Internal Tools Market Opportunity

Sam Parr shares insights about Retool, a company that builds internal tools for businesses. He emphasizes the massive market opportunity in internal tooling, which is often overlooked despite representing a majority of software usage in companies.

Key Points:

• Market Size and Opportunity:

  • 50-60% of all software in the world is internal-facing tools
  • This market is underserved because people focus on consumer-facing products
  • Internal tools are less visible but crucial for business operations

• Company Overview:

  • Founded by David at University of Cambridge
  • Latest valuation: $3.7 billion
  • Raised $150 million from Sequoia and other investors

• Growth Trajectory:

  • First 9 months (2018): $500,000 in revenue
  • 2018: Hit $2 million in ARR
  • 2024: Reached approximately $100 million in recurring revenue

• Founder Background:

  • Started company while at University of Cambridge
  • Previously built a successful payments app at age 19
  • Shows early signs of exceptional capability

• Product Value:

  • Makes it easy for companies to build internal admin tools
  • Allows non-developers to make changes to backend systems
  • Reduces development time for internal tooling
  • Solves common problem of developers not wanting to work on internal tools

• Investment Thesis:

  • Market is massive and growing
  • Product solves a universal problem
  • Strong founder with proven track record
  • Potential for 5-10x growth from current valuation