How eWebinar Reached $500K ARR and 550 Customers With Two Founders and No Employees (Interview with CEO Melissa Kwan)

Introduction and Bootstrapping Philosophy

Nathan Latka

00:00Hey folks, my guest today is Melissa Kwan. She's the co founder and CEO of ewebinar, an automated webinar platform that saves people from doing the same webinar over and over again. She's a third time Founder, Bootstrapper, and Digital Nomad. Her previous company, Spacio, was acquired in 2019. Melissa, you ready to take us to the top?

Melissa Kwan

00:17>> Yeah. Absolutely.

Nathan Latka

00:18That previous company, did you bootstrap that one as well?

Melissa Kwan

00:21>> I did. Nice. It was much fun.

Nathan Latka

00:23I was gonna say, so have you do you have the yin and the yang? Have you raised on one and then bootstrapped the other? Can you compare?

Melissa Kwan

00:30>> Well, we have never raised venture capital. I mean, had some like family and friends. So, I mean, do you consider that bootstrapping?

Nathan Latka

00:38Mean I consider bootstrapping. Someone to me is bootstrapped if they're very capital efficient, which means the way I measure that is you've raised less than 1x your ARR.

Taking Outside Money and the Lesson Learned

Melissa Kwan

00:48>> Yeah, absolutely. So I've never raised venture capital. I actually, my LinkedIn post today, the title of that is I once took money from an investor and it's private investor. He invested about $250 ks and that made me realize the only person who needs to give you money is your customers.

Nathan Latka

01:06This is in Spacio?

01:08Yes, it was. Okay, come on. Give us a quick detail. What happened? What did you like not like about it? Not, not, nothing against this person, maybe personally, but just in general.

Melissa Kwan

01:16>> Yeah. I mean, it turns out Nathan that there is no free money. And so it turns out that when you take someone else's money, you are responsible for reporting to them and all these things that you didn't have to do when you were truly your own boss. And I don't think people realize what that means. I didn't even take venture capital. I had nobody on my board and it was still an added layer of pressure that

01:42>> I didn't have. And while bootstrapping is extremely difficult because I'm also doing it now, I just would never give up the freedom that it comes with.

Nathan Latka

01:53Guys, if you're sitting there watching this on YouTube going, amen, give Melissa some love here, hit that like button, comment below. Melissa, tell us about ewebinar. What's the product do?

What eWebinar Does and Who It Is For

Melissa Kwan

02:01>> So exactly as you say, it saves people from doing the exact same webinar over and over again. So you can imagine demos, onboarding trainings, especially for SaaS companies. You are probably constantly doing those things, maybe live on Zoom or something else, or putting it on YouTube, which isn't as interactive. So this product was actually designed for bootstrappers because this was a problem that I personally live with, with Spacio for five years and a product that I

02:30>> dreamt of having every single day. So you can imagine like how much more efficient you can be if someone else is running all of your demos, onboarding and trainings, and you never have to do them live.

Handling the Automated vs. Live Webinar Objection

Nathan Latka

02:41Yep. So I wanna talk about strategy and then get into your growth and how you've added customers. On the strategy side, I imagine there's people listening right now going, I've thought about automated webinars, but it feels weird inviting my list to an automated webinar. It feels like I'm tricking my users. I'm sure you hear this all the time. How do you get around that?

Melissa Kwan

02:59>> Well, I think it's only tricking your users when you start by telling them it's live when it's not. Because authenticity, especially when you are bootstrapping is your currency.

03:12>> You can spend years building your credibility and just seconds to destroy it. So we are advocates of please do not trick your customers. Do not tell them it's live when it's not. You should be open and honest to tell them, hey, this webinar is recorded, but I'm managing the chat, which is exactly what we allow you to do.

Nathan Latka

03:29Oh, what's going on there, YouTube? Good to see you guys. Now imagine this. You love watching these interviews with SaaS founders, but imagine if we took all of the valuation data out from over 2,807 interviews I've done manually. Saves you a lot of time. Well, we've done this. We've built it into the beautiful interface inside of Founderpath. Check this out. I'll show you how you can access this in a second. But you log in, you connect

03:53your Stripe account, you see your valuation real time, you can see what changed over the past eighty eight days and even set goals for valuation this year. Now the secret evaluation is there's many different ways to value a SaaS business. So the reason you're gonna see three or four different valuations inside of your Founderpath dashboard, this is all free by the way, is because depending on who's doing the buying of your SaaS company, you're gonna get

