Checkli Revenue & Valuation (2024)

hello everyone my guest today is marvin russell he's the former ceo of a top digital marketing agency in chicago and founder of my site auditor a sas startup he grew to over 20 languages around the world both were successfully acquired today he's the current chief checklist maker at checkley.com a new and simple way to make and share checklists marvin are you ready to take us to the top i sure am let's do it all right so i think the name is pretty self-explanatory i mean am i missing anything it's checklists yeah it's checkly it's just like checklist without the st it's a nice short simple domain name but yeah that's it checkly.com just like pepsi you know ending the eye but checkly sure how do you so so this space is notoriously really difficult like if you asked who's winning like the to-do list kind of app space people could reel off maybe 10 20 different answers oh after the agency and after your other company exiting them why decide to jump into this space and compete here oh simple as an entrepreneur my head is everywhere i've got a million things on my mind at all times and there was no go-to super simple checklist maker out there that i could find there is a lot of to-do list makers out there but they make you sign up for stuff they're complicated they're bloated they have way too many features i wanted something super simple super quick and super fast so i ended up building one for myself and then that kind of just took off and is it a free tool or is it a kind of what's your revenue model if you have one it is free you can use you can make unlimited checklists all day every day for free but when you if you want to sign up and store those checklists and come back and manage them later there is a small fee so it's a it's a freemium model you can make unlimited free checklists but there's added features on that you can pay a small monthly fee to get more features i see and when you look across just your paid customer base on average what's the customer paying per month for that those paid features um on average they're probably paying about five dollars per month we have a personal plan and a business plan so the business plan is a little bit more expensive it gives you unlimited uh collaboration with unlimited other team members and the smaller personal plans five bucks so it averages uh probably more closer to six or seven dollars per month okay got it and uh put us on a timeline for us when did you launch what year uh 2016 2016. okay good and then fast forward to today so is it just you kind of doing this thing with contractors or if you hired a few people what's the team look like i have a small investor i work for i do a little bit of consulting for a private equity firm one of the same firms that bought my last software company my set auditor and they wanted to stay in the business with me they told me like we want to be in the marvin business whatever you're working on can we work on it with you so i had a small little investment um to help pay for a junior developer i'll call it but he's more senior now but i have one developer who is my lead senior engineer if you will but he does all the tech stuff and i do all the business design strategy i mean you name it all the other stuff so he does tech i do everything else okay so call two of you guys both in chicago yeah both of those in chicago that's great and then so what have you scaled to today over the past two years in terms of paying customers well we just we were 100 free up until this year and we had about 80 or 90 000 members and the cool thing about us is the way we find all of our members is we're ranked literally if you go to google and search checklist we're usually number one or number two and we've got about 90 000 members around the world and we just added that paid model on um that you can pay seven uh i'm sorry 5.99 or 19 dollars per month and now we we're up to a few hundred members that are paying on average we talked about before but a few hundred out of that 90 000 and that's growing like crazy okay so coming can we say 200 is that fair uh probably just under 200 but like i said it's a brand new paid option it's working so far but we're just at 200 by the end of the month we'll be over 200. yeah no by the way i think this is great i want to dive into it right so 200 customers uh six bucks a pop so call 1200 bucks per month right now in revenue what month exactly did you turn on that paywall um we turned it on we tested a bunch of different pricing models but the pricing model that we're on right now happened around mid-summer and we've been tweaking ever since so it's been a few months um a few tweaks in pricing but we're kind of locked in with what we're doing now to walk me through that process there's a lot of people that build a user base they go through the same process i mean and they struggle with things like well what test do i run do i double price do i cut it in half what do i do so so what tests have you run so far and why did you end up at six bucks a month well the first question we had was should we charge a truck we should we ask people for a credit card before they start their trial that was the first question should we let them do the trial with or without a credit card we tested both and with the credit card got way more conversions for us because on our model free conversions are paid uh the i'm sorry free conversions are paid yeah um it's well paid conversions yeah i'm talking about paid conversions all of our trials have paid conversions so the the unique thing about it sorry martin i don't follow that at all so so if you sign up for a free trial with a credit card at the beginning they don't all convert into paid at the end no that's i'm sorry maybe i misunderstood the question um yes you can sign up for a trial well the way checkly works is really different than a lot of other checklist apps out there right when you get to checkly you can make a free checklist you don't have to log in you don't have to sign up you don't have to do anything you can just start