Update: We Lost Our $2.2M ARR SaaS Business, Rebuilding Now
This is a follow up story for G-71. If you're interested in reading how they got started, published over 2 years ago, check it out here.
Hello again! Remind us who you are and what business you started.
Hello, my name is Sergey Voynov, and I am the founder of G-71. A year ago, we spoke with Starter Story about our company and our product, LeaksID, which is designed to protect confidential documents from photography and unauthorized disclosure.
In simpler terms, LeaksID allows you to share your documents securely, and if anyone takes a photo of the document from a screen or printed copy and this photo appears somewhere, you can identify the person who leaked it. This unique product solves a huge problem, which cost enterprises $7.25 billion last year.
What have been your biggest challenges in the last year?
Oh, it was one of the most difficult years.
We started last year with a great financial result and full of absolute confidence that we will multiply it many times. However, at the beginning of the conflict in Ukraine, all plans and visions collapsed. The original concept of starting locally and then expanding globally, which we began with the Eastern European market, and Russia, was no longer possible.
We had a large development team in Russia and serious revenue in the local market. A fundamental and cardinal question arose: either a local market or a global one. Without compromises and the possibility of combining.
After several meetings with clients and investors, a decision was made - we are shutting down the local business. No more developers, not a line of code, not a cent in revenue from Russia.
A detailed action plan was drawn up, and information resources, key employees, a code base, contractual relations, and hundreds more points that could not be forgotten were identified.
The meticulous work took several hard months and was completed only by August 2022. Oh, how hard it was to part with what I built with such difficulty. But the reality was like this, and I couldn't influence it. I could only make my own choice. And, as not for the first time in my life, I started rebuilding all over again.
Don't forget about your ideas. Their realization is an interesting process, and this experience can make you and the world better, if not happier.
It was not without losses. Unfortunately, part of the team could not relocate, and I had to look for replacements for them. This was the most emotionally difficult part of the process. The success of the company is brought by the team, and finding the right people who share values and ambitions, combined with talent and experience, was by far the biggest challenge I had to solve.
When all processes were completed, I moved to Mountain View, California, where the headquarters of G-71 Inc. is now located. Since August of last year, we have been rebuilding our business from scratch without relying on our previous successes.
Tell us about what you’ve been up to. Has the business been growing?
Well, we had to forget about the $2.2M ARR and start over. We were confident that if we were able to grow up in the local market, which was less than 1% of the global cybersecurity market, then in the US market, which accounts for over 50% of the entire cybersecurity market, we are able to increase our revenue.
Our main focus has been on promoting our solution in the US market and using direct sales tactics.
It was challenging to expect demand for our solution when our target customer CISO (Chief Information Security Officer), was not even aware that there was such a solution to deter photographing and publishing sensitive documents.
Therefore, to inform them about our product, we selected several approaches:
- Advertising campaigns in the cybersecurity community
- Participation in industry exhibitions and events
- PR in profile media
- Active management of our own social media accounts where we talk about technology
- Rebuilding our website and integrating wide SEO activities
In terms of sales, we used direct cold emails, and LinkedIn appeals to CISOs and officials whose businesses could be at risk of sensitive document leaks.
We are thrilled to see that our efforts are paying off. Our success is largely attributed to our unique solution, which sets us apart from others in the industry. When we manage to reach potential customers, especially CISOs, they are often fascinated by LeaksID's capabilities as it is unlike anything they've seen before. This has contributed to our impressive cold email conversion rate of approximately 7%, which is significantly higher than the average of 1-3%.
As our steganographic anti-leak marking technology gains more popularity, we are receiving increased interest from CISOs who recognize the value of our solution but have yet to adopt it. This presents a significant opportunity for us and our partners in the open market, and we are actively working to capitalize on it. Additionally, we recently launched our Early Adopter Program, which enables any organization to apply for free access to the system and all new features as we release them.
We are pleased to witness a steady increase in the volume of deals. Initially, our deals were a small standalone solution for specific tasks and a limited number of users. However, we are currently in the discussion process of full users implementing LeaksID in the largest US corporations from a range of sectors.
What have been your biggest lessons learned in the last year?
One of the most difficult lessons I've learned is that even when we do our best, things can still go wrong. In my case, unforeseeable circumstances like the conflict in Ukraine led to significant losses.
However, it's crucial to find the strength to continue or start anew in such situations. I once heard a quote attributed to Henry Ford: "People capitulate more often than they fail." Well, we roll up our sleeves and anew, with new strength.
A year ago, I faced a situation where I nearly lost everything I had worked hard to build for several years. But during that challenging time, I began to view things from a fresh perspective, and that's when new opportunities started to emerge. Talented experts joined my team and became the new core.
The project caught the attention and endorsement of top cybersecurity experts, who are now valuable advisers to G-71. We have started to make sales, attract customers, and draw the attention of investors. This experience has taught me that fresh growth often appears after a wildfire, and it's important to keep this in mind during difficult times.
What’s in the plans for the upcoming year, and the next 5 years?
Wow, we have so many plans! Here are my short-term vision and tactical plans for 2023:
- Close today's deals and launch new ones.
- Use the proceeds to develop our team and strengthen our sales and marketing strategies.
- Consolidate confirmed traction and update the company's valuation to start the fundraising process.
- Use the raised funds to scale up the G-71 business.
Looking at the big picture, we have tremendous development opportunities ahead of us. Our backlog of system improvements is vast, including dozens of major upgrades and new features. Additionally, we have identified whole branches of prospective integrations with complementary systems.
We plan to enhance the security of third-party systems by providing additional protection against photographing and disclosure of sensitive documents, such as cloud storage solutions, electronic document signature systems, and Insider Threat Management solutions, among others.
I can talk about these plans for hours. There's a whole carload of ideas aimed at the next couple of years.
What’s the best thing you read in the last year?
I prefer to consume specialized materials and news on a variety of topics rather than following any particular podcast or book. To efficiently stay up-to-date, I prefer to receive a digest that covers my interests, and if something catches my attention, I will dive into the details. I also use Google Alerts to track the queries I'm interested in.
Advice for other entrepreneurs who might be struggling to grow their business?
Listen, this is going to be one of the most exciting adventures of your life. It's your chance to make your dreams a reality exactly as you envision them. So if you have an idea that you can bring to life, don't let time slip away.
I keep a separate notebook where I jot down various ideas that could be the next startup project. Sometimes, when I revisit it, I worry about how not to turn it into a graveyard of unrealized and unattempted ideas.
Don't forget about your ideas. Their realization is an interesting process, and this experience can make you and the world better, if not happier.
Are you looking to hire for certain positions right now?
We are currently gearing up for a significant hiring effort across various departments, as we anticipate rapid growth in the near future. We will be bringing on board developers, engineers, and sales professionals, as well as our cybersecurity team. If you are interested in joining our team, please stay updated on our latest news and announcements by following the links below.
Where can we go to learn more?
If you have any questions or comments, drop a comment below!
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
