Binderr Revenue & Funding (2024)

[00:00] As binderr.com with two R's on the end does $500 per customer per month today, they have six customers. So 3,000 in monthly recurring revenue. Jacob has invested so far over $2,000,000 of his own money in the business, mainly to pay for the team. There's 18 full time he's burning called a $100,000 per month, but has a lot of conviction on the vision of what he's trying to build. He got that money by the way from his [00:22] first exit. Now plowing it into binderr, which is helping folks that serve it, accountants, lawyers, CSPs and Malta help them service their customers faster in a more automated fashion. They're launching now looking to scale up their customer base, scale up the team and obviously scale revenue. We'll see what happens next. Hey folks, my guest today is Jacob Appel. He loves building companies, had a nice exit from Bolt in 2023 and is now building his life's work [00:48] with company called binderr.com, which helps you automate the workflow of CSPs. All right, Jacob, ready to take us to the top? [00:57] >> Let's do it Nathan. [00:58] Real quick, what's a CSP? Is it customer service professional? [01:03] >> Corporate service provider. [01:05] Corporate service provider. Okay. Was a [01:06] >> bit off. So that would usually be like a accountant lawyer. [01:11] Yep. Now before we before we jump into that world, automate workflows of accountants and lawyers, you mentioned the 8 figure exit from Bolt. Were you a Founder of Bolt? [01:21] >> No. I owned the franchise in a in a few countries down in the Mediterranean and Mhmm. Exited that last year. [01:31] What was the what was the URL of that company? Bolt.com?.eu. Bolt.eu. [01:40] >> It's a large [01:44] >> ride hailing and food delivery company in Europe. [01:47] And so what do you mean you owned the you weren't you weren't necessarily a cofounder, but you bought the trademark rights in certain countries? Or what do mean by you were the franchise owner? [01:57] >> Yeah. We basically had the right to operate that company on in a number of countries. So it was it was our own setup. It was our own company, and we just had to we were piggybacking their technology. [02:10] Okay. And so when they exited, I mean, I think from January, in 01/11/2022, Bolt was valued at something like $8,400,000,000 So I guess, I ping the founders of Bolt, will they know you? Will they know? Oh yeah, I know Jacob. [02:27] >> Yeah. They'll know who I am. Yes. [02:30] Okay. So so how how should my audience think about your slice of the $8,400,000,000 valuation from last year? [02:40] >> As fairly minimal, I would say. We I was running three fairly small countries, Cyprus, Malta, and Tunisia, and it was it was bought themselves that acquired our business back. So we had I me and my partners, we had the franchise right to operate in a number of countries. And I guess at some point when we started making too much money, they they wanted to buy the the operations, and there was like a predefined buyout clause in [03:12] >> the contract we had with them. [03:13] And what is that buyout clause? It says something like, hey. We have the right to buy you out at one x revenue or something like that? [03:21] >> Yeah. I I can't disclose the the exact figures because I think we're still under the the confidentiality of the of of the exit. But, yeah, there was a predefined buyout clause in the in the contract we had with them. [03:37] Were you able to grow your three locations to above $1,000,000 a year in revenue? [03:46] >> Yes. [03:47] Okay. And Significantly. [03:51] >> Okay. More than 10,000,000? [03:57] >> I'm not I'm not because we we're still, like, the the whole we are still waiting to get paid for some of the of of of that exit. So I don't know how close I can get to the figures. Above 1,000,000 is definitely not saying too much. I don't know how much closer I can get than that. [04:15] Okay. What percent of the deal price was not cash upfront? It sounds like you're on an earn out right now or something like that. Are you still waiting on 20% of the deal price, 50%? By far, the [04:26] >> majority was was was paid right away, and then there was, like, a a percentage allocated to make sure that the the the whole operation that they were taking over was running smoothly. [04:39] Oh, 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 [05:03] your 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 [05:27] get 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 [05:49] not built off random data. Again, you guys hear these interviews on YouTube. All these datas are built from real time valuation data points founder 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 [06:14] going out right now and you're raising your seed round. We'll 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. All right. We're gonna go back to the YouTube video here in a second, but [06:36] if you 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 [07:03] the interview. Alright. Let's jump into binderr. So when did you write the first line of code for binderr? [07:09] >> Three and a half years ago. [07:11] So were you running this while you were also doing the Bolt franchises? [07:16] >> Yes. [07:17] I see. [07:17] >> Very [07:18] >> interesting. At some point I knew at some point that our Bolt venture would come to an end and I wanted although that Bolt was a was a fantastic success for us, it was never really ours. It was we were just a partner, and I really wanted