Mergify Revenue (2024)

[00:00] Mergify launched back in 2018. They work side jobs until 2021, 2022 when they quit and went full time. Julien told me a year ago they're doing $35,000 a month, now doing a $110,000 a month in revenue, all bootstrapped, which we love, serving a 150 customers that pay on average $750 per month. And again, they help you merge your code faster and safer with merge queues, workflow automations, and just a lot of different ways to save time. [00:27] Hey, folks. My guest today is Julien Danjou. He's the CEO and co founder of mergify. He's been a free software developer for the last twenty years, contributing to multiple open source projects and publishing several books on the Python programming language. Alright, Julien, you ready to take us to the top? [00:44] >> Yep. [00:45] Alright. So you're working on mergify.com today. Tell us give us an example of a customer that's paying you to use the software. [00:52] >> Yeah. Sure. So what we do is we provide automation services for a software engineering team that are using GitHub. So the common problem people have in software engineering team that, I mean, you do a lot code changes, you do a lot of pull requests, but you're trying to merge as, I mean, your code as fast as possible and, I would say, as secure as possible. So, our customers usually, they're having large repositories, a lot of people, [01:21] >> engineers working on the complex code and they're trying to make that process of merging the code very fast and available. [01:28] And so, walk me through, on average, what's what do those customers pay per month to use the technology? [01:34] >> I mean, we invoice and bill per seat. So, I guess, our average team size would be around 100 engineers. So, I think for most customers, it's around between 500 and €1,000 per month on a subscription basis. [01:53] Okay. Cool. We'll go in the middle and just go with $7.50 there. So, just to be clear, you charge on that per seat model. Most teams are about a 100. Do you upsell feature sets or anything else? [02:04] >> Yeah. We do. So we have multiple plans. Right now, we have three plans. Our larger plan is already for people using GitHub Enterprise Server, which means you are deploying GitHub on your own infrastructure. So we do have a mergify instance that you can run with that GitHub infrastructure on your cloud, for example. So that's really like our IT package. Our regular plans, which are basically two, like a basic plan where you have the basic feature of [02:32] >> mergify, for example, a merge queue that's going to merge your request. Automatically, I mean, a very simple way, you want to go faster, have more optimization, we have a premium plan, for example, where we're going to add more and more features, like, more advanced features for larger teams, for example. Mhmm. [02:49] Okay. Walk me through some of the backstory here. What year did you write the first line of software for mergify or first line of code? Sorry. [02:57] >> What do mean? First time. [02:59] When did you launch the company? [03:02] >> Sorry, I [03:04] When did you launch the company? [03:06] >> Oh, sorry. We launched a little bit five years ago, basically. So the way we started is that we try to solve our own problem. Myself and my co founder, we both are software engineers, and when we started to work on a project on GitHub, we were having this kind of issue where we're trying to automate our work, basically. I mean, we are lazy, so the goal was to, know, a program that does things for you, and [03:32] >> there was a lot of missing features in that regard on GitHub, so we started that way trying to automate everything. And that's actually where we got our first customers. We both were very in open source communities. [03:46] You Name a couple of the open source communities that you were in that where you got your first customers. [03:51] >> We started with a lot of the OpenStack projects. We were working back then at Red Hat, which is a major open source project contributor. There's a lot of people working. So, for example, the Seph project, which is a distributed storage open source project that they like to use mergify in their repositories to automate a lot of their work. And that's basically how we started getting first open source project and then our first customers. [04:20] And Julien, fast forward to today, how many paying customers are you working with? [04:26] >> We have more than 150 customers right now. Most, mostly in The US, about three where we find the most companies using GetLat nowadays. Mhmm. [04:37] And Julien, so can I take a 150 customers times the $750 per month average price point? It puts you at about a 110,000 a month in revenue. Is that accurate? [04:46] >> Yeah. Yeah. [04:47] That's great. And if you're at a $110,000 a month today, where were you exactly one year ago so we can understand growth? [04:55] >> I think year ago, we were a third of that. We basically multiplied by three over the last year. [05:03] Oh, 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. [05:23] >> I'll show you how [05:23] you can access this in a second, but you log in, you connect your 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 [05:47] because depending on who's doing the buying of your SaaS company, you're gonna get 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 [06:09] sold the whole thing outright. Now what's cool about this is this is not 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 [06:34] a bunch that have been acquired the valuation and the multiple. Maybe you're going 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, [06:59] we're gonna go back to the YouTube video here in a second, but if 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, founder path dot com forward slash products forward slash valuations. Or if you go to founderpath.com and hoveroverproducts, click on get your valuation here, and go ahead and sign up to give it a whirl. Again, [07:22] all that valuation data live right inside the platform. I