How Geeklab Reached $720K ARR and 60 Customers in 2023 (Interview with CEO Jesse Lempiäinen)

Host Intro and Company Overview

Jesse Lempiäinen

00:00He was in charge of getting installs done at his last mobile gaming company mobile app gaming company and said, you know what? There's no good tool for this. Let me build it. He launched geeklab.app in 2019. They're doing $60,000 a month today in revenue across 60 paid accounts, up from 27,000 a month just a year ago. They're looking right now at getting a round out round done targeting a 1,500,000 raise at somewhere near 12,000,000 post money

Nathan Latka

00:21valuation. Hey, folks. My guest today is Jesse Lempiäinen. He's an experienced product manager, marketer previously at Rovio leading the launch for Angry Birds Dream Blast and successful collaborations with legends such as Iron Maiden and the Super Bowl. He founded geeklab to solve app marketing challenges, serving top mobile gaming studios and recipient of the best app marketing agency award. It's called geeklab.app. Jesse, you ready to take us to the top?

What Geeklab Does: App Store Optimization Software

Jesse Lempiäinen

00:45>> Hey, Nathan. Thanks for thanks for having me.

Nathan Latka

00:48Yeah. So just to be clear, you're helping these mobile app developers get more installs. Are you doing this via software or consulting?

Jesse Lempiäinen

00:55>> Yeah. Exactly. So so through software. So in other words, like, when you're scrolling on TikTok or Instagram or whatnot and you click an ad, so on average around like 20 to 30% of those people actually only end up installing the app. So we have a software that allows you to optimize that flow and actually make it all the way as high up to 80%. So truly multiply the amount of installs that you'll get. Interesting.

Nathan Latka

01:18And so a lot of people use like a tool like Pendo for this on their website applications. You sort of help them do this, but inside a mobile app activation process?

Jesse Lempiäinen

01:26>> Right. And we're actually one step step above even. So so we're actually at that exact moment when the users decide whether or not they hit the install button. So on the App Stores and Google Play Store. So that's kinda our sweet spot where we we tackle the the marketability issues.

Nathan Latka

01:42Understood. And give me a general sense of economics here. How much do customers pay on average per month to use the technology?

Pricing and Customer Economics

Jesse Lempiäinen

01:49>> Yeah. So on average, we're a bit over $1,000 a month, 1,200 ish. And it ranges from all the way up from like $300 a month to like 5,000 plus. So we asked earlier whether we're strictly software or also on the agency side of things. So we don't have an agency, but as you mentioned, we actually won the App Marketing Agency award this year. So how it goes is that with the very high end tiers that pay

02:21>> us $5,000 a month ish. So we actually are very hands on in helping them not only use our tool, but also building the strategies around like how they can get the most out of our tool and and make successful campaigns.

Nathan Latka

02:33Do you upsell the strategy, you know, a one time consulting fee of $50,000 or is that just included in their monthly plan?

Jesse Lempiäinen

02:39>> We've actually, we've we've quite a lot like play around with this this strategy and so far we've found that in some use cases it's still like a good hook to to sell like a once off consultancy first and showcase what we can do and then like on that, based on that, like start the ongoing billing. Now these days, the best solution we found out is that we actually take three months retainer or so and then get

03:05>> it from there. Typically then those like transfer it to like ongoing marketing.

Nathan Latka

03:10Makes sense. Give me more of the background story here. When did you launch the company? What year?

Founding Story: From Rovio to Geeklab

Jesse Lempiäinen

03:15>> Right. So it was actually 2019 when we got the idea. I was still working at Rovio back at that time and this was actually a problem that I had at Rovio. I was trying to find a tool that would allow me to actually, like, find out what would be the best app name for a new game that we were making. And I looked at the market, I saw one tool that didn't work and another one that

03:36>> costed like $60,000 for this one test. I was like, okay, there's got to be an easy way to do this. Called my friend. I said, let's fix this. He said, yeah, we need two other guys to help us actually build this tool. And then we got our founding team together 2019 and got our, like, first sort of MVP out in 2020, right in the midst of of COVID actually. So another COVID like spawn.

Co-Founder Equity Split

Nathan Latka

04:03There were four there were four co founders. Did you split equity evenly at the start?

Jesse Lempiäinen

04:08>> Not not really. We've done some shifts after that as well.

Nathan Latka

04:12Help I mean, it's a tough conversation. It's the first tough conversation you have as a founder. Right? So help our audience. How did you guys decide who gets what equity?

