Contentellect Revenue & Valuation (2022)

hello everybody my guest today is mark bromahl he spent the last six years working in ad tech realizing that the great content that great content on a prize any successful online advertising campaign he launched his own content creation agency in june 2018 and called it content elect since then they've helped a number of smes grow their businesses through content by creating high quality search optimized content for their websites mark you ready to take us to the top i am all right so first off there's all kinds of kind of content you can create when an sme signs up with you what kind of content specifically are you creating for them is it tech space video based and for what platform typically sure so it's actually specifically uh written content for their blog so the the problem that we're sort of attempting to solve is that companies usually don't have much of a problem in writing product pages and getting the the core of the site built out but in terms of trying to continue to rank for mid to long tail keywords and grow the site over the the procedure the the forth coming months uh writing blog content is essential to ensuring the sustained growth of their website and in many cases small businesses don't have the uh the resource to rely on to have someone writing blog content full-time and that's where we come in the biggest challenge i've had with doing this i've tried so many times to hire for this is the the person whoever i'm hiring the company has to have so much subject matter expertise to put actually put out valuable content that doesn't look generic and automated that it would take you forever if i paid you it would take you forever to get enough knowledge to write meaningful posts how do you solve that problem because you're working with i assume dozens of clients yeah i mean that's a really good question um so look we don't profess to be subject matter experts because we just can't because we're writing as you say across such a broad range of different niches and subject areas what we do say to our perspective clients is that we've got writers who are very knowledgeable and highly skilled in writing really great content and we'll sit down with them and brief them on the type of content that needs to be written thereafter what we then do is put out one piece of content to the client and ask for all of their feedback upon receiving the feedback we work with the client to find the tone of voice and the type of content that they're happy with and until we find that we don't proceed forward with the project and usually that takes a few revisions and sometimes can take one or two but it can sometimes take more revisions than that but again how do you manage the subject matter expertise though right i mean i i just i know valuable content that actually gets page time viewership i've called three four or five minutes in this day and age you have to have some kind of knowledge of what you're writing about how do you get that just so we've got obviously a team of freelance writers we use and we've got about 10 of them working for us at the moment and each of those writers will have subjects which they're particularly strong in so depending on the type of client that we are selling into or the client that we actually land we then uh will allocate the project to the writers who we know are strongest in those areas i see now with that also is i should probably qualify and say that we're mostly focused on the travel industry because that's where our content writing uh expertise mainly lies okay and so um what are customers paying on average per month for this or is it project based per blog post uh no it's uh on average they're paying us about 1 200 a month and for that they're usually getting anywhere between 5 000 to uh 7 000 words of content a month okay sorry seven to what uh five five thousand to seven thousand words of content a month and how many blog posts is that typically so we usually write a blog post to about a thousand words that's sort of like best practice in google's eyes but sometimes certain clients prefer uh posts to be written to shorter word counts they might say instead of having five a thousand word posts let's go for a few more and have them at 800. sure and uh put this on a timeline for me mark when did you guys launch the company uh we launched six months ago uh just over so we launched in in the middle of july okay 2018 and how so how you're in the early phases i love this how many customers you have today we have a total of uh what is it now 10 customers okay uh and i said 10 or is it yeah sorry we've got eight customers not quite not quite ten we've got eight at the moment now uh four of them are on the kind of sas model where they're paying they're locked in for a six month period and they're paying a monthly fee to have five or six or seven blog posts delivered every month the other four are um what we call sort of more um ad hoc purchases and they're rather than small businesses they're affiliate marketers so they buy content from us uh when and if they need it okay so there's we've got two types of clients that we're servicing affiliate marketers and small businesses so right now you've got if 1200 people are paying eight sorry if eight people are paying 1200 bucks a month it's about 10 grand a month in revenue but you said half those eight are really on the sas model so what you're doing about four or five grand in true sas that's that's correct yeah you got it um interesting um what