How Burrow CEO Paulo Arruda grew to $850.1K revenue and 100 customers in 2024.

hello everybody my guest is paulo aruda he founded a company called bro dot io which essentially easy tunnels to local hosts his background he's a devops engineer and the author of fast ruby.io and again the current company bro dot io paulo are you ready to take us to the top yep all right man what's the company do and what's the revenue model how do you guys make money so uh basically we provide uh on-demand tunnels uh so developers can share uh whatever they're running on their localhost uh we make money by charging them a fixed amount of dollars a month we charge them five bucks a month to have five tunnels that they can open uh on any machine and who is that you're charging the developer directly yeah we charge the developers directly okay and uh and is it is the average one paying five bucks a month or do you upsell or charge more in certain cases so the average one is paying five bucks a month but i've had some people that asked to um you know increase the the amount of tunnels because i put a limit five tunnels per account just for the sake of you know bandwidth and resources but uh i've had some people approach me saying that they want to start a project with uh iot devices um and they need way more than five tonnes so yeah i i up there of the limit what's your story man put this on a timeline for me when you launch the company there was back in 2014 i was working for a startup and uh i needed to share the work that i was doing with another co-worker and i looked at the solutions that existed uh the popular one was called ngrok uh which is a pretty good solution but it didn't really work for me i must have done something wrong but then i was just curious you know how i would build my own so i decided to build one um but build i built a ui for it basically um so it was we liked it so much at a startup that i decided to put that online and see if people would pay for it and they started to pay i love that and how many customers have you scaled to today so i have an average of 100 customers uh the churn is pretty high but how high the acquisition is pretty high i i have like i don't know the number correctly but it's probably around like 15 20 but i i always have because people only use it for a month and then they get out sorry sorry 15 monthly churn or annual turn monthly okay got it yeah a lot of people stop using and then they come back using again so um so why would someone start using it and then stop using it a lot of the users are freelance so they're working on a show uh to their customers for example like say your freelancer you're developing a a mobile app then you build a little api on your localhost and then you use borrow to share it and then you you give the like a development version of the mobile app to your customer and then you get the customer who access your localhost the api and your localhost to this tunnel so once the project is done they just cancel it because they don't need to use it anymore until they get the next assignment or yeah so there's that happening so you've got about 100 customers paying five bucks a month so about 500 bucks a month right now in revenue yeah yeah is this just you or do you have a team it's just me yeah this is really yeah that was really a side project uh you know uh and then the curious thing about this is that it has like almost no maintenance it cost me 15 bucks a month to run and i don't really do much uh but uh right now i'm seeing like a little surgeon growth so i have to pay a little more attention to it to be honest but why are you seeing a surge well it always started with the beginning of this year no sorry the mid mid last year uh apparently some some people from the other side of the planet found that they could use barrel to uh do phishing attacks or hack android phones so a lot of videos started to pop on on youtube you know in languages that i don't understand and then all of a sudden i had a surge in access and you know 3 000 accounts got created it was just crazy stuff like overnight um and then you know after a lot of uh researching i found that not just that but a lot of hackers were starting to use the service abusing the service to to propagate malware so since then i've been fighting it really hard but uh there's one interesting story about this is uh i was giving everyone seven day trial you know and the the hackers were abusing that period but then once i uh i i put it down to one day trial then a lot of people started to pay yeah apparently a lot of people are using it just for the free tier but so there's basically by saying hey if you use this longer than a day you have to start paying versus if you if you use more than seven days a lot of people weren't exactly yeah yeah yeah but that was an intentional trick yeah yeah but why do you want hackers paying you i mean you shouldn't have these people on your platform anymore no no no no it's it's not hackers paying me it's just legit users i'm just saying that a lot of legit users uh because i i shrinked it from seven to one day is to try to stop the hackers then the legit users started to sign up for the service and pay too because they couldn't use it for free for seven days anymore because i noticed a lot a lot of people just created accounts with fake emails you know just to keep using it too yeah so it was a constant uh battle uh you know against that and basically but yeah i'm still fighting them so i still get emails sometimes and uh if you try to use boro in some corporate firewalls it's it's blocked by default because of that but so is the company growing or has it been basically flat over the past couple years you're doing 500 bucks a month for the past couple years no it it last year i was making around like 200 bucks a month uh so it has grown yeah but i would say if there's a lot more room to grow it's just because i haven't been uh doing much well so have you bootstrapped