SaaS Interviews with CEOs, Startups, Founders
1200 How He Got First 250 Customers, $65k in MRR from South Africa HQ
06 Nov 2018
Chapter 1: What is Procurement Express and how did it start?
care for what you wish for you just might get it so you might as well wish for a lot found that his company again procurement express back in 2014 now 20 people based between africa pakistan dublin again making and helping you spend your money more effectively more efficiently tracking all kinds of stuff built in to make that a smooth process 250 customers closed to date uh doing about 33 grand per month 12 months ago now well north of double that at 65 grand per month two percent gross logo churn
per month getting paid back in about four months they're spending up to 800 bucks to acquire a new customer that pays 260 bucks a month healthy economics this is the top entrepreneurs podcast where founders share how they started their companies and got filthy rich or crash and burn
Each episode features revenue numbers, customer counts, and other insider information that creates business news headlines. We went from a couple hundred thousand dollars to 2.7 million. I had no money when I started the company.
It was $160 million, which is the size of many IPOs.
We're a bit strapped. We have like 22,000 customers. With over 5 million downloads in a very short amount of time, major outlets like Inc. are calling us the fastest growing business show on iTunes. I'm your host, Nathan Latka, and here's today's episode. Hello, everyone. My guest today is James Kennedy.
He is the founder and CEO of a company called Procurement Express, which is helping make company spending more efficient and faster. James, are you ready to take us to the top?
Yeah, I'm very excited.
All right, Nathan. Yeah, so where are you based this morning?
I'm speaking to you from a sheep farming town, 200 kilometers from the nearest coffee machine in rural South Africa.
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Chapter 2: How did the founder acquire the first customers?
So then diving into some of the economics, I mean, obviously you're about $65,000 today in terms of monthly recurring revenue.
Chapter 3: What is the business model and pricing strategy for Procurement Express?
What were you at 12 months ago? What's your growth rate?
We've about doubled in the last year.
Okay, so call it, you know, 33 grand in December 2016, and now you're north of 65.
territory.
That's great. Okay, good. And what about economics wise? So when you're you know, you're bringing on these new customers, what are you paying on average? What's your fully weighted CAC?
Well, we aim at $800. Obviously, it all depends on the channel. Why is that your aim? Because that's just, you know, if you go back to Jason's talk, 2013 MicroConf, and, you know, Jason Cohen, he says, listen, this is the model. It's all very well known. You pay $40 per lead. You know, you convert between $10 and $20, $1 and $10 and $1 and $20 of those.
That'll give you, you know, between $400 and $800 in sort of CAC. And then that's, you know, should be around, you know, three to six months. It was his aim worth of sort of payments, you know, payback time. And that's what you aim for. Yeah. A lot of those numbers are out there, well-known, well-understood, and we don't try to innovate that much on price because why bother?
There's a difference between knowing the numbers and actually building a real business around the numbers. Those are not easy, otherwise everyone would have a successful company.
Well, the big thing is your conversion rate. Do you convert 1 in 20 or 1 in 100? That's where it all falls down.
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Chapter 4: What are the customer acquisition costs and revenue metrics?
Segment.com. Yeah. Number four, how many hours of sleep do you get every night? last night eight okay and what's your situation married single you have kids married two kids two kiddos good and are they sheep farmers yet or no uh they may go that way but not yet all right and how and how old are you james all right last question what do you wish your 20 year old self knew
Set bigger goals. Whatever you go for, you're surprised how easily you do get there. Maybe it just takes a bit longer than you thought.
Care for what you wish for. You just might get it, so you might as well wish for a lot. Founded his company, again, Procurement Express back in 2014. Now 20 people. based between Africa, Pakistan, Dublin, again, making and helping you spend your money more effectively, more efficiently, tracking all kinds of stuff built in to make that a smooth process.
250 customers closed to date, doing about 33 grand per month 12 months ago. Now, well north of double that at 65 grand per month, 2% gross logo churn per month, getting paid back in about four months. They're spending up to 800 bucks to acquire a new customer that pays 260 bucks a month. Healthy economics. James, thank you for taking us to the top.
Thanks, buddy.
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