SaaS Interviews with CEOs, Startups, Founders
880 SaaS: Why Is This Engineer Competing in Highly Competitive Space?
21 Dec 2017
Chapter 1: What is the main topic discussed in this episode?
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 of 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, everyone. My guest today is Natwar Maheshwari.
He is the CEO and co-founder of a company called Around.io, building social media automation and more for small businesses around the world. He's a drac of all trades, a master of some, a lean startup enthusiast, and has strong opinions weekly held. Natwar, are you ready to take us to the top? Yes, I'm all ready to take you to the top. Good. Tell us what Around.io does and how do you make money?
Okay, so Around.io is a social media automation platform for e-commerce sellers. E-commerce meaning you could be on a platform like Etsy or SoRenV or you could have your own store on Shopify or WooCommerce or anything like that. It's a plugin which basically helps you automate all of your social media postings like for five minutes a week. Okay. And this is obviously a very competitive space.
So you are kind of differentiating in that you're only focused on e-commerce businesses. That is absolutely correct. It is super, super competitive space. And the best part is... Name a few of your competitors. So if you go like all big, like who are not in the niche, Buffer and Hootsuite and Sprout Social and people like that, who are doing tens of millions of dollars in ARR.
Buffer just crossed 15 mil recently. So of course, it's a very competitive space, but my research says there are more than 500 tools in the world right now, who are doing something in social media automation. So it's definitely very, very competitive space, yeah. And tell me, give me a sense of where you're at. So how many customers are you serving today?
So we are a little more than 600 customers right now, a little less than 100,000 annual recurring revenue. So that's not like, the numbers are very small as compared to a lot of other SaaS companies that you look at. And I've also heard your podcast a lot. And so we are little less than 100,000 ARR. We are growing very slowly.
We are a bootstrap company, very small team, trying to kind of, you know, expand as much as we can while we're growing. So just to be clear, the average customer is paying you about $167 a year times $600 is where you get $100,000 in ARR about? Yep, yep. So recently we just updated our pricing. Now our pool just grew up to $22. It was at like around 13, 14, eight months ago, but now it's at 22.
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Chapter 2: What is Around.io and how does it generate revenue?
So from day one, it has been a paid tool. That was one of the learnings I had from my earlier work. And who's we? We as in it was so I'm a single co-founder, actually. You said co-founder, but I'm a single founder, actually. And from day one, I've had one more person within my team. He's a he's a core team member, but he's not a co-founder. And we are right now like six people. And that's it.
That includes me as well. We are 100 percent virtual team. What do you pay yourself? What do you pay yourself per month? I do not pay myself right now. I was paying myself last year, and then I realized if I want to grow this, I really have to take myself out. And I was thinking we'll actually talk about this a little bit today because I've heard your podcast before.
We really talk about the fact that what is the emotional toll on the founder when you're bootstrapped and when you're not paying yourself and stuff like that. So not a lot of people talk about it, and that's okay. I understand that. So how are you eating dinner tonight? Who's paying?
So, so, uh, my wife works, you know, and she's absolutely happy to kind of, uh, uh, take care of the play, like take care of the basic expenses that we have. Of course, we cannot do a lot of things that we would want to at this age, but, uh, but that's a compromise.
Chapter 3: What challenges does Around.io face in a competitive market?
Another thing that we did was, um, um, I had a job before this. Uh, so I saved up enough. How old are you now? I am 31. And what was your job before? What did it pay? Uh, I, it was like a good hundred K salary. Um, I was here in Gaithersburg, um, And I was an automation engineer for a very good biopharma company, great people, great team. And, you know, it was really a good place to work.
I was there for a good four years, three and a half, four years. So I saved up enough money at that time as well. To kind of sustain myself. So that was like my roadmap. I planned it for two and a half years before I quit my job. So you kind of knew that even if this new company didn't make any money, you had two or three years worth of savings in the bank. Yes. And, you know, yeah.
So so I kind of cut down everything to very, very core of what what you spend. And you have to be kind of comfortable with that. And we did that and it kind of worked out well. Yeah, you guys are in there because I grew up in Loudoun County, which I just saw a report. It's the wealthiest county in the nation. You actually really because I believe government going.
