He didn't raise VC for the first 7 years— then grew to $1B in ARR. | Dax Dasilva, Founder of Lightspeed

Dax built Lightspeed into a $1B ARR public company—even though he bootstrapped for the first 7 years. In this episode, he reveals exactly how he used a 4x pricing shift to create a global reseller machine that grew him to $10M ARR. He also breaks down why obsessing over design and deep customer empathy built the foundation for success.—and how stepping away from his comfort zone as an introverted developer was the key to scale. If you’re an early-stage founder trying to nail pricing, distribution, and long-term strategic decisions, this story is your playbook.

Why You Should Listen

• Learn how to price your product to build a distribution machine.
• Why early profitability can make your startup unstoppable.
• How bootstrapping forces clarity—and can unlock massive scale.
• Why the hardest move for founders is often letting go of what they’re best at.
• Why giving away titles and equity too soon is a trap.

Keywords

product market fit, pricing strategy, bootstrapping, reseller partnerships, early-stage startups, go-to-market strategy, startup scaling, founder lessons, Lightspeed POS, profitability

00:00:00 Intro

00:07:56 Landing the First Customers Without a Product

00:11:28 The Pricing Strategy that Changed Everything

00:19:20 Growth Through Partnerships

00:26:18 Why a Business Plan Can Actually Help

00:34:33 Profitable from Day One

00:42:15 From On-Premise to the Cloud

00:46:59 Finding Product-Market Fit

00:49:15 The Truth About Early Employees and Equity

00:53:18 Reinventing Your Role as Founder Every Year

Chapters

• 0:00 Intro
• 7:56 Landing the First Customers Without a Product
• 11:28 The Pricing Strategy that Changed Everything
• 19:21 Growth Through Partnerships
• 26:18 Why a Business Plan Can Actually Help
• 34:34 Profitable from Day One
• 42:15 From On-Premise to the Cloud
• 46:59 Finding Product-Market Fit
• 49:15 The Truth About Early Employees and Equity
• 53:18 Reinventing Your Role as Founder Every Year

Transcript

Dax Dasilva (00:00:00):
We're profitable for seven years until we took venture capital. I had to throw out my job description every year and actually take up a new job description that was usually pushing me out of my comfort zone, out of things I liked doing, like development and design, and into something that I was completely uncomfortable or even bad at doing. The lesson is, if you're building a product. Who are the adjacent people in the ecosystem that could be selling what you're doing alongside with what they're doing? An interesting part of that early story is. You know, I had no money. I mean, I was on unemployment for two years. All I wanted out of this whole thing was to win an Apple Design Award from Steve Jobs. Literally my role.

Pablo Strugo (00:00:43):
Did you get that?

Dax Dasilva (00:00:44):
No.

Pablo Strugo (00:00:45):
You got the other part, right?

Previous Guests (00:00:47):
That's product market fit. Product market fit. Product market fit. I called it the product market fit question. Product market fit. Product market fit. Product market fit. Product market fit. I mean, the name of the show is Product Market Fit.

Pablo Strugo (00:00:59):
Do you think the Product Market Fit show has product market fit? Because if you do, then there's something you just have to do. You have to take out your phone. You have to leave the show five stars. It lets us reach more founders, and it lets us get better guests. Thank you. Dax, welcome to the show, man.

Dax Dasilva (00:01:14):
Thanks.

Pablo Strugo (00:01:14):
I'm excited to be here.

Dax Dasilva (00:01:15):
It's great to have you here. And I was looking, so you started in 2005, which means you must have your 20-year anniversary coming up when?

Dax Dasilva (00:01:24):
We just celebrated in, March 18th was the date of incorporation, and the company threw me a surprise party. I thought it was booked for meetings up until 7 p.m., and it was just a big cocktail party and a cake.

Pablo Strugo (00:01:37):
That's awesome.

Dax Dasilva (00:01:38):
And a varsity jacket with 20.

Pablo Strugo (00:01:42):
I saw that, yes. Actually, it was a nice jacket. It was a nice jacket. And then you came on the show to talk about it all. That's perfect. Perfect cap to the 20-year anniversary. Cool, man. Well, look, I mean, you're one of the most iconic companies to come out of, you know, I can't even call you a tech startup, but, you know, kind of one of the. Most iconic tech startups, I would say, coming out of Canada, you did, if I got it right, about a billion dollars in trailing 12-month revenue, which is just insane. But you're also, I think, an example of, you know, it takes a long time. Like these, you know, zero to $100 million there are in a year or two years or whatever is happening these days. is not the norm. I think the norm is a lot more like your story starting in 2005. And, you know, you're hitting those numbers now in 2025, right? 20 years later. So we'll walk through all that. I mean, mainly the first part of the journey. Because , a, you know, biased me thinks it's the most interesting part. And second, because that's what the show is about. But maybe let's start there. Like, take us back to 2005. Like, what was, who were you at that time? What was going on in the world? Just kind of set the context for us.

Dax Dasilva (00:02:45):
Yeah, 2005, two years before the iPhone comes out. So I guess we were on flip phones. Yeah, I had moved to Montreal.

Pablo Strugo (00:02:51):
I mean, I'm a native of Vancouver. I had moved to Montreal like maybe four years before that. I was 28. I mean, I'd been building software on the Mac since I was 13. I worked for a startup. So my very first job was interning for, like, a Mac software development company for a couple of years. And so I actually got the startup bug before I even knew what a startup was. I was just working for this company that was my dad's boss's son's new company.

Pablo Strugo (00:03:17):
And they were building what? Like some software for Macs?