04:17a different valuation. A VC is gonna pay a different valuation, private equity firm is different. If you're gonna do a minority sale, that's different. And if you sell the whole business, that's a different valuation. You can see all those when I hover over here. Right? So the teal is what a VC would pay. Yellow is what private equity and red is if you sold the whole thing outright. Now what's cool about this is this is not

04:39built off random data. Again, you guys hear these interviews on YouTube. All these datas are built from real time valuation data points founder share with us on the show. So traction, 1,200,000 seed round, 3.7 raise. They sold 22% of their business. Go in here and filter by the event. Maybe you only wanna see companies that have sold the whole business. Well, here are a bunch that have been acquired the valuation and the multiple. Maybe you're going

05:05out right now and you're raising your seed round. Well, go in here and look at all this recent seed deals that went down, what they raised, what valuation they raised at, and what percent that they sold. There's never been a larger dataset of SaaS valuations than what you can get now inside of Founderpath. And we're thrilled to bring it to you. Alright. We're gonna go back to the YouTube video here in a second, but if you

05:27wanna check this tool out, if you wanna jump in and sign up, you can check it out for free to get your valuation at this link. This link, founderpath.com/products/valuations. Or if you go to founderpath.com and hover over products, click on get your valuation here, and go ahead and sign up to give it a whirl. Again, all that valuation data live right inside the platform. I hope to see you there. Alright. Let's jump back into the interview.

Melissa Kwan

05:54>> If anyone do the trick, right?

Nathan Latka

05:56Because that's my problem. If I say it's a recorded webinar, people are gonna go, well, then I'm not gonna click through the email and attend because it's just recorded. That's boring. But you say, and I'm live managing the chat. That's what you say. That's the trick.

Melissa Kwan

06:07>> Yeah. I mean, is a trick and it's not because the chat is asynchronous, right? It's like Intercom, it's like Zendesk. So we interact with asynchronous chat every single day on websites, on our support. Why can't we have that on an automated webinar? This is actually the feature that allows you to fully automate your webinars 24/7 and never miss an opportunity to communicate your customer or your prospect. That was actually the missing thing that I had

06:33>> in my previous company. And I think Nathan, anyone who even says like, Oh, I feel like tricking my customers. They've probably looked at other solutions before and thought, Oh, this is super scammy. And I was one of those people.

Nathan Latka

06:44Or they got suckered into someone else's marketing that was selling a live webinar. They spent time, they showed up and they realized it wasn't. And then they just hated those automated webinars for everyone.

Melissa Kwan

06:53>> Well, yeah, exactly. I think this is actually one of the biggest hurdles that we have to get through is how do we change that preconceived notion and build truly the Netflix of webinars, not the scammy automated webinars that people might know of previously.

Pricing Model and Biggest Customer

Nathan Latka

07:08So Melissa, what do you charge for this? What do customers pay per month on average?

Melissa Kwan

07:11>> So it starts at 49 a month. We charge by number of published webinars. So once you publish it, you can set a recurring schedule so you can run it a 100 times, 200 times per month, and then it kind of goes up from there. So we do not charge by number of users or number of attendees like most other people do.

Nathan Latka

07:29Interesting. And so obviously some people pay 50. What is the big Can you tell me what the Don't name the customer. What's the biggest customer pay you per month?

Melissa Kwan

07:35>> So we max out at $10 per webinar per month. And our biggest customers has about right now, two ten webinars and counting. Per month? So per month.

Nathan Latka

07:47So that's like $2 k a month then from your biggest customer.

Melissa Kwan

07:51>> Yeah. And you can imagine the manpower that actually substitutes to run 200 webinars concurrently every single month.

Nathan Latka

07:59Crazy. Huge. I totally get it.

Melissa Kwan

08:00>> That's it's amazing.

Nathan Latka

08:01I mean, I we do webinars and there are a lot of freaking work, so that makes sense to me. All right. So you started at $50 a month and then put all this on a timeline for me. When did you launch the business? What year?

Company Timeline and Launch in 2020

Melissa Kwan

08:13>> July 2020. So it's been two years since the product has seen the light of day. We built it for about a year and a half it So was actually like

08:24>> my co founder, we had a dev team. So one thing I learned coming into this business is I do not like managing people. So our entire team is outsourced.

