If you are following the startup ecosystem closely then you might know that there have been long discussions about the founder’s salary, equity division, and revenue in startups. No individual or startup has ever disclosed these to the public.
But Frrole, a Bangalore based startup which helps brands to discover and analyze their social media presence have gone beyond this trend and has publicly disclosed everything that none ever done.
The details were posted by Amarpreet Kalkat, the founder of Frrole.
The founder equity before the seed round raise was divided as 60:20:20 between the three cofounders – Amarpreet, Nishith and Abhishek (Amarpreet had started, Nishith and Abhishek joined in later). 2.5% of it was issued to Rishab Malik, our lone advisor + part-time team member, before the seed round raise.
In the seed round, we raised $245K at a post money valuation of $1.065 million. It took us 4 months to get the money into the account (around end of March 2014) post the verbal agreement on the investment. I still continue to wrap up some last vestiges of the seed round paperwork and record-keeping, so one can say that funding rounds take a bloody long amount of time. (In all honesty, I must however add that partial responsibility for the delay post March lies with me)
Post the seed round, investor own 23% of the equity, 10% of it lies in an Options Pool, and the founders (+ Rishab) own the rest, in equivalent proportions.
Post the seed round, the cofounders draw an annual salary of INR 12 lacs each (It works quite well for a single guy in Bangalore, and just about works for a family man).
While monthly figures make a fast growing startup look a lot prettier, we believe that quarterly averages are more appropriate indicators of overall growth than monthly numbers.
Our Jan-March quarter revenue was ~ $8k, putting us at an ARR of ~ $30K. Our April-June quarter revenue was ~ $19k, putting us at an ARR of ~ $75K. Our July-Sept quarter revenue was ~ $21k, putting us at an ARR of ~ $85K. We had a bad quarter there, visibly, although it was largely expected (on account of the end of Indian General Elections).
Already a few weeks into the Oct-Dec quarter, we are seeing a clear resurgence with more than 80% of our pilot customers coming back to sign recurring deals, and we are looking at guaranteed revenues of ~ $60k for the quarter putting us at a worst case ARR of $240k, with half of the quarter remaining. Our goal for the quarter is to get really close to an ARR of $500k.
As per Amarpreet this will help the company to build a good organization culture, create a respected brand and bring the best people to be associated with trust and confidence.
This is indeed the first and biggest move by an Indian startup company. Can we expect other companies too to be this much transparent to its customers?