How Nimble, Inc CEO Jon Ferrara grew to $8.8M revenue and 10K customers in 2024.

this is the top where I interview entrepreneurs who are number one or number two in their industry in terms of Revenue or customer base you'll learn how much revenue they're making what their marketing funnel looks like and how many customers they have I'm now at $20,000 per talk 5 and6 million he is held on global domination we just broke our 100,000 unit soul Mark and I'm your host Nathan lka this is episode 692 it is brand new for you guys this morning be sure to tune in every morning tomorrow morning I talk to Victor Leviton he breaks down how to three times your Revenue in under 8 months he did it himself going from 25k to 85k fast good morning everybody my guest this morning is John Ferrara he's been recognized for pioneering innovation in the customer management category for many many years prior to founding Nimble which we're going to talk about today he was the creator and co-founder of the award-winning customer management product gold mine in 1999 gold mine got acquired by Front Range and he left to pursue other interests during those years he continued to watch the CRM that's the customer relationship Market or management Market grow he saw that most of the CRM in the industry were saving small bus were uh that were serving small businesses moved up Market they became way more expensive and complex and they just fell by the wayside leaving the market totally underserved it was at that point in time that he decided to create the Next Generation CRM product for for small businesses called Nimble John are you ready to take us to the top I was born ready let's go awesome brother okay so we had you on last time and I just want to reference that that episode quickly if people want more background uh that was episode 643 at Nathan lea.com thetop 643 and John I'm going to quickly hit these numbers and then move into other facets of your story so John shared on that show they have about 10,000 paying customers paying on average an average RP which is monthly of $20 so truly an SMB product doing again somewhere around $200,000 in monthly recurring Revenue healthy churn for the SMB space at 3% monthly that's gross customer churn not net negative Revenue churn they spend about $5 on customer acquisition cost but they're not they weren't doing a lot of paid acquisition at the time they have a lifetime value of somewhere around $600 their team is 25 people based between uh Santa Monica and Ukraine again all small business Market founded in 2012 at that point they' raised $3 million John about accurate yep awesome okay so update us where are you now have you raised more Capital so what we've recently done is we closed round of $9 million uh and we're going to use that to scale what's working today and start investing in other areas of our business that can help us reach uh more eyeballs put more eyes in the top of the funnel you've mastered kind of acquiring the small business customer which is difficult that's not easy how are you acquiring these small businesses at such a large scale well ultimately it's exact same way that we scaled Gold Mine which essentially was Outlook and Salesforce combined in its day so back in the day there was no Outlook there was no Salesforce gold mine was the thing that everybody in the company lived in so I think the biggest problem with serum today is that it's only sales and marketing people that use it but ultimately everybody in your company should be using a relationship platform for the whole business because everybody in the company touches the customer and the way we scaled gold mine is imagine this two guys in an apartment in Koga park that's a suburb of Los Angeles who just created the world's first workable business sales and marketing relationship tool nobody even knows they need that thing how do you sell something people don't know they need and you have no money to advertise what we did is we cold called every novel reseller in the country and novel resellers essentially sold the network to that small business and we got them to use it people sell what they know and they know what they use so they started to use it they started to recommend it and resell it and each one had sold a th000 networks to all these small businesses so we instantly had $50,000 a month in recurring Revenue fast forward to today when we started Nimble five years ago nobody knew that social was going to be the new way we all do business and so when we built the first social relationship platform the first social sales and marketing system we had to go build that market and so what we did did is we went after the influence of our core customer in and around the areas of promise of our product and that's basically thought leaders and sales marketing and and social media and what we did is we started to share their content which attracted people who wanted to learn how to be better smarter faster at Social sales and marketing and we started building relationships with those influencers so we were early Pioneer of influencer marketing and that generates our eyeballs as well as generates those people into users and evangelists of nimble so that combined we got our monthly recurring re monthly recurring uh unique users uh to our website at almost 100,000 uniques per month with zero marketing spend and that's why our uh CAC is uh so low so have you've raised capital I imagine one of the questions at those meetings was hey John how are we going to spend this money to acquire new customers what was your answer well you know I believe that as you start scaling uh the way you're touching the customer you need to touch them multiple different ways so we're really good at generating those eyeballs through influencer marketing and Guerilla PR getting people to talk about the platform how do you John how do you find the influencer to to get to market for you and how do you pay them you don't pay them how do you do it so what you do is you identify the key influencer of your core constituency in and around the areas of Promise your product so thought leaders that are inspirational in around the areas of functionality of your products or services and you begin to share their content and then engage with them when they respond but you don't engage with them and say hey this is who I am and this is what our product is you