Justuno Revenue & Valuation (2024)

hello everyone my guest today is eric christensen he's the co-founder and ceo of just uno an online visitor conversion suite that helps retailers monetize their current website traffic with lead capture pop-ups visitor tracking and more eric you're ready to take us to the top yeah let's do it all right man so um give us a quick background here the the company what do you guys do and is it pure play sass um yes i say it like that because we have introduced uh fully managed professional services okay uh joe sununu is a visitor conversion suite uh that at its core utilizes visitor data and analytics to help you capture more leads uh and sales far quicker than ever before uh we are a sas model uh but we do like i mentioned have the fully managed professional services arm well define that for us real quick so like past 12 months when you look at total revenue what percent was pure sas versus professional services would you say uh professional services is still small like less than ten percent yeah okay okay all right that's good and then help us understand kind of small business medium or enterprise on average order customers paying per year per month for this uh full range uh anywhere from what's an average though uh average you know 49 okay get you that i think it's like 53 if you look at you know the whole whole whole picture but you know the 19 plan is our heavier weighted plan obviously because there's more smaller businesses so this is i mean are you playing really in the realm of of kind of like sumo and kind of what they're doing what no is doing with with these kind of javascript insertions yeah i like to kind of put us right in the middle of the whole you know the main matrix if you're going to look at a you know a gartner quadrant uh we provide a a our platform is services on the lower end anyone with our freemium model so what we do is if you have under less than 5000 in monthly visitor sessions you have complete access to our platform so that you know we don't limit our light plan or anything and our belief is that any small business should have access to the same tools that any enterprise business has it's just a matter of how you leverage those tools and so we fully service the smaller end and then on the enterprise level we have our either our professional services or in 2018 we had really strong demand and growth like like most like everyone in the in the e-commerce and sas world we're all growing at the same pace i mean this market's still only eight nine percent of global ecommerce and then you know trillion dollar market yeah yeah so eric just to be clear when you say you put yourself on a gartner matrix that's not helpful because i don't know what matrix you're talking about i mean this is really smb conversion tools think unbalanced click funnels this kind of space yep okay got it yes we service that but also on the on the full high end all the way up to the top because with our platform it's it's it's an open platform where you can do anything any custom integration anything so we're servicing all full high-end so don't so don't name the logo because you don't want to obviously share that but the what the customer paying you the most is paying you how much per month uh we're going up in two to five ten thousand okay got it that helps me understand how like the power law nature of the business um okay when'd you launch the company what year uh december 23rd 2010. that was very specific well i'm running i'm flying to austin tomorrow we're doing our all hands company meetup and i i last night i was working on a historical company dock that's funny how many so how many people total today oh he just broke 40. oh congrats now and mostly austin uh yeah we're doing you know we're 30 plus in austin okay and where's everyone else uh san francisco which is our core where we where we founded and then santa monica okay um so you founded in san francisco and then opened an office in austin why did you identify austin as a hot spot to build the company in my co-founder travis logan he he got married was starting a family and wanted to buy a house and he was looking around at different areas and when he mentioned austin i was like yes perfect because we had big commerce illusion big technology hub and this was don't remember the date maybe five years ago mm-hmm horrible with time these days that's okay yeah um very good and then okay so let me get more the kind of the backstory here so you launched in 2010 um you expand austin because your co-founder is here and how many customers have you scaled to today uh depends at freemium you know we're 90 000 plus including freemium no no pick customers paying customers paid customers uh we broke 3000 in 2018. okay that's great so 3 000 customers and um walk me through i mean you're the guy to ask this question because you're probably eating your own dog food um what's the best way to convert you know 3 000 of 90 000 freemium users into paid what's where does the paywall show up guy you know what's so funny you mentioned dog fooding our own damn product we we as a conversion company we could even do better on our own site you know yeah it's like you know it it it excites me because every time i look at our business and what whatever department i look at i go wow we can improve that so just so just to be clear is really your only pricing axes the thing driving upsells and from free to paid is really once you pass 5000 views per month then you then you have to upgrade uh correct we do have the the full uh two-week trial so people use a product get familiar with it see the success and then want to continue on because it's helping their business but they can keep continuing for free if they have less than 5000 views a month correct okay interesting um see that to me is tricky because you really don't control um how many people like your product doesn't directly help people get more views per month it might help with conversions or exit intent or increase average cart value or things like that but but it must be frustrating for you to see uh your exit intent pop-up working on someone but they cancel because they don't know how to drive traffic yeah that's where the professional service arm comes in uh you know just like any business you hear oh i just don't have the time for it so what is your turn today uh sub five percent monthly what's gross uh that's net gross i gotta look okay so that's five that's five percent revenue term per month right okay um that's interesting so five percent revenue turn now you use the word net which means you must have some expansion to cover up some