SaaS Interviews with CEOs, Startups, Founders
1683 Why He Used Affiliates To Get First $20k in MRR
03 Mar 2020
Chapter 1: What is Maestro and how does it help course creators?
Justin Burns launched Maestro, helping instructors launch their courses faster. 200 customers paying $100 a month, doing about $20,000 per month right now on revenue. 70% of that customer base has come through affiliate webinars where he pays affiliates a 30% kickback in perpetuity. They're doing, again, $20,000 a month right now. Sorry, they've raised $20,000 as well.
So basically bootstrap profiting right now. Call it a couple grand per month. They've got six people in remote locations, about 5% revenue churn per month as he looks to scale the company.
Chapter 2: How did Justin Burns achieve $20,000 MRR with Maestro?
Maybe go raise a couple hundred thousand grand. Hello, everybody. My guest today is Justin Burns. He's a serial entrepreneur who, with just a few hundred bucks and no college degree, got started and launched his second SaaS platform called Maestro, an online course platform that allows for course creators to get their course up fast. Justin, are you ready to take us to the top?
Let's do it.
All right, man. Talk to me about Maestro. What's the company doing and how do you make money?
Yeah, so Maestro is a SaaS company. We make money by charging people per month to create their courses. And pretty much it allows for people to get their courses up. In a matter of minutes, that's our bold claim. Interesting.
Chapter 3: What role do affiliate webinars play in customer acquisition?
And so what do you, on average, what do you charge per month for this?
So on average, our average user is paying around a hundred bucks a month.
Okay. And look, I mean, so I've interviewed a bunch of people kind of in this space and the problem is always churn because it's out of your control. Like if people don't invest in creating content to upload to your platform, you're screwed and eventually they stop paying you. So how do you make sure that doesn't happen?
Yeah. So we actually just experienced like, you know, the churn issue. So what we're doing right now is we're really trying to tackle the biggest issue that we've kind of gotten feedback from our users, which is content, right? Creating content. So what we're doing is we're creating a set of tools right now to make content creation easier.
And then we're also kind of really trying to go the kind of service route a little bit, not really charging for service, but just really helping our students out. I'm actually traveling right now.
speaking because we're really trying to get some feedback on how can we make content creation way easier for our users interesting and when did you launch the company what year we launched it last year so it's like a year old it's great 2017 and how many customers have you scaled to today so we have a few hundred customers right now okay like you're talking like 200 300 yeah 200 around 200 that's great well look 200 times 100 bucks a month it's about what 20 grand a month in revenue
Yeah. Yeah. It's not too bad being a year old.
Yeah. Yeah. So exactly a year ago. So December of, of 2017, you had zero revenue.
Yeah, we had zero.
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Chapter 4: How does Justin manage churn and retain customers?
If anybody has want to go here, Mark, um, walk me through Justin, the, the process for getting these first 200 customers, where'd you find them?
Yeah, so we have a combination of two things. So one is affiliate relationships, which I had before. So we did some affiliate. We've been doing a lot of kind of, you know, kind of toying with the fact of like doing like affiliate marketing, like affiliate webinars that we've acquired. Probably 70% of our customers do that.
And the other 30% is me kind of speaking at various events because I'm also a speaker. So speak about Maestro and users join and sign up.
So walk me through an affiliate webinar. You identify someone like me that might have a big email list of people that you know would be your customers. You reach out and what's the pitch sound like?
Yeah. So it's just kind of, you know, just basically saying, hey, you know, we you know, we cross paths. It usually is kind of referral based. I ask affiliates that I have, you know, relationships in the past. I say, hey, do you know anybody who, you know, you can introduce me to? We get introduced. We hop on the phone. Usually it's just like, hey, I want to see how I can support you.
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Chapter 5: What strategies is Maestro implementing to enhance content creation?
You know, it's usually giving first. Obviously, most people just kind of say, hey, I have this great product. I want you to sign up for it. But usually people are turned off by that. So we kind of go the route of saying, hey, I listen to your show. Like if I was reaching out saying, hey, I'm listening to your show. I love it. Just I love this episode specifically.
