How CrawlQ Reached $88K in Monthly Revenue With 350 Customers, Fully Bootstrapped (Interview with Founder & CTO Harish Kumar)

Introduction and What CrawlQ Does

Nathan Latka

00:00Hey, folks. My guest today is Harish Kumar. He's a product design engineer who's passionate to fix poorly defined target audience profiles, notoriously low conversion rates, and a high cost of conversions for SaaS founders and marketers. He's now building crawl q, crawl q. All right. You ready to take us to the top?

Harish Kumar

00:16>> Yes. Yes, Nathan. That's great to meet you and I'm really excited to be part of this podcast.

Nathan Latka

00:22It's great when you too. So if people wanna follow along, what's the URL they can go to to view the company?

Harish Kumar

00:27>> Just crawlq.ai, httpscrawlq.ai.

Target Customer and Product Overview

Nathan Latka

00:32Okay. Who are you selling to?

Harish Kumar

00:35>> We are selling to B2B companies, especially the SaaS founders who are in the tech space. And of course the agencies that are willing to migrate to SaaS. So agencies who are already in the traditional space and they wanted to move to SaaS and we're typically dedicated to helping SaaS founders, SaaS agencies And

00:58>> the main goal or main USP of the product is, as you said, in many times I have listened to your interviews, first build audience, build distribution network and then build your product. And this is exactly the problem we are solving with crawlq and my fellow founders who are busy with building outstanding product. I really wanted to help them. I really wanted to help the agencies who are willing to help.

Nathan Latka

01:22So Harish, just to be clear, so crawlq is helping anyone create content automatically, correct?

Identifying the Niche Audience

Harish Kumar

01:30>> One step before that is to identify your niche audience and that's the USP of the crawlq. And once you have identified your niche audience using AI insights and using AI, then we put our machine into to create content. So content is latter part where first part is to really identify a perfect buyer persona, perfect ideal customer.

AI Stack and Pricing

Nathan Latka

01:52Understood. And you guys are built on top of are you guys built on top of GPT-three?

Harish Kumar

01:58>> We use multiple platforms. We have our own proprietary AI layer that's called Athena. Athena is a smart AI assistant which communicate between user and all kinds of models like GPT-three or AI21, you name it. We have created a layer which is agnostic to the models.

Nathan Latka

02:19Understood. And so what are customers paying on average per month to use this technology?

Harish Kumar

02:23>> On average, our customer pays $250 per month. And of course, for agency packages, it starts around $1,000 per month.

Company Launch and Early History

Nathan Latka

02:32When did you launch the business? What year?

Harish Kumar

02:34>> It was launched in 2019 and the whole 2000 half part of the '19 and '20 was pivoting and experimenting,

02:45>> working together with beta customers. But this year, of course in March we launched in a big way from AppSumo to different many platforms. So it was How many customers

Current Customer Count and MRR

Nathan Latka

02:58are using the platform today who are monthly recurring? So not App Sumo customers.

Harish Kumar

03:03>> Apart from the monthly sort of customers that are on our platform is around three fifty customers.

Nathan Latka

03:11Okay, three fifty that are paying per month and they're paying on average two fifty per month. Right?

Harish Kumar

03:17>> Yes. Yes. But before that, we also have AppSumo customers.

Nathan Latka

03:20Just to finish that thought out. So you're doing about $88,000 a month in revenue right now? Yes. Okay. Very cool. Nice growth. Congratulations.

Harish Kumar

03:28>> Thank you. Thank you.

Nathan Latka

03:30And if you're doing that today, where were you exactly a year ago? Do you remember?

Harish Kumar

03:34>> Well, it was really difficult to tell when we're a year ago, almost we started from zero, nothing. Three, four Well, you

Nathan Latka

03:40launched in '20 you said you launched in 2019. What were you doing in November 2020?

Harish Kumar

03:45>> I was working with five beta customers into entire year, pivoting with them and I did not scale myself to more customers because I got perfectly five different clients or semi or mid sized client and I was fully dedicated to them, pivoting, optimizing.

Growth from Zero to Scale

Nathan Latka

04:01So you had five in December of last year. So one year ago, you had five total customers at $250 Right. A Okay. So you went from $1,250 a month in MRR to 88,000 a month over the past twelve months. Yes. What drove most of that growth?

Harish Kumar

04:16>> That comes from the traction that we built around the unique USP of the product and also our launches on the different places. Of course, AppSumo was the biggest growth channel, but after that

Nathan Latka

04:28How many did you sell on AppSumo?

AppSumo Launch Results

Harish Kumar

04:31>> We sold total revenue of $650,000 on AppSumo gross revenue.

Nathan Latka

04:36And how much of that did you get to keep?

Harish Kumar

04:39>> What do you mean?

