How Castos CEO Craig Hewitt grew Castos to $3.6M revenue and 2K customers in 2024.

hello everyone my guest today is craig hewitt he's the founder of castos a fuller remote team remaking uh how podcasters create great shows grow their audiences and further their brands craig grady takes the top yep i'm ready so what came first for you are you a technology guy that got into podcasting or a podcasting guy that wanted to solve his own scratch his own itch and learn the tech yeah definitely the second uh kind of got into podcasting a roundabout way and and kind of the business side of it and uh yeah it's been yeah just over three years uh since i've been around and cast us and it's been a lot of fun very cool okay so for folks i've not heard of it what does castos do yeah so we're a podcast hosting an analytics provider that also has a built-in production service so for shows like this for folks who want to kind of host their podcast distribute it to places like you know apple podcasts and spotify that's what we do provide analytics around that and then have kind of a done for you service arm that that takes care of all the editing and show notes and publishing uh so we're kind of your built-in podcast producer so would you categorize this i mean more as a it's pure software running this show or is it really software plus humans some professional services built in yeah we're software with the service yeah okay interesting so just so we understand sort of the split and this will kind of guide my my questioning um if you look at your total revenue over the past 12 months what percent would you say is is software requiring revenue versus setup fees professional services yeah like 70 30 70 sas 70 cents yeah okay so let's focus on that for a second then we'll circle back to professional services if people pay you just for your what you offer on a sas basis what would they be getting uh so you get hosting and analytics uh so we host your audio files help you manage rss feed which is kind of the thing that podcasts are uh and then we give analytics about you know where folks are listening and how many downloads your shows get so very similar to like libsyn or other other players like hosting platforms like this yeah yeah at its core we've done a lot of you guys kind of expand no because i mean i think that's the that's the easy that's the easy analogy but i think what we've done is is kind of expand the idea of that a lot so we have things to kind of repurpose and extend the content that you create so we have things like automated transcriptions we have automatic republishing of your content to youtube so for folks who aren't recording video like this they just want to do audio because they don't want to you know get all pretty for the for the camera and stuff like that we can give them a way to have a presence on youtube uh where they don't have to record native video content so we've done a lot with a platform to to do that to be more than just a hosting platform but really kind of like a marketing platform for podcasts i see i see okay and what do people what do podcasters pay you on average to use this per month yeah so we have plans starting at 19 a month all the way up to 100 a month um and we have annual plans you know for like 20 discount off that would you say the average is probably around the 1920 mark yeah something like that yeah most most folks are on the beginner plane because a lot of folks you know podcast is for a lot of people is not a revenue generating thing so they have a hard time paying too much for it what is the upgrade tactic you use to get folks from 20 bucks a month to 100 bucks a month yeah so we feature gate a lot of a lot of what we do so um things like the youtube republishing automated transcriptions uh an integration with a tool called headliner to create audiograms um and some advanced analytics uh the last part really gets up into that that higher tier i think analytics as you probably know is something that the podcasters are hungry for more of and we have some some proprietary uh analytics that we provide folks in our and our pro tier at the 100 month plan and and when did you launch the company uh yeah right at three years ago we launched uh the company officially once okay put in 2017 and you bootstrap today or you decide to go to the equity or raise capital uh we took a small amount of investment and joined the tiny seed accelerator um about just over a year ago so we were part of the first patch there uh so we got a little bit of money there um but otherwise have been bootstrapped we just had inaura on who really broke down how how tiny seat operates and works and how it all works and he surprised me with the statement he said he believes 80 percent of the fund returns will come from companies exiting not dividends which is kind of the i in my opinion that's really idea of what they're building which is you never have to sell you can build a great profitable company pay yourself you know dividends and oh by the way pay us our dividend cut as well what are your thoughts on that as a founder on the other side um so i mean you know being in the podcasting space we're not you know a crm where we're going to be around forever we think we could be around forever you know there's just a ton of kind of velocity in the podcasting space these days and so we expect something to happen with our business in the next five years say and so that's that's a lot of why we joined tiny seed and that's that's kind of the path i expect us to take cause something will happen i don't know what that is we have a lot of options because you know now we're profitable um but but i'm surprised to hear uh that that you're surprised by that because i view like tiny seed getting their money back being mostly in in exits for for founders um just because i think that's the way a lot of businesses go i think a lot of people at some point i see my thought though is i mean i when i interview bootstrap founders many of them have built extremely comfortable lives sitting on castro from the business they are the exact opposite dna of a founder that wants to scale big and sell for a bunch of money it's like the exact opposite dna so the fact that and by the way like when i listen to how anar and rob and the team sort of talk about tiny um it feels very much to me like we are for the bootstrapper in kentucky that's happy with a 5 million ar company and 2 million a year in profits that never wants to sell so it just that's why it surprised me niner said no we think 80 of our fund returns will come from companies exiting yeah i think i i would guess that the the founders are maybe a little more ambitious than the person you described why do you why do you equate an exit to ambition i would argue that there are extremely ambitious founders that have built great profitable companies and that's actually sometimes harder to do than get some big exit yeah i think that's a fair point i think that you know if you look at really kind of changing your life and putting you on a different trajectory you know selling a business for 20 million and taking home you know whatever 10 uh it changes your life versus a business that cash flows you know half a million dollars a year that's great but you can't just go f off and do whatever you want for the rest of your life like if you sold for a bunch of bunch of money and you could just put that into dividend funds and things like that then then you have complete control over your life and there's a different kind of risk i guess uh involved with your uh your path from there sure sure no that makes complete sense when you came back on on january 9th of 2019 you'd said you passed a thousand customers at that point what do you guys thought today yeah we're right at 2 000 customers oh wow the good timing on the show then exactly exactly doubled yeah okay very cool um so uh 2000 and then have you done anything team related so how many folks are on the team i think you were four people last time we talked yeah so we're seven full-time people uh and with the services arm we have some contractors that do you know audio editing writing with some folks on the marketing team that help on a contract basis yep of those seven folks how many are engineers uh two two okay and i imagine you probably don't have quota carrying sales folks for this price point right that's right yep yeah yeah yeah it's more but so let's go down that path for a second how are people finding you what's that what's the playbook here yeah so we do uh we we do a lot in kind of content and seo that's that's kind of our main acquisition strategy these days um we also have a wordpress plugin that we own and maintain called seriously simple podcasting that is uh that is kind of the way a lot of folks find us is throughout wordpress integration so if you have a wordpress site it's called seriously simple podcasting so if you have a wordpress site you want to kind of plug in a a blog to it or a podcast i'm sorry then you install our plug-in let you kind of add a podcast area to your site manage your rss feed from there and then cast us as a hosting platform is an optional kind of add-on that you can have there interesting was that intentional that...