making a checklist right from the home screen and at that point you can do whatever you want you can share that checklist you can download it you can save it but you also have the option to to your account create an account and come back and manage later if you do that there's a trial sign up and you get a seven-day trial you have to pop in your credit card if you choose to stay after that seven days then we ding your credit card and we move forward and we've tested that out before with and without the credit card and with the credit card helps us get way more conversions people commit more they're more anxious they've like they've told themselves they like the site enough that they're going to continue paying so we asked for that credit card now upfront yeah marvin just to be clear when you say more conversions you're you're not saying that you get more people converting from uh free to a seven day trial with a credit card at the beginning you're saying more people convert from a trial to paid if you ask for the credit card up front yes we we have we have we have a higher conversion rate i should say not more conversions but a higher rate yeah i know i'm just asking about what rate in the funnel it's not the free to seven day trial it's the seven day to a paid that is the conversion rate that's going higher if you ask for credit card at the beginning is that right yes okay the flip side of that is well what how many less pa you know sign up opportunities are you getting because you require credit card at the beginning so did you run a test where you didn't have a credit card at the start we did run the test i don't have those numbers off the top of my head um but we did we did test back and forth i can tell you is the the one that we landed on which was asking for the credit card up front ended up giving us more paid conversions so we ended up sticking with that we tested two models we tested different pricing models and we tested whether or not we're going to ask for a credit card at the beginning of a trial and the asking for the bigger asking for the credit card definitely led to a higher conversion rate that got us more paid members in the end because the people who weren't willing to put their credit card in they weren't really serious customers and they might have you know for whatever reason um didn't continue using our software for every reason so once we got them to commit with a credit card it our conversion rates were a lot better marvin it's interesting though how you phrase that because no one ever talks about the upper the lost opportunity cost because you can't see it right so the lost opportunity cause in this case is well yeah they might not be your perfect paid customer but it's because they didn't get to use all their all your features because you required a credit card the flip side is well if they use some of those features and they got addicted well maybe they would have been paid so how do you balance i mean this is emotion by the way there's not a perfect answer here but how do you balance this kind of very emotional tug of war well we the thing we wanted to do is we knew that people were going to give us a credit card and sign up for a trial if they got to test our software and that's how checklist is different than if you go to every single checklist software you can find right now on the web every single one of them is going to ask you to sign up and start for the free trial from the moment you get to the website we don't do that when you get to our website you can make a checklist you can make a free checklist that's live on the web it's a private link that only you get you can play around that checklist for an hour two hours you can come back and edit it but the moment you hit that save button that's when we ask you for a credit card to save it and manage it and come back later that's what different differentiates us from every single person every other company out there is we do that we we let you play with the site before you even have to sign up yeah you make checklists before you have to sign up and that builds value for our customers and they know they play with the tool they love it and they're like yeah let's put in a credit card let's let's move forward let me keep managing and editing this checklist marvin that's my exact point is that you put those things like managing and saving behind the credit card wall what i'm trying to say is how do you measure how many people would have paid if they had access to those currently gated features right now they don't have the opportunity to even use those gated features um that's something that we're actually testing right now i'm actually meeting with a conversion rate optimization consultant actually today at two o'clock um to help us understand how to test those options better and look at the actual data so we can go back and forth because we are pretty much a young company and i think that's definitely one of our weaknesses that we could test a lot of things more and look at data more but we're bringing in a side consultant that literally we have a meeting today at two o'clock with that consultant to uh kind of help us look at the numbers and decide what make better decisions in the future let me ask you a question if you what's your goal with like what's like a revenue target where if you grow this company too and make you really happy well my last software company got up to 40k mrr and that's that's the that's the thing that that people don't understand about this i have a lot of revenue goals and that's great you know i'd love to get this company to 10k mrr in the next uh by 2019 however the the thing that's different about my companies and my software companies that we've been able to do is we have no overhead we have no customer uh acquisition costs so whereas other software companies are paying for ads and doing all these things to get customers in the door we have none of that we have zero customer acquisition costs so our revenue doesn't have to be you know like 100k mrr or whatever the case is we're just