How Airtory CEO Ashwin Krishnakumar grew Airtory to $3M revenue and 60 customers in 2024.

guys his first company sold for 42.5 million bucks he made called a million bucks off that deal learned a lot about Equity cap table and eventually uh joined and built his own company called eritory.com launched in 2017 they're helping advertisers of the platform helps them manage ads produce ads uh they white label two ad agencies who haven't have end clients they make money off SAS services and utilization fees doing about 1.6 sorry about 120 000 a month right now in Revenue up from call it like 80 or 90 grand a month just a year ago so nice a nice grow at their profitable today they've raised just uh 400 000 bucks in their last seat around about 10 million post money valuation uh growing profitably which we loved hey folks my guest today is Julian frockman he's previously founded perk.com a mobile loyalty and rewards platform which was acquired by Rhythm one and ended up at taptica or Tremor he's now focused on improving the lives of agencies and Publishers by enabling them to quickly and easily create rich media and see to the ad units at scale uh he's doing this at airtori.com Julian you ready to take us to the top sure let's go all right um talk to me a little bit about a customer that's paying you today can you share their use case uh sure one one of our kind of most uh recognizable customers is the arena group and so they own Sports Illustrated they own um raid men's Men's Journal uh different periodicals like that and so for them essentially they use us because we're able to work with them to create custom ad unit templates that allow them to create kind of an enhanced experience on their websites that perform more highly for their advertisers and based off of our templated approach they're able to have a much higher performance and for them charge a higher CPM which is a higher cost per thousand Impressions they deliver and what is a company uh like Arena group pay you on average per month or year to use the technology um so for them it's it's kind of a mix of CPM and so for us like as I mentioned when I uh when I kind of signed up with you it's a mix of SAS services and utilization so for them I would say we're probably at like five to eight thousand per month it's not always the same I would say they're a little bit higher than average um okay but it's average my average might be something more like three or four thousand per month combined across SAS services and utilities utilization sorry yeah I mean we have some whales right we have one customer um that I that I can't mention necessarily that's uh 60 to 70 000 per month right but I would say on average it's like four to eight thousand do you think you can get that that biggest we won't name them but can you get that because customer over a million dollar Mark here in the next 12 or 24 months in terms of ACV um I think we can but I think you know the interesting thing about our space is we're a tool they utilize based off of their ability to be effective on sales for themselves so they happen to be a really effective sales driven organization and so they're growing 20 30 40 per year and so they on their own will grow to that amount likely uh but it's not necessarily based off of anything that we do like we work with them we help well you have to set your price you have to set your pricing structure up in a way that captures the upside as they're growing I mean that's a key moment here Founders mess it up all the time so how are you up you know if they grow it could be by number of seats it could be by some other number of AD campaign per month metric I mean what is the thing you're upselling against also you know again we're we're not like a pure SAS platform um so I know but utilization is the same thing right so utilization might be number of AD units what is the utilization metric you're you're selling against uh impression volume honestly there we go so it's impression volume so so if they if they grow themselves from a billion Impressions per year to a billion two Impressions per year they're naturally going to pay you 20 more yeah exactly yes that is that is 100 the case so we already have that in place because naturally based off volume we charge a certain impression uh CPM so that's that's what we have Keaton for for us we kind of like pride ourselves on trying to be not as SAS oriented which I know is like not not quite the focus of this podcast but I see a lot of companies in the ad Tech martack space trying to be SAS when they're not which I think is long-term a mistake uh and they do this because they think they can get better multiples obviously that may have made more uh sense in the previous economic world that we lived in versus today but some of the other players they like lock customers into annual agreements and monthly minimums and things like that that make the companies look more like SAS they can get those types of uh multiples If they raise or if they sail sell um but at the end of the day it's all based off a volume of Impressions like we're all just kind of like technology that people use to deliver ad impressions 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 past 88 days and even set goals for evaluation this year now the secret valuation is there's many different ways to value a SAS business so the reason you're going to see three or four different evaluations inside of your founder path dashboard this is all free by the way is because depending on who's doing the buying of your SAS company you're going to get a different valuation a VC is going to pay a different valuation private Equity Firm is different if you're going to do a minority sale that's different and if you sell the whole business that's a different valuation you