How Marketmakerleads CEO Mike Oddo grew Marketmakerleads to $3.2M revenue and 200 customers in 2020.

hello everyone my guest today is mike odo he uh is building a company called market maker leads he started selling real estate when he was 17 became number one in his market by 26 and has had multiple offices and mortgage companies got kicked in the teeth during the recession going from number one to number 47 and needed a better mousetrap to compete he built software used it to get back to number one took that beta software to market hit 20 000 bucks in recurring revenue in the first month sold that business and now has been been in software for agents ever since inc 5000 for the past two years mike you're ready to take us to the top yeah let's rock all right so market maker leads just to be clear you still have this company or you sold it i do i sold my real estate company is it what what what that said there very good okay so market maker leads you founded when you got kicked in the teeth to help you get back to the number one spot after the recession so what year was that when you launched um that was about let's see uh 2012 is when i officially launched so it was a little bit after the recession okay and help us understand what the products doing what do you what are you selling to real estate agents now so it's a it's a lead generation platform and uh crm tied to content marketing for real estate agents okay and what are they paying on average for this sort of thing uh our average customer uh pays a thousand thirty one uh per month you you did your research man you're looking after four cents yeah all right about a thousand bucks a month and why would someone pay you know a thousand versus two thousand per month in other words what are your packages going to look like yeah so so our our initial package started out at 14.97 a month we created a 997 package and what we found is that the average agent actually doesn't make a great deal of money so we've been backfilling with lower packages um you know this year actually okay and how many customers have you scaled to today um well i only have the core ones i don't have the smaller packages but we're sitting at about 200 of those core customers okay well i mean 200 core customers at a grand to pop per month i mean that puts you over 200 grand a month in revenue is that right right yeah okay and then just because that is pure play sas revenue no professional services no custom work right okay and uh that was that's up from about how much a year ago so what were you doing monthly about a year ago uh 19 was our was our uh 2018 growth okay so so 19 year over year growth there and then do you remember what you finished out 2018 with so about six months ago what we finished out with yeah well end of the year uh it was just shy of three million i wanna say two eight two nine in terms of your run rate in terms of total revenue generated okay sorry in december of 2018 that month do you know what you did i apologize um the deal's gotten out on me yeah mike it's fine in december of 2018 so about six months ago do you know what you did just in that month oh um i do not know off the top of my head i would say it's probably pretty close to where we're at right now probably around 200 okay so so so you're about flat i mean why is that why aren't you growing faster um well we kind of took a decided step back we were actually uh selling the product on the road and we were scaling very quickly um but the the type of customer we were attracting wasn't our ideal client profile and so we decided to put the brakes on it um and look to either build products that were more suited for the people we were selling we were selling real estate agents with a dollar in a dream that couldn't really afford our product we got really good at sales and marketing so we wanted to stop that put lower priced products to meet them where they were at and that's that's the endeavor that we're on now and it's really it was a churn play is why we did that what so what was churn and what have you gotten it down to um gosh back then it was you know uh as high as probably eighteen twenty percent oh wow yeah and so and so right now uh let's see what do we got we got uh logo turn at three percent revenue turn down to two point nine three that's great so that's about 36 percent revenue churn annually per year now what what enabled you to go from 18 down to you know three percent basically per month was it just changing the customer profile um no it was it was it was understanding the customer profile a little bit more and i think creating the proper expectations up front um you know a lot of times agents and and that's why i sell to his real estate agents they have a a kind of shiny hubcap syndrome so um they'll buy anything and then it needs to work now immediately they got to get a return on it this month because they slammed it on a credit card they couldn't afford so so getting the agent to understand how long it takes for our product to get up and running for them um it's a little bit of a sales prevention model but it gets us a better customer and in the end it's more profitable and we'll build a better foundation you know taking two steps back right okay good so 200 folks now more your ideal customer churn is down at 36 percent do you have any expansion revenue annually or no um define that that's like if you have a if you have a 100 of these customers paying and making this up 10 grand a month a year ago you'll lose 36 percent of that 10 grand so you're down at you know set 10 grand minus 3 600. do you do that same cohort the ones that stay do you get them paying more um we're working on that through the lower tier products uh to have a you know strong ascension model really to grow as they grow because that's kind of but not yet you can't point any expect okay got it so net revenue retention annually is about 64 100 minus the 36 percent churn i i would say that's uh accurate math yes okay and then walk me through kind of funding so how have you capitalized this thing are you bootstrapped or have you raised capital no just bootstrapped um never raised capital never uh really endeavored to or looked into it uh when we hit that inc 5000 list the first time a lot of phone calls um ignored most of them um you know it's probably a smart thing to do but just really not it's not my wheelhouse yeah well it's not smart if you don't know how to use i mean it's not smart if you you know don't know how to use money to grow because you're giving up to lucia i mean you're getting diluted right um what's it what's the team size today how many people fifteen one five and where's everyone based uh springfield missouri and dallas texas ah very cool okay dallas and i assume because you're bootstrapped that you guys are profitable or are you funding losses with your own capital no we've been profitable from day one very very profitable like how like you're talking 20 to the bottom line or 40 how much um generally at least 40 yeah okay that means you're taking about 80 grand per month to the bottom line on 200 grand top line revenue yeah yeah that's right yeah that's accurate um last year we invested more of that um into you know some of the things that i mentioned so not as profitable last year um once we hit kind of the sweet spot of what we want to accomplish this year uh we'll start cranking down more on uh profitability getting it raised back up okay but what is it at it's like last month you had a total of a kind of 200-ish grand in total income total expenses were about what um our profit last month was about 30 grand okay still i mean look by the way it's still not bad um no i love that i love i love profitable bootstrap sas company that's a beautiful place to be um how are you walking with a mousetrap how are you getting new customers um well content marketing is a big part of it we put out a lot of content through facebook live uh we recently launched a free tool which is a free crm which we're putting out and what's it called the pre-crm oh the free crm.com no no i'm sorry uh i thought i thought you yeah what is the free crm what's the website marketmakercrm.com okay market maker crm and how are real estate agents finding us uh pay-per-click on facebook interesting okay marketmakercrm.com wait this is interesting mike break down this for me so so what what what does it cost you facebook ad kind of ppc to get one new uh free user on the free crm um six bucks and some change okay and how many free users do you have to get to get one new paying customer to ground a month you know i don't have that exact metric but i do know that um what i look at is the amount that we spend in the return on investment and that in that that marketing campaign is profitable month over month so it's really not costing us any money and then we get the the the you know recurring reward so break that down right last month how much did you spend on facebook ads or ppc probably about 10 grand okay 10k and so so what how many customers do you land from that um because of the smaller products i don't have the exact number um because we're still...