Leore + Lob: Aim for a lofty goal

I heard in passing Leore talk about his goals for Lob.

• Getting to IPO by 2024.

• Hitting $100M ARR and making some aspects of revenue consistent.

• Owning 10%+ of the company at IPO, ie, a revenue focus.

It made me dig some more into the back story. Some high points:

• Founded by Leore Avidar, Harry Zhang (Go blue!) in 2013.

• Leore was a tech PM previously at AWS (studies Bezos) and a derivatives trader at Citi.

• Aha came when it would take 60-90 days for a physical mail campaign, but 60-90 mins for an email campaign.

• Builds RESTful APIs for developers to send physical mail.

• "Saas+" model, ie, monthly recurring + metered pricing (~$0.40/mail)

• As of July 2019

  • Employees: 83

  • Total funding: $25M

  • ARR: $40M

  • ARR breakdown: 5k customers on self serve plan at $180 ACV (long tail of developers). 600 customers at $50K ACV (going up to $4M ACV).

  • CAC: $13K

  • PBP: 4 months ($50K/ $13K)

  • Net cash flow: -$400K/mo to +$400k/mo

  • Runway: 5yrs

  • Growth: 2x- 3x/ yr

  • Retention: 98% (for legal compliance mail), 80% (for marketing mail)

  • $ expansion: 140%, ie, someone who spent $1 last year will spend $1.40 this year.

  • Net revenue retention: 120% (140% expansion - 20% churn)

• As of July 2021:

  • Employees: 294

  • Total funding: $82.3M

• Real customer: after 3 months of usage

• First customers: From 'backyard'. YC community. HN brought in Oscar Insurance and a few other enterprises. Hustled their way into Microsoft since Harry worked there.

• Growth levers: SEO, tradeshows, webinars and dinners. Topic: "Innovation in direct mail".

• Goals before going public: $100M+ ARR. Higher quality revenue, ie, less volatility in some aspects of the business.

• General goals:

  • Build a large company. So preference for attracting more capital rather than buying out existing shareholders

  • Hover around profitability (assuming like Amzn since he's a fan)

  • Journey, culture and people