can see all those when I hover over here here right so the teal is what a VC would pay yellow is what private equity and red is if you sold the whole thing outright now what's cool about this is this is not built off random data again you guys hear these interviews on YouTube all these datas are built from real-time valuation data points Founders share with us on the show so traction 1.2 million seed round 3.7 raise they sold 22 percent of their business go in here and filter by the event maybe you only want to see companies that have sold the whole business well here are a bunch that have been acquired the valuation and the multiple maybe you're going out right now and you're raising your seed round well go in here and look at all this recent seed deals that went down what they raised what valuation they raised at and what percent that they sold there's never been a larger data set of SAS valuation than what you can get now inside of founder path and we're thrilled to bring it to you all right we're gonna go back to the YouTube video here in a second but if you want to check this tool out if you want to jump in and sign up you can check it out for free to get your valuation at this link this link founderpath.com forward slash products forward slash evaluations or if you go to founderpath.com and hover over products click on get your evaluation here and go ahead and sign up to give it a whirl again all that valuation data live right inside the platform I hope to see you there all right let's jump back into the interview so why have SAS at all why not you said SAS services and utilization why not kill your SAS business um so we we have like just a taste of SASS and so it's white labeling right and so if a customer wants to not present the eritori brand or any of our other brands up front when they're delivering the ads either on the preview side or if they want to have uh API access for advanced reporting or Advanced creative uh interactivity on kind of their front inside then that's something we'll charge either a thousand or 1500 per month for and so that's basically our only SAS so they'll just be clear this would be like this would be like an agency that manage the ad spend for other customers if they want to show the process to their customers they might pay you to White Label eritory yeah or like they built out an ad and they don't want to say preview.eratory.com they want it to say preview.xyz.com yeah supposed to be like adtoro media some of these companies you list on your website scroll media yeah exactly I see okay interesting get put this on a timeline for us when did you launch this business uh six or seven years ago okay so what that would have been 20 2017. uh yeah yeah about okay so you get going in 2017 and have you bootstrapped later you decide to raise capital um so we raised friends and family and friendly Angels so we've raised 750k total half of that was at 2.5 million safe and half of that was at uh 10 million dollars safe what year was the 2.5 2.5 was during the first like two years from it's about 2018. yeah 2017 2018. and how much did you raise on the 2.5 so like 400 500 375 or so 375 400. okay okay and I guess why um uh why did you need the money in the first place why not keep 100 percent um we didn't know what we were doing and uh we just needed to be able to operate so I guess uh you know you mentioned the background with uh with perk back in the day so that was like in Austin in uh bangalore-based uh company and so uh my co-founder Ashwin is based in Bangalore he was a third engineering hire at perk so we've known each other for about 10 years now so even when we were getting started we still needed to like he and I weren't paying ourselves we still needed to be able to pay engineers in India and so for that you know we needed to raise some money and we explored hiring product people we explored hiring sales people a lot of things didn't work out um so at this point Julian what was your role at perk.com I'm seeing Founders listen as Adam Solomon and Raj so I was a co-founder um all right there's a story there share it what happened um so this happens all the time so I trust me the one every out of every three interviews there's some terrible co-founder story so what happened all right I'm actually happy to share it that's great I don't look bad in it so it's fine yeah yeah um so I mean honestly so I I actually was not a great student in college we'll go back to the beginning how much time do we have we're good we've got eight minutes left all right yeah I can I can talk quickly I was not a great student so I like had no idea what I was doing found a job on Craigslist um with Raj he was trying back in the day to build out like a yipid competitor do you remember yipit back in the day like that I I don't but I'm with you that's how you met Raj it's a daily deal uh aggregate company like and he also had a white label solution similar to like uh Groupon and living social and stuff so join that as an employee he was running out of money and he was like hey you can join as a co-founder my dad also invested in the company he was like okay if I can invest then like you can make some money or whatever early you can at least have a salary so did that was there for a while um Adam joined and uh I ended up being like relegated a little bit as like the younger baby co-founder out of all of it did you get like crammed down so you're only sitting on like five ten percent at this point uh My Equity did get crammed down which I think with my experience now I would have fought back on I think yeah completely legally I'm not sure how kosher it was but it you know we're probably beyond anything on that yep um but I mean one point which is nice is my dad just put money in so I could get a salary but he did