BRITech Global Revenue, Valuation & Funding (2024)

[00:00] Thanks. Thanks for having me. My [00:05] name is Yuryi Ferber. I am CEO and Founder of britech. Britech is a SaaS for investment management. [00:16] So over the next twenty minutes, I'm going to show you how and why you should expand your product from a single to multi product. So I'm gonna talk about value chain adjacency, [00:39] how to do it, if you can build the product, you can buy it, or you can partner now and buy later, and the importance of segmentation into customer support and customer success as well. So this is our this is my company revenue growth over the last five years. And this is happening only because we also have multiple products. [01:12] By the end, I'm going to show the impact in the revenue growth of having multiple products. Of course, [01:26] so important very important when you expand your product road map. To build your next products, of course, you start with one product. When you go to the next product, very important if you stay in the same ideal customer profile because it's it it will be easier to to sell to the same client than to acquire a new client. It's always is. So staying in the same customer ideal customer profile, it will allow you to upsell to [02:02] that customer and also will be cheaper, and you are going to have more retention. Why why you have more retention? Because when you have multiple products, same client using your multiple products, you start locking up your clients. So usually, one product consumes data from another product, and this creates a lockup, and it's great for mitigate your churn. And there are some effects, of course, that I'm going to talk later. [02:46] In our case, we start back in eight years ago, back in with one product for one customer profile. And nowadays, we have, seven products for seven different profiles and serving like 30 different use cases for this customer base. So this is very interesting because it creates a lot of opportunities to monetize your product portfolio. [03:25] Let's jump into Section two. [03:28] There are many ways to build to expand your product portfolio. Of course, you can use the traditional way of building. As probably did in the first product, you have your CTO, you have your team of software engineers, and you just build a new product. Of course, you have to [03:53] pay attention to to things like product market fit, as my my friend earlier in this session just to show you. So product market fit is is one thing that you must worry when you create a new product. You can have a product market fit product, but probably you don't, it's not a, [04:21] you have to, when you create a new product, you have to be worried if you reach the the product market fit for that new product. A second way to to expand your product portfolio is to buy. You can buy another company, or you can buy the intellectual property, or you can the third option, you can partner now and buy later or maybe buy later. So what I mean by that? I mean that if you find another [04:58] company that has another product, not similar, but adjacent to your product and you and something that you can sell to your customer base, maybe you can partner with that company, bring that product to your product, so make it embedded in your product like like a white label, and after some time, you can maybe buy these guys. Okay? So the the advantage of the of doing this way is that you don't need money to acquire these guys [05:36] as as when you you buy the company, you have to, of course, use money, but if you partner now and buy later, you can experiment if that product really has a market fit with your current product portfolio, [05:55] another important thing is the culture. So you are bringing new people to your company. Is there a are you sharing the same values? The product is really selling to your customer base. So after some time, six, twelve, or maybe eighteen months, you can start to realize if it's working or not. And when you [06:22] do stuff like that, partner now and buy later, of course, you have to take care of a lot of different things. First, you have to have it on paper. So and start with start with a partner contract and stuff like revenue sharing, how much are you going to share with the partner, [06:50] what are you going to do, are you going to support the partner product? So your support team is going to support your partner product? Ideally, yes, but sometimes it's not so easy to do that. So as more as you do using your partner product, as more you can retain from the revenue. So you can maybe share 50% or less percent as more as [07:22] you do for the with that product. After some time, as said before, if you six, twelve, or eighteen months or twenty four months, it depends, there's no magic number, After you find out that product from your partner is working, you're really selling it to your customer base, maybe you start to think about how to acquire these guys. So the the acquisition, [07:55] you should have an since day one, a formula to to price that cost of acquisition. So you can buy these guys or even if can [08:08] equity swap. So rather than buying them or buy the IP or buy the IP and the team, you can maybe bring these guys to your company and give your company's equity in exchange of their product. That's the third option. This is, by the way, the way I like more, okay? [08:34] Again, [08:36] talking about yes. So build is the first way. Buy is the second way. In my opinion, the best way is partner now and maybe buy later if it's working. [08:54] Let's jump to Section three. So we are talking now about [09:02] segmentation. Segmentation is very important because, you know, you can have a great product, but if you don't serve your customer base well, you're going to have churn even having a great product. So in my opinion, too, if you are a