Adam Torres and Randy Woottona discuss Maxio.
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Show Notes:
What are the key factors SaaS CEOs should focus on to balance rapid growth with operational efficiency? In this episode, Adam Torres and Randy Wootton, CEO at Maxio, explore Maxio and trends in B2b Saas market.
About Randy Wootton
Randy Wootton is a GTM executive who has been helping marketing, sales, and FinTech companies develop and scale their SaaS capabilities for over 20 years. He currently serves as CEO of Maxio – the leading provider of billing and financial operations solutions for high-growth B2B SaaS companies.
About Maxio
Maxio streamlines financial operations for B2B SaaS businesses by automating complex billing requirements—from rating and invoicing to reporting and analysis—within a single, unified platform. Maxio’s mission is to equip businesses with the tools needed for flexible, sustainable growth in a constantly evolving market. Whether a business is product-led or sales-led, generating $1M or $100M+ in ARR, Maxio helps unlock the next stage of growth.
Full Unedited Transcript
Hey, I’d like to welcome you to another episode of Mission Matters. My name is Adam Torres, and if you’d like to apply to be a guest in the show, just head on over to missionmatters. com and click on Be Our Guest to apply. All right, so today I have Randy Wootton on the line, and he is CEO over at Maxio.
Randy, welcome to the show. Oh, it’s my pleasure, Adam. I look forward to the conversation. All right, Randy. So we, got a lot to talk about today. Of course, I want to get into Maxie on what you’re doing. I understand you process over 17 billion in volume annually. so we’re going to get into this and I want to talk about maybe some of the other things you’ve done.
I know you work with other , big, high growth companies like Rocket Fuel and Percolate. So we got a lot to cover, but to get us started here, Randy, I’m just curious, did you get started in this space? Like, where did all that begin for you? Oh my gosh, it’s been a while. I joined the Interweb back in 1999.
I joined one of the first agencies at the time, a digital agency called Appway that eventually became a quantum and sold to Microsoft at six billion dollars and Was it called a digital agency back then? I’m curious. Was it called a digital agency back then? Did they have that term? Yeah, I mean, I, you know, it’s been a long time.
I, we were talking about digital advertising at the time and it was a small little, you know, small little bucket of funds that people were experimenting with. And then we, it, that, that online advertising grew to outpace TV in terms of overall spend. And so it’s been an incredible journey to watch.
Back then, we were, I was working on the technology side of the agency. Which became a division called Atlas DMT and we would call it web based ASP, application service providers. And it was Mark Benioff at Salesforce who, you know, brilliant marketer that he is. He talked about it being SaaS and from the cloud and he made it all sexy.
I was there, you know, back when it wasn’t sexy. We were trying to figure out how to do distribution of software to people via the internet. I love those early stories because just to give our, our listeners a little bit of a taste of what that was like before. That’s why I asked you. I’m like, did they call it that back then?
I knew you’d give me something and I figured let’s bringing it a little bit more present day Maxfield, I guess, as we go further into that piece of the conversation. I mean, tell us a little bit more of the company overall. Yes, at the end of the day, we’re a system of record for billing and invoicing and for early stage founders, they’re trying to do, you get the product out the door and they’re trying to find product market fit.
And at some point they want to get paid. And so they have to set up some type of billing structure. And that can be either. You know, billing or what we also call support or invoicing. And the core of that, Adam, is that the billing and invoicing data is the lifeblood of the company. It’s what tells you what’s going on.
And so if you’re trying to raise money or manage your business, that data then can be converted. Converted into operational metrics. And so in the SAS space, you hear a lot of people talking about things like A. R. R. annual recurring revenue or gross retention or net retention or L. T. V. The cap. They have all these metrics they use to better understand what’s going on with their with their overall business, their go to market efficiency, their customer success motion and All of that really is rooted in the billing and invoicing data.
And so we think of us as like the heartbeat of the SAS company. And so we do billing, invoicing, rev rec and reporting. And we just announced yesterday, actually the acquisition of a CPQ company. And so now our focus is on helping to provide insights from order or offer all the way to cash. So if you’re doing a sales led motion, or if you’re doing a PLG motion.