of the gross churn where's the where's what's the expansion revenue at typically each month uh business is growing um people coming in and increasing traffic and their business grows and we grow with them well so like let's be specific here if you look at the core that signed up of january 2018 they're now a year and a month in to their lifetime value on average what did year one annual contract value increase to by year two like they went from 50 bucks a month to 100 bucks a month or what was the average increase on average it's all over the place to be quite honest and we use chart mogul which is i recommend to every single sas company it's phenomenal when you want to dig in and look at specific questions like like you have if i were to look and pull up that report right now what i can tell you is people come in and uh we'll know in the first month if they're on the correct plan or not because they will go over their plan limit yep and that is where you know we offer them the the option have auto extras so that they can just add an extra few thousand traffic just to get through the month but as soon as they hit three you know it's really like we work with them be like hey we need to get you on the right plan so it happens within the first few months pretty quickly okay so you don't have meaningful after making sure the right plan you don't really have meaningful pricing leverage to drive expansion in years i mean in months you know 9 10 11 12 and onward i see one thing would be the the largest expansion pickup would be uh to be able to work with them to put them on our professional services plan will shin it also be if they 10x their traffic they should also maybe 2x what they're paying you per month yeah no i mean if they're gonna grow rapidly like that they will move up to the correct tier traffic plan that we have well that's my point though if you take the core that signed up a year and a half ago if your tools are working effectively and they're growing their business they should be getting more traffic and you know expansion revenue essentially those contracts are going to double year over year what i'm hearing says i don't maybe that's something you're not tracking not to like where they you know at what point in time they they expand yeah yeah so like if i asked you how long does it take a 5 000 view website to grow to 30 000 views on your platform you you don't know kind of an on on average what that cohort kind of analyst would look like we're not looking at those numbers i see okay um let's go into something you could break that down to pure play versus you know you have some businesses that go out of business depends if they're on shopify they commerce magento et cetera they're it's pretty you know we probably figured that out we just haven't what's your what's your full weighted cac to get a new 50 a month customer do you know yeah we we're so funny you know we're at 40 people now and i have a full-time marketing director and so i we finally are like digging into that type of stuff and um i should have pulled that report up but i don't have that exact number right now well what do you think what's a range what do you think it is uh it's it's extremely reasonable what i can tell you what is reasonable six month payback a year long two years um no like yeah less than six months okay so six months times 50 bucks a month you're saying you're willing to spend up to 300 bucks to acquire the customer yeah okay and where when you do spend um where are you spending besides sales people marketers and onboarding salaries so um definitely less than 300 i believe it was 163 is when i was looking but we also looked at which plan they were coming on that's fully weighted is that includes the salaries of sales and marketing people all that yeah so traditionally we're a 100 inbound business so i didn't have a marketing budget for five years um so when we look at the cost a lot of it was just people and resources which we didn't even have up until a few years ago so um where does it come in is historically a lot of it's been our relationships with the app stores however that's changing which app store has given you the most trials um shopify is the obvious okay um and but that market's really changed a lot so a lot of it comes down to position in the marketplace moving upstream and relying on more sophisticated uh solutions for for larger clients have you guys raised capital to grow the company are you guys are bootstrapped uh we're bootstrapped uh start founding was about 70 000 in and then we did a lighter capital loan oh yeah yeah okay good so how much do you take from lighter they go up to usually kind of a million or two million exposure 200. okay two okay you took 200 from them and what is that army when was that 2015 effect would you recommend it is it effective saved our business okay how so that's a big statement um we were our our runway was gone and it was taking too long to fundraise and it got us through what did that mean for i see you like gulping as we're as you're telling the story i mean what did it mean for you to be like stumble upon this life savior what did it mean uh i mean were you really gonna go out of business the day i got married i was max sold my car my partner was maxed out our bank account was empty and payroll was due in two days we had no money and i hear the baby in the background sorry i you know i can go check no it's great that's perfect by the way if you need to check go check but you can close the door no no i don't mind it i'm just saying i'm saying i'm just painting the story here 2015 married total debt you know car car up against well payroll is not going to be hit so how did you reach out did lighter find you or you found them or what um i was a founder in another company and he had no he didn't work with him i forget how i heard oh you know it was dan kurt i think he told me about them first okay so you did it and did they do typical terms with you they give you 200 grand and then you pay back like a 1.3 x repayment cap three to seven percent revenue you've got the bank with personal guarantees vcs with equity and then you've got like in the middle you know you've got loan sharks and then you've got like lighter capital kind of here where the interest is insane but you don't give up any control or equity so we um funny enough this month is our last payment okay so yeah it's it's pretty specta you know it's pretty incredible that it was very expensive up front and long term but um you just own the company still in the company and and it got us through so what'd you end up what's the what's the repayment cup