How Meet CEO Aaron Lifshin grew Meet to $200K revenue and 100 customers in 2018.

hello everyone my guest today is aaron liftion he's the ceo and founder of meeting pulse he's got a 20-year track record creating and managing award-winning technical teams in the us and the uk his last successful exit was xln telecom as cto aaron are you ready to take us to the top absolutely all right still here yeah thanks for joining um what is meeting paulsen what's the revenue model how do you make money a meeting pulse is a new type of audience response system which gathers a real-time sentiment as well as a q a and polls from audiences and uh our revenue model is uh and services software and services okay so how do you you know one common theme i've seen in the sas space well in the event space where they try and use a sas model our events start and they stop so churn is always an issue have you solved this this solution somehow or do people keep paying you even when there's not an event going on in the event i see a lot of opportunity to really add value around the services but uh you're absolutely right you know there is going to be a you know there's going to be one-off and then if that relationship is created then you then they come back for the next year because usually if they've organized it this year they're going to organize it next year but where i really see the value of the application of the technology as well as a good business potential as an enterprise and getting this into internal events and regular meetings so give me a general sense i mean you have some enterprise logos listed on your website on average what's a customer pay per year to get access to the technology you've built it varies but it's uh it's in the thousands okay yeah i'm just curious like if we're talking like a thousand or a hundred thousand per month or per year i mean are you talking like four or five grand a month or a year or what no no not not ten not usually our largest customers it's the tens of thousands okay customers to start to start out would be in the thousands um and uh you know it really depends and what we see a lot is uh there is a virality of spreading inside of the largest enterprises with this kind of technology what we see is a kind of mix of an old b2c model where somebody else would see it and bring it in and we're using a similar thing to spread inside of an enterprise where one department head will will bring on bring the technology in and use it for their meeting but somebody else attends so then they so then they bring it into they want to have it in their meeting as well and so as we spread then that revenue uh of course scales out the usage so you'd you'd say you know two grand a year is called you know a fair average for the folks you're trying to cater to uh that is about our uh our average value but that includes all of those one-offs um so for the larger enterprises um our price point is closer to 4k but you're you articulate it even though you say one off they might pay for a month cancel but they pretty regularly come back year after year correct well that's the goal uh you know that's the goal i think the event space is one offs and there is a lot of people that just need it for that for that one time um and we see a lot of uh a lot of downward price pressure as well with a lot of entrance into the market for those uh for those single events um but the goal always is to to build the relationship identify those uh agencies that are going to do more events and that have a more sophisticated clientele and then bring uh bring that relationship forward and and get them to come back but that's certainly something we're working on are you trying i assume you're tracking that so it's probably a bad question i mean are you tracking that and if so how a lot of people have troubles tracking churn if it's not like per monthly like some people have a lot of trouble you know tracking they they paid in november this year they canceled for 11 months they paid in november again that's actually a good customer uh yeah i mean you know that's a challenge and and we do it with some manual work especially there's turnover in those companies potentially so you might get somebody coming in with uh with a different different email uh so what i do is i just um you know i have i have admin uh matching those up and as long as the domain is the same then then you know then it'll get matched up and then also you know there's the question of churn like what do you consider churn if somebody comes up and they only ever needed it for one you know for a one-time use you just never you just never count you just never count them as a customer at all that's what i would do right they're never a sas customer they're in a different model so in this industry it's like it's a mix of models there's this one-off model the more standard sas model for people that have more events and then the services model as well where we really are seeing something emerge which is uh interactivity consultancy around events you have your av guy your sound guy your caterer you have your interactivity person and we've seen more and more expectation of that and uh and a new a new skill set and a new niche in that event ecosystem that's emerging around providing that service telling people when to ask questions when to enable interactivity to be most effective to get those feedback and engagements sure yeah the product makes complete sense to me um i want to understand more of your story here when did you launch the company what year uh 2014. 