How G2Xchange CEO Ron Jones grew to $1.8M revenue and 7K customers in 2022.

hey guys recording this here on what is it friday the 19th maybe you're seeing this on monday at the latest but want to let you know we are almost sold out for founder comp sorry founder 500 in austin texas here in about a week uh it's gonna be an amazing event 500 b2b sas founders i'm looking at the attendee list there's almost um there's almost 60 founders with more than six seven million bucks in arr it's an incredible group of group there's over uh there's over a hundred over 150 with more than a million uh more than a million revenue it's an incredible group you don't want to miss it uh grab your hotel grab your flight grab a ticket right now i'll put the link in the bio um in the description here on youtube and i think there's only about three tickets left okay about three tickets left i'd love to see you guys there don't be bashful grab your ticket now hey folks my guest today is ron jones he's building g2 exchange which is actual insights for government contractors ron you're ready to take us to the top yes thanks for having me nathan all right do you come from the government sector yeah man so my entire career has been in government contracting uh funny enough started my career as a software engineer moved into solution architecture technical sales and then finally went over into software and services sales and um it's been federal contracting with a mix of global public sector um but the vast majority has been north american public sector which you have your federal contracting you have defense contracting but you also have um state and local law enforcement public safety um even some work for the canadian government too very cool okay so give me an example what is what are one of these governments paying g2 exchange for what's the product yeah so it's actually we actually don't serve well we do serve government right we do have lots of government users but this is a product for sales business development and capture professionals that serve the government so whether you're a software company that sells products or sells services right um that's what we do we have actual insights which is basically just bits of relevant data from multiple disparate public data sources right to help speed up your business development efforts okay what might be something i'm selling to the government that i'd use g2 exchange to get data on yeah so anything like for example like aws is one of our customers they sell you know lots of cloud services as you know to the government deloitte another customer of ours um management consulting technology implementation like a lot of folks may not know this but the government is the largest buyer of goods and services in the world so everything from down to like plastic forks and knives in a cafeteria on a military base to rockets right all right so what what are you selling the person that makes plastic forks for military bases what are you showing them on g2 exchange yeah so we focus on a couple of major categories around things that will help you have an impact on your business development efforts so for example when contract awards are released right uh we write tidbits about that so we have articles that basically focus on the award itself give some supporting data but also the crux of it really is the additional data which is like you know the the uh information about for example their senior leadership team where else they've worked in the government so what other contracts they performed on what their capabilities are right and also you know some of their recent wins if applicable and the way that this is actionable right for a bd sales or capture person i'll explain capture in a second uh for those that are unfamiliar but the way this is actionable is that hey if you're looking for partners right to get your technology into a specific government agency and you see that they're delivering or they want an award that is a response that that you know includes implementation of that technology in the scope right that's something that uh got it you might might be able to reach out to them and say hey you know he's got it what would the fork manufacturer or aws on average what do customers pay you to use the technology yeah so we have a couple of tiers of membership but um it's we have an individual membership that's 500 dollars a year we don't do monthly subscriptions it's all annual so 500 bucks a year and we also have um business uh memberships you know corporate memberships which you know it's it's a per seat discount right so our poo is kind of sitting in like the 250 dollar range across 7000 uh users or so and you know that's you know so we got a good mix of monthly rp or annual daniel got it got it so can i take seven thousand times 250 you're doing about 2 million revenue today yeah we'll cross the 2 million mark in november that's the projection 2 million mark in november um you know and and you know we're launching a new product line new business line to focus on defense specifically so right now we've just got health uh federal health which is the big health care agencies and federal government we've got federal civilian which is just about everything else that's not defense related and then next month i'm sorry month after next we're scheduled to launch g2x defense which will focus on everything defense contracting oh what's going on there youtube good to see you guys now imagine this you love watching these interviews with sas founders but imagine if we took all of the valuation data out from over 2807 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 founder path check this out i'll show you how you can access this in a second but you log in you connect your stripe account you see your valuation real time you can see what it changed over the past 88 days and even set goals for valuation this year now the secret evaluation is there's many different ways 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interview ron help us understand growth right so if you're doing a one point you know eight million-ish run rate right now which is about 150 000 per month what were you doing exactly one year ago do you remember yeah so um a little bit of backstory i was brought on as an operator right i did not found the company however uh about a year ago uh well let's just tell let's talk exit you know 2020. exit 2020 was about 800 k so coming in exit 20 you finished 2020 with that yeah yeah uh recurring revenue from subscriptions um and in that year you know we had launched festive that vertical so that kind of helped accelerate it accelerated through 2021 um i was brought in as a matter of fact as an executive as part of the former parent company in june 2021 right and so through some you know it was it was an exact acquisition two brands right uh one focused on events one focused on providing this intel uh working with the ownership team and leadership team that was there kind of advice hey we could transform this product this service into a sas business right it's techno it's a tech enabled market intelligence service today but in our roadmap we're building a sas product to introduce the market probably q2 of next year okay interesting and so 800 000 in 2020 did you like double do like a million a million six in 2021 something like that yeah uh yep as close to it's close to a million seven okay very cool yeah yeah well so why why have you been flat then right so you're at like one seven right now in terms of run rate so you haven't grown over the past 12 months yeah so we've grown a little bit um one of the so a few of the things that we've realized and you know we're starting to we're kind of growing really slowly but some of the things that we've realized is that you know we needed to broaden the categories of content that we that we produce uh insights on so if you're familiar with the north