vertical B2B, you must have segmentation in your customer support and your customer success teams. This is going to so both teams will need to have domain expertise on what you do. So if they talk the same [09:39] language of your client, it's going to create a really a value, and it's going to create a bond, and the churn will be dramatically reduced. So segmentation is very important. And customer success, by the way, customer success for me is they are the guys that upsell. So again, going back to that example, you have a product, you partner with another company to add their product to your offer offering. [10:14] Who does that? In my opinion, the customer success is one that upsell because why is that? Because for me, customer success is like CRM 2.0. So these are the customer relationship managers, very close to the clients, but they need to understand the client business, and so they are talking to the client on a frequent basis, so they will know the best time to upsell or to sell a new product to that same client. And the sales [10:48] teams, they are worried about bringing new clients. So you segment, you leave the sales team acquiring new clients, and you have the customer success team, of course, making sure everything is working and upselling new products to your client base. [11:09] We believe it this is a page from our website. We believe it so much that you can see in our product page this is our products. In our product page, we highlight the our customer success team and our customer support team. So again, you can have a great product, but you need to have customer success and customer support very serving your clients very well and keeping your churn very low. [11:45] So [11:47] I show you these three most important things, I [11:56] expanding your product portfolio from single to multiple products. But let me show you the impact when you have a multiple portfolio in your company, what happens to your growth. [12:12] Again, if you keep your churn low, and what is low? Usually, one digit, so less than 9% per year is a good metric for a low churn, okay? So if you have a low churn and if you have multiple products, you can have a net dollar retention higher than 100%. In our case, we are working in a range between 110% to 120%. And what is the impact of having a high net dollar retention? [12:53] The growth coming from the customer base is huge. If you take a look at, for example, 2019, 27% of the growth came from the customer base. If you take a look at 2020, 30% came from the customer base. And if you take a look at 2021, twothree of the growth came from the customer base, only onethree came from new clients. So this is only possible if you have multiple products and you are constantly frequently upselling to [13:35] your customer base. [13:40] Yes, that's it. I'm open to questions. [13:59] >> Yes. [14:02] >> You. Yeah, our ICP other B2B's, what are your thoughts of targeting the same company but different department within those companies, right? Because right now we serve, let's say the operation department, but maybe we can come up with a product that serve their sales department. So even though it is the same ICP, the same company [14:27] Another department. [14:28] >> But another department, what are your thoughts about that? Or should we like stay within the same department and not go across department? [14:35] Yeah. When I when I when I say ICP, [14:40] it can be a different persona inside the same the same company, but not the same user. So in your case, we have the same situation in our company. First, again, if one department that is your client is saying good things about you, your company, this is gonna help a lot, because the first thing is when the new department will buy a product from you is ask the other department. So again, customer support, customer success, key in [15:15] this moment. So it's not a problem. It's considered the same ICP, another department, so very important. If you have big corporations and you have products to sell for the entire company, this will work. And I don't know how young is your company or but if you have multiple products, you are going to experiment net dollar retentions high levels. Thank you very much, guys.

[00:00] Hey, folks. My guest today is Yuryi Ferber. He's a successful entrepreneur with a twenty year track record, was previously CEO and founder of YMF, a leading financial software company with 300 employees that was later sold to TOTVS. He's a well respected authority in the Brazilian technology sector and is often called upon to advise firms and individuals on IT best practices and solutions. Before founding YMF, Yuryi spent eight years in investment bank Garantia as a trader and [00:25] portfolio manager, now building BRITech Global, a B2B SaaS platform for investment managers. Yuryi, are you ready [00:32] to take us to the top? [00:33] >> Yes, let's do it. [00:35] All right. So what kind of investment managers are paying you? [00:40] >> So we are a provider, a software provider for the investment management players, right? We are not an investment manager as ourselves, but we provide technology for almost all the chains of the investment management ecosystem. [00:59] That makes sense, and give me a sense of what these investment managers are paying you each month to use your software. [01:06] >> Our ACV is, let me give you in dollars, it's currently is like [01:14] >> $28,000 a year. [01:16] Okay, and how many customers are you working with? [01:19] >> Over three fifty. [01:22] Three fifty customers. Okay. Now, and can I take three fifty times 28,000, you're doing about 9,800,000 in ARR? [01:30] >> That's it. [01:32] And where were you about a year ago, just so we can calculate growth? [01:36] >> 70%. 