SaaS Interviews with CEOs, Startups, Founders
Wild! He Presold $250k Of His SaaS Idea. Now wants to beat SEMRush
13 Feb 2021
Chapter 1: What is the main topic discussed in this episode?
How many customers do you have that are paying you something monthly? Okay, that number is really, really low. Like how low? That number between 20 and 50. 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. When you subscribe, you won't hear ads like this one.
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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 Ahmed Qureshi. He quit his job to start a MarTech SaaS startup and then survived the COVID recession and raised funds without selling any equity.
He went from two features to 11 within four months and raised enough funds to fund their future without the need of any investors. The company is called BrandOverflow.com, an all-in-one SEO platform. Ahmed, you ready to take us to the top? Yeah, sure. We started out in 2019. And how much capital did you raise and how did you do this without selling any equity?
Okay, I raised around $250,000, a little over $250,000 in 2020. But how did you do that without selling any equity? By creating future debt. We sold lifetime deals to our software product. Okay, but doesn't that kill your ability to upsell customers in the future if you let them pay one time for their whole life? Definitely.
That's why we created the deal in a very isolated environment so that we can... try to get those super early beta testers that can really support our vision. Because we were in a really saturated market. We were already up against really big companies that were already dominating that kind of space. We needed to create space for ourselves. So what was the lifetime deal? How much did you charge?
We had several packages. The regular package cost around $299. $299 for life, and how many did you sell? We sold around, we had several packages, so the prices may vary. We sold around 400 to 500 deals a week. Okay, and which platform, like how did you sell 400? How did you get traffic? The first thing we did was we went to Stack Social. Everybody goes to Stack Social for the lifetime deals.
We generated a little bit of revenue from there. And then we moved to isolated Facebook groups where there are like hardcore SaaS users, B2B users, agency owners. They were looking for ways to cut down on their costs. And there we were. So can you name one or two of those groups? Yeah, definitely. One of them is Digital Think. Okay. And what's another one?
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Chapter 2: How did Ahmed Qureshi raise $250,000 without selling equity?
They're also competing for better deals to come to them instead of going to AppSumo. So there's a little bit of exclusivity there as well. Yeah, but AppSumo, that's a huge difference. AppSumo takes like 60%. So they could have came in just under AppSumo. Why go all the way down to 10%? Because if I go to AppSumo, I could have generated over a million dollars.
And out of that, I would have paid a lot more. And that's just by one deal. I'm talking about multiple deals that I've been running throughout 2020, not just one deal at AppSumo. At AppSumo, I would have had a lot more users to take care of with a lot less money. Well, I know that's building my point though, Ahmed. That's my exact point is you don't want to pay AppSumo all that money.
So you go negotiate one-on-one deals with group owners. You want that too. So I'm just curious how you convince them to only take a 10% cut when AppSumo takes 70, 60% cut. I did not convince them. They are actually trying to get deals into these Facebook groups. The regular cuts there are 10 to 20% at most.
affiliate cut at normal, what AppSumo pays their own affiliates is around 25% or 20% at most. So they act as affiliates. They take those small cuts and they boost the deal by themselves. They review it themselves. They do the live streams themselves. They do everything themselves. And we have, I've done several live streams.
My YouTube channel is, it's not that big, but I've uploaded all my live streams there and they have been interviewing me, asking me about the product. We've been gone deep into every single feature that I have released. Got it. So ignoring the lifetime, I understand now how you got upfront cash to invest in growing the company. Ignore all those customers for a second.
How many customers do you have that are paying you something monthly? Okay, that number is really, really low.
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Chapter 3: What challenges did Ahmed face during the COVID recession?
Like how low? That number is between 20 and 50. Okay, and what do they pay per month? Yeah, we never had any money to invest into marketing or get those MRR customers. How much do the 20 customers pay per month? They pay around $69 to $150 a month. Okay, got it. So that's something like you're doing like $1,400 a month in true recurring revenue. Definitely. Okay.
So how do you make this business sustainable? Because you've just promised 400 people you're going to be around forever because you sold them a lifetime deal. But this business is not sustainable at $1,400 a month in total revenue coming in. At some point, what happens? All right. That's the best part of it. We stopped working on getting new MRR customers around February of March 2020.
