Tradeshift $190m Raised, 150 Customers, $60m+ ARR for Supplier Management

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Many large companies have 1,000’s of suppliers they work with and have to manage at scale. This includes policy updates, tax reporting, and many other items.

Tradeshift, our guest today, helps makes supplier management easy for these large companies.

Revenue and Expansion

Tradeshift has passed $60m in ARR and Christian expects the company to pass the $100m ARR mark in 2018.

Growth has been driven by creating a frictionless experience for customers to onboard their suppliers. Suppliers don’t pay. Rather, flat rate fee to large customers (buyers) averaging $500k ACV. Customers grow to $1m to $1.5m ACV over first 2-3 years.

Expansion revenue is driven through the Tradeshift App Marketplace. # of transactions, # of seats, # of suppliers are utility metrics that make customers pay Tradeshift more year over year.

Christian follows Jerry Chen model on pricing and economics and encourages folks to stay out of the “death zone”:

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View Jerry’s full presentation here.

Why Raise $190,000,000?

Because we have established a direct correlation between market share and capital access. B2B model in this space is critical.

10:00 Sign Easy sponsor placement

Unit Economics

Went from 18 month payback to 12 by decreasing customer acquisition cost. Did this by increasing partnership program. 50% of Tradeshift revenue arrives through partners. This works because partners already have relationship with customer and a sales team to close more deals. They take early cost and give you great revenue.

Example Wipro is an example of a Tradeshift partner that’s killing it. Tradeshift doesn’t pay Wipro because Tradeshift helps Wipro win new customers for Wipro’s consulting platform. Tradeshift supports Wipro in helping Wipro win accounts by touting Tradeshift technology, partnership. This drives 85-90% gross margin for Tradeshift.

 

How did you hit 0% churn?

They’ve only lost 2 logos but these logos were never activated.

Activation is driven by “Supplier Activation”.

The “go-live” point is low point in relationship. It’s where all the bumps happen. We have to activate customers by helping them invite their suppliers as fast as possible and help them get at least 1/3 of the new customers suppliers using Tradeshift as quickly as possible.

Famous Five:

Business Book: Team of teams

CEO I study: Benioff, Jeff Bezos

Favorite tool: Slack

How many hours of sleep? 6-7

Wishes he knew at 20: Christian is 39 today and wishes his 20 year old self would have taken it a bit more easy when he was launching his first company.