The Path to $100M: How We Doubled from $25m to $50m ARR TTM

who you're going to learn from now is someone that uh understands data understands growth understands how to do it in a full control kind of way please help me give it up for J revealer Jay come on up thanks for being here man super it's super it's super good to see you I remember um we caught up recently because they had you back on the podcast and I I never know how people have grown in terms of Revenue when you said the number I said what yeah what's going this is incredible yeah well we're going we're going to make a 100 this well here

you go stage is yours have a lot of fun coach us up all right well I'm I'm feeling um a little out of place I definitely don't have the cool pants going um and uh hard to uh hard to beat the this the two sessions before but I'm uh I'm excited to be here I guess I have the socks so maybe not the pants but I got socks to uh be my thing uh I'm excited to tell you the story of rer we are uh we're in an interesting space our story is not one that was birthed

overnight we've gone through our challenging times but now we're in a great place and uh and I'm proud of because we've been really great stewards of capital we've raised capital from institutional investors we've never raised a crazy round at some uh valuation that we couldn't live up to and it's allowed us to build a phenomenal business so as uh as I spend 20 minutes with you today we're going to cover three things uh a little bit about rer we're in the health care space it's

complicated it's a bit technical give you a little bit of kind of understanding of what we do uh and how we're on a path to build a billion dooll company talk about our superpower I think everybody has a superpower when I interview Executives I'm trying to understand what their superpower is and how do they bring that to our company and I'll share what our company superpower is and how it's allowing us to succeed in a uh in a big space um and one that uh many might consider crowded

and I'll share some learnings the words here might look like they're simplistic and trit but I'll hopefully share some learnings that um that we've gone through where we've skinned our knee where we've fallen and hopefully you won't do the same uh yeah we've had a pretty interesting ride over the last few years what's important here is um over the first six years that I've been running this company it uh took us six years to

go from 1 million to 25 and we had many moments where we thought we were on that hockey stick and it was was all going to be great from there on in we uh we were feeling that way and uh coming out of uh 2019 and then all of a sudden covid hit and our first reaction was we're in healthcare we're in a government sponsored part of healthcare it's not going to impact us and next thing the government shut down uh a lot of the markets that we were in so uh we took a

pause um but coming out of 21 uh things really took off uh so six years from 1 to 25 one year from 25 to 50 and this year we'll go from 50 to 100 and we're really uh uh excited about that uh and we're generating cash and we're generating really strong IA which is giving us an opportunity to drive this business with some smart and strategic m&a which I'll talk about and I think there was uh we have some things in common with the earlier

speaker so revier at a uh at a glance um we're a healthc care company uh I'm passionate about uh making Health Care better uh and we're in the corner of value based care and for the audience here value based care simply put is about getting payers and thinking the insurance companies and providers Health Systems and doctors to work together to ensure that a patient their member gets better the typical Healthcare model is a

feif for service model you go in you're treated you leave and that doctor that health care professional does really have an incentive to make sure that you stick to a care plan and you get better so we're in the value based care world uh we're using Ai and workflow uh automation to bring those payers and providers together to better understand what's happening with the patient and uh and we're taking off like I said we'll do about 100 million this year uh we'll probably have an AR end of

year ARR of 105 to 110 uh and I think that puts us in a position to do $2 200 million next year but what's really important uh we got strong gross margin now generating iida and it allowed us to do a debt raise that Nathan referenced earlier so we did a $65 million debt raise with a company on the bottom Hercules capital and we're excited to welcome Hercules as a Capital Partner along with two institutional Equity

Partners uh Oak HC uh ft which is well known for their work in healthcare and upfront Ventures located in Los Angeles your typical broad based long-term Venture investor so how do we build a company now approaching a billion dollars of uh value uh one we had the vision early on uh we had a vision to take a tech enabled Services market and transform it

to software the typical Mark andreon software eating the world our Marketplace that we're selling into has been served by Tech enabled Services armies of people working offshore to digest clinical data and we're doing it through automation so we started there and then we saw a bigger opportunity to be the platform for Value based care and that's where our m& strategy aligned with strong product Innovation is really

driving transformative outcomes we brought on a transformational capital partner in 2021 and you know people talk about uh when you go out and look for an Institutional Investor it's more than the money that's true when you really need the money maybe you're not always thinking about what else they bring but we brought on Oak hcft they had a shared Vision with me on how we could build this value based care platform and we immediately aligned on

what we could do together and they have been nothing short of amazing uh we went from closing our round with them in November of 21 uh to closing our first acquisition in March of 22 a company that I built a relation ship with over a number of years and so one thing you'll hear from me on our m&a and I have a a slide in a few minutes to just talk about how we've done that um every company that's in our pipeline we've built relationships with

over a long period of time my had of corporate developments in the back I think this year alone up until September one we've talked to 60 unique companies we're working on a transaction now with a company that we first broker a relationship with in early 20 uh late 21 so we try to start with a partnership make sure this product Market fit and if our values and our culture aligned we try to make something else uh happen but Oak has been a transformational Capital