Jesse Lempiäinen

04:19>> Like, so so basically, we we just looked at, like, what everyone's doing. So so what are responsibilities and how much time as well, like, because we we sort of split it between all the founders jumped in into it right away full time and so on. So like that that was kind of the everything, also part of our company culture from starting from us founders was like no bullshit and that's what we live by as founders and

04:45>> we've lived by ever since. So that's how we got with with those tough conversations, just strictly talking about like things as they are and and putting things on the table and being honest about things.

Nathan Latka

04:56Oh, 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

05:20your Stripe account, you see your valuation real time. You can see what it 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

05:44get a 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

06:06not built 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

06:32going out right now and you're raising your seed round. We'll 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. All right. We're gonna go back to the YouTube video here in a second. But

06:53if you wanna 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

07:20the interview. So 2019, you get going. First customer that year. Walk us through how many customers you have now today.

Customer Count and Sign-up Funnel

Jesse Lempiäinen

07:27>> So currently today, like we have around 60 paying customers at the moment. So we're talking about like game developers mostly, 60 ish. Then we have a lot of, we have a soft spot for indie developers and smaller studios trying to make it. So we have plenty of free users too that we How many? All in all, I mean, we've had over a thousand sign ups and an actual, like, users. But

Nathan Latka

07:59Well, what does that mean? How many of the thousand sign ups have actually started, like, installed the software and started using it?

Jesse Lempiäinen

08:05>> Exactly. So a lot of those, like, over 90% has just like kind of looked around the tool and not really had the use case for it. So thing is that with our tool you can actually create like app store pages and kind of these app pages without actually having the app. So we've had a lot of curiosity out of actual people who would want to use the tool for business purposes just to play around with it

08:28>> and see how their own app could look like.

Nathan Latka

08:31Jesse, just to say the numbers in a very clear way. A thousand have signed up today. 90% have played around but then left. So a 100 are still sticking around and 60 of the 100 are paying customers.

Jesse Lempiäinen

08:42>> Around ish. Yeah. Those those numbers are

Nathan Latka

08:45Okay. Interesting. So 60 customers at a thousand bucks a month would put you at $60,000 a month today in revenue. Where were you exactly one year ago?

Bootstrapped Growth and Revenue Trajectory

Jesse Lempiäinen

08:53>> Yeah. Exactly one year ago, we were a bit over close to 30 k around MRR. And then we hit like 50 k MRR by the end of last month, last year and been we're now on track on reaching like a million ARR quite soon. That's that's currently our next target.

Nathan Latka

09:16And have you you bootstrapped or have you raised capital?

Jesse Lempiäinen

09:19>> So far, a 100% bootstrapped.

Nathan Latka

09:21Oh, great.

Jesse Lempiäinen

09:22>> But I I will say though that like that will change this year for sure. For all the other founders as well, they definitely know the pain if they bootstrapped.

09:32>> For us, we've sort of seen currently that it actually limits our growth quite a bit. Like say, have 60 customers now and one of the core things for us is to be very hands on on helping them to get the most out of the tool because when we can actually showcase the amount of value that our tool can bring, so then we make our churn negative because they share the growth stories everywhere. Gaming community is awesome.

10:01>> But like, for us to be able to do that, we actually have to have like, people hands on helping them and having the expertise in them. And bootstrapping with our margins is making it so, with these economies where we want to have buffer for our employees and make sure that they have a job to go into months ahead. So it's just, it takes a lot of time to sort of build up that buffer and then to

10:29>> kind of hire again to grow again.

Nathan Latka

10:31Well, Jesse, I mean, using,

10:34bootstrapping isn't holding your growth per se, because like everything you just articulated has nothing to do with growth. It just has to do it has to do with people that you think you wanna hire ahead of growth. Ultimately, if you hire the people, they've gotta be creative enough to go get new users. So where do you know you can spend money to go get new users and grow faster?

Why Bootstrapping Is Limiting Growth

Jesse Lempiäinen

10:49>> Right. And well, that's actually one of the things that we are now now like solving as well. Like currently, our sales pipeline is is quite focused on on founders as well and gaming community in general. So it's it's it's a lot about like outreach, participating on on on the gaming community, the events and everything.

Nathan Latka

11:12Yeah. How does money solve that? You said bootstrapping is restricting you. I think, I mean, from what you're telling me, it's like, how do you know it's money restricting you versus creativity restricting you?

Jesse Lempiäinen

11:21>> So, so like, we actually, by the end of last year, we we didn't take all the all the agreements in in December that we could have. So we actually put some agreements that we're just gonna start them in January where we knew that we were gonna get more people because we wanted to make sure that we actually have enough account managers to take care of them rather than us ending up on a situation where we actually

11:42>> were a bit, like earlier last year where we had a lot of customers coming in and then, like, not clear enough processes, not enough people to then actually serve them in a level that we we wished to serve them.

