How Netmera CEO Ahmet Barasan grew Netmera to $6M revenue and 150 customers in 2024.

hello everybody my guest today is khan bengal he has been working in enterprise i.t for more than two decades for the last 10 years he moved to the entrepreneurial side and brought a talented team together to build netmera to revolutionize mobile app engagement campaigning and communications they're still working hard to expand the company to other regions and reach many apps while they currently touch more than 150 million app users every single month conn are you ready to take us to the top adam are you ready to take us to the top yeah very good tell okay so tell us about the company you said in the bio 150 million app users monthly that's a big number but what's that mean for your business model how do you guys charge uh yeah we're we're in the mobile app engagement space that we analyze the user behavior inside the apps and also inside websites mobile websites and then we do send campaigns relevant campaigns to you based on your location or based on your past behavior or based on your interest and we're working with enterprise companies like vodafone or yellow pages or starbucks and they have huge applications e-commerce applications or mobile loyalty applications that have large number of users such as vodafone has maybe more than 20 million users app users and each time we get a customer a large enterprise client on board they bring us their users and we start analyzing their users so it adapts in in the end more than 100 million or now more than 150 million users now that's great and so help me understand kind of on average what is an enterprise going to pay you per year to get access to this technology you've built uh we are we are a sas company and we are charging per month or per annum okay based and for annually most enterprise customers prefer of course annual payments and they pay around 60 000 us dollars between 120 000 years per year okay and so if we just if we focus on kind of the smaller end so 60 grand per per year what are they getting for that is it a number do you price off number of app users they have or some other pricing metric yeah yeah exactly we are charging based on their number of app users interesting okay great now that we understand the business and the pricing khan put this on a timeline for us when did you launch the company what year uh well our company is called enormous research it's a research and software company and we founded the company with my co-founder in 2008 but we launched at mera this was one of our largest uh products uh we launched into 2012. yeah it's it's more than five years now and today you're solely focused on netmera well we have some other businesses not as large as nightmare but we do business with large telecom companies like vodafone or in the region solid telephone etc if you add up the parent company's total revenue what percent doesn't it mara make up more than 40 percent nearly nearly 50 percent this year okay so the other 50 is that is it sas or is it professional services or what uh we have another technology for telecom industry which is again related to messaging with sms and all style messaging sms etc and we do have ip there and we are selling software licenses there and a small amount of uh professional services like outsourcing or consulting i see okay we'll stay focused on net merit for now since it makes up call 40 to 50 percent of the total kind of pie you launched it in 2012 have you guys bootstrapped the company or did you decide to raise capital we people stopped oh that's great i love that i'm surprised that's a good that's a good thing that's very old-fashioned way but we did yeah i like it i think it's wonderful so you bootstrapped launched in 2012 and how many customers have you scaled to today uh now we have more than 150 around 150 and pressed small scale but they're in the range of 20 to 25 sma customers that's great so 150 so if i take on that 150 kind of enterprise customers times that 60 000 acv you told me earlier i mean that would put you guys somewhere around 700 and 750 grand a month right now for this this tool is that accurate uh yeah yeah uh but not every customer pays the same but we are we're about 500 000 yen okay great okay so about five hundred thousand uh and where if you're at five hundred thousand a a month today where were you about a year ago so we can calculate growth uh next year no no where were you one year ago yeah uh we are we are now we are still growing very fast moderate fast we are growing 60 70 per year okay so that would mean a year ago today you would have been somewhere in the call 350 000 a month range that right yeah exactly that's great where help us uh i believe yeah educate us educate us on the growth so as you went from 350 grand a month to 500 grand a month now today a year later are you driving most that growth by adding new customers or driving expansion revenue on your old customer base we're still growing by adding more customers and we're figuring out to penetrate into different industries network is sold by a professional uh sales team mostly we are of course helping it with uh digital uh marketing but mostly the sales is done by the our professional sales team account managers etc and we are trying to each year we are trying to reach new segments new industries for example this year 2018 was a banking year we landed more than three three four four banks large banks such as ing bank from holland for example and so what's the total team size look like today how many people uh we're around 40 people now 40 people and how many of them are focused on marketing or sales or onboarding uh for sales team we have a three four four people sales team and we have another three people for success team yeah combined yeah and where's the whole team of 40 based are you guys all uh they're overseas or where is everyone uh the majority of development is done in istanbul uh but we have offices in dubai and london and sales team is around these these locations okay istanbul dubai and london very good now obviously any kind of any kind of sas company churn is critical um what's your what's your annual revenue churn today and how do you keep it low yeah exactly it's not only important to get new customers but you need to keep them uh all the time churn is a very important method we watch closely um but fortunately we are really lucky that we have a very low churn this year we lost only three clients for example so what does that mean in terms of revenue churn though what percent uh less than two percent i guess oh wait less than two percent annually or monthly annually okay two percent revenue return annually so those were some of your smaller customers then yeah yeah smaller because we are focusing more on the large customers and it's good-sized customers and and when you look at that same cohort con so if i go back a year that cohort that signed up you lose two percent of the revenue how much do you expand that cohort by oh do you know yeah the the court annually you mean yeah every year well we lost two percent this year but we gained as i said 77 uh this year nearly but that gain is total growth i'm talking about just cohort analysis so just expansion revenue on the cohort that signed up exactly one year ago well i i don't mean it actually but i need to look at it do you i guess what i'm asking is expansion revenue if someone starts paying you six you know 60 grand in year one what do they typically expand to in year two 70 grand 80 grand 100 grand huh your your expansion revenue yeah expansion is done only ten percent fifteen percent okay so that's not bad sixty percent is it must be seventy percent so yeah yeah so fifteen percent expansion and there's two percent churn that means kind of net revenue retention would be at around 100 and kind of 12 percent right yeah yeah yeah if you do the math do you guys look at that at those data points or no not not usually london do you use those data points to guide the business or no uh yes we look at the churn uh very very uh closely uh new new net new cod names are very important again because majority of our growth is coming still coming from our com new new customers so these are two metrics we're working and also we're watching closely uh the success of our customers which we measure uh the campaign effectiveness they are ctrs general ctrs the difference between ios and android these are all metrics we would include that makes good sense and then talk to me about getting the customer in the first place so how much are you willing to spend to get a new sixty thousand dollar a year customer what's your cac oh yeah it's around ten thousand dollars oh that's not that much at all for for a sixty thousand dollar customer yeah you get paid back in what is that three four months yeah exactly it's the the business is mature now and we have a good reputation and name in our region uh in emea region i mean so that that helps and in the in the first two or three years we spend a lot of time effort and energy and also money on gaining customers but now we're getting regularly we are getting good customers like banks etc and they are calling us and i think i think we are good at the competition now and con it sounds like you're profitable correct yeah yeah it's it's profitable now is also profitable and the main company is also profitable that's great all right let's wrap up here with the famous five number one what's your favorite...