Dax Dasilva (00:03:20):
Yeah, they were building some early networking tools on the Mac. And then all through my teens and 20s, I was building Mac software. And a lot of it ended up being for the Mac dealership community because I was working in Mac stores. I was kind of like a Mac fanatic as a teen. This is like, these are, these are the tough years for Apple, right? Like, the years before Steve came back, when it was basically almost going to be bankrupted. And, so it was just like a diehard. Now they don't need my prayers today, but they did back then. So that was me. That was my, my whole personality was that. I was doing tech support for these dealerships but also building software for them. So I kind of got a lot of user empathy. They would send me to the worst customers, those customers that needed to be taught how to do their email over and over and over again. But I really got empathy for the user by doing that. And it helped me build better and better software. Because, end of the day, I was never really an engineer. And that's why I dropped out of computer science after year one. I was really more of a UI designer. And then for the software I was building, it was a lot. It was all business software, right. And in the case of the Mac dealerships, it was different parts of the retail operations. So I built a service department module, built a tool to calculate sales commissions, just lots of different pieces. And then my last job before I built Lightspeed was, and started Lightspeed was, a system that ran four stores. So it was almost, you know, kind of what, what Lightspeed does, but not quite. So yeah, that was sort of the lead-up to it. That business went out of business because of internal issues between the founders. And that sort of left me without a job, but I. There was a lot of folks that had seen the things that I was building and said. Can you build me something? Can you build me something custom? Can you build me something custom? And I was like, Apple was just really taking off at that point in 2005, right? It was just Steve was back. iMac was out. iPod was out. It was a couple of years before the iPhone and the iPad. And everybody wanted to run their business on the Mac if they could. Especially the retail stores in Soho and New York, right? And so instead of building custom systems over and over again, I was like, there's a platform here, right?

Pablo Strugo (00:05:40):
This was already out of Mac dealerships. So other people were seeing the software you're building for these dealerships, and they're asking you to build custom software for them.

Dax Dasilva (00:05:47):
A lot of Mac dealerships around the world gained a reputation. Of being able to build stuff for them, and they all wanted the system. And so they ended up being, after I built Lightspeed, they ended up being our first. First customers, and then really the first two or three hundred customers, were international Mac dealers. So I'd go to their organization, their kind of conferences, and so we just sold to them. And they were not small businesses. Some of them were multi-location. You know, all of them have the complexity that a typical Lightspeed retail customer has, like tens or hundreds of thousands of SKUs. Inventory with serial numbers being shipped to different locations where the customer needed it, floor sales, corporate sales, repair shop, parts, you know, a lot to complicated, complicated purchasing and multiple currencies because they would get supply from all over the world. So it was really, a really great place to start. They were the reason why we did, take funding for the first seven years. You know, these initial customers, the dealerships, basically, instead of each of them building their own FileMaker or Microsoft Access database, which is what they were all doing individually, these businesses are spending tons of time building out systems. They're like, okay. Let's all buy licenses from this guy. And like, let's give him all of our input. And then, you know, we can all benefit from it. And so that was, I think, a big part of the story. And then when they were good at, when they were really good at the software after one or two years, they became our international distribution network. They became our resellers. And they started to. They started to sell Lightspeed in their neighborhoods. And that's when the companies like super took off.

Pablo Strugo (00:07:38):
So let's walk through those first phases. Like first, you're out of a job. And what is your next move? Like you just start kind of getting, you know, billing for kind of custom software development? Or do you kind of say, no, no, this needs to be product company. You open up Lightspeed right away, incorporate and start building out a product. Like, how do you think about those first initial steps?

Dax Dasilva (00:07:56):
Yeah, so there was one customer, great, small Apple dealership, but very kind of forward-looking, Mike Patad at Evolution Concepts, actually here in Montreal. And he said, Build me something, please. You know, like, I really, really want something that's going to be. Because he had big expansion plans, and he wanted something great. And so I said, you know what? I'll do that for you, but I'm not going to do a custom system. I'm going to build you something that's going to be a product on its own. And let's get some other customers. You'll be a customer, but let's you and me get some other customers. And eventually this is something that you can sell as a product. And so we had his store, which was a Mac dealership. I was very familiar with, kind of, what their needs were. But we also had a spa that had a lot of product, and so on, and services. And that was like some friends that were opening a spa in Vancouver. And then we had a furniture store that was opening up in Montreal that was one of his customers. And they had a ton of inventory. So a lot of the same workflows, they had repair. And they also had an interior design component. So that's not really in the wheelhouse of Lightspeed today. But we built a whole jobs and timesheets piece to the product. And so we tried to accommodate these three kinds of profiles, plus all the Mac dealerships that were joining the platform. So we had these three initial reference customers. And, you know. I was the core developer. I was, for the first two years, coding till four in the morning every day. Pretty social person, but you didn't see me anywhere for two, four years. No co-founders. There was a couple of initial people that I hired on. I hired a lot of friends that had just graduated or that were interested. And I had one other developer that joined me, Francois. So he's like the other 20-year employee. He just actually just retired a year or two ago. But yeah. I was mainly the primary developer for that period. And so what I would, you know, this was pre-cloud, right? On-premise software. So I would be coding and then going to the stores, watching them use it, watching the staff operate it. And that's how Lightspeed. The original version of Lightspeed became this ultra-crafted product that people just, when we discontinued it. People did not want to get off of it. It's just like there's things that that original product does. I wish the current, you know, like, obviously now it's cloud, it's web browser-based. It's like, but you know, there's something about beautifully crafted Mac software that it's hard to compete with, right? And I'll be totally 100% honest with you. People laugh when I tell them this, but my only goal is. Was not to build a company with a public company that's at a billion dollars. I have no finance background. I had not even a clue what that even meant. All I wanted out of this whole thing was to win an Apple Design Award from Steve Jobs. Literally my goal.

Pablo Strugo (00:11:02):
Did you get that?

Dax Dasilva (00:11:03):
No.

Pablo Strugo (00:11:05):
You got the other part, right?

Dax Dasilva (00:11:06):
Well, then he passed away, right? So they were like, hey, this is never happening. That was, like, that was the entire goal, right? So. But the reality was the UI for that product was incredible. We just didn't use Apple's official tools that they were really promoting with the Design Awards. So we got a little bit shafted there.

Pablo Strugo (00:11:28):
But you were obsessed with product and design then. Walk me through. I've got kind of maybe a multi-part question, but like one is just to understand for me, like what are the main use cases that you are solving for these three very different customers so that it's still a product and not custom? And then related to that is kind of this thinking around, you know, product is a funny thing. Like everybody wants to build a great product, but then there's all this stuff around MVP, around don't take it too far. You know, you probably took it very far if that was your main goal. You know, just any thoughts you have around that or what you ended up doing that, obviously, you know, in your case, worked.

