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Founder Interview

How Amber Book Reached $4.3M ARR and 90% EBITDA Margins Selling Test Prep to Architects (Interview with CEO Michael Ermann)

Interview Date
January 26, 2022
Interviewee
Michael ErmannCEO and Founder
Watch
Watch the full interview

Company Metrics at Interview Time

ARR (Jan 2022)

$4.3M

EBITDA Margin (2022)

90%

Firm Licences (Jan 2022)

150

Revenue Growth (YoY) (2021 vs 2020)

113%

Firm Licence Churn, Monthly (2022)

Under 1%

Historical Snapshot

These numbers were reported by Michael Ermann during his interview with Nathan Latka recorded in January 2022 and are a historical snapshot, not current figures. See Amber Book’s current numbers.

Key Takeaways

  • 01Amber Book reached $4.3M ARR in January 2022, up from $3.8M in full-year 2021.
  • 02The business grew 113% year over year comparing 2021 to 2020.
  • 0390% EBITDA margins on a fully bootstrapped, never-raised business.
  • 04150 firm licences generating approximately $700,000 per year, about 15% of total revenue.
  • 05Average individual subscription price is $250 per month; average firm licence is $2,400 per year.
  • 06Churn on firm licences is under 1% a month, though Michael described the firm product as fairly new.
  • 07Michael Ermann works only 8 hours per week on Amber Book by law as a Virginia Tech professor.
  • 08The course launched commercially in 2015 after content production began in 2014.
  • 09The firm licence product launched around 2019 and is the fastest-growing segment.

Company Metrics at Time of Interview

MetricValueSource
ARR (Jan 2022)$4.3MFounder interview, Jan 2022
Revenue (full year) (2021)$3.8MFounder interview, Jan 2022
Firm Licence Revenue (2022)$700,000Founder interview, Jan 2022
Average Individual Subscription Price (2022)$250 per monthFounder interview, Jan 2022
Average Firm Licence Value (2022)$2,400 per yearFounder interview, Jan 2022
Firm Licences (Jan 2022)150Founder interview, Jan 2022
Firm Licence Churn, Monthly (2022)Under 1%Founder interview, Jan 2022
EBITDA Margin (2022)90%Founder interview, Jan 2022
Revenue Growth (YoY) (2021 vs 2020)113%Founder interview, Jan 2022
Monthly Revenue (last 30 days) (Jan 2022)$363,000Founder interview, Jan 2022
Monthly Revenue (prior year same period) (Jan 2021)$220,000Founder interview, Jan 2022
Individual Enrolments (full year) (2021)2,800Founder interview, Jan 2022
Firm-Based Individual Enrolments (full year) (2021)2,100Founder interview, Jan 2022
Year Founded2014Founder interview, Jan 2022
Funding$0 (bootstrapped)Founder interview, Jan 2022

Growth Breakdown

Revenue

Amber Book reported $4.3M ARR in January 2022, calculated as $363,000 in the prior 30 days multiplied by 12. Full-year 2021 revenue was $3.8M, representing 113% growth over 2020. The firm licence segment contributed approximately $700,000, or about 15% of total revenue, with the remaining 85% coming from individual monthly subscriptions.

Customers

At the time of the interview, Amber Book had 150 firm licences and had recorded 2,800 individual sign-ups and 2,100 firm-based individual enrolments in 2021, for a combined 4,900 annual enrolments.

Team

Michael Ermann operates the business within a state-mandated limit of 8 hours per week as a Virginia Tech professor. The business had 3 to 4 people on payroll alongside contractors.

Profitability and Funding

Amber Book is 100% bootstrapped and has never raised outside capital. EBITDA margins stand at 90%, giving Michael the option to continue running the business at a steady pace while exploring a potential sale or bringing in an external CEO.

Growth Strategy

Word-of-Mouth Virality Within Firms

Individual students who pass the architecture licensing exam through Amber Book recommend the course to colleagues at their firms. Until shortly before the interview, Amber Book had no marketing spend at all, and this organic referral loop drove the majority of growth, including the rapid expansion of firm licences.