find ways to add value to that person and ultimately that person becomes a friend a user and a recommender of your platform if you do it properly and so we are we really good at at generating those eyeballs through influencer marketing and gorilla PR helping writers and bloggers tell stories about how you be better smarter faster at Social sales and marketing include Nimble but now what we're going to do is we're going to begin experimenting with some spend on eyeballs through some ad spend but I'm not a big believer in in going to a rat hole of uh of of Click spend with people I believe there's other ways to get access to the customer so what we're going to do is we're going to replicate a strategy that we did a Gold Mine by partnering with people like Microsoft and Google to get their vars to use Nimble and then start recommending it so we just sign guys value added resellers so folks already selling those products that's right and so what we designed a deal with Microsoft where they became a reseller of nimble Microsoft has started to resell Nimble with Outlook through their vars and they're going to gift their vars Nimble so that their vars can be better smarter faster at sales and marketing with Nimble and Office 365 combined and I believe that the the first thing you do as a business is you get email in the old days was pop and IMAP today it's Office 365 and Google apps to work but they're not good contact managers and they're not good at sales and Market automation so Nimble on top of Office 365 and Google app so work is the operating system of a business and what we're doing is we're partnering with Google and Microsoft to scale and help their Partners uh become more Nimble and then help their customers become more so if Microsoft brings you a new I'm sure they're doing much more volume but they're bringing you one new $20 per month customer what of that Revenue goes to them sure so Microsoft uh currently is passing through all that Revenue to the vars so Microsoft's not actually getting a margin on Nimble okay so the vars are getting that margin and so ultimately what's happening is that the vars uh make the margin on the monthly current Revenue which is what what do they keep about 20% okay got it so they're going to keep they're going to keep four bucks of the 20 and you're going to keep 16 but the thing is is that the uh the average revenue per customer today is actually higher than the uh than the $20 that we talk so it's actually closer to $30 today and we see it continuing to grow higher uh but the key thing that the vars are going to benefit by recommending Nimble is that if you can help a business person solve their sales and marketing needs you then open yourself up to all the other functionality and services that you could be providing to that customer and Nimble is a trojan horse into businesses because every business struggles with sales and marketing and relationship management and if you could solve that problem what you're doing is you're talking to the decision maker of the company because typically the person making the decision on Nimble is the owner the CEO or the manager of the company so just to be clear at a $30 arpo now uh you've increased it these vars are keeping anywhere between called four and eight bucks kind of per plan is that recurring every month they keep that in perpetuity yes yes okay and we just rolled out new with this funding we're rolling out new products pricing and positioning where Nimble is more than just a uh a CRM it essentially blend social sales and marketing where instead of you having to go out and buy let's say uh MailChimp uh Salesforce yesware and um uh inside view or LinkedIn sales Navigator you have to buy all these tools in the sales and marketing technology stack in order to arm your sales and marketing team members and I think it's too costly and complex so nimble's rolling out uh Market automation add-on as well as uh 25 and $45 per se pricing which will help us to significantly increase the average revenue per account as we scale up the number of users that are using Us in the accounts and so where do you at now we just finished out March what was monthly recurring Revenue in March 2017 so it's about $225,000 okay got it so growing that's nice because that was about 200 uh just two months ago so so good growth um and how many are are you at 11,000 customers yet or still around 10,000 uh it's about 10,500 10500 okay awesome and then so 12 million total and you just did nine between our last interview and before that you did three so 9 plus 3 is 12 is that right yeah okay and then it talk to me in terms of kind of like Revenue goal in 2016 what' you do about 2 million 2.1 something like that we basically almost doubled uh this year okay so is that right so let me actually try and put a number on that so you did about two million last year you want to do four million this year is that right that's right okay all right good and um what is the in terms of I mean so one of the things I think is really smart a lesson I want to pull out for my audience I mean you do have a customer acquisition cost you've just der risked it because it's a margin on the sale so you're not hoping that a that Google ad spend click is going to drive a customer you're just incentivizing the VAR with a $6 you know you know they keep it for themselves so you do you do have cost of good so there but you get I mean that payback period for you is instant because it's just part of your it's built into your margin right but the thing is it's we're not relying on the vars to increase our Revenue it's it's going to be a long-term strategy to invest in those vars where we can help them be better at sales and marketing and social media and then they can start recommending it but we're getting we're getting immediate payback on some of the bis Dev relationships that we're doing today Microsoft has bundled Nimble inside of Outlook mobile okay and Office 365 and Outlook desktop and there's over 50 million Outlook mobile users and over 100 million Office 365 users John that's Microsoft passing that directly there's no VAR involved there so is that free acquisition for you it is come on it sounds too good to be true why do they do it because what we're doing is we're helping their Office 365 and Outlook customers be better at relationship management and making the product more