70%. [01:37] So you're doing about 7,000,000 in ARR. Where did most of the growth come from? How are you getting customers? [01:43] >> Yes, we have on average 20% [01:49] >> upsells in the base and the rest comes from new clients. [01:54] Okay, got it. Are you upselling? Is it number of seats, a feature set, a utility based upsell? What is it? [02:01] >> In our SaaS platform, we have over 30 features or 30 use cases. So what we do is constantly sell new use cases. We are not driven by number of users or seats, we are driven by number of use cases and number of portfolios, investment portfolios, our clients control with our technology. [02:28] Okay, that makes sense. Now, do you ever consider, since you are so close to their AUM or their assets under management, would you ever take a percent of the AUM or no? [02:38] >> We [02:42] >> do it, but only for new entrants just to make easier for them to use us. So it's like five bps and because they are new entrants, the AUM is not big. So it allowed them to start using our technology And of course, after time we grow organically with them. [03:07] So Yuryi, you'll let new investment managers avoid paying you a $30,000 a year fee and instead pay 0% of their, 0.05% of their AUM. [03:18] >> Yeah, that's five bps. So 0.05% of a year of their AUM. [03:24] Yep. And how much AUM do these new entrants have on your platform right now? [03:28] >> It's like $1,020,000,000. So in dollars, it's like $2.03, $5,000,000 in AUM, the new entrants only. [03:39] Got it. [03:40] >> Of course. So I told you we have like $28,000 as our ACV on average, but of course we have guys paying us like [03:53] >> what? I have the numbers in Brazilian reais. So [03:58] >> like 5,000 per year up to what? Let me see. [04:08] >> Like to 300,000 per year. [04:11] So your highest ACV account is $300,000 a year? [04:13] >> Yeah, yeah, yeah. [04:14] Okay, got it. And the growth has been great. You're at about a $10,000,000 run rate today, from 7,000,000 about a year ago. And I believe you told me last time in 2018, you finished with about a $5,500,000 run rate, correct? [04:25] >> Yeah, correct. [04:27] Just so people have context, when did you launch? [04:30] >> We started the business in 2014. [04:35] >> '20 the next year, [04:38] >> we started the business with our first acquisition, and the second acquisition came one year later. So the company was bootstrapped with the two acquisitions at that time, and on top of those acquisitions, we grew the company so far. It's like a 20 fold revenue growth in six years. [05:01] How big was the initial acquisition? How much did you have to pay for it? [05:04] >> Very small, like in dollars, it was like [05:09] >> $600,000 both. [05:11] Okay. Where did you get the $600,000 in 2014 to do that acquisition? [05:16] >> The first acquisition, my money. The second, it was a venture capital fund that invested in us back in early twenty fifteen. [05:27] And what was the size of that round, do you remember? [05:29] >> $3,000,000 [05:32] $3,000,000 What valuation did you negotiate? [05:35] >> It's like a six times ARR. [05:38] Which was what back then? [05:41] You know? [05:43] >> I don't know these numbers on my mind, so you can make the calculation, but it was like so just to make easier, they got like 34% of our equity with them. [05:57] Okay, got it. Yeah, so you raised at a 6,000,000 pre money and 9,000,000 post, something like that. [06:02] >> Yeah. [06:03] Okay. And have you raised any capital since then or no? [06:06] >> No, no organic growth since then, six years. But the news is that we are raising a second capitalization round right now. [06:16] How much are you looking to raise? [06:18] >> $50,000,000 five-zero million? [06:21] Yeah. What valuation are you targeting? [06:24] >> We are targeting eight [06:28] >> times ARR. [06:30] So 80,000,000 pre money or post? [06:35] >> Eight times, so it's like 80,000,000 pre money. [06:39] 80,000,000 pre money, which would be 130 post? Yeah. So you'd be selling again about a little more than 30% of the business. [06:48] >> Yeah. [06:48] Okay. How do you think about dilution? Is any of that going be secondary? [06:53] >> No, no secondary. So it's [06:57] >> just for acquisition. So again, we started the company with two acquisitions, six years running organically, and now we restarted the acquisition plan. [07:11] >> By the way, we are running our third acquisition at this moment. We expect to have the closing early October, and we have like three or four more to be done with that money. [07:26] Tell me about the team today. How many people on the team? [07:30] >> Before the third acquisition, we're talking about 120 people. [07:35] How many engineers? [07:38] >> Like [07:40] >> thirty, thirty five engineers. [07:42] Are they all down there near your Brazil office or are they outsourced? [07:47] >> Brazil. [07:48] I see. And any sales reps that carry a quota? [07:51] >> Yeah. So the biggest part of our investment is in growth. So we have like 40% of the revenues being invested in growth. [08:05] How many sales reps do you have on the team that carry a quota? [08:08] >> It's like [08:11] >> around thirty, thirty five sales guys, sales force, including inbound, outbound, marketing, everyone. [08:20] How many total? Sorry. [08:22] >> 35. [08:23] 35. Okay. But of that sales team, how many actually carry a quota that they have to hit? [08:30] >> 20 guys. [08:31] >> 20. Okay. [08:32] What is their quota? A lot of people struggle with launching their sales plans like structure it? [08:38] >> So, [08:42] >> have a combination of [08:45] >> fixed salary plus a very, very aggressive sales commission. So that's how we are growing like 70% a year with that aggressive commission, sales commission. [09:03] What's aggressive? [09:05] >> It [09:07] >> can be like three times their [09:12] >> fixed salary. [09:13] Which is what? [09:15] >> Which is like $2,000 [09:20] >> a month. [09:21] So you pay them $24,000 per year fixed, and