Acquisition #11 - Journey.io (aka Don't Stop Believing)
Lots of journey puns so sorry in advance.
A little over a year ago I tried to raise a discretionary capital fund by putting all our assets into 1 company and selling shares of that company ... nobody wanted in
Which is really too bad because we 10x-ed 1 and 8x-ed another company. Would have been a good investment!
Then a few months ago we decided on a different model I called the Flip Fund:
The idea is simple:
- buy a biz
- try to double it
- sell in 12-24 months
Investors really liked the idea of a 12-24 month "fund" horizon. (I know it's not a fund, it's more like a fundless sponsor, we stole this concept from real estate folks).
In about 3 weeks we soft circled $650k mostly from the lovely folks that read this. And shortly there after we actually closed a little over $500k from 11 people and put in $50k ish ourselves for a total of $550k. Awesome! For those of you wondering like i did how tf you raise $ in a few weeks ... well the answer for me was write a blog for 3 years weekly, sharing in public, and have a great track record. That would not have been the answer i wanted to hear either 3 years ago but proud we've carried on this long!
It took us about 2 months to find the right deal for the fund. I absolutely did not want to buy something just to buy it. We were looking at a deal that I didn't really want to do. Financially I think it would be okay but it just didn't fit the story we're trying to tell nor did it operationally feel like a good fit ... That's right when journey .io showed up at our doorstep!
Journey.io (YC W21)
Journey's site describes itself as a storytelling product. That might be true but really it's a sales tool. I don't think that demeans it in any way. So yes, our first growth opportunity is tackling a potential positioning problem ... I haven't met a sales person that goes around and says they're not a salesperson but a "storyteller" (and I live in LA where everyone is a storyteller lol).
So it's a sales tool that let's you create a one-pager for a customer. You can embed tons of stuff like a notion page, or todo lists to help coordinate a deal. It's a different kind of personalization at scale.
Journey.io sales personalization at scale
There are a couple of features about this business I love:
- It's f*#$%ing beautiful. Founding team spent $1.5M getting Journey where it is today and it shows.
- Customers LOVE it.
- Retention is damn good.
- Organic growth is okay
- Almost no push made so far to monetize
There are a few other features I like about this space:
- While PLG is taking over, at a certain point larger customers with multiple stakeholders need hand holding to close a deal. I don't care if you're PLG, if you get a big prospect, you treat them like royalty and Journey is a great way to make sure a customer feels taken care of and more importantly you can provide a resource to help them go sell the tool internally.
- Yes people more and more want self service, however larger deals are always going to require some human touch, that's just how larger ticket items are still sold. I don't think that changes anytime soon. Are there exceptions? Of course, but journey is selling to the middle of the bell curve.
The business is currently doing about $18k of MRR and we see a path to doubling it in the next 22 months. It's going to be a grind. I doubt in this environment we will see any easy wins but we're going to use our playbook and start experimenting as soon as possible.
Looking forward to Journey's journey!