Rosterfy is a SaaS and consulting firm that connects communities to events and causes they’re passionate about, solving complex contingent workforce management problems for the largest organizations in the world.
Clients include the Super Bowl, the city of London, the British Heart Foundation, and many more.
Growth has been impressive, despite the complexities of the pandemic and how it has affected the events and industries that rely most heavily on short-term contingent work.
- Current team size of 23, with 7 engineers
- MRR of $150,000 currently
- Raising 4.5m on a $30m valuation
Since its founding in 2015, Rosterfy has seen steady and sometimes explosive growth, and the company is poised to continue this growth after securing an upcoming round of funding.
Rosterfy’s journey to this point is worth evaluating first of all.
Rosterfy’s Path to Hitting $3.2m in Annual Revenue with $2m ARR
Rosterfy has seen steady growth in each of the last four years. ARR in June 2017 was $500,000. By December 2019 the company more than tripled ARR to $1.6m. A year later in December 2020 ARR was $2.1m.
Revenue for 2021 projects to be $3.2m, with $2m of that in ARR from the SaaS component of the business and the other $1.2m from consulting and support as part of a SaaS-plus model.
Revenue growth has stayed strong despite a pandemic that has affected the sorts of events at which contingent workforces are commonly utilized, a testament to the value of the Rosterfy platform.
$1.2m in Consulting As Part of a SaaS-Plus Model
In addition to Rosterfy’s ARR from SaaS customers, the firm pulled in $1.2m in additional income. Rosterfy operates on a SaaS-plus model, working on significant enterprise contracts with ongoing support needs.
Clients in this sphere include the Commonwealth Games and FIFA.
In the largest applications, Rosterfy requires ongoing paid execution and support, with some of the largest clients requiring one or two FTE to keep the system going. This revenue is currently included in the $1.2m figure rather than the ARR, though it will continue occurring for the life of the SaaS contract.
Rosterfy Brings 4 or 5 Disparate Systems into One End-to-End Solution
Larger organizations require massive workforce management, especially for short-term or contingent needs. Many still rely on spreadsheets or significantly outdated tools requiring high amounts of manual work.
Rosterfy offers an end-to-end modern SaaS solution to contingent workforce management, covering all aspects of the process, including these:
- Time and attendance
The Rosterfy platform pulls into a single system disparate functions that might have taken 4 or 5 separate systems in the past. By unifying all these functions into a single cohesive interface, Rosterfy greatly simplifies and streamlines contingent workforce management efforts in nearly any setting.
How Rosterfy Scaled from 100 to 130 Customers
In around one year’s time, Rosterfy has scaled from around 100 to 130 customers in total. CEO Shannan Gove credits that growth to the effects of COVID, during which time Rosterfy has seen growth from larger customers in need of streamlined and powerful solutions.
In focusing on larger customers rather than a mass of smaller ones, Rosterfy creates an impressively high average customer value.
97% Retention Rate Month to Month
While churn rate for SaaS firms can be a significant concern, Rosterfy has avoided much of this. The company boasts a 97% retention rate month to month, which works out to a 36% annual churn rate. Rosterfy has successfully outpaced that churn through new customer growth as well.
Rosterfy Bootstrapped Until a $1.6m Pre-Seed Round in 2019, with Significant Growth Since
The company was bootstrapped from its founding in 2015 until 2019, when it raised $2m AUS ($1.6m US) in its first round of pre-seed funding. At that point, the company relied more on consulting and support revenue and has since shifted its focus to recurring revenue through SaaS contracts.
The current cap table for Rosterfy has a 78/22 split between the company and investors, with 68% of ownership remaining between the three company founders and 10% in an employee stock ownership plan. The previous round of investment holds a 22% stake.
Seeking $4.5m in Funding to Continue Expansion into Enterprise Market
Rosterfy’s beginnings were in the volunteer and mass workforce space, but in the past two years, the company has focused on the larger contingent workforce space, working with larger and larger firms and municipalities.
As the company moves into a larger market and offers support for larger groups of contingent workers within those larger clients, both opportunities and costs increase. Rosterfy looks to increase its sales and marketing budgets as well to continue its penetration into this market.
Rosterfy Targeting a Valuation North of $30m
With its aggressive expansion on the SaaS side of the business, Rosterfy is targeting a valuation north of $30m in this current round of funding. With demonstrable growth both in the number of customers, the size of those customers, and in ACV, plus plans to expand into multiple physical offices once Asia Pacific COVID restrictions allow, the company is poised for explosive growth in a largely untapped market.
$250k in Marketing Spend for 2021
According to co-founder and CEO Shannan Gove, Rosterfy nets its largest clients by direct sales thanks to its internal six-member sales team. But midmarket opportunities typically arrive through marketing spend.
For 2021, Rosterfy is spending $250k in marketing efforts, including SEO efforts and content on LinkedIn and Google. The company has also sponsored some campaigns and invested in advertising.
Gove views this spend as setting the foundation for expanded efforts — and expanded growth — in 2022 and beyond.
$15k ACV with a $1,200 Monthly ARPU
As a complex SaaS platform, Rosterfy enjoys a significant average contract value of $15,000. With an MRR of $150,000 and 130 customers and counting, the average revenue per user lands at around $1,200 per month.
Rosterfy has seen growth in these numbers even over the past nine months. MRR has grown by 50% since December 2020, when it sat at $100,000. And ARPU is up as well, going from $1,000 to $1,200 in that same time period.
As the company continues to scale, revenue growth depends on quality more than quantity, as each client company represents a significant amount of revenue.
The Jump from a $6m Valuation to a $30m+ Valuation
At first glance, a jump from a $6m valuation to one north of $30m in just a little over two years might seem aggressive. But this jump is reflective of the growth the company has seen in this time period — despite outside economic and logistical pressures that could have impeded that growth.
Several outside consultants have suggested a valuation level of 10x ARR, which fits this target valuation when considering the ongoing consulting and support revenue that is de facto tied to SaaS contract ARR.
Gove recognizes both the challenges and opportunities facing Rosterfy as it continues to scale. As the company seeks this new round of funding, he and the team continue to lay the groundwork for rapid expansion thanks to the infusion.