then they have to go sell about $60,000, $72,000 of new ARR per year to hit quota? [09:31] >> That's it. So payback is less than eight months. [09:35] If they hit their quota, do you pay them more? What's the commission? [09:39] >> It's just a little bit more. It's like a 20% more. [09:46] >> It's a premium, a 20% premium over the sales commission. [09:50] Got it. So if they hit their target quota of $72,000 of new ARR in a year, in addition to their $24,000 base, you'll pay them an additional 20% or approximately $4,000 So their full on target earnings is about $30,000 [10:07] >> That's it. [10:08] Okay. Is that model working? Can you hire another 20 sales reps on that same quota and keep growing? [10:12] >> It's working. It's working. By the way, we have sales guys everywhere, not only in Brazil. [10:20] Where are they based? [10:22] >> Everywhere. We have sales guys in Brazil, we have in the rest of LATAM, we have in The US, and we have in other countries in Europe. [10:31] How did you convince a US salesperson to work on just a $24,000 fixed It's annual average. [10:36] >> In The US it's different. [10:39] I see, I see. Okay, that makes sense. [10:42] >> This is like the LATAM cost of sales guys. [10:47] Yep. With your $9,000,000 right now in terms of ARR, almost 10,000,000, are you profitable? [10:53] >> Yes, we are profitable since 2018. [10:56] How profitable? [10:59] >> Like 15% EBITDA. [11:03] 15% EBITDA, so you'll take 1,500,000 to the bottom line this year, something like that. [11:09] >> This year we are going to have like, [11:14] >> that's it in dollars. That's it. That's it. [11:16] And so Yuryi, why go sell 30% of your business to raise $50,000,000 if you're profitable? Do you just really want to go do some acquisitions? [11:24] >> Yes, acquisitions. Acquisition is part of our growth strategy from now on. So what is this strategy? Keep growing organically 70% per year and add like 35% inorganic growth. So the idea is to double the business every year from now on. [11:46] And what kinds of companies would you go buy? Would these be like consultants that work with investment firms? [11:52] >> No, we are buying product companies in the same space we are working, but they complement our product portfolio. We don't want to buy more of the same. We are adding other companies that complement and create synergies between the customer basis, cross sell, product cross sell. That's our investment acquisition strategy. [12:19] Okay. And when you look at your net dollar retention annually, what is that at? [12:25] >> Now it's like 128%. [12:28] Okay. 128. And how much of that is churn that you have to make up? [12:34] >> Yeah. [12:35] >> The churn is already in that number, you know. [12:38] Break it down though for me, what is gross churn? [12:41] >> Gross churn is like 4% per year, we retain [12:48] >> 128. So it's like a one hundred thirty two minus four takes us to 128. [12:54] Yep, that makes a lot of sense. Is there room to drive your net dollar retention higher than 128 or do you think you're capped out? [13:01] >> Our goal for this metric is to sustain in hundred thirty. We didn't reach 130 yet, but we believe maybe by the end of the year we can reach 130. [13:16] Yep, I got it. And before we wrap up here, talk to me about your current cap table. How much equity do you still own? [13:22] >> I own like 66%. [13:25] 66%. And then your seed investors from 2015, they own what, 30, 34%. Okay, so it's just you two on the cap table. [13:34] >> 34% is our holding company. I have the majority stake of the holding company, and I have other six or seven executives that run the business with me. They have a minority equity at the holding company. So it's like 80% of the 66 is mine, the rest is distributed with [14:02] >> the executives. [14:03] Got it. So about 12% of BRITech Global is your executives, then about 54% is you and then 34% is your seed. [14:11] >> Yeah. [14:12] I see. Okay. And is everybody on board with taking dilution with this new $50,000,000 raise? And if so, how'd you convince that executive team to take that dilution? [14:25] >> Because they understand the plan, they understand that it makes a lot of sense for us to be diluted. And again, part of the money is debt, not equity. So the dilution is lower than the- [14:42] How much debt will be of the 50,000,000? [14:44] >> It's like 20% debt, 80% equity. [14:49] Got it. So you're gonna have 10,000,000 be debt, 40,000,000 of the equity. [14:55] >> Yeah. [14:56] Do you have a debt partner lined up already or no, you're still looking? [14:59] >> No. Oh yes, we already have a binding offer to a term sheet with a local [15:07] >> venture debt provider here in Brazil. [15:11] Are there warrants included? [15:14] >> No. [15:15] What's the interest rate? [15:17] >> Oh, you are curious. It's a good business. You are going to find out. [15:25] >> It's like 18% a year. [15:29] Holy cow. Why don't you go try to find cheaper capital? I think you can definitely find cheaper than 18%. [15:36] >> Not in Brazil. [15:38] Okay. I'll follow-up with you after this. We'll chat. Have you already signed that term sheet? Is it binding? [15:44] >> I'm about to sign it. [15:45] Okay. Wait. We'll chat right when I finish recording. Yuryi, on that note, let's wrap up with a famous five. Number one, what's your favorite business book? [15:53] >> I have a lot of favorite, but the last book I read and I love it is The Founder's Mentality. [16:01] Number two, is there a CEO you're following or studying? [16:04] >> Not nowadays. [16:06] Number three, what's your favorite online tool for building the business? [16:10] >> Nowadays, I love because I don't have a secretary or assistant, so I love Calendly. [16:19] >> Calendly. [16:20] Number four, how many hours of sleep do get every night? [16:25] >> Seven, eight hours per night. [16:26] And what's your