Eden Data: a $15.98 Upwork profile became a $6M-a-year business in two years
Taylor Hersom quit his security job in February 2020, right after buying a house and a car and getting engaged. Then COVID hit and every interview dried up. He paid $15.98 for an Upwork premium profile, applied for everything, and two years later his company Eden Data was on track for over $6 million a year, bootstrapped, with no sales team.
Overview
Eden Data takes over security and compliance for startups. Startups have regulators to satisfy, big customers who demand security checks before they sign, and attackers to keep out. Eden Data handles all of it for a monthly subscription, instead of billing by the hour like a consulting firm.
It was founded in January 2021. At the time of the interview it was on track for over $6 million that year, had served more than 100 customers, had 15 employees and about 30 people including contractors, was fully remote, and had never raised money or hired a salesperson. Growth was 300% a year.
When people ask how much he invested to start it, he says "$15.98." That was the price of his Upwork premium profile.
Before Eden Data
He went to school at the University of Montana and got recruited by Deloitte to audit the IT of Fortune 100 companies. "I was just happy to get a job and had no idea wtf IT auditing was." It was not fun, but it led to cybersecurity work just as companies started caring about it. Then he became the head of security at a firm in Austin.
He did not love that job either, and quit the last week of February 2020 with interviews lined up. Then COVID hit. He and his girlfriend had just bought a house and a new car and gotten engaged. Every interview disappeared, "and my better half was telling me I better get my shiz figured out!"
The Upwork months
He found Upwork and was surprised how many startups were posting security jobs. Security is a big field and he had never done most of these tasks. "I had Google on my side, so I just applied for EVERYTHING."
He did his first few projects very cheap, in exchange for an agreement that the client would leave him a great review, because reviews are what push you up Upwork's rankings. All through 2020 he did not think of it as a company. He felt like he did not know what he was doing, so he kept trying new things and learning.
The retainer trick
Upwork makes you enter an hourly rate when you apply. He would enter a ridiculously high number, then write in his note something like: "if you decide to let this horse hitch to your wagon, I'll work out a monthly retainer rate instead of my ridiculously high hourly rate."
The high hourly number made the monthly retainer look like a deal. It took a lot of tweaking, but it let him scale fast, and those Upwork clients became the test bed for the subscription model the whole company now runs on.
By September 2020 he had too much work. He had served some impressive startups and seen a world he never knew existed. Security jobs on Upwork kept growing. So he thought: "Maybe I can start a business."
Turning it into a company
It took a few months to line up contractors and employees, form the company, build a website and figure out how to hire legally. Eden Data launched in January 2021.
There was no launch event. His Upwork clients were already fans and simply moved over from "Taylor Hersom" to "Eden Data." For about six months some leads still came through Upwork, and he messaged random people on LinkedIn asking to partner. Partners were how he got off Upwork, whose commission was eating into margins.
He spent a lot of time on the website and learned that almost nobody visited it. "Our type of business needed relationships instead of a pretty website."
Pricing on the website
The first versions were rough. Everyone is trained to pay professionals by the hour, and clients kept asking how many hours his team worked. He built a pitch around a simple point: big firms are paid by the hour, so they are rewarded for taking as long as possible. A subscription firm is rewarded for being efficient.
Early on he created three subscription packages, Seed, Sprout and Sapling, and put the prices on the website. That is almost unheard of in professional services, where prices usually come "like the 37th sales call" and only as estimates.
He also set out to serve startups of any size, while almost every B2B firm chases mid-size and large companies. Because customers paid a flat subscription, he was in effect being paid to test new services. If something took ten times longer than expected, the customer did not pay more, so both sides were fine with experimenting.
How it grew
He thought he needed ads, SEO and polished marketing. What he needed was a decent website he was not ashamed to send people to, and partners.
Partners who already had his customers. An audit firm that audited many of the same startups became a big source of leads. A compliance software company called Drata, founded the same year, made his team's work easier and became one of his best referral sources as it grew into a large company.
His own LinkedIn. People reach out after seeing his posts, and his biggest recent partnership started that way.
