Convertrirevenue

hello everyone my guest today is Andy Fletcher he is building a company called convertor II think of it like a funnel builder using a lot of different distribution channels to drive growth including affiliate launches Andy radio takes the top yeah let's do that all right again good to see you as well so so should people compare this to something like clickfunnels or like a web flow but specifically for conversions uh yeah I mean clickfunnels is definitely here we get compared to the most and we're I mean obviously I think our products better right I mean who want reproduce at their on a show okay well I think the competitors doing better than us likes but yeah we'd better they're the most comparable one also like leadpages Unbounce although sort of like page builders funnel builders that that era of stuff web web flows a great tool but it's a little bit more to like techie developer focused or maybe not developer but like some of the way that they do stuff like doesn't tend to appeal to a very marketing centric customers sure when you came on back in October of 2018 you had said that you'd passed about a thousand customers at that point how many customers are you serving today on the SAS product I say about 1,700 on the recurring and another 700 in phase one of our hybrid funnel so let's just focus on the recurring for a second how did you grow over the past 15 months from a thousand customers to adding seven hundred more honestly more of the same where we remain great at like partnership deals affiliate stuff everything involving humans and just terrible at like paid traffic and stuff so tell me tell me about a partnership deal yeah sure so I mean probably there's a couple of really interesting ones we've got our longest-standing biggest selling affiliate is company called videos that's VI d dy o z e who are that they sell an online animation tool like you upload your logo and then it's like 1200 different animations you can pick from they're doing super well and they they refer basically their entire customer base to us like one big promo a year and they'll do other like drip campaigns throughout the year then we've got another another big deal with the guys behind let's down video videos for a second so how did you get that deal and how do you compensate them for that I said we got the deal through God ages majors need to go before I even started working on convert rhe a mate of mine called said sha who spotted like the original like white boy Londoner it's like knows everyone was like hey Andy I'm meeting up with these guys called Jamie and David in LA and then you should come out have a beer and I never say no to that kind of invite so like showed up had a beer met those guys they seemed really cool and they were doing great stuff this was before they started videos before I started convert rhe we got on really well like we kind of collaborate stab it they're like I helped them out with some tech problems they helped me out some marketing problems we stayed in touch and then fast forward over time like this was talking about three years later as we were doing the original convert relaunch videos had been launched a year before that and it was just such excellent synergy that was where they like really started getting behind the product so I think they've done for for like really big promos and they've sold over half a million dollars worth of product in that time and so half a million dollars with a product how many new customers is that oh goodness so on the affiliate deal that'll be ah like a thousand odd something like that a thousand customers yeah so into the the front of these so the affiliate stuff sells in what we call a hybrid funnel say affiliates can't sell recurring on the front for toffee like they just can't do it no nobody's got any interest in it they need a one-time or sudo one time they took juice earning earnings per click is really what they measure right absolutely so if what we do is we do a 12-month package but 297 and that doesn't recur automatically which lets the affiliates say you know say it's a one-time price you know they still advertise that it's 12 months but it sells to the kind of customer that's just super nervous about like they probably bought a lot of these tools got dinged a year later so they're really nervous about committing thing to things that Auto recur and then over time we work on getting them upgraded onto the like recurring plans that we have which we do really pretty well on so about 40% of people know whoa sorry 40% of people that take the 297 thing just get onto the 297 thing a year later but that's of people that didn't upgrade in the meantime to one of our other recurring plans which is something like 40% of those people take it interesting so when I saw when I put converter II into a H refs to look more about like your SEO strategy I mean you're ranking for very high the first vision for keywords like webinar jeo + WP Commission machine was this intentional or those accidental rankings I say those rankings are you'll probably notice it's not us ranking for it it's like a convert or e sub domain so be like webinar geoconvert recom and so convert or e convert or e just gets tons of link juice from the fact that by default we have a powered by badge which is easy to turn off but if you don't turn it off every page published on convert or e has that link to our home page or the affiliates link link to our home page and then we seem to pick up like the SEO theory right is that subdomains don't get any benefit from that main domain that doesn't entirely seem to be true in our case because we've got we get those rankings for people just register like product name converter calm we've seen that outrank their their own domain some of the time interesting yes so when I soon when I look at your domain rank it's really high 79 on 8 Refs part of that strategy is do have almost a million backlinks you would credit most those backlinks to your powered by badge when people install you is that accurate I would say that and the affiliate stuff so the affiliate link like goes to the home page Google's yeah well renowned for as long as as long as it's not a scam B affiliate program like they do follow those links and so we've got a lot of people out there sharing their their affiliate link that definitely adds to it but I'm pretty sure the bulk of it is that powered by badge doing its thing which again flies in the face of so much like conventional SEO theory because it's all on the same my beard well the same handful of IP addresses in our data centers every single one of those pages but Google seems to love it mm-hmm ya know it makes a lot of sense okay so that's the kind of the SEO strategy and the affiliate structure you mentioned so just to wrap that up videos if they've driven you $500,000 worth of convert recut you know a thousand customers what percent will you pay him of that is it fifty percent as they get 50 percent of the like 50 percent of everything they sell on the day so that's the 297 front end thing just I just pull this go to feed the things I'm talking about here we're going away literally next Tuesday so that's fine we're changing our prices I just AG I'm sure this show will go out after this so don't want it I can still learn they can still get the same strategy themselves so they may be affiliates someone anyone coming knocking on my door going where's that thing you were talking about because yeah anyway so that anything we stay sell on the day so the 297 on the front end the recurring up sir which is 37 bucks or 97 depending which thing we're selling to a given audience and as agency or Pro they get 50 percent of like for the month one and then anything recurring they get 30 percent of if the stuff that we then sell if we sell somebody on to a recurring plan like nine months later or if we if they don't take recurring on the day and we have to sell them the plan again in 12 months time we don't pay commission on that that's like all priced in at that point sure sure so I've had a high-level anything that video videos drives you and is included in the first cart checkout like the average cart value is 297 plus 37 a month or 97 a month they're getting 50% of or they got percent as that that's correct yeah and then if you upsell them or if they UPS or whatever there's you know up to potentially 30% paid out to that affiliate after the first month yeah that's correct in perpetuity yes interesting that can heat yeah I can eat your margins yeah so it's trading off against like affiliate recruitment spend so it's it works really well for us because basically the big affiliates in that kind of space will look to do one big promo for a given partner every year and it works really well to have those recurring commissions still being paid to them like clockwork every month because then when you hit them up in a year's time you're like we remember making a lot of money want to do it again like the first thing they do is they go and see how it went and they look holy [ __ ] we're still getting paid for that and they're just so much more likely to come and play so what is the average crust we're now paying you per month last time you told me your RP was about 46 bucks it's a good question say we're on we've got far more front door people now which is like 69 a month for the pro plan we did we don't see many people take standard or agency so we model it on that and then a chunk of them are on 97 from the agency offer or 37 from the pro offer and I honestly couldn't tell you what that like averages out to well so if you have 1,700 customers like what what Mr D to do last month and we can divide 1,700 into m RR so we track our we've got a bunch of annuals as well so we track our IRR rather than mrl feel free to divide by 12 yeah at one point like oh five million okay got it got it so that would mean our poo is about 50 bucks on average $50 for 70 in our customers that are a million dollar run rate today that's great so have you have you chosen to raise capital or driving this growth or still bootstrapped I still bootstrapped haven't raised any capital since the first light I put about 80 and okay mo money in day one thing I did although and since then we've just been profitable and growing offer growing off the money we make I love that it's a way to do are you reinvesting everything or or how much cash would you insert our profit so we keep we've got really lucky in that regard actually my business partner and I have like we don't we take an okay salary like we don't cash out loans we have fair like it's frugal for London lifestyles like that's not still expensive right but we've we've left a lot of money in the company so at the moment where everyone else is kind of a bit over stretched and like taken maybe a bit too much VC capital which is fine if you're getting to your next round but with the world going to hell it's all all of their scary we're bootstraps we've got a big war chest where we match our like the money we spend on servers people infrastructure ads like anything that I'm paying every month we try to keep that roughly matched against the amount we have coming in every month and then there's plenty of one-time money out of those deals and everything else but Neil and I take some of yep okay so it's so generally profitable but reinvesting to the extent that you can whether its annual upfront payments or things like that but reinvesting since you can into new product features you know new affiliate deals things like that yeah absolutely like we're not taking taking masses out at this point what's the team session what's the team size to like 20 people 20 people okay so five more from Latimer chatter how many engineers and so like four engineers one dev ox we've literally just hired like three four weeks ago a head of engineering kind of try and take some of that off my desk we're starting to like build out that management team so here's the magic question click fellas has this as a massive issue as well churn so last time you came on I mean you told me your churn was a real problem like should churning you know a large percent to the customer base each year what's your gross revenue turned today look like yes I actually you you really helped me with that last time okay that's good I know I should have charged a consulting fee so yeah at the time I remember we are churn if we because we just we looked at churn across everyone at that point and that turned out to be really dumb so what you basically said is like finer if I find a line after which like churn is more stable so we basically we looked at our numbers and this we took the three month line so a whole tons of people cancel in those first three months and we just treat that money is like they effectively paid us a one-time fee to do an extended trial and then didn't take the product then we look at churn churn as anyone that stayed on after three months and I'm sure there's some people that buy it forget to use it just pay any tax for five months then cancel it but the majority of people if they're still on like a Bastardo month for their invested they build pages they've driven leads and I turn on those is really good like it's like a percent or two a month okay so ii took a survey caught maybe twenty four percent max per year if people stay past that three month mark yeah absolutely as i say it it's some of it is obviously playing with statistics but it's it just seems like a more interesting number like somebody that's used us for six months bill like three funnels driven 10,000 leads and sold a whole bunch of product like if that guy leaves like we