How MySwimPro, Inc. CEO Fares Ksebati grew to $2.2M revenue and 7.5K customers in 2023.

hey guys my guest today is ferris speddy he started my swim pro when he was 23 and since it has grown to over a million downloads named after the year by apple and has grown to seven figures in revenue they're 100 remote company distributed across 10 different time zones ferris you're ready to take us to the top let's do it tell you what man i uh i was living in l.a the past couple months and i was living in a place with a pool and i've never been a big swimmer because i would paddle i'd go too quickly i'd kick too much and i'd paddle too i'd be out of air in like two seconds and then someone said nathan all you have to do paddle less kick less keep as much your body under water and i'm like wow i can swim a couple laps now and not be exhausted would would your app help me realize this or how does it work uh we could do that for sure you know it's funny that you mentioned that i was just at the pool before this call and i was helping like a new swimmer so we helped swimmers from beginner all the way through more advanced who maybe swam through high school or college and now they're doing it for fitness the app is basically like a personal coach so you know if you want to go to a gym and you want to get like a yoga class or a spin class that's pretty easy we created my swim pro because you can't do the same thing if you want a swim workout you know it's very difficult to get that kind of coaching so to download the app and you know to have that personalized training program tell you what to do step by step work out by workout set by set that's really what we deliver through our iphone and android app okay and this is going to sound like a silly question to the audience but i bet the answer might surprise you do you require a pool uh yes and no so you know what's really interesting especially the pandemic you know here in 2020 a lot of pools actually shut down so there's at one point here in 2020 where 90 percent of the world's pools were shut down completely so you actually couldn't swim so we actually pivoted the business and in the app we actually have at home training programs to do without a pool so you can train holistic experience so if you do have a pool great you can obviously go swimming if you have open water you can go in the lake or ocean whatever you have and if you're at home and you don't have access to a pool or you want to complement the swim training you can do that in your house as well ferris let's talk money it sounds like you've had some success here when did you launch the company what was your one yeah year one was 2015 but we didn't monetize until 2016. so tell me about what happened in 2015 sort of how did you get the initial capital to get going and how many users did you get in the first year yeah it was all sweat equity in the beginning so you know myself and my two co-founders we were basically funding it ourselves we launched the app in 2015 on ios and android and we didn't launch the subscription until the following year so we didn't take any investment actually in that first year uh first year and i think we had like 6 000 downloads and it wasn't until 2016 we did a accelerator program we got a little bit of initial investment and i think in our second year when we started monetizing we hit like 100 000 downloads total at that point and uh you know revenue wise you know we're talking we're talking like thousands of dollars yeah yeah yeah so just to be clear 2015 was 6 000 downloads how much revenue did you do that year do you remember we did zero so we didn't even have this subscript that was like we just launched free app get things going and then the next year we launched this okay so tell me about that the first year you had at least a paid option in 2016 you said you hit 100 000 downloads and what was revenue yeah uh first year was like 14 about 20 000 and how did you make the revenue what's the what's the pricing model here yeah so we initially launched with a monthly subscription it was 10 bucks a month and you know it's the app looking back now very elementary compared to what it is today uh and we've made a lot of progress uh there's still a lot more work to go but it was yeah ten bucks a month and then the following year in 2017 we added a yearly subscription option as well why did you make a decision to add a yearly option yeah so actually a couple of reasons but number one the members of our community actually wanted that you know if the people didn't want to get billed every single month for something that they knew that they wanted for a long term which is amazing uh the other thing too just looking at the unit economics when you know if you have something monthly you have to get someone to repay 12 times to equal a year right and so if you can position it where you actually get a discount for going yearly then they save money and it's perceived higher value because it is and you don't have to convince someone 12 times they have a whole year to keep their loyalty and what was that annual price you launched with it was 100 bucks so when we launched it was 10 bucks a month we actually have changed the pricing six or seven times in the last four years just tweaking things so we changed the monthly pricing to 15 a month so you could compare 15 a month or 100 a year so it's like almost like a 50 50 discount at that point what is pricing today it's a hundred and eighty for a full package for the year or thirty dollars a month interesting okay and and so let's let's just take a step back here for a second 2015 get going 2016 you get paid 2017 pricing experiments what is it in terms of total downloads in 2018 do you remember uh 2018 at that point we were probably around half a million okay and i mean this is not easy right a lot of apps on the app store it's this is not by accident it's not just word of mouth you guys are very strategic about this break it down for me how did you get five you know half a million downloads in your first two and a half three years yeah there's a few factors there um the first one is just the category that you're in so for us you know it's a fitness app but it's a fitness app specific to swimming and that subcategory actually isn't that crowded so if you think about like yoga or meditation or weightlifting i mean there's tens of thousands of apps