Dax Dasilva (00:12:02):
We're really trying to make the set the complex of managing inventory and managing all the aspects of a retail business. We're trying to make that simple, right? So the reason why people wanted to use iMac in their store. Yes, it was more beautiful than some black plastic PC, but what it meant for them was, like, okay. I'm used to being able to understand what I'm seeing on an iMac, right? So the original version of Lightspeed was almost set up like iTunes, now called Apple Music. Now makes no sense anymore. But back in the day, iTunes had playlists on the side and content on the other side. And we built the original interface was, you could see your business like you were looking at playlists. Different aspects of the business. And so when people saw the interface, they're like, okay, I already understand what this means. I understand that I can see my business this way. So it almost sold itself, right? People are like, I get it, right? I get it. And purchasing and receiving inventory and all the supplier invoices and all that's super complex. All of it's super complex. So the workflows, and that's why I have to watch people do it. I have to watch people receive stock. I have to watch people place purchase orders. I have to watch people do the invoicing or invoice part now, part later with stuff that had come in or hadn't come in. And later, when we added e-commerce, how they're doing that workflow, how they're doing transfers from stores. So all that, which is complex, they felt like, I can figure this out. It looks like iTunes.

Pablo Strugo (00:13:33):
Give me the before and after of that. You remember going in there and seeing some workflow. Here's how they're doing it now. And then now with Lightspeed, here's how they get to do it. And it's so much easier, so much simpler.

Dax Dasilva (00:13:43):
Well, I mean, for the spa, what was nice is Evolution Console, the Mac dealer. They really told me their needs. I mean, like every Mac dealer, they had some FileMaker thing that was hobbled together. So I wasn't. I understood the concept of that because I dealt with it at other Mac dealerships. So I knew what they needed. Now, the spa and the furniture store, I spent more time there because I'd never seen what they need specifically or what their day-to-day life is. But what I learned is people are going to manage inventory and they're going to sell things in roughly the same way. And actually, Lightspeed wasn't started as a point of sale system. It was started as a quoting and invoicing system because that's really what Evolution Concept wanted. We started there, and it evolved over time into being adding the front counter point of sale and all the other pieces. And concurrent with all of this, which is an interesting part of that early story, is, you know, I had no money. I mean, I was on unemployment for two years.

Pablo Strugo (00:14:45):
No way. 

Dax Dasilva (00:14:46):
Yeah, and like when you start a business in Quebec. And you just got laid off. They'll extend your unemployment, you know, for up to two years. But you have to show that there is a real business. You have to have customers you have to like. But you know, you're for a guy that was like, You're just fueled on Tim Hortons French vanilla coffees, and according to four in the morning, I didn't have a lot of expenses, you know.

Pablo Strugo (00:15:09):
Dude, I remember, by the way, just on a tangent, like it's so funny. I feel like in those early days, first of all, obviously you're younger, but also, I don't know, you just kind of align yourself with the realities of your business. And, you know, for us, I remember Lee and I, when we started GymTrack, like, you know, it was like this place called DiRienzo sold Italian subs, and we found out there were $5 cash, no tax. We were like, dude, we're eating here every day. You know what I mean? It wasn't painful either. It was just amazing to get such a great deal because you're just mining every dollar like that. It's just such a different lifestyle.

Dax Dasilva (00:15:41):
No, 100%. You find something. It works. You're eating it every day. Maybe multiple meals. So, like, in this time, you can just imagine, like, I didn't even think about money. I was having so much fun building the software, and, like, the energy level was so high. And obviously, there's money coming in. Like, there was already customers, right?

Pablo Strugo (00:15:59):
They're paying, right? All these customers, these three are paying.

Dax Dasilva (00:16:01):
They are all paying.

Pablo Strugo (00:16:01):
Okay.

Dax Dasilva (00:16:02):
Never gave any free, never any beta. Like. That was like another thing, but I'm getting to the. There's an interesting pricing lesson here in a second. Yeah. So you're on these grants. So there's not, so you're, you're, sorry, you're on this like subsistence kind of thing for you. Like it'll pay, kind of your basic expenses without living any fancy life. But like for the business itself, there was grants, right? So we applied for a grant for $6,000 and a grant for $8,000. They were like small business grants that you get here in the city of Montreal. And to do that. They required you to write a business plan. And I was like, Oh, you know, I'm a bit of a designer. I'm a bit of a, you know, just this is not my background. This is like. Sounds like BS. I'm never going to. I'm going to be made to do this. I'm never going to look at this thing again, but I got to do it. Right. So, wrote this business plan with their template. So it was like an eight-pager, 8 to 10-pager. Where I had to actually. So there's two parts. So it was the essay, and there was, like, the spreadsheet, the essay. What that made me do. Refine what we're actually going to do and build because there's so many ideas and so much potential. And there's obviously, with our early customers, and I already had them at this point, and I had an idea what we were doing, but there's so many directions you can take your company. But what writing that essay made me do was really, really create focus, right? To really define what we were doing and what we weren't doing. Because what didn't go into the document became not a part of the plan. What the spreadsheet made me do is it made me think about, okay, what is this going to look like over three years? Because I need salespeople. I need support people. I need admin. I need to think about marketing. And what kind of revenue am I going for? Now, I had some early indication of what people were willing to do. What it was worth to them. You know, that's, the other important thing of product market fit is like, what is this worth to people? And that leads me to probably the most important part of this whole exercise was pricing. In those early days of Lightspeed, there was a couple of companies I really admired. Like there was not a lot of business software on the Mac, right? Like we were really creating a new category. There's an amazing CRM package that was for, like, more like an entrepreneur that was, like, on the road, and they were keeping their contacts and building their business. And we were different, right? Like that was a multi-user system, and so were we, but we were kind of like multi-user and running the whole operation. So, you know, they were charging $140. Okay, let's try to charge $170, you know, per user. And I showed this to my dad's business partner, one of my dad's colleagues that was interested in becoming a reseller of ours. And he was like, x4. And I was like, x4. I'm like, where did you get that from? And he's like, first of all, if you try to buy a PC black plastic system out there, people are paying a ton of money. You're running the whole business. Don't look at what your competitor or what you think is somebody in your category is charging. You've got a x4. And he was thinking maybe it's a bit selfish for him because he was going to get. 

