How Infoscoutinc CEO Jared Schrieber grew Infoscoutinc to $30M revenue and 184 customers in 2018.

all right good morning everybody my guest today is Jarod Schreiber and he's the co-founder and CEO of a company called info scalp where he leads that startup that has fundamentally changing the way brands understand and engage consumers in a 21st century previously led research product and services for retail solutions where he shaped how 500 plus CPG companies leveraged POS data to improve sales and execution at retail during his tenure the company was recognized by AMR his storied past includes a few hacks at MIT co-founding the Pat Tillman foundation throwing a job when I'm playing Australian rules of football Jared are you ready to take it to the top all right what's coming out commonality between Australian rules football and the info Scout business model holy cow we're aggressive I was doing that without a doubt we take no prisoners there are no sacred rules that we follow unlike many of the traditional incumbents that have been around for 50 years in the market research industry I'd say we're pretty ruthless by comparison I like that okay what's the company doing how do you make money is it a peer place ass it is not a pure place ass we have a very big project and services based component that is how we get started with clients it creates a low-cost way to prove the value of what we do and then we use that to fund our sales cycle into the account to actually sell them on an ongoing subscription so we actually use projects and one-time project based revenues to fund the sales cycle of a ongoing subscription and generally if you look back at 2017 total revenue what percent was from kind of the professional services versus what percent was from the ongoing recurring yeah I'm going recurrence about two-thirds of our revenue and project or about one third that's actually I mean it's pretty healthy so let's we'll circle back to how the project stuff helps you onboard customers and they pay you basically for it but for now let's just focus on the SAS component when people pay you a monthly kind of sassy what are they getting yeah so typically it's around $250,000 entry on an annual basis so annual subscriptions they're getting 10 licenses for access to insights platform that allows them to ask questions of consumer behavior where are people buying a particular category of product are they loyal to a particular brand how much do they respond to a promotion which brands do they switch between those are the kinds of questions they can answer through our platform and generally speaking about how many customers do you have on that sass platform yeah we're supporting a hundred and eighty four different brands right now on the platform okay now I mean can I can I multiply kind of the ARPU you just gave me times 184 to assume you guys are doing about 3.5 a month I wish I wish were that that big we we surpassed 30 million this last year okay well what do you mean you wish you were that big that's that that was accurate sorry you know that's 184 bucks times that price point of about 250 grand a year right or they're paying about 21 grand a month that puts you at about 3.5 million a month and Mr R which is a little off but still it's close it's about 30 million yeah yep now how are you guys I mean what does growth of like year-over-year in other words what were you at about 12 months ago at the end of December 2016 yeah we're more than doubling on a year-over-year basis and that's impressive how are you driving that growth oh well what we built a product that not only zero-turn associated with it but those customers subscribe to more modules and it has more users to those modules on a year-over-year basis so our net revenue retention is a hundred and eighty nine percent from existing clients so it's more about growing business with existing clients that it is landing new ones guys so you're very much in the net negative revenue a kind of churn at this point you got it I have been day one okay okay interesting and when was day one they want to go to markets in terms of starting to sell subscriptions was April 2014 and why did you go that route usually agencies tend to go the SAS model when they start thinking about raising capital they realize they get a better valuation if they have a technology component oh boy well I would say my co-founder and I thought we were building just a data business to start or at least a data and software business and what we quickly realized is there had to be a decent services component and project-based component up front based on how our customers were going to buy what they expected from a service provider in this space I think Nielsen and I arrived ease billion dollar-plus incumbent to trained and trained the market on what to expect and what to buy and and so we couldn't just walk in with a software-only solution start god it's a 2014 is when you launched kind of a SAS pot from when did you launch even just to professional services stuff only about seven eight months prior so ok yeah well it was a long time prior we started with some projects got some wins and that was enough to convince a compromise to make it bet on us with with an actual software product and what's the team size today 145 and then we're guys all based mainly so we've got about 60 in San Francisco about 30 in Chicago 20 in New York and the rest spread out all over the country wherever our clients are in sales and services roles interesting now take me back to kind of the first few months how did you land the first customer what was that first first strategy yeah well we went to going to a trade conference really and which one in front last networks oh my gosh I think it was like shopper insights in action it was so specific to our particular particular field of understanding shopper behavior and shopper insights and just started networking talking to folks tell them what we were building and you know one of those handshakes led to a follow-on meeting which led to a first project and I think all of $3,000 in revenue do a survey of our panelists and six months later they were signing up for a four hundred thousand dollar subscription what was first total first year revenue back in 2014 do you remember how little it was but you know I'd have to count the 2013 we ended up doing about two hundred thousand dollars and then 2014 our bookings were actually four and a half million so we we really hit the gas and our first year of actually selling any type of capability or solution that's one Kaymer went from almost nothing in revenue to for an athlete a booking recognized revenue was probably only around two got it so you were selling some kind of two-year contracts no it was one-year contracts but if we sold them late in the year we only had maybe a month or two to recognize revenue on them I see I see got it so two and a half recognized four and a half booked ish I mean it's incredible growth what would you I mean I don't take this as a job but you're an engineer you're MIT I mean how did you drive those early sales you bring on a sales person earlier yes idea that fortunately I think some of my prior roles I picked up a little bit of a sales habit myself but I brought in a sales exactly would work for me before at a prior company and he just lit it up that's exciting now what percentage of your team today is dedicated to sales well we've got about 35 quota carrying sales reps today between a little bit inside sales mostly direct outside sales in the field and when you take a new account you're paid spend plus their salaries to generate your fully weighted CAC what are you spending right now to acquire customers oh let's see here we are spending you know it's interesting terms acquire customer right because that could be a project customer at $10,000 if you will let me just do the math and get it right here every time I want it I want to say it's about 25 to 30 thousand dollar customer acquisition cost well if you've got customers paying you 250 grand a year on the sass platform that's about 20 grand a month I mean you're getting your payback in less than two months still right it's fast once we get them on the platform the reality is we end up with a lot of project work for the first six to nine months so it's not as clear in terms of what that payback period is but the math works out quite well at the end of the day we've been a project work if you're billing a five grand or 10 or 20 grand project obviously that helps to recover CAC pretty quickly yeah let's shed some light on that for a second you're upfront kind of professional services fee right what are they getting and how do you typically price that so what they're typically getting is the ability to survey our analysts and specific questions about why they bought a particular product on a particular trip why did they choose this brand over that brand why don't they buy this time and not last time why do they buy it at this retailer or not that retailer when they like about the product versus competition that's super simple or why are they stop buying their brand why did why have they switch to a bit better benchmarking those kind of things so it often involves surveying our panelists and getting some answers to some business questions the end deliverable is kind of an executive ready PowerPoint presentation of our findings from doing that survey of what we would recommend around it and we're good takes a month or two to deliver the work and and ends with a PowerPoint presentation and where are you getting most of your data from I'm sure you have some proprietary stuff and I'm sure you also kind of pay for access to certain things...