SaaS Interviews with CEOs, Startups, Founders
1516 With $150k in MRR, He's Helping 40k Event Organizers Market
18 Sep 2019
Chapter 1: What is the main topic discussed in this episode?
Launched event back in 2012. Today, working with 3,000 customers, paying $50 a month. So $150,000 per month just on their SaaS product. That makes up 50% of their total revenue. That's up from $50,000 per month about a year ago.
Chapter 2: How did the founder achieve $150k in MRR?
So 3x year-over-year growth. That's healthy. $800,000 raised to build this thing. They'll spend $15 fully weighted to get a new $50, $50 a month customer. 14% revenue churn per year. Team of nine folks based between London and the U.S. Hello, everyone. My guest today is Richard Green.
He's the founder and CEO of a company called Event, a platform looking to change an industry through creating an affordable service where one simply did not exist before. He loves challenging the norm and trying to change the world one event at a time. Richard, are you ready to take us to the top? Yeah. All right. This is a tough space. Events come and go. Sometimes they don't stay.
Churn is always an issue. Tell us what your company does and how you're adding value to the space. So an event submission, you're right, it expires. You have a very short amount of time to make that event successful. Our proposition really is around making sure the event hits the most amount of consumers in that short amount of time.
So if you look at Austin, where you're based, we're live on Austin 360. We're working the product from being a submit once to the local newspaper online to being also distributed through a syndicated network of event listing sites. So you're on every listing site where there's consumers. That gets you, by default, exceptional placement in Google, so you get search.
We're also moving content to the newspaper, so if you buy online, you appear in print. And lastly, with some of the newspapers we're working with, you have relationships with a company called Spoken Layer, and we can also get those events into voice. So if you're in Austin, you submit an event to the paper yesterday, no one's going to see it.
But if you submit it today through our relationships with newspapers, you're on the website, you're featured, you're distributed, you're imprint and you're on voice. So if you're asking Siri or Alexa where to go tonight, that information is around you. We think that's a good product. And what's your model? Is it a SaaS company? We're a SaaS based platform. Yes. Okay. Sorry.
I was going to say, yeah. So what's the average customer pay you per month for this? Well, we've tried to get into a pure play subscription model, but a lot of people want to just submit an event. So our model is that we allow people to submit an event, a bundle of events, and also they can get onto subscription plans. A single event's a festival.
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Chapter 3: What unique value does Evvnt provide to event organizers?
They don't want a monthly deal. If you're running training courses, you want a bundle. You don't want to be on a monthly or a single. So we also have subscription. The subscription deal is obviously better price. You get about a 50% discount on the subscription. Average price of an event, anywhere from $25 to promote an event up to a thousand, depending on the category location.
So people on your subscription plans, on average, what are they paying per month? 50 to 60 bucks. Okay. And what are they getting for that? They can submit up to four events per month. Okay. So this to me is like any company that is doing four events per month, typically it's going to be, I guess, a very large company, right? That's a lot of events. It's a lot of overhead.
It's a lot of planning, but your price doesn't reflect that because it's 50 bucks. It's like SMB pricing almost, right? So like, how do you, don't you tap out eventually? I mean, there aren't that many companies that do four events every month, is there? It's the local market. So when you look at the market at large, 98% of the market's local.
Yes, you're thinking Britney Spears and Live Nation, and you're thinking these big festival companies. That actually qualifies for 2% of the market in terms of the events that are actually happening. If you think about Austin, there's 5,000 events roughly that we think go on every month. Those companies running those events are venues. So you think about the comedy, the live music, the nightlife.
That's really where we're focusing our attention. We're not trying to help the big guys. The big guys have got big budgets and they're already using lots of different tools and they've got big brand names. What I'm trying to assist with is the local events. And if you're a local comedy club, you're probably running two to three events a week.
So you probably need a package that's somewhere between 12 and 16 events a month. So it has to be affordable. Otherwise, we're just producing SaaS software for a niche market. So how many customers are you working with today on just the SaaS product? We have around 39,000 customers worldwide that use events platform. In terms of on the SaaS solution itself, around 3,000. Okay, 3,000. Got it.
And when you say the 39,000 number, is that in the past 12 months, someone has paid you at least a dollar to run at least one event? Well, our total customer base is over the last six years. So we're targeting the U.S. market. Obviously, it's a big market to attack. Our product today has been sold predominantly in over 139 countries.
So it's something that's been organically available and we have customers all over the world. However, we are now targeting local newspapers and we're directing our affordable marketing offering into the local markets through companies like Gatehouse, as I mentioned previously. So Richard, just to be clear, today you have 3,000 customers that are paying on your subscription, your monthly plan.
That's correct. Okay, so multiplied by 50, that's about 150 grand per month in revenue right now on that plan, is that right? That's correct. Okay, and what percent of your total revenue comes from the SaaS offering? Our SaaS business today is about 50%. The other 50% comes from people that, you have to remember, people don't just sign up, I think, to services today.
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Chapter 4: How does Evvnt's pricing model work?
Any technology company on the market today is challenged by customer acquisition. One of the luxuries we have is that there's 65 million events being submitted onto the web every year. And what we're trying to do is get into the workflow of those events submissions. So by working with newspapers, providing them event calendars,
and allowing local audiences to submit locally and access our products really has a zero cost of acquisition. And that's really where we're focusing over the next 12 to 24 months strategically. So it has zero direct cost of acquisition, but if you do fully weighted and you account for your team's time and the phone calls and the travel and things like that, it does have a CAC.
I mean, so what would you say your fully weighted CAC is to get a new $50 a month account? Well, we put that in at about 60% right now. Net margins are sitting at 92%, but we think it drops it down to 60% if you think about the cost of the build.
However, that build in terms of our strategy to come into the US market with event calendars to access events organizers who want to promote events, that technology build is now over the hump. We released with Gatehouse two weeks ago. We went live with 472 calendars, including the Statesman in Austin, Austin 360. We went live from zero to 476 calendars within an hour.
So the technology is starting to scale based upon that initial investment. Okay, but Richard, sorry, I don't understand. My question was to get a new $50 a month account, what are you paying to acquire that customer fully weighted? Your answer was 92% net margin and 60% gross. I don't understand how that answers the cat question. Oh, I see in terms of cost per acquisition. Yeah.
Cost per acquisition in the business today is probably about 20%. It's not high. 20% of what? Of the price that they come in on. So at 50 pounds, you're looking at about $15 to acquire a customer. Okay, got it. So you're getting paid back in the first month. I'm sorry, I look at everything as a percentage of the revenue coming in. But yeah, it's about $15 based on a $50 transaction. Got it.
You know, I mean, that's an extremely fast payback period, though. One month is, I mean, most SaaS companies, they're looking at six 12-month payback periods. So they would spend 500 bucks to get a new $50 a month customer. Yeah. As I say, you know, there's two options.
You either spend, if I was, if I was trying to acquire customers through paid advertising on Google or Facebook, I'm sure my cost of acquisition will be very- It's not just that though. I'm talking fully weighted, which also means your team members that are flying around to Austin to close these deals. We do everything. We have people that operate from Houston, but we don't fly them around.
We do everything over Zoom. We speak to clients directly over the internet. We have a very lean operation. How many people on the team? We have in London, we have seven and we have two here in the US at the moment. Okay. London and the US. So you just had what? Nine people total then? That's correct. And are you the sole founder or you have a founding team? No, sole founder. Oh, that's great.
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