How does a customer sign up and and buy your product? How did they get instantiated? How did they get invoiced? And then you as the business owner using all those insights to better understand what’s working by product by segment by region. Mm. What are some of the what are some of the key factors that SaaS CL should be focused on, especially when they’re going through rapid growth?
I mean, because you, again, you have a unique vantage point with the amount of clients you’re dealing with. I mean, the amount, even the volume, 17 billion. I mean, , what should they be focusing on? Well, I, I’d say two things. One, I don’t think I realize how much money is lost because of not having accurate billing.
So that can fall into two categories. One is you’re just not billing. Number two is you’re not billing accurately, and your customers are contesting the bill, and that’s called revenue leakage, and there are analysts out there that say seven to nine percent of your revenue, so seven to call it ten cents of every dollar, you’re not collecting because of issues with your billing system or your process, and it’s just mind boggling, you spend all this money to hire a customer, get them in the door, get them up and running, right, and at the end of the day, you’re not collecting the dollars.
And so I think CEOs, a lot of the, you know, I deal with B2B SaaS companies, almost exclusively they’re technologists, and they don’t care about back office. And one of the things I would say after You know, I’ve been a public company CEO, private company CEO. This is a PE gig. I sat on a couple of boards is for CEOs, early stage founders, CEOs to think broadly across the entire system from front office to back office and try to think about how do you, how do you bring forward the technology, your, the systems, In a concurrently, it’s don’t wait until you’re 1, 000, 000 or 2, 000, 000 company before you start thinking about back office is how do you think about that order or offer to insights, the offer to cash process and and build out the appropriate systems and, you know, hire the right people.
So I guess taking it a step further, how is, how is Maxfield helping to address these, these issues? Well, again, it’s sort of a system of record. What we do is we, eliminate spreadsheets. We eliminate the error. So with our new acquisition rev ops, people entered the CPQ the order either into like a Salesforce or HubSpot.
And now there’s no manual Processing of the data. It automatically gets ingested from the CRM, the CPQ into through Maxio into your general ledger. Most early stage companies are using QuickBooks online in the U. S. or zero in Europe, and that becomes one workflow. So all of those steps are captured and so then the invoice that you’re issuing is tied directly to the order that was signed.
, I can’t tell you how many companies I work with, the CEOs I talk about, or CFOs I talk with, who are like, it drives them absolutely back. Crazy that they can’t figure out what’s going on with the contracts and the salesperson added a special this, or they threw in a professional service here, or they come up with their own pricing.
Right? It’s like, you’re trying to standardize thing at the same times. You want to be. Flexible for customers who want to buy differently than how you’re selling. So you have this real tension between trying to create flexibility and customization, but then also standardization. So you can do the reporting and you can actually run your collections on the backend.
So we also help with collections and we have a payment solution. So think of it like a, a platform. We call it Billing Automation and Revenue Management. We help you with the billing, we automate the billing, and then we help you with that revenue management. We’re the source of truth for the billing invoice data, which allows you, in SAS, because of deferred revenue, it allows you to manage your revenue and know what’s going on.
What is what have you found? Like what type of either size of company or otherwise is it revenue? Like who gets, who typically gets the most value out of working with you and your team like over across the board? Yeah, I would say our target is between about a million and 40 million. And I think it’s.
Like there’s these different inflection points. If you’re under 30 employees, you probably have Bob, your uncle doing your books and you’re doing cash accounting. And then at some point you’re like, Oh my God, I need to raise some money. Go out beyond family and friends. You’re looking for some angel investors.
And they’re like, no, if you’re a B2B SaaS company, you really need to be doing accrual accounting and you probably should get a fractional CFO. And so it’s right at that transition point where you’re not managing your books through your. Your bank account. You’re actually trying to do accounting that we can add a lot of value.
I would say the other thing that’s interesting is in this new world. One of the big trends we’ve seen in the people are interested. We’ve launched a couple of state of the industry type reports because we have 2000 plus customers. And so we have a bunch of detail on what’s happening. Brought into the billing and invoicing data, right?