Pablo Strugo (00:19:15):
He's got to get margin. Yeah, yeah. Which is the lesson in itself because if you don't have that, then you don't have resellers, which is a whole other.

Dax Dasilva (00:19:20):
And that's like the second part of the story. That, x4. When I flowed that through a three-year spreadsheet, and it showed. The ability for the company to actually fund more developers, more salespeople, we would not be here today if we didn't times four. There's just no way. That allowed us to build the software that ended up being adopted by all of those users on a large level. And if we had kept the software cheap and had the same number, of nothing would have added up. We would not have been able to expand and scale the company. So that was a huge, huge important lesson. But of course, you've got to have that product market fit where people need the solution. They can't run their business. They have to have it. And then that's where you have. The ability to do times four, because they're thinking, okay, I'm going to pay this, but I know a lot of other people are paying this too. I'm thinking of, like, as one of the Mac dealers at the time, they were taking a bet on my one-year-old company. They're like, okay, if everybody's paying five grand for this, and we're also paying an annual maintenance fee. Then this person has real money to build something real for my needs. And so it also gives them comfort that, okay, if I'm paying the guy only $170 or a few hundred bucks per user, there's a bit more risk for me. This guy's not gonna be able to pull it off, or he's not gonna be able to do, build out a team. So it taught me a lot about the value, right? The value that you deliver with your software. And then ultimately, when they became, you know, after seven years of bootstrapping, because that was our journey. A seven year of bootstrapping, we got to $10 million of annual revenue, which was all software. All of that was driven by 400 resellers around the world, making 25% on times four pricing. And so that's how the whole business model was transformed by writing that BS business plan I didn't think was valuable. And then the discussion about pricing that changed everything.

Pablo Strugo (00:21:14):
I mean, there's a lot to pull on there, but just on the pricing piece, it's, you know, when you describe it that way, you kind of realize just how much can flow from pricing because you would think if your goal is I want every single retailer to use this product, right? You would say, well, the cheaper, the better because it just opens more doors. But the challenge is, the way you're describing it, at least, is like the pricing determines the go-to-market as well, right? And so if you're going to charge, you know, 2,000 ACVs versus 10,000 ACVs, A, the partnerships get a lot harder because there's not enough meat for the partners, so you can't do that. The sales piece is more challenging because, you know, you've got to put sales reps on it. They're closing to. So all of a sudden, you kind of, on the one hand, you're cheaper. You would assume basic economics means you can get more demand. The problem is you can't go get that demand because you don't have enough kind of juice there to go get it.

Dax Dasilva (00:22:10):
A hundred percent. Right. Like we had inside salespeople. We had partners and the resellers on a $5,000 sale. And that would have been, let's say, five users or maybe, maybe a bit more there. They're making 25 percent, after off the $5000. But they're also selling, you know, at the time is all on premise. They're selling servers. They're selling computers. They're selling networking. They're selling training. You know, we're selling $5,000 of software, but they're selling a $25,000 installation. So if you think about all the Mac dealers at the time, this is around the timeframe where Apple's opening its own stores, and they're competing with their own dealers, right? So a lot of these dealers went all in on Lightspeed. Their go-to-market was funded by the fact that they could get real margin on the software and then really good margin on all of the pieces that went connected to it. So you built a really powerful network, and we did two certification camps every year so that for people to get more advanced badges and certifications with us. About three or four hundred people would come to one in Montreal and one in the US. And that also was a part of that early seven years of bootstrapping where we did that in year one. We did that in. We started in 2005. We did our first camp in 2006.

Pablo Strugo (00:23:22):
Oh, wow.

Dax Dasilva (00:23:24):
40 people come from, like, places like Saudi Arabia, and Ireland, and Australia. Yeah. And they wanted to be the first people trained up on how to sell this. And then it just built like that from there. We didn't really have a real inside sales force. There was enough in it for these people, enough margin. They could leverage their own existing expertise. The lesson is, if you're building a product, who are the adjacent people in the ecosystem that could be selling what you're doing alongside with what they're doing? These guys were used to selling software, but they were really good at selling hardware. They're good at installing it, good at training on it. And if they could become the expert on this in their area. They could build a real business around it.

Pablo Strugo (00:24:07):
Well, you got, I mean, obviously you got partnerships like very right. But most, I think most founders, like, it's always alluring, right? Because you're like, oh, if I could just find somebody else to sell my thing, then, you know, just take off. Like they've got all these reps. And I see it fail more than succeed. I guess one question for you is, like, when you think about each of these independent, and many times the failure point. I should say is little company partners, with massive company expect, you know, a thousand salespeople are going to sell a product. Nobody you know, nothing happens. How important were you for each, like, from one reseller's perspective? How much business were they really doing? Was this five percent, ten percent, twenty percent of their business that they were able to get? Do you know what I mean? Like, I don't know if you have those. An idea of that, but how important were you for them?

Dax Dasilva (00:24:49):
So a lot of them had the perspective. I'm not sure. I think it varies, but a lot of them set up a whole department to do this.

Pablo Strugo (00:24:54):
Wow.

Dax Dasilva (00:24:55):
Yeah. Like, remember that, like I said, Apple was starting to open its own stores. There was across the street from these folks. They had to come up with other ways. That were going to be differentiated from the Apple store experience. Like one way they could, they could differentiate. So think about your products is, like, okay, how can it be, how can it be a differentiator for somebody that's selling into whatever industry that you're a secret sauce that, allows them to do something that nobody else can do, that they can get a certification that nobody else has, and it gives them an edge in their, in their sales toolkit. Right. So that's what Lightspeed gave these folks. Now, things got more complicated later. Like when we moved into the cloud and there was less hardware and there was less installation. In the case of retail, almost no installation, the partner model had to change. But for seven years, we didn't take investment because of how powerful the economics of that relationship were for those resellers and for us.

