How Crowdcontrolhq CEO James Leavesley grew to $3M revenue and 150 customers in 2019.

hello everyone my guest today is james leaves he's a strategic thinker founder and ceo of enterprise social media platform crowd control hq they've taken the initial concept through to commercialization driving sales and securing three rounds of investment and successfully securing contracts with blue chip names across both the public and private sectors james you ready to take us to the top absolutely all right what's the company do and how do you make money so we are uh enterprise social media management company so enabling big organizations uh to capitalize on social media as an engagement channel with their various different audiences so this could be from trouble agents through to retailers through to law enforcement um as as well as government so should we think of you almost like a sprinkler or that kind of market yeah exactly yeah but very very similar and you know yeah we compete with all those uh kind of the major players why are you winning contracts over sprinkler are most your folks based in the uk and you're winning the uk contracts or what yeah so i think i think from our perspective what we've done is we've really got to understand the complexities of you know large organizations and actually as a result you know we've tailored our platform to be able to cater for that customization workflows etc etc and i think that uh there is definitely a place for the fact that we're uk based so we've got people on the ground here and we really understand the market you know so everything through from sales all the way through to implementation help me understand i know you have a bunch of different customer cohorts but on average what's the customer going to pay you per month for access to the software oh that's a really tough question uh it's based around users so um you know it could be anything starting from 100 pounds a user you know down to you know 10 pounds a user for you know the very very large enterprise rollouts okay what i'm trying to do is get into and it can be a range which is fine are we talking accounts you're going after that are 100 000 year accounts a million dollar your accounts 10 grand a year accounts generally what kind of field are you playing in yeah so it's it's probably between the the five and fifty grand a year so it's that sort of magnitude okay got it and and uh is the only pricing axis that kind of differentiates a five grand a year user versus 50 number of users uh so they'll be based yeah it'll be based on the number of users exactly okay so you don't have any there aren't any other pricing axes like number of feature add-ons or any other value-based pricing no what we found here in the in the uk is actually simplicity is key so so people want access to a single platform um they may not use all the features from day one but actually all of those features are available so that the organization can actually can kind of progress their social media um in a controlled and you know manuscription when did you launch the company what year uh so we are now eight years old okay so that would be 2010 correct okay and you mentioned in the bio you've raised capital versus bootstrapping how much have you raised to date so be in terms of dollars a little over two million dollars okay a little over two million and why raise why not bootstrap um yeah pretty good question um so i think it was uh i think it i think we had in the early days some you know some some very big uh some big ideas um so we didn't want to launch just a single feature test test that actually we sort of really because we understood that we always went after the the enterprise market they actually had more complicated uh requirements so as a result you know there was a much greater uh requirement for development resource and that's what we primarily put most of our money into ice and what's the team size today so we are a little under 20 people okay how many developers uh so we are so that's half a team oh wow okay great and where's everyone based so we are all based at birmingham okay so okay yeah you see in the uk yeah people i i we were joking before the call i was saying no way that accident's from birmingham out of alabama uh okay good so based in the uk and again launch 2010 so you're eight years in how many customers have they scaled to today so we are about 150 okay and what's the playbook look like i mean how are you getting these new accounts what's what growth channels are you using so uh i think social media is or social media management it's still relatively a new thing here in the uk um you know organizations are not kind of necessarily mandating it as a way of controlling their channels so lots of organizations for example are just having direct access to the native channels so so actually everything that we do is or not not everything but i'd say 90 of what we do is actually is outreach from uh from the sales team that we've got i see okay so using half of your 20 are developers how many are out sell sales people marketing so that would be seven okay so that's the majority of your team there um interesting and then i mean can i multiply right so 150 customers minimum five grand a year that puts you guys at what about 750 grand a year right now in revenue or north of that yeah no north of that i mean i think i think when we talked about scale we were talking about between between five grand and uh and and 50 grand a year so you know it probably sits somewhere in the yeah the average being circa 20 grams something like that okay good okay well look i mean if we if we update the average