That's when we started pushing out these lifetime deals. So it's been around a year since we stopped. In that time, we started focusing completely on lifetime deals to get that cash first. With the cash that I have right now, I have a runway of around two years. With my current team that I hired, how many, how many people are on the team? Uh, four people plus me.
And, and what's your total headcount expenses per month? Uh, it's around a thousand to $2,000 a month to pay five people. Yeah. How are people surviving on, on, I mean, you're, you're paying people on average 450 bucks a month to work for you full time. Yeah. Including myself. That's what I earn.
Chapter 4: How did BrandOverflow.com differentiate itself in a saturated market?
That's what I keep for myself as well. Where are these people? Where are they living in the world? Okay, got it. So this is starting to make sense, right? So they're living in Pakistan. You pay them 400 bucks, 500 bucks a month. Where are you living? In Pakistan. You're also in Pakistan. Yeah. Got it. Our living costs are really, really low. Um, fair enough.
Chapter 5: What strategy did Ahmed use to sell lifetime deals?
The question then will that people will say, well, how high quality product can you build with engineers who can only command a $400 a month salary? Many people would say, well, maybe they're not great engineers. Okay. Then that would go to me. I'm the CTO. I built 99% of the core tech behind this product.
Uh, we are comparable to we're almost comparable to HRS and SEM brush judging by the reviews that I get. by the customers themselves. We compare our data with the address and SEMrush. We've been featured in HubSpot just recently, organically, completely organic. And why then why do you have then why do you have to do gimmicky lifetime deals to bring in upfront cash?
Why don't just you just close people on monthly recurring revenue or annual upfront cash payments? This core technology took time to build and do everything like We finished building our technology back in November 2020. So all that time, what do we do? How do we survive? That was the main question. All of my emails, all of my marketing tactics just failed as soon as COVID hit.
Everybody just went into silent mode. Nobody wanted recurring subscriptions to SEO tools that would just offer monitoring and keyword research and all those things. They wanted to get out of all those recurring expenses. It was a very tough time for everybody. And how do you split? Do you own 100% equity in the business? Yeah.
Okay, so what about like Osama Khan and Usman Ghani and Sidra Joffrey on your website? You don't give them any equity? Okay, interesting. So what's the next step? I mean, how do you scale this? How do you scale monthly recurring revenue? Starting February 1st, we started working on our MRR, cold emails, outreach, marketing, Reddit, advertising, new website, everything.
We're working across the board on every single thing that we ignored for the last year. My team was hired around six months ago. Until then, I was just flying solo. Okay, so how are you going to get a thousand customers paying $70 a month? Do you think Reddit threads are going to do the trick? It's a starting point. It's better than not doing anything at all.
The first thing that I'm going to do is reach out to all the business owners that have been contacting me during the lifetime deal. During the lifetime deal that they did not want access to those lifetime deals at the moment, they were just considering it about the core tech first. They wanted good data instead of getting a lifetime deal earlier and with a promise of better data later on.
I have a list of over 200 or 300 interested businesses over the last year that I have to build up upon. If you couldn't convince them, if you couldn't convince them to pay you a one-time discounted lifetime fee, what makes you believe you're gonna be able to pay them? It convinced them to pay you 70 bucks a month or $840 a year.
That's because most of the lifetime deals, they come out with big promises, but they never deliver. We just rolled out our seventh, seventh update in the last six months. We have a very good reputation at the moment just because of word of mouth. We say something and we get it done with it by the end of the month. How do you measure success? Are people using the platform? Yes, they are.
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Chapter 6: How many customers does BrandOverflow have and what do they pay?
I see. All right. What's your situation? Married single kids. Single. No kids? No kids. And how old are you? I'm 27. 27. Last question. What's something you wish you knew when you were 20? Jazz. JavaScript.
javascript earlier on guys he's trying to compete with ahs and semrush he launched brand overflow self-funded by selling lifetime deals to his customers did quarter million dollars worth of these sales and facebook groups and things like that kept a big chunk of that revenue now as a team of five six seven eight people as he builds out the technology piece of his business and convinces people to pay monthly recurring fees 20 customers on the mr plans right now doing about 16 000 bucks in ars he looks to continue to scale ahmed thanks for taking us to the top