High-Quality Animated Content

Michael invested heavily in professional animation to differentiate the course from lower-quality competitors. The result is roughly 50 hours of animated content, approximately 1,000 flashcards, and approximately 1,000 practice questions, which earned Amber Book a reputation comparable to how customers feel about Trader Joe's or early Apple.

Firm Licence Expansion

Launched around 2019, the firm licence product converts individual student relationships into company-wide all-you-can-eat subscriptions at approximately $2,400 per year per firm. This B2B segment is the fastest-growing part of the business and carries very low churn.

Seasonal Demand Capture

New enrolments spike in early January as architects make New Year resolutions to get licensed. Because individual subscriptions average three to six months, this seasonal intake smooths into relatively steady monthly revenue throughout the year.

Teaching-Led Brand Authority

Michael's 21 years as a college professor and his reputation as a published author and award-winning teacher gave Amber Book immediate credibility in the architecture community. Weekly Zoom sessions with hundreds of students and one-on-one meetings reinforce the brand and reduce churn.

Best Quotes

“Our average is about $250 a month. And it's not really a pure play SaaS because there's an expectation that you'll pass and you'll finish and you'll pass. If we do our job should stop paying, right? Unlike most of the people you interview, we're actually thrilled when people leave us.”
“I have 149 firms. So 150, let's say, today.”
“It's 150 firms times, in that case, it's 100 times 2,400. So it's probably closer to 700,000 a year in that, but that's only about 15% of our business. Our ARR is 4,300,000 right now.”
“No, last year we did 3.8. Our ARR right now is 4.3.”
“363,000 is what we've done in the last thirty days.”
“We've grown a 113% between, you know, year over year 2022 or 2021 versus 2020. Most of the growth has come well, a lot of it's come in the firms and a lot of it's just come just kind of steady organic.”
“A 100% bootstrapped, never raised.”
“The rules for the state of Virginia are pretty strict. We're not allowed to work more than eight hours a week on our own business. So I'm pretty religious. I am very religious about that.”

What Happened Next

This page captures Amber Book as it stood in January 2022, when Michael Ermann reported $4.3M ARR, 90% EBITDA margins, and 150 firm licences on a fully bootstrapped business. At that time Michael was actively exploring options including a sale, bringing in an external CEO, or continuing to run the company himself within his 8-hour-per-week constraint. Visit the Amber Book company profile on GetLatka for current revenue, customer, and growth figures.

View Amber Book’s current profile and metrics

Full Transcript

Introduction: Michael Ermann and Amber Book

Nathan Latka

00:00Hey, folks. My guest today is Michael Ermann. He's an architect and author of the book Architectural Acoustics Illustrated and winner of 13 awards for teaching research and design. The design for his own house edition made from bubble wrap earned an international Architizer A+ design award last year. He's now building amber-book.com. It's test prep for architects. Michael, you ready to take us to the top?

Michael Ermann

00:21>> I am ready, Nathan.

Nathan Latka

00:22And we were just geeking out before the call. You're at Virginia Tech. I would have had you in, I guess, third or fourth year.

Michael Ermann

00:28>> I would have been your professor.

Nathan Latka

00:30That would have been crazy.

Michael Ermann

00:30>> Now, had I stuck around architecture.

Nathan Latka

00:32If I stuck around, I know, man. You know, honest truth, I was in Shelley Martin's studio that first year, and you guys you know how Burris, it's all open, so you sit next to 50 people. And I'd overhear fifth-years going, man, I'm only making like $60k a year. I'm like, tech's like one of the top architecture schools in the country. Yeah. Like, what's going on? And it was because of, oh, wait. The financial markets were terrible.

00:52Short.

Michael Ermann

00:53>> Sure.

Nathan Latka

00:54Like money too much. I have to drop out.