trying to grow at a modest rate and trying to figure out different ways to do add-ons so to answer your question it's it's we want to get the 10k mrr and then sometime in mid to early 2019. yeah marvin those two things by the way are directly correlated right if you follow the thesis that the person that can spend the most for a customer wins the customer whoever has the most revenue or has or has raised the most capital can spend the most to get the to-do list customer and then their revenue grows as a result so like those things are directly correlated they could be but when you have insanely awesome amazing search engine positioning like we do um why would you spend money on a customer when you don't have to if you literally type in the word checklist we're in the number one or number two spot free checklist we're in the number one or number two spot we get tens of thousands of people every single month that come to our site because they typed in the word checklist into google and they got to our site so that's the same thing that happened with my site auditor we were on page one for free seo audit free site audit and again we get endless free customers looking for exactly what we do and there's just no need to pay for those to to pay for those customers when they're coming to us and they're targeted if we put an ad up right now and we were like advertising on facebook people that type in the word productivity or something like that they're not looking for checklists at that moment we get all almost every just in checklist into google they come to our site first we beat out everybody there's not one to-do list maker or checklist maker out there that beats us in that space i guess that's that's my background i guess that gives us a huge competitive advantage but i definitely see your point you know paying customers i mean people it definitely helps you build a better you know customer base by understanding who's going to pay for what but if we don't have to why should we no no more but i get that by the way your this is clearly a skill set you have both those terms when i type them in you guys do rank number one but even that there's a lot of people listening right now that says damn i would like i wish i could rank number one our revenue would increase in millions if we did that that's my point the right is like people don't pay for to-do list apps that's like my whole thing it's like why why not use this amazing seo talent you have and go spend it on an industry in a market that you know is a multi-billion dollar business well checklists are very personal to me i've had i've suffered from like severe like adhd i've suffered from severe anxiety my entire life and instead of taking ritalin or like adderall what i've been able to do is make checklists and that's been my you know since i'm 41 years old since i was 22 i've just made checklist and that's my that's my drug of choice instead of the ritalin the adderall to keep me focused i make a checklist every single morning and my goal is is to make that experience to replicate that experience for entrepreneurs all over the world so you can use our site software for free there's just paid add-ons that if you want more features and more options just like a lot of tools out there so i guess i'm pretty passionate about checklist it's a personal thing for me and that's why i'm i you're right there's a lot of competition out there but it's a passion of mine and why not focus on your passion yeah no look there's nothing wrong with your passions just passions don't always lead to profits and that's what i'm trying to get at right is what what are you trying to build or optimize for um i've i've interviewed probably i would say two dozen kind of to-do list or checklist app companies and they they're all struggling uh i mean drastically uh because it's just it's being commoditized apple's releasing products like this you know notes you're competing with like you know google docs right these all these kind of weird competitors that are not meant for to-do lists but that people use for to-do lists well let me give you a competitive advantage something that differentiates us from everybody else out there one thing that nobody else is doing that we're doing um i see a people couple some people trying to tap into this market but we've dominated so far we let you publish your checklist so if you're a company or a brand you can go to checkly create an account and make a checklist for a sales agenda or make a checklist for a drone or make a checklist for anything you can think of and you can hit the word publish and if you hit the word publish it goes it publishes live on our our uncheckly it's free for anybody on the web anybody in google to copy and use that checklist i just can't think of a use case where i would do that like i'm trying to put myself in your shoes and those examples you just gave i use like monday.com for that right if i want to do something with my team and publish it to the team and work together on it on that to-do list i use monday or basecamp or trello that's the here's the other good news about that is that any checklist that you publish live you can track how many times people copy it how many times people download the pdf and if you look at our checklists up on if you go to chuckley.com and you look at the published checklist out there they have thousands hundreds and thousands of different um copies and pdfs people here's the other good thing is why is that important that's what i'm trying to say like i'm looking at 2018 hallmark christmas movies list and schedule 4 000 views it's at your popular templates right now like okay so what like how is that important for i don't i just don't understand how it leads to a business it builds brand awareness so look at the company that's behind that look at click on their ggc yeah yeah so look how many pdf downloads they have look how many copies of checklist copies they have look how many views of their branding they have think about checkly as as is is slideshare for checklists right it's youtube