Nathan Latka

08:34I love you, Melissa. I love you. You know how long it took me to admit that publicly? You know, people, I'm like, you know what? Everyone talks about a big team and 300 people and these team retreats and celebrating birthdays in the office. I'm going, I don't want to do any of this.

Melissa Kwan

08:48>> Don't want full time people. I don't. I don't like hiring. I don't like firing. Like I don't like those emotions. I love building businesses. I love sales. I love innovation, but I came into this business actually thinking I do not need any employees, including a co founder. So I actually hired a dev shop to start with, unfortunately.

Nathan Latka

09:07What did you use?

Melissa Kwan

09:09>> Well, because it didn't work out. I don't, yeah, I didn't actually wanna say, yeah, don't wanna share it.

Nathan Latka

09:15Tell me why, what was the lesson? Can you tell me the lesson there? Why didn't it work? Was it your fault or their fault?

Melissa Kwan

09:20>> I mean, I don't think it was anyone's fault, right? I think a lot of dev shops starts with, Hey, I can do this. I can take the contract because it's a big contract. And then you go into a product realizing if you don't have a person thinking about this product every single day, every living moment, that's as invested as you, it's like having a restaurant without a chef. So I came in thinking, hey, this dev shop can

09:44>> be my CTO and all my product things. And I can just go do what I do best, which is build the business, But it just doesn't work out like that. So I think they hugely underestimated what it took to build a product because they'd never built a product before. And it turns out like my life partner, David, I did not know that he could code as well. He actually

10:08>> fixing things for me because he was like criticizing this, criticizing that. And I'm like, why don't you go fix it? I can't fix it. And so he started coding for us and I was like, wait a second, you're actually like the 1% of the 1% coder. So I was like, why am I paying these people? Why don't I just end my relationship with them? And we work out an arrangement for you to be my co founder.

The $350K Dev Shop Mistake

Melissa Kwan

10:28>> So he actually came in about a year into the business and we worked in an arrangement that works based on that. And now he's my co founder. So we built that for a year and a half before we put ewebinar out on the market about two years ago.

Nathan Latka

10:41Let me break that down for a second. So tell me the painful number. How much money do you sink into this dev shop that didn't work before you cut it off?

Melissa Kwan

10:48>> 350,000.

Nathan Latka

10:50Oh, my God.

Melissa Kwan

10:53>> It would have been more if I kept going.

Nathan Latka

10:55Yeah. Okay. Fair.

10:56Wow. Okay. 350 ks.

10:57How could you not tell earlier? Why did it take you 350 ks? Why couldn't you cut off at 35 ks?

Melissa Kwan

11:04>> Well, okay. So here's the number, right? So we sunk a lot of money into like branding and design. Like, I am not a founder that's like, okay, let's do this not cheap. I'm all about ROI. So what is the maximum output that I can get for the minimum input? And that doesn't mean paying the least, right? That means finding the Pareto efficiency. So what we did was And

Nathan Latka

11:27you have a beautiful website, so it pays So

Melissa Kwan

11:30>> we hired the best person we thought we could get to do all the branding, the design, and that costs a lot of money. I mean, that in itself was probably 65,000, right? And I'm saying like every single page of the website, every single page of the first version of the app and the branding and all that back and forth, right? And then you've got like dev shops charge in phases. So it was broken down into four

11:56>> phases, right? We basically went through three phases before I was like, okay, I actually don't think continuing this makes sense because another mistake was my friend owned the dev shop.

Nathan Latka

12:09Ah, that's So tricky.

Melissa Kwan

12:10>> Was really difficult for me to say, Hey, you're not delivering, because there was no reason for me to doubt him because I am not technical. So it wasn't really until David was looking through the code because he was always going to be the bridge between this dev shop and us moving our quote unquote in house team to Vietnam. So we actually, all our developers are from Vietnam and David is our CTO who still codes, but actually

12:35>> manages the team over there. As he was looking at the code, he was like, wait a second, like this isn't the way it should be done. And that's when he stepped in and that's when I had to have that hard conversation with my friend and say, Hey, I actually don't think this is going to end well. And you are actually sinking too many resources to try to make this happen. So it was a no win situation

12:55>> for both of Yeah, smart move.

Bringing in David as Co-Founder and Equity Split

Nathan Latka

12:57Okay, so you bring in David. Now negotiating with a life partner for equity and business is not easy. So are we talking like 10%, 20% here? Was it like a fifty fifty split?