Michael Ermann

00:58>> It worked out for you, I think. It worked

Nathan Latka

01:00out I'm having fun. Alright. Tell me more about this. I did not know. Did I did I ever see your bubble wrap house, by way? Was it was it No.

Michael Ermann

01:06>> You didn't. It was not. Actually, it's three doors down from the house that you looked at. Yeah. So I put a actually, I'm in the room now. So you could see the bubble Yeah.

Nathan Latka

01:16Yeah. Yeah.

Michael Ermann

01:17>> Oh, wow. But I put an addition I put an addition made a bubble wrap because bubble wrap usually if you have thermal insulation, it's opaque. If you have daylight, it's transparent, but not very thermally insulative. And so I wanted to see if I could make something that was both let light in, let daylight in, but also

01:35>> kept me warm this time of year.

Origin Story: From Architecture Professor to Course Creator

Nathan Latka

01:37That's amazing. So tell me, like, how did you get the idea for Amber Book and when did you launch it?

Michael Ermann

01:42>> Yeah, so there are six exams. If you had stayed in architecture, you'd be in the middle right now of taking six exams to be an architect. So you can't call yourself an architect. You can't get your license until you've passed six exams. And the average pass rate for each exam is fifty eight percent. So it's pretty painful experience for some people. On average, it takes two and a half years between when you for just for those

02:07>> who finish, it takes two and a half years between when they pass their first when they take their first test and when they pass their last one. And that doesn't include the six months a year of studying that happens beforehand. Wow. So

02:19>> first I was teaching courses all around the country for like continuing ed to prep people for the exams and people kept asking me, would you do a video for this? Would you do an online course? And frankly, I'm not a big online course person. I'm kind of more of an in person person. And so I always said no, but the demand got high enough. One of my students was an animator and I said, Hey, could we

02:42>> do some animations and make a really good course and I'll figure out a recording studio to go to and we'll do it high quality and see what happens. So we started making animated content for prep for the class or prep for the test rather. And then we spun that out and it became

03:01>> the course itself. So we have about fifty hours of animation plus, you know, maybe a thousand flashcards and maybe a thousand practice questions.

Nathan Latka

03:10Well, it's beautiful. You know, I'm used to a world of Internet marketers coming on the show and they show me their courses and they look like shit. I look at yours, I go, oh my gosh. This is beautiful.

Michael Ermann

03:19>> I mean, is Yeah.

Nathan Latka

03:20Mean If Disney put out a core, an info product, this is what it would look like.

The Amber Book Course: Content, Quality, and Format

Michael Ermann

03:24>> Yeah, it's not Pixar. It's simple animation. But what we've been able to do is, I mean, imagine Pixar for fifty hours, but the cost. But we've been able to make some low cost and most importantly instructive. Like no one ever had a bad class with a good teacher. And so we've we've tried to make it instructive and helpful and and and we've become the we've become kind of a I don't know what the I don't know.

03:48>> People feel about us, like, I the way people feel about Trader Joe's or the way they used to feel about Apple or something like that. We've become the big player in the space.

03:56>> And and we've been able to help a lot of people Mhmm. Pass the exams and do it more efficiently. And it's kinda fun and, you know, it's not it's not like fun like what you'd wanna be doing if you had your choice, but it's much more fun than than the other modes of studying.

Nathan Latka

04:11Oh, what's going on there, YouTube? Good to see you guys. Now imagine this, you love watching these interviews with SaaS founders, but imagine if we took all of the valuation data out from over 2,807 interviews I've done manually, Saves you a lot of time. Well, we've done this. We've built it into the beautiful interface inside of Founderpath. Check this out. I'll show you how you can access this in a second, but you log in, you connect

04:34your Stripe account, you see your valuation real time. You can see what it changed over the past eighty eight days and even set goals for valuation this year. Now the secret evaluation is there's many different ways to value a SaaS business. So the reason you're gonna see three or four different valuations inside of your Founderpath dashboard, this is all free by the way, is because depending on who's doing the buying of your SaaS company, you're gonna