Pablo Strugo (00:25:54):
And so to be clear, like for the reseller, it was kind of like, hey, you could go across the street, buy Apple stuff there. But if you come here, then I can sell you Lightspeed. I can install it for you, and you can run your business on it versus just have, like, you know, an iMac or whatever they're going to sell you.

Dax Dasilva (00:26:06):
Yeah, like we can sell you the iMac, but we can sell you the entire thing, a huge solution. And it's not just. You're getting a box. You're getting an implementation. And an expert, somebody that's in your corner.

Pablo Strugo (00:26:18):
The other thing I want to touch on is the business plan piece that you mentioned. Business plans are really, they're not cool. They're not cool at all. I mean, they're kind of getting a little cooler now because people got this notion thing. And they started to do memos, which started to come close to a business plan. I wonder, I'm sure you meet a lot of founders. Many people have probably pitched their starts to you or asked for advice. Like when or why does a business plan sometimes make sense? Because most of the time, I think people are just doing these 10 slides, and that's it.

Dax Dasilva (00:26:44):
That is not a business plan. It is not a business plan. A 10-slide deck. Show me a business plan. Show me how this looks over. What are your projections in three years? What are you committing to? The other thing I didn't mention about the business plan. We missed the year one number. The year two number, we hit on the head. And the year three number, we exceeded. And I was like, I never. But we actually put thought into what the numbers meant.

Pablo Strugo (00:27:08):
What were those numbers? Do you remember?

Dax Dasilva (00:27:10):
I think the first year was like $80K/$90K. The second year was $400K, which we actually hit. And the third year was maybe $900K, and we exceeded, right? So they ended up meaning something. And so the problem with a 10-page deck is you could go in and change your whole strategy by changing two slides. That's not focusing. And I feel like that's so easy to just throw, a couple of ideas and not have to really go through the clarifying experience of writing that essay. And having tables for, in the essay, were tables for the pricing, tables for who are our distribution partners, what is the stuff, all of it was in there. I'm happy to share it with anybody who wants it.

Pablo Strugo (00:27:55):
Yeah, that'd be cool, actually.

Dax Dasilva (00:27:56):
I'll send it out. But to this day, I can derive Lightspeed's mission statement from that business plan.

Pablo Strugo (00:28:04):
Maybe, let me try this with you. See what you think. Like, is there maybe a right time to write a business plan? What I mean by that is, if I have an idea today and I kind of say, you know, I'm going to write 20 pages on it, the downside is I'm going to also convince myself that, oh man, this is really great because it's easy to make a great idea sound good on paper. When you've got enough reality behind it, like you did, you actually understood your customers and all these things. Is that the right time?

Dax Dasilva (00:28:27):
I think so. I think so. So yeah, you're right. We had a couple of customers. It was early in the journey, but we had enough to know. What do people value about the software? We had early product market fit. And so maybe that's the answer. Once you have established. That you have with your MVP or your early beta, you have early indications that people are going to pay for this and will convert off of a trial. and what they're willing to pay, then you have, I think, the basis for building a plan around it. Otherwise, it is theoretical, right? Because you're building numbers based on, okay, well, have I proven that people are going to pay for it?

Pablo Strugo (00:29:10):
So maybe let's go deeper now. So that's all super helpful. Let's go deeper. We have the high-level numbers, right? Like whatever, $100K, $400K, a million, let's call it, you know, round numbers. How long do you build with? You have those three first customers, right? Like, how long do you just build? With those three customers, before you go adding more, how do you think about getting the product to a certain stage before really pushing it? Like, how do you, how do you kind of bridge that gap? I'm really worried because, listen, like, you've been listening for, like, what, 10, 20, 30 minutes now. Clearly you like it. And the thing is, the next episode is way better, and you're going to miss it. You're going to miss it because you're not following the show. So take your phone out and hit that follow button.

Dax Dasilva (00:29:48):
There was certainly Mac dealers that wanted it like, right away, but they were the ones that maybe had less scale. Towards the end of year one. Where we had a lot more in the 1.0 beta, and we were starting to get to 1.1 and so on, where it had more of the advanced features, we were able to onboard. Some people prepaid. Some people prepaid, and they were like, hey, I want to guarantee that you're going to be building stuff that we're going to need, but we're not installing it now. You know, like installing it across our three stores in Chicago. That was like an early customer that bet on us. They bought it, but they didn't install it until they felt like the beta was ready. And what they were hearing in the community. That it was ready. Right. So yeah, I think that we did bring on customers as much as we could from that dealership community because there was a couple of meetings per year that they had that we were pitching, and we were showing them the progress. And as we're adding service repair modules and different pieces, people would jump on. And there were things that people were waiting for.

Pablo Strugo (00:30:50):
How do you split your time between that sales and marketing piece and the product design piece in those early years?

Dax Dasilva (00:30:56):
It's an interesting evolution in those early years, right? Because I was a developer. And of course, I had a little bit of social interaction with the people that I did tech support with and so on. But I was an introvert. And for the first two years. Where I was coding, I rented the second floor of the apartment where I was on the third floor. It's like these walk-ups in Montreal. I'd just take the back stairs down. So I'd be coding until four. Then walk the back stairs, and I would join the team at 11. And they were like, There were salespeople. There were support people. There was admin people. We grew really, really quickly. We moved offices every year. At some point, I had to give them leadership. They were like, why are we doing this? What's the vision? So I had to kind of step up and sort of become a leader for them. And as an introvert, that was a big step. And then from there, I started to be able to be more comfortable about being the spokes. So I would do these town halls and great presentations. That's one thing I knew how to do, is design something beautiful. Get people inspired. And that's what Lightspeed was sold on was like great design and great UI. So I would do those town halls, and then I got more comfortable with standing in front of these dealership organizations and pitching it and traveling and speaking in public. But founders should know none of that stuff necessarily comes naturally to everybody, right? And it's something you do with practice. You could actually be good at speaking in one format, like radio or TV, and not be good at doing a speech in front of 500 live people. And so those are all things that, that, that I had to kind of, I had to throw out my business, my, I had to throw up my job description every year, and, and actually take up a new job description that was. Usually pushing me out of my comfort zone, out of things I liked doing, like development and design, and into something that I was completely uncomfortable or even bad at doing. And I've had to do that every year of Lightspeed. I have no finance background. I had to take a company public. I had to get really immersed in it and leave the things that I loved. I had to bring on other people that were good designers and developers in the early days. But that was where I got my confidence. Was building and shipping and seeing the reaction of people and iterating. And that's what felt like a real job to me. So when I hit the transition to the leader and then by 2010 was completely out of development, I was like, I don't feel very useful. This is not a real job. Managing people, that's not a real job to me. It's not as satisfying as compiling something and giving it to somebody and seeing it come to life. But I saw in those early days a lot of other companies. That the founder was still coding after a very long period of time, and they didn't scale. The founder was still debugging things in the middle of the night instead of going out to meet the dealers or the resellers or whoever it was, or going to a conference, or going to sell. A big client. So that evolution was super important. And I think it's like. And it's dangerous when you just stay. It's easy to say, okay, this is what I'm good at. We're going to hire, you know, like, yes, you have to hire people that complete the picture, right? Like, you got to hire the head of sales. You got to hire, but you've also got to understand what does the business need from you as the leader. Every year and you got to be honest with yourself that that might not always overlap with what you think you're good at or what you're or what you enjoy.

