SaaS Interviews with CEOs, Startups, Founders
This Bootstrapped Startup Makes Crazy High $4.5m in Revenue Per Engineer
21 Jun 2021
Chapter 1: How did Dux Soup achieve $4.5 million in revenue per engineer?
Do you think you can break $400,000 this year?
Well, that's definitely the forecast, yeah.
Well, what have you grown at over the past 12 months? If you're at $370,000 a month today in revenue, where were you a year ago?
I would say probably like $2,500.
You are listening to Conversations with Nathan Latka, where I sit down and interview the top SaaS founders, like Eric Wan from Zoom. If you'd like to subscribe, go to getlatka.com.
We've published thousands of these interviews, and if you want to sort through them quickly by revenue or churn, CAC, valuation, or other metrics, the easiest way to do that is to go to getlatka.com and use our filtering tool. It's like a big Excel sheet for all these podcast interviews. Check it out right now at getlatka.com. Hello, everyone. My guest today is Will Van Der Sanden.
He's building a company called Dux Soup. That's D-U-X-S-O-U-P.com. It's software for online lead generation. Will, you ready to take us to the top?
Absolutely.
Okay. So first off, it looks like you're playing pretty exclusively on LinkedIn. Is that correct?
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Chapter 2: What is the pricing model for Dux Soup's most popular packages?
He writes for Inc., LinkedIn, Social Media Examiner. He's been an entrepreneur on fire. He wrote a book called LinkedIn Riches, Content Marketing. All the placements that he writes for enables him to backlink to Will's company, right?
So if you want to go find your own John Nemo, you can go on LinkedIn, search for writers at these similar outlets and go try and incentivize them to promote your product. Now, Will, that's the big question. How did you incentivize John to promote your product over our competitors?
He just liked the way it worked. So you didn't pay him anything?
No commission, no anything?
Nothing at all, no, zero. He liked the way that the product worked. He liked the way that it was priced. And we also got along at a personal level, just, yeah, from conversations online. And yeah, so it was just a bit of a click and he was- Understood.
Hey, 15,000 customers, $25 average ARPU. That would put your MRR at about $325,000 or 375 per month. Is that right?
Yeah, it sounds about right.
Do you think you can break $400,000 this year?
Well, that's definitely the forecast, yeah.
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Chapter 3: How did the founder finance the first year of Dux Soup?
Yeah.
Okay. And are those usually high-paying customers or lower-paying customers, folks that are on the free trial or something?
It tends to be the lower ones. If you look at just the turbo edition especially, the churn, I would say, is probably less than 5%.
5% monthly, right?
Yeah, yeah, yeah.
That's still fairly high, right? That means you're churning 60% of your user base every year. How do you get churned down?
Well, we get churned down by growing customers. But there is a natural churn that you get in this market because a lot of people, they change jobs, they change, or they just change companies. So... There is just a natural churn that you will never avoid, and we reduce it by making a product that works and delivers to the people what they're looking for, and that is our strategy.
So the reason you're seeing 60% of your user base churn currently per year is because they tell you they're switching jobs?
Yeah, both jobs or projects, absolutely, yeah.
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Chapter 4: What growth strategies helped Dux Soup acquire 70,000 free users?
I would say 80%. My question to you as a capital allocator, as a founder trying to build wealth, get more freedom, etc. When you take 80% of $375,000 a month in revenue to the bottom line every month, I'm sure you don't just let the cash sit in the bank. How do you think about it? What do you do with the cash?
The cash is basically to make sure that the family is okay. You've got to take care of the family.
Well, yeah, but Will, just to be clear, I mean, 80% profit is $300,000 in profits per month. I mean, unless you've got 300 kids, you can't spend 300 grand a month on a family, I don't think.
No, no, no.
What I'm asking really is how you, as a smart guy building a business, think about capital allocation personally.
Oh, it's just investing in different assets.
So you're buying physical assets, houses, real estate, things like that?
Yeah, in the stock market.
Are you a crypto guy?
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