Nathan Latka

04:41AppSumo takes a cut. How much of the $650,000 do you make, do you get to keep as a company?

Harish Kumar

04:46>> Ah, yes, right. Of course, know, it's the most. So 110 ks is a net net that came to us after all the commissions from Epsom out of.

Nathan Latka

04:56Yes, you basically made 100. They made like $500,000 off of you. I mean, does that how do you feel about that?

Harish Kumar

05:03>> Well, very, it's not really a good feeling about it, but the amount of traction that we got, the amount of like visibility we got, of course, it was not possible sitting inside the room and not opening our software.

Nathan Latka

05:20So you sold $650,000 worth in dollars, but how many people purchased the AppSumo deal?

Harish Kumar

05:27>> Right now, have 3,500 customers who purchased AppSumo deal.

Nathan Latka

05:32Okay. Got it. And how many of them have you been able to convert to a paid monthly plan?

Harish Kumar

05:38>> That percent is quite low at this moment. It's not more than 3% or 4% to be very Yeah. Honest with

Nathan Latka

05:45the reason I'm asking is it's rare. Very rarely can you convert someone that is a discount shopper on AppSumo into someone willing to pay $200 a month for your plan. So it can be a distraction sometimes to launch AppSumo because then you have all these people you have to support. How do you manage that?

Harish Kumar

06:00>> It's a difficult part. Today only I put in group communication that I missed my eight year old boys teacher reminder three times on a school last eight months. And he was stressed out last night. Was saying, I'm, daddy, I'm really stressed out. You have to really talk to teacher. So it was very difficult and I'll now

Nathan Latka

06:22Sorry, talk to who?

Harish Kumar

06:24>> To my little boy who was eight year old and he was really stressed out because I missed his teacher's call three times. So it was very very difficult time last eight months supporting all these customers. So from today I said no, I'm going to put $269 per call that you are going to book with me.

Nathan Latka

06:44Yep. So this

Harish Kumar

06:45>> is something I had to take this step, but it was difficult to support all the AppSumo customers.

Nathan Latka

06:49Well, that's good. Yeah. Good. Nice, nice move. I mean, you now have three fifty that are paying in your AppSumo, you know, $88,000 a month. You're north of a million dollar run rate now today. Have you done all this bootstrapped or did you raise capital?

Bootstrapped with Personal Investment

Harish Kumar

06:59>> It's completely bootstrapped from my own funding, $350,000 I have already put from last two years. I have sold my house two times, moved to a lower, a smaller house. So I'm fully invested. I have thick skin in this game and it's really, really excitement of building something, but also fully invested myself.

Nathan Latka

07:21You are 100 all in.

Harish Kumar

07:22>> Do you own

07:23>> 100%, Harish? Yes, I own the 100% of the company.

Nathan Latka

07:26I love that. Nice work.

07:30You take all the risk, you get all the reward, right?

Harish Kumar

07:33>> I hope. Yes, yes. That's not the basic idea, but I had this dream of helping and bridging this gap between sales, marketing and product development because I have lived with this frustration for last twenty years, product marketing and sales work in

Churn and Net New Revenue

Nathan Latka

07:50How do you manage churn?

Harish Kumar

07:52>> Currently, of course you can see that 3,500 lifetime deal, they are not going to churn. But the customers who are coming and joining free trial, of course I need to provide them a lot of value and the churn numbers are getting now visible, not that in a significant way. So far I have no So Hariich, way to

Nathan Latka

08:16measure churn is ignore free trials, ignore AppSumo last month in October, take your total paid customers. How many of them stopped paying or downgraded this month, November?

Harish Kumar

08:24>> No, it's not a single customer.

Nathan Latka

08:26Okay. We're five days in, but you get my point. So you have Yeah. Yeah. What was your churn from September to October in terms of revenue?

Harish Kumar

08:33>> As I said, those who joined me paid hardly two or three customers dropped.

Nathan Latka

08:39Okay. So maybe a thousand dollars of churn each month. Yes. Got it. But how much new revenue did you add last month?

Harish Kumar

08:46>> The last month on the recurring revenue, it was, I have to keep all these numbers in my head, but it was almost around 2,500 was the revenue that we had.

Nathan Latka

08:59Very cool. So you add 2,500, you churn 1,000. So net you grew 1,500 in new MRR last month.

Harish Kumar

09:04>> Yes.

Growth Strategy Going Forward

Nathan Latka

09:05Very cool. Nice work. Where do you plan to get new customers moving forward? What's the growth plan? There are three growth tiers.

Harish Kumar

09:12>> One is working with affiliate. Second one is also launching on the different channels. For example, we are going big way in the product hunt that we wanted to get more visibility and traction from there. And the third one is we launched our own inbound and outbound marketing program. We are using our own tool to create very niche specific content dedicated to SaaS founders, agencies and the one I talked about the growth consultant. So their people, business

09:44>> consultant basically or growth consultant. They are my primary target audience.

