Bebo to Milk Road Profitability

Shaan tells a story contrasting his experience running two different companies - Bebo with high burn rate versus Milk Road's lean approach.

"When I was doing Bebo, we had a $3 million annual burn rate pre-product market fit. We had a team of engineers in Silicon Valley - about 10-12 engineers costing around $240,000 a month in burn. That's net burn. When you hire 10 people at $200,000 each, you're doing $2 million plus rent, cloud bills, and everything else. Those were all Silicon Valley engineers and they were below market - those people could have been making $400-500k at Facebook.

Then with Milk Road, we were profitable from day one. I remember coming to your office at The Hustle and you had like 15 people running around in San Francisco. That's a bunch of San Francisco issues - they have to go home and pay $6,000 rent so you gotta pay them money. For us, we had one person in the US for Milk Road and everybody else in the Philippines. It was a lean, mean, profitable machine.

Not just cost savings - if you hire somebody in the Philippines they're basically 10 times cheaper than the US. You can hire somebody in the Philippines for $1,000 a month, so $12,000 in a year. That same person in the US will cost you $80-120k. And these are skilled people - in LatAm, the guy we have doing our data stuff has his MBA, he's like a wizard with Power BI and Looker and all these data tools that I couldn't even start to use."