How Curaytor CEO Jimmy Mackin grew to $11M revenue and 500 customers in 2024.

hello everyone my guest today is Jimmy Mackin he's the CEO of curator a fullservice digital marketing company focus on helping listing agents get more listings in seven years the company SC over 10 million in annual curring revenue has been featured in Forbes hington post USA Today and other outlets in 2019 Jimmy co-authored exactly what to stay for real estate agents A bestselling book design to help agents with common critical and difficult questions they face he's also host with water cooler over 115 episodes in 8.5 million minutes watched the go-to resource for a lot of folks in the industry Jimmy you ready to take us to the top yes sir excited to be here I'm excited you're here too so so just be clear this is a this is really a service business and you're just now thinking about what to launch in SAS is that accurate well no I would I would describe us as um technology empowered uh Professional Services so we've always been we've always had a technology component a curator in fact I think we initially started probably about 50% of our clients were just relying entirely on our technology uh but over time we've uh We've really focused on the services aspect of the business to help scale and help really deliver value uh the way we think about it maybe it's not traditional for your audience but the way we think about it is not is not software versus Services we think about it as a solution which is how do we use technology and how do we use services to deliver an actual solution for the customers so when it's appropriate we'll use software when it's appropriate we'll use services but at the end of the day it's all about just getting results for the clients and last year in 2020 if you break down your Revenue from Tech enabled Services versus pure SAS what percent went with each so yeah so we uh well when we started the year we were 80% um SAS and 20% services and a huge Initiative for me was to to balance that number out now I know for the VCS who maybe watch these these these shows they're they're going to say it's going to affect your multiple but for a boot Trap Company like our like us like that's not something that's really on our radar so I wanted to get more of our customers using our softare our services so last year we ended with 50% of our customers who have a professional service and 50% who just rely entirely on our Tech platform interesting okay let's just focus on SAS for a second what what was Mr last month um 780 780,000 yeah and how many customers were paying that well we have sorry I'm sorry how many pay you total yeah we have like between 480 and and 500 CLI okay so this is expense I mean uh I mean $780,000 in Mr divided by 500 customers I mean this is this is sort of a midmarket as you know Enterprise he play at $1,500 a month average contract size yeah we're we're a premium service uh we work you know in real estate the industry that we're in the top 10% of real estate agents sell 41% of all homes sold in the US we're not Nathan there's two million agents in in in the US that have a license we're not interested in working with the botom 90% the part-timers the ones that sell two or three homes a year we want to work with sort of the entrepreneurs who actually have a business who are trying to grow who need the support and uh and resources to to make that happen so for us we we focus on the uh what would be considered not even mid-market for us it's really considered sort of the top tier Enterprise in real estate and if you're doing $780,000 a month in Revenue last month where were you about a year ago so we can understand growth well we were probably around the same point um you know when we uh we at our at our bottom during Co gez we got down to like probably $495,000 a month in Mr um and that was obviously on the back of the real estate market shutting down and and we lost a lot of customers very quickly we lost a lot of Revenue very quickly um more on the software side than on the services side but it it it hurt nevertheless um and so what we've done over the last really six to to eight months is get us back to where we really needed to be and focused on everything we could do to innovate to get ourselves in a position where we were essential to the customer uh so we were able to essentially kind of get back to where we were which is like in some respects for us um something we're really proud of and felt like was a massive success yeah how did you do that though did you just resign are you resigning people up that churned during Co or are you getting new customers altoe well so the strategy you know I think a lot of people forget you know what it was like in March because now we're February it feels like a lifetime ago right um but the thing that became so obvious to us the number one lesson we had in Co was very simple is that we absolutely had to be essential we had to be Netflix we couldn't be hulo or peacock or quby you know I saw an article recently on the LA Times Nathan that said uh and I think you got a kick out of this they said uh streaming companies like HBO and Disney are exping this phenomenon called churn and in the article they went on talk about how um you know 46% of consumers in the last months are going to cancel a streaming service and so for curator when we started to think about our value proposition we started to realize very quickly that we needed to get closer to the customer and more importantly closer to the cast register so what we did uh to get us from being at 495 back to where we are today is we understood that we had to say okay we have to innovate and so we had to focus on what is the value proposition that customers really need right now we were primarily marketing but it it had to be advertised in because advertising for our clients uh a much faster time to Value so we we shifted our Focus to entering into the real estate advertising Market which is you know1 19 billion Doll Market the biggest player in the space is Zillow uh they're the dominant player and we said we're going to provide a an alternative to Zillow and we're going to help our clients get an Roi on their advertising spend in conjunction with our marketing services and that was a huge driver of growth for us and and more importantly it allowed our customers to quantify very easily what the ROI of curator was which is ultimately the goal for any company like us okay so $780,000 a month Revenue today about a $9.3 million run rate 500 customers paying I assume you guys are profitable since you're bootstrapped is that accurate yeah so when uh when I took over as um CEO uh when was that October of 2019 um so October 2019 the first three months we were hammering cash we burned upwards I think of around $690,000 in cash in the first three months uh in the last five months or last four months excuse me we've