Pablo Strugo (00:34:33):
And going back to those first three years to zooming in on it, like, I mean, if you're not taking in any outside money, then am I right to assume you are profitable? And if so, your employee count must have been like you had $100K in the first year. You had what, two employees, three people? Like, is that about right?

Dax Dasilva (00:34:51):
Like right off the bat, we had 4. Yeah, we got to 15, 20 people pretty quickly. I mean, by the time we were at 70, by the time we were done bootstrapping and got our Series A from Accel, I would say we're at about 45, 50 people. Early days, I think we got to 15 to 20 people really quickly. But remember, we had real revenue, right? And we were profitable. We were profitable. We were profitable for seven years until we took venture capital.

Pablo Strugo (00:35:17):
What are your thoughts on that?

Dax Dasilva (00:35:19):
And then we've only been profitable now for the last four quarters on an adjusted EBITDA basis, but free cash flow, we're still getting back there. And that's why this period where I'm back at the company and we're in a profitable growth phase feels like the bootstrapping days because we're balancing profit and growth. And yeah, it's a very honest way to run a business, right? You're not trying to supercharge the company for growth but not build quality, right?

Pablo Strugo (00:35:46):
By the way, this is kind of a little bit off topic, but it's interesting nonetheless. When did you leave and when did you come back?

Dax Dasilva (00:35:53):
So after 17 years of being CEO, my president took on the CEO title in 2022. And I just returned in 2024. I was two years as the exec chair. And I did a bunch of mental work and film work and came back.

Pablo Strugo (00:36:07):
Is one of the main goals to go to cash flow positive?

Dax Dasilva (00:36:10):
Yep.

Pablo Strugo (00:36:11):
How much did you think about the fund? I mean, fundraising then wasn't what fundraising is now. Like today you have an idea, you raise like $3 million or whatever. It wasn't really the case back then, especially in Canada. But like, how much did you think in those, that early part of the seven years, like, about, you know, should you raise a seed? Should you not? Like, how did you, yeah, how did you walk through that thinking?

Dax Dasilva (00:36:32):
I mean, honestly, I'm probably an edge case here. I just didn't think about it at all because I have no finance background. And we were selling software, making money. And actually, I was buying real estate. Other than the first couple of buildings where there were rentals, I was buying real estate with our profits and just building it like a real. I felt like if anything happened with a software business, I wanted some assets for the company, you know? So I would buy these buildings and rent it to Lightspeed and ended up having some great real estate at the end of it. But I didn't even think about that until later when companies, as we went to the bigger trade shows, when Apple stopped doing the Macworld trade show and we started going to the retail trade show, we started to meet more VCs. And they were like, okay. There's Square that's coming up with a bit more on the mass market. Then there's like ShopKeep, which we eventually later acquired. We were seeing people that were sort of in our space get big investment. And we felt like, okay, then that's not going to be great for us if we don't have the same kind of firepower. We don't have the same kind of connections to Silicon Valley, being out in Montreal. And so that happened very, very quickly with Accel. Within two weeks, we had a term sheet after meeting them at NRF. Well, after two weeks, we met the person again in Montreal, and then two weeks after that, we had a term sheet. So it moved quickly, but I hadn't really thought about it that much.

Pablo Strugo (00:38:14):
This is maybe an impossible thought experiment, but I'm still curious and asking, what do you think would have been different if you had, like in today's environment, let's put it that way, in today's environment, if you had the numbers you had, certainly after two or three years, I mean, almost everybody in your shoes would go out and raise venture. What do you think would have happened if you did? Do you think you would have grown faster? Do you think it actually would have maybe made things worse somehow? Like, again, it's a thought experiment. But curious. On the hypothetical.

Dax Dasilva (00:38:39):
It's an interesting thought experiment for sure. I think there's a couple of things that, well, first of all, the bootstrapping. I think the longer that you bootstrap, just my opinion, the more you solidify your identity as a company. Later, after we were public, we bought, and actually when we were private too as a VC-backed company, we bought three companies, and later we bought almost another 10. And the ability for us to integrate companies from all over the world with different cultures. That, I think, was doable for Lightspeed because of the seven years of bootstrapping and having a really strong core identity. And I think it made us a great company to be acquired by as well. And we had a lot of executives end up being in our top ranks from the acquired companies. So I think that allowed us to also build the product without having a lot of influence by VCs trying to chase a hot trend or pushing you to do this and that. It allowed us to execute on that. famous business plan, you know, without being too distracted. Listen, maybe in year three. That was an interesting moment, actually. Year three, the business plan ran out. And so there was another four years between that and having a venture capital backer. Maybe that would have been a good point to bring in VC. What we did instead is we. There's a thing in Canada called BDC, Business Development Bank. And we've been talking to them about loans if we ever needed one, but we never ended up needing one. It was too high interest anyways, but they did offer a consultant that would come in. The guy's name was Andrew Penny. He would come in once a month, and he would kind of challenge us on all of our decisions, and that ended up being sort of a great bridge to the Series A. Because there was a lot of ways we could have taken the early success, and that was sort of the bridge. But I think in that, if I was to run your thought experiment, maybe that would have been a good moment for the VC, like for Accel to come in because they became, they replaced Andrew Penny, and they were kind of the people challenging us and taking us to another level. In fact, you know, the early days of the Series A, we spent every Friday time. Like an hour or more, talking about how to take the business to the next level. So having some kind of equivalent to that is important, I think, after that initial business one.

