SaaS Interviews with CEOs, Startups, Founders
948 How Barcelona Company Grew Past 600,000 Users With Email Open Tracking
27 Feb 2018
Chapter 1: What is the main topic discussed in this episode?
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 Eduardo Manchon.
He is the founder and CPU of a company called MailTrack.io. Previously, he was the founder of Panoramio, which was acquired by Google, and a partner at another firm that was acquired by eBay. His background is in psychology and UX. Eduardo, are you ready to take us to the top? Yeah, I am. Okay, very cool. So kick us off. What does MailTrack do and what's your revenue model? How do you make money?
Yeah, MailTrack, it's basically the double check for Gmail. So it tells you when your email has been read using this double check. One check not read, two checks, two green checks read. And then we are a freemium service that adds a signature to every email you send. A signature that says send with MailTrack. And if you want to remove that signature, then you pay.
And then that's our business model nowadays. And then give us a sense of kind of where you're at today in terms of customers and revenue. Yeah, we have like 22,000 customers and we have a 1.1 million euros, uh, annual recurrent revenue. Got it. So you've passed what about 90 K per month or 90,000 euros per month? Exactly. 90,000. That's great. And that's a lot of customers.
So you're very much kind of a high volume, low touch kind of sale. Walk me through how one of the, like, how are you finding these customers? Well, that's a good question because we don't spend money in growth. We're an acquisition, so we checked AdWords, but there is no volume. Basically, it comes from virality, from word of mouth, also the virality in our signature. We have 2 million signups.
That means currently like 600,000 active monthly users. And then they send the signature. Most of them, they keep the signature. They don't remove it. They don't pay for the service. And then this brings us like 15% of the signups, they come from the signature. And then most of the traffic comes from the Chrome store. The Chrome store is a place that brings you a lot of exposure.
It seems that not very many people take it seriously. But in our case, for example, every day we have 700,000 impressions of MailTrack inside the Chrome store. That's a lot. But not even Google seems to take it seriously. The dashboard sucks and there's not very much competition there.
So on that same dashboard that you're referencing, the little chart that it's like a little red and blue line, how many new installs are you getting per day? Yeah, around 60,000. 60,000 new installs? Wait, sorry, per month. So daily from the Chrome store, we have like 2,500 around. And then from our website, we have 1,500 more. So it's like around 4,000 installs per day.
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Chapter 2: What is MailTrack and how does it generate revenue?
Suddenly one day we were 1 million, well, 1 million monthly users. And then it went down to our current number. So the Chromastore numbers, we prefer to trust better our own numbers. That's smart. Walk me through how you're a psychology guy. Your guys' homepage has been the same for a while. And I think that's probably very intentional because it's so simple.
Walk me through how you designed your homepage and how effective it is for you in terms of conversions. Well, we offer a pretty simple service. And this is what people like best from MailTrack. It's just a double check. And then we don't want to explain very much about the service because there is not very much to explain about it. We want you to start it and to experience it as fast as possible.
Then once you see what this is, there is a small video that shows how the double-check displays inside your Gmail. You are familiar from that from Messenger services. Then you style it and then you send your first e-mail. Then the wow effect we get is when you get the e-mail confirmation that that e-mail has been opened.
Then you come back to the interface and you see that the green double-check changes. Also have desktop notifications from the browser that they inform you when email has been read. So that will suck people back into your website. Exactly. Yeah. That was one of my questions for you. My research team in preparing for this interview noticed your website.
I mean, you guys have an incredible amount of traffic to your website every month. And one of my questions, too, is how are you getting that traffic? It sounds like a lot of that is from current users who you pull back to your website using the pop-ups and the desktop notifications. Yeah.
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Chapter 3: How many customers and what revenue does MailTrack currently have?
Well, basically today, once we use the Mail track, you are inside . And then, typically, Gmail is used six hours per day or eight hours per day during the journey. So at any moment, we can launch a pop-up or we can do things. We do very little, actually. But there is a way to drive traffic to the site from that.
How do you deal with folks that say, hey, I really want to try MailTrack, but I can't have this branding across the bottom and I don't want to pay? Yeah, you can remove the signature every time, manually, from every email you send. So you still have that chance. If you don't want to pay, you just remove it. But we have a nice funnel because we add our own button to remove the signature.
So after a certain amount of time you have removed the signature, you will display a pop-up window that says, if you want to remove it forever, just pay. We know that a lot of users, they keep removing the signature manually for months until they decide the service is worth to pay.
Yeah, they do it over and over and over and then they finally go, oh my gosh, just not having to click this every time is worth five bucks, right? Yeah. Makes sense. What about, so companies like yours where the average revenue per user per month is around that $5 mark or it's really low, churn is typically an issue. What do you guys see in terms of logo churn and revenue churn?