I mean, if you look around the Beltway, seven of the top 10 richest counties in the country are around D.C. Right. So Fairfax, where you are, is one of them. So I imagine your expenses like it's not easy to keep your expenses low in where you're living. So, so I'll tell you this.
Uh, I, I lived in, so, uh, I was in Githersburg working there and then I moved back to India, uh, for, uh, for a good four years, actually. So I spent, so, so, you know, living costs in India is much different than living costs in the US. Right. So, uh, then my wife again, got a job here. Uh, her company wanted to move her here. So what's her title? She is a human resource manager, uh, with BWC.
So, um, that's what she does. Uh, But the point is we actually lived separately. I was in Bangalore for another year and she was here. She was kind of trying to set things up here.
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Chapter 4: How many customers does Around.io currently serve?
And so we kind of, you know, adjusted however we could. I recently moved back full time here in March, actually. And before that, I was just traveling back and forth once or twice a year. And that was, you know, feasible. That was possible at the time, yeah. Guys, big news. Last month was a huge month for the company I recently acquired, which was www.thetopinbox.com.
I liked the company so much when I met the person who created it. It lets you send emails later on Gmail, set up reminders like snooze almost to keep your inbox clean. Do things like send auto follow-ups and do open tracking so you know when your emails get opened. It's great if you're in sales or CEO or trying to be more productive.
So listen, I bought the whole company on the spot and I wanna tell you how I did it. I've showed the deal, by the way, to big, smart people, private equity firms, VCs, and they're dumbfounded. They go, Nathan, how did you do this? We've never seen a deal like this. How did you do this? So I did an unbelievable deal and I wanna show you the income report.
So for me to send you the income report, go to www.thetopinbox.com, click the red button that says, install this on Gmail. And when you do that, my email will appear. It'll appear in a little Gmail pop-up window. Send me an email and I'll reply immediately with the income report. And you can see how I'm buying and growing small B2B SaaS companies. That's www.thetopinbox.com.
Totally free to try and use. www.thetopinbox.com. So let's kind of understand more of the growth story here. So take me back to December 2016. How much revenue in MRR or AR were you doing at that point? We were doing like 5,000, 5,200 MRR at the time. We are doing a little more than 7,500 right now.
I mean, of course, it's not a great, it's not great growth overall, but we're trying to understand what is making people take in. And right now the goal is to make sure that we get the customers who actually stick around. That's a very, very important thing for us. Me and one of my team members, two of us basically look at this very acutely. And
Getting the right kind of customers who actually stick around is really important for us. So that's what we are focused on. Are you bootstrapped or have you raised capital? 100% bootstrapped right now. Yeah. Yeah. So like, I mean, look, my thing about this space is like, I just feel like it's being commoditized. Like, I don't think it's about you finding the right customers.
It's just other people are offering the same thing at a lower price point. So like, how do you win? You basically win. So I was talking about this with one of my other founder friends as well. I think people will always undercut you on price. That's just always going to happen. So you have to kind of have product differentiator as well as something else that people love about you.
So for us, it's customer service. I still handle like 95% of the customer service right now because it's very, very, very important for us to make sure our customers...
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Chapter 5: What is the current churn rate for Around.io?
Understand that we take this very, very, very seriously. Yeah, but everybody does. Not really, actually. Well, you have competitors that do. Yeah, but at the same time, you have to understand that the pie is not that small, that only one person or one company can eat it. If you do this right, if you do this for enough time and if you build enough product.
you can actually stick around and get more piece of the pie. Buffer is great at customer service. We all know that. They've done a tremendous job at this. But at the same time, there are a lot of other competitors who really don't do this right. And a lot of people come to you and say, hey, I messaged someone and they don't even bother responding for five days.
And for us, that's very, very important. Even if something is broken, if something has a bug, just coming out and saying, hey, we are working on this helps a lot. At least for SMB customers, that's what I've seen. Yeah, I mean, again, that'll help and it'll buy you a little bit more time.
But it still is a really like what I'm trying to get at is with someone with your background, why choose to compete in this space? Yeah, so I'll tell you, there is no logical reasoning to why I started doing this other than the fact that I was in vicinity of a, I was helping out another startup at the moment who was in the similar space.
