Based on $6 million remaining I'm guessing their burn rate is around half a million per month. I'd love to hear how that much money is being spent. Unless there are 30+ employees and significant advertising/infrastructure costs I can't imagine how to spend that much money responsibly in a really small company.
The company is actually 90 people now. Revenues grew 350% over the past 12 months (in a down economy).
We do our best to spend the money responsibly. But, it's all relative. When I was a bootstrapped entrepreneur, even $1 million seemed like a lot of money.
If memory serves, last time I spoke to Dharmesh they were north of 50 employees. I think he's been pretty cautious about ramping spending in relation to growth... But there's always a lag between growth and cash. Time will tell, but I'd bet he pulls it off. He's wicked smart and has done this a few times before.
edit: Dharmesh response with actual numbers (holy crap-- great growth!)
We've actually been good about hiring in proportion to revenue growth (and not getting too far ahead of it). One of the nice things about SaaS businesses is that the revenue is reasonably predictable.
Also, margins are improving as we continue to scale.
Did we need the cash? No, we didn’t need the cash. We had over $6 million in the bank. But, if I’ve learned one thing about VC fund-raising it’s that not needing to raise money helps a lot.
What it helps a lot with are the terms of the deal. If you NEED the money to keep your company afloat investors are going to put the screws to you for a much lower valuation.