for checklist you can share unlimited checklists out with the world and anybody can copy them when they copy them they can see your brand like oh wow xyz company made this who is xyz company what's what's their url oh here it is let me click on it and go to their website it's a way to also build your brand by sharing your most important checklist i'll give you another example i'm sure you're familiar with the news i want to focus i want to stay focused on this one though real quick because we're i think there's a good conversation so ggc this is i'm on a profile now a girl's guide to chicago and you've you've said this is like a perfect example she's one of your popular users 68 templates 3 900 copies save 6 000 pdf downloads and 57 000 views on her on her things but i'm on her profile she has five followers yeah the followers aren't that's just something we just added recently to the site but now think about it like this when you type in hallmark movie schedule which a million people a month are doing right now because it's a huge season for that her checklist is coming up as one of the top results in google now so not only is she building her brand awareness but she's offering a something tangible that a person can come away with and use and copy and actually complete that checklist if they want to if they want to watch all those movies so in 2017 the number one thing that marketers are looking for is new ways to market their content with interactive content checkly is the perfect example of that you can market your your your brand with actual interactive content anybody can copy your checklist and start checking items off and guess what the company that oh wow ten thousand people downloaded my checklist or 15 people copied my checklist and a thousand people are are have completed this task but not that task they've completed this task but not that task and that just gives you a huge advantage as far as understanding what who your customer base is what does she gain from that okay so right now i'm looking at this checklist the hallmark 2018 christmas movies list right and there's one that starts on october 27th christmas at pemberley manor all the way going through december 29th a midnight kiss it's got 4 000 views uh what i don't i don't underst how does she economically gain from this brand awareness about economic economically economic how does she gain from this well she wants to sell books if i'm not mistaken right if you click on her link i think the the link goes to a book selling website or a website that sells her book so anybody that goes sees that website which thousands and thousands of people like you just said have any clicks on the link on on the list that goes on her website can say oh wow this person has a brand new book that she's selling and she can track that she can see how many sales she's getting she can see the direct amount of traffic coming from uh checkly and how many contributed directly to her sales using analytics and you know basic goal setups and google analytics got it got it interesting i mean look dude what i what i see here and what you've done which is really incredible i love that you built this for yourself a lot of entrepreneurs invent problems i love they built it for yourself but like secondly you're clearly have a really interesting skill set when it comes to seo i mean you're ranking for these terms not only for checklists but also you're helping your users rank for lists that they're creating and i totally see the value there i'm just pushing again i'm a capitalist right so i'm pushing the bus i want to see you make this even more popular i know the way you make it more popular is more resources and resources if you don't want to raise capital it's use your customers revenue so i'm just trying to figure out how to get more revenue faster i don't i don't have a direct answer for that and that's a great question that's something that we're trying to learn but i can tell you this that what would you rather do would you rather spend five hours on a blog post or 20 minutes on a checklist that's going to rank probably in the first few positions of google because google now looks at schema it's very important they want to see structured data and every single one of our checklists are structured i'll give you another example go to google and type in nfl teams by state our checklist comes up number one it's it's anybody that goes to google to search for certain key terms a lot of our checklists are now coming up number one in the search results because we're perfect for google i've looked at i understand google's algorithm extremely well and i've developed checkly to to i don't know take advantage of of of google's algorithm and now it's paying off we're getting tens of thousands of people i mean we get 50 000 people to our site every single month now and i've never done one piece of marketing i've never done anything i just did seo but your electric rank is like 232 right i mean 232 thousands i mean it's okay but it's not great yeah it's a brand new site though i mean it's it's we're doing way better than most checklist sites out there as far as traffic goes they pay for their stuff i don't pay for anything and i get better customers than them because i get people who who are looking to make a checklist right then and there well i don't know better i don't know if better customers right i would say you have more users maybe engaging or doing something on the site well think about think about like a competitor right they put an ad out in the productivity space and they're they're putting ads out hoping that people who just want to you know be more productive click on their link and go to their website and oh maybe they'll make a to-do list we don't have to do that we want we get people who type in the word checklist and want a checklist right now so our our we definitely have a lot of challenges out there but i would consider our customer base way more targeted way more focused and a lot of those companies our competitors would kill to have the the type of