get 16x on the exit so that's like you know good for my dad so how much did he invest uh six 50k 60k okay that's pretty good yeah because yeah the reason I brought this up is this wasn't a small exit I mean it's a 42.5 million dollar exit based off my research correct uh yeah correct yeah I mean so this is a the reason I bring all this up is I was going to lead this into your current company I mean this maybe it wasn't like you money but I mean you you made some money off this exit your dad sounds like made some money why not sell fund um well so I mean I I did that in a lot of ways in that I didn't pay myself for three years right so with the perk eventually I made like 1 million right which is like definitely not you money um but it's something I mean that's a big that's a good win early on right but like I was I married we like we had a kid and stuff so you know it was something where just just like by not paying myself it was like I also like to uh Angel invests a lot um so my my wife eventually cut me off of that um but I did I did have one lucky Angel investment um one of my close friends uh from being in Austin uh is one of the founders of substack so I was an early investor there so that was like a solid win so yep that's a great story okay but point being 375k pre-seed round in 2017 2018 at 2.5 posts then you raise another 400k it sounds like a 10 post when was that uh that was the next three years basically okay got it okay so now you're off to the races are you do you have the company now to where you're totally sustainable profitable at this point yeah yeah we're we're profitable we hit a million two years ago last year we hit 1.3 in narr and yeah gross revenue right uh that's great and I think this year will be 1.5 to 2. I mean we have a few new products launching um so I feel really positive about where we are right now and just trying to figure out like what like you know it sounds like dumb but like what to do with the money right like I it's I've had struggles trying to figure out how to scale sales um maybe it's like get enough in the piggy bank to acquire a competitor who's tired of being in the market do you have a Target list uh yeah they're like two basically how much money would you need to get the deal done you think uh uh depends what multiple they want let's say it's the multiple you want to pay uh uh eight okay it's only about eight million to get it done eight to ten yeah I actually know uh your guy um who's on the uh the BD side for your lending platform oh for founder path yeah yeah we one of the things we look for are creative Founders have a vision for how they want to do a roll-up we love putting money behind those kinds of hounders yeah I I had talked to him when he was at the San Antonio uh group oh good good yeah Chris Chris Som he was at active Capital yeah exactly yeah Chris um so I've messaged with him and so he was like yeah reach out when you like get to that point so that's awesome that's awesome so how many customers are you working with today uh we're like 60 or so 60 okay I mean so 60 paying that our poo earlier like four thousand okay I mean maybe maybe that wasn't an average maybe the average is you know less than that but point being is you're doing something what you're doing something like like a hundred and twenty thousand a month right now on average in Revenue yeah uh about that and the mar the margins after we get through like my revenue or my salary my Founders out my co-founder salary and everything the margins are very good and we can talk about that offline but they're absolutely that's great okay so any plans to to raise more Equity here you just want to keep chugging along on cash flows right now keep checking along cash flows um don't want to do any dilutive rays but definitely interested in conversations related to like roll-up conversations yeah yeah yeah very cool we're rooting for you we appreciate you telling us more about the business today in the meantime let's wrap up here with the famous five number one what's your favorite book um my favorite book is loving the Time of Cholera Love in the Time of what cholera cholera okay number two is there a CEO you're following or studying um there's not really I mean I would say it just like in terms of kind of Doom scrolling Elon musk's just to see like what happens next number three what's your favorite online tool for building inventory uh slack and number four how many hours of sleep do you get every night well my two-year-old wakes up every night at like 5 15 so probably like six or seven if I'm lucky all right so so married and one kid two kids two kiddos okay and how old are you uh I am 38. last question something you wish you knew when you were 20. um I guess I kind of already knew it but it doesn't matter if you do well at school yeah that is true guys his first company sold for 42.5 million bucks he made called a million bucks off that deal learned a lot about Equity cap table and eventually uh joined and built his own company called eritory.com launched in 2017 they're helping advertisers so the platform that helps them manage ads produce ads uh they white label two ad agencies rather than have end clients they make money off SAS services and utilization fees doing about 1.6 sorry about 120 000 a month right now in Revenue up from call it like 80 or 90 grand a month just a year ago so nice a nice grow out there profitable today they've raised just uh 400 000 bucks in their last seed run to the 10 million post money evaluation uh growing profitably which we love Julian thanks for taking us to the top thank you very much 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 black community for B2B SAS Founders you want to get in there we've probably 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