us to to sort of control our own destiny and and and build our own thing. So as soon as I realized that at at some point, the the journey would come [07:48] >> to an end, we we we started our own thing. [07:51] Okay. So you started writing code for this in somewhere around 2020. Help me understand today, how is a lawyer or an accountant using your platform to grow their business? [08:04] >> So we we've only just launched the platform to the market. We spent two years actually building an accounting app to then realize that maybe there was a better opportunity in specifically focusing on this niche when it comes to corporate service providers. So [08:23] are you pre revenue today or do you have paying customers? [08:27] >> We have paying customers today, but we are early in our revenue journey. [08:32] So when did you get your first paying customer? [08:36] >> In March. [08:38] March this year. Okay. That's great. How did you decide? A lot of founders when they launch and get the first customer, they're not quite sure what pricing model to use. What did you price your software at? [08:49] >> We went with a model where we felt there was a good opportunity learning from big players like Stripe and other companies that really have become so successful, because they became part of the journey of the customer that they're serving, so they would grow their business on a basis of a percentage of what was coming through. We felt fairly early on, these lawyers, these accountants who are incorporating companies, and who are doing corporate filings, that we want [09:21] >> to be really aligned with their revenue stream. So we charge mostly at transactional costs. So every time you go and incorporate a company through binderr or you appoint a new director, then we charge a fee for that transaction, while we also charge a small subscription per client that they manage. [09:44] What transaction is associated with the company when they, you know, for example, add a new director? Are you trying to say you you charge on a utility based model where every time they take an action, you charge, like, per that action, or is there actual, like, you're charging a percent of GMV? [09:58] >> No. So imagine if you want to appoint a new director in Nathan's company, you would go to your service provider and you would say, I would like to appoint this director. They would charge you $300 to appoint a new director. [10:15] >> Service provider would appoint that new director because it's automated through binder, and we charge them a percentage of that. So we would charge them like $30 to appoint a new director through binder because the whole flow is automated. [10:28] I guess, so on average, what's the customer paying you per month sorta today? [10:35] >> Today, they're paying us about €500 a month. [10:38] Okay. So this is for like a lawyer or an accountant that that that maybe has, you know, five to 10 customers, something like that. [10:47] >> Our customers on average have two to 300 clients that they're serving. [10:52] Okay. [10:53] >> And the reason why we are only at €500 on average per customer is that a lot of the features and a lot of our penetration into the service provider is not deep enough, So we would expect our average customer to pay us 2 to €3,000 a month when we get deep enough with our penetration. But today, as we're still fairly early, it's about €500. [11:18] And how many customers are paying today? [11:22] >> Six. [11:23] And how are you finding them? Are you using a specific growth method? [11:28] >> No. So the the sales part of it is fairly straightforward because in a country like Malta where we operate today, there's a list of all corporate service provider in Malta. Have it's a regulated entity, so you just go online, you find all the the corporate service providers in Malta, and you pretty much have their contact details. [11:50] So you're only selling to accounts and lawyers in Malta? [11:54] >> Yeah. [11:55] And is it is it mainly accountants and lawyers or are there other professions you're working with? [12:01] >> No, our ideal customer is corporate service providers, but they often, like if you look at it globally, they are often comprised of accountants, lawyers, notaries. It really depends on what country you're looking at. [12:14] I see. Talk to me about your founding team. Did you found this one by yourself or you have co founders? [12:21] >> I I started out by myself fairly early on, and then I got I got two co founders later in the journey when we pivoted from an accounting app to being focused on corporate service providers. [12:36] So did you did you give them 50% each, so 25 and then you keep 50% or how'd you guys have the equity conversation? [12:44] >> No. Since I had I financed most of the business myself from the beginning, and as I was also the only founder who worked on it from the beginning, it was it wasn't exactly like, let's split it down the middle and we all share equally. Own a larger percentage than my [13:05] So you own more than maybe 70% of the company? [13:10] >> No, less. [13:11] Okay. So between 50 Okay. Oh, but you own about 50% of the company total? [13:18] >> Yes. [13:19] Oh, I see. [13:20] >> Yes. [13:21] So if you own 50, then they own 25% each? [13:28] >> No. Our team owns about 10%. [13:31] Okay. [13:31] >> My co founders own about 15%, and then I have my old partners from the other business that we exited, who also put some of their money into to binder. So they also own a piece. [13:44] Okay. So