How Gatherup CEO Aaron Weiche grew to $2.7M revenue and 1.3K customers in 2019.

hello everyone my guest today is aaron wykie he has over 20 years experience and founder partner on executive roles building digital agencies and sas companies he joined gather up in 2015 as a partner overseeing sales and marketing and took over the ceo role in february 2018. aaron speaks internationally on customer experience online reviews mobile and seo aaron you ready to take us to the top long time listener first time caller let's do it oh no by the way people always ask they go nathan we can't figure out why ceos agreed to come on your show you just beat the hell out of them like what is fun for them and why the hell do they do it so you answer why do you do it uh why why not you're doing it on a daily basis why keep it a secret right why not put it out there and why not have a good conversation well i'm glad you're i'm glad you came on i'm looking forward to this so usually when there's a ceo changing a company right there's a catalyst for it what happened in february 2018 where you move from sales and marketing to taking over the ceo role yeah i think it was just a maturation of our company our uh initial founders uh we're great at you know we're bootstrapped getting the company off the ground but i'd had a lot of experience scaling companies from kind of where we're at to those next two or three levels and i think it just became apparent to us as partners when we talked about it that i had the best experience and was the most suited to take us to those next steps so so your involvement prior to that were you an employee with an equity grant leading sales and marketing or were you an investor in the company what was your role before that uh i got brought on right as we were kind of uh forming the corporation once things kind of got moving so came on with an equity stake okay and basically you know vp of sales and marketing role so helping land land new business and get us out there and give me a general sense here we're talking about like a 10-person team or what's the team size yeah team size uh our 19th person starts on monday okay 19 people okay healthy good all right and then um we jumped into that fairly quickly tell us what the company does absolutely so the easiest way when i have a conversation with people is when you think about today as the amazon economy where pricing deliverability availability all of those have been commoditized what gatherup aims to do is help you defend the last two big things any company has and that's brand and reputation so in a simple way what we help you do is gather manage and then market those customer experiences and online review data to a business's advantage so easy examples would be like a 200 location storage unit or a 20 location fast casual restaurant our most commonly used feature is proactively reaching out to customers after that experience using email or sms and asking them how was the experience capturing net promoter score a few survey questions and trying to put them on the front door of writing an online review at google trip advisor facebook and older in order to bolster their reputation and can you so like name a customer you're talking like h m or like joe's crab shack or what yeah so uh customer be like uh pods right the storage units that get uh dropped off right in front of your house or uh allstate um and and their insurance agent so after you go in to uh renew your policy or have an interaction with them we follow up with a you know but we look at what we want to be as the best two-minute conversation after an experience we're not looking to be a medallion where you have 30 40 questions super taxing on the user we want it to be a positive brand experience and a win-win for the customer to be able to talk and a win for the business to understand far more from far more customers how they feel about that business okay good and then um give me a give me a sense here sideways so what are customers paying per month on average for this thing yeah so our pricing model is per location uh and that obviously can really range because we have um you know one location customers and then we have those that are in in the tens of thousands so probably the easiest way to quantify is you know one brand is an account um and and an account on average to us is probably worth around a 170 mark okay 170 bucks a month and that's usually spanning how many locations um well that can really range right so i can tell you we have 1300 active accounts um and inside of that like i said it can be at one location it can be a 12 000 location so there's really a lot of variety in there but we really have three main areas we're going after the single location is a complete self-serve then we have a you know multi-location so this could be 510 locations on up into the thousands and then we have a white label version of our product as you mentioned in the intro um my background as well as all of our co-founders all in digital marketing so we have a white label version and so we have hundreds of agencies that white label our software and then resell it to their customers yeah it gets harder and harder than track that like an average price point because of the markup the markdown blah blah blah okay okay can i generally take 1300 customers times that 170 a month you guys are what doing north of 200 a month now yes yep okay fair enough that's great and where were you you know call it when you were closing out december 2018. uh yeah at the end of december probably sub uh 190 ish okay 190ish and where is most of the growth coming from is it expanding those accounts to more locations or is it uh is it adding new logos all together yeah so it's it's a pretty even split right now with uh that reseller channel um you know great growth there while they're selling new clients in and adding new locations and brands to their accounts um but then the the biggest market we're most actively in is that multi-location right now especially in like a 50 to 500 location set is where we're seeing a lot of new customers and new logos coming on interesting okay and then talk to me