situation? Married, single kids? [16:30] >> Married, three kids. They are not kids anymore, but married, three kids. [16:35] And Yuryi, how old are you? [16:37] >> I'm 57. [16:38] 57, last question. Something you wish you knew when you were 20. [16:43] >> The same question you asked me, I have the same answer. I would love to learn more about SaaS twenty years ago. [16:52] Guys, there you have it, BRITech. Global. They sell SaaS to investment managers. They have just almost 5,000,000,000 in AUM just on early and new funds. Have a lot more than that on their other funds. They work with three fifty fund managers right now. They're about to break $10,000,000 in terms of ARR run rate, up from 7,000,000 just a year ago and up from 5,500,000 back in 2018. They are profitable. They've managed to drive 10,000,000 ARR, raising [17:17] just 3,000,000 on a 6,000,000 pre back in 2015. Now looking at raising 40,000,000 in equity and 10,000,000 in debt at around an $80,000,000 pre money valuation. We'll see what happens. Yuryi, thanks for taking us to the top. [17:28] >> Thank you very much. Thank you, Nathan. [17:32] 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 one [17:57] p. M. Central. Additionally, remember these recorded founder interviews go live. We release them here on YouTube every day at two 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 SaaS world, whether it's [18:18] 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 wanna take this conversation deeper and further, we have by far the largest private Slack community for B2B SaaS founders. You wanna 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 [18:40] saying. Sign up 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, I do it so that we can all learn. We have to counter those [19:00] people. 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.

you're gonna love this interview just got done editing it i'm glad i got it live for you i'll be in the comments for the next 30 minutes hanging out answering any questions you have in fact leave a comment below about data points or what you think is going to happen to the company and i will respond to every comment additionally if you're just loving the content click the thumbs up and i will go and check out your profile as well and give your videos some love as well in the meantime enjoy the interview hello everyone my guest today is yuri ferber he is a successful entrepreneur with a 20 plus year track record uh he previously was ceo and founder of ymf a leading financial software company with 300 employees that was later sold to tot vs now building a company called bree tech url bretek dot global making uh digital simpler for folks yuri are you ready to take to the top let's go nathan and good to talk with you again yeah i'm glad you're able to make time to jump back on for those that missed the first episode tell us quick what does the company do we are in the investment management space so we we we are a sas company we serve the investment management uh ecosystem and they serve the the investors so give me you i mean tell me the story of how a customer that's paying you right now how are they paying you and how do they use you yes our acv is still the the basically the same we are talking about three thousand dollars a month um so our acv is uh very stable and how many customers are you serving now we are we have like 250 customers that's up from 150 uh which is great from about what that would have been almost a year and a half ago so nice growth where is that most that growth come from where are you finding customers oh we have some news from that time at that time we were having customers in brazil mexico and chile now we have customers in eight countries uh last year we started our expansion to to the uh to europe and the u.s markets now when you came on back in 2018 you said that in q1 of 2019 you were going to close up i think you told me a six million dollar raise at a 6x pre-money valuation did that deal happen no because we we uh stopped at that uh that raising process what happened is that we changed our expansion model we created a uh what we we call a distribution franchise model so basically we now have like five franchisees around the world and they are uh allowing us to expand globally without a lot of money from our side so at that time we were raising money to to grow the sales and marketing team and now uh that uh growth is coming from the channels from the franchisees uh that we are uh uh attracting uh around the world and yuri with this model which is new since the last time we spoke what have you been able to grow revenue to today so our revenue like is like nine million dollars if if we keep the same uh currency exchange rate that we use at that time because i don't know if you are following a brazilian exchange rate uh from that time it's like uh almost a 50 percent uh devaluation uh you know in the currency yeah so 250 customers paying three thousand dollars uh an on average per month usd puts you at about 750 000 a month in revenue again usd or about a 9 million dollar run rate uh not thinking about currency exchange issues which for you is a real thing i mean that is a real deal you have to worry about yeah yeah yeah it's it's good and but but again because we are uh uh now we have customers in three different uh currencies we have customers in brazilian realize of course most part of them are out of the 250 2 and 20 are in brazil for the most part still in buzz in brazil yet in brazil but but we have customers in europe and the u.s so we have uh like 90 percent of our clients paying re-eyes and 10 paying euros or dollars us dollars i see and what is so so when you last came on you said you raised about four million dollars total have you raised any additional capital no okay are you raising right now no okay and what's what you look like today how many