going to end up hitting is it like a 1.5 x you're gonna end up paying 350 back on the 200 or something you know i believe i'm not at liberty to say but you're in the range okay they've been on the show before and i know what their typical terms are which is why i'm asking and then did you do it revenue like it was you paid back a percentage of gross receipts per month that's how you structured it and their software is really nice it's all automated so just once a month you go in and you reconcile it it actually helped us keep our books in order you know because like every month my bookkeeper was like hey look i just need you to reconcile my books for fighter capital i don't care about anything else because i run we run the business you know it's all about cash flows it's all about payroll it's all about um running your business kind of like i use like the millionaire next door model you you know don't spend more than you have yeah are you are you burning capital today or no no it's your break even yeah will you once you pay off this first thing from lighter will you go back for a second tranche or you want to try and do typical vc or just stay at breakeven it's a really good question uh and it's one that travis and i are reviewing uh currently um okay very interesting yeah i mean in terms of size you know 3 000 customers paying 53 bucks a month you're doing about 160 grand a month right now in revenue uh more than that okay have you broken 200 yet yeah okay and that's just be clear that's pure sass i'm ignoring professional services correct okay that's great good and what does growth look like where were you exactly a year ago in january 2018 you know what's fascinating is at least i think um we went through a near acquisition in 2017 okay and we learned a lot about our business um and really helped us in in this work chart mobile comes into it really helps us analyze and understand our numbers better and the difference between sat you know our sas professional services people look at gap all that stuff and we recognize that our sas was at 46 growth in 2017 and we ramped that up last year to 84 okay so you were doing then about 130 grand a month exactly a year ago grew at 80 to about over 200 grand a month today you love your numbers you're good i like it yeah i just i don't and you by the way you're not doing this but a lot of people just say we're the best or we're the top or where the i prefer to just know what the number is so 80 year over year growth and you're cranking past 200 grand today would mean you're doing about 130 grand pure sass a year ago in that range in that range yeah very good that's great okay um and why the acquisition fail uh two parts one they that company got a approach during the acquisition process um and so they got really stingy with their offer at the end they were what was them access don't tell me don't tell me the price of what they offered but what was the multiple they were offering was it like four five six x or stingier um it started in the four five but then went down to like three and we're like this isn't worth it like after that after you signed the loi at like 5x then after they did due diligence they made up excuses and took it down to three or something yeah yeah and you just walked away yeah would you sell today if someone offered you 5x yeah why not interesting very good by the way i like that you said that because honestly you're going to get 7000 phone calls and you're gonna if you do it right you'll create a bidding war and then remember your buddy nathan gets five percent yeah well i get an email about once a day from investment banking firms and i appreciate the timeline that's great all right man eric let's wrap up with the famous five number one what's your favorite business book favorite oh jeez um starfish and spider yep number two is there good and let me revert famous book business book is my uh military science handbook that i i still give out to my employees wait can can my audience buy that somewhere or no i doubt it i took an rotc military science class in college and it just blew my mind away um and oh come on you're teasing us you're giving us a book that is like amazing but we can't go buy it what's the closest book that's been published like to military science god i don't even know i read a lot of david mcauliffe can you send me a copy of this sure i'm flying to austin tomorrow i can bring one okay good let's get coffee i want to say how to be a capitalist dude this is my book man comes out in march yeah that's what we did we had no capital there see the book's for you no no i i seriously i'll trade i'll charge you books i'll give you mine you give me yours yeah i tell you what um can steal one of my employees copies that's how you get a copy come work with us that'd be amazing i'll come work for you for 60 seconds and then get the book and then all right number two is there a ceo you're following or studying um tom riley of cloudera he's i i wouldn't necessarily follow him i just get great advice from him yeah you know he's he's a great ceo they came on the show i to say yeah that he came on about um seven or eight months ago great company um number uh number three here what's your what tool do you guys use for billing we built our own it's inter what's it on top of like a curly charge chargify stripe authorized.net what oh authorized okay uh number four how many hours of sleep to get every night as we hear the baby these bags yeah i mean i'm an insomniac by nature um but how many five six seven it varies yeah sometimes i'll be up you know yeah five seven okay no and uh and you know we know you have one kiddo you have more than one or just one ah just one this one okay and married yup okay and how old are you 40 40. last question what do you wish your 20 year old self knew what it would that i wish i what was that what do you wish she knew when you were 20. oh that that your body is gonna what you do to your body in your 20s is going to pay off is you're going to feel in your 40s guys take care of your body come on from eric just uno conversion software for smbs 3 thousand folks paying 60 70 bucks a month doing north of 200 grand a month today and revenue up from 130 grand a month just a year ago uh they are bootstrapped outside by a lighter capital loan that works basically saved their business today operating a break even team of 40 in austin san francisco and santa monica five percent revenue churn per month again holding that down spending the call to 160 bucks to get a new customer so four month payback as they look to scale eric thanks for taking us to the top hey great thanks nathan