you said you focused mainly on the travel niche give me an example of a small business in a travel niche you might write for sure so there's a there's a startup out of san francisco they're called we travel and they're essentially focused on providing a booking platform to i would say individuals and small entities who lack the means to actually invest in a booking platform themselves so to give you a good example we travels prime customers are people like yoga instructors or mba students who arrange events maybe five six times a year but they can't warrant setting up a website and integrating a payment platform for for the that low number of events so they go to we travel and they borrow we travels technology to facilitate the bookings and take the payments for those events and we we write um you know a set of blog posts for we travel every month um how did you get these first how did you get these first eight customers okay so yeah it's a mixture of i'd say growth hacking and uh personal contacts so in we travel's case we already had them as a customer before because we had pitched them uh to write an e-book they were looking to kind of uh launch the kind of thought leadership piece which they could use as a lead magnet and so we wrote a very comprehensive ebook for them uh which they then sort of pushed out through the social how did you figure out the email to say even send that initial pitch to uh linkedin prospecting okay where'd you search for recruiter light travel company uh small travel companies and and the ceos of those travel companies interesting so ceo small travel company uh you get the email the ceo you say i wanna earn an ebook for you here's why you should pay me to do it uh yeah wasn't that specific in the beginning it was more general pitch about who we are and what we can do and then after opening up the conversation we discerned that actually the e-book was the front of their their mind at that stage and did they pay you to do it or you did it for free to try and land them uh no we actually they paid us for it it was quite a large project it took us about three months to write oh wow okay and how much did i pay a fair amount okay like north of 10k uh yes oh wow okay okay and then what after you did that you said hey if you like this you should sign up for our sas product exactly it was like we finished this now but these are the other services we have and this is the sort of value you can get from these services and the main one we pitched was a blog management service which was a white glove service which entails us writing the content and posting it for them so essentially that that entire function is taken out of there out of their lab yeah okay so what's your team size today how many folks three hour time at the moment it's just how many and uh one project manager oh just three of us full time uh it's myself my co-founder and one project manager who we hired uh pretty much when we started or a few one or two months where is everyone based uh we're in cape town and uh my co-founder lives most of the year in guernsey in the channel islands interesting myself and our project manager are down in cape town and are you guys bootstrapping this or have you raised capital bootstrapped bootstrap that's great so are you burning capital today or you're just surviving off the four or five grand you're bringing in from customers exactly yeah just just sort of surviving off of that um paying our employee you know a salary i'm taking a small i would call it a survival salary just to sort of take care of the basic bills i'm actually staying at home at the moment to keep costs down and uh and then hopefully as we scale you know then we can we can obviously start to to pay ourselves a bit more but for the time being that's not the priority we just need to grow the business that's great all right let's wrap up here with the famous five number one what's your favorite business book oh um well i think steve jobs is a biography actually okay number two is there a ceo you're following or studying besides steve jobs elon musk number three what tool do you use to do your billing um we actually use paypal okay and then like do you use like like stripe or quickbooks on the back end um no okay uh we've integrated paypal with woocommerce uh woocommerce okay uh number four how many hours of sleep to get every night seven and a half and what's your situation married single kiddos uh single okay no kids no kids no kids run around cape town that you don't know about uh i'm just messing with you all right and how are you mark i am 35 35 last question what do you wish your 20 year old self knew um i think that uh you know the adage of nothing ventured nothing gained i wish i would have taken a few more risks as a younger person yeah guys take risks early on you don't have to play the safe route come coming from mark who launched his company content elect back in 2018 helping smes mainly in the travel industry right content for customers today paying 1200 bucks a month that's about 48 grand obviously a month in revenue up from nothing a year ago it wasn't launched yet they are operating at breakeven their bootstrap today team of three in cape town uh south africa too early to talk about unit economics but they got their first customer by a cold linkedin search searching for ceo of small travel companies which then turned into an e-book project they got paid over 10 grand for and then upselled into the sas platform all right very good mark thanks for taking us to the top