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A horizontal adtech company at $10M ARR noticed that its stickiest 30% were all flooring retailers, bought the partner who supplied them, burned the rest of the business down to $3M, rolled up eight flooring software companies, and reached roughly $30M ARR before selling to a private equity rollup.
$10M ARR as horizontal adtech in 2019 → $3M after going all-in on flooring → $12M by 2021 · ~4,000 website customers, ~3,000 CRM customers, ~1,000 ERP customers · websites at ~$1,200/mo average, full website + CRM + ERP platform at ~$3,000/mo · 40% of revenue closed at conferences · flooring cohort held 90% logo retention and 105% net revenue retention against 60% and 80% for everyone else
"51% of the reason people signed up for us was the Broadlume brand and 49% was the product." He unfriended almost everyone on his personal Facebook so he could friend flooring retailers instead, and ended up able to ping 4,000 of them with a single post.
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Todd Saunders was at Google from 2013 to 2015 and met his cofounder there in 2014. They left to build what they describe as a TurboTax for digital advertising, got into Techstars with two non-technical founders and an idea, raised a seed and then an A, and by 2019 were doing about $10M ARR. It could have been profitable; they were spending on growth instead. The problem was the shape of the business. Horizontal adtech meant tens of millions of theoretically addressable advertisers, customers who stayed six to eight months if you were lucky, and a competitor every quarter promising a $1 cost per conversion. Then in 2018 they looked properly at their own customer list for the first time. Roughly 30% of the business was flooring retailers, all of them arriving through one channel partner — a website company called Floor Force. That cohort was at 90% logo retention and 105% net revenue retention. Everyone else was at 60% and 80%. They bought Floor Force, ran two companies badly for a year, and at the end of 2019 shut the adtech business entirely. Revenue fell from $10M to $3M. Three months later COVID arrived, which would have taken adtech to zero and instead sent home improvement spending vertical. Flooring went from $3M to $12M by 2021. A growth equity round from PSG funded seven more acquisitions — website, CRM, ERP, visualisation, payments — plus a private-label flooring brand, and the company reached roughly $30M ARR by 2024 before selling to a private equity rollup.
The first flooring customers were not sold; they were bought.
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“The business was doing like 10 million in ARR and like could have been very profitable, but like we were investing a lot in growth.”
27:57 · hear it in the video“…to a full platform like website CRM ERP for like $3,000 a month.”
40:32 · hear it in the videoData credibility: Guest interview on the Verticals podcast, November 2025, with English auto-captions. Every number is stated by Todd Saunders about his own company and is self-reported and unaudited: $10M ARR as adtech in 2019, the drop to $3M, $12M by 2021, roughly $30M ARR at exit, about 4,000 website / 3,000 CRM / 1,000 ERP customers, $300 → $1,200 → $3,000 a month pricing, 40% of revenue at conferences, 90% logo retention and 105% NRR in the flooring cohort against 60% and 80% elsewhere, 100 showrooms carrying 1,800 SKUs of private-label product at a 10% transaction take, 20 million consumers a year on the retailer websites, and about $30B of sales represented by those retailers. The market sizing he cites — 10,000 to 25,000 US flooring retailers and $80B a year spent on flooring — is his own figure and we did not verify it. The auto-captions garble the company name throughout, rendering it as Broadboom, Broadloom, Broadland, Broadam and Broad; the business is Broadlume, the flooring vertical SaaS company Saunders founded by pivoting his adtech startup, which the captions call "Ad Hoc". The ERP customer count is transcribed as "a,000", which we have read as 1,000 given the surrounding numbers; treat it as approximate. The name of the private equity buyer is garbled in the captions as "Sinkley" and we have not identified it, so we describe it only as a private equity rollup. Growth rates he gives (100%, then 60%, then 30-50% a year) and the exit-multiple ranges (four to six times ARR for private equity, roughly eight times for software revenue, ten times for venture-priced deals) are his own read on his own deal, not published data. Saunders gives Floor Force's age as "20 years or 10 years at that point" in the same sentence, so we have not fixed a number on it.
The first flooring dollars were $300-a-month websites, sold by Floor Force to retailers who were already paying the adtech side to run their Google spend. That price was a floor rather than a ceiling.
Two loops compounded. The first was content that was deliberately not about the product: webinars on getting a PPP loan, on using ChatGPT, on tricks inside a retailer's own accounts.
The dead stretch ran from 2018 into early 2020 and it was genuinely bad. Through 2018 they operated two companies at once with no strategy and bled money.
Broadlume ended up as the full operating stack for an independent flooring retailer, assembled by acquisition rather than by roadmap. The layers were websites, a CRM, an ERP, a room visualisation tool and payments — eight companies in total, starting with Floor Force in 2019 and seven more after the PSG round. Saunders is candid that these were not world-class products individually. What he bought was distribution and legitimacy: roughly 50% customers, 40% domain expertise and industry access, 10% product. He also draws a distinction worth stealing. Broadlume was an ecosystem, not a platform — the pieces worked together but never fused into a single seamless system the way a Service Titan does. Our read: that is the honest trade in a rollup. You get to market years faster and you get the founders' relationships, but you inherit five codebases, five data models and five support cultures, and the integration debt shows up exactly when a private equity buyer starts diligence. The other half of the product was not software at all. It was a public phone number, a Facebook group, a conference, and a CEO who would spend forty-five minutes on the phone with a retailer he had never met. Saunders puts the brand at 51% of the buying decision and the product at 49%, which is either a confession or a strategy depending on how you read it.
