 when you launched the product. How did you do that year? How many customers were you able to bring on in 2012 after the first year of the launch?

Mads Jensen: We grew at an accelerating clip from 2012 and until the exit this year. I couldn’t say exactly how many users we brought on in the first year. It was more work initially because it was a commercial offering and we were very keen to monetize. We didn’t have a freemium strategy. It was more of an enterprise strategy.

We went out to firms and we wanted them to pay us a subscription fee. The first 10 firms was incredibly hard. They liked what they saw but architects are not big spenders. We had to convince them of the merits of investing with us.

Sramana Mitra: How much were you charging?

Mads Jensen: Typically, between $5,000 to $10,000 per firm per year.

Sramana Mitra: There was a firm size tied in the fee structure.

Mads Jensen: Yes, price is higher for bigger firms.

Sramana Mitra: You were going for the larger architecture firms?

Mads Jensen: Initially, we went broadly to try and figure out who the right customer segment was. We learned that the mid-size and larger firms were the best prospects for us. We have customers from the largest firms in the world to firms with one or two practitioners.

Sramana Mitra: Was there a geographical focus?

Mads Jensen: We thought UK in particular would be the best market for us because there was a lot of legislation put in place at that time. Eventually, the US turned out to be, by far, our best market. Two-thirds of our business is in the US.

Sramana Mitra: What was the go-to market strategy?

Mads Jensen: Direct sales. Initially, we found we had to go out and meet people because we were these new kids of the block in a fairly traditionalist industry. We actually had to go out and meet people and shake their hands. As we started having the first 50 customers, we started to do more over the phone because we had reference customers.

Sramana Mitra: At which point in this journey were you able to switch? $5,000 to $10,000 per customer has to be sold on the phone, right? This doesn’t support a direct selling model in terms of in-person.

Mads Jensen: When we had 50 customers on board, it became easier for us to do business on the phone. That was probably a year to 18 months.

Sramana Mitra: Were the first 50 customers in Europe?

Mads Jensen: No, we started business in the US very early on. We actually opened our New York office in 2010 and ended up building a lot of our technology in the US. My co-founder is American.

Sramana Mitra: How long did it take you to hit the million dollar revenue point?

Mads Jensen: We got to it and celebrated for five minutes and then moved on because we were busy. I think it was about 2013.

Sramana Mitra: What was the next inflection point in your business? What drove that inflection point?

Mads Jensen: We became better at selling to the largest firms and selling more to the enterprise type of installations. That helped us take deal sizes from $10,000 up to $70,000. That made quite a big difference for us in terms of growing sales.

This segment is part 3 in the series : Bootstrapping, Fund Raising and Exit: Mads Jensen’s Journey with Sefaira
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