How Clatter CEO Josh Newman grew Clatter to $2M revenue and 10 customers in 2024.

hey folks my guest today is Josh Newman he's an Innovative product marketing technology leader and Enthusiast he's the founder today of clatter a creative automation SAS platform enabling large businesses to create branded PowerPoint presentations microsites and marketing collateral in minutes the Clutter Suite is made up of productivity tools including presentation maker collateral maker and a bunch of other products currently used by 5 000 users across 10 Enterprise customers Josh you already takes to the top yeah let's do it all right 10 Enterprise customers and 5 000 users to me screams net dollar retention of 150. so it net dollar attention is good it's um and it's it's probably is around 150 but not for necessarily the reasons you would think a lot of it's going to be around that will add on Professional Services to it so some of it is mrr but it's a lot of it's around the Professional Services kind of arm of what we do so break that down for me you know last last month let's just use August first first you know last most recent full month of data what percent of your revenue is Professional Services versus recurring Revenue so it's going to be it's going to be probably and it's it's grown over the the life of of collateral kind of the four years that we've been doing this right now it's going to be probably 70 72 is going to be in the range of mrr and the rest is going to be uh additional Services I love this split because when you put service on a customer they tend to stick longer so um I guess tell me about tell me about one of these customers if you can what how's the customer using you today and how many seats like how what teams are you going in the dev team the engineering do you know the marketing team the sales team who's using you so the our our day-to-day customers are going to be the marketing team the users of this though are going to be split between the marketing team and the sales teams and so think of it these are this is these are Big organizations so one of them and when I say 10 Enterprise customers if we're being totally transparent two of them are actually split where think about an Enterprise think about a a fortune 25 company we have a few different customers within that same company but these are groups that are totally independent they don't even know each other so it's the same logo but I I'll split it up as different customers because they're totally unrelated to each other yeah yeah I mean this is all I mean I'm seeing sort of a comp this it's almost like a it's like a Content management system right you have a branded slide deck you want everyone to have access at all times so that they can create their own iterations of the master brand guide right and you need to do that across many languages countries and brand styles and colors oh yeah would you agree yeah that's exactly right and and that's for the presentation maker tool and then of course collateral maker for brochures microsite maker for landing pages and microsites summary maker for data heavy kind of upload Excel Json XML and we'll build you a beautiful on-brand looking table chart whatever you need very cool okay so what are these customers paying on average per month to use the technology okay so from uh from a monthly standpoint the the average per month is going to be somewhere around probably five thousand dollars and you're going to have some customers who are going to be lower where those might be folks who just use one of the one of the products you might have some that are going to be higher where they might use three or four of the different products and then what we'll do is if you've got one product that's going to be around 2500 a month but if you're using three or four it's going to be around six thousand a month because we discount kind of in from a bundling standpoint and do you have power laws in your custom rates what is your largest customer pay per month a large customer pays uh they're 10 grand a month and what what they're doing though is they're they're using us so using the PowerPoint Builder example they're using this from a full service model they'll email one of our project managers and just say here are all the side they'll do it a few times a week here A bunch of slides put them up for us we've got other customers where it's self-serve if you want it to be this particular client they're just they're busy they've got a ton of content some of the others they'll manage it all themselves we don't even know what they're doing on the system oh what's going on there YouTube good to see you guys now imagine this you love watching these interviews with SAS Founders but imagine if we took all of the valuation data out from over 2807 interviews I've done manually saves you a lot of time well we've done this we've built the into the beautiful interface inside of founder path check this out I'll show you how you can access this in a second but you log in you connect your stripe account 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share with us on the show so traction 1.2 million seed round 3.7 raise they sold 22 percent of their business go in here and filter by the event maybe you only want to see companies that have sold the whole business well here are a bunch that have been acquired the valuation and the multiple maybe you're going out right now and you're raising your seed round well go in here and look at all this recent seed deals that went down what they raised what valuation they raised at and what percent that they sold there's never been a larger data set of SAS valuation than what you can get now inside of founder path and we're thrilled to bring it to you all right we're gonna go back to the YouTube video here in a second but if you want to check this tool out if you want to jump in and sign up you can check it out for free to get your valuation at this link this link founderpath.com forward slash products forward slash