Starter Story. Eden Data was featured on Starter Story twice, and that is the article people mention most when they say they read about the company online.
Service people do not leave. The paid SEO and PR did not move the needle. Retention did. Customers usually hire Eden Data to meet a contract or pass an audit their own customer demanded, and once that is in place it has to be maintained forever. "The effort is a loop and not a line." They had lost only a single-digit number of customers.
Flexible contracts. Startups change quickly, so he made contracts easy to adjust and kept the scope broad on purpose, so his team can help with new problems without renegotiating.
The model
Service businesses usually sell for one to two times revenue, because hourly and project revenue is unpredictable. He wanted none of that. He dropped project work entirely and kept only subscriptions, which makes revenue predictable and the company worth more. New services are added only if they fit inside the existing subscriptions. Software is passed to customers at cost; the money is made on the service.
He keeps looking for work a person should not have to do, for three reasons: margins, lower prices for customers, and less burnout, "because we humans never like to do the same thing over and over again." The company also runs on Asana for client projects, Slack Connect so clients can reach the team instantly, and profit sharing for employees who exceed their targets.
The hard parts
He had an "oh shit" moment "about three times a week." For a long time he was convinced nobody would accept a subscription and that he was bad at explaining it. People signed anyway, because they usually reached him when they had an urgent problem.
He had to part ways with the first two people he hired to help build the company and thought the business would not survive. It did: other employees stepped up, and no customers or staff left over it. His lesson: he thought he needed business partners because he felt he did not know enough, and that set people up to fail because he kept moving the target.
The numbers
| Figure | Number |
|---|---|
| Starting cost | $15.98 (Upwork premium profile) |
| Quit his job | Last week of February 2020 |
| Company founded | January 2021 |
| Revenue | On track for $6M+ in its third year |
| Growth | 300% a year |
| Customers served | 100+ |
| Team | 15 employees, about 30 with contractors |
| Sales team | None |
| Outside funding | None |
| Packages | Seed, Sprout, Sapling, priced on the website |
| Customers lost | A single-digit number |
Do what he did: step by step
1. Pick the skill your last job gave you.
Do this: his was security from Deloitte. Yours might be bookkeeping, recruiting, marketing ops, IT, design, data. Choose something startups and small businesses need but cannot hire full-time for.
2. Get on a marketplace and apply to everything nearby.
Do this: set up an Upwork or Contra profile. Apply to every job close to your skill, even ones you have not done before. Learn as you go.
3. Trade your first prices for reviews.
Do this: take the first few jobs cheap, and agree up front that the client leaves a detailed review if you deliver. Reviews are what get you ranked and hired.
The message, word for word:
"I'm newer on Upwork, so I'll do this at [low price]. In return, if you're happy with the work, I'd ask for an honest, detailed review. If you're not happy, you don't pay."
4. Use the hourly box to sell a retainer.
Do this: enter a high hourly rate, then offer a monthly retainer in your note. The high hourly number makes the retainer feel like the better deal.
The note, word for word:
"My hourly rate is listed high on purpose. If you'd like ongoing help, I'll do this for a flat monthly fee instead: [what's included], for [price] a month. You'll always know the cost, and I'm rewarded for getting things done fast, not for taking longer."
5. Package it and publish the price.
Do this: turn your retainer into two or three named tiers with prices on your website. Buyers who are used to waiting for a quote trust a price they can see.
6. Move clients off the marketplace with partners.
Do this: find businesses that serve the same customers but do not compete with you: software tools, auditors, accountants, agencies. Offer to send work both ways.
7. Pick work your clients can never stop needing.
Do this: compliance, bookkeeping, IT, payroll and security are loops, not lines. Clients keep paying as long as you do good work, without long contracts.
8. Post about the work on LinkedIn.
Do this: write about the problems you solve. His biggest partnership came from someone who read his posts.
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Sources
- Hampton, "Bootstrapping An UpWork Hustle Into A $6m+ Business In Two Years," interview with Taylor Hersom