04:58get a different valuation. A VC is gonna pay a different valuation. Private equity firm is different. If you're gonna 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. 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

05:20not 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 1,200,000 seed round 3.7 raise. They sold 22% of their business. Go in here and filter by the event. Maybe you only wanna 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

05:46going 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 dataset of SaaS valuations than what you can get now inside of Founderpath. And we're thrilled to bring it to you. Alright. We're gonna go back to the YouTube video here in a second, but if

06:08you wanna check this tool out, if you wanna jump in and sign up, you can check it out for free to get your valuation at this link. This link, founderpath.com/products/valuations. Or if you go to founderpath.com and hover over products, click on get your valuation 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. Alright. Let's jump back into the

06:34interview. So what do people pay? Do they pay monthly? Is it one time? How do they pay?

Pricing Model: Individual Subscriptions and Firm Licences

Michael Ermann

06:39>> It's monthly. So it's a subscription. Actually, there's two different versions, right? So the It's a subscription and it runs about Well, our average is about $250 a month. And it's not really a pure play SaaS because there's an expectation that you'll pass and you'll finish and you'll pass. If we do our You job should stop paying, right? Right. Unlike most of the people you interview, we're actually thrilled when people leave us. We think that's a really

07:02>> cool thing. But we also started offering firm licenses as well. And the firm licenses are more up your alley. They're B2B SaaS or Evergreen. The average there for a firm is about maybe, we don't track those numbers, but I'm gonna say it's about $2,400 a year for everyone in the firm. It's like an all you can eat.

Nathan Latka

07:24That's interesting. And there, it's probably way more sticky, right?

Michael Ermann

07:27>> We would hope so. It's fairly new, but we our churn is less than 1% monthly and so it seems to be sticky and it's been around for a couple of years, just that there was COVID in the middle it. Just as things were picking up, the world kind of got weird when people, they closed the testing centers and people weren't taking the test for a while, so.

Nathan Latka

07:45So that was what, 2019 you launched the firm offer?

Michael Ermann

07:48>> Probably. Yeah. That sounds about right.

Nathan Latka

07:51And what, five, ten, 20 firms on that or more?

Firm Licence Numbers and ARR Breakdown

Michael Ermann

07:53>> I have 149 firms. So 150, let's say, today.

Nathan Latka

07:57That's a ton. I mean, so can I multiply that? 150 times 2,400, what? That's $360,000 a year?

Michael Ermann

08:03>> I think it's more than that. So it's 150 firms times, in that case, it's 100 times 2,400. So it's probably closer to 700,000 a year in that, but that's only about 15% of our business. Our ARR is 4,300,000 right now. Wow. Because most our subscription is, you know, we'll call it content as subscription

08:28>> is in the individual enrollments. But the firms is obviously the fastest growing part and probably the part that you would be most interested in. Well, look Well, If 85% of it's in the other side, maybe you wouldn't be.

Nathan Latka

08:40Well, not necessarily because look, mean, some of the fastest growing SaaS companies today, you go back and look at their first couple years, and many of them start off as like info products. Exactly what you're doing. Like, I was a betting man, my bet is you're eventually gonna find a software engineer and you're gonna start building like real software, like read your own version of CAD. I don't know. But like, you know, a better version of

08:58these things. And and you'll have a software company with a very high valuation at

Michael Ermann

09:01>> some We'll call it content as a software content as a subscription. So like, CAS.

Nathan Latka

09:07There you go.

Michael Ermann

09:08>> We'll make a new term. I like that. I like that. Or Michael as a service.

Nathan Latka

09:11Mass. There we go.

09:13So this is cool. Okay, got it. So how do you, do you find that people who pay you on average $250 to take the exam, if they pass the exam, do they become your salesperson for the firm they joined?

Michael Ermann

09:23>> That's exactly. The third quarter a year? Yeah, that's exactly what's happened. Until, I guess last month, we really haven't had any marketing spend. It's just been word-of-mouth within a firm. So someone will take the course and they'll let, then they'll, if they pass or even if they don't, they'll let other people know that they work with us, that maybe they ought to take us.

