Otamiser Revenue (2024)

guys lareca.be helps hotel chains make more money with their algorithm they did about 250 000 in Revenue last year hoping for a million this year they served 290 customers paying on average 250-ish bucks a month that would be a million dollar run rate they're building this around with a team of seven and bartjen owns 100 totally bootstrapped today launched it as a student Now 23 years old we'll see what he does next hey folks my guest today is Bart Johny yes he's a 23 year old entrepreneur who founded Loretta Loretta is an Innovative startup who it boasts the revenue of hotels by an average of 24 by giving visibility optimization for rental properties all right part January tickets to the top hi hello everyone hello thanks for holding here so just to be clear kick us off here you're selling software to Hotel owners so they can make more money um something like that we're selling algorithms so it's not really software it's more like an algorithm but at the end of the right they make more money okay and help me understand what your average customer might look like can you talk about a customer can you name one of them yeah we have uh so right now we have 290 customers all around Western Europe so it goes from hotels from 20 rooms to hotels with 60 70 rooms uh most of the time they are like hotels who really suffered due to the pandemic due to their recent crisis in Europe and they really need some way out to help them the other part of our customers are really that's like owners who like try to maximize everything they have and they then they use our algorithm to maximize their what does that mean someone with an extra bedroom will use your algorithm to figure out how they can rent their bedroom um so we have some of them um some of those like uh people who are like uh trying to make some extra money like from the beginning days where we were testing our algorithm on different kind of short-term rentals but nowadays our focus is really to the hotels really the bigger and on average like on average where these hotels paying you per month to use your algorithm uh it's around 2000 uh but it depends as we work with the no cure no base so we take cuts on everything we earn more okay so people are paying two thousand dollars US dollars per month on average yeah something like that it all depends on the you know the region the the number of rooms all these things okay well well help us understand that right so what do you price per room so like our pricing models look look like this so um we like calculate Based on data the probability that they will obtain like the same Revenue as a given year and then we like um we put it equal like it calls discounting and we put it like equal with market demand inflation all these things and with this we um like to distribute how much money we make extra I promise extra money um we take cut but this cut is like it all depends on what cut do you take uh it's most of the time 25 percent okay so if someone without Loretta is going to make a hundred thousand a year but somebody with Loretta is going to make 200 000 a year you'll take the Delta of a hundred thousand dollars and take 25 percent of The Upside you helped create or twenty five thousand dollars yes but um important side note there is like when someone would make 100 and now 200 we have to like deduct inflation market demand so like it's never like an absolute number of 100 it's always like 80 or 17 and from the 70 we take a cut oh what's going on there YouTube good to see you guys now imagine this you love watching these interviews with SAS Founders but imagine if we took all of the valuation data out from over 2807 interviews I've done manually saves you a lot of time well we've done this we've built the into the beautiful interface inside of founder path check this out I'll show you how you can access this in a second but you log in you connect your stripe account you see your valuation real time you can see what it changed over the 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all that valuation data live right inside the platform I hope to see you there all right let's jump back into the interview when you look at um how much revenue the 290 hotels on your platform today how much revenue do you think they'll all do together in 2023 oh that's a very hard question as you have why is it hard I thought that's what your algorithm calculates you just told me that's what it calculates yeah exactly but um we have some of them who like are on board it's um in in July last year meaning that they have like a different time span so it's hard but I think um it's around 22 million that we earn extra um last year so this year will be hard with uh to predict with last year's 22. okay just to be clear that 220 to 290 hotels you're working with today the ones that were you working with last year you helped them earn 22 million more than what their base was right exactly and you take 25 of that exactly so 25 of 22 million is you guys about 5.5 million in Revenue last year no that's a very good question and we we had a very long um proof of work where we like we were working at very low margins just like um so we could like build a proper business case to go to uh these bigger hotels um and ask for like the the revenue model we used today so it's like not even that long like I think three months that we work with this model but okay I don't want to lose my audience here because like this is a little bit confusing right so you told me you make 25 but then you don't make 25 and you told me you charge two thousand dollars per hotel with 290 hotels which would mean you're doing 580 000 per month in Revenue it sounds like neither of those numbers are accurate so how do you price what do you charge it's 25 but important to know is that from all of our hotels like um there's a big range due to our early days we still have like little clients um bed and breakfast from tree rooms but we also have the biggest so it's very hard to put like an absolute number but the first number I saw when I popped up my screen was a 22. so it's very hard to like really determine them what do you think you will do this year in total revenue uh we hope um to be 1 million certainly this is like for like least least that we should have okay and and what does that mean you did 200 000 last year or 300 000 last year yeah okay this is great well I guess give me the back story here now that we understand the financial model when did you launch the company what year um July 2021 as a student it's like an extra holiday Merit okay and now are you still in score did you drop out to build the company I graduated a couple of months later and now I have a full-time team who is um building the company with me how many folks are on the team today we are um seven in total seven people and are you the only founder yes okay so your sole founder you own 100 no co-founder I'm sick and are you bootstrapped today or have you raised capital we have good scripts we are a raising capital is still on the plans but uh it's something we have to decide why do you need Capital to build this business why not keep 100 in bootstrap exactly that's the thing we need to uh decide if we are going the way we are because we we are already obtaining wonderful results um are we going to raise Capital this is still a question that's on the table and we hope like in the student future to make a decision about uh who who is we though I mean you're the sole owner right so you're making all the decisions yes but I have uh luckily a wonderful team who is assisting me with the big questions do they own Equity though or no not yet not yet okay interesting okay and I guess how did you get to this pricing model I know it's very difficult we heard you sort of trying talking through it earlier it's very difficult this pricing it's hard to model why not just do something very simple a price per room per year or