February 2021 investor update

Dear all,

February was a very interesting month for us. We had three customers churn, we signed two more customers, we continued to hire more people, and we made great progress on all fronts, kicking off our new challenge and completing our first sprint.

KPIs

  • Net Cash Balance: $1.138M in cash and short-term AR (previously $1.156M including short-term AR)

  • Last 30-days cash consumption: $18k

  • Months of run-rate: 63 months

  • GMV managed: ~$1.1M (aggr salaries of talent, annualized)

  • MRR: $31,000 (down from $34,000)

  • Customers: 8 (prev 8)

  • Talent placed: 36 (7 of which we don't manage their payroll)

  • Open positions currently hiring for: 18 (for current customers)

What we've done in the last month

  • In our last newsletter we said we would:

    • ✅Launch our challenge 3, and Sprint 5.

    • ✅Experiment with qualification and profile augmentation for gitsight developers.

    • ✅✅❌ Close 1 more customer. Upsell on an existing customer. Get 3 customers to hire their first developers.

    • ✅ Increase the number of qualified applicants coming from Gitsight and Referral Program.

  • Demand: We closed on three new customers, and grew our business with two existing customers, and lost three existing customers. As a result, our MRR shrunk to $31k and we have 4 customers pending any placements (we don't count their open searches as MRR until we close them).

    • We lost our semi-recurrent customer, we tried to move them to fully recurrent so they had the same model than all of our other customers but we could not make our partnership work - we failed at conveying our value prop to them vs DIY. If they fail on their own (which we don't hope) we may have another opportunity. Learned lesson: stick to your ICP.

    • We lost a customer that had teams in Canada, and where the value gap is not that big. Learned lesson: stick to your ICP.

    • We lost a third customer that had signed an MSA but legal came back and pulled it back. While we could have found a way to figure it out, our talent supply team is stretched too thin to be able to accommodate the specific needs of this customer.

    • All in all, we are very sad to see these customers go but it is part of the journey of finding our ICP and without experimentation we would not be able to learn. 

    • We launched an effort to bring demand that fits with the supply we're seeing. We call this supply driven demand (duh!), we've started to source that in combination with our referral program and prioritizing our pipeline. Expect more about this in future newsletters.

    • We launched an effort to distill what makes up the happiness our customers feel. We're meeting all the relevant stakeholders, oftentimes on a recurring basis, to be able to have granular feedback we can use to better position ourselves.

  • Talent Supply: The current focus is to both fill the open reqs of existing customers while at the same time find scalable ways to attract talent.

    • We placed 2 new people, below our 5 people goal we had for the month, losing three customers didn't help with this as it erased a lot of work we had done during the last 2 months. But at the same time, we feel confident we're aligning demand and supply better.

    • Talent Scalability experiment 1: We've launched a developer referral program, and embedded it into our communications with them and integrated the program in our Remotely Network. We've already received 16 referrals from existing developers. 2 of these referrals are now far in the recruiting process.

    • Talent Scalability experiment 2: We've started running our 200k developer Latam list on ads, and we're getting a good amount of inbound of great developers. It validates Gitsight provides great signal of quality talent, but also checks that we can scale Latam very naturally. At the beginning of the month we were getting 30 developer applications per week. Now we're at 170.

  • Product: we've automated our employee management system with airtable and zapier. As a result, we have significantly reduced the risk of mistakes and pushed back the glass ceiling we were starting to feel in managing existing customers. We will publish a post about this on our substack newsletter soon. We've also started building Supply Management dashboards off the data from our ATS. Next month we will create additional dashboards and a front-end for our Employee Management.

  • We are also testing new mechanisms on keeping in touch with our candidates. An idea we stole from the “are you still there” from Netflix, because we learned that timing is key.

  • We started to do Loom presentations of our candidates to the companies (instead of just a PDF). 100% of the candidates we presented with a video were scheduled for a meeting.

What we'll be doing during the next month

  • 🗺 Launch our Sprint 6 and 7. Create additional dashboards for the pipeline, migrate the infrastructure of gitsight, and create a first front-end to our employee management platform.

  • 🧪 Ramp up our inbound generation efforts for developers, and experiment with our supply driven demand.

  • 🔝 Close 1 more customer. Upsell on an existing customer. Get 3 customers to hire their first developers.

How can you help?

  • Want to join our alpha Ambassador Program? If you're interested, let us know and we will walk you through the steps. We are prioritizing people that know us and are connected to VC backed, US based founders, CEO’s and CTO’s

We look forward to updating you again next month, in the interim, let us know if you have any questions. 

Many thanks,