Pablo Strugo (00:41:12):
But yeah, I can see both sides of it. Obviously, I'm a seed-stage VC, so I think in many cases it makes sense. But I also can see how, especially in those early days, like being maniacally focused on just product market fit and making customers happy and not having any other stakeholders can kind of just, you know what I mean? You just zoom in on the thing that really matters.

Dax Dasilva (00:41:28):
And I think it probably depends on, you know, if there's alignment with a VC. If, let's say, you do need to, well, that was another part of the business plan, right? The business plan tells you in what year you're going to need to have outside investment to do your plan, right? And I think, because we were able to pay for a lot of the plan. And didn't have bigger ambitions to grow because we were growing up fast. We didn't need to bring in external money. But somebody might write a business plan, and it might say, okay, I do need external, like an early VC to come in. And if there's alignment that you need to stay close to the customer and you need to be able to build that product in that sort of bubble and have somewhat a purity to that, then that could be a great path. 

Pablo Strugo (00:42:15):
And the other question I have is on product. How did your product evolve, especially over those seven years, from what it was at the beginning, kind of on-prem, run your business, to whatever it was on year seven? What did you do on the product through that time?

Dax Dasilva (00:42:27):
So it was an on-prem product the entire time. It wasn't until we brought in a VC that we actually transitioned to the cloud. And that was a huge part of the transformation that we did with Accel that was hugely successful and allowed us to do everything we're doing now. But yeah, I think that first seven years, obviously the product got deeper and richer, and we did a couple of transitions in terms of database and so on. But I think the biggest transition was getting me out of the code. And I think that unlocked a lot of the business. I mean, I felt I had a crisis because I was like, I'm not doing real work anymore. But that was like an important step was to get me into a different. I was sort of CEO/director of development because I still needed to be involved. But yeah, that was like a big part of the transition. It's like, okay, we're going to do Lightspeed 3.0. It was a big moment for us. It was like moving to a lot of new tools, moving to an open-source database instead of all these licenses we were paying for databases. And so we were moving to a whole new architecture, and I really had other developers lead that. Because it now was exceeding my skill set too. Like a lot of the stuff was being built in Python. And so, yeah, that was like a big transition of using the Lightspeed 3.0. I did the 1.0. I did the 2.0. But to get to 3.0, which was an architectural change, letting other people lead that. There was huge step changes for the end user in terms of performance, in terms of scalability. But little did they know, the biggest part of the scaling was getting me out of the picture.

Pablo Strugo (00:44:02):
And then, you know, looking back, these things are hard to see kind of forward-looking, but a lot of easier kind of with the hindsight 2020. Like, often we talk about if you want to create a big business, you need to drive some kind of inflection point, some kind of tech change, like, the Shopify being the other big Canadian success, you know, kind of e-commerce. The wave of e-commerce was kind of what they ended up enabling and also riding. So you kind of make it and ride at the same time. When you think about Lightspeed, what do you think that, was the thing that opened up the space for you?

Dax Dasilva (00:44:28):
I think it would have been post it would have been when we went into the cloud on retail. And that's where we started to be like, because we were so Mac, Mac ecosystem, and tied to the hardware. And listen, there was a lot of room to grow with that. And also in the early days, we actually worked with Apple to bring all the handheld units that they had to do mobile POS. We actually had that for non-Apple retailers, right? So we were able to do a lot of cool things with the on-prem system. But it was being able to go into the cloud that was like a huge step change. Now we could have our software being run on any kind of platform, you know, because at the time, Apple's pretty pervasive now. You see a ton of, like, almost a standard laptop to buy in some regards, but it wasn't.

Pablo Strugo (00:45:19):
Well, I guess that's the question. Like, so you have the second part, which is definitely the cloud, the cloud SaaS being kind of the big wave that you end up riding. Could you argue that kind of the Mac adoption? Because Mac kind of starts with the user, and then they're like, oh, this is great. I'll bring it to my business. But then now you're there. You know what I mean? Was that a big part of what kind of drove you? Drove the business. Sort of like a tailwind for the business.

Dax Dasilva (00:45:40):
Listen, in the bootstrap days, the fact that Apple was having a major resurgence and everybody wanted. Everybody, let's say, you would walk down the street in Soho in New York, and everybody was using an iMac because it was hot. And like, right. So, and there was, like, that was the way you could get an iMac into the store. Right. So the Mac was a huge, huge tailwind. Like Apple's success was a huge tailwind. Having the mobile devices and the iPads later, like Lightspeed Mobile, like all of that, was a huge accelerant. But then there was also a fear that, okay, yes, Apple's on the rise. It's but back then it was nowhere near as pervasive as it is today. Right. And so there was a fear that, okay, we're going to run out of the amount of people that are willing to buy Macs and willing to do a Mac server and willing to. And so by going into the cloud, that was, you know, we were getting tons of tailwind, but also it was like the next step change.

Pablo Strugo (00:46:41):
Perfect. Well, that's super helpful, Dax. I appreciate you sharing the story. We'll stop it there. And then let me just ask kind of the three questions that we always end on. The first one, actually, I'm quite curious on, the answer. When, for you. When did you feel like Lightspeed had true product market fit?

Dax Dasilva (00:46:59):
I think, I mean, there was early indications with early customers that they were able to run their business and they were willing to pay the prices. But I think for me, the moment that I knew that the business had real. There was real excitement and potential was when 43 resellers came to Montreal from Saudi Arabia, and Australia, and Ireland. And all over the US and all over Canada to get trained on a one-year-old system. So they could resell it around, all over the world. I was like, okay, this is, there's something here that is being recognized by people everywhere. I was like, that was a moment where, oh, like, thank God we did this gathering and took a risk, you know?