hope to see you there. Alright. Let's jump back into the interview. And have you done all this bootstrapped or have you raised capital? [07:32] >> We are bootstrapped since the beginning. So, it took a while, I think, for us to grow, basically because we started with, I mean, our own solution which was, you know, a Python script to automate a lot of our work and growing that to a solution that can accommodate, you know, businesses, large corporations, large teams. It took a few months, few years. Finding the good product market, it's a good Even the good marketing, the good way of [07:59] >> selling the product took us a few years, and since we did not raise capital early, which was a choice, we wanted to focus on, you know, building the product and not trying to go on a roadshow or trying to find VC or all that. [08:13] >> Yeah, I mean, it took a few years to start, but at the end of the day, we're quite happy with that decision so far because, I mean, we're free and very autonomous in the way we can take our decisions. [08:22] No, I think that's super smart. Now, you keep saying [08:24] >> we, did [08:24] you have one co founder at the beginning? [08:26] >> Yeah. [08:27] Did you guys just split equity fifty fifty at the start? [08:30] >> Yeah. Exactly. [08:31] Oh, that's odd. So how do you how do you get over disagreements? [08:37] >> It turns out we've been working together with Nelly for more than ten years. So before starting the venture, I think we both I mean, we worked, like, for five or six years together on the same cutting project, all of that. So we knew each other very well. And I think we're both alike in the way we think, so it's very rare we disagree on anything. If we do, I think we try to, you know, spend a [09:02] >> lot of time discussing, and so far we never are to, you know, to be in a very large disagreement where we're like, okay, we're blocked or we're It's a risk. I mean, for sure, I knew since the beginning that it is a risk to split fiftyfifty. So, it's very fair, and I know the company will not run without Mehdi, and he knows that it will not run without me. So, we have to work I mean, you [09:22] >> have to have this mindset where you have to work with each other, where you can't just get rid of the other one. So it worked very well so far, and it still works to this day. So [09:31] How did you you launched in 2018. It sounds like your revenue really started sort of the end of twenty twenty one. How did you guys pay yourself between 2018 and 2021, like your house rent and for food and things like that? [09:43] >> Yeah, we did not actually. I mean, we worked for the first few years. We had two jobs for a while, both Millie and I, and then we were able to switch to that full time. It took care. Mean, the first year were pretty hard. You have two. Which is a good thing, I think, to have because you know that both model and time are very constrained. So you have to focus on the right thing, which, as [10:05] >> an engineer, you see a lot of stories of people trying to build products and, you know, never launching and adding more and more features because you're like, yeah, that new feature will bring new customers and you never do anything, whereas where you were in the first few years, we were in the mindset that would be like, we have no time and no money, so, like, we have two hours of spare time this week. What do we [10:26] >> do? What can we do? It's only two hours and basically $0. So you think in a different way, which I think helped us a lot over the years to grow in a way where you don't have a lot of resources, basically. You do a lot of things. You try to grow other things with Lidol. [10:42] When did you guys quit your full, your other jobs and go all in on mergify what year? [10:47] >> We quit a couple of years ago for many, I mean, a different time for me and many to be able to focus full time on this. And also when we started to hire more people over the last years, we were able to, you [11:00] >> grow and So when did you quit your other job? [11:04] 2020? 2021? [11:05] >> Yeah. I mean, yeah, we could have a different job for Mediac. I quit last year, Mediac over a couple of years ago. I mean, as soon as we got money to start paying one salary and then two salary, we then hired more people. [11:17] How many people are you guys today full time? [11:20] >> We have 10 people full time now in the team. [11:22] And how many are doing? [11:24] >> Have seven engineers right now in the team. [11:26] Interesting. So is that Who are the other three? Are they in sales? [11:30] >> Me, I'm doing, I mean, sales and a lot of the things. And we have two people working in the team. [11:35] Walk me through how you're getting customers today. Is it still open source communities, hacker news, somewhere else? What's your go to market? [11:41] >> Yeah. So, basically, a lot of open source communities right now, I mean, we're running the service for free since the beginning for open source projects. So we do a lot of word-of-mouth again. People are seeing that on GitHub being used and they are curious about what mergify is, what it does, and they're trying it out. And sometimes they're like, you know, they work on their weekend project, an open source project, and they get back to work [12:05] >> on Monday and being like, Well, I'll test it out this weekend on my pet project, and it would be nice to have that work. So that's how often it started for the first customers. [12:15] >> We're getting, I would say, more and more mature customers, more and more bigger customers. So it's more like we need a solution to automate our own merge system, you need a merge queue, for example, things like that, so people are looking over the internet. If you know what you're looking for, like a merge queue for GitHub, I mean, we are in the first result of Google, so it's pretty easy to find us. We are one of [12:39] >> the only company providing search services. So it's easy to to to to find us and to get started by the client. [12:47] Yeah. So so