Silenz

Ted Morocco had a front-row seat to software piracy during his time as co-founder of AWR Corporation, a leading high-frequency analog design company in the semiconductor space. When National Instruments acquired AWR in 2011 for $57M+ (with earn-outs), Ted stayed through the transition until 2014. But he couldn't shake the problem he'd witnessed: expensive, mission-critical software was being stolen, over-deployed, and misused across enterprises—and vendors had no visibility into it.

The spark came from a significant legal victory. Ted had been involved in a case defending AWR technology being stolen by a Chinese telecom company, and they won a "very significant summary judgment." The case became newsworthy and proved two critical things: (1) software piracy was widespread, and (2) technical and legal means existed to stop it. When Ted left National Instruments in late 2014, he and co-founder Chris Louton—another successful entrepreneur running a cash-flowing company called ITCA—decided to build a commercial solution around this insight.

Ted and Chris bootstrapped Silenz (then called Smart Flow Compliance Solutions) with capital from the AWR sale and Chris's cash-flowing business. They were "pretty fiscally conservative" in the early years, avoiding venture funding despite opportunities. "The dilution and the strings that can come with early funding can be very dilutive to founders," Ted reflected. They invested about $2-3 million personally before turning profitable in 2018.

The product was focused but powerful: telemetry software that tracked how on-premise software was actually being used, detected over-deployments, identified counterfeit or cracked licenses, and helped vendors amicably reconcile licensing gaps. Unlike SaaS, where usage is transparent, on-premise software was "still the wild west of chaos"—evaluation licenses got over-deployed, key generators cracked licenses, and vendors had no idea how many seats were actually running their software.

Ted's credibility from the successful lawsuit against the Chinese telecom company opened doors immediately. Big semiconductor and EDA companies noticed the legal victory and the proof-of-concept it represented. When Ted approached them, he could say: "We've proven piracy is rampant, and we've proven you can protect against it." This allowed him to land "marquee clients from the very start"—billion-dollar, publicly-traded companies.

These weren't small deals. The first full year (2015) generated over $1 million in ARR, an impressive feat for a bootstrapped B2B SaaS company. But early customer acquisition was grueling. Ted estimated they spent roughly $100,000 in CAC to land a $120,000 ACV account—a long payback period. The challenge: data privacy and security concerns made it hard to convince Fortune 500 companies to share sensitive licensing and usage data with a startup. As Ted noted, "It was as much work to bring on a billion dollar client as it was to bring on a 10 million dollar prospect."

What worked was extreme focus on customer success, not aggressive sales. By 2020, Silenz had only three quota-carrying sales reps (each with $1M quotas) and Ted + his co-founder doing relationship-based selling. Most of their 40-person team were engineers (33 of them), with an R&D hub in Dublin. The payoff was extraordinary: 100% gross retention, 125% net revenue retention (with 25-30% expansion), and only 2.5% annual churn—"pretty close to 100% retention," as Ted said.

Their go-to-market leaned heavily on customer referrals and relationships, not outbound sales or marketing. One customer example illustrates the stickiness: a software vendor had a generous university license policy but didn't realize the key generator was publicly available on their website. Anyone could generate a $5,000 license, so tens of thousands of university licenses were being used commercially worldwide. Silenz found it, quantified it, and helped them recover the value.

The unit economics showed why they could stay profitable and bootstrap: 50-70% YoY growth consistently, with a 50/50 sales compensation model ($150k base + $150k commission for $1M quota hit) that kept costs controlled relative to SaaS peers. New customers took about three years to fully mature, but once they did, expansion was massive.

By the time of this interview (early 2020), Silenz was on track to hit $10M ARR (up from ~$6M in 2019 and ~$4.5M in 2018), serving over 100 customers with ~1,500 seats. The company remained fully bootstrapped, self-financed, and profitable. Ted had expanded the product vision beyond anti-piracy to "usage analytics" and rebranded as Silenz to position it as the SaaS-like visibility layer for on-premise software vendors.

Ted's philosophy on scaling was clear: invest in customer success over aggressive sales expansion, lean on relationships and referrals, and hire engineering talent globally (Dublin) to build defensible technology. He and Chris had created a rare bootstrap success story—a B2B SaaS company with massive enterprise customers, extreme stickiness, and healthy unit economics, all without venture capital.