Melissa Kwan

13:05>> So another thing I learned in my previous business is while I have no doubt that there are some CTOs out there that can also build a business, but I am a firm believer that a CTO is a great product technology partner, but the business is built by the CEO. So in my previous business, it was a fifty fifty split. But coming to this one, and because they had been there for my previous life, I was like, hey,

13:38>> based on my previous experience, what do you think is a fair number for you to feel invested and for you to feel like a co founder, but also know that I'm going to be building the business around the product. So the split between us is 35, 65. It was something that

Nathan Latka

13:58Melissa, held to her guns.

13:59I love that story.

Melissa Kwan

14:00>> Yeah. Mean, he yeah, I mean, he put out that number. It was something that he felt was fair. Frankly, also think it's fair.

Nathan Latka

14:07I love that. Okay. Talk to me a little more. There's people watching this right now here on YouTube, on iTunes going, man, I want to use contractors too. I don't like full time employees. So you learned what not to do, but you still how many contractors did you pay at least a dollar last month?

Team Structure, Burn Rate, and Salaries

Melissa Kwan

14:19>> So our burn right now so I don't pay myself. David and I don't pay ourselves because I had previous exit. We were able to kind of ride off that. So we're lucky in that way.

Nathan Latka

14:30Melissa, was that like, like, you super rich or was that like a million dollar exit and you have, you know, a year Yeah.

Melissa Kwan

14:34>> Or was. Two So I'm not allowed to say the number based on our previous contract, but it was my personal exit was like in the low 7 figures.

Nathan Latka

14:44Okay. So plenty of flexibility. Yeah.

Melissa Kwan

14:46>> Some flexibility, but like for people hearing this, like, don't forget that I sunk a decade into that. So if you take that exit, like absolutely life changing. But if you divide it by 10, Yeah. Like, that's like having like an amazing sales job at SAP. Yeah. Right? Yeah. And having all the benefits and all that stuff. But, you know, it could have gone the other way as well.

Nathan Latka

15:08Yep. So what do you can I ask what are your total expenses now per month?

Melissa Kwan

15:11>> Yeah. So Sorry. I lost my train of thought. It's about 60,000 is our burn. So for where we are and if you've seen the product, like that is extremely efficient. We do not total hire

Nathan Latka

15:24expenses or your net burn?

Melissa Kwan

15:27>> My total expense.

Nathan Latka

15:29It. And so are you making you're making more than 60 ks in MRR yet or no?

Crossing $500K ARR and Path to Profitability

Melissa Kwan

15:34>> No. So my the only thing that matters to me right now is profitability. So we just crossed 500 ks ARR. Thank you. But I'm still not paying myself. For people out there, it really takes a lot. But yeah, so we're about 20 ks right now from that. I think we'll see it this year.

Nathan Latka

15:56Yeah. So just to be clear, you're doing about $40,000 a month in recurring revenue, 60 expenses, you're burning 20 ks a month, but growing. I mean, so if you're at 45 ks per 40 per month right now in revenue, where were you exactly a year ago?

Melissa Kwan

16:09>> So I have that number. I think it was like, I wanna say it's like 10 or something like

Nathan Latka

16:16Okay, you've grown. So where's the growth coming from? But tell us real quick last two minutes here. How are you signing up new customers?

Customer Acquisition: Word-of-Mouth, SEO, and Automated Demos

Melissa Kwan

16:22>> So truth be told, we have not fully figured that out yet. Marketing is not something that I know well, but our biggest user acquisition channel is word-of-mouth. For our price point of product, one on one sales does not work. Like outreach doesn't make sense. So we are investing heavily in SEO and content. So our website traffic is going up significantly every month, but our number of demos is kind of staying stagnant and our conversion rate, by

16:55>> the way, we only do demos through ewebinar. I do not do live demos, which is kind of amazing. Our conversion rate from demo to trial is 25% and all that converts on its own. And our trial to pay conversion rate is actually close to 70% every single month.

Nathan Latka

17:12Okay. Those numbers work. And how many customers paying today?

550 Customers and Bootstrapped Capital

Melissa Kwan

17:17>> I think we just crossed five fifty.

Nathan Latka

17:20Five fifty. You're getting some momentum here. This is great. Love this story. And just to be clear, just so everyone hears it again, bootstrapped, No capital raise except your own.

Melissa Kwan

17:28>> Yeah. No. Friends and family as well. Also our own. Of course, Yeah.

Nathan Latka

17:33Fair enough. And you really are two people on the team and then everyone else is contractors. Right? Two FTEs?

