Entrepreneur and engineer Renaud de Gonfreville recently sat down with the GetLakta team to discuss the impressive rise of B2B omnichannel SaaS platform Ziwo. Founder de Gonfreville discussed his passion for building companies around tech solutions, his decision to remain bootstrapped at the beginning of his journey, and the point when he decided to seek funding. Nathan Latka revealed why he estimated Ziwo’s value at a 30-40X multiple today.
Renaud de Gonfreville and his partners launched a custom software development agency ten years ago and then pivoted to launch Ziwo in 2017. The company filled a void in the emerging markets as a cloud-based front-end call center software that connected to CRM solutions.
- Team of 50, with 25 engineers and 10 hires to come
- 350 customers with up to 900 agents each
- $10m ARR
350 customers in emerging markets
Ziwo is a solution specifically developed for emerging markets, noted founder de Gonfreville. The company serves the Middle East, Africa, India, and Pakistan. While there are many similar solutions in Europe and the US, Ziwo took on the challenge of developing cloud telephony and hardware for this market. “That layer is the hardest. It’s like a mix of Twilio and Ring Central,” explained de Gonfreville. As a result of their efforts, Ziwo quickly grew to an impressive 350 customers, each with multiple agents.
Basic pricing model starts at $109 per month
While the standard basic pricing plan for Ziwo starts at $109, de Gonfreville admits that the pricing had to be adjusted and discounted to align with the emerging market expectations. Although Latka guessed the discount-adjusted price would be offered at $50 per month, de Gonfreville surprised him by revealing that the average price paid is $85.
SMBs at $1,000 to enterprises paying $600,000 per year
Ziwo’s 350 customers range from SMBs paying the minimum to enterprise organizations paying $600,000 per year. De Gonfreville explained that Ziwo started with a focus on SMBs and quickly expanded its reach to enterprise-level businesses. “Our largest customer is in the real estate business, which is very big in emerging markets. They use Ziwo to support their 900 agents for the lead gen process,” he revealed. De Gonfreville shared that Ziwo serves thousands of agents in total.
Pivoted from $1.5m custom software development agency in 2016
Founder de Gonfreville started his business as a customized software development agency ten years ago and grew it to $1.5m in revenue in 2016. The company predominantly developed on-premise and customized software solutions. In 2017, he launched SaaS cloud-based Ziwo as a bootstrapped solution while smoothly pivoting and phasing out the service business. Because of the SaaS model, they quickly began to earn profits from SMB customers and later expanded their customer base to reach enterprise businesses. Founder de Gonfreville and his partners completely shuttered the service business within 6 months of Ziwo’s launch.
2X annual revenue to $10mm ARR
One year ago, Ziwo’s ARR sat at an impressive $4.5m. Today, de Gonfreville’s ARR surpassed the $10m mark. He noted that they are continuing to target 2X growth annually. Founder de Gonfreville explained that a big part of their revenue is from the cloud telephony portion of the product. “There is big volume in the calls,” he added.
Raised $3.3m in two rounds
Founder de Gonfreville explained that the lean, super cash-efficient company finally raised its first round of funding of $2.2m in October 2019 and added another $1.2m to bring the total to $3.3m over two rounds. De Gonfreville and his experienced team are focused on remaining cash-efficient and lean but noted that they needed the incremental cash infusion to test some sales and marketing strategies to accelerate expansion and growth.
Latka estimates Ziwo’s valuation at $300-400m
To date, Ziwo is doing $10m in ARR, with $3.3m raised. According to de Gonfreville, the three founders still own “way over 50%” of the business. In today’s market, Latka estimates the valuation of Ziwo at a 30-40X multiple of $300-400m. The large multiple and the total figure delighted de Gonfreville.
Bootstrapped beginnings slowed initial growth but allowed for experimentation
Founder de Gonfreville explained that the decision to bootstrap may have limited the company’s ability to accelerate growth initially. But, he explained, that approach gave the company time to experiment and find the right product-market fit and drive revenue. “If we had gotten seed money, we would have had to move quicker but may not have made the right choices,” he noted. “Instead, we started healthy by getting paying customers.” Ziwo passed $1m in revenue in mid-2018. As if he was thinking aloud, de Gonfreville added, “Maybe it took a few years, but I don’t know if the market would’ve been ready any sooner.”
Expanding Headcount from 50 to 10
What’s next for Ziwo? First up is to expand the headcount from 50 to 60. Of the current 50 team members, 25 are engineers. Next, since Ziwo has successfully tested the viability of emerging markets, the company is preparing to open up additional countries. De Gonfreville believes the time is ideal for emerging markets, which are 5-10 years later than major markets. He sees the demand for call center software in emerging markets picking up, so he’s using the cash investments to accelerate growth and help differentiate themselves in the market.
Famous Five with Renaud de Gonfreville
Although Ziwo engineer and founder Renaud de Gonfreville passed on the question of his favorite book, he lit up when asked about his CEO to watch. Renaud is a self-proclaimed huge Elon Musk fan because of his style of making a lot of noise. “I’m a big fan of bold, crazy guys who go for the moonshot,” he exclaimed. Renaud also enjoys old videos of Steve Jobs focusing on product innovation. His favorite online tool for helping his team build Ziwo is, not surprisingly, Zapier. Renaud sleeps a solid 7-8 hours per night. He is married with 4 children and is 52 years old. He wishes at 20 years old that he would have known you could build a profitable B2B SaaS company.