How Erxes CEO Mend-Orshikh Amartaivan grew Erxes to $816.1K revenue and 15 customers in 2024.

hello everybody my guest today is mj ahmed thaivan he's a social entrepreneur and the co-founder and ceo of irks's inc an open source uh growth marketing platform marketing sales and customer service platform designed to help your business attract more engaged customers he's passionate about social entrepreneurship and possesses a strong desire to create new solutions to social problems and then implement them on a large scale to change society for the better mj are you ready to take us to the top yep okay pronounce the name of the company again for me and then spell it because it's very i think it's very difficult okay it's called ergsis e-r-x-e-s okay by the way i just feel like that's like a really tricky name to like say over the phone or get any viral kind of growth word-of-mouth marketing on do people have no problem spelling that sometimes okay okay but it's irx's dot io right all right very good tell us what the company does and what the business model is how do you make money okay so company is building the open source growth marketing software so it's basically uh open source of hubspot and i would say in two weeks we are launching our cloud version okay so just to be clear you've got it's kind of open source right now version of hubspot how are you making money is it is it a sas platform currently we are just charging from enterprise customers for develops and customization etc and in two weeks we are planning to launch our sas version okay so right now it's more like agency professional services work yep okay and give me a sense of how many how many customers are you working with right now in that what kind of revenue model currently we have 15 enterprise customers including bank insurance company and construction company okay and if you look at the revenue from those customers over the past 12 months so throughout 2018 about how big is the business we are really kind of growing very slowly uh we i think in january we have had around uh eight eight enterprise customers and we just closing one or two customers a month yeah okay it's not really kind of our focus to uh closing the more enterprise customers we are more focusing on building the sas version yeah mj i understand all that my question though is in the past 12 months about how much revenue did you do and then i'll move we'll talk more about the sas thing you're building right so um i would say uh our arr will be 360. okay so you did about over the past 12 months you did about 360 thousand dollars selling kind of one-time professional services to about 15 kind of enterprises right yep okay very good why did you make the decision to move or are you making a decision to move to a sas model i mean uh first of all as an open source i would say um martech is kind of very high very expensive products in the market like hubspot intercom etc i mean first chat it's such a thing so we decided to kind of letting this uh business model as an open source we're building for vision and community driven ecosystem where for every startup and uh founders from emerging countries can just easy easily use yeah for the size i mean it's really makes sense that becoming the product company not just being this service company okay so you're you're really moving to a sas model you're updating your pricing uh it makes sense why you want to do that help us help me understand kind of how you're building us what's the team size look like today currently we have 25 people mostly engineers and based in mostly in asia now yeah okay 25 people mainly in asia and are you burning capital right now or yeah i mean up until this point we have 100 bootstrap and currently we are burning around 30 29 uh 700 okay a month 29 700 right okay so where if you're if you haven't raised money but you're burning about 30 000 in cash every month who's making up that difference are you putting in your own money every month oh i mean i would say we totally kind of bootstrapping from the beginning so it was totally uh cash positive well you just told me you're burning almost thirty thousand dollars right yeah we also uh earn 30k a month oh you're okay so sorry you just get you gave me gross burn not net burn so your bank account is not going down by 30 grand every month right no i see i see good okay so you're operating at break even right yeah got it very good um and then 25 developers you said mostly in asia how are you so just to be clear if you're doing 360 grand in a r that's about 30 grand a month in revenue that's enough to pay 25 people you're paying them on average less than almost a grand a month yep that's is that just because asia has really smart people willing to do cheap work yeah [Laughter] i mean yeah but it's our dream to become of course based in the bay area and you know raise the capital and scale fast why is it your dream to be in the bay area and raise a bunch of capital there's a lot of companies in the bay area that have raised a lot of capital that are broken about to go bankrupt um i mean true i'm originally from mongolia and it's been eight years i would say i mean my first application to yc was in 2011 and then since after that we've been you know building a lot of products sending application at the same time we were trying to you know do the client work and stuff like that so that's pretty much uh yeah hard work yeah okay that doesn't answer my question though why do you want to move to the bay area and raise a bunch of capital uh i would say um their biggest reason is uh in my country there is i.t is really kind of uh under valued and there are so many mining companies are eating our country and then there are no youngsters actually having you know someone who look up and think of building maybe a tech company or becoming one of the you know ceos they think of more likely how they could become a truck driver or something so sorry mj you're not answering my questions so why would you want to move away from that in other words you're you're someone that's doing something different in your country you that means you have you can attract more talent you have less competition there's not as many software companies you're competing with for salaries my question is why do you want to move to the bay area and raise a bunch of money um i would say it's not the um i mean kind of the wish we want to do it's i think you know being in the bay area and raising the fund and it's it's startup stream right and i want to make the foundation right and scale fast but you understand you doing that all of your costs a lot of the advantages you currently have then disappear your costs go up you're hiring a competitive environment i mean there's a lot of there's a lot of reasons where you are now you have a lot of advantages true i mean yeah i mean our core culture can be just uh remote only yeah so many companies are let me shift back to the op let me shift back to the open source model so so when did you launch the the first piece of kind of open source code i would say um mid uh 2017 okay 2017 and how many people do you have using it today free or paid i would say over 500 in 50 countries okay so over 500 companies using it yup okay why so most open source models that start open source i think wordpress there's some cyber security companies that started open source i mean they hit millions of users before they started thinking about a paid option why why do you only have 500 people using open your open source code yeah i mean that's one of the things we are lacking now you know kind of trying to build it now we are lacking uh trying to build an audience and engage with the developer community yeah well that's because marketing and development don't are not usually the same person there's very few marketers who are also developers so it's a difficult sale for you yeah how do you bridge that i mean you have to figure out that mousetrap if you want to go big true um that's that's that's why i'm really with you [Laughter] you want me to sell your product i want i want 20 mj why not all right very good and um give me a sense uh give me a sense here of growth so you said you launched december of 2017 um uh you so you've been in business for about what 13 14 months yep okay or sorry sorry 24 months yeah yeah a little over two years yeah okay and you said last year you did 360 grand about in sales what did you do in year one you remember um so i mean uh uh for enterprise customers are mostly for you know sustain it's just for it's not about we're trying to build or you know scale up in all the asian countries or trying to build enterprise customers we're just kind of sustaining and then we're focusing on the sas model yeah sorry i totally understand that i get it my question is very simple first year how much cash were able to bring in doing the professional services work for enterprises i'm not sure about that number like less than 100 000 you think yeah i would say okay interesting all right very good um well look i hope i hope the sas launch goes well you should come back on once you get it going and we'll touch base and see how it's going but for now let's wrap up with the famous five number one what's your favorite business book uh i would say drive down pink drive by daniel pink number two is there a...