something like that because like um for us of course it's a very very good sales perspective we say like we are certain our algorithm works it sounds a bit arrogant but like we are certain that it works um and that's why we just take a cut of everything we earn more so in the worst case a hotel that uses and we don't work we don't earn extra money for them they don't need to pay us so like a hotel buy this by this pricing model has nothing to do by working with this and also it incentivize us to like make the most money for the hotel yeah but it's not just that it's so much extra work because you have to defend the extra money you're making the hotel the process to actually capture the revenue is so much more difficult exactly exactly but luckily hotel software is pretty advanced in this kind of things well I mean we heard you talk to the calculations earlier and you kept using words like it's confusing it's hard it's tough It's hard to estimate I'm not sure I mean why not just charge a flat fee and if you're not delivering value they'll churn and cancel uh that's also an option that's on the table uh like for us of course we are with this pricing model we're bound to seasonality so if um hospitality is doing bad or business will be doing bad as well but it's still something we're exploring but as of today it is okay talk to us a little bit about growth here it's impressive that you've got 290 customers less than 24 months after launch how did you hustle to get 290 paying customers already so I launched a student which so I'm from Belgium and in Belgium like if student launches a company they they get like a lot of press uh a lot of like magazines and so so this is where like all the star came and then I did like the basics really like the mailchimps the the block riding the podcasting all the basic things and this led us to having 290. we are also in an industry so the hotel industry which is very familiar so like you know one hotel and one street says okay these guys you have to work with them and then it starts spreading but marketing and rebranding is something that's uh for this month actually mm-hmm what you mentioned podcast you have your own podcast or you go on other people's podcasts um I have done some podcasts before or some podcasts before and we always had some wonderful results do you have your own podcast or do you only go on others no I don't know okay and how many subscribers do you have on your MailChimp list today oh that's a hard question uh I think it's around 8 000 but yeah um we were in a collaboration with some local government uh where we were able to get a big portion so it's not 8 000 uh like that subscribe to our website but we received some of them okay um well I mean is the email list a way that you get new customers yes we send out like a two weekly blog uh so a two Weekly Newsletter and we always have wonderful life expectations how many folks usually open and click we are around 30 percent so 30 open so that's about 2 000 out of the 8 000 open and then how many click no two sorry thirty percent of everyone clicks through our website reader look so if you send out an email to 8 000 people you're saying two thousand that's going to generate 2 000 clicks to your website yes exactly we're sorry every time we send out look it's crazy are you sure that's accurate that would be almost like 6X the top click-through performance I've ever heard of from an email list yeah I can check it right now so just be clear you send an email to 8 000 and you know six seven thousand of them open and then like 2 000 of them click in the email through to your blog that's what you're saying exactly that's a really high click-through rate how do you get so many people clicking we are lucky that like um so we are only like doing some local blogging and local newsletters so like our vlogists in multiple languages but our newsletter is uh like the people we send it to is not so we are lucky that so we are in Flanders in Belgium that a lot of people need services like this like we really need companies like us to like help them um move to the next step and this is why our block was like heavily written explain to me how your process is I mean you're a startup with constrained resources writing takes a lot of work your last blog post on October 16th is titled the seven most important kpis in the hotel business how did you identify that title as something you should write about um I will be honest I had like um several marketing people already in my company know the last one left and the the new one is awarded last week so it's something they decide to do some research about it but it's not not my expertise okay bargain on that note let's wrap up here with the famous five number one what's your favorite Business book oh it's uh the book from Jordan Belfort I can't remember the name so all right number number two is there a CEO you're following or studying oh I really like um he has like um a construction company what's the name of the company your place you place all right number three what's your favorite online tool for building Loretta it should be webflow I spent a lot of time on our website just because I want everything to be perfect and number four how many hours of sleep do you get every night I I'm happy if I get around five five okay and what's your situation married single kids I have a wonderful girlfriend not married okay no kids and you're 24 right 23 23 last question something you wish you knew when you were 20. [Music] um not to be too naive in business that's something I had to learn the hard way um and something I wish I knew a little bit more early guys loretta.be helps hotel chains make more money with their algorithm they did about 250 000 in Revenue last year hoping for a million this year they served 290 customers paying on average 250-ish bucks a month that would be a million dollar run rate they're building this around with a team of seven and Bart gen owns 100 totally bootstrap today launched it as a student Now 23 years old we'll see what he does next BART Jam thanks for taking us to the top thank you one more thing before you go we have a brand new show every Thursday at 1pm Central it's called Shark Tank for SAS we call it deal or bust one founder comes on three hungry buyers they try and do a deal live and the founder shares back-end dashboards their expenses their revenue our poo CAC LTV you name it they share it and the buyers try and make a deal live it is fun to watch every Thursday 1 p.m Central additionally remember these recorded founder interviews go live we release them here on YouTube every day at 2PM Central to make sure you don't miss any of that make sure you click the Subscribe button below here on YouTube the big red button and then click the little bell notification to make sure you get notifications when we do go live I wouldn't want you to miss breaking news in the SAS World whether it's an acquisition a big fundraise a big sale a big profitability statement or something else I don't want you to miss it additionally if you want to take this conversation deeper and further we have by far the largest private slack Community for B2B SAS Founders you want to get in there we've probably talked about your tool if you're running a company or your firm if you're investing you can go in there and quickly search and see what people are saying sign up for that at nathanlacka.com forward slash slack in the meantime I'm hanging out with you here on YouTube I'll be in the comments for the next 30 minutes feel free to let me know what you thought about this episode and if you enjoyed it click the thumbs up we get a lot of haters that are mad at how aggressive I am on these shows but I do it so that we can all learn we have to counter those people we got to push them away click the thumbs up below to count on them and know that I appreciate your guys's support all right I'll be in the comments see ya