Revenue History: 2021 vs Current ARR

Nathan Latka

09:42Yeah, that's very cool. Give me the backstory here. What year did you sell your first Amber Book course?

Michael Ermann

09:48>> I'm gonna say it's 2015.

Nathan Latka

09:50Okay,

Michael Ermann

09:50>> '20 So we probably started making the content in 2014, and then we spent and and then 2015 is when we when we started moving into actual selling access to the course.

Nathan Latka

10:00Amazing. And last year you did 4.3?

Michael Ermann

10:02>> No, last year we did 3.8. Our ARR right now is 4.3.

Nathan Latka

10:08Got it. So just to be just to make sure, you're taking you're taking whatever your revenue is in the past thirty days, multiplying by 12?

10:16To get run rate?

Michael Ermann

10:17>> Yeah. Yeah. To get run rate.

Nathan Latka

10:18Yeah. Yeah. So 350 360,000 in the past thirty days times 12 is 4,300,000 run rate.

Monthly Revenue and Seasonality

Michael Ermann

10:24>> Yeah, exactly. 363,000 is what we've done in the last thirty days.

Nathan Latka

10:27Is it super seasonal? Do you see a lot of signups in January?

Michael Ermann

10:30>> And we do. That's man, you're good at this. Yeah, we do. We do see a lot of signups in the beginning of January and it's not super seasonal though because it's, you know, on average three months and some people stay for six months and some people stay for one month or whatever, it kind of smooths that out. It'll take a little dip of course in December, but in general,

10:53>> terms of revenue. In terms of new sign ups, definitely spikes. There's like a New Year's resolution season where people say this is the year I want to get licensed.

Nathan Latka

11:02Do you remember? So if you're doing $360,000 in the past thirty days, the same thirty day period one year ago, what did you do?

Michael Ermann

11:08>> 220,000.

Nathan Latka

11:10Oh, wow. So where's the growth coming from? Is it just more students or what?

Growth Rate: 113% Year Over Year

Michael Ermann

11:13>> Actually, that's kind of a weird thing because last year must have been a good January because I, you know, I prepared these numbers. We don't do KPIs and we kind of follow this stuff too carefully, but in preparation for this podcast, I did it. And so we've grown a 113% between, you know, year over year 2022 or 2021 versus 2020. Most of the growth has come well, a lot of it's come in the firms and a

11:37>> lot of it's just come just kind of steady organic. I don't know. I don't even know what to call it. I mean, it's just it just it's I don't know. Lucky.

Nathan Latka

11:45Gosh. This it's not lucky, you know, this because I like pattern recognition is popping out to me. It's like glaring in my head right now. Mean, when you go study the beginning of Qualtrics, which is recently a multibillion dollar exit, obviously, you know, they they did the same thing. They sold a product to BYU students who then when they actually joined the product, they sold it into the firms that they joined after college. And it's how

12:04they grew it to hunt you know, over a $100,000,000 of ARR.

Michael Ermann

12:07>> Wow.

Nathan Latka

12:08So this is not lucky. I mean, maybe you stumbled on it, but like, you're following the No. Don't very successful.

Michael Ermann

12:13>> Yeah. I mean, I don't think the core you know, the the the business case is kinda lucky. The the course itself is not luck. You know, I've been a college professor for twenty one years, and I've, you know, kind of been working on that for a while. I'm really into how people learn and I, you know, I recognize that the content's already out there in the libraries and on your phone. So it's really kind of, you

12:33>> know, much more about curating the content and making it palatable for people.

Nathan Latka

12:37Mhmm. No, I love this. And how many customers are paying today on a monthly plan?

Michael Ermann

12:42>> Oh, wow. I think so last year we had 2,800 individual sign ups and then 2,100 for the year were were individuals that were within firms. So it's 4,900 a year last year. Of course, it keeps growing. So, you know, I'm not quite sure how that's gonna work out right now.