made over $550,000 in cash that's that's L I'm sorry that's great yeah well you know we're really proud of it because it's largely due to just operational excellence just like you know H it's it's the way we think about it is playing offense and defense at the same time you know and I think I think this is again we're pretty simple as a bootstrap company but I think in a lot of cases when you're comparing yourself constantly to other fast growing SAS compan companies you tend to overinvestment of being a bootstrap company is to be conscientious of what is a long-term investment that you can make that maybe or maybe not will play out versus what you know what what do you need to do now to actually make money to keep the uh keep the doors open what what is the economic relationship between you and Chris Smith I believe Chris founded the company what back in 2013 yeah we're co-founders so we're equal Partners okay oh W so he gave you 50% of the company when it came in in 2019 no so Chris so Chris and I co-founded the company together so we were together on on yeah on day one yeah I see I see okay so you guys just split it equal 50-50 day one and then you took over our CEO 2019 yeah so we actually have a third partner at curator so it's it's one third one third one third with the three Partners we have a silent partner who is involved in the technology at the beginning who now Ste back steep back from the business I see so what was a big change in 2019 and you just taking over CEO yeah well you know one of the things that Chris and I realized um well first off I think for anyone who's watching right now who is a Founder uh my advice is very simple is that the relationship you have with your co-founders is maybe the single most important thing that you need to work on to ensure that you can actually build a sustainable business um and the relationship I have with Chris is just phenomenal it's someone who I've always admired and respected and someone who I've always used as a mentor and a sounding board and so in 2019 for Chris and I uh it became really clear and obvious that the company needed a single voice and a single leader and that transition from a Founder to a CEO is a really difficult transition for most people to make you know Founders Nathan you know this already because you're in this space like Founders have all of the power but none of the responsibility or accountability uh and so you know you you you can do whatever you want to do but you're not really responsible to anybody and in in in bootstrap world you're not accountable to anybody except maybe your other partners but even that's not really the case when you become CEO you have to sort of defer the power and defer the responsibility but ultimately you're accountable so for Chris and I it became clear to us that hey this is this is what this company needs to to level up and go to the go to where we want to take it and what's it look like today the team how many folks total we got about 46 people a citer give take and how many Engineers we got about eight Engineers eight any quota caring sales reps or No Yeah we actually have been uh one of the things that I did when we mentioned earlier about uh bringing the um you know having to sort of turn the ship around in 2019 and going into 2020 and surviving covid is I one of the first decisions I made I is I uh basically re assigned our entire sales team into customer service and so we had virtually no salese I was a salesperson right I'd handle sales calls uh which sounds crazy for a CEO to do that but the reality was we had to focus 100% of our effort on getting our churn down making sure our customers were you know ecstatic driving up our NPS d ding up our cat driving up just our overall word of mouth and uh so since then you know once we felt like we really had a grasp on that and customers really began to get value out of curator uh we then began to build a sales team So currently we have two sdrs three sales reps one sales manager so just the three reps carry quota or they all carry quota uh when you say carry quota you mean they have a quota Target their their compensation is based off hitting a quote selling plans yeah yeah so they have they have they they have monthly goals so all five or just just three well the the the the the sdrs are responsible for uh booking obviously uh demos for the sales reps so they have a quota to hit in terms of like demos not a financial quot yeah I'm looking Financial quota yeah so the only only the Reps have a financial yeah yeah okay okay and what I mean look one of the big mistakes Founders make when they look to scale their sales teams especially the quota carrying reps they get the ratio wrong of quota Target to On Target earnings so what do you say yours at what's the quota for those three reps of quota well for the company we want them to really be about 70% right so like if they're each of them are at 70% of their quota then we're going to hit the company goals anything above and beyond that we're we're you know it's obviously grav so what is 100% of quot 100% would be probably about 27 to 30 uh subscriptions a month for us that's roughly 2275 because we've been moving up in price uh sorry I'm not fing 2275 what 2275 a month is our our our base price right so you said our arpo earlier was like what 1,600 1650 so to sign up and partner with curator it's 22.75 per month that's the cost so each rep is responsible for getting 10 deals per month so see you with me yeah so 10 deals is 22,000 in new Mr per rep per month or annualized it's about a quarter million in new ARR uh per you know Clos every month correct yeah and we have six Monon agreements then we go month and month after that but yeah that's correct interesting okay interesting times another 12 yes that's I mean that's aggressive actually I mean if they hit our hitting quota at 100% that's like 3.2 million a new AR added per rep per year but you said they stay at like 70% that's still like either it's a big quot that's a large 2.2 million quot is a big Target for us you know and and you know listen I think in in in the world that we live in when you are when you focus on supporting the reps with inbound leads and and you focus on investing really heavily in marketing um and you focus on building your brand then it's possible right uh if you if if you sort of are forcing your entire uh sales team to be outbound WS or to sort of you know uh kill what they eat um that's an it's an incredibly difficult challenge you know it's not cheap I'm sorry I mean to cut you off we're running out of time but it's not cheap to feed the reps I mean what are you what are you spending on fully weighted CAC to get a new $1,600 a month account when you say fully weighted CAC you're referring to how much is it cost of for us to acquire customer customer yeah yeah you know we we tracked this really recently so this