customers that come to potential customers that come to our site because they're direct that's what i'm saying though right that's the big difference is what i'm saying here is i don't think that they're customers i think they're users of a free tool like listen to doist can spend five bucks on on a click when someone searches free to-do list app why because they know that they know that five dollar click it takes 10 clicks for 50 bucks and they know one of them is going to convert into a 50 a month customer they know and the reason they're convert to a customer is because they know what the activation metric is to get them to stay and not churn like that's why the engine works right so i just think you're doing different things by the way like i love this like i i mean i i think i think it's a really interesting use case and and i'm pushing it here just because i want to learn more from getting your brain a little bit so i appreciate you playing and playing along yeah you should make a checklist make a checklist of top entrepreneur podcasts you know the 20 top entrepreneur podcast and you know if you make a good checklist and you know maybe in a couple of weeks your checklist will rank that checklist will rank number one for top podcasts to listen to for entrepreneurs and boom if your your your podcast is number one you'll get a lot more viewers not you know i'm just giving you another example of how you would use the actual system so that's how we differentiate from a lot of checklist apps out there and trust me we hear left and right that people want a free version of this checklist software that we hear left and right and we're exploring ways to make whatever they want very very good right that's the thing they don't wanna they don't wanna pay for it the question is how you monetize it so you're definitely right we have challenges as far as monetization of it but so far it's growing a little bit it's not too bad we're we're pretty happy so far but it obviously could be a ton better uh yeah you just strike me with with what you've shown me in the examples you gave me the nfl thing the hallmark stuff like you strike me as someone that should be building like sem rush or ahrefs right i already did that i built my site auditor and we were in 20 languages around the world and i sold that company for millions and now it's it's it's it i've been called back to that company to help consult why did you sell it though if that was so passionate for you in these checklists and the ranking you talk so highly about ibogaine i can feel your energy as you talk about these rankings why sell that thing that you're so passionate about because i'm a crazy entrepreneur that can't sit still i want to do different things and i if i'm not creating i'm not happy i want to keep doing different different different stuff so i'm still involved with my site auditor i still run the company because they just literally just hired me back to come in and and and get the you know right the ship so to speak it wasn't going in the best direction i was losing a few members here and there but we've recently just rided the ship and now i'm kind of back in charge of kind of overseeing things just from a part-time standpoint you know not even a part-time probably less than that what year do you sell that company in 2016. 2016. okay got it very good all right june 9th i mean sorry june 3rd 2016. got it very good if i get a tattooed on my arm that's good marvin let's uh let's uh sorry i just realized we're also way over time this has been a fascinating interview let's wrap up here with the famous five number one what's your favorite business book uh the checklist manifesto that's not related to you well related to me my favorite business book hmm let's see um what would be my favorite though i'd still my favorite book of all time is a chuckles manifesto it's a case study of the case study of businesses left and right that how they use checklists that's the top thing that comes in my head all right that's cool number two uh is there a ceo you're following your stuff like four hour work week too i'm a big productivity person but like yeah number two is there's and i have rand fishkin's founder which i'm halfway through as well sorry that's okay is there a ceo you're following or studying yeah i like rand fishkin a lot number three what's your favorite besides your own what's your favorite online tool for building your business oh man you see you asked me these trick questions checkly is my favorite online tool for building my business because it's easy everyone would say their own company the goal here is to educate the audience on tools they could use to build their business so name something that's not your own tool name something that's not my own tool let's see um actually here's a crazy one facebook groups are a huge source of information insane source especially the closed ones number four how many hours of sleep are you getting every night um well the night before i got four last night i got seven so let's average that out to five six six five and a half number uh and what's your situation marvin married single kiddos married and if you can see behind me there's a mini australian shepherd that's my kid all right and how old are you i'm 41. last question what do you wish your 20 year old self knew um that uh how bad do you want it is the key to everything you want in life a lot of people want things but how bad you want them is the key guys how bad do you want it sold as first company for a couple million back in 2016 now focused on uh checkly again helping make uh checklist and the ability to build a checklist for free with no signups super easy working and trying to figure out a paid model launch this one in 2016 two people himself and an engineer full time they've got about 200 customers paying six bucks a month for 1200 bucks a month right now but they have 80 to 90 000 total users that have signed up for the platform to give it a go so marvin thanks so much man for taking us to the top appreciate it yeah thank you for having me