screwed something up sure yeah yeah i mean look this is especially when you have a top of funnel model that is that relies on affiliates you're gonna have a lot of churn and that has very little to potentially with your product it just based off the quality of customers that that's they drove you and so doing yeah and so like doing what you did is i think a better way to just measure our attention over time so yeah okay good that's good you know so so that looks like that's improved and then so talk to me a little bit about any other customer acquisition strategies besides the affiliate launches or is that the prime one well say this is the cool thing that's like going live at the moment we've been trialing this for the last couple of years and we're about to roll it out with a whole bunch of different partners so we've been trying it with the guys from they're cool they're six figure mentors digital business laughs what is it so they've recently launched a social networking site for no no what what's the thing you're testing with them so it's a reseller deal where basically they get to put us in their funnel but it's a it's a co brand it's not a white label deal so people still log into a buck converter calm the knowledge base is still helped on commercial comm people still email support convert or comm for help but they get to collect the money and then remit to us like invoice marketing basis then waste out what's the URL of their website so they're if you go to mentors comm this is the main thing that they're but they've integrated us into you got it so if I buy I'm on mentors come right now if I bought it says coming said wait so it's not wide that says coming September 2020 yeah I think that's a little bit of like make you want it more strategy like there's a back door somewhere I can't remember where it is okay but I log in and purchase what you're saying is I will see converter e somewhere as like hey if you like mentors buy convert rewrite now yeah so like a lot of our training is in like the training area then we're like the the only approved funnel builder flipper system is like you know you're welcome to talk about click funnels in the group if you want but we use this you should go and buy this and like get it get it through our setup so when you when you buy through them you get some like a bunch of their training products conversed into funnels in convert tree like just kind of waiting for you Sam same model you're gonna pay them 30 or 50 percent upfront and 30 percent perpetuity that's NDA I'm afraid I can't tell you that it better better or worse deal than the regular fee sorry that's I'll tell you like 98 percent of my numbers that's NDA with everyone we've signed it and by their request not ours so yeah I mean I would argue probably what happened there is they got a better deal than other folks because it's they have larger a larger audience than your potential other affiliates in the last thing you'd want is your other affiliates to start asking for a larger cut as well so so mental like one thing I can say is mentors become definitely got the best deal yeah because they've been trialing in that other company for the last two years so like they got it cuz they got him first everyone else that's taken is all the same yeah but I can't tell you what that is that's okay um have you looked at doing are looked at raising any sort of even if it's not equity but like raising any sort of capital to fuel growth and just drive growth faster or no honestly we'd like about twice a year my business partner Daniel and I sit down and talk about it because it's like you know who doesn't want more money right yeah but at the moment we're sat on I think we've got about 700 K in the war chest yep so like we could probably like with somewhere between like a seed and a series a I don't quite know where like I'm sure we could raise a million or two if we wanted to fit well with pre-pandemic we definitely could have good news things all the markets like at the moment well the bigger question is what would you do with capital to drive growth if you had it not how much could you raise and and that that's the that's the key thing that like we're we're super good at turning elbow grease into deals into like affiliate partnerships reseller deals like we we were good at that going in that's what like let us start the company we've got really good at it as a business over time I still don't have a magic box that I can just put money into and get more money out of yeah how many affiliates are you currently working with in other words you pay them at least a dollar and Commission each month uh if the bar is a dollar then God dozens over 100 goodness knows if the bars like two dollars it goes down cook well it goes down pretty rapidly okay it's Jamie nning for affiliates do you have each month you're paying okay interesting alright let's wrap up here Andy with the famous five number one favorite business book ah favorite business book at the moment goodness the column the name of the book the Andrew something the CEO Intel wrote like he's won an only book management book I can't believe I hadn't read it read it recently was amazing and I'm bummed like I should remember the name of that damn book high output management that's the one thing yeah yeah with any growth number two is there a CEO you're falling or studying this Jason Lemkin count of course sure no three what's your favorite online tool for building your company uh JIRA number three or four how many hours of sleep eat every night uh that's good and what your situation married single kids I long time okay no kiddos running around no all right how are you thirty-seven last question anybody was your 20 year old self Neil uh take more risks like and just the I think I said this last time even like nobody knows anything like twenty-year-old me was convinced that other people had it all figured out and I need to know what they did 37 year old baby knows we're all making this up as we go along guys there we have a so can virtually guy that might see not there you go guys there you have it convert RIA final build or they've passed a million dollars in terms a run rate up from half a million just about a year and a half ago they're also profitable in bootstrap seven or thousand dollars sitting in the bank nice warchest to work with here during the virus obviously can do to be profitable twenty people on the team five engineers churn it's on a twenty four percent annually they've improved that year-over-year they're number one go to market strategies paying affiliates a lot of affiliate deal is where they'll pay fifty percent up front and then thirty percent in perpetuity for all those customers the affiliates close Andy thanks for taking us up cool thank you very much for having me Nathan you have a good day