people we still have the the 20 people uh so basically the interesting this uh channel uh model that we created is that uh it's a win-win partnership and uh the the the channels they are making money and uh we are attracting more channels uh over the years so like i told you we have five channels at this moment brazil rest of latin america us and europe and we expect to by the end of this year we expect to have like two or three more channels so we are expecting to to grow uh three more countries per year in the years to come how many engineers are on the team uh most part of the the the company the 20 uh people are engineers so basically uh 15 16 17 like uh 15 okay and how many quota carrying sales reps uh so again the the sales reps they are in the franchisees okay so you have no quota carrying sales reps on your team we have people that manages the channel so we have someone that do the onboarding process when a new on a new channel comes in we have another guy that looks uh uh it's our we call him our global growth officer and he manages the channels and we have uh staff uh helping these guys to to manage the channels so i would say like 15 guys uh as software engineers and five guys to manage the channels okay so so talk to me about one of these channels can you name one of them that's doing well for you yes so the brazilian uh was a turn into a channel so we have a distribution channel in brazil we have another distribution channel uh taking care of the rest of latin america these guys are based in peru and they are managing clients in mexico chile peru and colombia we have another channel can you keep sorry can you name can you name like what's that website what's that company name uh they use our our our our brand that's the interesting that's why we call a franchisee so they they they sell they implement and they support the clients in their geography in their geography and they use our brand to to uh uh in the front uh to so the other quotations to the clients or the proposals they are all uh protect proposals of course the contract the contract with with the clients it's always a brit tech in brazil and the client wherever the client is but these guys they are uh you know supporting our growth and our uh and our customer success as well when you last came on you said gross revenue churn was about one percent what's it at today today is like five percent per year okay and what's expansion revenue especially like our net retention rate is like 125. okay so you have 30 expansion five percent churn for a total of 125 net revenue retention yes that's pretty good now are you still spending about twenty one thousand dollars to get a new three thousand dollar a month customer yeah of course that cost is in the channel but the channel is keeps uh the the payback for the channel is still uh like six to seven months uh payback so what what is that economic model with the value-added resellers you give them 30 40 50 of the sale on perpetuity or what uh uh like uh 24 percent okay and so if a channel signs up a new 3 000 a month customer uh and that customer pays that for 10 years do you pay 24 every single month to the reseller yeah exactly okay uh if that 3 000 a month customer that the va that the valued reseller signs up pays for the full 36 000 yearly contract up front do you pay them 24 of that immediately we don't like uh pro payments so we really try to make uh monthly payments okay well and why is that most people like upfront payments because it pulls cash forward because we already profitable so we don't need the upfront payments uh and that's it how how how profitable are you like uh 20 ebitda margin okay got it so on 750 000 per month your ticket talking about 15 000 a month oh sorry hundred fifty thousand dollars a month added to your bank account every month yeah what do you do with that money did you just let it sit there and pile up or what so we are using that money to to to expand to attract more channels so of course this this uh this is a a cost for us to to to expand but after we uh find a new uh channel in a specific area uh uh we have the cost to to find these guys we have the cost to train then we have the cost to uh to onboard these guys so uh we are using part of the the the the cash generation to expand in more channels very good all right yuri let's wrap up here with the famous five number one what's your favorite business book i i like to nowadays i i have another famous business book which is the book from simon sinek which is the infinite game number two is there a ceo you're following or studying i really think that uh the the ceo from microsoft this guy is really doing a great job number three how many uh sorry what's your favorite online tool for building your company we use a a a group of of of of technology and so we use hubspot we use a zendesk we also are using nowadays churn zero for customer success management and microsoft planner microsoft things this is most uh most important tools we are using uh in a day day to day number uh four how many hours of sleep are you getting every night uh six seven hours per night and what's your situation married single kids married three kids wow how are you 56 56 uh and last question what do you wish your 20 year old self knew again i would love to know more about sas 20 years ago guys there you have it uh protect global again making investment and wealth management decisions easier they're now doing about nine million dollars a year in terms of run rate they have five percent net revenue or sorry gross revenue churn annually with 25 sorry uh 125 net revenue retention about a seven month payback period but unique model here no quota carrying reps on their team mostly engineers 15 16 engineers they leverage a value-added reseller model where they incentivize resellers under their brand to sell their product uh and then they uh pay a kickback of about 24 to that value out added reseller as they look to scale they're profitable take in about twenty percent deeper to margins to the bottom line every single month in terms of cash flow four million dollars raised yuri thank you for taking us to the top thank you nathan good to see you again you guys know i fight like heck to get these data points for you from these ceos that rarely do these kinds of shows if you want more shows like this make sure you subscribe right now we're trying to get 10 000 youtube subscribers by the end of september here 2019 and it would mean the world to me if you clicked now to subscribe additionally i've got two more great interviews for you if you want more data points from the world's leading sas ceos click and watch one of them right now

