How Matter Made Hit $6.1M Revenue Serving 10 Clients With 12 Employees (Interview with CEO Eli Rubel)

Introduction and Matter Made Overview

Nathan Latka

00:00Hey, folks. My guest today is Eli Rubel. He's been a marketing adviser to some of the most iconic technology companies of our generation, including Dropbox, Loom, Calm, Productboard, and many others. His agency, mattermade.co, helps early stage companies reduce CAC and drive sustainable demand. Eli, you ready to take us to the top?

Eli Rubel

00:14>> Let's go. Alright. Let's talk about Loom first.

Working with Loom: Demand Gen Strategy

Nathan Latka

00:17I had the folks on, I think it was Shahed. I forget which one it was. One the co founders on right like, a week before they were launching the paywall. And he said, Nathan, we've been patient. We've got our viral coefficient built in. When you send a Loom and get two to sign up, it works. We've got 1,200,000 on the wait list. We wanna convert I think I'm going off memory. I think you said they wanted

00:32to convert 6,000 to a $10 a month plan, and they wanna hit a million dollar run rate within, like, the first twenty four hours. You worked with them early on. At what's were you working with them pre revenue to build that wait list, or was it post revenue once they, you know, had a million, 2,000,000 ARR?

Eli Rubel

00:46>> Yeah. This would be this would be post revenue. So this was essentially when I think they had raised a series a at this point,

00:55>> and they were trying to figure out how to cast a wider net. Like their goal was to increase work user signups efficiently. And so we launched this hybrid campaign for them, helping them lean into high intent channels, capture demand, and drive down their costs to acquire. But, I mean, at a high level, they brought us in when they basically didn't have a demand team. It was like maybe a demand team of one or two. We were

01:17>> brought in by an adviser of theirs, partnered directly with CEO Joe and his team.

Nathan Latka

01:23Is this is this typical folks use you? Right? They have one or two internal folks, but they really need more strength before they hire 10 people on their internal demand gen team?

Typical Client Profile: Series A and B Companies

Eli Rubel

01:31>> Yeah. I mean, I'd say that's probably the most common use case is like series a, series b, real small demand team. And, essentially, they they need to get to key growth milestones to get to that next raise, and prove some things out. But it's kind of risky to go and hire, like, a very senior growth leader because they might not have the budget for the growth leader and the growth teams, like the arms and legs to

01:52>> execute plus strategy. And so we're able to come in and be that senior strategy layer that's, you know, helped grow 10 plus unicorns a year, and also be their arms and legs, really help them figure out that initial foundational growth plan and program, what that looks like, help them establish baseline metrics such that they can go back to their board and say, we've built a demand engine. It works. Here's about how much it costs to scale,

02:15>> and then they can go and build out their team. So we're frequently

Nathan Latka

02:17What do you reverse engineer from? If you had to pick one metric that you say, it's this, and then everything else falls from this, what is it? Is it CAC payback? Is it CAC in general? What is it?

Core Metrics: CAC and Revenue

Eli Rubel

02:27>> Yeah. I mean, the two metrics we focus on are reducing cost to acquire and scaling revenue. So, it's like revenue or pipeline depending on who we're talking to and depending how long their sales cycle is. Right? So we might come in for a six month engagement. And if it's an enterprise sales product, we're not gonna be focused on revenue because their sales cycles might be six to nine months. We'll be focused on, like, quality pipe gen

02:46>> where the sales reps are saying, yes, these are really great conversations we're having. Whereas if it's, you know, a product led growth company like Loom or Hopin or Calm or any of these other companies we've worked with and helped grow, the feedback cycle is much more immediate. And so we're able to focus on it might be PQLs that they're really focused on, and that's the board metric that they care about. Usually, the metric is driven by

03:07>> the board wants to see certain proof points, and we reverse engineer from there.

Nathan Latka

03:11Oh, what's going on there, YouTube? Good to see you guys. Now imagine this. You love watching these interviews with SaaS founders, but imagine if we took all of the valuation data out from over 2,807 interviews I've done manually. Saves you a lot of time. Well, we've done this. We've built it into the beautiful interface inside of Founderpath. Check this out. I'll show you how you can access this in a second, but you log in, you connect

03:34your Stripe account, you see your valuation real time. You can see what it changed over the past eighty eight days and even set goals for valuation this year. Now the secret evaluation is there's many different ways to value a SaaS business. So the reason you're gonna see three or four different valuations inside of your Founderpath dashboard, this is all free by the way, is because depending on who's doing the buying of your SaaS company, you're gonna