sticky how do you win that though like how do you because you have hatch book propeller CRM pipe Drive close batchbook cont tactually Prosper work serus Insight yes wear on support I could go on and on how did you win that deal relationships ultimately in the end if you can identify the right people at the company and find ways to add value to their initiative so in any business relationship what you want to know is how is that person measured how is what do success look like for that person and for the AL Alpha 665 uh product people they get uh incentivized by driving uh API usage and CPU Cycles on Office 365 and so if we can make those productss more sticky then we're benefiting them and right now today when you open up office 65 or Google apps to work now called G Suite they don't have a good contact manager they don't have Outlook they don't have let alone Gold Mine the sales and Market automation that you need and so today what Nimble does is it's a free plugin into Office 365 and uh Outlook mobile and Outlook desktop that essentially requires no login no account creation and gives you instant insights on people and companies and all you got to do is add it to your Office 365 and we're rolling out that out for Google as well so that's free they're not paying 30 bucks a month for that that's right and so it's kind of like reportive on steroids right or or HubSpot sidekick or hot so how do you move them though into a paid plan okay so what happens is when you hit a button and open up an email you can Nimble that person and find out who they are and what their business about but you can only do that a limited number of times uh per day and we're going to give you open and click on your emails but you can only get a certain amount of those per month and so for the business people that actually benefit from those clicks and opens and that insights on people and companies what what we find is that they then convert into a trial account into the Nimble system and today a visitor to our website we're converting at 5% to trial but on these Outlook uh mobile and Office 365 Integrations we're converting at Double that rate at 10% to trial which is amazing great let me ask you another question because this I just named a bunch of them this is a very fragmented market and I've had all these guys on the show so I'm just going I want to throw out some benchmarks right so hatch book you know hatchbuck with Don Breen as a CEO they've raised 5 million bucks did about 2 million 2060 last year Revenue their rpos about $200 they're doing about 200 Grand a monthly recurring Revenue this is very similar John to where you're at but at a much at about 10 times the the monthly rpu the price point you've got pipe drive with Teemo they just raised a bunch of money uh they're doing about a little over a million dollars per month in Mr then you've got closed. I with Stell FY you know they've raised 1.2 million they're doing over 200 Grand in Mr then you've got like a contac which is V band up there in Washington DC is really focused on the realtor Market they've raised 13 million bucks doing about 700 Grand a month their occurring Revenue how do you have you thought ever one about doing a rollup strategy of all these guys and if not that how do you beat them well ultimately I think that in a fragmented Market what you need to be able to do is at top of mine with the your customers as well as their influencers as well as the business products that those people use and ultimately if you can become the product that their technology reseller recommends that the uh influencer and the bloggers recommend that the manufacturers like Microsoft and Google recommend that ultimately you could stay top of mind and get ahead of the pack and I think it's one of the reasons why we continue to be rated number one in most of the reviews and Publications like G2 crowd but not just in the CRM category but also in the business intelligence and and uh and sales enablement category because ultimately I think that people don't want to have to buy five different Tools in order to manage relationships and sales and marketing in their company and I think that by providing that type of functionality and and building a brand that's bigger than life that uh will continue to be in the top three and if you can be in the top three in a billion Doll Market ultimately you win yeah it's fascinating every one of these guys that I've spoken with they have mastered some kind of distribution Channel and I think the audience has heard kind of what you've mastered which is impressive then you look at a company like Cirus insights they have crushed being number one in the Salesforce app exchange like that is their thing that's how they've gotten all their growth and so I think it's an important lesson like in an area where this is why people say I executions everything you could argue that all these are a CRM now John will disagree and say we do X Y and Z different than everybody else but in general they're all crms right the way you win is by executing these amazing distribution deals like what John has articulated and so so John congratulations that's exciting last question here before we wrap up your team size last time we spoke was about 25 people what are you at now we're currently at 32 3 so okay so you're hiring what two three folks per month yeah yeah all based where are you guys based again well currently we're based in Santa Monica as well as in Ukraine but we're starting to add some additional team members uh in uh in a few other states got it and you you mentioned you just did that $99 million round um you're currently at an AR you know run rate of somewhere around you know 2.6 2.7 maybe three million bucks how do you think about valuation on that round well you know I I think that you don't go into a uh a raise with a particular value in mind ultimately what you do is you uh you let the market sort of determine that and uh and I it was essentially uh a a fair raise as far as what we were looking for at the time and and this was a series your series a or series B it was a series a series a okay so I mean industry would say you're giving up somewhere between 15 and 25% of your business in a series a were you in that range lower you were lower okay and was it more of a strategic partner like a Microsoft or more a typical VC no you know we talked to a number