SaaS Interviews with CEOs, Startups, Founders
879 SaaS: From $360k Agency to 2 month old, $30k ARR SaaS
20 Dec 2017
Chapter 1: How did Gal and Tomer start their entrepreneurial journey?
Good morning, everybody. I wanted to just quickly remind you, if you love B2B SaaS and you're loving all these CEOs I have on, remember, you can get all of their data in a big, beautiful spreadsheet at getlatka.com. That's G-E-T-L-A-T-K-A dot com. So I hope you're enjoying the month. I love December. I love the holidays. And here is our program for today.
This is the Top Entrepreneurs Podcast, where founders share how they started their companies and got filthy rich or crash and burn. Each episode features revenue numbers, customer counts, and other insider information that creates business news headlines. We went from a couple hundred thousand dollars to 2.7 million. I had no money when I started the company.
It was $160 million, which is the size of many IPOs. We're a bit strapped. We have like 22,000 customers. With over 5 million downloads in a very short amount of time, major outlets like Inc. are calling us the fastest growing business show on iTunes. I'm your host, Nathan Latka, and here's today's episode. Hello, everybody. My guests today are Gal and Tomar.
They're both 28 years old and co-founder of Popton, which is a SaaS company, and ECPM, which is a digital agency. They met in a gifted class in high school and have been best friends since then. They started their business as university students while living together in the same apartment with their girlfriends. They've made it to wife stage, which is obviously a nice plus.
Tomar, Gal, are you ready to take us to the top?
Yeah, let's do it.
All right, good. So obviously business is going well if your high school girlfriends turn into wives, right?
Yeah, yeah, you can say that.
Business among other things. Yeah. Very good. Tell us what Popton does and how you make money. What's your revenue model?
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Chapter 2: What is Popton and how does it generate revenue?
Some people even send an email, like a cold email to us and want to do some jobs for us and we check them out. If they're okay, we'll go for it.
So let me ask you a question.
Chapter 3: What are the main features of Popton's lead capture platform?
For getlatka.com, I have this huge data set. I'm trying to do a really good job editorializing it. I'd love to build it into the SaaS version of Forbes, but it takes a lot of work to listen to the every interview, take the data and write articles about it. but I have a really valuable asset. How would you recommend I scale my content marketing strategy?
I think you should let people add themselves and then you can review it and see if it's legit. and just leave them all and let people use it and put their logos and put all their data. And also they can update it. So if it's like you have, for example, I don't know, like app stuff, it's like from, I don't know, a few months ago. So they'll come back and, and, um, update it like every few months.
If you had like a system that people can log in, insert their own data and update it, you would save a lot of money because at the current situation you have many information that is not dated. It is like from six years, six months ago and No, you need to update from time to time.
Yeah. So we have CEOs coming in. They're able to update it every quarter, which is great. But for writers, look, I'll put a call out right now. Guys, if you want to write for getlatka.com in any way, editorialize the data we have there. Maybe you want to write about Popton and the data that we'll have for them up on the site. You can do that.
Just email me a content idea at nathanlatka at gmail.com and we'll chat. Okay, good. So we've talked content marketing, six grand you paid to freelancers on the agency side. When did you decide that it was time to start focusing on a SaaS business and not just your agency business?
Okay, that's a great question. From day one, when we started, our main goal was to build something big. We didn't want to be in the agency area for a lot of time. We always think... thought about product and I think we started building it like a year ago. And when we had enough revenue to hire a full-time developer, we just did it and started working almost full-time on this.
And our employees working on UCPM and we spend like five or 10% of our time.
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Chapter 4: How many customers does Popton currently have?
You had twins. What the hell are you doing on a podcast episode? Your wife is going to kill me. You know what? She will. What does a baby cost per month?
Uh, okay.
Um, I think, I think, I think that it's about, uh, defensive in the, in the kindergarten or not. Yeah. So it can be like 1000 or less.
Interesting.
Babies are expensive.
So what do you, so, okay. So you guys each have two kids each you're married. Uh, what do you spend per month? Would you say?
I think about two, two and a half thousand dollars.
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Chapter 5: What is the monthly recurring revenue for Popton?
OK, that includes like any rent or mortgage or whatever, food, gas, babies, wife, everything. OK, good. I love this, by the way. Like I love when I get entrepreneurs on who have done a really good job of minimizing their own expenses because they don't they don't have to pay themselves out of the business a lot so they can reinvest more and more and more.
Now, here's a question I've got for you on the agency side. How many customers do you have working with the agency in an average year? 80. Okay, 80s. And I imagine you came up, I mean, did you come up with Popton because a lot of them were asking you to do Popton-related work and you said, let's build a tool for this?
Many of our customers really wanted to put an emphasis on conversion rate, like increase their conversion rate. Then we thought about, okay, let's use a pop-up to do it. We did it manually. We built it for each site. And then we said, okay, if we build it manually and it works, why shouldn't we build a product that can do it as a product, as a service? Then we did it. We did like a lean version.
We tried it. It worked great. And from then, this is how Popton was created.
What's the weirdest thing you've done to acquire your customers so far? You have 72 of them.
Why are you talking about ECPM?
No, no, I'm talking about Popton. Oh, about Popton? Like what'd you do for launch?
We actually, we used our network, like people, the Israeli network, people who we know from here, like Because we have eCPM, which is dedicated to the agency, we know a lot of agencies, so we contacted them and say, okay, you should try Poplin. They did, they loved it, they tried paying us, and this is like one of the basic stuff that we did.
Okay. I mean, you made that sound very easy. It's not that easy. How did you just get them to say yes?
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Chapter 6: How do Gal and Tomer manage their agency and SaaS business?
And then they said, when you have the paid plan, we will be the first one to buy.
How many people, or sorry, how much money last month did you spend on paid marketing, Google ads, Facebook ads, stuff like that?
So we just started actually, maybe like $500, just the first two weeks we're doing.
Just to test?
Yeah. We acquire like three users for like about three bucks per user.
How did you, on what channel? Facebook, Google, something else? And Google AdWords. Google AdWords. Okay, interesting. And what are you, what's it, so what's it cost? You said it's three bucks to get a user. What's it costing you to get a paid customer? What's your CAC?
So it's still early to say that, but I think it could be around $200.
200, which works because if you have 4% monthly churn, that means the average customer is going to stay with you for 25 months at a $30 price point. They're worth 700 or 800 bucks a pop. So you can afford to spend 200, right? Yeah, exactly. Yep. So now you should spend 50 million a month, right?
Yeah, absolutely.
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