SaaS Interviews with CEOs, Startups, Founders
EP 583: Socedo Does $1.5M+ In 2016, $200K MRR Now Helping 200 Customers Close More Leads with CEO Aseem Badshah
27 Feb 2017
Chapter 1: What is Socedo and how does it help B2B marketers?
This is The Top, where I interview entrepreneurs who are number one or number two in their industry in terms of revenue or customer base. You'll learn how much revenue they're making, what their marketing funnel looks like, and how many customers they have. I'm now at $20,000 per top. Five and six million. He is hell-bent on global domination. We just broke our 100,000-unit soul mark.
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Chapter 2: What behavioral data does Socedo provide for lead generation?
Nathan Latke here. This is episode 583. And coming up tomorrow morning, you're going to hear a YC founder, Y Combinator founder, the founder of FlightFox, say the following. Nathan, we talk about when to quit all the time. Well, that's strange because they did $700,000 in revenue last year. So who is Lauren Sullivan, CEO of FlightFox, talking about? Tune in tomorrow to find out.
Good morning, folks. Nathan Latke here. Our guest today is Asim Bajan.
Chapter 3: How does Socedo's business model generate revenue?
He is the founder and CEO of a company called Societo. Now, before that, he had built his own marketing agency, full-service marketing agency called Uptown Treehouse. They help brands meet their goals by leveraging social media and digital channels to reach current and potential customers. He's now upping that with his new company Societo. We're going to jump into it today.
Asim, are you ready to take us to the top? I am. Thank you for having me. Thanks for coming on. So, okay.
Chapter 4: What challenges did Socedo face in its early years?
Tell us what Socido does and what's your business model. How do you make money?
Absolutely. Absolutely. So here's the thing that we noticed in the agency is that there is so much data out there on prospects for B2B marketers and truly around activities, right? What's the behavioral data that, that prospects target audiences are taking out there on the social web and Our goal is to bring that in and actually make use of that in B2B marketing to acquire more customers.
And so there's really kind of two ways that we do that. One is lead generation. It's, you know, hey, who out there in the world is talking about your topic, doing research, going to the events that you as a B2B marketer would be sponsoring?
Chapter 5: How has Socedo's revenue growth evolved over the years?
And we give you a way to actually pull those people into your marketing automation to reach out to them, to nurture them. But then we also do that on your existing database. If you're a B2B marketer and you've got 100,000 people in your CRM, in your marketing automation, it's probably a good chance that a good portion of them are maybe not engaged anymore. They're not active.
Well, we provide the behavioral data on top of those contacts so you can reactivate them. You can get them in the right campaigns, get the right messaging to them, and get them to your sales team at the right time. And we basically make money off of a software license.
So we charge based on data consumption on volumes, and our clients basically sign up for six-month to year-long licenses to really power their demand generation.
And what is the, let's just talk about in terms of averages so we don't have to get into individual customers. On average, what is the company paying you per year?
Chapter 6: What strategies does Socedo use to retain customers?
Average is around $12,000 to $15,000 a year.
Okay, so call it like $1,000-ish monthly ARPU, something like that. That's correct. And then take us back. When did you start this thing?
So we started back in 2013, it was a bit of an evolution from the agency. So we actually started this as kind of an R and D research project and the agency, you know, cause essentially what we noticed is that when it came to social media marketing, everything was really set up for B2C marketers, right? It was all set up around brand awareness and broadcast.
I'm going to build a really big audience on Twitter or Facebook and then push my messages out.
Chapter 7: What data sources does Socedo rely on for accuracy?
And it looks a lot like traditional marketing, right? What you would do with a TV ad or a billboard, which is great for B2C marketers who are trying to build a brand, drive community engagement, and really do that with a large audience.
For B2B marketers where you're very focused, you're talking about a long sales cycle, you're looking to nurture specific people, you know, social media marketing in the traditional sense wasn't really set up for them. And so we kind of wondered why, right? Like, you know, social media is essentially one big CRM system, right? why is there not a tool set to actually leverage it in that way?
And that's what we set out to do. And so in, at the end of 2012, we started building out as an R and D project in 2013, we spun out. So Cito, we joined tech stars up here in Seattle and I've kind of been off to the races since then.
And where are you today, January, 2017, how much, or sorry, how many customers are actively paying you per month?
Chapter 8: What advice does the CEO give to aspiring entrepreneurs?
We've got about 200 paying customers today.
Okay. And then in terms of capital raise, you mentioned tech stars, how much total capital have you raised?
So we've raised about $1.5 million to date and have kind of been extremely capital efficient, right? So 200 customers, we grew revenue about 3x in 2016 and are growing quickly into 2017 as well.
Yeah, is it fair to say, can I take 200 customers times an average of $1,000 per month and assume you're doing somewhere around $200,000 per month, but you're pulling a lot of that forward with 6- and 12-month contracts?
Exactly, exactly. You know, we've got some big customers as well, right? And some customers are paying all the way up to half a million, you know, a year and then smaller customers as well. But our kind of, you know, real march has been upstream, right?
We kind of started a little bit more in the small business segment and have really kind of been working with much larger and larger clients as we get connected into their CRM and marketing automation systems to really kind of provide customers that core advantage across their entire demand generation platform.
And what is, you mentioned you grew 3X in terms of revenue in 2016. What was total revenue in 2016?
So, you know, we don't kind of publicly give those numbers, but you're kind of calculating it correctly, you know, based on, you know, kind of average number of customers in ARPU. And so, you know, kind of quickly growing into a, you know, a pretty mature company over here. We've got about 25 people in Seattle at this point.
Fair to say, I'm just literally taking MRR and kind of guessing last year. Fair to say you did somewhere between 1.5 and 2.5 million? Right. Yeah. And then what's your goal for 2017? You want a 3X, 1X, 2X? What do you think you'll do?
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