Jotformrevenue

hello Rowan my guest today is Steve Hart hurt he is the CMO chief marketing officer at job form comm with responsibility for marketing programs brand management and corporate partnerships prior to joining job for me as president of heart hurt and associates a marketing consultancy that worked with b2b and b2c companies Steve is more than 25 years of marketing management experience Steve are you ready to take us to the top yes I am let's go all right so job forum gave you a big juicy chunk of equity to convince you to leave your own company and join them right tell us tell us what job forum does and what's the revenue model how do you make money sure I mean what we are is were online forum builder you know previous to our system if you wanted to build a build forums you had to be a program we had to be a coder and forums can be quite complicated well what we developed was the very first drag-and-drop interface as a SAS product where somebody could just literally say I want these fields I want first name last name on one address I want I want to get a payment or whatever other fields they want and they can create online forms it's very simple very very easy to do and what's the business model is it a SAS play yes we're very much a SAS play what we have is we have a free product so people can test-drive it as long as they want but as they you know as their needs grow and they need more forums or they need more features we have tiered paid products that appeal to various levels of companies that's great and give us a sense I don't go down every single co-worker's I'm sure you have many what's the average customer paying you per month would you say the average customer in our product line starts at $19 a month or our bronze plan and they go all the way up to $99 for our gold plan but right now we've got probably our average cost or average revenue per user is probably somewhere in the mid 20s since we've got a pretty good mix of people okay that's fair enough that's good understand and then help us understand how you got involved with the company was joking when we started but the company was launched in what year and when did you join in why sure the company was launched in 2006 and I think what's unique about jawed forum is we've been a bootstrap company since day one we've never taken one dyno today still today still today we've never taken one dime of any investor money it has been company has grown organically and that's just how we're going to continue to work it we have no plans to take any kind of money from any investors at this point where I came into the picture was about two years ago Ida can tank our CEO approached me and kind of laid out the job forum story told me where the company had been where he would like to take the company and basically made such a compelling story to me and you know told me such a where they wanted to you know really the future where they wanted to go it was very difficult to say no and I thought I talked it over with my family and we said you know it's one of these opportunities that come along probably once in a lifetime and if you're going to jump and grab that ring now's the time to do it and and here we are now you joined you know eight or not almost nine years after launch were you still able to I mean did he incentivize you do you have at least some equity in the company you have some of the upside or no yes yes he did give me some equity was very generous on the equity so that you know obviously that's very helpful when you want to sit there and keep building a company but you know it was also he gave me the challenge he gives me the freedom and he as he does everybody here I think really to kind of just do it the way you think you need to do it you know we're not my no.1 in this company as micromanaged we try to be a very many we are about 75 people in total and and that's you know that's a mix of programmers support people the marketing team obviously and such like that so in San Fran know we've got people actually based all over the world we've got it we've got our headquarters is based here in San Francisco but we also have a programming group that's based out of Ankara Turkey we have support people all over the country there are actually all over the country and all over the world so we can provide 24/7 support to our users just to kind of give you an idea of the size of the company and where our footprints at we have users and about a hundred ninety two different countries around the globe so just about every you know just about every piece of dirt on the planet we've got a role in it somehow we this isn't a couple of I think it was in September maybe it's October early October we crossed the three million user mark for the first time which is phenomenal growth for us and you know I mean we just don't see any end in sight to where this company is headed that's great and what have you grown to now over the two years you've been there what do you guys out now right now in terms of total customers using you guys I mean total customers the growth has been over 50% when I came on board we had just crossed a two million mark so it took us about 10 years they go from 0 to 2 million users and in really the last 18 19 months we've been able to add 50 percent more user base and our you know we're actually in that if you look at our growth it was very slow and steady and for the last you know say 18 months it's climbing big time so the hockey stick is starting to very much happen for us that's great I want to talk more about that but just to be clear all of those 3 million are paying they're all paying customers or there's free users there's a mix of paid in used paid it for I should say paid in creek okay can you give us a general idea of how many folks are actually paying for the platform that one I'm gonna have to kind of hold that card fairly close but it's a it's we're above industry average let's just put it that way okay and you'll have to educate us because I just don't know what I mean is industry average five percent of users 10 percent a twenty percent of users pay so it's about six and a half to seven percent of average and when you have a freemium model like what we have but I say our user base our paid user basis is beyond that okay that's great and we're how do you get that average number what who are you comparing yourselves to they're really worth comparing ourselves to other saps companies when you know we did some research and you look at what other SAS companies are that offer the same kind of freemium model that we do that's really where we fall into place and we know it's great you know we're above where that industry average would