Team Size and Expenses

Nathan Latka

09:50And Harish, how many people are on the team today?

Harish Kumar

09:53>> We are 10 people on the team.

Nathan Latka

09:5410 people. How many engineers?

Harish Kumar

09:57>> I have eight developers eight developers. One of course, delegated product design for product owner who also do the agile scrum and manage my backlog. Myself, I am also the CTO and main person behind it. But of

Nathan Latka

10:14course So how much do you pay when you add up all the salaries except your own? How much do you pay for headcount right now each month?

Harish Kumar

10:21>> Headcount currently is larger. So still I'm in end up like a run rate of $7,500.

Nathan Latka

10:30So all in your monthly expenses for an ITAAC are $7,500

Harish Kumar

10:34>> Everything everything including my AWS or other type of infrastructure cost GPTD. Counting together 7,500 is the total run rate. I Harish,

Nathan Latka

10:46that doesn't make any sense. Sorry. What do you mean total run rate?

Harish Kumar

10:49>> Like the total amount cost of goods sold plus what I pay to the developers.

Nathan Latka

10:55You're spending your own expenses each month right now are $7,500, correct?

Harish Kumar

11:00>> Yeah. So currently it's not breakeven and you can see it already.

Nathan Latka

11:05Well, mean, if you're doing 88,000 a month in revenue and you're spending 7,500, you're making $80,000 a month in profit right now?

11:17Yeah, yes, correct.

Harish Kumar

11:19>> The breakeven is not in terms of the, so you can see it's the 7,500 is total the expense like every month, the run rate, right? And the numbers that you just mentioned is also sort of not stable because of the last few numbers that you're getting from maximum. The both, you add together.

Profitability Discussion

Nathan Latka

11:47Sorry, sorry. No, no, I don't understand. I don't understand. You said you have three fifty customers who are not from AppSumo that are paying $250 per month. Is that correct? Yes. If I take $250 a month times three fifty customers, that means you're doing $88,000 a month in revenue, ignoring AppSumo. Is that correct? Ignoring AppSumo. Yes. Yes. Yes. Okay. And you're telling me that your all in expenses every month, your headcount, your payroll, your AWS is

12:167,500 per month.

Harish Kumar

12:18>> That's 7,500 per month.

Nathan Latka

12:21So why can't I take your revenue of $88,000 per month, subtract your expenses of 7,500 per month to get your profit of something around $80,000 per month.

Harish Kumar

12:32>> Oh, yes, yes. That will be the true number. I was saying, whatever I have invested, I was also trying to take away from the profit and get the breakeven. So what my definition of breakeven will be at a point where what I have invested so far and what I have earned together should make a net profit. So that was my calculation. So I understand your calculation now.

Nathan Latka

12:54How are you paying 10 people and only having to spend 7,500 per month to do that?

Harish Kumar

13:03>> What do you mean by that?

Nathan Latka

13:05If your all in expenses are 7,500 per month, including paying 10 full time salaries, that means each person is making on average under a $1,000 per month.

Harish Kumar

13:16>> So some of them are really I work with interns or junior people,

13:24>> my out of eight people, my six people from India, so their salaries are of course lower, so I managed completely remote team, I don't have anyone working inside this room, it's all remote team and I always get people who are interested to learn NLP and all those things. I have really optimized this headcount expenses. I have not put expensive marketer or anyone who is asking me $2,500 per month. I get everyone which is under $600 per

13:53>> month which who are working with me this has to that's how I survived. Otherwise, it's not difficult.

Nathan Latka

13:59That makes sense. What are you doing with all the profits? Your bank account is going up by $80,000 per month every month. What are you doing with all that profit?

Harish Kumar

14:07>> Well, have to still recover a lot of debt or the house I have sold and I have my own money. So I have to take back some of money, put back my savings because I have invested my life savings on it for the last two years. And that's what I'm doing, I'm trying to get it back where I have taken out. I have taken all my investments, policies,

14:32>> youth call me and then every investment that I have made, I've completely zeroed out on this. So I'm taking out and making sure that I break even at some point of time where my own investment is taken out from the system.

Nathan Latka

14:46It should be pretty quick though, if you're making $80,000 per month in profit and you've put in $350,000 of your own money, you should get all your money back out in the next four or five months, correct?

Fundraising Plans and Valuation

Harish Kumar

14:55>> Yes, that's my target. So in the March all my investment should be out and that's where I'm looking for an external funding or preparing my company for an external funding.

Nathan Latka

15:06How much do you want to raise?

Harish Kumar

15:09>> At this stage, we wanted to raise around 1,500,000 to 2,000,000. That's what our currently our current calculations are.

Nathan Latka

15:19And if I write you a $2,000,000 check today, how much equity would you give me?