about the growth i mean obviously getting these this amount of customers sign up is no easy task what channel is especially because you were sales and marketing right so what channel is working most effectively yeah so we are inbound like nobody's business um we're leveraging all of our experience there we post and share a ton of content so we do a lot of research in the area of online reviews we do a lot of you know thought leadership right we recently wrote an article about how google uh uses reviews and views reviews in junction with you know some of the the patents they've filed it and things like that okay hold on let's go deep on that one so when someone searches how google uses reviews first off before you even make the time to write the article i assume you have some sense of what the prize is if you rank number one for that term so what's total traffic on a term like that yeah so and it's not even as much we don't look as the traffic as much as the outcome we look at when we know these right when we write these things based on our background and things like that um one of our partners too uh mike blumenthal is a long time very deep uh expert in the in the local search and google maps industry so a lot of times when we create this content it gets amplified by those that are connected to it so like search engine land or moz things like that are going to link back to our articles as well as others writing articles about it so you know a lot of it isn't always as much we definitely have some things where we get good traffic straight from google but a lot of it is just being cited as as the resource and as an expert in that area by you know all kinds of different people that are got it so like this article will get backlinks from other people that want to reference you and that's a good way you get on the in leads yeah yeah so how many how many leads coming in per would you say per month yeah um it really depends by segment you know on the agency side well over uh a hundred agencies are looking into our pricing um looking to get demos and and add us to their pro pro product marketing mix um in multi locations we're we're there at about dozens okay um and enforce right now out of our 19 i mean we have one inside sales person on the agency side for the last year just because of what we hit and how much we needed there i'm still doing all of our sales in in the multi location world uh hopefully that's going to be changing it in the next six months um but yeah we put all of our focus into inbound haven't done a dollar of paid those 100 plus inbound agencies per month that come in i mean how many of them will you close that month or in the subsequent months yeah uh we're usually somewhere between 25 and 30 each month of what we're onboarding in that channel okay i mean that's all i i'll let you know 100 ish 170 ish per month starting yup yeah that's good that's nice growth all right good so you just said zero in terms of in terms of marketing spend i mean when you what about like a fully weighted cac so include salaries of people that are mainly doing things related to new customers yeah and because we're so inbound that's that's definitely one number i don't have for you we never really have buckled down on cost of acquisition since we're so focused on inbound well are you profitable yes absolutely we've been profitable for over three and a half almost four years okay i mean like can i push you a little harder are you turning like 10 to the bottom line 50 five probably about fifteen percent of the bottom line okay got it i mean look on 200 and north of 200 a month you're taking 30 grand to the bottom line you don't have to worry about cac you know it's working because you're profitable yep yeah yep that's that's obviously why i ask there so that's good nice congrats there um have you raised capital are you bootstrapped nope we haven't we are bootstrapped that's good any plans to raise uh no we sure get hit up for a lot of calls but uh we're pretty happy with being in control and running the way things are and you know we kind of have our our heads down on the work we love what we're doing we love the product love the customers and you know we kind of have some lines set that you know once we get to that then maybe we'll poke our head up and and start to look at what options be more specific there so tell me what you're getting hit with right now investors just reaching out saying hey we'd love i mean do they actually have you gotten anyone actually make you an offer uh yes we've turned turned away a couple offers what don't name the person because i want to go deep on like what the offers might actually sound like are they typically equity deals or convertible notes or venture debt or what uh yeah kind of uh like a third a third a third okay a third cash uh third convertible third third stock was probably the the best one that we turned out okay and so when you when you're taking these inbound and you're just analyzing them i mean tell me let's just focus on venture debt for a second the venture debt deal might sound something like we'll give you i'm making this up 4x of your 200 grand you're doing today per month you pay me back a 1.3 to 1.5 x repayment cap as in you know five to nine percent of your gross receipts collected per month what do you like or dislike about that model yeah i'm i mean mostly it just comes down to the control um and being able to kind of right the road the way we see it we're we we feel very good about where our vision is and and where we're at we don't we don't feel a lot of panic on not growing fast enough or what else is going on in the market and those things we obviously pay attention to the competitors and most of our uh direct competitors are very very well uh funded and vc backed name a few uh podium bird eye uh so you know we're talking about people that you know 20 to 30 million in in venture raised and very large teams but yet you know we we still uh we still going to had some head-to-head competitions and and are winning deals yeah podium eric's come on a couple times well north of 12 million bucks in ar i mean they are one of the fastest