be it that's great and see I want to give you credit where credit's do so hopefully doesn't make you nervous but you know at a minimum if you're beating 6% you got three million users you have over 180,000 paying folks right and if they're paying an average of 25 per month you guys are doing well north of 4.5 million bucks a month is that generally fair to say yeah I would say that's pretty good any what to the bubble okay good that's healthy that's good understand now your CMO this is a very it's a it's a very competitive space and by competitive I mean keywords for anything related form are very expensive to buy how are you acquiring customers you've got to get creative I imagine yeah we do I mean we use multiple different channels to get to get our customer base growing I mean what we've found works very well for us again is the key word are CEO works quite well we have a tremendous growth in our organic search and that's really where people find us and we've been very very deliberate in how we structure that so what we found is by addressing specific challenges that companies face and and using that as our foundation on the SEO that's where we're finding the growth is coming from because people have a particular problem that they're trying to solve and they pop it up and we show up as that solution and then they sign up and we're up and running at double how do you discover more terms people are searching for that your product helps them solve we constantly look at I mean there's a lot of different ways we do it one is we talk to our customers all the time so we're constantly serving them to find out what they liked about is how they find us what were they trying to solve or what problem they were trying to solve and then we also just look at general search terms where you will go in there just do search terms on our own to see what pops up so we might do something that's to say I need a contact form or I need an online contact form and we will see what shows up as far as is that one of our competitors is it something completely random that you know no one ever knew about in someone we structure that way you start the picture search to develop and show you where that path is that in which way you need to go with it and if you kind of back into today what you're paying to acquire a customer or maybe not what you're actually paying but a different question is what are you willing to pay to acquire a customer currently I mean really what we're willing to pay is you know I think we would go as high as maybe 20 to 30 dollars per acquisition per a paid customer but we're not paying anything near that to be honest with you because again because the way our the model works for us when they come in and they will then they will generally come in as a free user to start with we do get a certain percentage that come paid right off the gate but we get a certain percentage that will come in as a free user and then when they said they will stick around as a free user probably for say six to eight weeks maybe nine maybe not 90 days and then they start to see the value and their needs grow and then at that point it's like well I need them I need to purchase the product cuz I need additional forms or I need more form submissions or I need additional features maybe they want to take more online pay something along those lines and then from that point then they come on and then the long term the long term of a customer for us as and we measure that in years how many years do you soon they stick with you usually I recorded our measurements we have an average of right around three years that's what a paid customer so you can see if we're looking to go in as high as twenty dollars an acquisition cost or maybe in 30 dollars an acquisition cost and we're multiplying sayed even if they came in at the low rate at $19 a month times thirty six months that's pretty good yeah I mean you're let's just use the twenty five dollar number since that's your average that's $900 in lifetime value across three years right yeah that's interesting and so just to confirm it's fair to say you're spending significantly less than 20 bucks to acquire a new customer exactly okay and your pedigree is obviously healthy in this kind of space I've heard sometimes churn is difficult right high volume low ARPU um what is your guys annual turn right now and what are you doing to drive that down yeah the I mean we've been studying our churn for the lat really since I came on board and what I'm looking at on the churn our churn rates are probably their average their average for our space we want them to go lower educator to see what is that yeah I think this in the space itself it's around 5% is probably your typical I actually five to seven percent I would say probably your typical turn and that's local churn monthly that's that's actually that's that's the monthly churn but on logo or revenue on that's just that's users the revenue the revenue churn is is almost insignificant to be honest with you cuz it's all the same price point you have a lot of expansion ARPU right exactly so we're looking at I mean when we're looking at what the causes of our churn art is we've been able to identify some very specific causes of what's what's driving our churn rate and we're actually gonna be developed we've got a plan in place that we're gonna start putting out in the next really next probably two months that we think is really gonna significantly drive that down come on Steve you're teasing me what's the plan the plan really is to is where is the head off the problems before they pop up we have found what's really probably the biggest driver for us is when people have their their credit cards expire right when people just forget to do payment and we've identified that wait a second these people are just forgetting to update their payment and so that's causing them to fall out and by identifying that group earlier on we're able to sit there we did a test on that and we found yes when we alert them and say did you know your payment's going to expire now we're finding that those people go oh I wasn't aware of that and then they go ahead and then they update their payments and they stay on as a paying customer so that that churn element does not happen I can't say that this has been done or that I've done it or anyone I know has done it cuz I have no idea if it's legal or not but in their general idea of breaking rules I mean many people the most successful churn reduction they've had in this kind of at this kind of price point when they realized the expiration date was the biggest issue which 60 70 % of turns sometimes is just actually guessing right the new updated