of different VCS and what I liked about this particular uh deal was that we're bringing in a seasoned CEO that had recently sold their company and we're taking that money and reinvesting it in new companies and so uh I really believe that they are able to add a lot of value as we scale yeah and John I just have to say I mean this is this is shocking to me in an impressive way it just it highlights your ability to negotiate but if you gave up less than 15% in a series a and you raised 9 million let's say you up 10% so that's a $90 million post money valuation on the company on a company that's doing about 3 million in ARR that's an incredible multiple well you know I think that we've proven uh before by building gold mine and now with Nimble that we can execute in this Marketplace and I think what they're betting on is the future yeah and what did you sell gold mine for $125 million okay so see I was gonna ask you the question which is what I would ask a new founder so this wouldn't apply to you but I'd say Do you ever worry about getting stuck under a liquidation preference on your series a like if you got an offer for 40 million it' make you a multi-millionaire but you couldn't sell it because your valuation was 90 you're not worried about that cuz you already had a good exit you're going for a billion dollar home run now we're we're definitely going for a a large exit with with Nimble and ultimately I think that this Market has a lot of room to run if you think about it um Google went out and built the cloud productivity Marketplace by building Google apps to work but the thing is is that Microsoft doesn't innovate they iterate and back in the day there was a company called Nel that essentially owned Network operating systems and that work group um uh Network business and Microsoft came in and ate that company and ate that Marketplace and if you think about today Microsoft Office 365 is dominating the email Cloud productivity Suite uh space and it's just beginning because they've got billions of office users they only have 100 million office 265 users they've got hundreds of thousands of ours today they've got about 50,000 Cloud csps which means there's literally billions of people that are going to be adopting the cloud using things like Office 365 and G suite and all of those people are going to need a simple social sales and marketing system to layer on top of that and Nimble I believe is is positioned today to dominate in this space all right guys I talked about this earlier but I schedule like so many meetings it would blow your mind I mean all my podcast interviews right hundreds of onars I talk to monthly I schedule and you know what I do it so efficiently I get them all to agree to my calendar so all the calls are back to back to back that means I'm not switching in between tasks all day long I get them to batch so I can be very efficient it's so critical I use a tool called Acuity scheduling to do this at Nathan la.com schedu it eliminates back and forth between me and people I'm trying to meet with it makes it very simple and most importantly they help me keep my noshow rate very low because they send out reminders helps you look very professional so go to na.com schedu to sign up and you get a great deal you know you guys know this I hit people hard I make great deals and gather and the CEO has given us a great deal if you sign up like normal people okay on their website you only get a 14-day free trial if you use my link naa.com schedule to get 45 days free okay it's the best it's free go to naa.com schedule right now to sign up and I'll see you there there you guys have it from John Ferrero let's wrap up my man with the famous 5 number one what's your favorite Business book uh thinking Grow Rich number two is there a CEO you're following or studying right now uh I I still admire Mark benof at Salesforce I think that uh he really pioneered the cloud number three is there favorite besides your own is there a favorite online tool you have uh buffer app uh number four how many hours of sleep do you get every night I get about eight okay and what's your situation married single do you have kids married three kids are young or are they all above 10 or what so I've got a daughter who's uh 13 I've got a son who's 18 just got accepted at University of Pennsylvania School of Engineering good and I got another son in Colorado uh studying business oh very cool all right and how old are you I'm 57 all right John take us back 37 years what do you wish your 20-year-old self knew started business earlier can you guys tell this guy loves what he does if you're watching this on YouTube where I'm posting all of these interviews now John's a character he's got a smile on his face he's loving it again crushing it with Nimble over $12 million raised over 10,000 customers very healthy valuation on the series a round when they raised $9 million sold less than 15% of his business churns around 3% monthly gross again that's healthy I would say for the smv space for gross churn uh again sitting on a rocket ship and he's really really perfected a single distribution Channel which I encourage you guys to do John thank you for taking us to the top thank you Nathan it's been a pleasure if you enjoyed John today go back and listen to the king of Amazon pricing yesterday he's raised $33 million and is helping over 500 of the best Amazon sellers make more money it would mean the world to me if you guys got any value from this episode if you would go leave a review on iTunes right now and then subscribe you know I hustle like heck to get these episodes out every freaking day for you guys and trust me I love it I would do it with no listeners but boy oh boy it makes my day and it makes my team's day when we see great reviews and get your feedback so thanks so much okay top drive I love giving away free money I feel like o we're giving away cars and I have something special for you today how many of you have heard our super sharp guests talk about success they've had with Facebook and Google ads well all of you listening right now yes if you're listening you get $100 in free AdWords here's how you get it okay again thanks for listening get the free $100 from Google right when you sign up with my website post provider HostGator go sign up now to get your free money hostgator.com Nathan again that's hostgator.com Nathan