you know may evolve over time but right now our CAC is roughly about $7,500 okay yeah that's not horrible so you're getting like a four five six month payback period something like that correct and when you look at churn in ass SAS company obviously it's critical what's your Revenue turn over the past 12 months it's sort of weird because you recovered a ton via Co but what's that look like yeah I think over the last 12 months super high and then not so high so like in the last like let's let's let's take the last um you know the month of February an example like our our Revenue turn is like 1.7% yeah um the thing that we don't have that we we obviously are focusing on these days is moving towards uh how do we get net revenue retention right and so that model is going to have to evolve this year for us to make so you don't have a way to drive expansion revenue is what you're saying no because we we uh well we did but we don't now because we only sell a single product now um so when we when we when we introduced an expansion option during covid you know we sold that into our customer base and got to 50% of our customers using services but now the only thing we sell is our sort of you know fully featured fully uh full fully Professional Service offering and so there's nowhere to go up at this particular moment obviously over time that's going to change you know pretty quickly we're going to introduce new ways to sort of bring um bring more value to customers and figure out way more ways to sell more things to them but initially we're just starting with sort of a singular product and the reason we do that is to streamline the entire operations from an onboarding perspective from a customer success perspective it's easier to maintain one product although the economics of it obviously are a little more challenging uh at least allows us to sort of get our ducts in a row as we begin to prepare scale what would you value the company at today I feel like this's a question for you Nathan uh I have no idea it's evaluation is a very emotional thing there's no science you know it's everything I read about evalu EV valuations is you know if you're a service business it's it's like you know 4 to 6X Eva if you're a software business it could be 7 to 10x Revenue I think I I I look at our valuation um in terms of the narrative I say okay in our space Zillow is our biggest competitor they're generating a billion dollars in annual revenue off of agent advertising they're moving into something called the flex model which is ESS saying we're going to take some of your commission 25% 30% and we're not going to charge you any money upfront to run ads on Zillow as a result of that roughly a billion dollars over the next five years of agent advertising is going to look to move to either social or search or video there needs to be a company in this space that takes that market and I feel like we're in a great position to do that so love that future but what would you valuate today yeah what would I sell the company for no no no different question because that's very different just value sure it's it's an impossible question answer like it's some I guess I guess I know this is this probably not great for your audience but like I don't think about that like where do I want the company to be like what is it worth today who knows 50 million 100 million 200 million like it's what what would I take for it you know theoretically if someone gave me life-changing money sure but we're a profitable business right what would be life changing money you know life-changing money for for any founder is when you can walk away with 10 million2 million that's that's lifechanging money right yeah you own 30% so post tax that would need to be a deal in the sort of 90 to $120 million valuation range yeah yeah that's but but but clearly like that's not what I'm looking to do um but yes makes sense Jimmy let's wrap up here with the famous let's wrap up here with the famous five number one favorite Business book yeah oh man how the muddy Fall by Jim Collins number two is there CEO you're following or studying yeah CEO um one one that I've been following lately is uh Emily Weiss from glossier I really admire and respect what she's doing over there number three what's your favorite online tool for building the business man section four is a uh educational course by a guy named Scott Galloway and it provides some of the absolute best advice on building a brand business strategy that I've ever ever been able to uh to be a part of so that is absolutely my kind of go-to resource for education for myself number four how many hours of sleep do you eat every night how many hours of sleep yep I got a 16-month-old daughter I still get like eight hours okay that's good the situation it sounds like married one kid married one kid yeah all right and how old are you Jimmy 35 years old take us home what's something been you wishing you when you were 20 yes well let me let me answer that question differently uh I think the I think the interesting question is what would the what would the Jimmy of 20 years from now you know tell this person the guy I am today and I think the advice that person would give me would be uh don't hesitate guys there you have it curator curator founded back in 2013 three co-founders splited a third a third a third they've bootstrapped where they are today just broke a $780,000 a month uh uh thing after getting beat up during Co Revenue dropped down to $490,000 a month but again floating with a $10 million AR Mark serving 500 customers Enterprise motion have profited 500 Grand over the past three months again all bootstrap 46 people on the team eight Engineers with the sales team they are cranking up they're growing fast 24% churn annually about 1.7% last month on the revenue side they're looking to figure out how to fix that we'll see what happens Jimmy thanks for taking to the top all right Nathan be well my friend one more thing before you go we have a brand new show every Thursday at 1: p.m. central it's called Shark Tank for SAS we call it deal or bust one founder comes on three hungry buyers they try and do a deal live and the founder shares backend 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 1M Central additionally remember these recorded founder interviews go live we release them here on YouTube every day at at 2 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 SAS World whether it's an acquisition a big fundrise a big sale a big profitability statement or something else I don't want you to miss it additionally if you want to take this conversation deeper and further we have by far the largest private slack Community for B2B SAS Founders you want to get in there we've probably talked about your tool if you're running a company or your firm if you're investing you can 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