Search in video hello everyone my guest today is yuri ferber he's a serial entrepreneur with a 20-year track record and was previously ceo and founder of a company called ymf a leading financial software company with 300 employees that was later sold to a big tech company today he's focused on bra tech down there in sao paulo yuri are you ready to take us to the top let's go nathan all right talk to me about britak what do you guys do and how do you make money okay so uh britak is a wealth tech we serve the investment management ecosystem basically we serve asset managers broker-dealers family offices wealth managers and our mission is to make investment management simpler and faster simpler and faster so i mean do we put you in the category of like wealthfront betterment robinhood uh we uh it's more like adapar okay i'm not familiar with adapar um yeah so we are not we are not uh uh we serve the the financial institutions and they serve the customers the the the investors oh i see so you're like b to b and then whoever you support they then are like a robin or a whale front they'll support the consumer exactly i see okay very good and are you a pure play sas company yes we are okay so without going down every kind of customer cohort give me a general sense what's the company paying for your platform per year per month uh it depends on because we have a platform so depending on how much modules and how many portfolios the company the customer has he pays a different amount so it's a pay-per-use uh sas play uh but on average uh they are paying like three thousand uh dollars per month okay that's helpful to understand and put all this on a timeline for me when you launch a company we started the company in 2012 but we went to the market in 2014 so we spent two two years on the first product and was that you using money from your past sale kind of funding the company or how did you initially fund exactly that's it uh raise the money only in 2015. and how much race today uh we raised like um we raised like uh left maybe let me see in dollars uh four million dollars four million and before you raise that money your yi i'm curious how much of your own money did you put in like um yuri you cut out there about how much did you put in one million dollars one minute okay so someone called that a lot someone called that a little but it sounds like you had an exit and you're able to use some of that money to go into this one was it public your first company you sold it how much did you sell for uh we sold it for like um 25 million dollars okay were you the sole founder yes i'm the i was the founder and i and i and we sold it in 2009. oh that's great that's very good um and it was also a financial play yes yes it's a it was different but in the financial market we were serving the custodians at that time oh interesting okay good all right so launch this company again protect in 2012 you build for two years you go to market in 2014 how many customers do you have now today we now have a 150 customers in brazil mexico and chile interesting why those three geographies so specifically in terms of financial market these are the the brazil is the is the bigger the biggest market but mexico and chile they have also good financial market customers for us okay so if i take 150 customers times that 3 000 price point you gave me that would put you guys what about 450 grand a month right now on revenue yeah exactly and what's growth look like where were you at a year ago we are we are basically doubling every year our arr okay that's pretty good so caught 225 000 about a year ago now 450. yuri where's most that growth coming from expansion revenue or new customers uh no basically new customers but we also have upsell because as i said uh we have a modular platform so we are always trying to sell more modules to the to the base yeah but most part of the the growth is coming from new customers yep and when you look at the cohort that signed up a year ago typically how much are you able to expand them in year two like 110 percent 130 percent uh yeah our our our gross dollar churn is very low so like how low less than one percent oh wow yeah wow that's very low and what's your expansion uh so basically uh like a 90 percent plus 10 percent upsell tell me what you mean you retain 90 no we retain 99 yeah but but uh the uh from from the the the expansion ninety percent is is uh for new customers and ten percent from uh from the old customers oh i see so if we ignore new customers for a second if we just do cohort analysis from a year ago you'll lose one percent revenue you'll expand 10 so net revenue retention is 109. yeah that's pretty healthy now do you employ like a sales team to drive expansion revenue what's your team look like today we we have uh uh uh uh uh resellers in brazil in mexico and chile and in brazil which is the the biggest team we have like uh for in terms of hunters and and and inbound marketing we have a site like six guys six people and what's just your total full-time employees how many folks uh like 20 