← Back to browse

Inform

by Michael OzalpartiLaunched 2018via Nathan Latka Podcast
See all SaaS companies using other
Growthother
Pricingsubscription
The Spark

Michael Ozalparti spent five years building Sabazo, a professional services and custom software company serving global hospitality firms with employee development tools. The business grew to "upwards of 40%" growth rate and generated just under $1M in ARR through project-based work and licensing. But Michael saw a ceiling: the services model was high-touch, low-leverage, and ultimately not scalable. He realized that the real opportunity wasn't in building one-off custom solutions—it was in productizing what his team had learned from working directly with 20 large enterprise clients across the hospitality space.

Building the First Version

Instead of abandoning Sabazo, Michael made a bold decision: use the cash flow from the agency to fund a new SaaS product called Inform. He bootstrapped the venture with $200,000 saved from Sabazo's revenues—no outside capital. The team split into two: 10 people remained on Sabazo (which would continue generating revenue and insights), while 5 people moved to Inform. The product launched in beta in 2018, positioning itself as an all-in-one LMS for hospitality teams. The key differentiator wasn't just the software—it was bundled content. Michael identified a critical gap: most LMS platforms fail because they lack engaging content. Inform would solve both problems by providing pre-built, professionally produced video and text courses alongside the platform itself.

What Worked (and What Didn't)

Michael's dual-company strategy was counterintuitive but strategic. Rather than going all-in on Inform and burning cash, he kept Sabazo alive as a cash engine and customer research lab. The 20 enterprise clients at Sabazo became the proof-of-concept for Inform's value proposition. This approach allowed him to bootstrap responsibly while gathering real-world intelligence about what hospitality teams actually needed to train employees effectively. The pricing model was straightforward: three tiers, two paid, targeting SMEs in hospitality with a freemium entry point.

Where They Are Now

As of the interview in 2018, Inform was pre-revenue—still in beta, with pricing set to launch by year-end. Michael was clear about the long-term vision: transition fully into the product space over the next five years while maintaining Sabazo client relationships through their contract terms. This wasn't about running two businesses forever; it was about using cash flow and customer knowledge from the legacy business to fund and validate the future one. Michael's philosophy: "You can never buy resourcefulness. What we've achieved in five years working with these customers face to face is a tremendous amount of experience in the space."

Why It Worked
  • By maintaining the cash-generating agency business while building the SaaS product, Michael eliminated the need for external funding and avoided the pressure to achieve unrealistic growth timelines that force premature scaling decisions.
  • Direct relationships with 20 enterprise clients in Sabazo provided validated market feedback and proof-of-concept data that informed Inform's product design, reducing the risk of building features nobody wanted.
  • The bundled content strategy addressed a concrete, observed failure mode in the LMS market rather than replicating generic competitors, creating a defensible differentiation that resonated with the target customer segment.
  • Splitting the team into two entities allowed Michael to retain institutional knowledge from five years of customer problem-solving while freeing capacity to design a scalable product without losing the revenue that funded it.
How to Replicate
  • 1.If operating a service business in your target industry, deliberately preserve and extend client contracts while allocating a small, dedicated team to build the productized version of your core service offering.
  • 2.Conduct structured interviews with your 15-25 largest service clients to identify the one critical gap or pain point that existing off-the-shelf solutions consistently fail to address, then make that gap your core product differentiator.
  • 3.Build the SaaS product's first version using only the cash generated by your existing business—set a specific bootstrap budget (e.g., $200K) and design your MVP scope to fit within it, avoiding dilution and external pressure.
  • 4.Create a tiered pricing model (freemium + two paid tiers) that targets SMEs in your industry specifically, pricing based on the value your service work demonstrated to enterprise clients, not on competitor pricing.

Similar Companies

247.ai

$25.0M/mo

247.ai, founded by PV Cannon in 2000, is an AI-powered customer service automation platform serving over 150 enterprise customers with $300M+ in ARR. The company raised only $20M from Sequoia (2003) and bootstrap, achieving 10% net profit margins while maintaining a 12-month CAC payback period and 100% net revenue retention. Despite a security breach setback around 2018, 247.ai has recovered and recently achieved 20% new revenue booking growth in their best quarter.

iCIMS

$13.3M/mo

iCIMS is a bootstrapped SaaS provider founded in 1999 that dominates the talent acquisition software market as the #2 player, serving 3,500 enterprise customers with an average monthly spend of $4,000. The company exited 2017 with $160M ARR and is targeting 25%+ annual growth while maintaining profitability, recently acquiring Text Recruit to expand into candidate messaging and recruitment advertising.

Zoom

$12.0M/mo

Zoom is a freemium SaaS video conferencing platform founded by Eric Yuan in July 2011 after he left Cisco to build a next-generation collaboration solution. The company has grown to 850,000+ paying customers across individual, SMB, and enterprise segments, generating over $12M in monthly recurring revenue with approximately 100% year-over-year growth. Rather than focusing on customer stickiness or aggressive growth targets, Zoom emphasizes customer happiness and organic word-of-mouth acquisition, which has proven highly effective in driving viral adoption.

Madwire

$10.0M/mo

Madwire is a comprehensive SaaS platform for small businesses (1-100 employees) that combines CRM, payments, invoicing, billing, e-commerce, and multi-channel marketing tools in a single platform. Founded in 2009, the company has grown to $120M ARR serving 20,000 customers with an average revenue per user of $500/month, while maintaining strong unit economics ($3,000-$4,000 CAC with 3-month payback) and recently turning profitable with a focus on reaching 15-20% EBITDA margins. The company is exploring an IPO within 12-18 months without having raised substantial capital beyond an initial $7.5M.

SwiftPage

$7.0M/mo

SwiftPage is a CRM and marketing automation platform founded in 2001 that targets small businesses. Under CEO John Oshel's leadership since 2012, the company scaled from 60,000 customers with $26.2M revenue in 2015 to 84,000 customers today with an estimated ARR of $36M+, maintaining 1.5% monthly logo churn and a 6-7 month payback period with a sub-$500 CAC.

Related Guides