SaaS Interviews with CEOs, Startups, Founders
1555 This Rome Based Company Helps You Build Business Apps Fast, $25k in MRR, $1.3m Raised
27 Oct 2019
Chapter 1: What is the background of Antonio Leoforte and his companies?
Launched in 2008, F Host again, serving up and helping about 30 developers and end customers that pay on average 10 grand per year, doing about 25 grand per month right now. They also do a significant portion of consulting work. So they'll do about 1.5 million this year, up from 1.1 million bucks last year. Team of 25 people based in Rome. Hello, everyone. My guest today is Antonio Leoforte.
He has a master's degree in electronic engineering in 1992, worked initially in the aerospace industry in Italy, England, and the Netherlands. He founded his first company in 1995, then launched his current company, F. Hoster, in 2008, raised $1.2 million from private investors and a VC fund, and then recently a company in the IoT industry. Antonio, are you ready to take us to the top?
Yeah, I hope so. That's my effort. Good. All right. So what are you mainly focused on right now? F-Hoster or this IoT company? No, actually F-Hoster has a development plan to enter the IoT field. We're not focused on the IoT now. But that's one of the development horizon that we have. Okay, so F-Hoster is your main focus.
Explain to us kind of what the company does and specifically, what's your revenue model? Is it a pure play SaaS company? It's a platform as a service company, yes. And the business of the platform is providing developers with an innovative way to create business management information system in a much faster way.
And what we do have is a web-based platform allowing developers to model their applications and turn them into executable applications in a matter of minutes from conceptual models, not by coding. Okay, and what does kind of the average company or developer pay you per month or per year to use this software? Well, we have accounts ranging from $5,000 per year to $70,000 per year.
What would you say is a fair average? The average, I would say, is around $10,000 per year. $10,000 per year. Okay, very good. And this is mainly development teams paying you? Well, we do have customers who are developers themselves, but we also have... and customers. So in that case, we've got an internal department using the platform internally to develop the final solution.
And in that case, we get paid for the modeling as well. I see. So we've got both the business models. We provide the tool for creating applications so that other system integrators can use the platform or we use it ourselves to deliver final solutions to the customer. I see. Okay. You launched the company in 2008. And how many employees are you at today? Are team members today?
Today, we are 25 people. Okay. Where is everyone based?
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Chapter 2: How does F-Hoster help developers create business apps?
We are based in Rome, Italy. Oh, Rome. Very good. Beautiful place, huh? Yeah, it is. Yeah, there's a lot of traffic. It's not so easy to live in Rome. It's better to be a tourist here. But we managed to make business as well. That's great. And how many customers have you scaled to today? Well, the main... We got 80% of the revenues come from about 12 customers at this point in time.
So not that much. We focused, we initially, we try to exploit these very small business and micro companies. But then in the end, we realized that our best market is in medium or large organizations. Okay, so 12 enterprises. But when you look at your entire customer base, how many total customers? Uh, I think they're about 30 now. Three zero.
Chapter 3: What is the revenue model of F-Hoster?
Okay. So, I mean, can I take 30 times a $10,000 kind of per year average you gave me? And you guys are doing about 25 grand a month right now, something like that. The last, the, the average we, the last year we made 1.1 million in, uh, in, uh, in revenues. And the licenses from just pure licensing, you know, licensing of the platform to developers were about $250,000.
And the rest is from consultancy. So services provided to customers for creating their applications. Okay, so just to be clear, and last year you did $250,000 in total just software sales and then about, call it $900,000 in consulting on top of that. That's correct. Okay, so this, like today, like last month, how much revenue are you doing per month just on the software, not consulting?
Well, I would say just on software licenses, well, I think we are in the order of of, let me think, about 20, 25,000 in this month. Yeah, that'd be about 30 customers, again, paying 10 grand per year, which is about 800 bucks per month. So 800 times 30 comes out to about $25,000 per month. That sounds about right. Have you done this bootstrapped, Antonio, or have you raised capital?
No, we raised capital. We raised 1.3 million in dollars in two different rounds. We made a seed round of about a quarter of a million. And then the rest in the second round. Okay. And this year, 2018, how much total revenue will you end with? Last year you did $1.1 million. I don't know because we are investing a lot. And so we are in the development of the platform.
Sorry, I don't mean bottom line. I mean top line, revenue, top line. I hope we will make $1.5 million. Okay. I mean, but there's only like 30 days left in the year. So you shouldn't, I mean, you should know what you're going to do. You think it's gonna be 1.5 million? I guess so. I guess so. Yes. Roughly that. Okay. And, and talk to me about churn. Churn is critical in a SaaS company.
What is your churn today? It's very low. I tell you, it's very low. How low? Um, uh, it's, uh, well, in, in the eight years of operations, I've lost three customers up to now. Once a customer get on board, they usually want to develop other applications. It's very difficult that they just leave.
It's also quite hard for them because they build their information system, our platform, and to bring all the stuff elsewhere, it would mean that they would lose the advantage of making evolutive maintenance of the platform in such an easy way. So it's hard for them to give up on that. Very good, Antonio. Good stuff here. Let's wrap up with the famous five. One word answers if you can.
Number one, what's your favorite business book? Actually, it's not a business book. It's more like a marketing book. It's never read alone. That's a good one. Number two, is there a CEO you're following or studying right now? Well, I like a lot Elon Musk. Elon Musk is my myth. Number three, what is your billing tool that you use at the company?
Well, we actually are using a tool that has been developed by ourselves using the platform, by the way. Okay, internal tool. Yeah, using our own platform, we have developed our ERP and we are using that for billing. Number four, how many hours of sleep do you get every night? Sorry, say it again. How many hours of sleep do you get every night? Oh, I do sleep. I actually do sleep. How many hours?
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