Legit Check By Ch Revenue & Valuation (2021)

hello everyone my guest today is daniel c h he created legit check by ch with his brother david who's 17 and they've gathered over six million all-time users their company helps people authenticate luxury items like clothing sneakers bags and watches they're currently making 200 grand per year using the simple send order note function of an e-commerce system daniel you ready to take it to the top yes i am let's go you've got two things you've got this tool and then you've got another tool called price unlock touch quickly on price unlock what's it what's it do price unlock is being built right now because of a need we have so we need to a b test prices to give a practical example i don't know whether 999 990 9 sharp or 10 a month is what would work best for us and then we also need to localize some prices so price unlock is meant to find and set to help you find and set the perfect pricing for your sas tool well that's pre-revenue pre-launch yes so at the moment it's not even a fetus it's just being conceived so to speak all right let's go back to legitcheck.app the headline on your website says authentic fake let's find out what's the business model it's very simple so uh we're first and foremost a media company more than a tech company so this actually didn't even start as a business i in 2017 i was i wanted to learn how to make an app and i found out that i don't really like it that i actually hate making apps but i did go through and finish it so it was literally just a glorified bookmark folder because i've also written a few guides on how to tell fake yeezys fake freyro williams shoes that's what was cool back then and then i just let it there and long story short in the meantime has just grown it was i i got very lucky to a point where um i think it pulled in a hundred thousand users before we made an android app and then three hundred thousand users before made into a business so to answer your question the business button was simple this is our bread and butter we have some other things as well but people send us pictures and we come back with a verdict we tell them whether the item is fake or authentic and then if they got scammed if sadly we need to bring the set of news that the item is fake we can help them get their money back if they paid via paypal or via credit card okay and what year do you launch the business first line of code uh no code zero lines of code no i'm joking that's actually uh like there is code in the background as everybody knows the app was was uh released in 2017 november but then it became a business in april 2019 so that's when we started earning money out of it and how much did you make in 2019 if i had to guess because i don't really know i would say 20 30 grand i'm not really sure and how junior brothers put that um brotherly so to speak in our family we're a communist uh as much as there's a negative connotation i shouldn't say that um just like everything is is within the family so you guys just it's all sort of profits you put it back into the family is it now still today just the two of you guys working on it it's mainly the two of us uh so ownership it's yes it's the two of us but then we also get the help from some other people we employ some developers some people to help us authenticate um but sorry were you asking ownership or what's the total what's the total team's i say full time between eight and ten i would say something like that okay and why is that fuzzy like don't you know i mean wouldn't it be obvious who's full-time and who's part-time why does it fluctuate the question is whether i need to make myself look bigger or not so that's why i wanted to give an honest answer we have some people on some longer-term full-time freelance partnerships but it's not like employment employment so that's why that's why i'm just a bit finicky when it comes to this number got it so between and how many are engineers um five okay so heavy heavy in tech and what's the model how do you guys make money people pay us we come back with a verdict and i was just making this post the other day about how that verdict is being sent through anybody seeing this if you've ever used an e-commerce platform you know you have a function for sending an order note like hey your order is a bit late sorry for that so that's how we send our verdict now the reason why i'm doing this and why i made the post and this interview as well thanks by the way for having me is we're leaving that behind so that was just a scrappy way to get off the ground we didn't ever imagine we're going to make six figures out of it low six figures i have to mention so we're coming out with something new pretty soon same same business model but something more um elegant than just a scrappy send order notes and um that's what it is is it a recurring model or people just pay you one time when they want to get something verified it's a transactional so one-off people pass one time but 40 people of the people come back and part of this what are they what do they pay daniel one time for one verification anywhere between 20 bucks and 100 bucks depends on the item but bar most of our items are priced at 20 dollars but if you've got a hermes berkey that's going to be a hundred bucks and how many verifications did you process last month um six seven hundred somewhere like something like that okay and is that the main growth driver like that's all you're focused on is getting people more verifications per month uh honestly our focus is to uh bring more mortars because we have six million all-time viewers of our guides and that's really our main main product i know it's not as fancy where can we view that daniel what's the link let youtube.app and if you go in the navbar get authenticated there's going to be a button that says explore the library so that's where we've written about a million words on how to spot fake items so what i forgot to mention earlier is that people can pass 20 bucks or 100 bucks but we kind of shoot ourselves in the foot i guess quote-unquote by giving people the free guide so if anybody wants to learn where sorry where is that frame on get authenticated i don't see a link to a free guide anywhere sorry so say again in the nav plot there should be yeah a button that's this yeah and then oh no my but my memories but library the first button explore the library i said with a blue badge free guides here got it so these these have gotten over six million views is what you're saying yeah pretty much okay and this is how you bring new people paying 20 bucks to get verified they trust you through your content yeah so it's a lot it feels like a lot of work to write all that so you write all this personally no no we get help from people we got into a point where we we have a system put in place where we have some internal guidelines on how to make a guide how to test it how to make sure you know things don't slip through the cracks and that's basically our expertise that's why we we beat our own john that we have uh earned expertise not self-claiming because there are other people doing this but they just set up shop one day and they say i know how to authenticate but that doesn't have any any claim any backing to their claim yeah so 700 verifications last month that 20 bucks a pop means you did about 14 000 bucks in revenue last month is that about right uh the arp is a bit higher because we also we charge 60 bucks for our certificate so if you've