How BEE Content Design CEO Massimo Arrigoni grew to $22M revenue and 11.6K customers in 2024.

Introduction hey folks my guest today is massimo ari argani he's building be free dot io he's the ceo of the company uh as a business unit and the company is a business unit of a larger company called growings uh you find them on bloomberg they're focused on democrat democratizing content design they've got a visual builder for email pages and pop-ups available at be free dot io and they're embedded into over 600 plus sas applications including 40 of gartner's quadrant from multi-channel marketing platforms massimo are you ready to take us to the top we're ready yeah right i'm still shocked that guy's creative as you you're still you're still getting everything you want out of working for uh in a in a subsidiary of a publicly traded company but you're still enjoying yourself yeah totally you know it's there's there's pros and cons but but it's it's it's fun yeah all right so what's changed since we last spoke is the playbook still the same again you were really white labeling these sort of page builders for other sas applications it's it's a big space as you know democratizing design you look at the last race that canva did right you know 40x uh their rr i mean the space is just is just exploding and we're playing in the same space focused on designing emails and landing pages now pop-ups too about 50 of b is the embeddable editor so sas companies that embed be in their platform just because it makes sense instead of developing their own and then the other 50 is people it's more like the canva side and people that just come to be free.io and want to design emails and pages faster uh with no friction and so they they sign up um for that interesting um okay so walk me through a little bit of the growth so this is like an is most your revenue coming from white label partners paying you or from direct customers paying you like smaller arbors but higher volume yeah like i said it's it's almost right now it's almost split 50 50 which also makes it difficult to say okay just focus on one of the two right well they're they're growing fast both of them although they are very different so on the embeddable editors side only about 600 customers um monthly are by about 600 dollars and and you go from little startups to large large uh you know sas providers um um so and and there it's um long sales cycle you know etc etc because if they're embedding our software in there so they kick the tires for months uh but once we're in no churn like there's there's basically no churn because you cannot take out uh a visual builder that you've embedded uh right so gross uh customer churn is almost zero and the revenue churn is net revenue return is negative you know big time negative um on the other side the so you're a marketing team or a non-profit that wants to design an email fast for a campaign you go to be free dot io and you sign up and that's it very much a product like growth strategy so there's the the free editor that you don't even have to put in our your email to use it completely free and then you upgrade to be pro when you want more stuff and that's similar to a canva play and so there a lot of users tens of thousands of user users of the very free version and then we convert about nine percent of those into free trials over ten thousand free trials a month and then um you know down from there ten thousand free trials a month that's incredible uh when people convert on the smb thing what's the average rp what's arpu there um it's it's about twenty five dollars and that's higher than i would that's actually i'd say that's pretty strong actually for this kind of product that's hot that's a good price and and it's there too we're very much still in a discovery space uh because we have we just signed a deal unfortunately we can't disclose the company but very large pharmaceutical company that has with the company yeah right uh 1500 people in their company designing emails with this thing it's just basically a matter of people frustrated because they if they don't have a tool like this they have to wait for marketing to get the stuff done and it takes how many are paying for it now Currently serving 11600 customers the just the smb one um about uh 11 000. you have 11 000 people paying 25 bucks a month right and the spectrum again the interesting part of it where there's you see this huge potential and you see why canva did you know that fundraising at that level of of uh multipliers that it's the little guy and it's the huge corporation that says okay this is a lot faster than using agencies or a lot faster just going through the bottleneck of my marketing team right because you might have sales people in 50 countries that just need to update that that sales sheet in the case of canva in our case they need to update that little email uh that needs to go out right and they need to do it now not in three weeks from now so it's a massive space we're super excited i mean so can i add those two things together you've got 11 000 customers at Monthly recurring revenue 25 a month that's 275 000 a month in revenue then 600 white label customers at 600 a month that's 360 000 in mrr for a combined mrr of about what six hundred thirty five thousand dollars so um again we're we're subsidiary of publicly traded companies so the last thing that we disclosed was over 7 million in arr so you're right you're right there yeah yeah i'm right come on i'm right on the you money baby are you are you are so uh so over over 7 million in there are um growing fast and where were you a year ago [Music] a year ago well this year we're growing over 50 percent so you were at like uh five five point five point six million or something about a year ago run rate wise yeah i i yeah fifty percent year over year growth yeah interesting right right um where is most likely coming is it signing up more smb customers or is it expanding revenue on white label accounts both both um white labels accounts so the embeddable editor again their long sale cycle slowed down a little bit during covid where people were just like in wait and see and now we just had a tremendous last couple three four months so a lot of customers now that are saying okay let's go uh and there you're right it's a it's uh people kicking the tires and then growing so the number of new customers that we sign up is smaller but that's also why we were talking to the two of us about disaster that's why we're a sasser next week you know you say hey if you're in the sas space you got to look at this because likely in your sas application people are designing stuff and instead of building your own visual builders embed this and they go yes let me take a look at it it takes a long time for them to do that but then you sign up you know a larger customer yeah so tell me tell me more about like you as a leader right so you're unique in that most my interviewers are like founders that own 89 of the business you i'm assuming do not own 80 to 90 percent of be free i assume you have some sort of equity right but is the equity grant sort of through the parent company or do you actually own a portion of the subsidiary so um yeah without disclosing you know stuff that i can't disclose but uh yeah a a piece of it and really that the one that's publicly traded is the holding company so the the us corporation is just a 100 percent uh you know wholly owned subsidiary and by the way again without disclosing anything that's not publicly traded information the valuation of growings it's publicly traded company in italy the valuation makes no sense what is that it's it's the entire group is if you look at it right now it's valued at around 65 million euros and i just told you that