Directual Revenue & Valuation (2024)

hello everyone my guest today is pablo earthshop he's building a tool called directual.com it's a low code platform for building sophisticated applications all right paul you ready to take us to the top thank you all right so tell us about directual obviously no code is a very hot space right now who's paying for this platform yes uh absolutely that is a hot topic but we shall distinguish there are low codes no codes very simple tools for building simple websites landing pages and low code mostly local tools for building complicated tools and for them the the main stakeholder the main player is it department of the company so describe are you focused on any specific niche e-commerce sas something else uh no uh we are creating general purpose uh no code platform and basically we are focusing on backhand development so we are covering perfectly all the issues connected with the database user administration backend logic so we are great with that okay and what are customers paying you per month on average would you say uh there are two groups of customers the first one more significant they pay thirty dollars per month they are uh indie developers startup founders just just people who are building uh small applications mvps or startups and uh the other group of customers they are paying 300 and more they are companies small and medium companies and uh web development students okay and and how many customers are you working with today today we have about 2 000 users uh in our source version 20 customers small and just six customers large that is why we went public just in april 2020 this year before we worked with enterprise customers and most of our profits were for services so we decided to pivot to purely sas model and what is sas revenue per month today uh today is about 2k monthly and we are going to reach at least uh 10 or 15k mrr by the end of this year so 10k monthly means you have about three 200 or 300 customers paying 30 bucks a month uh we have uh no no we have more um revenue from services so we still have revenue from services from our enterprise clients and nowadays we have about 2k per month sas revenue i see got it so you you have about then what how many customers do you have on the sas platform 70 80 90 uh about 50. about 50. okay great so walk through this transition this is a beautiful moment where you go from service based revenue to launching a sas platform and it's not always easy when did you make the decision to launch the sas platform uh so the decision was really tough because we had been developing this enterprise business model for years and moreover we attracted some funding from one of our enterprise clients he invested in that model but it turned out that the selling period the pre-sale processes all the pilots or were too significant and we needed too many people for the projects and uh the profits were were not enough so uh how much how much profits were you doing on that model so uh the turnover in 2019 was about half a million dollars but at the same time the costs were about half a million dollars the costs for people and that is why we had to decide to pivot to purely cells we dismissed our project services teams we kept only engineers and we almost started from scratch but thanks to that significant history with enterprises we had a technology very good technology but on the other hand uh that was not simple enough to provide that technology on the sas model so now we are working hard on make it simpler so our early adopters is providing us with a lot of information about uh about places where they got stuck so pavel you mentioned one of your early enterprise customers invested in the company how much have you raised total to date uh i could not disclosure that uh so i'm with the nda sign but that is about 1 million okay so you've raised a million dollars so far and um how many people are on the team now today four people four people and all of you are engineers yes all the all the engineers there were about 40 people in a service company so we dismissed all of them how did you pay even when you were building that in 2019 how did you pay 40 people with just 500 000 in annual revenue uh we are in russia the salaries in russia are lower than in us much lower got so you're paying like 700 800 bucks a month something like that sometimes even less wow i want to move to russia so that is why we have kept our headquarters in russia we kept our engineers in russia but nowadays we are working worldwide we have clients from all over the world the u.s europe does it make you so you've raised a million dollars and in order to get a return for your investors on the money you've raised you've got to grow much bigger than two thousand dollars a month in terms of software revenue how how i mean does that ever worry you does that concern you at all uh it did but we made a decision we came up to the decision with our investor so he saw their situation with their enterprise business model and he approved our decision to pivot so he still is a shareholder in our company and that that company is supporting our our way towards sas model very good how how did you get these 70 customers on the sas platform so that is a great question because we tried to buy some facebook ads and that worked worked not so well as we expected and their two channels that really worked out turned out to be the first is their posts on media for example on hacker noon on dev.t.o so they're just their blog posts with how to create something on direction and the second channel is a communities there are a lot of no code and zero code communities uh you've mentioned that the topic is very hot and those communities are pure each and every week new community there are no code lists some directories of articles and we are working with them we are providing them with some tutorials webinars and that is a great channel for us how are you is there any tool you're using to go find these communities uh so some communities have found us by themselves and uh others we found via google so we are googling no code communities and there is a list that's great and so when you do a webinar with a no code community do you give a revenue share to the community organizer uh yeah we are providing them with a special reference link and thirty percent of uh for the first year sub subscriptions uh are for the partner so that is a standard model okay interesting very cool and do you feel like this model can help you grow to 10 20 30 000 a month in revenue yes i do believe in that and moreover we are aiming to develop our own community uh community of director developers who will support newcomers because they're the hardest thing for us is to help the people to overcome their the threshold it it is not super easy to use our platform it is complicated it is not vixx or something similar so community here could help us significantly okay pavel let's wrap up with the famous five number one what's your favorite book the favorite book the business book any book uh okay let it be the very vivid book uh by felix dennis how to get rich number two is there a ceo you're following or studying yes uh there is uh the true entrepreneur richard branson number three what's your favorite online tool for building your company uh say dropbox and dropbox paper number four how many hours of sleep do you get every night from seven to eight okay and what's your situation pavel married single do you have kids single and as far as i know no kids and how old are you 33 33 last question what's something you wish you knew when you were 20 years old uh that i should invest into bitcoin some years later bitcoin just popped last night folks over eleven thousand bucks pavel's commodities building directual which did 500 000 in top line revenue in 2019 as an agency with 40 employees he laid off 36 of those employees is now pure sas serving 50 customers doing 2 000 a month in revenue and scaling that by doing white label webinars with other no code or low code community leads he thinks he can scale the business to a million dollar run rate using this go to market strategy we'll see what happens pabel thanks for taking us to the top thanks for having me