Just want to know if you want to just hop on and see if we can create some energy. I can, you know, synergy. I just want to promote you to my audience. And we've been getting some really good. you know, feedback from that and people just, you know, love it. Especially the referral piece is really good and we've been getting really good, you know, pretty good reception.
So fast forward, you and I, you pitched me, we ended up doing a webinar together, call it, you know, two months after you pitched me. We do the webinar, there's, I'm going to make this up, 300 people show up, which means we had about 900 registered. Let's say 220 make it to the end. I put up the offer and let's say, 20 of them buy a $100 a month plan. What's the kickback you pay me?
30% each month.
In perpetuity? Yeah. I'm pitched almost every day by a new CRM founder that wants to come on the show. And usually I say, yes, you guys know on the show, we love covering any B2B SaaS founder, but one story in this space just stands out. And that is a company that was launched in 1996. That means they survived 99. They survived bill one. They survived so many different things and they've done it
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That's Zoho, Z-O-H-O-C-R-M.com forward slash top. The only thing I don't like about that is that basically means no matter what, you are always going to have 70% margins or lower because that's really a cost of goods sold.
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Chapter 6: How did Justin bootstrap his SaaS company and what are his funding plans?
I mean, one thing that I did at my first SaaS company and that I recommend others do in this exact situation is put a clause in the affiliate contract where you essentially have the right to buy out the next 12 months.
of what you would owe the affiliate because what that allows you to do is let's say you go to an investor and they're like while your margins are stuck at 70 because you have this 30 in perpetuity they can essentially buy out that affiliate revenue stream and increase your margins by 30 overnight yeah and we've been actually it's funny because i was actually in a um one of my one of my friends actually sold a company to microsoft uh he's been uh mentoring me and he says who was that
A guy named Mark. Okay. You like marks. I like Mark, like Mark, but he actually sold his company. He actually mentors me in Georgia where I'm based. And so he said, you know, he's like, dude, you got to get rid of that. The recurring, you know, the affiliate part, but we love it. You know, obviously we'd have to go out and pay to acquire customers. So it allowed for us to scale.
And then we're going to go into paid ads very, very soon.
So what's your fully weighted CAC right now? Is it just 30 bucks on the a hundred?
Yeah. I mean, it's just 30 bucks a hundred.
So what's your team tonight? Do you have any sales or marketing?
Yeah. So right now we actually just hired our first salesperson. So we're going to kind of go into the direction of going after different companies because, uh, the differentiation with us is we're kind of going to go in the content direction and we're also going to go in the more engagement. So gamification sort of engagement tools. So with that set, we can go into kind of the enterprise space.
So we're kind of exploring that a little bit right now. So I hire one person. We have six other people on our team.
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Chapter 7: What is the significance of affiliate marketing in Maestro's business model?
So if you do, so if you do raise, what's the perfect amount for you to raise right now?
Again, like that's I think that's the that's the thing where I'm like, I don't know, because it's one of those things where I'm not really looking to raise, meaning it's more like it's more like kind of a discussion. Right. So I would say, you know, who knows, maybe a couple hundred thousand bucks just to kind of and that's for me to kind of scale up.
really not really focus on the product because that's what we focused on perfect right now as a product is more sales and marketing is is kind of the focal point of what we're doing yeah do you um has your mentor talked to you or have you looked or studied a venture debt which is kind of a non-dilutive way to get capital to grow no no we haven't studied that way interesting okay very good let's wrap up man with the famous five number one what's your favorite business book
I would say Breakthrough Advertising by Eugene Schwartz. Marketing book, baby.
That's a good one. Number two, is there a CEO you're following or studying?
Yeah, I love Elon Musk, man. Love how he's innovative and love following him.
Number three, what's your favorite online tool for building a business?
I would have to say, man, CloudApp. I love that thing. I just love, you know, screenshotting everything. It's awesome.
Number four, how many hours of sleep do you get every night?
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