b does 7 million in arr growing at that rate um and b is just a small portion of of the company right so you do the math uh again we're treated on it's public it's public right what's what's revenue what's the revenue multiplier right now on the valuation it's one what yeah makes no sense well is all the other revenue like this really shitty low margin revenue or something not really i mean um again publicly traded information publicly available yeah you can you can look at it but ebitda um was i think 2.5 million in the in the first six months of the year we just put out the h1 uh um report it's just that it's a small stock exchange in in italy uh without that much liquidity so that's yeah but if this was the case massimo anyone listening right now and we have a lot of people listen that are private equity firms growth equity firms there's a lot of buyers that listen to this show they're immediately and they should be thinking why don't i go buy be free out of this subsidiary because if i just re put in the us and put it you know here we're going to get a 5x multiple on a 7.5 run right why i mean i'm have you been approached to do this why haven't you done it yet we get approached daily pretty much uh because the because the parent company has a strong incentive to grow this as a key asset and unlock the potential of the you know of the parent company uh which again right now it's kind of stuck in uh in a situation that's mostly due we believe to the small market that we're traded on in in italy and obviously we're looking at options yeah i was gonna say i mean if the whole business is trading on a 1x multiple and you're doing 7.5 right now yourself if someone came and offered you 2x that so for you know 15 million on cash up front which should be like 2x the current share price shareholders would have to agree to accept that that's like 100 premium on the current price it's uh well and and as you know the multiplier on sas companies like like b is not 2x no it's like it should be like 6 7 6 7 8 x maybe higher right right yeah canva just raised the 40x i mean that's probably nuts but um but that's because the space of democratization of design is a huge space so why aren't you doing this like usually this story you the guy that's stuck inside is going and raising from private equity and you are spinning it out like why aren't you doing that well first of all i'm a product guy i'm not a finance guy who cares that's who should lead the company i i have fun building products and we're having a lot of fun building building our products um and my colleagues are you know worrying about the other stuff and i do believe that we're gonna unlock this thing um pretty soon because it makes no sense so we're where we are right now i think a lot of people simply have not understood what's what what's inside growings um and where we're you know what this company is doing uh we have investors also kind of you know on the other side of the the atlantic that don't necessarily uh deal with sas multipliers every day and so they just look at maybe a beta or you know multipliers only be done that kind of stuff so that's that's part of it but yeah i agree with you again this is all publicly available information nothing nothing uh that's not publicly available guys mainsail i know you're listening level equity i know you're listening sas group i know you're like give this man 14 million bucks and let him spin this company out hello this you're going to like double your money very quick if i had 14 money to do the checkmaster i'd do the deal instantly okay i think yeah i don't think we're interested in in selling at that price because this is a this is a this b has huge huge potential yeah but that's it doesn't matter what you want to sell because if that if they go to a shareholder or vote at a 2x premium current share price it doesn't matter what you think like the shareholders are gonna they're gonna take that premium got it but but well you're talking about the shares of the of the of the publicly traded company though right yes yeah i mean so what what you would actually do is you would invest to take over a poor enough shares of the public traded company to force a spin out of b so you would need you know 20 percent of 65 million right if you want to start guys there you go slowly start buying share prices there you go okay here we go we're a little bit turning up at the gate here on the latka podcast today all right all right yeah anyway that's the strategy right that's what you would do it yeah again we're traded on aim which is uh the smaller stock exchange there's one in london and one in milan because the milan stock exchange used to be owned by the london stock exchange and these smaller um you know stock exchanges uh have less liquidity which in the end that that's at the core of um kind of the the nonsensical valuation we believe yeah i hear you what's a team size today only on b b right now i think we're 53 54 something like that about engineers um product plus dev is about 30 people so very very product focused yeah yeah very heavy interesting any quota carrying sales reps we have uh like now it's two or three that are that are in in that um you know kind of profile what's the quota like a million a year i don't remember honestly i have to uh ask our sales no you're good good stuff man let's uh let's wrap up here with the famous five number one favorite book ah oh man um i just uh read the the hate u give and the other two books that that uh she wrote um very very nice trilogy so i'll go with that that was a that was a good book number two is there a ceo you're following or studying so one of my favorites it's he's not the ceo but best trainer at intercom again i'm a product person and he's a fantastic product strategy person one of my go-to's number three what's your favorite online tool for building a business for building a business um let's see what we use a lot i mean we're using uh we're using the atlassian suite quite a bit so um slack a lot i don't have a very favorite tool to build to build a business though i don't know all right so what's uh married single kids what's your situation i'm married with four kids wow how old are you uh they're they're between 32 oh me um i'm almost 50. five zero okay and uh how many are to sleep to get every night what's that how much sleep i'm trying to get more man um i i think we're i'm between six and seven right now that's not bad that's not bad i can't believe you're 50 dude you have the energy of like you have it like my energy it's great uh what are you wishing when you were 20 um i mean traveling traveling is awesome it's one of the reasons why it's fun to work at a company that's headquartered in italy we just did a team retreat in naples which was fantastic guys there you have it be free they are look at their website builder right their website builder and other like wysiwyg editor tools but then a lot of their com their revenue comes from taking their tech and white leveling it to other providers who then pay them 600 per month on average they have 600 white label partners that's 360 grand in mrr another sm 10 000 smbs paid i'm sorry 11 000 smbs pay them directly 25 bucks a month for a combined mrr of call at 635 000 bucks a month over 7 million they've said this publicly over 7 million bucks in are growing over 50 percent year over year massimo thank you for taking us to the top talk to you soon nathan 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 p.m 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 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 nathan lacka dot 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 counter them and know that i 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