from i just took the minimum because i wanted to just give you credit right but if we do 20 grand instead that would put you more at like a three million run rate today yes yeah and what does growth look like so if you're doing you know 250 grand a month today where were you a year ago probably half that okay great and has most the growth come from expansion revenue into old accounts or brand new customer editions uh so i would say it's probably 80 20 so 80 is new business and 20 is existing uh um his existing expansion who in the team of your seven marketers and sales people who is responsible for driving expansion revenue um so so actually we kind of split this across um to the customer success managers so so these are the people who are actually actively looking after customers really understanding what their their needs are and um ensuring that they're utilizing all the kind of uh full features of the platform and also sharing ideas um from other clients be their case studies or kind of just uh kind of best practice so we're trying to influence in that way and obviously that is then supported by the marketing team but but a lot of what we do is because their larger accounts is very much kind of people based people focus so which is the role of the customer success managers do the customer success people carry expansion quotas um so uh so yes and no um so it's not one of their core objectives but but actually it does sit there because we're we're not just trying to sell things too it's just not required so it's very much around you know the customer needs and and the customer needs then obviously then drive the uh um uh obviously the expansion yep no no yeah you wouldn't obviously try and just drive the sale but by nature if they drive usage they should also be driving expansion if they're directly correlated correct yeah interesting churns obviously critical in a sas company what's your turn today and how do you manage it so churn is less than 10 okay annually yes yeah uh and that's logo churn or revenue churn uh that is revenue share return okay so less than 10 revenue churn and that's gross or net uh that is uh gross okay so when you add back expansion revenue are you above 10 100 retention yes okay that's great because you told me your expansion you said is happening about 20 as expansion and if you're churning only 10 so net retention would be about 110. yes correct that's okay look that's i mean that's healthy that's interesting um any other plans i mean over the next 12 months are you gonna go out and raise additional capital drive additional growth what's the plan for the company to drive you know double it triple it so i think at this stage there's so much to play there within the within the uk market that you know we've considered overseas expansion but actually i think we keep pulling back from that just because of the resource required in order to go into new markets so so it's very much about uh investing in uh investing in the sales team investing in our marketing to build presence here in the uk so at this stage we have no plans for raising future uh further capital and talk to me about about cac so to get a new 20 000 acv account what are you spending on cac typically um so yeah very good question um so the uh so i think you know we're we're you know it's circa kind of twenty percent something like that okay so you're willing to spend 20 of first year acv on acquisition yes it's about four grand yeah that's great and these accounts are they paying the full first year acb up front so is your payback period instant or no it's more like four or five months um so i think that depends on whether or not uh so the majority of our accounts are bill annually in advance so uh but obviously when you get a cash tends to be you know kind of three months in you know depending on the size of organization that you're dealing with yeah very very good james interesting let's wrap up here with the famous five number one what's your favorite business book um good to great number two is there a ceo you're following or studying uh probably probably was i mean he's no longer active but you know i was a big fan of uh jack welch yep number three what's your favorite online tool for building the company um wow yeah good question uh so so we're uh our predominant legacy's hubspot okay number four how many hours of sleep do you get every night um probably six okay and what's your situation married single kiddos uh married wife lover to bits uh no kids no kiddos and how old are you so yeah very well how how old are you how old am i yeah yeah i am 45. 45. last question what do you wish your 20 year old self knew um wow yeah that's a that's an interesting question um i think uh i think it's about resilience you know uh the the yeah the journey to building a company can be sometimes rocky and i think it's that you know you just have to have that belief in yourself um and belief in what you're doing and don't deviate from that so um and i think that's probably the kind of biggest lesson that i would have given to myself guys be resilient founded crowd control hq back in 2010 it's social media for enterprises 150 accounts right now pay and call it 20 000 acv so do about 3 million bucks in terms of run rate that's up from 125 000 bucks a month just a year ago so nice growth two uh two million dollars raised team of 20 between the uk and other locations less than 10 revenue churn per year 20 expansion so 110 net revenue retention annually 4 000 bucks to acquire a new 20 000 account so about a four-month payback period there healthy economics james thanks for taking us to the top you're welcome