How Barcart CEO Adi Pal grew to $1M revenue and 114 customers in 2023.

hey folks my guest today is adi paul he's building a tool called getbarcart.com it's an e-commerce tool for alcohol companies adi are you ready to take it to the top yes there yeah all right so why is this needed why can't alcohol companies use regular ecommerce tools it's the law um alcohol producers aren't allowed to sell directly to customers so that's why when you want to buy a johnny walker blue label you are you know buying it from a retailer retailers pretty much across the country are the only ones licensed to sell alcohol and that's why grizzly exists okay and walk me through i love drizzly we just closed a big deal at founder athlete we secured a lot of capital for our warehouse facility and a celebration in the real world they were asking for my address i'm going why do you want my address i was in the middle of nowhere and we're going to ship you a bottle of nice champagne and sure enough they use drizzly to do it and sure enough you delivered it right on time which was very impressive yeah so yeah you should use us next time but actually that's a good example of to walk you through this whole thing assuming those people wanted to send you a really nice champagne right that they went to the brand's website and tried to do that they wouldn't be able to do that without a software like ours because the champagne company makes the product they sell it to a wholesaler that then sells it to a retailer and the retailer is the one that sells it to you so when you order on drizzly it's the retailer delivering it to you or shipping it to you what we've done is we've essentially taken that whole you know work that whole fulfillment network of uh retailers we've got our own fulfillment network of retailers and it's the whole drizzly fulfillment model just plugged into a brand's website all hidden behind one buy button yeah so think of it as shopify buy button meets grizzly fulfillment how do you how do you bill for this what's the average customer paying you per month so we have two customers we're almost we're a sas enable marketplace in a sense right so we've got the brands that are paying us 199 or 299 a month depending on which plan they're on and then uh we once they're selling on their website using our button we have a take rate off of each transaction and that's an average of 10 uh with the average order being 100 bucks 110 bucks yeah yeah yeah and so last month how many total orders uh volume-wise did you process through your system last month uh revenue-wise we were at a a little over a mill um so yeah with the average order being uh hundred bucks you know uh 10 000 orders yeah okay 10k orders last month and your take rate on that is 10 so your revenue on the percent of gmb was about 100 grand last month yep okay and then talk to me about the brands how many brands are paying for the platform we have a little over 150 brands right now i think 155 so and uh not all of them are you know paying some of these guys got on early so we got our first paying customer i just checked uh june of 2020 which is very recent uh i was you know thinking it was november of 2019 but june of 2020 we got our first paying customer and now it's 150 something yep and how many excuses excuse me again um so how many customers are actually paying they're not one of your early beta customers they're real paying yeah so 114 out of okay yeah 114. now can i take that 114 times the 200 to 300 price point that revenue model is about 30 000 a month yeah so that is correct that's our mmr right on just a sas piece and then the average customer is bringing about 10k 11k a month in sales gmb and that's that's so definitely i mean if you do the math obviously our big revenue driver is the gmb right and there's a it's it's not a recurring revenue but there is a recurrence to it uh and the average right now works out to 10k and that's what we're trying to bump up working with the brands this is a very interesting thing i mean you look at snowflake which just ipo'd you would argue they're not i would argue they're not a sas model they're a usage-based model your percent of gmb model is effectively a usage based model now you're not selling data space it's that you're selling you know alcohol but you know would you ever move to a model where you're purely present to gmv no sass fee at all very very tempting because obviously it allows us to cast a much wider net and yes something we would definitely consider um right now honestly it's growing so fast uh that again for transparency we're just trying to you know make sure that we don't collapse under the weight of the new customers we take on because we that's why we keep customers most of our customers don't have contracts except some of the large ones and we haven't lost we've lost one customer so far and it just wasn't a good fit yeah 200 like 1.6 um on a revenue basis per month uh it's uh on a yeah well on a revenue basis yeah yeah so there's downgrading happening as well um and uh so so the other piece that you said earlier that gummy you know you're saying we don't sell data so there's also that piece one of our plans actually shares customer purchase data um insights with our brands to then help refine their digital marketing and increase their roi on on you know their ad spend right automatically put look-alike audience together on facebook things like that yeah okay this this makes a ton of sense give me the back story here when did you launch well bark art was uh has only been around since uh october 2019-ish but as a company you know we started seven years ago as an online retailer for craft spirits we thought we're gonna run a nice curated website with our selections but then kind of like shopify right they started off selling surfboards or something like that and we realized that what we're trying to do there's no platform that exists for that and drizzly was starting off at that time but they were doing delivery we essentially over those years built out a network like grizzly to just be able to sell online on mash and grape which is our marketplace so that started seven years ago but everything we you know we built we packaged it together into what is now bar cart so we've solved our own problem and then packaged it and sold it to customers let me ask a better question here this will really capture the change from selling your own alcohol to a technology company when did you hire your first engineer do you remember oh yeah that's a good one uh 20 uh 19 may okay and how many total team on the team today eleven eleven engineers three okay and who are there what do the rest do uh ops customer support and you know janitors like us yeah and what how is it just you or what's the founding team look like well my wife and i started the company seven years ago so she handles the marketplace side the matching grape site which still you know is that curated marketplace and operates you know a traditional marketplace but uh curated for a per hour taste and then i handled marco 2014 uh no we were married in 2000 and i better get this right eight okay yeah but you were married and then you founded the company and now you're growing and you're still married so that's a good sign yeah oh yeah um i mean if we make it through this you know we can make it through anything yeah did you bootstrap or did you raise bootstrap yeah