SaaS Interviews with CEOs, Startups, Founders
Jiga3d Connects Engineers to Manufacturers, 30 Transactions at $2k each so Far
09 Sep 2020
Chapter 1: What is the main topic discussed in this episode?
This is the marketplace tool, so we have to drive new revenue each time. But five out of ten customers are returning. So in average, we have about every customer makes about two transactions a month. You are listening to Conversations with Nathan Latka. Now, if you're hearing this, it means you're not currently on our subscriber feed. To subscribe, go to getlatka.com.
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Or bootstrap founders like Vivek of QuestionPro. When I started the company, it was not cool to raise. Or Looker CEO Frank Bean before Google acquired his company for $2.6 billion. We want to see a real pervasive data culture, and then the rest flows behind that. If you'd like to subscribe, go to getlatka.com.
There, you'll find a private RSS feed that you can add to your favorite podcast listening tool, along with other subscriber-only content. Now look, I never want money to be the reason you can't listen to episodes. On the checkout page, you'll see an option to request free access. I grant 100% of those requests, no questions asked. Hello everyone, my guest today is Yonatan Volovelsky.
He's building a company called Jiga3D.com. It's an on-demand manufacturing tool that makes this stuff easier, ordering parts easier. Yonatan, you ready to take us to the top? Yeah, how's it going, Nathan? Thanks for having me here. You bet. So what does the company do and how do you guys make money?
So what we do, we connect manufacturers with clients such as engineering companies and mechanical engineering. And the real motivation for getting this done was Asaf, my co-founder. He used to manage, as I see, a few 3D companies and then he quit to do something completely different. What happened when he started working on the other thing is that
People called him from his previous work and told him, like, okay, we want some pricing for some model. We want some pricing for some 3D work. And he said, like, no, I'm not interested. I'm doing my other startup. And after maybe 10 or 15 calls like that, he realized there is a little bit of business here.
So what we did in the beginning to just validate this idea was to make a simple online form where people, mechanical engineering and such, would upload their STL. STL is like a file. for mechanical engineers when they want to print their parts. So they just upload it and we will tell them, okay, there is a fancy algorithm that will do the price quoting for you in real time.
And actually it was just Asaf answering emails really, really fast. After we validated with a few customers, we decided we were really going to develop such an algorithm and this is what we did. So how many customers are paying for the tool today? Okay, so here are some numbers. I know you like numbers. So we started this company in March. We launched in mid-April. We have 15 manufacturers.
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Chapter 2: What is Jiga3D and how does it connect engineers to manufacturers?
There's a lot of work that's supposed to be scheduled. It's now don't have it anymore, so they need more work. So this is the easy part to get them on board. The hard part about it is that most of them are a little bit old school, especially when it comes to sheet metal and CNC.
They're a little bit more old school, so you need to show them and they see the product and they're like, wow, this is the future. I just came back from a meeting with a really old school CNC guy and he said, wow, this is what you do. This is completely the future, but he didn't really understand how the algorithm works and so on. Yeah, the challenging part, when... Yonatan, sorry, sorry.
Can you name a manufacturer that you would connect, like that Coca-Cola would connect with through your platform? Unfortunately, I'm not allowed to provide any of the names of the manufacturers, and this is by the contract we have. But I'm just saying that we're operating now in Israel, and we have a few manufacturers.
Most of our manufacturers are in Israel, and some of them in Europe, in Italy, and some of them in China. Can you name a manufacturer that you currently don't have as a customer but is similar to customers you do have? Yes, I can think about... Like, is Foxconn in China, is that the kind of manufacturer you're talking about? Yeah, yeah. It's smaller than this, smaller than this.
So something it's not so familiar with. So, like, we have manufacturing in China with about 400 employees. So in China, we consider, like, a small, medium manufacturer. I see. Okay, got it. So your key KPI is sort of number of transactions through your platform on a monthly basis because you know you make $600 on average per transaction. Yes. I see. Okay. So what's next? How do you drive growth?
So the challenging part is actually getting more clients. What we do, we do basic, classic content marketing and buying media. So everything we make from the platform, we put into marketing, most of it. We don't withdraw salaries at the moment. We go completely bootstrap. How many of you are there? We are three. So it's me, I'm the technical guy, and I develop the algorithm and all the front end.
And we have Adar, he's the marketing genius. And we have Asaf, which to contribute is about 10 years of experience in the field. And what are you paying right now to get a new customer? So to get a new customer that puts one $2,000 transaction through you in a month, how much will you pay to get that customer? Well, at the moment, we pay really nothing because most of our effort is not paid.