Nathan Latka

13:04Yeah. Yeah. Super interesting. Tell me more about funding. Have you bootstrapped or raised?

Funding: 100% Bootstrapped, Never Raised

Michael Ermann

13:09>> A 100% bootstrapped, never raised.

Nathan Latka

13:10I love that. So like the question I'm going to here is Michael, I'm sure you love teaching, but like, I'm sure Virginia Tech does not pay you $4,000,000 a year. Why are you teaching?

Michael Ermann

13:17>> Yeah, that's a good question. I mean, see myself as that's kind of how I see myself as just, you know, the professor. And I really like engaging students and I'm able to do that with the course itself. You know, I do weekly meetings and we have Zoom calls for like maybe a couple 100 people, two, three hundred people. And then I do weekly one on one meetings with people who are studying for the test. So I'm

Working 8 Hours a Week by Law

Michael Ermann

13:37>> able to do some teaching, but I kinda see myself as as, I don't know, just, I just how I see myself. And the rules for the state of Virginia are pretty strict. We're not allowed to work more than eight hours a week on our own business. So I'm pretty religious. I am very religious about that. And so I've kind of kept this. This is, it's a little different than again, lot of the people that, you always

13:56>> ask people, are you all in? Yeah. You know, when are you gonna go all in? And and I'm not all in. I'm part time, but it's worked out.

Nathan Latka

14:03Well, it's crazy. I mean, we always talk to people come on the show. They go, Nathan, I wanna build passive income. And like you you like and but then you dig and they're actually spending like ninety hours a week building the business. For you, I mean, this is truly really more passive income because you've got only eight hours. You said a week or a month?

Michael Ermann

14:18>> Eight hours a week.

Nathan Latka

14:19Yeah. I mean, you got eight hours a week.

Michael Ermann

14:20>> Right?

Nathan Latka

14:20So you're four hour work week.

14:21It's Michael's eight hour work week.

Michael Ermann

14:22>> You know?

Nathan Latka

14:24Know? That's the next book. Yeah. That's incredible. So so I can tell, I believe from like what you showed me, I remember now when I was in town, you showed me some stuff you're working on. You reinvest a lot of this into very cool sort of architecture related projects.

Michael Ermann

14:37>> Some of it goes into architecture related projects. We've made a course for high school students who are studying for the SAT or the ACT. That's the same idea that basically we kind of start with the idea that everyone's a visual learner. You know, people say, I'm an architect because I'm a visual learner, but I've never met anyone who like looked at a graph and said, can you please put that back in the table format? And so

15:00>> we just kind of start with that proposition. And so we just finished that. And actually I just finished, I just finished, I've been working on the Amber Book for twelve years and I just finished it last month. Like, you know, I always had kind of more stuff on the board to get through. Don't get me wrong, could make another four of these probably. I can make it four times as long easily and I'd enjoy it. But

15:20>> at some point the course gets too long, you know, at some point it's just not an efficient way to study. Yeah. Because we kind of see the core, okay, so our super secret plan is to make better buildings, right? But we don't tell people that because nobody wants to pay to make better buildings. But what we do is we teach to the test. And so it's like if you were to take a college course, but instead

15:43>> of the final exam being about the course, it's like the other way around. The course is all about the final exam. And so at some point we kind of have to stop. So I'm in a pivot point now where I'm trying to figure out what to do. So, this may be something where I bring in an external or promote an internal CEO. It may be something where we sell this to someone with expertise or interest or

16:08>> economies of scale who can engage with marketing and

16:13>> HR and just kind of the business operations of the thing.

16:18>> Or it may be something where I just continue to to run it. It's actually been quite fun.

Nathan Latka

16:23You know, there are plenty of companies I've interviewed that sell tools for architects that are pure SaaS plays. And one thing you can't buy this is attention. And what you've built is attention and a community around an info product. That's a very high quality product. And I could see this selling, you look at comps in the space, right? So, Morning Brew, Hustle, you know, these are communities, but for business purposes, this is a community for a

16:42SaaS company. I think the folks and architects would buy, you know, it'd be very interesting. Is this just how many people, I guess, have you paid at least a dollar over the past sixty days to do something for Amber Book?

