How Citygro CEO Catherine Geanuracos grew Citygro to $120K revenue and 20 customers in 2018.

hello everybody my guest today is catherine jennarockis she is the ceo and co-founder of city grows the first self-service operating platform for local government has extensive experience in startups digital marketing and civic technology catherine are you ready to take us to the top yeah all right thanks so much for having us yeah selling to governments is not easy so help us understand uh what are you selling to them is it a peer play sas company we're a sas product and we're bringing a freemium sas model to government for the first time so not just software as a service but a traditional sas model where governments can get started start using our platform then find out if they like it if they need it and then grow their usage from there and if we just look at kind of your paid folks what are these governments paying you on average per month to access your technology uh so right now we have kind of a two-pronged uh revenue strategy where we have both a subscription plan which uh for most small governments is about five five hundred dollars a month we have larger governments paying 2500 a month and then they pay a percentage of all the permit license fees processed through the platform so that's two percent of uh of any payments that we process through citigrows and if you look at your revenue over the past 12 months what percent of that pie was sas versus the two percent model oh so right now it's mostly the sas revenue because uh we start when we we're still pretty young company and usually governments start with just a couple of processes per uh government but what we're seeing is they're adding more and more workflows over time so say we start with business licenses in the finance department then we move to transportation permits in the transportation departments and then um uh block parties in uh you know the kind of um arts and culture department so we start kind of small with the payment processing but then that grows over time right now still the bulk of our revenue is self-assessment and when you're when you launch the company what year uh we incorporated in 2015 and we started uh with our first live process with the city of santa monica in the spring of 2016. it's a pretty hip city to start with yeah we actually won a contest they did called hack the beach it was a challenge to bring tech into local government so my business partner stephen corwin he's a developer and he this is before i joined the team he sort of submitted the very version of city groves to santa monica they loved it they've been our client ever since they've been a huge supporter of our work so that's amazing and who else have you added since then so how many customers are you working with today governments all over the country now still primarily our kind of home base started here in southern california but now we have a base in erie pennsylvania we have some staff there as well so we've got folks from massachusetts pennsylvania colorado california we're starting to get some interest from out of the u.s as well sorry what was sorry what you cut out right when you said the number so how many customers do you have today oh just about 20. right now about 20 okay very good so 20 customers 500 bucks a month you guys are doing what north of 10 grand a month right now in revenue more that's nice yeah that's great i like the scale and if i go back a year ago today were you doing nothing at that point because you just launched uh we had and we had just a couple of governments done so one or two probably two paying customers then okay maybe a thousand bucks a month that's that's a nice skill and are you having to go in i mean what does the sales cycle look like on this because everything i've heard about government is it's a really long sales cycle yeah so that's we built our whole product and our business model to go around that sales cycle so our fastest time to acquisition uh was two weeks so you know the kind of classic knock on why people don't like to sell tech to government is because it can take a year or two even just to make a sale we built our whole product so that's not required because there's no big upfront cost uh governments don't have to go through a few full rfp procurement process they you know the thing i like to say is like you know they didn't procure twitter they shouldn't have to procure their other technologies right they should be able to just start using our platform see if it works for them and then go from there yeah and have you guys raised capital to do this are you bootstrapped uh we raised a little bit of friends and family money and we're actually uh almost done raising just a very small seed round but um as you can imagine uh most traditional vcs like kind of look down their nose at gov tech which we think that makes it an incredible opportunity there's very few um competitors in the space really relative to the size of the market so how much total raised including when you're about to close oh so we're raising just half a million dollars okay and does that so half a million into the company including the first round you did no uh first round was uh just about a hundred thousand dollars in 2016. so 600k total that that's pretty good yeah you know people might look down on it but the flip side is also true once you get the government as a customer they're also very very sticky typically tell me about your churn we have zero percent churn of our clients so you're too cheap no we're too good no you're too cheap you should always have a little churn my in my opinion what's the team size today how many people uh yeah you said 15 people oh gosh no five five five people all based in l.a small and no we're a remote first company so uh la in new york dc and erie pennsylvania okay all remote very good i love that and uh are you operating obviously about to raise some capital so you'll be burning cash again but today are you casual positive we're like a little in the hall right now but we've um we've had some good uh we got some investment from an accelerator this year and then i just won uh the women founders network la's fast pitch uh competition so that came with a nice check too so i think technically right now we're uh we've got some great cash in the bank and we're looking forward to getting some more in through our raise that's great catherine okay let's uh let's wrap up here with the famous five number one what's your favorite business book oh gosh um i literally just met yesterday noam wasserman i'm gonna go founders dilemma because he gave it to me yesterday number two is there a ceo you're following or studying uh i l i'm inspired by like some women tech ceos out in the world so i've always followed marissa meyer's work obviously uh i've looked at oh gosh robin chase um from zipcar like there's there's a bunch of people i i pay attention to number three what's your favorite online tool slack number four how many hours of sleep to get every night oh i sleep a lot like seven and a half seven that's that's good and what's your situation married single kiddos uh i have a nine-year partner and two adorable dogs one of whom has been in this interview the whole time oh i love that okay so partnered no kiddos and do you mind me asking catherine about how old you are uh no i'm gonna turn 49 in january oh congrats that's exciting so last question what do you wish your 20 year old self knew oh my gosh uh do exactly what you're thinking about doing like go live in latin america um have fun in the san francisco rave scene there's plenty of time later in life to be an entrepreneur are you a raver catherine are we going out to rave tomorrow is that what's happening i mean it's a long time ago but we did go to this amazing festival in marrakech this year so that's my other piece of advice like don't think that stuff has to stop when you get older i love that guys there you have it from katherine do exactly what you're thinking about they won a competition uh back in 2015 2016. now city grows is helping local governments process and you know streamline a lot of the stuff that used to be paper and kind of older technologies serving 20 customers 500 bucks a month so about 10 grand per month in revenue up from a grand a month just a year ago so nice growth they're about to raise another 500 000 bucks so they're capitalized to the extent of about 600 000 bucks to date five people on the team all remote as they look to scale catherine thanks for taking us to the top thanks so much for this it was super fun have a good day