Marc Andreesen famously proclaimed that “software is eating the world” in 2011. Since then there has been a meteoric increase in company spend on SaaS applications. The average employee uses 8 SaaS applications and the average company spend jumped 78% from 2017 to 2018 to $343K per company. Cledara is the centralized platform that empowers companies to buy, manage, and cancel SaaS subscriptions. The platform, founded in 2018, provides budgeting tools – like a virtual card with spending limits – to help helps COOs and CFOs know where and how the company’s money is being spent.
London TechWatch spoke to Cristina Vila about creating the budgeting tool for the subscription economy.
Who were your investors and how much did you raise?
Cledara has closed its pre-seed round led by Anthemis and joined by 2018 UKBAA Angel Investor of the Year, Chris Adelsbach. The round takes the total raised by the company to $930K. This funding round makes Cledara the first participant of the current Techstars London cohort to have raised and was the first-ever investment made by the Anthemis and BBVA Partnership.
Tell us about the product or service Cledara offers.
Cledara is for businesses to manage purchases, especially subscriptions, and provide the infrastructure for teams to collaborate with those working remotely and in different offices or countries. By tracking the ‘who’ and the ‘why’ behind each purchase, Cledara provides organisations with instant insight into their spend and the power to manage spend before it happens.
Every year, companies waste more than $20B on duplicate, unused, or forgotten SaaS. There are dozens of companies that help sellers of subscription software optimise its sale, but until Cledara there were no solutions for the buyers of software to manage its purchase.
What inspired you to start Cledara?
There are dozens of companies that help sellers of subscription software optimise their sales, but there is basically no platform to help companies buy and manage software subscriptions in a scalable way. We believe that unless companies have a way to manage cloud software at scale, it will be very difficult for SaaS to reach the mass market.
How is Cledara different?
We are different because we are fully focused on helping tech companies with the purchase and ongoing management of their subscriptions. Everything is becoming a subscription, and the method of managing one-off payments is very different than managing recurring payments. Additionally, we are building a collaborative platform, hence breaking the traditional finance silo where all the data is gathered but not shared. We want to provide that data to the business because they are the ones that can take action based on the analytics and insights.
What market you are targeting and how big is it?
$80B is spent on SaaS every year, and it’s growing at 20% each and every year so it’s a massive and fast-growing market. We want to help companies be successful users of SaaS, but each year 20-30% of what is spent on SaaS goes on unused, duplicated, or forgotten SaaS – so something is clearly not working. Every software company’s inactive user is money being wasted.
Who do you consider to be your primary competitors?
Google Sheets! Before I started Cledara, I had the problem of SaaS running out of control in my previous company. The best I could come up with was a Google Sheet – and turns out that every other startup I spoke to was trying to manage it that way too. There had to be a better way and that’s why I started Cledara.
What’s your business model?
We charge a monthly subscription fee, plus earn a small amount of interchange from merchants where our Cledara Mastercards are used.
What was the funding process like?
Anthemis was fantastic. They were super supportive the whole way and I can’t speak highly enough about Farhan who led the investment for them. This was our first round with a venture fund and he helped us through every step of the way.
What are the biggest challenges that you faced while raising capital?
Multi-tasking. Due diligence, reviewing documents and speaking to lawyers takes time. We’re a small team and everything that isn’t building product and speaking to customers and prospects feels like it slows us down. We’re happy the round is done so we can refocus.
What factors about your business led your investors to write the check?
Farhan wrote a great blog post about this. It’s totally worth reading and captures the opportunity perfectly.
What are the milestones you plan to achieve in the next six months?
The next 6 months are all about product and hiring. We’re looking to add a Tech Lead to join our 4 person engineering team and a Product Lead as soon as possible. On the product side, we have a bunch of exciting things coming out driven by our customers. Watch this space!
What advice can you offer companies in London that do not have a fresh injection of capital in the bank?
Keep going. The way to success is always found with your customers. Talk to them, listen and keep iterating.
Keep going. The way to success is always found with your customers. Talk to them, listen and keep iterating.
Where do you see the company going now over the near term?
We’re focused on making it 10x easier for customers of SaaS to purchase and manage their stack.
What is your favorite restaurant in London?
The Yellow House in Surrey Quays is a favourite after a long week. Jaime and Robert have a passion for making high-quality pub food.