this or raised capital i bootstrapped it okay i told you it cost me 15 bucks a month to run it yeah so so how are you paying your bills right now are you have a full-time job or what i have a full-time job it pays for itself um but no but i'm talking you as a human being oh yeah yeah okay yeah no i have a full-time job yeah so so why not why not take some risk and quit the job and go all in and try and grow this that's what i want to do but uh you know i mean i can't it's harder for me now because you know two kids and some bills to pay um wife is not working now so uh yeah it has to be calculated at risk i can't just drop it all but i'm slowly trying to make that amuse so see what happens yo i mean why can't you keep hustling in you know when you're not working full-time like you know afternoons and weekends to try and get this up to the point where there's several hundred people paying maybe increased price but really figure out how to decrease churn yeah well yeah scope of the call is fast ruby but that's where i'm putting a lot of my uh my sorry you cut out where are you putting your free time um fast ruby the other project that i'm working on so that's that's what i've been doing why why'd you decide to put time into that one instead of bro because it because it's big it's bigger it has a way bigger potential and boro it's been pretty stable you know like it's a hands-off 500 bucks a month uh whereas i'm funneling that money that money actually too fast ruby so help me understand fast ruby what are you doing there in terms of monthly revenue i'm doing nothing right now it's free currently free for all the users but that's because i'm just really growing the platform but for that one i'm trying to raise capital actually well how do you know that's gonna be a bigger opportunity than the one you're then borough which already has paying customers uh well i could i could show you the numbers but we're talking here but it's a sir it's a serverless platform we're talking about a market that will be hitting uh billions i think 19 billion dollars yeah that's all fine but those are all i hate market stats because like it doesn't really matter right it comes down to like you and can you build a mousetrap that gets people to pay and you've already done that on bro you have no paying people on ruby so i'm just trying to figure out why you would throw out the thing that is already making some money for something that's not yeah no i'm not throwing it out sorry you know you know what i mean why don't you put more of your time into the thing that's already making money so well i guess you're right i've been i actually been thinking about this uh for the past uh few weeks so don't don't agree with me paulo i don't want you to disagree with him i'm not agreeing with you man i'm telling you like this is the this is what i'm being thinking um no but there's a reason like there's a reason that you said i'm gonna ignore and not put my time into the 500 a month thing and put it into fast ruby i'm trying to understand why what bigger potential do you see in fast ruby that you don't see in bro well it's it's the rev the money that it's the difference between building so so the thing is with boro there's no much room for growth like i can't make this like a a a 50 million a year revenue kind of company because that's just uh the thing about what boro does is it's it it's just it's it's just between that uh those two lines of like okay developers they could do that themselves you know but they'd rather pay five bucks a month that's why it's so cheap so it's not and the space is quite crowded too so uh it's uh it's it's not talk to me a little bit about your slack group um you have at the top of the website on bro join the slack workplace workspace how many people have joined uh let me see i'm gonna check that out for you right now um but quite a bit it's loading here how do i see that uh bro uh members so they see this administration numbers um not everyone joins though yeah i'm just curious how many how do i count here do you have a seat i have no idea uh full member 73 okay 73 people and how do you use this do you use it for like marketing purposes or no no i just i just put it there so people has will have a direct uh channel to talk to me basically when they need anything but again the thing is pretty hands off like i rarely have any problems with it but but you're totally right it's it's funny that you're saying that i'm not agreeing with you it's just something that i have to put more effort and it's some of the effort that i uh to be able to scale this a little bit more there's some rewriting that i have to do on the code base and i actually want to use my other project fast ruby to do that so there is a plan yeah yeah they work together very good all right man let's wrap up here with the famous five number one what's your favorite uh what's your favorite book business book oh i don't know if i can call this a business book but i recently read the four hour work week and it's pretty awesome number two is there a ceo you're following or studying um no not really number three what's your favorite online tool for building your company favorite favorite i would say uh digital ocean number four how many hours of sleep to get every night uh less than five and uh what's your situation well i think you said he had two kiddos right are you married yeah married two kids and how old are you i'm 36. last question what do you wish your 20 year old self knew uh that i should have tried to do stuff on my own instead of uh focus too much on a career to be honest guys start earlier bro.io has about 100 developers paying five bucks a month to set up tunnels using his platform doing about again 500 bucks a month total in revenue also has another ruby idea he's building that he thinks has bigger potential so he's working on building that at the same time potentially raising capital paulo thank you for taking us to the top thank you