evaluations or if you go to founderpath.com and hover over products click on get your valuation here and go ahead and sign up to give it a whirl again all that valuation data live right inside the platform I hope to see you there all right let's jump back into the interview that's very cool okay when did this all get going what year so it started in 2019 and actually started with a bespoke model where we super long story short Chief marketing officer of one of the the largest divisions of this particular customer came to me and just said Josh we've got thousands of PowerPoint slides we don't know how to organize them the sales team is struggling there's no consistent messaging no consistent branding help us with my very rudimentary PHP skills I'm not a developer put together just a really rough proof of concept sold it through they said we love this we want to build this they gave us 250 000 to build out this solution so I think it was kind of a Professional Services piece at the time wait but hold on we can't just glance over that that's huge I mean some people go sell 20 their business and that's their angel check how'd you convince one of your first customers to write that kind of check up front sure so my my background is I've been I've been running an agency for since two thousand to and so it had been a customer of ours for years so we had built the trust but they saw what this could do and treated it like a project and so when when that kind of funding came in it gave us the opportunity to build it our cost to build it was half that so 125k this launched within just a few months of it launching they said we love this thing it took off people were huge fans of it so they said we want to make some big improvements to this at the same time sold it through to another customer so I was able to take that 125 plus another 125 and went to the group that built the bespoke model and said can you build an Enterprise version they said yes they weren't actually able to so we ended up kind of hitting a little bit of a you know of an oil slick this was 20 20. this was in 20 end of 2020 beginning at 2021 is when we found out that that so how much how much money did you lose on that so we actually we didn't lose any money we actually we just lost a lot of opportunity cost there was no real money loss because what we had working was was good but we had one very understanding customer who even though we were six months late on delivering a product they understood they weren't under a real-time crunch a little bit of luck there uh but at the time brought in a CTO he was able to to kind of from a fractional CTO standpoint he was helping coach the team that we were using was a team in India they just couldn't get it done so we transitioned over to a team that this fractional CTO had used on a regular basis kind of his team and they're based in Poland and the really kind of come together they've brought it up to Enterprise standards and really just as of about a month ago we were able to be in a position where we could say okay now we've satisfied all the customer agreements I can go and start to to sell this thing you know in the marketplace who is the who's the Indian firm you're using now today uh no so that we're no longer using the firm in India the the T it's a team in Poland it's not it's just it's somebody that the fractional CTO it's a group of a group of folks that that do they have a website though uh not that I know of I see okay okay got it okay so you get that fixed though you see how many customers now today uh so today we've got that that's where we have the 10 customers oh amazing okay so can I take 10 to 10 customer times the 5 000 rpu you're doing about 50 Grand a month in Revenue yeah exactly yep that's amazing okay so 600 000 bucks in ARR and where were you exactly a year ago do you remember uh and so I I and you're gonna ask that um so we were so from a um from an ARR standpoint we were at 370 a year ago uh but total total revenue was 675 last year because um we were doing more from a uh Professional Services standpoint this year the it's changed a little bit we're we're doing a little bit less I think from a Professional Services standpoint but um but the the the mrr has gone up so that's what do you think total revenue this year will end up being uh we're looking somewhere probably around 8.50 when the years when years stop but much higher percent is true recurring SAS yeah now it's at 71 and a year ago it was 55 that's amazing you know you must listen to you must listen to the show you know all the answers awesome awesome that's amazing Okay cool so 30 grand up to 50 Grand now more pure play SAS that being said we love Professional Services it does a lot of things for your customers and now how do you deliver those Professional Services how many folks are on your team today and how many just do Services sure so so to split it up the um our team I'm the only full-time person on clatter we've got media Tavern which is my agency they're the they're the folks who in media Tavern does a really nice job of kind of running itself I I do business development in some of the high kind of the the customer service with some of our our higher end clients but the Professional Services we'll just subcontract out to Media Tavern so it's something that we're already doing we're already designing PowerPoint slides microsites Flyers brochures so you're the only full-time employee at the SAS company which is doing almost 600 000 bucks in ARR that's correct wow okay so how are we getting your engineering done today where's the engineer it's it's all that's that's the team in Poland it's a subcontracted team oh but but they don't have a website or anything no no it's just it's yeah it's how did you how'd you find them though how did you find the person in Poland so my my fractional CTO who's just a guy in in Westport Connecticut where I live and where clatter is based it's just a local guy that I've known for years and he had some availability he knew my