in those categories and there's a few category winners by far in swimming i mean we were the first mover advantage so that helps that helps you get going so i think that's can attribute some of it we were app of the year by apple so we had a little bit more exposure just organically in the app store 2018 we were app of the year in 2016. so 2017 is where we started to see those results because they announced it at the end of the year in december so 2017 2018 we started to see some of that snowballing effect now that's actually not really as significant but at the time when you're app of the year and you get that prominent placement in the app store that's pretty big on the content marketing side uh really ramping things up and now we just have a machine that's pushing things out so that really helps the word of mouth and so i think snowball effect is probably the most fitting way to do it because i always tell people you know year one it was six we were getting like 20 to 30 downloads a day and then fast forward and all of a sudden that's two to three hundred downloads per day and then it's like a thousand downloads per day but it wasn't you snap your fingers and you instantly go you know if you were to spend a lot of money on marketing you could theoretically you know buy you know that exposure but we didn't really go that route it was more organic content word of mouth placement break that down real quick so 2016 was average 30 downloads a day yep and then when you get up to like a thousand or 100 a day so in twenties yeah we'll go year by year so 2015 20 to 30 downloads a day um 2016 to 2017 we we about 10x that over that you know 12 to 18 month window so now we're you know 2017 now we're looking at two 300 downloads per day 2018 2019 we've gotten up to about you know 800 to 1200 downloads per day and the unfortunate thing about the pandemic of 2020 you know with pool access being shut down for 30 to 50 we've actually been uh cut back pretty significantly you know now today in 2020 if we're looking at three to 500 downloads per day just because the pools aren't open and people aren't trying to go swimming right now but i'm very confident that 2021 when the olympics comes back around you know hopefully next year we'll start to see that traffic go back to normal and so today how many paying customers do you have either on a monthly plan or an active annual plan we have about between seven and eight thousand paying uh across both of those okay and how much how many was that last year uh we're we're about flat from last year because of the the pandemic uh but that's where we were last was revenue also flat or have you driven up sell revenue this year across the same base uh it's pretty consistent um despite actually getting less traffic incoming so you know when it comes to a cash basis we get the yearly subscribers to pay all up front that's really good for the business so we have less of that now because we have less new people coming in but we've added additional revenue streams including paid sponsorships which is sort of like an advertising component so let's kind of balance it out so we're about the same uh we would have been less probably actually because of everything that's going on and so if we break this down and go look at 2019 what was total revenue in 2019 we were 1.1 million 1-1 and what do you think you'll finish this year at the same about the same probably one yeah we'll see about that and what percent of that one do you think will come from the new stream of advertising you've added uh up to ten percent of it actually yeah we'll see i think you know last year it was zero so unless you're zero percent this year maybe up to ten between eight and ten percent uh next year i could see 20 to 30 percent of our revenue being spot that new revenue and what does that add pitch sound like to someone that sells i'm gonna make this up um to uh speedo who sells swimsuits and they want to market in your what is it you give them a placement in your app your newsletter what all of that yeah so the pitch is we've developed the largest digital community of swimmers in the world and this is a really attractive audience that we have a good connection with if you want to get in front of this audience either by sponsoring it nav challenge uh placements in our social media our email newsletter uh a 90 second spot in our youtube channel that will cost you x amount and we're going to be able to deliver half a million uh impressions or you know whatever placement that you're looking for it's pretty customized we don't have like a one size fits all so what is like how many total people do you have on your email list users that have signed up that you can reach with ads yeah so we have an email that's about half a million uh social media audience of also about half a million um and then we have the in-app placements our youtube channel alone is about 50 something thousand subscribers going growing three to five thousand subscribers per month so it's a very engaged you know people are watching these videos for like 10 minutes it's a very engaged audience there and we're sprinkling in the sponsorship placements throughout all those channels talk to me ferris about capitalization as you grew have you raised capital today and if so how much we've raised about a million dollars in the life of the business every a lot of different sources like most entrepreneurs everything from you know we did a startup accelerator we've gotten grants i've won pitch competitions we did two rounds of equity crowdfunding which is actually probably the most a lot of people asking me about that we raised online via wii funder so we have 300 uh investors across 36 different countries through those two campaigns that we did which total about six hundred thousand dollars in investment and then we have a little bit of like vc in that and outside of that as well what year did you do the wii funder campaign we did the first one in 2017 and then we did one in 2019 and how much did you do in 2017 the first campaign was a hundred and thirty thousand and then about four hundred and sixty some thousand in 2019. what's the secret to making that work uh so this is the most common question i get at least one question per week about how to raise online equity crowdfunding and i've made a few videos about this because people are so interested so the key