there's two things here. People search organically on Google, something like merge queue, GitHub, you'll show There's GitHub, and then there's the GitHub blog, and there's merge merge queue, build kite, python.org and then mergify.com. So you get traffic there. And then you're also actually in the GitHub marketplace. How many of your new sign ups per month come through this listing here in the GitHub marketplace? [13:11] >> Very few, actually. We used to be in the front page from time to time in the first few years. And, no, I think we don't bring enough revenue for GitHub, so we basically put us never in the front page if you look from mergify or merge. You will find us on the marketplace, but that's not something that brings a lot of customers for us. [13:28] Yep. That makes sense. Talk to me about moving forward. Do you plan to stay bootstrapped or you plan to raise capital? [13:35] >> We are planning to just bootstrapped right now. I mean, we have enough cash and enough revenue to keep growing on our own pace, which is fine because I mean, we're still learning. I think it's a job of building a company with Mediavine, which is very new for us. So, it's fine growing. I mean, I would say slowly, like, hiring more people and building the team and taking time to develop it. It suits us, I think, in [13:56] >> that place so far. We do have a lot of- So, we- I mean, we'll- I think it's staying good throughout at least for this year. I mean, it's hard to say, like, a year ago I had no clue we would be 10 people right now, so it's very hard to predict anything, which is a good thing usually when it's about growing. And in terms of, like, putting new products and we have a ton of new ideas, [14:17] >> we do talk a lot to our customers, which are software engineers like us, so it's pretty easy for us to understand their pain, their problems, and then we're trying to solve them. So we're trying to come with new ideas, new products in the upcoming year to address, well, the market problem. [14:33] Yep. Are you doing any paid marketing or it's all organic? [14:37] >> It's mostly organic. We started last year to do sponsorship of newsletters, podcasts, things like that. Basically, to try to reach our audience. It's very hard to do marketing with software engineers, so we have this kind of bottom up approach where we try to sell to the engineers the solution, the tooling that we [15:00] we build. So did you spend Software Engineering Daily podcast, for example? [15:05] >> Yeah. Exactly. This kind of podcast, this kind of Did it do well? [15:10] >> It really depends of the newsletter and the and the podcast. For the part, we did a sponsorship on TLDR, the newsletter. It worked pretty well in our case. I mean, it really depends on you of some podcasts that just was a were a flaw, basically, and no get back. And in some cases, some newsletters or some podcasts were pretty great. I don't remember all the numbers from stuff my average usually Do you [15:35] remember what you paid to sponsor this t l d r t l d r dot tech one? There's a million readers on this daily email. [15:43] >> No. I don't know, honestly. It's a few thousand dollar I mean, I know our budget yeah. Our our budget usually is between a few 100 to a few thousand dollars. [15:52] Yep. Yep. Interesting. Very cool. Well, listen, this is a great story. We're certainly rooting for you guys. I guess last question before we wrap up. If someone came today, you know, you're doing what you're doing, 110,000 a month or about 1,400,000 a year right now. If someone came and offered you guys maybe GitHub and offered you 10,000,000 all cash upfront, would you sell? [16:11] >> That's a good question. I don't know. I mean, we're still growing at a rapid pace. We are happy with what we're doing, so it might be a bit soon to start the business yet. I mean, in the long term, that makes sense to start to a company that is a good fit for us or, I mean, is a good fit for the project we're trying to build. [16:28] Alright, we'll see what happens. In the meantime here, Julien, let's wrap up with the famous five. Number one, what's your favorite book? [16:35] >> That's a good question. I think I liked The Recipe the Difference, which is about negotiation. I learned a lot from reading this book. [16:42] Number two, is there a CEO you're following or studying? [16:47] >> I like Nathan Barry, which is the CEO of convert kits. [16:51] >> Yep. [16:52] Number three, what's your favorite online tool for building mergify? [16:57] >> Getup, I guess. [16:58] >> That's fair. [16:59] Number four, how many hours of sleep do you get every night? [17:03] >> Read it on my kids, but probably seven to eight. [17:06] Okay. And sorry, what's your situation? Married, single, kids? [17:10] >> I'm married, like, two kids. [17:12] Two kids. Okay. And how old are you? [17:14] >> I'm 39. [17:18] >> 39. [17:19] Last question. What's something you wish you knew when you were 20 years old? [17:23] >> I don't know. So many things. It's hard to say. [17:28] Alright, guys. There we have it. Mergify launched back in 2018. They worked side jobs until 2021, 2022 when they quit and went full time. Julien told me a year ago they were doing $35,000 a month, now doing $110,000 a month in revenue, all bootstrapped, which we love, serving 150 customers that pay on average $750 per month. And again, they help you merge your code faster and safer with merge queues, workflow automations, and just a lot of [17:55] different ways to save time. Julien, thanks for taking us to the top. [17:59] >> You're welcome. [18:01] One 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 [18:26] Central. Additionally, remember these recorded founder interviews go live. We release them here on YouTube every day at 2PM Central. 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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. [19:30] We got to push them away. Click the thumbs up below to counter them and know that I appreciate your guys'support. Alright, I'll be in the comments. See you.