20 okay so four years and what have you scaled to in terms of total customers and let's just focus on the one cohort let's just focus on the true kind of soft sass customers yeah so we are we are between 100 and 200 customers right now and we've taken a lot of time to really listen to what people were coming in with in terms of their problems and uh and develop the product and we started really marketing out and growing the sas business in may of this year okay um so so it's been a kind of a learning and product development uh uh phase for us for a while and now it's an exciting exciting time and we're about to uh uh to scale and uh and go back and trap pretty much bootstrapped we had a little bit a small accelerator that we went through and the the story of it actually is uh it was a hackathon uh started company it was me and a few guys got together for a weekend to just see what we could do see we could put together and and on the back of that we met some people that that gave us 50k to kind of take this to the next level and it was around the pulse the real-time sentiment and analysis so how many people are on the team today uh full-time part-time about a dozen people okay about a dozen people okay so i mean have you gotten to the point yet where you're casual positive or you're operating right at breakeven are you burning still now i've started burning a little bit more with this uh with this increase in uh uh and marketing effort okay so now we're gonna move into uh more of a fundraising fundraising stage but i've kept it i've kept it bootstrapped and just growing the product and building out to the point where really whenever any customer comes in and like oh can i do this can i do that we always want to be able to uh just say yes and support that so we now have um close to 200 different features and different ways to use the product and aaron i mean i can i can back in a little bit here to minimum size correct me if i'm wrong here but at a 2 000 kind of average annual plan and you said between 100 and 200 customers on the sas model i mean that would put you guys that caught at least a 200 000 kind of ar run rate on just the sas line is that accurate that's about right yeah okay and and if i asked you growth rate on that so go back a year you'd say zero right because you just launched it in may we launched the marketing in may but we did have customers so we doubled oh yeah one year so about eight grand a month a year ago yeah is that right about eight grand eight grand a month a year ago uh 100 yeah it's about right about right yeah that's good that's healthy growth where are you so how are you signing these these folks up um what's the what's the number one growth channel we use google adwords and we get a lot of referrals we get repeat business and just the organic you know as soon as we put this up there we had organic you know aaron that's not just like a magical thing like everyone who puts up a website doesn't just like magically get traffic you had to do something whether you realize it was smart or not you had to do something to get traffic um well for a while it really uh it really wasn't we got a few influencers uh that came and saw it um you know we uh we launched at the launch festival we were at the hackathon people saw us there so i think that that helped us kick us kick us off um and then from there it uh it was organic for uh for a while and that's um you know that's a lot of why i just uh kept kept sticking with this business because there were just always such positive signals around what we were doing so what it sounds like you do have experience and and uh a cohort that you do have direct paid spend acquire customers what's your full awaited cap look like to get a new two thousand dollar a year customer right now we are looking at depending on how you count around 400 500. okay so your payback's pretty quick then for four or five months yeah yeah but again you know our numbers we're still young so i'm always i'm always testing and skeptical about these numbers numbers look very positive for us to be to be ready to scale but as we get uh you know as we get more data and more volume um you know we'll keep we'll keep looking at it totally look listen there are always diminishing returns if there wasn't then you'd find one channel you'd go all in and there'd be tons of like huge companies that will never stop growing but the fact is diminishing returns happen and the smartest entrepreneurs find new channels new gold welds to go mind and it sounds like you've got a little infrastructure set up to go find those new wells yeah absolutely and um i try to i try to really keep open to the signals about the different needs in different industries where this is necessary so i'm finding an online broadcasting space very interesting for this a lot of the competitors i'm seeing really focus on the event space event and conferences and uh there is uh definitely kind of easy quick uh quick gains uh quick money there but then also in the enterprise in the university space and the education space in the broadcast online broadcast space i think there's real interesting opportunity uh for meeting pulse and other similar softwares what does your churn look like today and how do you measure it this one is uh this one is a it's a tricky one because as we talked about it's like who do you count uh you know how do i count in the churn churn is definitely a lot higher than i would like right now um and what is that they're like what you're trying like 30 40 a year it's not something where i could uh i'm prepared to really disclose the numbers but the numbers are not great and um but like we don't know what that means erin like when you say not great i have no context on that so like how do you know they're not great [Music] that's a good question um i would like i would like more customers to kind of to kind of stick with the product uh for longer you know and some of our in some of the larger enterprises we gain enough traction um where people start to expect it um expecting expect the tool to be to be used but um and some of the uh in some of the smaller use cases you know we don't uh we don't get the traction and maybe let me ask a different question then what would your target what would your target retention be i think year on