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Stu Sjouwerman. He\\u2019s a serial entrepreneur and currently the founder and CEO of KnowBe4.com. He\\u2019s a big Shark Tank fan. He\\u2019s based in Tampa, Florida.

Famous Five:

• Favorite Book? \\u2013 Positioning
• What CEO do you follow? \\u2013 Elon Musk
• Favorite online tool? \\u2014 SurveyMonkey
• How many hours of sleep do you get?\\u20146
• If you could let your 20-year old self, know one thing, what would it be? \\u2013 \\u201cI wished that my 21 old self knew that Bill Gates was going to go into Windows server, in about 1995\\u201d

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Time Stamped Show Notes:

• 01:21 \\u2013 Nathan introduces Stu to the show
• 01:46 \\u2013 KnowBe4 is a new school IT
  • 01:51 \\u2013 KnowBe4 focuses on modern security and awareness training
• 02:08 \\u2013 KnowBe4 is a SaaS company
• 02:46 \\u2013 Average pay per user is $15/year
  • 03:01 \\u2013 The charge is annual upfront which is easier and most people prefer that
• 03:26 \\u2013 KnowBe4 focuses on organizations with 50 users and up
• 03:36 \\u2013 Average seat size varies
  • 03:52 \\u2013 Average seat size for SMBs is 200-300 and for enterprise 1500-3000 seats
• 04:21 \\u2013 Stu sold his anti-virus company in 2010
• 04:35 \\u2013 It was called Sunbelt and Stu\\u2019s 4th startup
• 04:56 \\u2013 \\u201cWe are growing like crazy\\u201d
• 05:01 \\u2013 KnowBe4 did $7M in 2015, $24M in 2016 and is targeting $50M this year
• 05:26 \\u2013 KnowBe4 does inbound marketing and they send newsletters to their list of 1.2M people
  • 05:40 \\u2013 The list was built over several years
• 05:57 \\u2013 KnowBe4 was bootstrapped for 5 years and Stu spent around a million building the company
• 06:07 \\u2013 In December 2015, they took $8M from VC
• 06:47 \\u2013 Total fund raised was $13M
• 07:11 \\u2013 It was easy for Stu to let go of 20% of the company
• 07:25 \\u2013 Stu\\u2019s told Kevin Mitnick that he would give him 50% of his company in exchange for Kevin\\u2019s 30-year experience in hacking
• 08:34 \\u2013 The cap table
• 09:10 \\u2013 Stu is confident that KnowBe4 will earn $50M this year
• 09:20 \\u2013 Churn is 15% annually
• 09:33 \\u2013 It is relatively easy to predict whether a SaaS model will be profitable
• 09:43 \\u2013 KnowBe4 serves 9500 companies
• 09:55 \\u2013 Average ARR
• 10:22 \\u2013 March revenue
• 10:58 \\u2013 Enterprise sales come in March
• 11:10 \\u2013 Team size is 290
• 11:27 \\u2013 CAC is around $2600
• 11:39 \\u2013 CAC to LTV ratio is 7
• 12:02 \\u2013 CAC payback is instant
• 12:17 \\u2013 Average selling price per year
• 12:42 \\u2013 Stu likes Vladimir Putin
• 14:03 \\u2013 Eagles programs are state-sponsored programs that are offensive cyberattacks
• 14:49 \\u2013 USA also has offensive cyber weapons, same with China and Russia
• 14:58 \\u2013 Hackers go after the weak link in IT security, which is the human
  • 15:15 \\u2013 It comes in the form of an email
• 15:33 \\u2013 KnowBe4 sends frequent phishing attacks that are similar to legitimate ones
  • 15:43 \\u2013 This will make the team aware and cause them to be on top of their toes in case they receive an attack
• 16:02 \\u2013 KnowBe4 has a phish alert button
• 16:30 \\u2013 KnowBe4 trains people with the real stuff
• 16:41 \\u2013 Stu used to play soccer and is very competitive
• 16:49 \\u2013 Stu has 2 reasons why he wants to go public:
  • 16:52 \\u2013 First, because he has never gone public before
  • 16:57 \\u2013 Second is to expand further and faster
• 17:12 \\u2013 KnowBe4\\u2019s biggest competitors are PhishMe and Wombat
• 17:26 \\u2013 Stu gets their competitors\\u2019 information from Owler
• 17:45 \\u2013 There\\u2019s a possibility of Stu acquiring one of their competitors once they go public
• 18:11 \\u2013 Stu got $10M from his previous exit and he\\u2019s NOT doing KnowBe4 for the money
• 18:57 \\u2013 The biggest problem Stu had with his previous company was social engineering
• 19:08 \\u2013 \\u201cNobody is really taking care of the human IT security\\u201d
• 20:30 \\u2013 The Famous Five

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3 Key Points:

1. There\\u2019s a big gap in human IT security and more and more people aren\\u2019t even aware they\\u2019re being hacked.
2. Going public can help a company expand further and faster, and perhaps even acquire the competition.
3. There is no such thing as retirement.

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Resources Mentioned:

• The Top Inbox \\u2013 The site Nathan uses to schedule emails to be sent later, set reminders in inbox, track opens, and follow-up with email sequences
• Klipfolio \\u2013 Track your business performance across all departments for FREE
• Hotjar \\u2013 Nathan uses Hotjar to track what you\\u2019re doing on this site. He gets a video of each user visit like where they clicked and scrolled to make the site a better experience
• Acuity Scheduling \\u2013 Nathan uses Acuity to schedule his podcast interviews and appointments
• Host Gator\\u2013 The site Nathan uses to buy his domain names and hosting for the cheapest price possible
• Audible\\u2013 Nathan uses Audible when he\\u2019s driving from Austin to San Antonio (1.5-hour drive) to listen to audio books

Show Notes provided by Mallard Creatives