Michael Ermann

16:55>> Well, we have 4.3 FTEs and that includes that includes Four point three? Four point three. I just had again, I I didn't know any of these numbers. It's been this has been a this has been a trip just kinda finding out what what our business is doing. We have four point three four point three FTEs and that includes me and and and contractors. And then we have we have three that are on the payroll. Three four

Exploring a Sale or External CEO

Michael Ermann

17:17>> on the payroll.

Nathan Latka

17:18That's so funny. Okay. Very cool. Do you have a price in mind if someone offered you $15,000,000 all cash today? Do you sell?

Michael Ermann

17:25>> Did you say 15 or 15? $1.05. No, no, not for $1.05. Mean, would probably year old million, yes. Yeah, for sure. No, I mean, would be, it would probably be negotiation malpractice to tip my hand on that. But yeah, if there was the right company and we're just right now kind of talking to M and A advisors and starting to pull our stuff together. That's actually why I'm not super comfortable talking about money on a podcast,

90% EBITDA Margins and Future Expansion Ideas

Michael Ermann

17:53>> but that's why I'm doing it is because we're looking for a M and A advisor or a CEO or someone to buy the company. Or like I said, I continue to run it. Our EBITDA margins are 90%. So I can just kind of coast on this if I want to as well. I really enjoy doing it. I just think that it may be that someone else could do it better. You were talking about expanding. I mean,

18:11>> could be that, you know, I can imagine a scenario where because we're trusted, I can imagine a scenario where, you know, we could make a starter kit for people once they get licensed with, you know, with affiliations with an insurance company for for professional liability insurance and general, you know, general general business insurance or lawyers or so I could see someone going down the vertical. I could see someone moving into taking this and and taking the

18:35>> content and either moving it into a space where building building product manufacturers, you know, if you wanna teach people how to install your roof or teach people what's better about your roof or something like that, I could see us moving into that world. And I could see us moving into a world where we kind of take the formula that we've done and start applying it to the, you know, with kind of high quality instruction and frankly,

18:59>> significant investment in the animations. And then taking it to anything where you have a licensure process or licensure exam. So CPA exam, hairdressers exam, stockbrokers exam, etc.

Nathan Latka

19:13Yeah, process. Yeah, 100%. I mean, 16,000 people have enrolled, 150 plus firms and over 3,000 positive reviews. It's a heck of a community that you've built. So it'd be interesting to see what happens next. Anything you want to touch on, Michael, that we skipped over?

Michael Ermann

19:25>> No. Let me see. Let's see.

Nathan Latka

19:28No. I'm so thrilled that I'm reuniting with something related to Blacksburg and architecture. I just I had no idea going in. Now I'm like, oh my gosh, all the memories are flooding back.

Michael Ermann

19:38>> It's a great town. I mean, it's a great town and being a professor is a really great life. And people, people, you know, if you think it's going be great, if you think it sounds like a good thing, it's really a good thing. And just to be able to kind of engage with students frankly, take a, you know, I'll let you in on a secret. The faculty take a lot of pride in the student work. It's

20:00>> almost like, you know, it's our own work, you know? So at least when it's good, when it's bad, we kind of, you know, I think mentally you assign it to the student. But when it's really strong work, we're really excited for you guys and we take a little extra pride in it.

Nathan Latka

20:11Well, I hope you guys realize, like people ask me a ton, they go, Nathan, was studying architecture at Virginia Tech wasted time? And I go, are you kidding me? To build great software, you have to be very empathetic. And one of the things I learned studying architecture at Virginia Tech was empathy. I mean, you've gotta think about so much about a human interacts with bits and atoms. The empathy is such an advantage in software. So I

20:31hope all of you guys take tons of credit for even people that come out of the program that don't build buildings.

