How Optifinow CEO John Mcgee grew Optifinow to $17.6M revenue and 50 customers in 2024.

hello everyone my guest today is john magees an enthusiastic entrepreneur that has started multiple businesses that are geared to solving everyday problems for businesses with innovative solutions he's a native southern californian loves the outdoors in any sport that includes a ball and a scoreboard john you ready to take us to the top i am nathan all right nice to meet you too so you're building optifinenow.com what's the company do and how do you make money well we're a cloud-based sales and management solution so we offer a platform of sales tools that uh everyday sales people have a need for from crm to sales enablement to marketing automation to uh content management content enablement and then reporting and analytics so it's a platform of all those solutions as opposed to having one solution for crm one solution for sales and marketing and one solution for enablement rolling it all into one platform so that your sales team can log into one place use one thing and just be more efficient and more effective and uh doing the day-to-day episode pricing-wise are you guys pure play sas model yeah we're a pure sass model yeah interesting okay and then give us an idea on average what's the customer going to pay you per month for the tech so the pla since it's a platform of services we offer kind of a sliding price scale based upon what modules of software you're going to use and so that's that sliding scale runs between 75 dollars per user per month on the low end up to 150 dollars per user per month on the high end and so there's eight different software modules that the client can choose from to deploy into their enterprise so we sell to the enterprise customers if we move let's move away from the per seat i'm actually curious at just the enterprise level the average team signing up with you is going to be about how many seats oh i'm sorry that's okay yeah typically in the 50 to 100 range is is kind of that market that we're that we're real strong in right now okay we're going after the mid-tier on purpose uh mid-tier there's a real strong demand in mid-tier companies that are having problems they spend you know trillions of dollars a year in terms of their sales teams and their sales organizations and yet most of them are only achieving maybe a 40 percent of quota uh so lots of research out there gartner has research out there all of the big guys have research out there that if a company can build a a best practice sales process that that takes them from a 40 quote achievement to a 90 quote achievement so john just to be clear you'd say a good sweet spot average for you is a team of 50 signing up paying 75 bucks a seat so about four grand a month per brand something like that yeah typically most of our clients are closer to a hundred hundred dollars per seat because of the of the combination of modules that they're using okay so a hundred percent that would just mean it's maybe on average fifty five grand a month instead of thirty seven hundred so 50 is on the low end in terms of users and typically our sweet spot's right in that hundred user range okay so maybe it's a hundred users at a hundred bucks a pop so around ten i'm picking up i'm picking up what you're putting down okay um all right put this on a timeline for me man when did you launch the company uh we launched the company in 2015 at 15 and 16. we're all around development of the product line 17 i was just exiting another company that started in 17 and then 18 is where we were at full scale optifine now so wait how were you building 20 between 2015 16 and 17 how are you building this company while you're still exiting another one just what we do man entrepreneurs you know we have adds so we're doing multiple things at the same time were you ceo and founder of the other one as well yes so how did you did you have investors in the old one yeah so you owned 100 right right oh okay okay so this was like a side project for you between 2015 2017 and then once you sold your other company you go win all in on this one correct so are you like super rich now or what that's the end goal right that's the end goal no in all seriousness though a lot of people listen and they go well when you sell a company look by the way i think most people build wealth in terms of being comfortable by selling too early then they use that momentum of the sale to go into the next thing it sounds like you've done that perfectly i mean can you share what you sold the last company for uh we're not allowed to share because of the of the disclosure rights on the agreement but we did well on the sale of that company and we are uh investing a lot of the proceeds from that sale into this company i see let me ask my question differently then how much of your own money have you put into this new company well in the development cost and and then uh ongoing expenses we're in the millions of dollars in terms of that we've invested in the company and so why choose to do that i mean you you could say that you're now a proven commodity why not go raise some capital risk other people's money instead of putting in your own no well definitely i mean so that's that's part of the model of have you raised company typically right oh i lost you there for a second it's okay john have so sorry maybe have you raised capital outside not yet okay we're just beginning that process for the for this company i see okay so self-funded today any co-founders or just you again uh i have a brother partner oh like an actual brother actual brother and partner not like a bro like bra like a couple of old irish guys a couple mcgees together in the statement a brother from the same mother okay very good all right um let's uh let me let me understand some more here so 2015 up to 2017 you're building you're scaling your channel you really go to market kind of 18 ish and now obviously in 19 how many customers have you scaled to today oh we're we're still small we're in the you know the 50s in terms of customer base we're in the uh tens of thousands in terms of user base why do you say 50 is 50 uh brands using you small well because this is a mass market approach so you know we're looking for thousands of customers as opposed to tens of customers but john i mean can i do the math 50 customers paying 10 grand a month i mean that's half a million bucks an mrr yeah well it's not a bad model yeah it's just you know we we see this is a huge opportunity there's a there's a significant demand in the marketplace for this especially in the mid-tier markets they have sophisticated sales and marketing needs of the same sophistication as their large enterprise competitors but they just don't have the it resources or the it it budgets to do some of the real large like a sales force type of deployment so optifine now with all of its pre-integrated modules gives them an easier solution quicker to market lower cost opportunity to get that kind of sales process embedded into their sales organization which is going to increase their voting yeah no i totally get the product i think so just because you are at about 500 a month today yeah in that range and so and you and you turned on pricing in what and what year well we actually had customers back in 15 and 16. oh okay really beta stage so we have customers that are two and three years old i see where so where were you a year ago in terms of mrr oh half of that so john i mean that's pretty good if you're basically bootstrapping doubling year over year now these are obviously small numbers but it's still healthy yeah yeah we're not we're happy with where we're at but we know there's a lot more opportunity there for us where is that expansion where's the the doubling of the company over here coming from adding brand new logos all together or expanding historical cohorts a combination thereof i mean we we've we've built a good business off of a referral network so far i mean uh so we haven't done you know we haven't gone major market in terms of sales and marketing effort on our own instances yet we wanted to make sure we had a good solid product in the marketplace we were proven with some really great customer stories so that we can then take that success and and prove that in the marketplace and so that's where we're at today and then how are you doing this in terms of your internal kind of machinery what's your team size today total and how many of them are sales people sales people have a few right now we only have uh three sales people and then in terms of overall team it's only in the 30s right now okay about 30 folks and everyone based up there in california yeah primarily based in california we're we have some remote employees but most of us are in california okay very good so 30 folks um california you you're bootstrapped today but you put in your own money uh your kind of share equity with your irish brother your real brother um talk to me about i mean how much are you burning right now would you say per month uh details of that i don't have to i've stopped my head but we're doing okay in terms of our burn rate going to go up significantly as we start to do you know big mass market sales and marketing push what i'm asking is you mentioned you're about to raise and i know entrepreneurs are always trying to figure out what should i get burned to pre-raised to make sure i hold my own leverage and don't...