How Interweave Smart Solutions CEO Bruce Magown grew Interweave Smart Solutions to $6M revenue and 4K customers in 2018.

hello everyone my guest today is bruce mcgowan as the chief executive officer president board member and investor in integration technologies and the creator of interweb smart solution bruce brings customer focus solutions in response to customers needs to the digital age he served as ceo president board member and investor in secure digital the company that developed secure voice the voice data and video encryption solution designed to pass fips 142 certification and 2000 brew service ceo cfo and head of the audit committee an investor and board member of the uncommon media group and also served as president chief operations officer of noaa corp a privately held company focusing on interactive and media rich solutions bruce are you ready to take us to the top i hope so all right what is interweave and is it a pure place sas company as you focus on the crm space it is a it is a pure place sas company um what it's the origin originations were uh we're competing with tibco webb beyond a number of uh very large corporate integration engines and we morphed from about 2004 to 2006 when we met salesforce into a sas pure play took us about actually uh three years to convert that to a pure sas environment we we are currently at rackspace manage hosting uh been there since 2006. sorry okay so what do you mean by that you are acquired by rackspace no that's our isp okay i got it yeah so let's just focus on on on the company right now and by the way there's a lot of coding same interweave you're interweave.biz correct we are at century smart solutions dba the company's integration technologies yeah yeah that makes sense so give me a customer story i mean how's the customer using you i think a good customer story there's a number of others when we came into a salesforce sales source of financial applications quickbooks the sagemastline microsoft dynamics oracle all that the original customers were focusing quickbooks in 2006 at that time there weren't that many solution providers out there so we came forward and worked with a number of them to create what they wanted but in a configurable way that's the distinction here so what we've done is it's all objects all transactions and salesforce all objects all transactions in quickbooks and it's your choice via configuration so that's what's quite distinct so as far as business processing workflow the customer can implement theirs as opposed to buying a pre-programmed business process workflow from another vendor okay try and break this down well help me understand i mean are you going to after smb mid-market or enterprise smb mid-market typically i mean we've the the smallest customer has won the largest customers five it really is we are we are crm focused we are a crm integration platform with intelligence so bruce try and break this down to a price point for me what's the average customer pay you per month for access to your tech um the annual is anywhere from 999 to 14.99 typically one thousand five hundred yes okay okay so 1500 per year is a good average yes and and how how why would they pay more or less what are your pricing axes that you price on it really is uh we have four models so we have pro premier small business enterprise and it really goes to the type of integration the customer is looking for is it just ar focus and specific is it ap focus sorry try not to use acronyms yeah accounts receivable guidance or the combination of both i mean some customers get into very heavy multiple quickbooks company files by by currency by line of business multiple price books uh we we go very heavy and into inventory warehouses locations all these types of things so that's kind of one of the distinctions coming forward that interwe provides over others and would you say your main focus is kind of billing and financial platforms or is it more towards kind of databases and other web services no it's really focused on number one being financial integration uh solutions uh second would be uh billings and subscription we currently integrate with about 47 merchant service providers so we do quite a lot in subscription-based billing uh bringing that forward between the solutions itself and then we additionally ecommerce database we have typically i think right now 27 protocol specific adapters so if something has you know a protocol the way to work with it we can we can work with that and bruce put this on a timeline for us when did you launch the company what year 2000 2006. 2006 okay and over the past what is that 12 years how many customers have you scaled to um we've done about 8 000 today okay just be clear those aren't free unpaid they're just paying customers that's correct yes okay that timeline correct that's well and today you still have about eight thousand paying a little bit less but where we're the kind of focus in uh we've been very salesforce specific for a while there's two new vendors we're working with which is oro crm and bpm online so that's what for example uh bpm alliance when we opened our boston office in may of this year so uh very sharp uh very focused like a young crm salesforce so bruce sorry just be clear though so today how many companies do you have paying you for your technology about four thousand okay about four thousand got it so the people so basically what you gave me that eight thousand number was kind of anyone who's paid you anything over the past 12 years that's that's correct yeah so so the the the 50 of those folks that have essentially churned out why do they churn i think um for a number of reasons uh they could stay with uh you know arr they could stay with the uh crm vendor their wish they could they could stay with the financial solution that they're they're with some customers i mean for example uh started with quickbooks they wanted the sage line others have gone right to microsoft dynamics so it kind of depends on their needs um hubspot is a big competitor uh so i mean it really depends on their growth cycle their patterns and where they want to go and can i take kind of 1500 bucks per year average times that 4 000 today i mean that would put you at about 500 grand per month right now in revenue is that generally accurate that's pretty close yeah and and what were you doing in understanding growth rate where were you about a year ago oh no do you know i don't care not to check do you know generally are you doubling your over a year or maybe 30 year over year growth 30 about 30 yeah okay and are you doing this bootstrapped or if you raise capital no we bootstrapped it we're we're in the position right now we're coming out with a new branding and that's we're in the conversations with gartner currently those types of things uh i think we're moving more towards an intelligent crm integration platform as opposed to solution specifically does that tie back to kind of your decisions on funding yes very much well we we we focused in on being intelligent solutions and the ability to configuration to create the integration solution you wish i i think now with the extensions into more crms i think an intelligent crm integration platform is where we where we are and how we want to brand going forward sorry okay i'm confused so you bootstrap by the way impressive growth for bootstrap but you then immediately added kind of these other things you're working on are those direct is that are those directly i mean are you thinking about raising to build those things are they correlated it's it's the way we started in in the enterprise i mean we were a acs acs yeah out of dallas was the first customer i mean the first price point was 1.5 million dollars um that went down when you come to the salesforce the price point is what you know 48 dollars per month per license per user so we were an enterprise engine to start with what we've done we went then into specific sas solution focus and i but what's underlying is the platform so as mulesoft was acquired by salesforce i think that's the direction we should go as an intelligent crm integration platform what will help you beat mulesoft well i'm not going to other crm vendors that are coming up like orocrm like bpm online and others that i think would be a target market for us so you're just going to focus on being kind of the switzerland in between all of them we work with about seven currently yeah i think um you got to focus on what's what sales sources are what 10 billion currently they're going to 20 billion it's a pretty big company i think they've met as far as vendor acquisitions they're pretty focused in there they're achieving what they wish the other crms that that are coming up i think they're in the process of doing that and i think that's where we can add value bruce what's your what's your team look like today how many folks um very light we have six people uh uh six people in out of toronto we have uh 12 people out of uh out of uh russia okay toronto and russia so about 18 total yeah right that's great so i assume since you're bootstrapped you're casual positive correct we try to be yeah yeah well sorry i guess what i'm asking is if you do spend more than what you make in a given month do you just keep funding the company you just put more your own personal capital in or how do you how do you bridge that gap we do yes okay so so again how do you think about that in terms of kind of your overall life perspective are you just kind of any money you have sink into the company this is the long game or is it something you want to kind of exit and then go into something else well it's a long game i mean it's been a long game for quite a while i think right now it's a focus three year march and that's where the rebranding uh working with companies...