And I saw an opportunity and then when I built an MVP for it, it worked, like people started paying me and then that's how it kind of took off. Yeah, we'll see what happens. But I mean, you've got folks like Later is in the fold. Promo Republic is raising capital right now, doing very well. Obviously, then you have the big guys.
Then you have the smaller ones like Edgar, but not really that small anymore.
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Chapter 6: How did Around.io improve customer retention?
They're $400,000, $500,000 a month in revenue. I mean, it's just really competitive. So interesting. Cool. So we'll see what happens. So bootstraps so far, would you consider raising capital? And if so, how would you think about doing that? I would not consider it at the moment because we are at a place that it's going to be very tough.
If I go to an investor right now and say I've been alive for more than three and a half years and now I would raise funds, they're going to ask very serious questions and they're going to have very serious concerns. I understand that part. So our goal is to get to a certain place by end of this year if we can touch 200K in ARR. I think we'll be able to be in a decent place that we can...
put more money into marketing. We have not actually invested a lot in marketing because of course we don't have a lot of money. So, uh, so, uh, getting to that place where we can invest at least 10 K per month in marketing is, is the place I believe that we can kind of spend last month in paid, paid marketing. I experimented with some video ads on Facebook. I spent like 300, 400 bucks.
It was just an experiment to understand how it's working. Did it work? It worked for Shopify, yes. For getting Shopify installs, it works, yes. But that doesn't make you money. No, it does. So we have an app on Shopify platform. So it's like $30 a month. So when people use our app, that's what they pay us. I mean, of course, Shopify keeps that cut of 20%, but we get the rest. Got it.
I see what you're saying. You're getting downloads through the Shopify ecosystem and you're tied together.
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Chapter 7: What were the initial expectations set for Around.io customers?
Got it. Okay, good. Interesting. Let's, and again, your whole team, is it all, are you guys all based in Gaithersburg up there in Maryland? No, no. So 100% virtual, meaning a lot of them are in India. Actually, all of them are in India at the moment because I was there.
So that's another thing that changes a lot of things because I was there, we had an office, a small office, and now it's not there. So People are still getting used to, you know, 100% virtual thing and stuff like that. How are you getting customers right now? Most of our customers are coming from the fact that other customers are recommending.
So that's one of the very, very important channels that has worked for us. Second is, you know, we have done a pretty decent job on getting on decent blogs and ranking. So for very, very large scale, long tail keywords, we rank well. And that's where we get a lot of customers. Like give me an example keyword. So go to, let's say, for example, Instagram shout outs for e-commerce, right?
If you do that, we will rank on the top. And then that's how I have to search the whole thing. Instagram shout outs for e-commerce. Yeah. So Instagram shout outs, even for Instagram shout outs will be in top five. Yeah, I see. And your thing is Instagram shout outs, 50 Instagram accounts to shout out your store. Yeah. So what that does is, so for our blog has been pretty decent.
I won't say it has been as good as we would have wanted as far as customer acquisition channel is concerned, but that has done pretty decent for us. And it's a constant investment. I'm sure you understand that. So we are still struggling. We're still trying to figure out how to kind of do this better and, you know, experimenting every day. Makes good sense.
Let's wrap up Anadwar with the famous five. Number one, what's your favorite business book? Um, I think it's about hard things. Number two, is there a CEO that you're following or studying? Uh, I mean, Elon Musk, of course. Uh, but, but other than that, Gary Vaynerchuk, um, I really like him. I like his books and stuff. So yeah.
Number three, besides your own, is there a favorite online tool you have? Oh, I love MailChimp. I love Google drive. Um, Other than that, yeah, I mean, Skype is great, but that's it. Number four, how many hours of sleep do you get every night? I am trying to improve that and track it. And so I'm doing an average of six, six and a half right now. So it's pretty good. And what's your situation?
We know you're married. Do you have any kids? No, no kids. And how old are you? I'm 31. 31. All right. Last last question. Take us back 11 years. What was your 20 year old self knew?
like save more man i like uh when i started making money i did not save a lot of it um for for quite some time um so i started working very early on but i never like really saved money i was good spenders there you guys have it from noir save more money earlier it gets you more flexibility he's got that flexibility finally in 2014 when he jumped out on his own after saving a bunch founded his company called around.io helps e-commerce brands automate and save time with their social media marketing currently serving 600 customers each paying about four
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