How Datanchor CEO Harihara Indukuri grew Datanchor to $1.5M revenue and 33 customers in 2024.

hey folks my guest today is emory coxell he's the founder of data anchor and a professor at ohio state university he received his phd from mit and has published more than 100 papers on top venues along with having eight patents issued he's testified to the congress and among his awards include the nsf career award and hp innovation research award now award now building anchormydata.com which enables data to protect itself i'm ready to take to the top perfect thanks for having me you bet okay so talk to me a little bit when a customer starts paying you or starts using you what are they getting what do you help them with so it is a kind of a move away from the traditional parameter centric model which is basically about building castles fortresses around your network which we used to presume the activity around data is right but in today's world the activity is everywhere data is everywhere you're accessing your data from home from your mobile devices not just from the network also it's in the cloud iots and so on and so forth so what they get is uh you know data security in the form of zero trust integrated down to each file so once you integrate security into data itself as opposed to activity around data what you get is basically security traveling with the data you don't care where you your users your collaborators are accessing the data it is secure anywhere and you know as a result it simplifies your workflows it simplifies collaboration and helps you become efficient without sacrificing uh from the security side i see and when when customers sign up for this help me understand your pricing what are they paying on average per month to use your technology so our msrp is just like any sas product it's based on a perceived so they're paying 16 per seat per a a month right now to to get everything so it's unlimited data it doesn't limit the amount of data they protect they can protect from you know one file all the way to the entire drivers or all their data we don't care the amount of data but it's a user-based model and emery on average when a team signs up for you are they signing up one person or cto or a hundred people what's the average number of seats oh it it so we have customers with a few thousand users we have customers with 10 users so it's a highly variable the value is basically again as i said integrating the security to the data but right now the fastest growing customer vertical is small to mid-size businesses because it's easy for them you just switch it on within a matter of 90 minutes including the user training so i would say our you know the largest customer segment is small to mid-sized businesses okay but help put put a seat i understand you have a small one at 10 seats and a big one at thousands of seats but your sweet spot is what 200 300 seats on average that's correct it's i would say 100 to 200 seats 100 to 200 seats is sort of your sweet spot okay got it that makes sense let's put all this on a timeline when did you launch the business what year so the business foundation of the business was to 2019 it took us two years to get the product to be very simple you know transparent fully transparent and integrable to any kind of platform so we have literally kicked off our poc program i would say last year so we have been around distributing the product signing partnership signing customers about for a year right now oh what's going on there youtube good to see you guys now imagine this you love watching these interviews with sas founders but imagine if we took all of the valuation data out from over 2807 interviews i've done manually saves you a lot of time well we've done this we've built it into the beautiful interface inside of founder path check this out i'll show you how you can access this in a second but you log in you connect your stripe account you see your valuation real time you can see what it changed over the past 88 days and even set goals for valuation this year now the secret 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there all right let's jump back into the interview okay for a year that's fantastic how did you fund the business when you were pre-revenue for two years did you raise yes i did we had a pre-seed round there was quite a bit of interest in fact there were like four major vcs that funded our pre-seed round and then we switched to ac plus what we called a c plus how much how much was the precede the precede was uh close to one and a half million dollars and that was in 2020 that was in yeah 2019 that was in 2019 okay okay and sorry i cut you off go ahead and keep going no that that's supported our product development and getting the product to a level where it is so simple that it becomes a no-brainer to deploy and after two years we have uh raised the seat plus round which is a little north of three million dollars and we are currently on that round on that spawning ground and we are we have the detraction yeah go ahead okay got it so you've raised 1.5 back in 2019 you currently have an open seed round uh or seed plus round that's around three million that's correct yeah we we haven't exceeded already we have still opening for a few small checks how how much would you raise at the current valuation obviously you're managing dilution here so how much room do you have left correct so we have uh you know 250 000 more left okay so you're basically and the three million's already wired as a done deal right yes oh i see so you leave a little bit open for maybe some strategic angels who come along or something like that but it's pretty much done absolutely yeah that's