SaaS Interviews with CEOs, Startups, Founders
1686 How He Sold His First $1m ARR Company
06 Mar 2020
Chapter 1: What inspired Sean to drop out of college and start his first company?
Sold his first company, now building high level to help small businesses with reviews, text messaging, and even appointment scheduling. They now have about 10 agencies using them, paying 300 bucks a month. Those agencies sell through to SMBs, doing about three grand per month right now.
Got his first couple of customers by integrating with a software marketplace, Dr. Crono, which is a medical HR kind of developer marketplace. He's bootstrapped the company off money he made from a, call it a 400, $500,000 sale of invoice share. But team of two right now, building the company in remote locations, zero churn so far. Hello, everybody. My guest today is Sean Clark.
He dropped out of college to start the world's largest answering service and then left after 12 years to start an accounting company, sold that and is now helping marketing agencies close more leads to customers through automation. He lives in Eugene, Oregon, married with a six-year-old son. Sean, are you ready to take us to the top? Absolutely. Let's do it. Awesome. All right.
So the company you sold was, I believe, Invoice Sherpa, correct?
That's correct.
So is that like a FreshBooks competitor?
Yeah.
No, it was accounts receivable automation, which sounds really boring, but basically it just helped small and medium businesses collect money that was owed to them. And by automating all kinds of outreach to the customers and just basically bothering people until they paid their bills.
And why'd you sell it?
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Chapter 2: How did Sean grow his first company to a thousand customers?
So this is something we're going to be doing constantly. And we don't sell it on a per client basis. We sell it on a per agency basis so they can continue to use it so long as they're operating and generating as an agency.
So what is churn, like last 12 months revenue churn? Zero. Zero, you haven't had any downgrades or no cancellations?
No, not at all. Although we're still really small, and we're still growing. So I anticipate that that will at some point happen. But for the moment, we're delivering a lot of value.
When did you launch the company?
About six months ago.
Okay, so good. Very new 2018. How many customers today?
Right now we're doing we only only have to 10 agencies that we're working with 10 agencies.
Okay. And how'd you sign up these first 10? Where'd you find them?
all just bootstrapping. And we integrated with a couple of software marketplaces as well. And they sort of just found us. And then we started realizing, oh, wait a second, maybe this is a good market. And we started just outreaching to them directly. And we just found that there was a really natural fit from what we were selling to what they were needing. It was very surprising.
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Chapter 3: What motivated Sean to sell Invoice Sherpa?
I've got a software developer partner who's living in Qatar right now. And then we've got a couple of contractors that are doing things like design and front end work and so forth.
OK, so two remote and then and then everyone else's contract. You got it. That's awesome. OK, very good. And then churn. It's too easy to talk about those cohorts. I mean, how do you how do you go from 10 customers to 100? What do you think?
Chapter 4: What is Sean's new company, High Level, focused on?
Where do you think they're going to come from?
I really think it's going to be through the affiliate model. So somebody that I really, um, admire from a, so a couple of people you've had on, um, uh, Brendan King from Vendasta and also, um, I'm going to, I don't know, I can't remember his name, the gentleman from ClickFunnels.
Yeah.
Um, Thank you. Very similar models, very similar customer base. So we're going to work with those agencies. We help these lead generation agencies actually raise the retention because we're able to help them actually close a lot of the leads that they're bringing their customers.
Whereas right now, a lot of those customers, those leads just kind of die on the vine because the customers don't do a good job actually following up on the leads.
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Chapter 5: How does High Level help marketing agencies increase customer acquisition?
And we automate that whole process. And so as a result, we're a huge value add to those agencies.
Yeah, that's interesting. Good. And so these agencies, I mean, how many customers are they typically using your software on?
Generally, it's anywhere from 10 to 20. I mean, every agency is different sizes, right? And we're early on, so we're starting small. And so the agencies we work with, again, are going to have a stable of 20 customers.
But we generally are, for the agencies that we target, we're really targeting people who are not necessarily in the business of creating a beautiful website or a beautiful Facebook page or whatever. They're about driving you actual leads. So we have really good coverage in those agencies. And we generally can take about 80% to 90% of their customer base and do something pretty awesome for them.
Interesting. You had a lot of options, kind of what you could do after you sold Envoy Sherpa. Why decided to get into this space?
You know, I worked with a lot of small businesses every day and I heard a lot of different pain points. And one of the things was always about marketing and sales. And I naively thought I could go into the marketing space and sell direct to customers and customers. I found that to be really tough sledding person to my previous business.
Um, and so when I, you know, I, I just love the idea of helping small businesses grow. And if I can do that in any kind of way, that's what I want to do.
Yeah. So you've got so high level, it looks like you do like a lot of things like reviews, text message, customers, appointment scheduling as a reputation management product.
And it's really grown into more of like this. Yeah. So we've got the review side of the house, the booking, the booking widget sort of side of the house.
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Chapter 6: What strategies did Sean use to acquire his first 10 customers?
Um, yeah, probably, uh, Brendan King from Bendasta.
Number three, what's your favorite online tool for building the company?
Um, I would say besides my own tool.
Yeah. Besides your own.
Yeah, definitely. Probably like Slack is great.
Okay. And number four, how many hours of sleep do you get every night?
Uh, six and a half.
Good. And what's your situation? Oh, I know you have a wife. So married, how many kids, any kids?
Married one child's boy, six years old.
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