Partner product driven m& um I think chili Piper was talking about there's consolidation in healthcare why is there consolidation because there's concern about Phi risk all the data that we all sit on and what would happen if a company's breached there there is a well-known uh breach that took place early this year with a company called change Healthcare massive 8 billion Revenue company that shut down the healthcare market and it's really turned off big insurance companies and health

systems on dealing with Point Solutions they're concerned about the risk so scale matters uh we have a great product uh team but we are rounding it out with uh thoughtful strategic mmaa and with every good story there's grit uh we've had those moments where we weren't sure we were going to make pay role we were stuffing some invoices in in drawers and we were paying the loudest uh person that was calling uh there was a moment in 2018 uh after a successful run at a

prior company I bought uh kind of the the uh the last house I thought I would ever own in 2018 I put that house up as collateral when we couldn't make payroll and we went for a a debt financing just to bridge us um and that's what you do when you believe in the vision you believe in an opportunity and you have confidence in your team um so how have we been able to scale this company um so 2019 was our

first um time that we introduced machine learning into our product now everybody's calling it AI um I mean AI is machine learning it's rules uh we introduced it in 2019 in a way to read a medical record we now ingest almost a billion pages of medical records annually think about that it's like 3,000 Pages a minute um so we introduced that which drove a lot of Automation in our platform which led to us signing our

first National Health Plan 21 Oak comes in first time we have capital on our balance sheet to shift from playing defense to offense allowed me to go out in the market make some new executive hires upgrade talent and it's interesting to think about the talent that you can attract when you're sub five million from 5 to 10 above 10 and now we just brought on a new Chief product officer who joined our company a week ago and what we can get with a company that's 100 million going to 200

million um and then we did the two Acquisitions uh we did an acquisition beginning at 22 a company that rounded out a solution set for us and a company in 23 that moved us from payer into the provider space um and we'll talk about how that's expanded our Tam and so as we've been thinking about this business and I and as I think about where we're going I am always focused on the total addressable Market uh I do think it gets overinflated I think that was a comment

made earlier and so we work hard to say in that market how much can we really sell into are there players who will never buy what we have to offer uh and we keep thinking about how can we broaden it with new solution offerings that make sense that are largely the same buyer inside the logos that we're selling to so we started with A2 billion Doll Market which seems pretty big hard to build a really scaled business on a $2 million Tam 2020 we introduced our

second product Suite through our product team and it widened our Tam immensely and then in 2022 uh with our first acquisition it moved us into another product Suite adds another couple billion dollars to our Tam and then most recently in 23 with our second acquisition add about 4 and A5 billion to our Tam and now we sit with a company that 100 million in a 20 billion do Market with clear line of sight to build a half a billion dollar

business our superpower is around how we ingest data um and so at the heart of Health Care you have massive amounts of clinical data being generated daily estimate right now is 1.2 billion clinical records being created annually the problem with that is it's a massive amount of data that your doctor can't digest that it's hard for them to get a hold of it it's hard for them to understand that and to be able to use

that to their advantage in a 12 to 20 minute visit and that's what we do We Gather that we distill it and give them three to five recommendations when a patient comes into their office and that's our superpower um all right so let's talk about uh strategic m&a um so as I said we've we've been able to grow our company through it and if you look at our 100 million in revenue for this year roughly 10% of that is acquired Revenue so we didn't

hit we didn't go from 50 to 100 by making this massive transformational acquisition we saw a product Gap we knew if we filled it we could sell uh a larger U solution solve a bigger problem and get ourselves in Opportunities where that door was being shut on us in the past and I'll show how that's played out at the end with a couple of metrics so we've done two with those two like I said had about 10 million in AR close and in 12 months across the two them we've been able to double the business

uh but also fueling our other Solutions and interestingly on the first one we were um 70 probably 75% uh Equity 25 75% cash to pay for that 25% giving them Equity our second deal um the equity uh shifted to being 50/50 equity and debt so we had our debt partner and now we're working on our