Contractor-Only Team and Development in Vietnam

Melissa Kwan

17:39>> Well, I mean, David's also a contractor. So Okay. Like, literally everybody is Our COO, our partnerships person, our dev team, we have multiple content writers. I mean, I think everybody should choose where they want to spend their time. That is like a core belief.

Nathan Latka

17:56What dev shop do you use now? Do you want to share them?

Melissa Kwan

17:59>> Yeah, it's HD Websoft from Vietnam in Ho Chi Minh. We chose it because number one, we love Vietnam and we love going there. Number two, I had a lot of friends that tried them and said they were the best. However, I do not recommend it if you do not have a senior dev, senior engineer or CTO that actually manages the team.

Nathan Latka

18:21Yep, yep. And real quick on the content, what dev shop or how did you, sorry, not dev shop, but where did you find your writers?

Melissa Kwan

18:28>> Man, that is so hard. Our COO actually turns out to be He's a great writer. He went to school as a playwright. So he actually heads most of our content. And then a lot of the writers that help us, I just find through referrals through LinkedIn. We've tried a lot of them. We probably have tried over 20 writers.

Nathan Latka

18:46Wow.

Melissa Kwan

18:47>> And we now have like three or four that we work with regularly.

Nathan Latka

18:50Yeah, very cool. Melissa, this is a great story. Let's wrap up here with the famous five. Number one, what's your last business book you read?

Famous Five Rapid Fire

Melissa Kwan

18:59>> Man, I would say The Presentation Secrets of Steve Jobs. Highly recommend it.

Nathan Latka

19:03Yeah, that's a good one.

19:04Number two, is there a CEO you're following or studying?

Melissa Kwan

19:08>> Wow, it doesn't come off from the top of my head. That's okay. Justin, no, you know what? Justin Welsh, I am following him religiously.

Nathan Latka

19:15Number three, what's your favorite online tool for building your own business besides ewebinar?

Melissa Kwan

19:21>> Definitely Slack.

Nathan Latka

19:23Number four, how many hours of sleep do you get every night?

Melissa Kwan

19:28>> Nine or ten, like a baby. Awesome. I love that. And what's your situation?

Nathan Latka

19:32Well, it seems like you have a life partner, David, right? Any kids?

Melissa Kwan

19:35>> No. Ewebinar is my kid. Yeah. And I think that's enough.

Nathan Latka

19:40Okay. And do you mind me asking, Melissa, how old how old are you?

Melissa Kwan

19:43>> I am turning 39.

Nathan Latka

19:4639. Happy early birthday.

19:48Last question. Something you wish you knew when you were 20.

Wrap-Up and Key Takeaways

Melissa Kwan

19:54>> Start your own business early.

Nathan Latka

19:57Guys, there you have a really great story here. Ewebinar launched back in 2020. She burned three fifty k on an MVP before she learned that Dev Shop just wasn't going to work. She ended up bringing in her life partner, giving him 20, 35, I think the 35% is what she said. But guess what? She's really the only full time employee here. And they're now doing $42, $43,000 a month in revenue, five fifty customers to help you run automated

20:16webinars with asynchronous live chat or asynchronous chat next to the webinar. That's the secret sauce. They're up again from $10,000 a month just a year ago. So healthy growth, all bootstrapped. She's a one woman wrecking machine. Melissa, thanks for taking us to the top.

Melissa Kwan

20:30>> Thanks so much, Nathan.

Nathan Latka

20:33One more thing before you go. We have a brand new show every Thursday at 1PM central. It's called Shark Tank for SaaS. We call it deal or bust. One founder comes on, three hungry buyers, they try and do a deal live and the founder shares back end 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 1PM

20:58Central. Additionally, remember these recorded Founder interviews go live. We release them here on YouTube every day at 2PM 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 SaaS world, whether it's an acquisition, a big

21:20fundraise, a big sale, a big profitability statement or something else. I don't want you to miss it. Additionally, if you wanna take this conversation deeper and further, we have by far the largest private Slack community for B2B SaaS 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 go in there and quickly search and see what people are saying. Sign up

21:42for that at nathanlatka.com/slack. In the meantime, I'm hanging out with you here on YouTube. I'll be in the comments for the next thirty minutes. Feel free to let me know what you thought about this episode and if you enjoyed it, click the thumbs up. We get a lot of haters that are mad at how aggressive I am on these shows, but I do it so that we can all learn. We have to counter those people. We

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