Patrick Hankinson is not a guy who wears his heart on his sleeve, but he does post his business metrics by his door.
Hankinson is a soft-spoken entrepreneurial whiz who runs Compilr, an online development environment that allows users to learn, write and test code in the cloud.
Earlier this month, Compilr moved into Volta, the new co-working space for startups in Halifax. Beside the door of the company’s new office, Hankinson has posted two rows of printouts, one labelled The Good, and the other The Ugly. They show the company’s good and bad news over the past two years.
The prominent printout in the Good category is a chart showing the company’s soaring revenues, which have increased 57 per cent this month and are on track for a 720 per cent annual increase. It’s been a long time coming.
Two years ago, the company was one of two Canadian companies selected to participate in the Seedcamp New York accelerator, and it was then selected for the international Seedcamp event in London. (It was, I believe, the first company news ever posted on Entrevestor.)
Hankinson and his team have been working away at making Compilr the place where techies will come to write code and pay for the privilege of doing so.
They did really well on the first part. One printout in The Good category states about 200,000 users (most of whom use it free) are registered at the site, including Google, Microsoft, Samsung and students from Harvard, Stanford and the Massachusetts Institute of Technology.
It’s that second part — bringing in revenue — that has dogged the Compilr team.
Until recently.
In October, the company decided the time had come to get money out of its existing customers rather than adding new ones. So it began an email campaign to its clients advertising its premium products, and it upped the subscription price from $4.95 to $10. There was an immediate jump in revenue, which shows up on the chart posted by the office door.
Then three weeks ago, Compilr decided it would no longer offer the free service to new clients (other than a 14-day trial period) to provide a better initial impression of the product instead of offering a crippled freemium product. Hence the massive jump in revenues.
So what’s the Ugly?
“We’ve been rejected by more than 35 venture capital funds,” Hankinson told the crowd at Volta’s opening bash Friday night.
The good-natured line brought in gales of laughter, but the posts by the door show the serious side of these rejections. Compilr’s three main competitors, all based in San Francisco, have been able to raise capital from VC funds. Codenvy and Koding.com raised $10 million each and Cloud9 IDE attracted $5.5 million.
But this lack of funding is becoming less of a problem because revenue is growing so quickly. The company is on track to be cash-flow positive next month, meaning it can finance operations just from the revenue coming in.
“The first few times we tried to raise capital it was purely for survival,” said Hankinson. “Now we’re at a stage where external capital would accelerate the business. But if it doesn’t happen, our revenue will allow us to grow naturally.”
Hankinson thinks the team can accelerate revenues even faster with a focus on revamping its educational platform, which teaches users coding languages. It’s also working on a computer science platform that would allow university clients to teach courses on Compilr.
It seems The Good column is outflanking The Ugly column quickly at Compilr.