Pablo Strugo (00:47:43):
And then on the other side, did you? Was there ever a time, especially in those first seven years, where you actually thought maybe this wasn't going to work? Like, maybe you just fail?

Dax Dasilva (00:47:53):
I think there were many moments with early teams where I thought we had to change management a couple of times. Where it felt absolutely like each one could completely fail and could be catastrophic, right? When you're growing that quickly early on, there's people that are coming up in the company that are way more qualified to scale to the next level because you hire them at a different moment. And there's people that are trying to defend their position, especially in an early startup that's having a lot of success. And you have to really carefully navigate those moments. In the first seven years, there were some pretty touchy situations that I felt like the team could fall apart.

Pablo Strugo (00:48:44):
Actually, maybe let me take it. Just a quick tangent on that team. We didn't talk about that at all. Like, how do you think about this concept of, like, A players, B players, you know, promoting from within, promoting from outside? Like, I'm curious if you have any, you know, just high-level thoughts on is that's one area that I see often, especially, I would say. Amongst, first-time founders who haven't had the. They just never worked anywhere, so they don't really know what excellence necessarily is. And it's a struggle, you know, to know if your team is really that great or you think it's really good, but actually there's somebody, you know, 10x better out there you could have instead.

Dax Dasilva (00:49:15):
But, you know, I think it's really one thing to note that I've come to understand is that people might be the exact perfect right A player for a particular moment and a particular period. And then they may be able to do that somewhere at some other company, and they may not be an A player for when you're at the next level of scale, right? And so I think that that is like, there's no A player for every phase of the company. So I know that's like a fun thing to say, like A player is higher, but it's like. And who is the right match for that particular moment of the company? And that's the challenge I was just alluding to is. Like, I had to really be honest about who were the right people. And that's why I didn't give out any equity at the beginning. That's why there weren't founders. It was like, I don't know if these early people are going to be the people that are going to be the right people for Lightspeed at year two, three, four, five, six. And so I don't want to lock into the wrong. We didn't give out equity until. And I know this is not always possible for founders, but we didn't give out equity until much, much, much later.

Pablo Strugo (00:50:26):
You owned 100% for the first, what, few years?

Dax Dasilva (00:50:28):
Yeah.

Pablo Strugo (00:50:29):
Incredible. That's incredible.

Dax Dasilva (00:50:31):
And, and so it did piss people off. But, but we, it was, I was able to make moves on, especially those early years, because you have to get time with those people. You have to let them perform. You have to, like, everything is new, right? With the business. And everybody, like everybody's so enthusiastic at the beginning, and you give people big responsibility, but a lot of people at the beginning end up being jack of all trades and really add value. And you, maybe, there's ways that you can compensate them, but you may need specialized people very quickly. And so that's why I think it's a mistake to go all in on equity too early. And I think you have to be cognizant that you might need to move the pieces around. And there may be people that move with the company through every stage. But they might also have to find different positions in the company. It's not necessarily that your first developer is going to end up being the CTO either. So there's a lot of movement that happens in those early years. And I think you should set yourself up in terms of that equity, in terms of titles. People get crazy titles too quickly. Crazy titles. Everybody has a C-level. Really?

Pablo Strugo (00:51:48):
I see that often. And that's honestly, it's not just giving the title, but it's also building in the expectation. You have somebody who's crushing, let's say, at a head of sales role. And they're like, I want to be a VP of sales or whatever. And you start telling them, oh, yeah, that's the plan. You know what I mean? You start kind of promising these things. You set yourself up for inevitable failure because the odds are not that high that they're the ones that are right for VP sales when you're at $10 million, let alone C-level when you're at 50 or whatever it is.

Dax Dasilva (00:52:15):
Just in the things that we just spoke about in terms of equity, in terms of titles, founders often way complicate their early years by doing too much there. And I don't know. I'm not sure where I got that advice early on. Maybe it was instinctive because I didn't know anything about business. But I think it was early lawyers. I think it was like, there was people saying, I've seen this before. And don't do that. And I think that founders feel a lot of pressure to have co-founders and to have all of this, people helping. And then they have to get out of it later. And they have to bring in somebody, but now there's no title for that person because you're an early friend.

Pablo Strugo (00:52:59):
You have to demote. Yeah, exactly. You're just stuck.

Dax Dasilva (00:53:01):
Then it's like this whole situation that you created.

Pablo Strugo (00:53:04):
So last question, I'm sure you've, you know, over the years, like I said before. I mean, meet tons of founders, give tons of advice. What do you find is maybe one of the most common pieces of advice that you give early-stage startup founders?

Dax Dasilva (00:53:18):
So I spoke about it a little bit earlier, which is like, you know, be willing to throw away that job description every year. You know, be honest with yourself. There's things that you love, the things that you think you're great at, that add the most value to the business. But be ready to do a real assessment of what does the business need from you this year? Who does it need you to be? And if you're not great at those things, the best thing you can actually do for the best performers in your company is show a role model of somebody stepping out of their comfort zone, learning everything that they need to, bringing in great supportive people, but actually being willing to actually challenge themselves in a new place because it's best for the company. And so it's throwing out that job description. And then when you do that, be a listener, you know, like act with humility in your new place. You know, you're not coming in having thrown away your job description. You're not coming in as the expert. You know, when we were going public and I had to like, you know, step into that person that knew a lot about finance, surrounded myself with accountants, you know, and lawyers and absorbed and listened. Throw away the job description, but be humble and listen to people at all levels of the company.

Pablo Strugo (00:54:31):
Awesome. Well, Dax, it's been great to have you on the show, man. Really appreciate you sharing this with all of us.

Dax Dasilva (00:54:36):
Thank you.

Pablo Strugo (00:54:37):
So picture this. It's months from now, years from now, and one of your founder friends, a really close founder friends of yours, guess what? Their startup went bankrupt. And it turns out. If you had just shared the product market fit show with them, they would have learned everything they needed to find product market fit and to create a huge success. But instead, their startup has completely failed. You have blood on your hands. Don't let that happen. You don't want to live like that. It is terrible. So do what you need to do. Tell them about the show. Send it to them. Put it on WhatsApp. Put it on Slack. Put it where you need to put it. Just make sure they know about it and they check it out.