year of the expiration has significantly driven that down now you can do that in a variety of different kind of ways in terms of doing it the right way the wrong way but it makes complete sense why that's what you're focused on right right as we identified as probably our biggest piece of churn yeah and by looking at that going well we know cuz if somebody signs up we understand what their payment process is because we when they sign up but we get their expiration dates on their credit cards and so what we've done is we just flagged it to say okay now starting at you know somebody's going to expire say January 1 2018 we're recording this here on December 1st we would start sending those people out notices now to say you need to update your payment yep and guys you just heard kind of the recording date and remember I do so many these interviews if you want to not have to wait you're probably hearing this in March if you want to not have to wait so long can go to get Latka calm where I publish them instantly so just just to call out there to check that out now Steve the the last question I have for you before we wrap up with the famous five usage metrics that you know tie directly to increase lifetime value you want to push forward on the onboarding as much as possible what is the number one thing you know you have to get new users to do in the first seven days to make them significantly more sticky right I think for us it's engagement it's to actually does sign up for the product we want them to actually start using the product more than just I want to create a basic form and so we have found that the more engagement we can get with a user the hey did you know yes most of them will come into want to create a simple contact bar but when we used when we show them how to create say an online payment form or how to create an online survey or how to make an extensive kind of form that uses things like conditional logic when they start to see the sophistication that the product actually has that's when the stickiness factor suddenly comes in the into play and that's when those customers will be much more of a long-term customer than a short-term customer how do you know whether they're to focus your energy on like them just getting the fort like them just logging on then them just getting the first form created then actually launching and embedding their first form them actually getting 20 new opt-ins to the form like how do you know which of these points you should put most your resources - yeah we've our metrics team is incredible and I do fantastic work and we've actually been known what to look at so many of our new users to see what that usage pattern is when they come on board and so we identified if somebody came in and just created a simple form kind of like created and then walked away we found that the engagement fell off immediately but we found that by going in there and continually to educate those users in that first 10 days of them as a new user that basically did you know you could do this did you know you could do that with a job form here's how you do it we found that by showing them a path of how to do it significantly improve the engagement and those customers then create more forms and then we start to become a much bigger piece of their daily workflow as a company makes a lot of sense let's wrap up here in a second Steve with a famous five last question you mentioned about twelve months ago you were at about two million four users you've grown significantly since then up to three is that also translating to revenue in other words are you are you you're not seeing decreased conversion right as you increase volume of new free are you know I've actually seen an increase in conversions which is which is great that's exactly we wanted to see I mean if you look back again over the history of the company the conversion rate stayed at a very specific level but in the last 12 months that conversion level has started to climb and so for us it's a matter we know that the more customers we can get in now we can the percentage that we're going to Rover is growing yep and and just to be clear you said you're beating industry average of 6% I mean we can say between 6 and 15 percent somewhere in there right okay Jeff and if you've grown by 1/3 over the past 12 months I mean if you're at you know above 4.5 million a month today go back 12 months you guys were doing what to 9 something like that yeah a general Rindge healthy growth Steve let's wrap up here with the famous five number one what's your favorite business book probably my first famous business or my favorite business book is gonna be the Steve Jobs bio by Walter Isaacson it's good one number two is their CEO you're following or studying right now probably Tim Cook I he's a very fascinating individual and yeah he's a very interesting person to follow number three is there besides your on with your favorite online tool Twitter number for how many hours of sleep are you getting every night about five okay and what's your situation married single you have kiddos Oh girlfriend girlfriend and any kids are now oh yeah my kids are older their and their mid mid to late 20s now if you can play that's great and how many I have two boys two and how old are you Steve 57 years old 57 years young last question take us back 37 years what he was your 20 year old self Neil I wish my 20 year old self knew probably said a better sense of direction and where to go I think if I spent a little bit more time paying attention than my finance classes in college I would have saved myself a whole lot of grief early in my career there you guys have it from Steve he wishes he would have spent more time understanding finances earlier on in his career was doing his own thing and in the jock form crew came along and said Steve you have to join here's a big juicy deal he does back about two years ago now jaw from his growing launched in 2006 they've passed over 3 million free users well over 6 percent of those paying so they've grown over the past 12 months from about 2.9 million bucks a month in revenue generally to over 4.5 million Steve's driving churn down from 5% to monthly logo churn focused on driving that down super healthy economics right now they're spending less than 20 bucks to acquire new customers with a 36 month lifetime value at 25 bucks a month that's 900 bucks an LTV again less than 20 bucks in CAC so healthy their payback period happens in the first month which is great their team of 75 based in San Francisco and the remote offices focus on making online forms significantly easier Steve thank you for taking us to the top oh thanks for thanks for the opportunity