struggles with the team in India he said I'll come in I'll help you out he brought his team in yes oh interesting okay so he's not he's not full-time but he's how you get all the development work done that's correct I this is amazing okay and so 50 000 bucks a month oh again we're just talking the clatter not media Tavern 50 000 bucks a month revenue on clatter I imagine you're very profitable yeah it is it is profitable at this this year we'll do I'm looking at my spreadsheet we'll do about 274 in profit and how do you put your Capital allocation head on for a second as a Founder how do you think about taking that profit do you take it out as a dividend and go buy real estate do you put in a media Tavern you reinvest in the software company what do you do uh so we'll I'll take a little bit of it out but for the most part I'll put it back into the I'll put it back into the company now that we've been like I said we're only about a month out from a place where I was thinking all right the product is is good enough where I can go to market it's going to be impressive I finally have a demo that I can go and start to show to people so we've actually we've put in reserves about 200k where that can be used for a rainy day can be used for some marketing that we're going to do so instead of needing to go and raise immediately or or needing to take some sort of debt we we have a little bit of money to play with uh that's awesome that's great okay so bootstrap today a lot of profits one on the team so how many here's a good question how many people last month did you pay at least a dollar contract or like including your guy in Connecticut uh okay so um including some of the folks at media Tavern who would have done the Professional Services it's probably eight or nine okay interesting interesting I'm just I'm always hunting for who's gonna build the first like 10 million or 50 million IR company with one full-time employee so you're you're on your way for 100 million I hear your I hear your teasers yeah yeah you're you're on your way I mean it's it takes so much systems discipline to build around contractors because the way you get a a cheap contract cheap labor to perform at a plus levels is you give them a great system to follow and building the system is a lot of work oh for sure yeah but but you're sort of leaning on the development side systems you're leading onto this guy in Connecticut what about marketing and sales so that part we haven't I I haven't gone down that road yet it's part of it that is my background a little bit because that's what media Tavern does so got a plan in place right now it's just figuring out kind of where do we where do we want to put the money what's going to be kind of our our next approach mm-hmm it's interesting okay before we wrap up with the famous five here how are you getting you know obviously you can sell all your agency customers on the SAS product but then you got to find a new growth channel right so how are you getting new customers today yeah so so we what we're going to do is I'm starting with that from from really the floor up so I'm going to be starting with the um just my my who do I know list so going to folks that I know within my network we're working actively on SEO uh pretty soon I'm gonna do I'm gonna I'm gonna take the the product hunt approach which um and I know you you've talked a little bit about that um so I think it's uh I think it's some of those I'm gonna look at um at affiliate deals I think a big one too agency partners to be able to get literally other Professional Services firms and if if this needs to be a white label product if it's something they can just sell in and we can figure out what percentage and you know how do we want to do that kind of you know over the first year or two of some sort of affiliate fees I'm thinking that's going to be the approach um and kind of my next move is to bring on kind of a fractional CMO to uh to kind of listen to my ideas and and kind of help me pull it all together that's awesome well we're certainly rooting for you hope you come back around a year and give us an update but in the meantime let's wrap up here with the theme that with the famous five number one favorite Business book uh favorite Business book it's gonna be the 10 entrepreneur by Patrick McGinnis ah okay 10 entrepreneur number two is there a CEO you're following or studying yeah I love what Melanie Perkins at canva is doing and it's it's sort of loosely related to my world too number three what's your favorite online tool for building clatter uh I'm gonna say uh Google Suite in jira number four how many hours of sleep deed every night yeah about seven and situation married single kids uh married with three kids wow busy guy how old are you I'm 46. 46 last question something you wish you knew when you were 20. uh man learn to code the right way don't be some sort of hack to build MVPs so funny all the engineers say learn to sell and all the sales most people say learn to code right it's just it's the nature of SAS guys clatter here an incredible story startup as an agency they still run the agency right the tavern company now though clouder.io helps you launch you know your your presentation templates and apply one brand style guide to thousands of presentations that you're building they've got 10 Enterprise customers today paying 5 000 bucks a month on average 50 000 a month in Revenue up from 30 grand just a year ago they've got about 72 percent of their revenue coming from Pure SAS the other Professional Services which is great it's allow them to stay profitable today and also bootstrapped a lot of cash in the bank very profitable uh Team of one he's got nine contractors he pays on the side as they look to continue to scale we'll see what happens next Josh thanks for taking us to the top thanks Nathan I'll see you in New York in March at uh that's open let's go man see you there take care awesome thanks Nathan one more thing 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