is to figure out where is your loyal audience like who knows who you are already because that's what you have control over so if you have an email list or people know who you the entrepreneur if you're a category expert or something right that's what you have to leverage so for us it was an email list and it was my personal network and you have to be just build out the strategy your campaign like last year our campaign was open for three weeks that you could invest so i primed you know all the people that i knew that were on my existing list email list like personal list separate from our you know company uh member list and then built out the strategy and then three weeks we raised half a million dollars of the 500 000 you raised in 2019 how much of that did you get committed before you clicked launch on wii funder um that's a good question i i think it was maybe a third or maybe a little bit less yeah maybe a quarter it was committed there were a lot of so you can invest before it even opens publicly and no one can see the total and then there's people who like soft committed so i would say if you include the soft committed they didn't actually put the money in yet like on day one that was probably a third yeah this is the secret i've gotten out of all the well i've been reviewed they've done crowdfunding if you want to raise 200 grand what you do is you say we're raising 300 grand you'll go get soft commits of 200 grand so that you hit to integrate on day one and so you're definitely going to hit your target and then other people who you don't know coming into the second the last hundred grand and then the momentum and the press you get gets another 100 grand and then boom you raise net new 200 grand you have to do c you have to prime it a lot of people understand that yep yeah very interesting and you had an audience to do that which which makes a ton of sense so talk to me about team today how many people we have ten full-time and two part-time distributed across five countries how many engineers uh about half the team so half the team is on the marketing side i would say and half is on the engineering side and uh it's it's a good mix but we're still growing churns critical in a sas company it's certainly critical and obviously a subscription company like this what's your churn look like today especially considering covid oh yeah i mean if we're lucky if we're keeping at this point for yearly subscribers like 30 40 over a year so it's not it's not very good compared to what i speak with other apps so that's something we're continuously focusing on improving it's another reason why the yearly subscription is very valuable as compared to the monthly just because you know getting someone to pay 12 times compared to once uh we want them to pay you know multiple times on the yearly plan obviously and that's what we're focusing on and what's your fully weighted cac to get a new customer paying you know 30 bucks a month yeah so we actually don't spend that much on paid advertising right now that's not that's a channel that we're looking to expand on so that way we can throttle that so if we have a you know our yearly subscriber for example 180 bucks if we can you know get the cac under that you know we get an immediate payback that would be fantastic that's something we're looking to scale up we've seen just from initial testing a cac around 100 150 i'd like to get that lower i'd like to get more money behind that so we can have a better idea of what those numbers look like but it's mostly been content marketing is where we've been focusing for us on that note let's wrap up with the famous five number one favorite business book uh favorite business book i like uh tim ferriss's book the four hour work week number two is there a ceo you're following or studying oh i i can't give one so any any fitness app ceo who has you know hundreds of thousands of subscribers i try and connect with all those guys number three what's your favorite online tool for building the company i like linkedin i meant to ask you this by the way of the million you'll do this year do you have to give 30 of that to apple uh no so some of it's web some of it's ios someone's android not only is it not 30 but if you get a subscriber more than a year it becomes 15 got it how much will you pay apple this year total you think oh i should know this a bit better um at least at least six figures yeah yeah okay that makes sense all right number four how many hours of sleep to eat every night okay so now i'm getting like eight hours of sleep i was before it's all over the place sometimes it's like five or six eight is a lot for me normally it's less than that got it fair enough eight and what's your situation married single kids i'm single no can eligible eligible and no kids running around right nope all right ferris and how old are you i just turned 29 a few days ago congrats happy late birthday thank you thank you all right the last question take us back nine years what's something you wish you knew when you were 20. uh so i gave a tedx talk and i gave this quote by bill gates i'll say it here so he says and this is what i wish i realized more at the time that most people overestimate what they can do in one year but they underestimate what they can do in 10 years and it's the concept that you just got to stick with it compound the impact of whatever it is you're working on and you'd be surprised what you can do in 10 years guys my swim pro they're going to break or they broke a million dollars in revenue last year from 20 000 bucks a year back in 2016. launched in 2015 three co-founders again helping people understand how to do workouts related to anything in the water and swimming they charge 180 bucks a year or 30 bucks a month they have over 7 500 customers paying also now putting ads to their platform to folks that want to spend on ads they've done this all raising a million bucks team attend today five engineers if they look to continue to scale they're testing some paid spend caught 150 hack right now to get one of those 180 per year accounts trying to get that down so they can scale the channel ferris thanks for taking us to the top appreciate it thanks for having me 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 2 p.m 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 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