03:59get a different valuation. A VC is gonna pay a different valuation. Private equity firm is different. If you're gonna do a minority sale, that's different. And if you sell the whole business, that's a different valuation. You can see all those when I hover over here. Right? So the teal is what a VC would pay. Yellow is what private equity And red is if you sold the whole thing outright. Now what's cool about this is this is

04:20not built off random data. Again, you guys hear these interviews on YouTube. All these datas are built from real time valuation data points founder share with us on the show. So traction 1,200,000 seed round 3.7 raise. They sold 22 of their business. Go in here and filter by the event. Maybe you only wanna see companies that have sold the whole business. Well, here are a bunch that have been acquired the valuation and the multiple. Maybe you're

04:46going out right now and you're raising your seed round. We'll go in here and look at all this recent seed deals that went down, what they raised, what valuation they raised at and what percent that they sold. There's never been a larger dataset of SaaS valuations than what you can get now inside of Founderpath. And we're thrilled to bring it to you. All right, we're gonna go back to the YouTube video here in a second, but

05:08if you wanna check this tool out, if you wanna jump in and sign up, you can check it out for free to get your valuation at this link. This link, founderpath.com/products/valuations. Or if you go to founderpath.com and hover over products, click on get your valuation here, and go ahead and sign up to give it a whirl. Again, all that valuation data live right inside the platform. I hope to see you there. Alright. Let's jump back into

05:34the interview. Yeah. Okay. Let me give you I I prefer to talk about one of your but I'm sure you can't because of NDA. So let me make up an account that I think is maybe similar to who you help. And then let's let's let's go through that. So okay. I'm a see I'm a I don't wanna use series x because we have a lot of bootstrap founders on who are actually bigger and revenue wise in

05:51terms of their series a competitors. But let's say there's someone listening right now. They've got 5,000,000 revenue. Right? Right? Whether they're series a or bootstrap, whatever, they have 5,000,000 revenue. Yeah. They're currently paying I'm gonna make this up a 100 doll let's say they're paying $400 to get a $40 a month customer, so ten month payback. They hire you. You come in. What's a good CAC? What target are you setting for a $40 a month plan?

Eli Rubel

06:12>> I mean, it's gonna depend there's so many factors. It's it's so hard to go, like Get me in your head.

Nathan Latka

06:21Talk out think out loud.

Eli Rubel

06:22>> Alright. Give me the metrics again.

Nathan Latka

06:24Yeah. So $400 to acquire a $40 a month customer, ten month payback.

Eli Rubel

06:28>> Okay. And so your

Nathan Latka

06:30question Eli, I wanna hire you. How much can you improve?

Demand Efficiency Framework Explained

Eli Rubel

06:36>> Yeah. I don't I honestly don't even know how to answer that with that. Like so let me let me give you an answer. Like, the our process is we we look at what I call demand efficiency. So most most people when they're talking about this space, they will they'll talk about demand capture. They'll talk about demand creation. And where we find the juice and what's different is we zoom out further and say, let's talk about demand

06:58>> efficiency, which is all of the different growth surfaces. And by surface, that could be something as common as, you know, like the actual channels and how effective we are in those channels, but it could be the soft tissue between touch points. Like when a trial comes in, how is that handed off between sales and marketing? Or is there an upsell motion that is triggered by in-product behavior that then there's a certain handoff. So, like, they're

07:23>> all of the life cycle nurtures, like, all of these different spaces

07:28>> where things can go wrong. And a lot of these companies, especially on the earlier side, ignore these surfaces.

Nathan Latka

07:34They are focused on Eli, that was really valuable. You just gave two soft tissue between touchpoint, how is trial handed off, is there an upsell motion triggered, and in-product behavior? Give me a couple more of those questions. That was good.

Eli Rubel

07:44>> Yeah. I mean, so okay. So, like, all of these surfaces cross between how they approach TAM, customer focus, revenue orchestration, top of funnel, mid funnel messaging, alignment, experimentation, retention. Those are, the high level buckets that go into demand efficiency. And then within each of these, there is there there are a number of kind of qualifying questions that will tell you how well you're doing in demand efficiency. I actually set up a a survey that scores companies,

08:12>> and they can, like, fill this out on their own and then get benchmarked against the industry leaders and see, like, okay. If, you know, if Calm and Loom are score a 93 in demand efficiency, like, you could see I'm a PLG company, like, how do I score in demand efficiency? And then they would essentially give you, like, a recipe book for what to focus on as far as low hanging fruit. So Mhmm. You asked for more