It’s real. It’s not survey data. It’s quantitative data from there It’s anonymous, but we’ve aggregated it But people can find that report on our website maxio. com and gives you all the trends of what’s going on And so one of the things you’re finding is this it used to be everyone did annual base seat Based type contract.
So you number of users you pay annually and it’s a price per seat. What you’re finding today is a lot of people are moving to a usage based model to better align value with price. So you have a certain number of widgets. Like you’re going to charge based on widgets. You’re seeing this to be especially true with the AI first company.
So when you think about like open AI, they have three different types of tokens they’re charging for and you pay on a per consumption basis of those tokens. Well, you know, that adds just an enormous amount of complexity Adam to the to the whole invoicing, billing, processing Consolidation, like think about it, you’ve got a meter, you’ve got a, what they call a meter, you’ve got to count each of those widgets, you’ve got to rate and then price each of those widgets, you’ve got to aggregate all those, you’ve got to do the revenue recognition, and then you’ve got to consolidate it in an invoice because you don’t want to send your customer a million line invoice, right?
But they want to be able to see the next level of detail. So you can just see, it just becomes this Cambrian explosion of complexity. And I think a lot of. Early stage founders that are trying to jump on the bandwagon of AI and get this money don’t appreciate the nuances of trying to create a monetization strategy, your price and package in a compelling way that customers are going to value and that you can manage on the back end.
Mm hmm. You have a unique vantage point again, 17 billion in volume annually. What, any type of trends that you care to comment on or otherwise in the B2B SaaS market, just in general, that’s helping people stay competitive? Yeah. So we, the one that was just sort of pointing to the other survey that we launched with people can find is we did a, we did a survey on usage based billing in partnership with a guy named Ray Wright at Benchmarkit.
I think it’s Benchmarkit. ai, which again, I recommend to anybody who’s in our, in our space, DDB SaaS, Benchmarkit. ai or Benchmarkit. ai. com or something, whatever it is, but Ray Wright, find him. He has a collection. He does survey data. He has a collection of data, which allows you to. Enter your size company and market and you can get all the metrics that we are talking about.
The standards, the median, the 25, 50, 75, 100 percent for like NRR, gross retention, LTV to CAC, new CAC ratio. So if you want to figure out how you are operating comparatively. Awesome data. We did a survey with him on what’s happening in the state of the state for usage based billing. And what we saw was over the last two years, because we do this every, every year, that the number of SAS companies that are using usage based billing has increased from about 50 percent to 67%.
So there’s been a significant uptake in the adoption of this model. And to my earlier point, It, though, is pretty darn complicated, so I think if you’re not doing usage based billing right now, you should absolutely think about it and explore it and try to, especially if you have a PLG type go to market model, start to really embrace it.
So I think that’s number one. Number two, the other trend we’ve seen, and this is captured in the Maxwell Institute Growth Report I was alluding to earlier, was the earlier stage companies I don’t know, a year, year and a half ago after the COVID implosion, companies less than a million bucks weren’t growing.
So And I think it was because they took capital back in the heady days of 19 and 20 and then the VCs sort of pulled back. And so they really had to move to a model of efficient growth versus growth at all costs, which means you’re solving for EBITDA or trying to cash flow positive, which limits the amount of money you can invest in your go to market.
So I’d say 18 months ago, we started to see a real fall off. In terms of the companies that are less than a million dollars growth rate, this last survey that we did, which would capture Q4 from 2024, so still really relatively current shows that that cohort of customers has grown significantly. So I think that’s indicative that a bunch of new the next, the next wave of investment has been.
Made in those types of companies and they’re, demonstrating more of the classic pattern of growth supported by the VCs. And I think, the good news more broadly is we’re seeing investment starting to happen by the early stage VCs. So I think we’ve, we’ve weathered the winter and spring is coming.
And it’s going to be a great time, especially if you’ve got real AI, not just a cheap chat GPT wrapper to you know, fuel the future of our economy. It’s going to be awesome. Yeah, this is good. This is great stuff. Randy, if somebody’s listening or watching this and they want to follow up and they want to learn more about Max.
