How Eleapsoftware CEO Don Weobong grew Eleapsoftware to $7.2M revenue and 1K customers in 2018.

hello everyone my guest today is don wilbon he's the founder and president of telania technology software as a service company based in louisville kentucky he specializes in helping organizations solve tough challenges through e-learning technology leaves of absence management solutions and sales channel management his premier product is a company called e leap don are you ready to take us to the top yes sir i am all right what does e-leap do and what's your revenue model how do you make money uh so e-leap is a system that helps companies essentially translate what they've been doing for a long time into more efficient ways to basically train people get more performance out of employees and the way we make money is from a recurring revenue model it's a subscription model software as a service so they pay us every month every quarter every year depending on the contract that negotiated with us we also have an e-commerce channel so folks that don't have employees but want to create content and market i can use our system to do that and so we essentially have those two major tracks a third track is where you have consultants right they work with companies for staff and purposes or whatever and sometimes a client can come in and say well we want to have a solution for training do you know anybody so they will essentially be able to set up your client using our system as a white label and push out the system to the client got it very cool and i don't want to talk about kind of every different customer cohort but on average what's the customer pay you per month for this uh on average we have about a thousand uh per month we start off at the low end of 25 employees which is 125 a month but uh sweet spot is is about a thousand a month okay and that's per kind of company yes okay yes and put this on a timeline for me when you launch uh we launched in october of 2005. 2005. very good and then fast forward to today how many customers are you working with uh we have right now actives 1035 uh active companies okay and those are just to be clear they're actually those are paying customers yes sir okay and so can i multiply that times an average of a thousand bucks a month that would mean you're doing about a million bucks per month right now uh right about that right about but i mean we we obviously um have plans that have negotiated different price points with us so yeah so what sorry so what is your actual run rate today what are you doing per month uh for per month um because we've got the two revenue channels just sas just sas yes the software uh we do about 600 or so a month that's pretty that's that's still that's a healthy sas company there um so 600 000 bucks per month divided by you know 1035 you know teams basically means the average one pays you 580 bucks per month or something around there something yes and what's that sas this part of the company growing at so a year ago today what were you doing per month oh a year ago so we went through a dip with seo issues we were pretty much um holding tight i think a year ago we're at right about four well four or five hundred a month i mean basically we went through we we grew real fast and then we had issues with seo stuff we dipped and then we are coming back what's what's the seo what was the seo issue well a competitor basically um sent a bunch of fake links to us and then turned around and reported us to google and so they looked at it and they're like well you guys have a bunch of bad links and so we're going to manually demo your rankings and we worked with them to remove rank and i mean links and clean up all kinds of stuff and went back to them and said hey we've done our work how did you do that i can imagine if it happened to one of my listeners they would go who at google do i even reach out to to try and solve this ah dude that was it was painful uh i think i went through about three companies before we finally got one that worked out for us um you mean they use you use them to help you get connected to google to fix it yeah yeah so essentially the issue was look you need to go clean up and so it was a manual process and so the issue was who is a reputable company to work with and of course who can actually at the end of the day guarantee that you've done the work and when google takes a look they'll be you know okay with it and so the first company said yeah well i think we paid them it was right about a thousand a month actually to help us do this and then about six months later it didn't happen so we kicked them out got another company uh and then the third one eventually i got involved the process which is really where i started i you know since 2001 i've been in e-commerce in some fashion i worked with go to before google adwords and all that stuff and so i knew about web marketing but so who was what's the name just in case someone else wants to use them what's the name of the final company you work with when they did a good job you know not off the top of my head i can get it for you okay that's okay and uh talk to me about funding so have you have you bootstrapped the company or did you decide to raise um bootstrapped i had initial investors um that essentially just put a little bit in there and and helped us uh get out how much don uh gosh it was very little it was less than a hundred thousand okay so less than a hundred thousand bucks and um and uh okay so you use that money what to build up the initial platform yeah building initial platform marketing sales that kind of thing um but then it be it's been just plowed back um we're able to eventually buy out uh outside uh investors and and essentially you know so you own a hundred percent of the company now uh my wife and i own 100 oh good i love that husband and wife team that's great and talk to me you know churn is critical in a sas business so what's yours just churned today uh tron is i'm looking at my numbers here i think we're looking at about five percent okay that's five percent logo churn or revenue churn per month uh this is this is actual revenue return per month um i'm just looking at my numbers real quick i wanted to make sure i get some reports before i call and you knew what to expect huh i i i've checked a few videos before so do you like the format of the show it's fun right it is great it was fast paced it's good information i'm like i don't want to make a complete edit oh my god i think you're doing great so five percent revenue churn per month which means multiply by 12 that's about 60 percent of revenue churn per year or do you have any expansion revenue um yeah i mean we've we've basically been um saving uh a lot of cash so the reason why is because as a small business we have to be able to take advantage of opportunities so we actually are right now in the middle of the v5 uh belt of uh e-leap system uh version five and that means we're plowing in lots of money into ux and ui and all that good stuff do you have though don when i talk about expansion revenue what i mean is if you look at all the customers that signed up exactly one year ago when their contracts go up to renew do you upsell them anything do you have additional things you expand their revenue to or no yes we do uh so we have content uh also and content model is basically a partnership with our content firm so that we can bring them content that we license um and so we we sell them it's not as as aggressive as i would like it to be um on hold i'll say it's less than two percent yeah okay very interesting and then what about acquiring new customers what do you pay to acquire new customers uh so a model has been traditionally uh we tried to keep it less than 20 cost um acquisition less than 20 of what first year value first year revenue yes sir okay so if your first year revenue is about seven grand on these customers what you're saying is you're willing to spend up to what does that number come out to about 1300 bucks something like that to acquire them yeah right about that yeah and where are you spending that typically uh we're spending that the bulk of it in outbound sales calls uh seo obviously but in my in my experience with just this industry it's been so complicated and well not complicated it's more competitive is what i want to say in terms of seo so we figured out the best approach for us in terms of revenue and just being efficient is to actually do outbound calls um so we're kind of going back to the old-fashioned way doing business and the sas model which wasn't where i wanted to be but we found that this was the most effective way for us to get new revenue so we just call set appointments do demos walk them through the system um close that kind of thing don tell me how you have the structure though so what's the total team size today we are a small company we have 15 people one five how many of them are doing outbound calls uh we've got 10 of them doing about calls wow okay that's a big chunk of doing outbound calls okay and how many calls they make per day would you say oh we've got about or the corporate hour 400 i'm...