Nathan Latka

11:56Have served them. I mean, this sounds to me like a lot like agencies and agency margin. I mean, you haven't used the software to serve them at all. I mean, is this this is really I mean, this feels to me like an agency.

Jesse Lempiäinen

12:07>> Well, I'll put it this way. Every every single, like, campaign that we run are are 100% using our platform. So you can't run a single campaign. Even our agency, if you will, can't run a single campaign without utilizing our platform. And on the other side, we have customers that only use our platform where we just solve, like, technical related issues with

Nathan Latka

12:30Well, then why do you require hiring more account reps to onboard new people if they only use the technology? Why do you need more human why do have to throw humans at the problem?

Customer Segments: Enterprise, Mid-Tier, Self-Serve

Jesse Lempiäinen

12:39>> I guess it comes down to also the fact on our main customer segments right now. So we have three main customer segments. We have bigger enterprise solutions where we talk about the giants in the gaming industry. If you take a look at on our side you can see multiple of these. Rovio being being one of the examples, like then out of the ones that we can't disclose, if you take a look at top 10 mobile gaming

13:04>> companies, so we have plenty of those. And like with those, like they really, really want hands on help and someone from our team to actually help on the strategies as well. And then on the second tier, we have sort of a bit smaller companies that do like require that, like the hands on support, our customer success managers to help them. And then we have like the the self serve segment, which is currently the one that we

13:31>> have not optimized as much as the

Fundraising Status and Term Sheets

Nathan Latka

13:33Understood. I guess we're running out of time here, I do wanna say, you said very definitively when I said, are you bootstrapped? You said yes, but that will change this year. Do you have a term sheet in hand already or why why do you say that so confidently?

Jesse Lempiäinen

13:45>> Yeah. Yeah. So we've we've had plenty of discussions and and and actually multiple of those late last year and and now kinda just figuring out how to to move forward from here.

Nathan Latka

13:56Well, you didn't answer my question. Do you have a signed term sheet?

Jesse Lempiäinen

13:59>> Not yet.

Nathan Latka

14:00Signed. Okay. So, like, how do you convert those conversations into real action? Because a lot of founders right now are having conversations but the VC market is closed, I mean effectively closed.

Jesse Lempiäinen

14:10>> Yep. So where we found success is really by, well first of all, are profitable business so that puts us in a totally different situation than a lot of developers, companies just trying to make it.

14:29>> And just how you can actually articulate the vision. Think that's kind of the learning that I did over a 100 calls last year with VCs to kind of get to a point where we have multiple term and we actually have the opportunity to decide where to go. So, yeah, just But you just said you

Nathan Latka

14:53don't have but you don't have multiple term sheets right now?

Jesse Lempiäinen

14:57>> Yeah, we do. So I I say we didn't we have we didn't sign sign one.

Nathan Latka

15:01Oh, you do have term sheets, though?

Jesse Lempiäinen

15:03>> Yeah.

Nathan Latka

15:04Oh, I see. So I guess what are you waiting for?

Jesse Lempiäinen

15:09>> We're we're waiting for, like, we we we could have had this conversation in in about two weeks or so, And and I I could have been able to answer a bit differently. But but, yeah. Anyways, I'm I'm sure, like, that funding situation is is about to change.

Nathan Latka

15:26Jesse, the Sorry for being a prick.

Jesse Lempiäinen

15:28>> Yeah.

Nathan Latka

15:30It doesn't make doesn't make any sense what you're saying, and I'm trying to help my founders learn who are listening. You said you had a of calls last year. Macroeconomics are changing, things that are totally outside of your control. Right? Has nothing to with your business, but VC markets are shut down. You're saying, not for me, I'm gonna get a deal done and I'm gonna say it very confidently. My audience is gonna go, well, why is he so

15:48confident? Every even even other profitable bootstrap companies can't raise right now. No one can raise equity right now. Why can you raise equity?

Jesse Lempiäinen

15:55>> Yeah. Okay. So so I have some NDAs in place where where that prevents me from saying too much. But like like so we've actually signed, like, letter of intent already and and and so on, and and things are moving on on that front.

Nathan Latka

16:12Again, what I'm the reason I'm asking these questions is because, like, there's there's tons of VCs right now that are still taking meetings with founders, and those VCs are not deploying money. They just take the meetings that feels good. That's what they're supposed to be doing as a as a core VC. They're not actually deploying. I mean, how do you make sure this LOI, the term whatever that you've signed, how do you make sure it actually

16:29gets done and you you hedge yourself from these macroeconomic risks of the world economy going into a recession and impacting the VC you signed an LOI with?

