Elson Acquired A SaaS Startup For $1 (Now $14M In Revenue)

Matthew Elson

•

Updated: November 19th, 2023

At Starter Story, we find and catalogue business case studies from all over the internet, for you! This case study was not conducted by Starter Story, but it has been verified by our team. You can check out the full story here.

Matt Elson is the CEO of Evotix, a company that helps companies manage health, safety, and risk and engage with their employees to create safe and compliant workplaces.
The company currently has 400-500 paying customers and 50 million total employees on its platform.
The company has seen significant growth, with revenue increasing by 50% year-over-year.
Evotix has raised VC funding to support its growth and expansion plans.

How Matt Elson acquired the Evotex business for $1

Elson discovered the opportunity to buy a software company in distress for $1.
The software company was 15 years old and had 200 customers.
Evotix is now in its second decade of business and has double-digit millions in revenue.
He acquired the company for $1, navigating a lawsuit from a former customer and maintaining company culture as the team grew from 50-150+ employees.

Evotix Growth Path

At the time of its purchase, the company had 200 customers with an average revenue per user (ARPU) of $2,000.
After settling the lawsuit, Elson focused on growing the business by identifying the company’s best customers and building a traditional sales team with business development representatives (BDRs) and quota-carrying reps.
This strategy allowed the company to expand to other divisions and geographies within existing accounts, doubling the number of customers and increasing the average contract value (ACV) 12 times to $25,000.
Between 2018 and 2020, CEO Elson raised $10 million in external capital through Series A and B funding rounds.
The company closed $6 million in Series A funding, taking $3 million each in 2018 and 2019, and another $5 million in Series B funding in 2020.
The company’s annual recurring revenue (ARR) first crossed $1 million in 2014 and reached $14 million when the Series B funding was raised.

Marketing Strategies

CEO Elson’s classic direct sales and marketing team of 50 has grown the company’s revenue by 43% over the past year.
The team, consisting of marketing to drive awareness, BDRs to nurture opportunities, and sales reps to close, has helped the company pass $1.2 million in annual recurring revenue (ARR).
As the team has grown from 50 to 150 people, it has become challenging for Elson to know everyone individually.
To maintain the company culture, Elson travels to meet people and holds Town Hall meetings every two weeks.
The Town Hall meetings are 30 minutes long and cover customer success stories, birthdays, anniversaries, and High 5s to call out values.
Elson uses 15five.com to help engage his team and maintain the company’s pulse, which he believes is essential for driving business.