guys okay 20 and are they all remote as well no no basically most of them of course there's a part uh one guy in mexico another in chile but uh uh most part of the guys are in sao paulo sao paulo very good um and walking and of course from sao paulo we serve the entire country that's pretty good that's a lot i was telling you before the thing there's a lot happening in sao paulo a lot of technology now have you figured out how to handle like boletos and paper payments and things like that uh we are we are trying to to do something like that but for another uh different uh segment not the the the not the brokers and or not the asset managers but for for another kind of uh financial advisor yeah we are still it's still on on a paper plane so so which i'm curious being in brazil what billing system do you use uh basically we send uh like uh we the the guys pay us uh using a transfers wire transfer oh so you don't use you don't use like stripe or any kind of billing system it's just manual invoices yes yes because we talk about 150 customers it's not so much but so we can do it our erp can support and sending voice automatically every month which erp do you use we use a local erp called um called omi omi and it's a good erp for uh sas companies like us uh talk to me about customer acquisition cost yuri what's it paying what are you paying to acquire a new customer fully weighted uh we pay like uh 16 uh uh uh uh like like six times so the payback is uh comes in between six and seven months so you just have to do the math so yeah so seven times three thousand per month you'll spend 21 grand to acquire a customer yeah yeah basically that and where do you spend that is it on your sales team or direct advertising where you spend it uh basically uh a sales team and uh uh like 20 in marketing like google adwords and social networks and linkaging for example and the most of most of the partying in in sales team so so hunters so call it 80 sales team 20 you know direct spend yeah interesting um makes good sense that four million you raised you said was in 2015 um any plans to raise capital right now yes we are planning to to raise capital next year and we expect to raise like six million dollars next year okay raising next week so raising six million caught q1 2019 and what valuation would you love to raise at i i'd like to not mention that number well maybe not maybe don't tell me like what your actual evaluation is but what is evaluation that would make you really happy if you could get it uh the same evaluation that we have uh in the first round so we are talking about uh six times six times er yep six times arr and again if you're doing 450 a month right now that would put you at about a 32 million dollar pre-money valuation that's great so so six into that what that means you're selling what five to ten percent of the company ideally something like that yeah exactly would you ever do venture debt are there venture debt firms in brazil not in brazil it's it's very expensive in brazil do you venture that how like you're talking like 14 15 interest much more than that really it's like it's like a 30 to 25 percent yuri that's so it's impossible that's we're in the wrong business yeah yes i think they are interesting okay good uh that's that's helpful to understand and where will you spend that money uh we are planning to do some acquisitions and uh and the part of the money also to expand our our our sales team because we we we are planning to keep these uh pace of growing for the next three to five years so uh keep the the the the business growing 100 every year we have to expand uh uh our our marketing and sales team yeah so if you i mean you're pretty close to hitting a six million dollar run rate this year then you want to double to 12 and 24 and keep going from there yeah that's it that's very good yuri let's uh let's wrap up here with the famous five number one what's your favorite business book um i love i love a lot of business books but i love this uh this book from john d john doerr which is a measure what matters good one number two is there is there under the radar ceo that you're following in sao paulo under the radar no but uh i i i like the the the ceo from netflix uh reid hastings and uh i think he is doing great great job there in netflix number three what is your favorite online tool online tool uh i have some some to grow the business i i i like i love we use a lot of online online tools like hubspot pipe drive zendesk for the customers uh success team so those three they are great uh tools yeah number four how many hours of sleep to get every night um depends on six seven eight hours okay and what's your situation you're married single kids i'm married with uh three kids three kids wow you're a busy guy and how old are you i'm 55. 55. last question what do you wish your 20 year old self knew i at that age i would love to know of course it was not a a a business model at that time but i'd love to to do to learn more to do to know more about sas companies synthesize business models yeah learn more about sas earlier there you guys have it from bra tech financial company b2b founded 2012 went to market now doing about 450 grand per month in revenue they've raised four million dollars serving 150 clients in the financial space they then use the bride tech technology to sell through directly to consumers and investors they're going 100 year-over-year so healthy growth rate there again customers paying about three grand per month less than one percent gross revenue churn per year 10 expansion so net expansion there our net revenue retention is about 109 really healthy economics in terms of payback are about seven months so willing to spend 21 grand to acquire a 3 000 a month customer team of 20 people in brazil and other remote locations yuri thank you for taking us to the top thank you nathan