Harish Kumar

15:23>> That would be a difficult question to answer around. I'm looking around the 25 to 30% dilution of the capital.

Nathan Latka

15:32So you would sell, someone wrote you a check today, you would sell 30 percent for 2,000,000, which would effectively be a $6,600,000 valuation.

Harish Kumar

15:43>> Yeah, something like that. Yes.

Nathan Latka

15:45That feels cheap to me. If you've gone from nothing to $88,000 a month in revenue right now or zero to a million dollar run rate very fast, you should be valued at a minimum $10,000,000

Harish Kumar

15:54>> That's close the valuation I have in mind around 10,000,000. That's my valuation. The numbers of course is difficult to arrive at this stage, but 10,000,000 and above is evaluation at this stage.

Famous Five Rapid Fire

Nathan Latka

16:09Got it. Very cool. Let's wrap up with the famous five. Number one, what's your favorite book?

Harish Kumar

16:14>> My number one favorite book is Jim Edwards and he's my famous copywriter and copywriting secrets is the one that I recommend everyone. I have implemented everything what he has said. If you're looking for the book, I have it here in

Nathan Latka

16:29I have it. I have it as well. And then these are also very good books for copywriting.

Harish Kumar

16:35>> Yeah. I have implemented both Jim Edwards and also what you showed the words that sell everything in crawlq with the Very cool. Have you heard about Eugene Schwartz? It's also one of my favorite book. Eugene Schwartz.

Nathan Latka

16:48Of course. Breakthrough advertising. That's like the OG. Let's move forward here. Number two, is there a CEO you're following or studying?

Harish Kumar

16:57>> CEO I'm following and studying. Wow, that's a difficult one. I'm following Steve from Apple. Who? The Apple CEO.

Nathan Latka

17:12Oh, Steve Jobs. You mean Steve Jobs. Or Tim well, he's dead. You're talking about Tim Yes.

Harish Kumar

17:17>> I follow him from his last speeches and those.

17:20>> Got it. Yes. Got it.

Nathan Latka

17:21Number three. Motivation. Number three. What's your favorite online tool for building the business?

Harish Kumar

17:28>> My online tool for building the business is

17:34>> you mean the marketing tool or any kind of tool?

Nathan Latka

17:36Just a tool that you like a lot.

Harish Kumar

17:39>> ActiveCampaign is one of the tool that I really like most.

Nathan Latka

17:43Number four. How many hours of sleep do get every night?

Harish Kumar

17:49>> It's difficult. Five hours of sleep I'm getting every night.

Nathan Latka

17:51Okay. And what's your situation? Married? Single? Kids?

Harish Kumar

17:54>> I have two kids. And married? Married, yes.

Nathan Latka

17:58And how old are you, Harish?

Harish Kumar

18:00>> I'm 41.

18:02>> 41.

Nathan Latka

18:03Last question. What's something you wish you knew when you were 20?

Harish Kumar

18:07>> I was in my 20.

Nathan Latka

18:09Something you wish you knew when you were 20.

Harish Kumar

18:16>> When I was in 20, if I could that time I wish that I should have left my nine-five job, I would have been billionaire by this time now.

Nathan Latka

18:24Guys who would have left this job faster, crawlq.ai, they help you target the right audience and then write great content automatically for that audience. They were doing $1,000 a month in revenue a year ago, now doing $88,000 per month, three fifty customers paying $250 per month on average. He's done all this bootstrapped. He's put in $350,000 of his own money, sold his house twice, but now he's profiting almost $80,000 per month to get all that debt

18:45back and he owns 100%. We love this story. He is all in. Harish, thanks for taking us to the top.

Harish Kumar

18:51>> Thank you. Thank you, Nathan.

Nathan Latka

18:54One more thing before you go. We have a brand new show every Thursday at 1PM Central. It's called Shark Tank for SaaS. We call it deal or bust. One founder comes on, three hungry buyers. They try and do a deal live and the founder shares back end dashboards, their expenses, their revenue, ARPU CAC, LTV, you name it, they share it and the buyers try and make a deal live. It is fun to watch every Thursday one

19:19p. M. Central. Additionally, remember these recorded Founder interviews go live. We release them here on YouTube every day at two p. M. Central. To make sure you don't miss any of that, make sure you click the subscribe button below here on YouTube, the big red button and then click the little bell notification to make sure you get notifications when we do go live. I wouldn't want you to miss breaking news in the SaaS world, whether it's

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20:02are saying. Sign up for that at nathanlatka.com/slack. In the meantime, I'm hanging out with you here on YouTube. I'll be in the comments for the next thirty minutes. Feel free to let me know what you thought about this episode and if you enjoyed it, click the thumbs up. We get a lot of haters that are mad at how aggressive I am on these shows, I do it so that we can all learn. We have to counter

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