that's where we are okay this makes sense so about four point you know 4.5 million raised today another 250k left on the current round that's how you funded growth to date um talk to me a little bit more about the team this sounds like it should be very heavy heavy engineering how many folks are full-time today we have 15 folks full time today and growing so again as you have mentioned heavy on engineering and development i'm coming from a technical background myself which helps build the team like i mean you know train even the team from my academic background you know most of my students uh either become professors or get positions in silicon valley but a few of them we based on their skills we you know they're both into our strategy and our you know uh targets and they they stay here at the heartland and contribute directly to us so majority of the team is on the development side technical side but we are also growing on the business side and we have made some very key hires lately on the business development and go to market side lately emery how many of the 15 are engineers uh so um i would say uh 11 of them are engineers and four of them on the rest of the business and growth and customer support site i see now talk us back to the special moment you know you start selling in 2021 you get your 19 you know 20 20 20 21 you get your first customer how did you land that first customer where did you find them oh it was great so it it is one of the largest basically electric car charging organizations in the world and you know they we got the connection and it became clear that the need that they have is in alignment with our value prop so we had a few meetings with them and you know like we have integrated to the platform that they're using the cloud platform that they're using and they have started using it if kind of minor customizations and then boom they kicked it off and it was a great moment it was a great moment you know like that first check was really special i mean to this day i keep it what was the size of that check do you remember so they were paying a quarterly and they started with like a small number of users so the for the first check for that quarter was uh i believe around two thousand dollars that's awesome okay so that's your first customer fast forward to today how many total customers are you working with so we we signed very quickly right now we are over 30 right now i believe it's 30 to 33 customers right now uh we are in the logo generation and quick feedback mode and by the way we also sell through partners that's our main go to market model these include not just you know reseller msp mssp partners but also other tech partnerships as well and we have more than 20 uh uh partnership agreements active to the state and and so how do those work you're paying them a kickback per 16 seat they sell yes based on licenses that they sell you know depending on how they want to join the support model they some of them are highly uh sophisticated meaning they cannot just deploy and sell but also support the customer subsequently so that's a different model that's more like an alignment mspmssp model but uh some of our partners are resellers help with the sales and say maybe take the first call but the support is on us in that situation i see so the folks that are reselling if they sell you know a ten thousand dollar your contract what are you paying them 30 or something is pretty standard correct yeah between 30 to 40 percent that's right okay and are you is that is it 30 to 40 every year in perpetuity or just for year one uh so for real it's in perpetuity so for reasonable and mssps so that's an interesting question because we also have here and there some referral partnerships for referral partnerships which is like hey meet this guy i think they solve your problem and that's that we handle the rest of it it's not perpetual but for the rest of our partners it's perpetual i see i see because there's some effort also needed to kind of renew the contracts and so on and so forth so they are helpful in every stage of the way i see i see and and you mentioned earlier so the average the average team is signing up 100 seats i mean is that true of your 33 customers today on average is about 100 seats per customer on average yes but there's high variability as i have mentioned yeah yeah but there's about 3 300 paid total paid seats though it sounds like something like that correct that's correct yeah but it sounds like again there's a lot of concentration because you mentioned some of your customers have over a thousand signups so somewhat one customer makes it more than a 30-year total business right now that's cool so there's there's indeed like there's elephant there's their mice and you know yeah depending on detailed heavy tail distribution as you have mentioned that's awesome now if we take 3 300 paid seats at 16 bucks a seat it would put your revenue at about 50 000 a month right now on revenue is that about right so that's about right but again as i said we are like a partner based model and early on until we came up with the current pricing model we had tried different pricing models so it's a little uh lower than that amount right now i see so maybe more like 30 000 a month something like that perhaps yeah i mean on average we are at that you know i would say lower six digits error level right now and again the current round has been about the or the former round and as we move on to the current round we have been more about uh addition of logos getting feedback and you know establishing traction which we have achieved i'm also probably stating that we have zero return thus far that's fantastic now if you're