Three stacked revenue lines. First, subscription software on a price ladder that climbed from $300 a month for a website to about $1,200 a month on average, and to roughly $3,000 a month for website plus CRM plus ERP — a roughly tenfold increase in ticket against the same customer base of about 4,000 website, 3,000 CRM and 1,000 ERP accounts. Second, the manufacturer side. With 4,000 retailer websites and 20 million consumers a year hitting them, manufacturers wanted placement, and Broadlume started selling an elevated brand experience across the network at around $20,000 a month per manufacturer. Third, and this is the interesting one, they converted that placement money into transaction economics. Rather than run a hundred new manufacturer sub-brands, they created four brands they owned themselves, told manufacturers to contribute twenty products each, and let their own account managers open retailer accounts by email. A year later about 100 showrooms carried 1,800 SKUs of Broadlume-owned product and the company was taking 10% of the transaction while holding no inventory. Saunders compares it directly to payment processing, where you fight for 75 basis points; he was taking ten points for being the gatekeeper between manufacturer and retailer. The catch came at exit: the private equity buyer valued that line at roughly 2x as "reoccurring" revenue while paying around 8x for recurring software, and then re-marked it as SaaS revenue afterwards. His broader lesson is that vertical software gets big by taking a slice of the money moving through the industry — the retailers on his network represented about $30B of sales — not by multiplying a per-seat fee by the number of seats.
The transcript is thin on infrastructure and specific about the cost structure that mattered. Marketing was four people — a VP, a manager and two video people — producing webinars, conference B-roll and a filmed FloorCon that 700 people watched live in 2020 with gift boxes mailed out in advance. Conferences consumed a lot of money and returned 40% of revenue. Sales stayed warm until about $20M ARR, which is the single biggest cost line most vertical SaaS companies carry and Broadlume largely did not. On margins, Saunders' advice to anyone building here is deliberately counter-cultural: do not squeeze for a 90% gross margin. Run at 80%, put the difference into R&D and into humans who answer the phone in English and know the trade, and use AI internally to make yourself efficient rather than bolting it onto the product. Our read: that is a defensible position in a market where the customer is moving off pen and paper, but it caps what a financial buyer will pay, and Broadlume's own exit shows how sharply buyers discount anything that is not clean subscription revenue. The transactional flooring-brand line was worth about 2x to the private equity buyer against roughly 8x for software. If you deliberately run at 80% margins with a services-heavy support model, you are optimising for customer love and growth, and you should expect to be paid on a four-to-six times ARR multiple rather than ten.
Copy the diagnosis first. Broadlume's entire pivot came from sorting an existing customer list by retention and finding one cohort at 90% logo retention and 105% NRR inside a business averaging 60% and 80%. That analysis costs an afternoon and almost nobody runs it. Copy the community mechanics too, because they are nearly free and still underused: a Facebook group named after what the industry calls itself rather than after your campaign, a founder's phone number posted in public, content about the customer's business rather than your features, and one owned event a year. Copy the pricing ladder — $300 to $1,200 to $3,000 a month against the same accounts. What to change: almost nobody reading this can run an eight-company rollup, and you should not try. The replicable version is the one Saunders himself points at for 2026. Private equity has now rolled up most verticals and pushed NPS to the floor; operating costs are far lower with AI doing internal work; and the customers in trades are still on pen and paper. Pick one sub-vertical — not "trades", which he counts as fifty industries, and not "restaurants" but pizzerias — build a decent CRM with good UX, answer the phone, and take 20 to 30% of an incumbent's unhappy base. Change one more thing: do the transaction-economics work early and structure it as cleanly recurring, because Broadlume built a 10%-of-transaction line that customers loved and buyers discounted to 2x.
The near-death moments were financing, not product. A Series A lead pulled out at the last minute and only a bridge from a customer kept the company going; across every round there was never a competing term sheet, which means the company was one investor's change of mind away from ending at any point. That is the first risk in any niche vertical: the capital market for "software for flooring retailers" is one deep, not ten. The second is concentration. Broadlume bought its way into the industry through a single channel partner, and if Floor Force had sold to someone else the pivot had no on-ramp. The third is the pivot itself: revenue fell 60 to 70% by design, and the recovery was substantially handed to them by a home-improvement boom during COVID that nobody forecast. Saunders says outright that without the pivot the adtech business would have gone to zero — but the reverse timing risk is real, and most people cutting 70% of revenue do not get a pandemic-scale tailwind three months later. The fourth is exit structure. Our read: the transactional revenue line was genuinely clever and genuinely punished, valued at roughly 2x against 8x for software, and a founder who builds a lot of that revenue without understanding who eventually buys it can lose a large fraction of enterprise value. Saunders' own warning is the sharpest version: most vertical SaaS companies are bought by private equity at four to six times ARR, so if your cap table only works at a ten times outcome, you have already made the fatal decision.
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