08:35>> specifics. I gave you categories. Let me give you more specifics. So, like, in TAM, it could be, are you trying like, a lot of a lot of early stage companies think of their TAM. They're like, yes. This is what I've been pitching my investors. Or if I'm bootstrapped, like, this is our total addressable market. I'm excited. I'm gonna go after everyone I can, get in front of everyone I can. But the reality is that if your

08:53>> budget is strapped, you need to focus on a specific segment of your TAM. You can't just try to boil the ocean or you can, but it's gonna be way less effective because you might only be able to get your impression in front of folks like once or twice. Whereas if you focus on 10% of your TAM, you might be able to get in front of them like, 15 times in a certain time period. Right? So that's

09:10>> like one little piece of it. You know, simple things, automated lead routing, automated lead booking, SOP between sales and marketing. A lot of time early stage companies will have a complex buyer journey that they've done a really good job. Like, the marketers have done a great job teeing up this person to talk to sales, and then sales will have no idea of all that historical context, and they'll just treat them like they're a cold cold inbound.

09:37>> Right? And so then then there's this disconnect in all the hard work marketing has done. This person thinks they're gonna go into this really, like, high quality conversation. Then you have an SDR saying like, oh, have you ever heard of that heard of us before kind of a thing? So there there are a lot of different examples like this, but in aggregate, it could be the difference between, you know, cutting your cost to acquire in

Nathan Latka

09:56>> half.

09:56It's huge. Yeah. It's huge. Okay. I imagine people are hearing you say this going, oh, I wonder what eat what tools Eli is recommending for all this stuff, automated lead routing, all this kind of stuff right now. What is, like, your your tech stack right now that you're just really bullish on?

Eli Rubel

10:09>> To be honest, I think people overinvest in tech stacks generally. I think that people generally think that tech is gonna solve fundamental problems for them that it won't. And so usually, step one is before I even answer that question, I would say step one is, like, get clarity on your buyer journeys. They're gonna there should be multiple buyer journeys. They should be segmented, appropriately. And then once you have just, like, from very first touch point all

10:39>> the way through to revenue, and you can very clearly define that from marketing's influence to sales influence to products influence to retention, all of these pieces, then you can say, okay, where are our gaps that technology could fill rather than this being manual. Right? And so Yeah. There is no one size fits all. I'd I really I'm not like a huge fanboy of anything in particular. It's just like, is the right tool for the job and

11:02>> what's minimally invasive?

Nathan Latka

11:03Yep. Yep. So it makes good sense. Okay. Let's talk more about you. What got you into this? When did you launch the agency?

Founding Story: From SaaS to Ecommerce to Agency

Eli Rubel

11:09>> I launched the agency in 2019. I founded a SaaS company before that. It was venture backed, sold that in 2014.

Nathan Latka

11:17Acquired Which company was that?

Eli Rubel

11:19>> Glider.com. We did contract lifecycle management.

Nathan Latka

11:22Oh, interest in hot space. Did you bootstrap that or raised?

Eli Rubel

11:25>> I I raised.

Nathan Latka

11:26Yeah. You did. How much did you raise?

Eli Rubel

11:28>> I raised, like, 1.4, 1.7, something like that. Acquired really early.

Nathan Latka

11:33To be honest, look. I put my freaking tax returns in the book. Right? So I rate bootstrap $2,000,000, raised 2,000,000 in VC, flash sold. I made no money. The the investors barely got the liquidation preference, but I learned a crap ton. So same question to you. Mean, was this life changing for you? Is it basically like a shutdown acquihire sort of deal?

Eli Rubel

11:49>> Yeah. So, I was waiting tables before this. I dropped out of art school, and I was basically like, man, I need to get my foot in the door in tech. I'm gonna pick the most boring, unsexy company I could possibly pick. Contract management sound sounded like the ticket. This, by Silicon Valley standards, was a total failure. Sold the company for $3,000,000.

Nathan Latka

12:08Okay.

Eli Rubel

12:09>> But for me, you know, I I walked away with a 7 figure outcome.

Nathan Latka

12:13You learned a ton.

Eli Rubel

12:14>> And I learned a ton. And and, like, the relationships that I've built and the trust that I've built from that became the platform for everything else that I've done.

Nathan Latka

12:21Yeah. How did you make a million, though, off that if you raised 1.2? I assume you had cofounders too. Right?

Eli Rubel

12:27>> I had a cofounder Okay. Who was no longer with the company by the time we were acquired.

Nathan Latka

12:32So I see. Okay. So you can basically take acquisition price of 3,000,000 minus whatever pref investors got, and then there's some there's some juice there to squeeze for you, which is great. Exactly. Okay. So you then pour all you pour all that into mattermade?