growing sas companies in salt lake right now bird eye north of 21 million bucks in ar when they came on the show so yeah but again they've raised 33 million bucks so um you know it's nice that you've been able to do this in a bootstrap fashion now you said that the reason you turn these down is because of control but venture debt typically there's no covenants no warrants there's nothing related to control in those so why don't you like that kind of model yeah again instead of it being absolutely 100 percent what what we're looking at and having control some of it too our company really has a lot of midwest values right i'm i'm based out of uh minneapolis and things like that and the whole of you know yeah using or answering to other resources instead of the ones you've created is just you know a little different than how how we view things yeah yeah that's that's fair that's fair um okay good let's keep um let's keep moving forward here so it turns critical in a sas company what's your turn yeah so our churn overall is about four and a half percent um and again we measure it by each of those buckets right so those single location smbs they're closer to like a five and a half percent they're no touch okay come on monthly gross logo churn yes okay um but then when we get into both the multi-location and the agency now we're at like a three to a little bit sub three and those are really our areas of growth and where we put our most focus and resources so so gross revenue churn annually is what fifty percent oh boy that one i don't know if i have you know our our net um with expansion you know we're close to 100 percent we're right around like 98 right do you know what expansion revenue is typically annually um not annually but you know we'll pick up somewhere around you know in the five to 10k a month from those agencies and then multi locations that ratchet up into you know one of our plans or higher usage well if you have churn monthly churn between three and five percent depending on who it is so three percent annually be 36 right that means let's just say best case scenario you've got 36 percent revenue turn annually but you're saying you're expanding by 36 percent as well so net you're at about 100. yeah yep yeah is that does that sound right when you hear it yeah yeah pretty close um you know and a lot of that churn again is those single location businesses that those are closer to like a 40 per month average to us so far below what many of these others are yeah that's why i like to look at revenue churn right and it it normalizes for our poo differences yep yeah and we we we're we're somewhat new to that but uh getting there just because we realized how big of a difference there is between our types of customers oh totally it's huge it's huge um so just be clear no paid the last 12 months no paid spend conferences google ads nothing like that okay so we just started we're just doing uh our first con conference sponsorship this summer mozcon which is a really big search conference in seattle so that'll be our first really big foray into doing something like that we just announced today that we're we're sponsoring that and those what these kinds of desserts would be like 10 20 30 grand yeah probably you know all in a 15 to 20 by the time you know employees sponsorship all all of those things they're all very good aaron let's uh let's wrap up here with the famous five number one what's your favorite book uh man uh so it's a really quick easy read it's called be like amazon even a lemonade stand can do it by jeffrey and brian eisenberg just focus on like customer centricity both amazon and other brands and how to make it really relatable and and grow it and just principles at any business because it's one of those things when i hire somebody i usually want to put that book in front of them to get up get them to understand how we think give me a ceo you're following or studying oh boy i mean not anyone in specific but just about any seo i come across i'm willing to soak up information follow them on twitter see what they're writing see what they're saying name one um uh uh help scout ceo i can't remember his name but i know you recently on on with you we use help scout as well so that's definitely one yeah good help scout a good one there um number uh and by the way ceo uh i'm trying to remember his name oh nick francis there you go nick nick francis help scott that's good all right number four what's your favorite online tool for building the company uh yeah so i'll go with the oldie book goodie campaign monitor uh i have probably used them for a decade now they were one of my first uh sas loves where i felt like they built features before i needed them a very long time ago in digital agencies so i'll give them some love for being we i still we still use them at gather up so good how many hours of sleep you get in per night oh i'm in a good seven to eight zone at this point okay and what's your situation married single kids i am uh i have a lovely wife for ho boy 17 years now and i have four kids jeez okay uh four kiddos and how old are you uh i am 44. last question what do you wish your 20 year old self knew and uh think bigger and then go after it once once you're thinking that big egg i definitely spend a lot of time being a little too real about certain ideas or only thinking very localized with them and when i look back i'm like all right the the core of it was a really good idea and i really should have pushed harder to step outside my comfortability and boundaries and and get after it guys gatherup.com helping you get better customer reviews just past 2.6 million dollars in a r r that's up from called 190 000 a month just about uh six seven months ago nice growth team of 19 people bootstrapped profitable taking about caught 15 to the bottom line every uh month 36 percent revenue churn gross annually but the expansion makes up for it so 100 net revenue retention uh no cat yet not spending money really on paid acquisition except the upcoming conference mozcon which they're gonna test out all right aaron thank you for taking us to the top thanks nathan enjoyed it