american industry classification system it's uh makes code referred to we've only reported on you know maybe you know 15 of those right now right there's tons of them right and there's all types of government contractors and historically we've been focused on just t uh and and general management consulting we're trying to broaden that to construction facilities management r d right so on and so forth so that's one thing uh that we've we've uh started to put into play um the other thing is that um you know again the the vertical all of our customers have been asking for hey when are you going to get into defense which is by far and why the largest market you know in government contracting all customers all customers are always going to ask you for new products right but there are still companies that do that and they still grow 200 percent every year now look you don't have to grow really fast if you haven't raised a bunch of money so are you guys are you have you guys have they raised a bunch of capital vc capital are you bootstrapped no no bootstrap we have no okay so so you joined in 2020 then 2021 and and you're you didn't buy 100 right you're effectively working for a private equity from running the business yeah private investor yes yeah okay okay okay got it so it's a private wealthy individual who bought the company not like a traditional big pe shop that's right that's right and why do that as a young guy you can do whatever you want why not start your own thing and own 100 why work for some other guy and get not as much upside that's a great question as a matter of fact when i was at ibm you know i was in the process of trying to start my own uh consulting firm right to sell products so it's not products but sell services to the government just the same thing i was doing before uh but this is you know a long-term mentor um and friend that you know um said hey you know i need someone to come in and help with this and i thought you know it's it it was a good idea for me and he bought it in 2020 yeah yeah was it is there a press release did how much did he pay for it um i i don't know exactly how much he paid for it um i know it's some multiple of of earnings right uh but yeah that but that that close about q4 2020 before you joined okay and then i mean how much are we talking like you own like five percent equity today or ten percent you have any equity so it's shadow equity yeah you have someone on recently that have the same setup it seems to be you know pretty common in like a private investor private equity kind of situation but it's shadow equity 20 20 okay what that means if you sell the business a year from now for 10 million dollars you you don't own equity in the cap table but you'll get effectively equity at the exit which is you know 2 million bucks on the 10 million sale right liquidity event triggers it and and that's how you know the shadow actually over right yeah yeah um cool uh very cool um let's uh i guess last thing here before we wrap up how many folks are full-time on the team today 19 full-time about six product engineering um and those are all brought on in 2021 to help build everything that we're about to release right um and then the rest of the seven content so there's also researchers analysts writers right so they focus on building the actual insights you know producing that the rest of us uh wear multiple hats across different growth functions so customer success um marketing right support and another important distinction is that there's no sales people right i mean i would hate to venture into like the hey we were product led before it was cool kind of thing but it's grown organically um uh from the start right so we've just now started experimenting with paid advertising jury's still out um how much did you spend last month on paid just about fifteen hundred dollars just to try you know just to see what kind of things happen but you know interestingly enough though uh for the very first time our primary acquisition channel flipped to google search or just organic search you know broadly primarily it has been direct um how many clicks did you get last month from google search i don't know how many clicks but i think last month we had about i think like three or so three or four hundred uh sessions or something like that if i'm not well not sessions not impressions yeah impressions yeah yeah so when people so when people searched on google your results for your content were showed in google results 400 000 times but like that's a vanity metric like the trick is how many of them actually click your website exactly what matters most to us right now is like conversions right and so that's why here's another interesting fact when i came on board there were no landing pages yeah right and so one of the first things we did when i joined is well i took over a ceo in may um we launched loon landing pages right we have pricing pages everything out there in the open introduced the 14 day free trial you know which we have uh since you know it kicked off towards the end of may we've done about 30 percent trial conversion rate which is pretty good wait ron let me break this down okay so last month last full month which was july right how many new signups did just email sign ups did you have um i think as far as trials or as far as you know however you define it what's your type of funnel man yeah so we had about 300 different sign-ups and the other thing too to note is that how many of the three people yeah yeah let me just stay focused here for a second how many of the 300 are actually do you require a credit card for the free trial no no it's it's no credit no obligation free trial okay so of the 300 that sign up for the 14 day free trial how many converted to pay they're paying customers today it's between 70 and 80. okay so that's where the 30 conversion comes from yeah okay and the other thing too is we have um a free account so any government employee gets a free account right because the government also uses this as market research in a way yeah makes sense very cool we love the funnel we hope you double it over the next 12 months we'll see what happens in the meantime though ron let's wrap up with the famous five number one favorite book yeah it's gotta be a tie hard thing about hard things ben horowitz and um working backwards it's an amazon story by um colin breyer and bill carr um yeah not much else to say about that number two is there a ceo you're following or studying uh i'd have to say satya nadella he's a really humble guy and and i like the kind of story around him kind of more more or less refounding microsoft right in a way number three what's your favorite online tool for building the business slack about it number four how many hours i sleep to get every night about six okay and what's your situation married single kids married kids how many kids two two and how old are you 34. last question something you wish you knew when you were 20. oh man uh fortune favors the bold right taking more risk earlier on right more risk guys g2change.com did about 800 000 bucks in revenue in 2020 now up to about you know the 2 million run rate in november what they do is they help people that make like forks for military bases basically source new contracts or aws who source hosting contracts with the government that's how they make money 7 000 folks paying 250 bucks per year that's what the platform looks like today flat growth last 12 months but ron is coming he's trying to change that with landing pages new funnels and new products with six new engineering hires we'll see what happens again team today of 19 full time ron thanks for taking us to the top thanks nathan one more thing before you go we have a brand new show every thursday at 1 pm central it's called shark tank for sass 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 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