Eli Rubel

12:47>> No. No. I I I acquired an ecommerce company. I was really burnt out after that. I was like, alright, man. I gotta take a break, from tech. Acquired an ecommerce company to just, like, learn something new and give my brain a break from from the SaaS stuff. It was a dumpster fire. Like, I literally bought this thing. The guy was about to shut the company down. He was a brick and mortar guy in one of his

Nathan Latka

13:06How much would you spend on it?

Eli Rubel

13:08>> I paid $70K for Okay. Well the domain name and, like, some assets.

Nathan Latka

13:13Not bad. I mean, if your whole net worth was what you made off the Glider sale, that was only, what, 10% of your net worth? Yeah. Exactly. Yeah. Okay. So what happened? You just you kill it was you killed it or what?

Eli Rubel

13:23>> So I bought the company. This was an interesting one. This so I bought it. They were doing, like, 20 k a month. I got it up to I think was, 250 k, 300 k a month in Rev.

13:35>> And then realized that Amazon was just absolutely gonna destroy us, and there was, like, a roll up happening. We were selling motorcycle parts and accessories online. So I saw the writing on the wall. Was like, okay. I need to get out of this. I sold it to a PE firm in 2019, and that's when I started mattermade.

Nathan Latka

13:51Interesting. Okay. Was that a flash sale in 2019 or was that a good idea?

Eli Rubel

13:54>> That was like a no. That was like a I'm holding almost a million dollars in inventory that's all aging. It's like motorcycle parts. Right? So every year, it becomes more and more obsolete, the parts that you're carrying. In a warehouse That's so funny. We had 22,000 SKUs under management. It was nuts.

Nathan Latka

14:08Oh my god. So you sold this like a Thrasio sort of business or someone else?

Matter Made Business Model and Pricing

Eli Rubel

14:13>> We sold this to PE firm that was rolling up. They owned, like, bikebandit.com and a couple of other ecommerce motorcycle entities. Interesting. But the the hat trick here was

14:27>> buying this business allowed me to extend my QSBS exemption from Glider. So I ended up, like, the money that I made on acquisition was really just in the tax savings Yeah. From rolling the proceeds. It was great.

Nathan Latka

14:40That makes tons of that makes tons of sense. If if you guys wanna learn more about that, just Google QSBS and you'll understand. Okay. So then you get into mattermade. When did you so you launched that in 2019. Can you sort of share first year revenue in 2019 at mattermade?

Eli Rubel

14:53>> Yeah. That's a good question. First year revenue in mattermade was probably it was, like, $9,900 k, something like that.

Nathan Latka

15:00Okay. That's not terrible for first year agency, but you already had some chops about you. You sort of been through the ringer already. Yep. Yeah. And what were you sell so, like, if I was Loom approaching you not actually Loom, but if I was like a Loom approaching you, what are you doing? You're saying that here's a six month deal, it's $10K a month retainer or what?

Eli Rubel

15:16>> Yeah. Exactly. We were we had a monthly retainer, six month deals, exactly that.

Nathan Latka

15:21What and so what are you doing today? Same model?

Eli Rubel

15:23>> Today, it's a very similar model. So we have a paid media side of the business. We realized that most paid media agencies were, like, agency people starting agencies. And I felt like coming from SaaS, I knew how broken that model was. So we do a performance based model where we literally set our pricing based on which growth milestones we help them accomplish. And if we miss those milestones, our rate gets cut down and vice versa. Like,

15:44>> we make more when they win. And then there's the traditional side, which we've already talked about, which is like marketing org in a box. So they come in your loom and you say, hey, I've only got one to two marketers. I need like VP level strategy plus execution across demand gen, performance marketing, messaging, like all of the different services, life cycle marketing nurture, just come in and own the whole program for six months and help us

16:08>> get to a better place.

Nathan Latka

16:09That's that's the monthly still like $10K, $20K a month. You've increased pricing. No.

Current Clients, Team Size, and Revenue

Eli Rubel

16:13>> No. We were 45 k a month all of last year across all of our clients. And I would say times are a little bit different now, so we we've changed our pricing. It's a little bit lower.

Nathan Latka

16:23Okay. So okay. But still, okay. Got this isn't, for I mean, I say would if you're gonna spend $30K a month on a six month deal. Right? So $180K. I mean, you you don't obviously wanna be spending this unless you're doing at least four or five million bucks in revenue. Right? You need some history of deals, some cohorts for you to analyze. Precisely. Yeah. Yeah. Yeah. Okay. Very cool. And how many clients you're working with right

16:42now, like, literally in this moment?