We pay very little for buying ads. We do a lot of content marketing hacking, so we basically have a lot of content about 3D materials. We just did a crazy, crazy project. We shrouded the internet for all the 3D materials and the 3D processes, and we hope this will drive more traffic through. through SEO. And we do a lot of community. We created our own WhatsApp and Facebook group.
So mechanical engineers are engaged with us. So guys, up until April of this year, I used to pay a full-time designer $3,000 per month to handle things like blog images, podcast logos, slide decks, and things of that nature. And then a guy named Russ Perry came on the show. You guys might remember it. His company is called Design Pickle.
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Chapter 3: How many customers are currently using the Jiga3D platform?
How can you spell that? Xometry. It's with an X. So we in Israel, we told them, I don't know what is the American pronunciation, to be honest. They make, according to the Internet, they make about $100 million per year. So we hope we can reach something like that in three to five years. Yeah, they say parts in as fast as a day, over 4,000 partners, always open.
They've probably raised a bunch of money. They focus on CNC machining, 3D printing, injection molding, sheet metal, etc. That's correct. So why would a company, you know, they list Dell Technologies and NASA on their homepage as customers. How do you win over NASA and Dell Technologies from Xometry? Oh, yeah.
You'd think that the competition will be hard, and competition is hard, but there's so much pros and there's so much to do in this market. For example, we are operating mainly in Israel and in Europe, and most of our customers don't even know about Xometry. There is so much more. Okay, so we're not going to get NASA anytime soon, but we're going to get other.
We work with really, really big clients now in Israel. We're trying to get a deal, and this is companies that are in size that are maybe a quarter of NASA or something like this. We're working with medical startups and with defense startups and some stuff. I'm not allowed to talk about it because my co-founders will kill me if I do, but it's really, really, really big.
As you know, Israel is really big with all the defense industry. Yeah. Do you guys have strong... Are you guys all Israelis? Yes. Obviously, do you have connections to the defense industry? Everybody in Israel do. Just checking.
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Chapter 4: How does Jiga3D generate revenue and what are its profit margins?
I want to make sure. So do you plan on raising capital or do you want to stay bootstrapped? So... My personal preference would be to be a bootstrap. My last startup, which was merged by another big company, so it was bootstrap all the time, and I really believe in this method. But we never say never.
If there's some really good VC with what we call smart money will come and give us a really good offer, we wouldn't say no because it would really accelerate our growth.
Chapter 5: What does a typical transaction look like on Jiga3D?
So something we will do ourselves alone for one or two years with a VC funding, it will take us a few months or so. What do you think Xometry has raised? I mean, they raised $118 million. What do you think they've used it on? Um, Xometry, Xometry is a little bit different, uh, because they have, they are manufacturers themselves. So they have, they have the machines themselves. So, um,
I don't know, but I would imagine they will do a lot of marketing and I imagine they will do some stuff inside their accounting to support their manufacturing and optimize their manufacturing costs. And we don't do it and we don't believe that we should own machines because Airbnb and Booking, they are like the biggest hotel chain in the world.
And we believe that we can be the biggest manufacturers without any machines. Owning equipment, yeah. You can keep critical distribution channel. Very good. All right. Let's wrap up here with the famous five. Number one, what's your favorite business book? My favorite business book. It's called by Dan Ariely. It's predictably irrational. Correct.
Number two, is there a CEO you're following or studying? Okay, Josh Pickford is the CEO of BareMetrics and he completely bootstrapped and he's doing a lot of things and I'm really admiring his attention span doing like so many things at the same time. Number three, what's your favorite online tool for building your company? Ubersuggest by Neil Patel.
Number three, how many hours of sleep are you getting every night? About eight. And what's your situation, Jonathan? Married, single, kids? Single. Okay, no kids? No kids. And how old are you? I'm 33 on Sunday. Oh, happy early birthday. Thank you. All right, last question. What do you wish you knew when you were 20? Be more focused in life.
Guys, there you have it, giga3d.com, hoping to be the marketplace that manufacturers at Coca-Cola or engineers at Coca-Cola and these big companies go to to find manufacturers to put new parts, new prototypes through. They're scaling nicely. Triple threat, team of three folks doing this full time. They've got about 10 transactions have gone through their system so far at about 2K a pop.
10 of those customers, sorry, 30 transactions I've gone through at 2k a pop, 10 customers total. So two to three kind of transactions per customer as I look to scale, currently doing about $12,000 per month in revenue. Jonathan, thank you for taking us to the top. Thank you very much, Nathan, for having me here.
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