even today you're still bootstrapped we are yeah that's great that's really great nice work so you and your wife what you guys own the whole company together 100 that's right yeah yeah does she own more do you own more uh so on paper it's me but you know uh really it's 50 50. yeah very cool yeah okay you just hit that up that way yeah yeah yeah this is great i'm gonna get so much trouble making yeah uh no this is cool there this is i love when i get like a husband wife team especially one that's pivoted sort of like this this is great um what's the next step here i mean do you go out and raise do you stay bootstrapped and go after or you know if you want to go after drizzle you got to go raise right you got to go grow faster yeah um i think that that raised conversations now beginning to happen we've had some you know people reach out honestly we hadn't given it thought till i had those conversations with you know some of the people who reached out and there's a lot of opportunity right now and for the first time in seven years obviously we're feeling the constraints um because there's so much room for growth but we need people to support it we need you know sales people outside of it we need ops people right and then uh more engineers all the damn time yeah yeah so what is growth like if you're at 130 grand a month today where were you a year ago uh so we're two and a half times a year ago on an average yeah okay got it so you're doing like 40 for 50 000 a year ago something like that yep sounds about right yeah and that's on the yeah that's on 2019. obviously the pandemic happened and that see that was a inflection point right because e-commerce for producers did not exist in the way it does today everybody had a website but they had no way to buy from that website the only thing that existed was you know a winery shipping you wine from the winery itself uh but today you go to a brand's website that's using us you're having a traditional shopify like ecommerce experience but behind the scenes it's moving through either being fulfilled by the retailers in our network or being fulfilled by the distillery themselves because we also support dtc um so it's a hybrid fulfillment model and with delivery and shipping uh across both retailer and supplier that's something that did not exist prior to last year honestly yeah and are you guys profitable yeah how much well everything goes back into the company but i i don't have our net profit margin um honestly yeah got it but so you know basically you make money you put back in the company you're basically operating at break even because we're like all right now we've got money we can hire somebody else yeah yeah that makes a lot of sense now if you do go raise how much would you raise that's i again i don't know how to answer that because uh frankly i have never raised for a venture i had another you know small venture before this so i need to understand that a little bit better on on what how that works and dilution and what are you getting is it just better to take on uh debt instead of equity again um because debt is easy to come by right now um obviously but that's smaller so i wish i had a number for you if drizzly offered you five million all cash up front today to buy the business do you sell not five yeah there's a number obviously there are there's always a number but it's not five yeah um definitely well i i mean how do you know i guess questions i know i'm gonna wait i'll be waiting for that i uh you know we're we're doing somewhere around this year is going to be around 15 million gmb right across the whole thing and uh i know there's some peers out there that went for a multiple of revenue so it's it's it's it's going to be off of the revenue i feel is what what the market's uh telling us so it's not five that's a practical gmv multiple is very different than your actual revenue multiple which is your take rate on the gmv i mean i've seen gm mark sasebo marketplaces trade at one to two x gmb multiple uh a recent example that is divi to build where they are processing you know several billion in gmb via their credit card they sell uh i think your multiple is gonna be probably closer like five to seven x of your take rate right so plus your sas revenue so above 1.5 times 5 to 7 you start to get into the you know 10 million dollar range and again those are so that's so that's a great point right i don't know enough about what our valuation should be and that's something i need to educate myself on but honestly right now the growth is happening at such a fast pace that to sell right now would be shortchanging ourselves oh yeah yeah but let's get down to like what really matters in a sale though would your wife would she kill you if you turn down a six million dollar seven million all cash up front offer that number yes yeah we we have talked about that that is too small but also because we're on the verge of a potential contract you know i i'm comfortable saying this that would increase our customer base over 200 right so if that's a month away you know that how do you how do you it's just it's too easy to keep building this yeah honestly again i'm not pushing for a raise i'm just kidding i get it it's not sick i know that because i don't need to yeah to be very honest yeah we love bootstrap companies that go to four five million bucks in revenue you build a big beautiful healthy you know family life together it makes a lot of sense uh we're out of time here let's wrap up with the famous five number one favorite book ooh uh kill a mockingbird yeah number two is there a ceo you're following elon musk just saved up a mind right now number three what's your favorite online tool for building barcart what are we using uh let's see i mean everything's homegrown so just technologies we're you know python django show okay great number four how many hours you're sleeping every night how many what hours do i sleep every night um aspirationally eight six though still you know and situation we know you're married any kids one yeah and how old are you four-year-old i am 39 yes 39 last question something you wishing you when you were 20 oh quit your job and just do something you know take the risk take the chance i took a long time to do that guys husband wife team get bar cart was launched in 2014 selling their own alcohol they realized you know what we need to build a tech company here to make this easier or hire their first engineer in 2019 uh scaled up to about 50 000 a month in revenue last year now doing 130 000 per month in revenue two revenue lines a percentage gmv 10 they did about a million dollars in orders last month alone so 100k per month there on the gmb site another 30 000 a month and just pure sas revenue 114 customers paying about 200 per month healthy growth they've done this all bootstrapped which we love with their team of 11. adi thank you for taking us to the top yeah thank you that was a great recap yeah one more thing before you go we have a brand new show every thursday at 1 pm 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 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 1 pm central additionally remember these recorded founder interviews go live we release them here on youtube every day at 2 p.m central to make sure you don't miss any of that make sure you click the subscribe 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