How FusionAuth CEO Brian Pontarelli grew FusionAuth to $10.1M revenue and 50 customers in 2024.

just got done editing this interview you guys are gonna love it before i do that though i want you to know that i'm going to be in the comments for the next 30 minutes or so answering your questions if there's additional questions you want me to ask the ceo next time i interview them leave them below or if you're just loving the data points i get ceos to share click the thumbs up button below that's your way of telling me you're loving this stuff and i'll get you more of it additionally again i'll be in the comments answering any questions you have all right for 30 minutes enjoy the interview hello everyone my guest today is brian pontorelli he's a successful technology entrepreneur currently focused on solving login registration and user management challenges at his company fusionoff.io brian you ready to take us to the top yeah absolutely all right so what is the business model on the company is it a pure kind of sas model it's different so we are calling it uh like a hybrid sas or a downloadable sas there's a lot of different terms we're kind of uh playing around with but basically it's a sas but you can run it anywhere on any server in the world okay uh actually on the server or you spin up a private cloud either because it's gonna private cloud we can run in our cloud we can run in your cloud so it's that sort of like hybrid approach but uh it adds a lot of flexibility one of the main differences between like a normal downloadable product and what fusionot does is a lot of the downloadable products like require a ton of configuration they're like a lot of development a lot of code to just even get working we feel more like a sas where you log into a web interface and you do everything you know there yeah okay so let me ask you a question if i pay you and i and i take the software and i install on my own servers um and then you know a year you know comes up do i have to pay you again an sla a service license or something or do i have it you know for life for that one payment up front you can not pay us ever okay so it's similar to like uh my sequel model or any of those it's not open source but it is just free for developers to use the only thing you pay for is if you want us to do hosting or do any professional services or you need any type of support okay so you pay for hosting and support so i guess let me ask you a question over the past 12 months when you look at your total revenue which of those three things you just mentioned makes up the majority of your revenue hosting support or professional services hmm they're about equal right now oh okay yeah they're like you know it's a pretty good blend we have a lot of people paying for proserv helping get features out got a bunch of hosting contracts and then we're starting to you know get some pretty good sized uh support okay well i guess then let me ask you a question if i forced you into giving me an average like a sweet spot what would you say the average customer pays you per year to use the technology or the professional services or the hosting hmm on average that's a good question i would say somewhere between six and ten thousand dollars for a year okay maybe some kind of 500 to a thousand dollars a month something like that yep okay now what year did you found the company so the company's actually been around for 13 years uh we we have another product it's been paying the bills it's called clean speak it does profanity filtering in moderation um and so we work with a lot of game companies a lot of really big brands you know that's it's a pretty turn-key solution and is that a sas model it's the exact same okay sort that hybrid and so one of the reasons that we sort of approach the entire industry this way if you think about data like users user chat user information like anything that's around users anytime you're dealing with that you you have to be able to deploy on premises right because you might be in germany and german finance laws require that customer data is housed in germany so a pure sas play just it won't it won't work so that's why we go with this hybrid approach and it works on every industry finance you know construction retail e-commerce gaming everybody has different requirements so we figured why why limit ourselves so what year did you officially launch fusion off so we officially launched fusion off september of last year so we've been going for just about 12 months okay and how'd you get your first customer do you remember so the first customer we uh they found us so they were digging and digging they didn't want to use octa they didn't want to use ping they didn't want to use aut00 and they just kept digging and then finally they found us you know we hadn't didn't have a name back then uh contacted us and said hey we really want to support you guys we love what you're doing um let us pay you okay and i mean how did they find you did you have like an seo page set up was it a search keyword they knew you personally what was it i think what ended up happening is we had one article that was basically like hey there's a new player out there that's trying to you know take on the the big guys uh and and because they were looking for you know one of those names they found the article and they're like hey i've never heard of this clicked on it found us where was the article published um it was on i think it was one of one of those like comparison sites like alternative to or like uh you know programmable web i can't remember exactly which one but it was they had done a write-up of us alternative too interesting okay very cool and why didn't they like ping so you know interestingly a lot of the other solutions um just have problems when it comes to some of the features right so it's either you can't run it on premises right so that's a big big one with like you know octa and some of the others ping you can run on premises but it's also pretty heavy it's it's in order to get like all the components that they needed they were gonna have to buy like four or five different individual products stitch them together and that's a huge endeavor with fusion auth again we try to make it look like a sass right it's like it's one simple product you fire it up you click click click and you have everything from single sign-on into like you know two-factor you have it all there's no bolt-on packages you're not getting in the guts and like trying to figure out how to configure plug-ins so it doesn't work that's the first customer that article now how many customers have you scaled to today just on this product you know that's a good question i think we have about 1500 total customers okay not including cleans just on fusion off just on fusion off we we're at i think we're at about 200 000 total downloads 200 000 total dollar okay wow impressive now i mean can i take 1500 times that sweet spot of 500 a month i mean that puts you at 750 000 a month in revenue just on this product is that accurate or overstated so we're actually not ready to share revenue yet we're uh we're getting ready to ramp up and and uh let's check back in six months and see where things are at but the 1200 number or 1500 is total active running instances in a production environment it's sort of what our metric is right because what we're doing sorry i don't mean i don't mean jump in like this this all the time i get people come on that and i don't think you're this kind of entrepreneur because you're not in san francisco and you haven't raised a hundred million dollars and with some crazy evaluation but so many ceos come on all the time and brag about customer numbers which are not customer numbers they're installs or like users so i guess my question is it's amazing on 12 months that you've got 1500 of these people you know installed actively using it but like that first customer how many have you actually converted to paid oh how many paying customers gotcha um i think we probably have about 50. okay and what makes people convert why not why don't they just stay on the free plan um i think it's really when you trust an external system to do your login if that goes down nobody can use your app so while yes they could you know manage it and do everything themselves provide their own sla and you know if something comes up trying to debug it themselves i don't think a lot of companies are like you know like to play around like that right like the gamble yep okay and then in terms of growth i mean were you at basically zero revenue exactly a year ago or a thousand two thousand a month something like that we were we were essentially at zero revenue on fusion auth a year ago okay and then now 50 customers at 500 bucks a month you're somewhere around 20 25 000 bucks a month in revenue that's a you know pretty pretty close yeah okay what about churn has anyone started paying and cancelled um we have i mean that's kind of the nature of professional services that's kind of how it goes just look at the last part though so like the stuff that should be sticky like hosting yep uh no all of our hosting customers are still here we've had uh two customers go out of business okay so they just shut down the whole system and didn't need login anymore so even though it's not your fault if you look at churn over the past 12...