SaaS Interviews with CEOs, Startups, Founders
1749 How He Hit $9m Revenues Paying Resellers 24% Kickbacks
08 May 2020
Chapter 1: What is the main topic discussed in this episode?
Britech Global, again, making investment and wealth management decisions easier. They're now doing about $9 million a year in terms of run rate. They have 5% net revenue, or sorry, gross revenue churn annually with 25, sorry, 125% net revenue retention per About a seven-month payback period, but unique model here.
Chapter 2: How does Britech Global achieve $9 million in annual revenue?
No quota-carrying reps on their team, mostly engineers, 15, 16 engineers.
They leverage a value-added reseller model where they incentivize resellers under their brand to sell their product, and then they pay a kickback of about 24% to that value-added reseller as they look to scale their profitable, taking about 20% EBITDA margins to the bottom line every single month in terms of cash flow, $4 million raised annually. Hello, everyone. My guest today is Yuri Ferber.
He is a successful entrepreneur with a 20 plus year track record. He previously was CEO and founder of YMF, a leading financial software company with 300 employees that was later sold to TOTVS. Now building a company called Britech, URL britech.global, making digital simpler for folks. Yuri, you ready to take us to the top?
Let's go, Nathan, and good to talk with you again.
Yeah, I'm glad you're able to make time to jump back on. For those that missed the first episode, tell us quick, what does the company do?
We are in the investment management space. So we are a SaaS company. We serve the investment management ecosystem and they serve the investors.
So tell me the story of how a customer that's paying you right now, how are they paying you and how do they use you?
Yes, our ACV is still basically the same. We are talking about $3,000 a month.
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Chapter 3: What unique model does Britech use to incentivize resellers?
So our ACV is very stable.
And how many customers are you serving now?
We have like 250 customers.
That's up from 150, which is great, from about what that would have been almost a year and a half ago. So nice growth. Where does most of that growth come from? Where are you finding customers?
We have some news from that time. At that time, we were having customers in Brazil, Mexico, and Chile. Now we have customers in eight countries. Last year, we started our expansion to Europe and the US markets.
Now, when you came on back in 2018, you said that in Q1 of 2019, you were going to close, I think you told me, a $6 million raise at a 6x pre-money valuation. Did that deal happen?
No, because we stopped that raising process. What happened is that we changed our expansion model. We created what we call a distribution franchise model. So basically, we now have like five franchisees around the world, and they are... allowing us to expand globally without a lot of money from our side. So at that time, we were raising money to grow the sales and marketing team.
And now that growth is coming from the channels, from the franchisees that we are attracting around the world.
And Yuri, with this model, which is new since the last time we spoke, what have you been able to grow revenue to today?
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Chapter 4: How has Britech expanded its customer base internationally?
We don't like upfront payments. So we really... Try to make monthly payments. Okay.
And why is that? Most people like upfront payments because it pulls cash forward.
Because we are already profitable, so we don't need upfront payments. And that's it. How profitable are you? Like 20% EBITDA margin.
Okay, got it. So on $750,000 per month, you're talking about $15,000 a month. Sorry, $150,000 a month added to your bank account every month. What do you do with that money? Do you just let it sit there and pile up or what?
So we are using that money to expand, to attract more channels. So of course, this is a cost for us to expand. But after we find a new channel in a specific area, we have the cost to find these guys. We have the cost to train them. We have the cost to onboard these guys. So we are using part of the cash generation to expand in more channels.
Very good. All right, Yuri, let's wrap up here with the famous five. Number one, what's your favorite business book?
Nowadays, I have another famous business book, which is a book from Simon Sinek, which is The Infinite Game.
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Chapter 5: What changes were made to Britech's expansion model?
Number two, is there a CEO you're following or studying?
I really think that the CEO from Microsoft, this guy is really doing a great job.
Number three, what's your favorite online tool for building your company?
We use a group of technology. And so we use HubSpot. We use Zendesk. We also are using nowadays Churn Zero for customer success management. And Microsoft Planner, Microsoft Teams. This is the most important tools we are using in our day-to-day operations.
Number four, how many hours of sleep are you getting every night?
Six, seven hours per night.
And what's your situation? Married, single kids? Married, three kids. Wow, how old are you? 56. 56. And last question, what do you wish your 20-year-old self knew?
Again, I would love to know more about SAS 20 years ago.
Guys, there you have it. Britech Global, again, making investment and wealth management decisions easier. They're now doing about $9 million a year in terms of run rate. They have 5% net revenue, or sorry, gross revenue churn annually with 25, sorry, 125% net revenue retention, about a seven-month payback period, but unique
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