Pre-Seed Round Details and Valuation

Jesse Lempiäinen

16:40>> Well, like one thing as well, like for us, it was like the hardest to get like that first term sheet. But as soon as we've got that, so then like all the other VCs got scared And and now we're in a situation where the one that we move forward with is going to be closed Yeah. Soon.

Nathan Latka

16:56How much are you hoping to raise?

Jesse Lempiäinen

16:58>> 1,500,000. Okay.

Nathan Latka

17:001.5. Interesting. And this would be your I mean, most folks in their pre seed round are selling, you know, 20% of the company. Are you sort of in that range?

Jesse Lempiäinen

17:08>> Yeah, yeah, a bit less than that, actually. So we were happy to make quite good terms.

Nathan Latka

17:14Yeah, so that's what like a seven-eight million post money valuation selling under 15% of the company, something like that?

Team Size and Headcount

Jesse Lempiäinen

17:21>> 12. 12 to be exact.

Nathan Latka

17:23Oh, that that's great. I mean Yeah. Yeah. I mean, that's great. I mean, you're I mean, so that that would that would be more than a I mean, you can do the multiple on that. Right? But that's a good multiple in this market. You you're confident that multiple will hold up as you go through diligence and actually work towards the money being wired and closed?

Jesse Lempiäinen

17:39>> Yep. Yep.

Nathan Latka

17:40Okay. Alright. Cool. And what's the what's the team size

17:42today? How many folks are full time?

Jesse Lempiäinen

17:44>> 13. Sorry. Full time. So actually, nine. Just got one guy left for student leave.

Nathan Latka

17:52Very cool. So yeah. Well, we hope you get everything closed. We're out of time though today. Let's wrap up with the famous five. Number one, what's your favorite book?

Famous Five: Books, CEOs, Tools, and Life Advice

Jesse Lempiäinen

17:59>> Monetizing Innovation. I would have said Lord of the Rings or something, business related, so monetizing innovation.

Nathan Latka

18:07Number two, is there a CEO you're following or studying?

Jesse Lempiäinen

18:11>> I have to say, even though this guy is a mainstream guy, so the Supercell CEO, Ilkka Pananen, us being heavily related, like heavily invested in gaming industry and and him, like, for two reasons. One, like

Nathan Latka

18:24Sorry. What was his name, Jesse?

Jesse Lempiäinen

18:26>> Ilkka Pananen. So he's the CEO of Supercell, the Finnish gaming giant. So

18:35>> yeah, he's also like whenever we talk with startups, it's either him personally or Supercell that's kind of backed them here in Finland. So that's, I think, awesome as well that they put the the success back to the market.

Nathan Latka

18:47Very cool. Number three, what's your favorite online tool for building geeklab?

Jesse Lempiäinen

18:53>> Like, I would, people will hate me for this, but I have to say ChatGPT has like just made so many processes so much faster.

Nathan Latka

19:05Great.

19:06>> Number four.

Jesse Lempiäinen

19:07>> Or or GitHub, GoHub. Yeah.

Nathan Latka

19:09Number four. How many hours of sleep do you get every night?

Jesse Lempiäinen

19:12>> Between five to six.

Nathan Latka

19:14Okay. And what's your situation? Married? Single? Kids?

Jesse Lempiäinen

19:18>> Married. Married for three three years now.

Nathan Latka

19:21Any kids?

Jesse Lempiäinen

19:23>> No. Not yet.

Nathan Latka

19:24Alright. And Jesse, how old are you?

19:25>> This company.

Jesse Lempiäinen

19:26>> 27.

Nathan Latka

19:27Last question. Something you wish you knew when you were 20.

Jesse Lempiäinen

19:33>> Don't invest in cryptos.

Nathan Latka

19:35Guys, there you have it. He was in charge of getting installs done at his last mobile gaming company, mobile app gaming company, and said, know what? There's no good tool for this. Let me build it. He launched geeklab.app in 2019. They're doing $60,000 a month today in revenue across 60 paid accounts, up from 27,000 a month just a year ago. They're looking right now at getting a round out round done targeting a 1,500,000 raise at somewhere near

19:5712,000,000 post money valuation. We're certainly, Jesse, rooting for you. Thanks for taking us to the top.

Jesse Lempiäinen

20:02>> Thanks. Thank you.

Nathan Latka

20:04One 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

20:29Central. 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

20:51fundraise, a big sale, a big profitability statement or else. I don't want you to miss it. Additionally, if you want to 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

21:13for 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, I do it so that we can all learn. We have to counter those people. We got

21:33to push them away. Click the thumbs up below to counter them and know that I appreciate your guys'support. Alright, I'll be in the comments.

Jesse Lempiäinen

21:39See you.