that's 50%, sixty, seventy five. So they own your old partners own maybe 25%, something like that. They were your angel investors, basically. [13:53] >> Yeah. [13:54] I see. I see. How much of your own money have you put in the company so far? [13:59] >> About 2,000,000. [14:00] Does that make you nervous? It's a lot of money. [14:05] >> No. I I feel fairly confident in in what we're doing, and I don't I I always knew that I wanted to to pour whatever money we made from the first venture into to to the next one. So no. Mhmm. [14:23] Why is it so expensive to build this? I mean, $2,000,000 is have you already spent all the $2,000,000? [14:31] >> Keep in mind, we we spent about two years to begin with developing an accounting app to then pivot for a year and a half to develop this app for corporate service providers, and we're spending about a €100,000 a month. It's a team of 18, mainly developers. So yeah, that runs up over time. Mhmm. [14:58] So you've already spent $2,000,000 because of that burn rate you just articulated? [15:03] >> Yes. Slightly more. 2 and a half, 2.7. [15:08] I guess so. I mean, anyone listening right now might go, oh my gosh. Like I could never afford to spend $2,700,000 like on my startup because maybe they don't have an exit like you. So I guess how do you keep yourself sort of honest? You have enough play money where you can sort of throw money at problems, but how do you make a decision on, man, this isn't growing as fast as I thought it would. We're [15:25] three years in, I gotta shut this down and move on. You know, do you gauge success? [15:31] >> You have to [15:34] >> you have to feel very confident in in the in the direction that that you're taking the business, and I think that the [15:45] >> we didn't it's not like we are inventing [15:52] >> product where we don't really know if there's a market for it, it's kind of like if you can build a better accounting app than Xero or QuickBooks, you know there's a market for it. It's not really a question of whether there's a market and a demand for it, it's just a question can you actually build it, and then find a way to distribute this product, and we've spoken to these corporate service providers all around the world, [16:19] >> and they are all desperate for the kind of tool that we have built, and I know as soon as this product is ready, which it is fairly soon, so for us it's a very exciting time, because we feel like we're right on the cusp of being able to deliver this product that we've worked on for so long. [16:39] >> That makes it a bit easier knowing that you're getting such good feedback from the market, and you, [16:46] >> yeah, you feel like you're close and you also feel like there's a lot of support from your from my partners, co founders, team and and so forth, of course, makes it a lot easier. [16:56] Well, Jacob, rooting for you on that note though, let's wrap up here with the famous five. Number one, your favorite book? [17:06] >> I recently read a book by the I don't know if he wrote it himself, but he is the founder of Hyundai, the the car company. His name is Chong Kyung Jung or something similar, and he's just an absolute he's definitely an inspiration. [17:29] Great. Number two, is there a CEO you're following or studying? [17:36] >> No. Number three, what's Not anything. I I try and get as much inspiration as as I can from from from any any founder CEO. [17:44] Num number three is what's your favorite online tool for building binderr? [17:50] >> ClickUp. [17:51] Number four, how many hours [17:52] >> of send [17:52] do you get every night? [17:55] >> Eight hours. [17:56] And what's the situation? Married, single, kids? [18:00] >> I have fiance, two kids. [18:02] That's great. And how [18:03] >> old are and five months. [18:04] How old are you, Jacob? [18:07] >> I am 36. [18:09] Last question. What's something you wish you knew when you were 20? [18:19] >> I wish I'd put a bit more urgency to this whole journey we are on. There's so much [18:28] >> good stuff to come from being consistent and having a like a long term term vision. So I wish I had started this journey a bit earlier because it really it compounds these these things that you're you're doing. So I wish I had started a bit earlier and known that some urgency would have been good as well. Probably the thing I should know, I wish I knew more better today as well. [18:52] Guys, binderr.com with two r's on the end does $500 per customer per month today. They have six customers. So 3,000 in monthly recurring revenue. Jacob has invested so far over $2,000,000 of his own money in the business, mainly to pay for the team. There's 18 full time. He's burning called a $100,000 per month, but has a lot of conviction on the vision of what he's trying to build. He got that money by the way from his [19:14] first exit. Now plowing it into binderr, which is helping folks that serve it, accountants, lawyers, CSPs and Malta help them service their customers faster in a more automated fashion. They're launching now looking to scale up their customer base, scale up the team and obviously scale revenue. We'll see what happens next. Jacob, thanks for taking us to the top. [19:34] >> Awesome. Thanks Nathan. Take care. [19:37] One 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 [20:02] Central. Additionally, remember these recorded Founder interviews go live. We release them here on YouTube every day at 2PM Central. 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