Eli Rubel

16:44>> Oh, man. You're gonna make me do math live.

16:48>> Call it, like, 10.

Nathan Latka

16:4910. Okay. And how many how many employees do you have at the agency serving these 10 customers?

Eli Rubel

16:55>> We have 12 employees. 12.

Nathan Latka

16:59Okay. Okay. This is great. So 12 employees. So 10 times $30K. I mean, that's, like, $300,000 a month in revenue, something like that.

Eli Rubel

17:05>> Something like that.

Nathan Latka

17:06This is a very profitable agency.

Eli Rubel

17:08>> Yeah. Yeah. I mean, we did, we did 6.1 top line last year.

Nathan Latka

17:15A little lower this year or about the same?

Eli Rubel

17:17>> We'll be lower this year. Yeah. I mean, we were we were 37 employees earlier in the year. We we had to downsize.

Nathan Latka

17:24When are you spinning out when are you spinning out your SaaS company? I know you're working on it.

Spinning Off No Boring Design

Eli Rubel

17:29>> Dude. Can feel it. I I so funny enough, I I just spun off, we have this amazing design team. Like, they're doing design for Dropbox and Yelp and, like, really high profile clients of ours. And I realized that so many companies, especially like you you said your audience is, like, Bootstrapped or early stage founders, like, these so many of these companies wish they could have that level of creative for their campaigns and their brand and all

17:53>> their assets. And right now, up until this point, they've had to work with mattermade and pay that giant monthly retainer to get access to our design team. But I was like, you know what? Let me spin off our design team and have it be, start at 2,500 a month, get design exactly when you need it, not be held up waiting for the product designer to ship your, you know, marketing assets, that sort of thing or brand

18:13>> assets. So I just spun that off. That's my new baby, in addition to mattermade. That's called noboringdesign.com. I love that.

Nathan Latka

18:23Yeah. Okay. So no SaaS no SaaS, though, then. Not right now. You will. There I've There's coming. No doubt about it.

Eli Rubel

18:29>> Yeah. Eventually.

Famous Five Rapid Fire Questions

Nathan Latka

18:30Interesting. Okay. Cool. Alright. On that note here, let's wrap up with the famous five. Number one, favorite business book?

Eli Rubel

18:36>> Oh, Never Eat Alone.

Nathan Latka

18:38Number two, is there a CEO you're following or studying?

Eli Rubel

18:42>> No.

Nathan Latka

18:43Number three, what's your favorite online tool for building mattermade?

Eli Rubel

18:48>> I live and die by HubSpot.

Nathan Latka

18:50Alright. Fair. Number four, how many hours of sleep do you get every night?

Eli Rubel

18:53>> Nine and a half.

Nathan Latka

18:54That's I love that. What's your situation? Married, single kids?

Eli Rubel

18:58>> Married. One year old daughter.

Nathan Latka

19:00Oh, that's exciting. How old are you?

Eli Rubel

19:03>> I am 34.

Nathan Latka

19:0434. Last question. Something you wish you knew when you were 20.

Eli Rubel

19:10>> Enjoy it.

Nathan Latka

19:12Guys, he had his first SaaS company a couple years ago, raised 1,200,000 and then sold for 3,000,000. Still managed to make a bunch on that because he was really the the major shareholder there. Then said, you know what? I'm gonna use this money by an ecommerce brand. Failed miserably. Flash sold that. Then got into mattermade where now he works with some of the fastest growing brands you've heard of, Loom, G2, these kinds of fast growing

19:29SaaS companies, helping them decrease CAC or increase revenue and drive more pipeline. Charges on average, call it, 30 or $40K a month in revenue, currently working with 10 customers, and they'll do about 3.6 this year up from or sorry, down from 6.1 last year, but last year was VC dollars flowing everywhere. It was the heydays. Now getting and now spinning off his design agency to do that, continue running this. I think he'll have a SaaS business

19:50one day. We'll wait and see. But in the meantime, Eli, thanks for taking us to the top.

Eli Rubel

19:53>> Yeah. Thanks, Nathan.

Nathan Latka

19:56One more thing before you go. We have a brand new show every Thursday at 1PM central. It's called Shark Tank for SaaS. 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 1PM

20:21Central. 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 SaaS world, whether it's an acquisition, a big

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21:05that at nathanlatka.com/slack. In the meantime, I'm hanging out with you here on YouTube. I'll be in the comments for the next thirty minutes. Feel free to let me know what you thought about this episode. And if you enjoyed it, click the thumbs up. We get a lot of haters that are mad at how aggressive I am on these shows, but I do it so that we can all learn. We have to counter those people. We got

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