About this episode
Negative 110% gross margins. Then COVID demand spiked 100x overnight - and nearly killed the company anyway. Pat Kinsel spent years chasing product-market fit while losing money on every transaction. When the pandemic brought 100x growth, most of those customers were urgency buyers who churned when COVID ended.
Pat reveals the product-market fit journey behind Proof's rise to nearly $100M ARR - how he used a $0 landing page for market validation before writing code, why 10 years of lobbying across 47 states became a moat competitors cannot replicate, and how losing PMF after COVID forced a complete rebuild around enterprise. You will learn why product-market alignment sometimes has to be found more than once.
Pat previously sold his startup to Twitter and spent time in venture capital. Proof (formerly Notarize) has raised $260M and now serves thousands of enterprise customers across identity verification and transaction security.
? Key Lessons
? Validate product-market fit before writing code: Pat built a $0 Unbounce landing page and ran Google Ads to prove people searched for online notary services - measuring acquisition costs and conversion rates first.
? Fix unit economics before scale arrives: Proof had negative 110% gross margins, losing money on every transaction. They reached 1% margins just before COVID spiked demand 100x.
?? Turn regulatory complexity into a durable moat: Pat lobbied for 10 years to change laws in 47 states. This red tape became a barrier competitors cannot replicate.
?? Urgency buyers do not equal product-market fit: COVID brought 100x demand, but many customers signed for business continuity, not strategy. When the pandemic ended, they churned.
? Expand TAM by evolving from point solution to platform: Rebranding from Notarize to Proof opened identity verification, fraud prevention, and e-signatures - finding product-market fit again in enterprise transaction security.
Chapters
Introduction and favorite quote
What Proof does and the business of certainty
Revenue, team size, and funding ($260M raised)
Origin story: The notary error that sparked the idea
Validating demand with a landing page and Google Ads
The first MVP: A mobile app for online notary
Slow early growth: 3 years to product-market fit at $1M ARR
Negative 110% gross margins and fixing unit economics
COVID hits: 100x demand spike overnight
Post-COVID reality: Customers churned when urgency faded
Rebranding from Notarize to Proof
Lightning round
Resources
Full show notes: https://saasclub.io/452
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