third where we'll be 100% funded by by debt and we can do that because we're generating strong cash in our business and it's given us the ability to control that manage our cap cap table ensure that we're taking care of our investors yes so um you here we are with a couple Acquisitions under our belt company scaling uh really leading to some pretty fantastic metrics for the

business um top I thought I'd just show kind of go to market coverage actually I think for 2025 our go to market coverage will be 65 million so when I talk about superpowers I think my one of my superpowers is go to market how do you scale a business in the marketplace so I think all the time about how much quota we have on the street if I'm at an industry conference I'm always trying to talk to sales reps of competing companies to understand what they're doing how they're incentivizing their people do they actually have proper uh compensation plans and I'm shocked at

how often they don't when someone says I don't have a commission plan I'm bonused I'm like well if you have a bonus you're not a sales rep um so we we uh we're thoughtful about how we go to market it's leading to larger deal sizes it's amazing that we were doing average deals of under 200k in 21 and our average deal today is over 800k like we're in a lumpy business it's B2B Enterprise so we have 70 you know unique logos maybe uh approaching 80 at this point we're not

selling to tens of thousands of of endpoints um so when you get one of those you try to have a big impact and you got to make sure you focus on retention you can see net retention um in lower left and I'll talk about some of our learnings on that front um and on historical headcount I just want to show um we're a Growth Company driven by product Innovation and you can see how the headcount is jumping our U R&D team product AI engineering jumping

significantly from 21 to 24 and our go to market team making big strides uh in 21 22 we had two reps the problem with two reps is you never want to let go one who's underperforming because then you're down to one and you're kind of held hostage and now we have a large sales team um Broken Out by payer provider strategic reps field reps folks Focus uh focusing on our install base and it gives us an opportunity to

continue to upgrade and strengthen the team all right so what are uh some of my critical learnings over the last eight years and uh Talent everybody talks about Talent talent's important I used to interview every single person we hired can't do that any longer I'm fascinated by those leaders who say they do it at uh sizes uh company's much bigger than ours I don't know how they do that I'm impressed by it I do interview every VP from our executive

team here's an interesting metric um I'm proud of it at times but I also question my own skill the average tenure of an executive on my team right now is 1.75 years if you take me out if you put me in there you know being here eight years it kind of bloats the number but 1.75 and the point of sharing that is we've steadily upgraded the talent as we've summited uh a new mountain and we're looking at the next and that might sound

harsh uh but it's really important and it's critical if you want to build a large and sustainable business um you know I heard an interesting quote I'm a sports uh guy played hockey I have two boys who play baseball and so now I'm like in the baseball world and I heard a baseball coach recently say to a player uh this is a college coach my job is to figure out every day how to replace you your job is to figure out how I can't and I think you have to think that way with Talent uh scale scale matters

particularly in vertical SAS that's the world we're in scale matters Point Solutions aren't going to survive uh and so we are moving aggressively down this uh inorganic organic path and so I if you're in vertical SAS I would think hard about how you scale we've done a lot on the Innovation front we did it when we didn't have Capital because we found Partners who believed in us and we innovated with them we had one partner very early on that leaned into us when we were talking

to big companies that we just didn't think they would pay attention and help us at time of need and then we ultimately bought the IP back from them as we got more scaled so I believe in Partners I believe in Partners but I believe you also need to know what is critical IP to you for you and to make sure that you get that back if it's not in your house today lastly on customer retention uh and it's a humbling one for me to share because uh I was one of the preeminent uh folks around customer

success before it was its own function and as I look back on my time leading this company we have had a couple of moments where we've stumbled on the customer success side and when you do that in vertical SAS and B2B with large deals that can be hugely disruptive we had a lighthouse customer that got noisy we thought they were being overly demanding we started to push price higher and then on July 3rd right before July 4th they send a notice of

non-renewal and it almost led to 30% of our company being laid off coming out of the July 4th holiday we launched a project to figure out how to grow through that and we successfully signed a company that was four times larger within about 60 days but it was a great lesson to not get uh if you have that kind of lumpiness in your company you need to be really smart about how you deal with those Enterprise customers and so we're leaning in really hard on our customer success team now to ensure that

that doesn't happen again all right so I think I'm at the end of our time hopefully I've done a good job of giving you uh insight into how we're building a billion doll business uh I think we're really on the cusp of achieving that for our investors it hasn't been easy um it comes through a couple of superpowers how we deal with product Innovation with our Ai and machine learning how we're using thoughtful m&a uh and how our capital and uh equity and debt partners are

fueling our growth and uh and hopefully you won't go through some of the uh you won't skin your knee the way I have over the last eight years and thanks for listening enjoy the rest of the day [Applause] [Music]