Monday.com surpassed $130M ARR before the remote-work boom

This member of the $100M ARR club keeps surprising

As efforts to flatten the spread of COVID-19 pushes employees from their offices, remote work is undergoing a surge in popularity.

Well-known remote-work-friendly companies like Zoom have seen a rise in usage, while Slack has already reported that it is successfully converting new users into paying customers, which is pushing up its growth rate.

The pandemic is creating economic and social upheaval, but for a specific cohort of software companies that help distributed teams work together, it’s proven useful in business terms. But even before the outbreak of the novel coronavirus, execs from a standout project management company swung by TechCrunch HQ to chat with the Equity crew about their business and growth: Monday.com. 

What does an interview with Monday.com’s Eran Zinman (co-founder and CTO) and Roy Mann (CEO) have to do with COVID-19? Well, if remote-productivity-friendly services Slack and Zoom are seeing usage spikes amidst the changes, Monday.com is likely benefiting from similar gains. And during our chat with the company’s brass, the pair told TechCrunch that their company had crossed the $130 million annual recurring revenue (ARR) mark by mid-February. Add in a COVID-19 usage boost and perhaps Monday.com (which doesn’t have a free tier) is seeing its growth accelerate.

Previously, Monday.com announced that it had reached the $120 million ARR mark, and TechCrunch had inducted it into the $100 million ARR club earlier this year.

Revenue expansion was not our only topic. We also chatted with the pair of execs about customer acquisition costs and how to a run a SaaS business without terrifying burn. The Monday.com crew had more news up their sleeve, like when they expect the unicorn to become cash-flow positive. 

We’ve excised a larger-than-usual chunk of the interview for sharing, as there’s a lot to take in:

After the jump, we dig a bit deeper into the obvious IPO candidate

Money in the bank

When we recorded this interview, the idea of a COVID-19 lockdown in the United States or Israel, the two countries where Monday.com has offices, wasn’t top of mind, let alone reality. But today, living in a very different world, it’s interesting how the conversation has taken on new overtones.

For example, in a Q4 2019 mindset, I’d probably stress the company’s cash position — the execs noted that they have a funding round or two in the bank — as illustrative of the unicorn era in which investors were more than happy to stuff promising companies with cash, whether they needed it or not. Today, however, the cash seems more like a competitive edge than a cautionary tale of investor excess.

With the amount of cash the Monday.com team intimated that it has on hand, the firm is safe from the downturn and can perhaps act aggressively. It could pick up smaller firms that lack its cash cushion that have interesting customer sets of employee bases; and Monday.com can pursue sales and marketing spend that other firms might not be able to access.

While other firms are trying to survive, the well-capitalized and efficient are in less danger; the companies that were making less of a splash before, then, are those that may have the larger long-term impact. Because they won’t die as frequently as their peers who spent more and carried less cushion. 

The full cut below has a bunch of other stuff in it, including how the company’s culture has changed as the company has scaled. You’ll also learn about how failing at your first company doesn’t mean that you are a failure for all time. But as you listen, consider the world we live in, and how well-prepared it appears that Monday.com is for the current market pullback.

Equity on Extra Crunch is going on hold for a bit until we can get back to recording IRL. But Equity rolls on with shows now less frequently than Monday and Friday mornings. Stay cool, and we’ll chat soon.