year you know i'd want to be below 30 percent in terms of churn yeah in terms of churn yeah yeah i keep 70 of of customers year on year but i find it's um it's just really competitive space there's new entrants all the time and there isn't really like a standard you know this is who i go to for live interactivity during my meeting i just don't think it's i just don't think it's a sas model i mean honestly i've interviewed probably 30 companies in the space i just don't think it's a sas model i think that's the problem they try and fit themselves into a sas model that's just not going to work for events i think that's right what i've seen the more successful with events is something that's a lot closer to like a consultative service model yeah yeah um so yeah i think i think you're right about that yeah we'll see i've definitely yeah i definitely struggled with that like trying to you know how do you how do you make this work with sas yeah do you have any plans to raise additional capital yeah we're looking to uh to raise now uh start actively doing so in the next in the next few months and our our ratio looks good in terms of the lifetime value and the acquisition cost so it's looking uh like we can go out with some strong numbers and uh and get uh uh get something done in your ideal world how much would you raise we're raising a one million seed we're considering it a seed round okay so you'd want to raise you don't want to raise a million there and we've uh and we have we have some of that committed yeah how do you so let me ask you a question i mean you mentioned already three different business models three different kind of pricing structures like the one time there's the sas and then there's essentially like the consulting the strategy work when you go and have conversations with vcs they're obviously going to say no you're an agency we're going to value you at 1x and you're going to say no we're sas we get 6x right valuation i mean how do you have those debates uh yeah i mean i think for us it's about um you know talking about our inroads into the large enterprises and uh you know what i'm really interested in about this business is its potential to change the way that large organizations operate and uh inject cultural change into uh big corporates and i think that that's that's the message that i'm gonna go to investors with and i think that's exciting and it sounds like you're still now that excites me and i have to and i have to find an investor that that's that's exciting too as well yeah it sounds like you're still probably negotiating this but in an ideal world i mean let's say you raise a million bucks what valuation would you love to raise that uh we're going out we're looking to raise up seven million seven pre-order well it's a convertible note uh convertible no round so uh so it's uh it's a valuation cap yeah yeah seven seven cap yeah very good it sounds like you do you already have a term sheet you already have people that have committed we've committed we've brought in some funding um some early kind of to kind of spark the round and get it going and help us uh you know help us build up and go out there and uh yeah moving forward with it why go i mean have you looked at other alternative forms that are like non-dilutive like have you looked at venture debt uh not closely with another one um i have some connections as well to the to the crowd funder um crowdfunding of of investment um so we looked at that a little bit more but uh it's something to consider i think yeah well i mean so so what would you i mean what what do you like about the venture debt model or dislike about it it's something that uh that i need to do a lot more thinking of my experience is really in um more so in organizing teams and products it's a little bit less than financing so i'll move forward and continue taking advice yeah yeah very good all right let's wrap up here with the famous five number one what's your favorite business book right now i'm liking uh reinventing organizations number two is there a ceo you're following or studying right now um i think what's happening with elon musk is really interesting number three how many hours of or sorry what is your favorite online tool for building your company oh i laid on asana quite a bit okay asana number four how many hours of sleep to get every night uh between seven and nine i need a lot of sleep to function that's good so it's called eight there an hour sometimes sometimes i hate that but yeah it's a good thing and what's your situation uh married single do you have any kids i'm single but i have a partner and okay no kiddos looking for that no not yet okay and how old are you 41 41 last question aaron what do you wish your 20 year old self knew hmm what do i wish my 20 year old self knew um you know to forge uh i wish i knew really better how to listen to uh i kind of still wish i i knew that better how to listen to myself and uh and forge uh forge my own path from uh from listening deep within guys listen more to yourself aaron again launched a meeting post back in 2014 now today serving caught between 100 and 200 uh paid accounts on their sas model paying about two thousand dollar acvs so they're doing call it 16 17 grand a month right now or about 200 grand in arr that's about double year over year so doing about eight grand a month just a year ago still burning cash looking at raising a million bucks right now on seven million in terms of cap they're looking at doing a convertible note 50 grand into the company so far in terms of early angels investing after a hackathon team of 12 targeting to get you know getting churn under 30 it's tough in this space but he's focused on it got a 500 cac when he does spend money for a five or six month payback period looking to test some of those channels with new money that he raises aaron thank you so much for taking us to the top all right thanks stefan good talking to you