How Gus CEO Jaime Navarro grew Gus to $2.1M revenue and 45 customers in 2020.

hello everyone my guest today is pablo estevez he's lived in the united states for 10 years and then after that decided to move to mexico city to pursue a bachelor's in economics before founding his current company gus pablo participated in the management of a b2b sales team that was responsible for acquiring more than two million dollars in new ar for that respective company in 2015 he founded gus an ai company that works with clients like centender american express and cabify and 30 others to automate customer service and improve customer experience using chat bots gus has been selected as the diamond prize winner of mass challenge and is part of the endeavor national panel for mexico pablo are you ready to take us to the top yeah all right facebook just shut off a bunch of these chat bots that that move affect you um not really as a matter of fact we got a bit lucky um it was it was only down for two weeks and just the two weeks that we that we were down um we just kind of postponed putting butts and bots in production it really wasn't that bad for us they really just shut down kind of new bot connections but anything that was existing could still work no problem yeah interesting okay good so tell us about the company what specifically what do you do and what's the revenue model is it pure play sas uh yeah it's kind of like a funny hybrid of sas so what do we do we work with uh with customer service to automate automate customer service and improve customer experience how do we do it we develop chat bots which is kind of a very common thing but i guess our two differentiators is uh we focus exclusively in spanish so what we realize is there's millions of uh chatbot producers on the market but in reality very few of them are being are able to create great experiences in any language uh so what we said is hey let's let's not try to do 10 languages at a time let's just start with one um and right now basically our market niche is focusing in spanish for companies that have customer service needs um where we're basically automating anywhere between 80 to 96 in our most successful case of the customer service requests that a company gets 96 yeah and those were previously done by humans correct it sounds compelling so what's revenue at today so right now we're at roughly 50k usd a month okay great yeah we're focusing primarily on that in america so the price point is a bit lower than what it is in the states uh and the way we you ask for pricing earlier the way we're working is we charge a setup it's very similar to the last time we spoke and we charge a monthly fee based on the amount of conversations user has um and then once in that basic sphere um we we i mean the bigger the company the more specialized the pricing so with companies like santander uh it's very much a custom deal trying to bank right yeah it's a bank um so with them it's very much a private deal where we we we manage a team for them and we have like a lot of people on call for that company uh and and they don't pay anything for they don't pay a monthly cost in terms of how much conversations they they use they just pay a monthly cost in terms of how many people we have working on their yeah on their company what do you have today in terms of total customers on the platform right now we're roughly around 35 customers um maybe hitting 40 by the end of this month guys so if i take 50 grand a month divided by 35 customers each one's paying about fifth call 1500 bucks a month on average yeah but that wouldn't be so essentially what happened is when we started our pricing was a bit lower we had a lot of really small clients maybe startups right now our new focus is enterprise deals uh where we're basically seeing anywhere between um 10 to 25 000 a month so a lot of those con those 30 companies are paying very small amounts uh and right now one of our challenges to start stepping up the revenue for everybody so true or false there's one customer that makes up more than 30 percent of your current revenue uh almost true but not necessarily okay but close more than 20 percent yeah yeah you've got a lot of customers paying a very little amount and you have maybe one or two paying between kind of 10 and 20 grand per month and you're only doing 50. so you're really reliant on those one or two customers correct um make you nervous or do you actually get excited about that because it's clearly something that can scale i mean there's obviously there's a reason to get nervous uh but but i think i think it's more excited there's we basically one of our focuses for this whole year has been finding a niche in the market what exactly are we gonna do what are we gonna become very good at and what we're realizing is is there's a big demand for for enterprise deals for a company to come in to really get to know the company we're working with to create a completely custom solution uh and so right now we do have three three probably four by the end of this month clients are paying a lot of money but i think that number is gonna probably double in the next three to three months 20 grand a month though i mean is that pure play sass or are they really buying like humans on your team it's actually a lot of it's more like an agency almost yeah it's it's it's such a mixture right now we're trying to like make it a bit more standard and it's a mixture just because when you're especially in mexico when you're when you're going into these price points uh customers really expect to buy the way they want to buy um so so yeah a lot of it is actually people on my team but i'd say like a great majority of it is is like i don't necessarily need to hire five people for every customer i i close down so so like margins are good um what are margins uh roughly eighty percent okay i mean that's that's damn good if you're putting human touch on some of these things yeah i mean there's some pure place ass companies that are no touch sales or their margins only 85 86 yeah because often time i mean we have a lot of our workforce here in mexico we're charging dollars um so that kind of gives us a bit of leverage room and then yeah like what's the team size in mexico right now right now we're roughly 20 people full time yeah okay great and um and give for people that didn't hear your first episode when did you launch company what year so we started in 2015. uh originally with the purpose of launching a b2c like customer concierge via whatsapp um little by little we realized that that wasn't gonna scale and one of our main focuses since the beginning of the company was automating the chats um so roughly a year ago maybe a year and four months ago we said we closed the the concierge we focus now on just pure b2b uh and so we've been on this b2b model for a year and a year and four months basically and you're at 50 grand a month now take me back a year what what were you in terms of monthly revenue just sas revenue about a year ago uh i don't have that number off the top of my head but i probably less than 20. probably less than 20. wait less action yeah yeah good so i mean look good good growth right so maybe four or five x year over year is healthy and now have you bootstrapped to raise capital we raise capital how much so right now we've raised 1.2 million um and we should be reaching break even sometime the next two to three months so how much are you still burning today like are you talking like 10 grand a month 20 grand a month uh right now we're burning roughly i mean it depends but i'd say around 50. 15 000. that is that net or gross sperm uh that is growth burn um oh god okay so what's net what's neck bra okay so i mean you're about break even then yeah basically about break even uh i mean right now when i'm saying 50 i think that's 50 with the close of this month so basically our focus right now is reaching uh breakeven and and we want to focus internally on making this company a bit healthier uh manage so basically we have a very scalable business model right now what we need to do is manage our costs uh and we want to keep on growing uh but i guess the way we're looking at it now we're not looking to triple down on sales um i think we're gonna have once we reach break even we're gonna have a reflection period see what type of costs we need to have see what costs we can what do you mean though once you break even you tell me your revenue is about 50 grand a month and your gross burns 50 grand a month which means net burn is zero you're already at breakeven right no so basically what i'm saying 50 i'm saying we should close this month with 50. uh we're also hiring uh a few new employees 15 expenses or 50 in revenue we'll be closing this month with 15 expenses uh right okay so you have less we have less right now 40 uh yeah so we must give something okay but that furthers my point that means you're cash flowing 10 grand a month if you're doing 50 grand in revenue right like are you burning is your bank account right now going up or down it should be like around roughly around 40. sorry and by the close of this month it's going to be basically a 50. yeah basically i see the number because it's it's it's closed...