You’ll connect with your team or even access any of the reports or anything else you’ve mentioned. I mean, how do people do that? Yeah, so max. io. com. We’ve got a bunch of resources there, as I alluded to. We’re putting out a bunch of content on LinkedIn. I, I’m post, I have my own podcast. We post once a week.
It’s focused on SaaS builders. Wait a minute. What’s the name of your podcast? How did I not even know that? That wasn’t in my intro. Come on, man. I love supporting other podcasts. What’s the name of the podcast you’re holding out on me, Randy? I knew it. You were holding it back. It’s called Sass Builder.
You’re supposed to lead with that. You’re supposed to lead with I got a podcast. Come on, I didn’t know you were one of us. You know, I don’t have the audience you have, so I’m still just trying to figure it out. Nah, we’re all trying to figure it out. I don’t have the audience Joe Rogan has. What the heck?
Who cares? Well, we can get you on our podcast. What’s the name of the show again? I want to make sure we give that some time. Go ahead. It’s called SaaS Builders, and it’s focused on early stage SaaS CEOs that are trying to put it all together and figure out, you know, we bring in analysts, we bring in influencers, we bring in other companies, you know, executives have been successful at multiple startups, and it’s just meant to help, it’s a 20 minute once a week kind of deep dive, and I’ve got people like product experts, I’ve got tech experts, I have pricing experts so all the things I have never been an early stage founder, but I talked to a lot of them and sort of the questions I’m getting through the conversations.
I try to find guests to address them. So that’s it. It’s awesome. Great stuff. Favorite episode. That’s an unfair question, but I love to do it. It’s like making people try to choose between their for their kids. Which one’s your favorite kid? Come on. Tell me Randy. What’s your favorite episode? So I am. Well, I will tell you At least one, maybe two.
My favorite one, there’s a guy, I’m a total book nerd. I was an English major and then I took a Master of Arts in the great books and I taught literature for a while. And there’s a guy who has a podcast, it’s called the CFO Book Club. And it sounds like the most dry thing in the world. That does sound like it’s probably a great niche though, and it’s intense.
Is it or is it not? Totally. It’s so cool. And we totally geeked out and on books and just general business books. But the book that we, he reminded me of was Peter Drucker’s Effective Executive and here why it was so mind boggling for me. I probably read it I don’t know 15 20 years ago, and I’ve been working my own book, Adam, and my book is eight secrets of success for SAS CEOs, and I haven’t gotten it done yet.
I need to get it over the dark finish line, but I went back and read Peter Drucker’s effective executive, and it’s a bit dated. I mean, the language is a bit dated but he already covered everything I wanted to cover. And I was like, Oh, boy, like, I’m, I have nothing here that Peter hasn’t already said.
And so it was just kind of a reminder to go back and I’ve done the great books as you go back. You want to find out what’s happening today. You want to put him what’s been our political scene and how things are playing. Go back and read the Iliad, go back and read the Odyssey. Like I just, you know, there’s nothing new under the sun and it’s all been captured before and it’s just, it’s a wonderful way for me at least to just remind of, we’re part of a continuum.
Hmm. Yeah, I’d love it, man. It’s great stuff. Let’s leave that website one more time about Maxo. That’s awesome. So it’s, the Maxo website is maxo.com. Yep. And then people can also just find me on LinkedIn. Last name is Wooten. W-O-O-T-T-O-N. Mm-hmm . And if they’re, if they have a specific question, I’m always open to doing, you know, 15, 20 minutes, you can just reach me at [email protected].
Happy to send a call. Chat about whatever you’re interested in. Amazing. And for everybody listening, just so you know, we’ll definitely put some links in the show notes so you can just click on them and head right on over. And speaking of the audience, if this is your first time with Mission Matters and you haven’t done it yet, hit that subscribe or follow button.
This is a daily show. Each and every day we’re bringing you new content, new ideas, and hopefully new inspiration to help you along the way in your journey as well. So again, hit that subscribe or follow button. And Randy, really appreciate you coming to the show. It’s been a lot of fun. Yeah, it was my pleasure.
Appreciate it.