Michael Ermann

20:37>> I'll take I'll take credit. I'll take credit for all of it.

Nathan Latka

20:39There you go.

Michael Ermann

20:40>> I'm not shy about that.

20:41>> That's a that's a that's an architecture trade as well. We like to give ourselves awards and we like to take credit for things. So I'll I'll fit that stereotype.

Famous Five: Books, Tools, and Personal Life

Nathan Latka

20:50I love that, Michael. Alright. Let's wrap up here with the famous five. Number one, favorite book.

Michael Ermann

20:55>> Oh, Capital in the twenty first Century.

20:57>> That's a good one.

Nathan Latka

20:58Number two, is there a CEO you're following or studying?

Michael Ermann

21:01>> My mentor here has been Amy Ankram. She's the CEO of a SaaS company here in Blacksburg that does they do lab compliance. They actually just exited to another I Ideagen, I think is the company, but but that's someone they ought to have on the show.

Nathan Latka

21:15Very is that CRC company?

Michael Ermann

21:16>> No. It's not it's actually downtown. It's a SaaS company. They do lab compliance. Compliance in the biological laboratory space.

Nathan Latka

21:25That's very cool. Okay. Number three, favorite online tool for building Amber Book. Do you do anything to manage the course or anything tools?

Michael Ermann

21:31>> Yeah. I mean, you know, I think probably After Effects, that's the Adobe software we use to make the animations, and that would probably be the most important. And we do all the normal SaaS stuff. We have, you know, HubSpot and Zapier and, you know, QuickBooks and Stripe and that kind of thing as well.

Nathan Latka

21:47Number four. How many hours of sleep do you get every night? Six. Yeah. He is not overworked. Only eight hours a week. And what's your situation, Michael? Married?

Michael Ermann

21:55>> Oh, no. I have a whole another job. I'm married.

Nathan Latka

21:57A whole another job.

Michael Ermann

21:58>> I'm still teaching. I'm still teaching the other 32. And I'm yes. I'm married. Yeah. I'm married to actually someone I've known since since we were seventh grade, and I have two kids.

Nathan Latka

22:08Yeah. Two kiddos. And how old are you, Michael?

Michael Ermann

22:11>> I'm 48.

Nathan Latka

22:12Alright. Last question.

Michael Ermann

22:13>> Something you wish you knew when you were 20.

22:17>> Read. I wish I I wish I'd started reading a bit earlier.

Closing Summary and Wrap-Up

Nathan Latka

22:20Guys, For pleasure. Great reading for pleasure, but great great story here. Amber-book.com basically started back in 2014. I would categorize as a community for architects looking to pass an exam to officially become an architect. Michael, professor at Virginia Tech, has effectively built out this beautiful, it's an info product, but it's a beautiful info product. Over 16,000 students have taken it. They did about $220,000 a month in revenue just twelve months ago. The same thirty day period

22:45this year, dollars 360,000 a month, about a $4,300,000 run rate, all bootstrapped, 90% EBITDA margins. He only works on the business eight hours a week. That's by law because he's also a professor at Virginia Tech teaching architecture. I predict big things here, great community focused on architecture content. Does a big firm, a SaaS company acquire them who's also selling to architects? We will see. Michael, thanks for taking us to the top.

Michael Ermann

23:06>> Thank you so much, Nathan.

Nathan Latka

23:09One more thing before you go. We have a brand new show every Thursday at 1PM Central. It's called Shark Tank for SaaS. 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, ARPU CAC, LTV, you name it, they share it and the buyers try and make a deal live. It is fun to watch every Thursday 1PM

23:34Central. 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 SaaS world, whether it's an acquisition, a big

23:56fundraise, 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 SaaS 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

24:18up for that at nathanlatka.com slack. In the meantime, I'm hanging out with you here on YouTube. I'll be in the comments for the next thirty 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

24:37people. We got to push them away. Click the thumbs up below to counter them and know that I appreciate your guys'support. Alright, I'll be in the comments. See you.