uh help us understand growth if you're at about 30 000 40 000 a month today in revenue where were you exactly one year ago very close to zero right very close to zero so we have literally kicked off our poc program and started maturing it last year so it's like 20 21 so we were very close to zero at that point maybe uh one or two customers were on board it at the time but we really kicked things off uh uh in i would say at the end of summer 21. uh all the way to here like this third quarter before we wrap up with the famous five last question here most folks today raising seed you know they're selling somewhere around 20 of the business are you sort of in that same range correct yeah it's fairly typical because i mean um one thing to note about that though is uh the current round that i'm raising is convertible note based so uh you know we are definitely targeting that or is it uncap is it uncapped or capped it's kept okay so it's capped around around a 15 around a 12 or 15 million cap something like that right now is eight million okay eight million cap so i mean you're selling you're selling a very large chunk then i mean you're selling 30 35 of it that's a lot of dilution that i mean one would think that way but you know everybody is on board right now for the long run and we are here to make the team successful make the organization successful everybody is on board and as we onboard highly strategic very important investors everybody is ready to take the uh proper haircut as we move forward and are you the sole founder or you have a co-founder i have a co-founder so okay yeah and were you guys just you split it evenly at the beginning or was it lopsided no it's it's different i'm the main founder he's the co-founder so he was my former student we started building the technology together then you know i have moved forward to you know found the company and he joined us a few months later but uh so yeah so it's it's like a founder co-founder kind of a separation understood so you own you know 60 70 the majority you know he owns less and then you've been diluted with the two rounds so far that's that's that's that's i see very cool impressive no churn you're 33 customers you're on you're on a tear here we're excited for you let's wrap up with the famous five number one favorite book favorite book is uh uh actually uh there are many favorite books i have been pleasantly surprised with david lindley i haven't i don't know if you have heard of david lindley uh he's the physicist from uh uh uk and uh you know basically he's uh authored a fantastic book on uh you know the universe the uh the dream universe is the name of the title of the book by david linkley and you know like i love what grain minds have gone through toward understanding like the mechanisms of the universe and that's my new favorite book great uh i'm we're out of time here so rapid answers if you can number two is there a ceo you're following or studying ceo that i'm studying so uh i mean there are some classical answers to that i mean i the answer would be no but elon musk basically lately said you know like hey you should uh you know what you should focus on as a ceo these days have shifted you know he's basically rightfully saying it's mostly on spreadsheets and you know finances you should focus more on more uh on building the best product that's out there and i have been i mean uh you know uh sympathizing with that position quite a bit got it makes sense all right one more answer on this one favorite online tool favorite online tool uh uh we are using myro myro good number uh number four how many hours you sleep to get every night i say it again sorry how many hours of sleep every night oh that's a very tough question i would say around five and a half hours okay fair and what's your situation married single kids i'm married i have two daughters uh great that's awesome and how old are you i am 46. last question something you wish you knew when you were 20 something i wish i knew as oh it's a long journey it's a long journey so it's never too late for anything so it's a long journey and take your time digest and basically you know a year if you have a task let if it lasts for a year longer it's not a big deal just make sure that it's done perfectly guys anchor my data helps keep you more secure he has many patents he's ex mit he's got the engineering chops 15 folks on the team majority 11 of them are engineers they passed 2 000 bucks a month in revenue about a year ago now we're 30 000 bucks a month across 33 logos that pay on average 16 per seat they on average sign up with you know call between 100 as sheets but biggest customers over a thousand seats on the platform their first customer he landed was back caught in 20 late 2020 which was an electric car charging effectively company uh now scaling nicely with a three million dollar seed round they're closing right now at an eight million dollar cap so they can hire some key additional hires and continue to drive past 33 50 60 100 logos all right thanks for taking us to the top thanks nathan for having me my pleasure one more thing before you go we have a brand new show every thursday at 1 pm central it's called shark tank for sas we call it deal or bust one founder comes on three hungry buyers they try and do a deal live and the founder shares back end dashboards their expenses their revenue arpu cac ltv you name it they share it and the buyers try and make a deal live it is fun to watch every thursday 1 pm central additionally remember these recorded founder interviews go live we release them here on youtube every day at 2 p.m central to make sure 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