Well, for the moment, the challenge is not that high. Because we have a yearly plan. So we know that with this product, we cannot offer a monthly plan because then the challenge will be very, very high. Because the product doesn't deliver value until you use it for several months. But having the yearly plan, we reduced the churn very much. So the churn is currently only like 2.43%. Per month?
Yeah, per month. And that's logo churn or revenue churn? Or they're the same?
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Chapter 4: What strategies does MailTrack use to acquire customers?
It's revenue churn. Got it. And why do you say your tool can't deliver value for months if the value is they send an email and they get a notification when it gets opened? Can't that happen fairly quickly? No. Yeah, that's right. But there are several ways to use Mail Track. So there is also important when people don't open your emails,
Then we send you a reminder that tells you the email hasn't been opened in 24 hours. There is an issue with that. So that doesn't happen that often. So MailTrack takes time until you add it to your habits and you think it's worth to remove the signature. So we know that it takes time until you use it over and over that you perceive that MailTrack is something worthy to pay.
Now let's get kind of more of the backstory here. So take us back to launch date. When did you guys launch this company? Yeah, in 2013. Okay, 2013. And now today, how many folks are you at full-time? We have 12 people full-time. 12 people. And are you guys all based in Barcelona? Yeah, we are all based here. Okay, so Barcelona. And have you bootstrapped the company or have you raised?
And if so, how much? Yeah, we have raised like ā¬600,000. and then we'll have some subsidies from the government that make like 300,000 more. Okay, got it. So you have 300,000, and is that convertible debt or equity? Yeah, it's debt. Okay, so convertible debt, and then another 300,000, which is basically a grant from the government, and that's basically free money, right? Yeah, basically.
So what's the, and then help us understand kind of from a growth perspective how you guys have done. So currently you're at 1.1 million in euros in ARR. What were you at at the end of December of 2016? We were like basically half, like 450 something. Okay, so you're about, I still call it 45,000 euros per month, something like that. Mm-hmm, exactly.
And can you give, do you remember back one year before that in December 2015? Yeah, very little, only like 20,000, something like that. 20,000 yearly? Yeah, 20,000.
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Chapter 5: How does MailTrack leverage the Chrome Store for growth?
And then we started in the middle of the year. So that year, before we started as a free service, we didn't even have a revenue model. We didn't know what was going to happen. So that early, we didn't monetize at all.
Many of you know I am buying companies that I really, really like, and there's no quicker way for me to get to the bottom of what is happening on that website than using this tool called NathanLaka.com forward slash hotjar, H-O-T-J-A-R. It basically will give me a recording.
OK, when anybody lands on the website, I'll give me a recording of where the viewer is scrolling and obviously does the basic stuff like heat maps, too. But I learned so much about where the users are scrolling and clicking on my site using that tool. It helps me increase conversion rates, make more money and grow those businesses faster. And we'll have to see what happens with those businesses.
But I'm buying them. I'm buying them very quick. And I'm using nathanlatka.com forward slash hotjar for all of my website analytics. You can too. I work with them. It's totally free. You can go to nathanlatka.com forward slash hotjar. No credit card required. Again, use it as much as you want. nathanlatka.com forward slash hotjar. I'll see you there.
So December 2015, about 20,000 per month in euros. Fast forward a year, you're at 45,000. Fast forward another year to today, you're at about 91,000. That's great growth. But Mike, if you launched in 2013, there were two years there where you guys were free. How were you paying for food at night? How were you supporting yourself? Well, the money we raised was...
And also I think that the salaries in Spain, they are not that high in the US. So the team also was much smaller. They were at the very beginning, like four or five people only. Okay. So it wasn't all for us. So there's three co-founders? Yes, we have three co-founders. Nacho GonzƔlez, that is a pretty famous co-founder here in Barcelona. He had three exits, including one to TripAdvisor.
and the CDO that also has experience abroad. And how did you guys come up with, you know, how you're going to split equity? Did you just do one third, one third, one third? Or how did you have that conversation? Well, it wasn't like that from the very beginning. We have other co-founders in the very first time, in the very beginning. I was an advisor only.
And then they, I think they didn't spend, Nacho did some money. And then the other guys, they were like, just like had a minority. And then they have to delete it when they get the money. So I came much later. So I don't know very much of all the details. I see. Okay. So you have, can we say like less than 10% because you were an advisor and then joined later?
Yeah, now I have like, yeah, 10% actually. Okay, got it. And Nacho, since he put in most of the money at the beginning, he's the majority holder. Does he have more than 50%? No. Okay. But he owns the most of any individual? Yes. Got it. Got it. Makes sense. Walk me through, you said 15% of your new customers every month come from the, you know, sent with MailTrack across the bottom.
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