gotten scammed with fakes and you wanted to get your money back we each are 60 bucks and we make that into a nicely looking letter that is trusted by banks by paypal by amex for that matter so more like 20 or 30 000 last month in revenue oh i wish it was that high no last month we have all this public by the way last month i think we we are very close to 15 grand okay but then the previous month we're doing a bit better as we were riding the wave of unfortunately the the coronavirus pandemic so what was total revenue in last year 2020 uh 2020 i don't know i can look it up your phone but what i've checked for that post was that may to may so may 2020 to may 2021 it was 200 000 and it should actually be a bit more because we've made some charges outside of woocommerce right so let's say 220 000 something like that yep yep how are you splitting your time obviously i get more excited about price unlock right you're building a tool so that you can use on your own you know application my gut tells me that that's the thing that's going to take off over the next five years um yeah who knows i mean i hope to link back to this specific episode and say look nathan predicted it what's the url where can people check this thing out by ch group dot com slash price minus unlock i have price unlock.com but i can only start using it in three days from now so save the link one more time by chrome yeah.com slash price dash unlock okay got it pretty soon price unlock dot com when when i'll get that domain when everybody gets unlocked what are you waiting for why can't you launch this like right now and have and have customers on it this looks like it's ready to go um i started collecting email addresses um it's still being built because we started building it last month and trust i mean i understand where you're coming from i designed it in four or five days and the demo can hopefully show more than four or five days of work um we'll show something that looks like more that more than four or five days of work is still being built and it's about to be released as a beta by the end of this month so i'm i mean i'm doing that thing where if you release it and you're still ashamed of how it looks like that means you released it at the right time something like that yep well i'm signing up i'm setting up right now pricing testing is one of the big areas that a lot of sas founders leave money on the table uh they should be way higher it should be way lower so i'm curious to see how you're going to end up testing and really launching this i'm on the waitlist yeah should we talk about this now should we keep talking about legit i can tell about either of them no we can go back i mean we're about out of time but i want to make sure i touched on price unlock as well since it sounds like it's a sasha building yeah that's actually our headline what you just said stop leaving money on the table to which i sometimes add maybe stop taking too much money from the table because that's the thing you don't know whether you're pricing too high or too low most people price too low we know that but what if you're actually pricing too high and you know i just wanted people and myself actually to have some knobs to turn when it comes to pricing you know kind of like a like being able to experiment by turning the knobs that's what i mean yeah now if if price unlock takes off uh would you sell legit check app if someone offered you 200 grand up front all cash just for a year of revenue yeah well probably not gonna sell regardless of even if i'm getting a very juicy multiple because um in my head it could be way more it just needs to be a slow burn because it's bootstrap completely push up so no vc money it's a problem today it is well it it's pretty much we could operate on 95 margins if we fire everybody and do the authentications ourselves so there's a fancy word metric which i don't know the ones net income i don't know how much money you make before only after putting the discretionary and like like founder discrimination yeah that one that's the one yeah okay very cool that's good profitable good to go launching a new tool we're gonna watch you carefully let's wrap up here with the famous five number one favorite business book there's not a business book per se but it helped me become a better business person the power of now no doubt about it that's a good one number two is their ceo you're following or studying scott galloway number three what's your favorite online tool for building a business get latke.com you really use it or you're just trying to make it feel good uh a bit of both i'm not gonna lie but i actually use it because some of your episodes are um look i was looking at applecare the other day we're going to use upload care and then i said hold on a second let me see if these guys are not going to just go bust in two years with all my pictures and then you had an episode so gitlatch.com was up there yeah there was that was a good episode all right number four how many hours will sleep to get every night at least eight nine is really the answer and what's your situation uh married single kids uh no kids i'm building my future with my partner who i respect and love a lot she's she's great and she's actually been uh not only inspiring to me but i look up to her i can say that proudly that's great and daniel how old are you 23. 23. last question what's something you wish you knew when you were 20. that was yesterday man this isn't this isn't maybe when i was 13 no i'm joking um [Music] building wealth is a function of saying no that's what i would tell myself guys there you have it legit check app launched a couple years ago with his brother uh they did 30 000 in 2019 their first year in business and then 2021 last 12 months they've done about 200 000 in revenue they help consumers submit pictures of purses and bags and watches and then they verify it for between 20 and 100 bucks a pop they did over 700 verifications last month but now he's frustrated with his pricing is it too high too always building a sas tool called price unlock to figure that out we'll see what happens next daniel thanks for taking us to the top thank you for having me i'm honored one more thing before you go we have a brand new show every thursday at 1 pm central it's called shark tank for sas we call it deal or bust one founder comes on three hungry buyers they try and do a deal live and the founder shares back end dashboards their expenses their revenue arpu cac ltv you name it they share it and the buyers try and make a deal live it is fun to watch every thursday 1 pm central additionally remember these recorded founder interviews go live we release them here on youtube every day at 2pm central to make sure you don't miss any of that make sure you click the subscribe button below here on youtube the big red button and then click the little bell notification to make sure you get notifications when we do go live i wouldn't want you to miss breaking news in the sas world whether it's an acquisition a big fundraise a big sale a big profitability statement or something else i don't want you to miss it additionally if you want to take this conversation deeper and further we have by far the largest private slack community for b2b sas founders you want to get in there we've probably talked about your tool if you're running a company or your firm if you're investing you can go in there and quickly search and see 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