Once upon time…
Maximilian Messing and Sven Lackinger met each other during the first week at university and immediately connected. Since then, they spent most of their time at university as roommates. They were studying business at WHU in Germany and started their first startup called Evopark together with two other classmates, right after graduation. It was based on a course about Entrepreneurship they took during their masters. Evopark was a payment operator for car parks. They ended up in the German version of Shark Tank, raised money from Porsche and built many car integrations to make parking easier for people. The company was acquired back in 2018 by the Scheidt & Bachmann Group. After that, they both stayed on board for about two years, focused on integrating it into the group and working on projects around the world on seamless parking technology.
However, both Max and Sven were still eager to build and decided to jump on a new startup endeavor in 2020. They were looking into combining their skills, namely Max’s skills as a CTO and Sven’s commercial skills. They realized they were experiencing the same problem they now solve for companies around the world: “Max always liked to mention how he was spending a ton of money on software tools, and I was running after him trying to figure out what we were spending money on.” They figured it was worth researching to what extent other companies had this issue as well. They spent the summer of 2020 researching how companies procure software and identifying points of friction along the process.
“For us the most important thing was that there is an enormous trend towards SaaS and decentralized buying, there are so many new tools out there and combining the best ones defines how successful a company can operate. So it was really a good mixture for us in terms of the right time to find a solution to the problems just arising. On top, the market is exploding in size. There is basically a new need coming up that will only increase in the future.” They decided to build Sastrify as a platform that can handle the whole lifecycle of SaaS within a company, from the moment a need arises to acquire a software solution, sourcing them, managing the contracts, taking care of renewals, upsells, downsells, etc. “An eye-opener for us was to find out that people are more interested in saving time than in saving money. And so that’s why we built the platform – to really support them in their day to day jobs. We wanted a combination of SaaS, ‘easy’ and ‘simplification’; that’s what led us to Sastrify.”
Something they learned in their previous company and implemented successfully in this one, was getting as much customer feedback as possible – even before building an MVP. They did that in the following way: they went to a lot of companies and looked into their SaaS stack. They learned a lot about what worked and what didn’t work, thereby focusing on where they saw the biggest bottlenecks and friction on the customer side that they could solve.
Only after that whole process, Max built the MVP. This was a platform that offered the minimum functionalities, which were compiling a list of subscriptions and setting renewal dates. It allowed companies to have their accounting data in one place and work with this data in order to figure out how much they’re spending on which tools. Sven and Max tried to sell this product very early on, which provided them with more feedback, this time on pricing. Another important aspect they received feedback on, was why people were not buying. This enabled them to keep finetuning the product As a result, the product quickly matched the wishes of the users even better. “As a founder, you always question yourself and your decisions. The cool part about Sastrify was that the idea makes just so much sense to everyone. With every customer, we get more confirmation on that.”
During the fourth quarter of the same year, they raised 1.3 million in their pre seed round and hired the first people. It took them another six months of experiments every two weeks, with design-defined outcomes, to figure out in which direction they wanted to go and when the right time would be. This was followed by their seed round in which they raised an additional 7 million. The first quarter of 2021 was the moment where they realized that people were way more focused on getting the whole vendor management part solved, than just saving an extra buck. They decided to focus on that; saving them a tonne of time and making the product as easy to work with as possible. That accelerated their customer base substantially, they acquired various big logos and saw strong growth over the subsequent year.
Attracting and retaining customers
Overall, attracting customers was never a big challenge for them, largely thanks to a guaranteed, tangible ROI. From a financial perspective it simply makes sense for companies to work with Sastrify. It was especially interesting for them to get the first, bigger names on board. While their first couple of customers were mostly startups or friends, soon a number of well-known companies like Gorillas, Babbel and Runtastic came on board and allowed them to use their logos, photos and quotes. That made a big difference. For sustainable growth of the company, it was very important to build a long-term customer base. At the same time, however, Sven and Max did a lot of experiments with shorter contracts of less than a year. This was to determine which customers were not a good match with Sastrify and how the product could be further adapted to appeal to a wider audience.
Start earning as early as possible
According to them, one of the best decisions they made was to earn money with it as early as possible. With that, the most important thing is to create value for your (potential) customers. Only then they will pay you. Another good decision was hiring a senior team as senior and as early as possible at your current state, that has done it before and has the experience. Assemble a team that is really focused on the mission. One thing they say they could have done differently, is starting with significant marketing efforts earlier. Until today they feel that they are lagging and underselling themselves. They could be more aggressive in showing what they do and showing that to the world.
Hire for talent, not location
As the company was growing, something else that contributed to its success was going fully remote from the start, which allowed hiring for talent, as opposed to hiring for location. Sven and Max started completely remote as it was in the middle of Covid. This is reflected in the company’s DNA to this day. “It is a fascinating experience, really broadening our horizons every day. In hindsight, it was definitely the right decision, because it allows us to build an international team and really the best talent around the globe. It enables us to hire for talent, not necessarily for location.” It also gives a great mixture of freedom, flexibility and ownership to everybody in the company. Although the model turns out extremely well for Sastrify, personal encounters are certainly not a thing of the past. Every few weeks the team comes together physically, once a year the whole company goes to a special (read: sunny) location and thanks to the unintentionally formed “hubs” in Barcelona, London, Berlin and Munich, several “Sastronauts” see each other still weekly at co-working locations or for a Friday afternoon drink.
Within only two years, Sastrify has grown five times and acquired hundreds of customers around the world within six regions in Europe, plus some customers in Latin America, Asia and the Middle East as well. “We’ve really seen, especially over the last couple of months, people get more accustomed to putting processes in place to make sure they don’t overspend, which is exactly what we do. I think overall, we were able to also assemble more than 160 employees in more than 25 countries. There were many milestones, the latest one raising our Series A with FirstMark Capital in January 2022, one of the best venture capital funds in the world investing in Airbnb, Shopify etc. Also, we have launched in the US in summer 2022 and working with the team and our customers there is great fun. The most memorable moment though was our team offsite with the whole company in Lisbon earlier this year. We are fortunate to experience the wild ride of a fast growing startup with many stressful but rewarding days around the world. Anytime somebody thinks about Software tools in an organization, they should think about Sastrify. That’s how we’ll enable the future of work and how organizations buy their SaaS in the future.”