Orbtr Revenue (2018)

hello everybody my guest today is eric wolf he cooks 30 minute meals and 15 and he runs a five-minute mile faster than you so with over a quarter century of experience gathered over the last 20 years he's decided marketing should be more efficient too as the founder of orbiter he's known as a trailblazer in small business sales and marketing automation eric are you ready to take us to the top i'm we're going straight to the top awesome all right this is a very crowded space smb marketing automation tell me where you play what you do and what's your revenue model how do you make money uh well so first of all how we um how we make money currently is um is based on monthly subscriptions just just like everybody else um we're gonna have a big announcement in a few weeks that's actually going to completely change that or change a lot of it um which we're very excited about but i can't tease that too much right now but um we where we fit in is when you look at the big packages the all-in-one solutions um your companies like hubspot infusionsoft etc etc they make really great software um but it tends to be from a small business perspective very difficult to implement we take a completely different approach to that rather than saying that we want to be an all-in-one solution we take a integrated solution and we work with wordpress we work with gravity forms we work with woocommerce we work with zapier so rather than try to replace all the stuff that you have what we do is we integrate with the things that you already have and make that work better so just be clear like i'm seeing an example on your website is like a contact form widget inside of wordpress i mean is this a good example what you do so we we work with we work with gravity forms and so one of the things that we do for example is is where a lot of tools have dynamic content we allow you to do that right within wordpress and on any page where um we let you manage uh your segmentation and your lead scoring and things like that directly from wordpress and then we integrate with the tools that you're already using like mailchimp and woocommerce and salesforce um by way of zapier and some other integrations and so so you don't have to replace the stuff that you're already using in order to use our solutions you can we basically plug right into what you already have and we make it awesomer got it so eric give me i don't want to go down every customer cohort but on average what's a customer pay you per month for this uh 99 per month um or a thousand dollars per year simple pricing and when did you launch the company what year uh 2013 was our was our first public launch and we were in beta for about a year before that get get me in your head there and that year i mean what was going on did you just leave corporate life or where were you thinking um well actually where where i was thinking is that i um i ran and still also run a digital marketing agency and our clients very much wanted to be able to do more in the the realm of automation they didn't have a thousand dollars a month to spend on software and so we started building tools essentially for our customers we um we addressed what they were saying hey this is what we want and we want it to all work in wordpress because we're doing everything in wordpress and so really that was the genesis of the software and so from that is that agency still running today absolutely why not shut that down and go all in on the software um you know it it's a um it's a different way of helping people and so we we really um and there were there was a time that i really thought about going all in on the software but as i headed in that direction i realized that you know i i missed the ability to to work really closely with the clients and and it was also taking away one of the key ways that we learn which is by actually solving problems and so we decided to to keep you know to sort of keep going down both paths and and have the one side where we help folks and the other side where where we make our tools available for anyone who wants to use them and and very often it ends up being other agencies and so eric what have you scaled the software companies to today in terms of total customers using the platform uh we have actually at this point several hundred folks using um using the platform and um and we expect that to grow by by leaps and bounds based on the um based on the things that we're going to be rolling out in the next month so i mean eric just just trying to be just to try and be clear on that so i mean are you talking like 200 people or 500 people or 900 people uh 500 is a good number okay got it so i mean the reason the reason i'm doing this i'm trying to triangulate kind of growth so 500 sure customers paying 100 bucks a month you guys are doing about 50 grand per month right now in revenue uh we're doing less than that in revenue because of things like agency partners and folks like that that are paying different rates we have how many just before you describe before you describe the channel sorry so how much lower uh we do uh uh probably about half that at this point in in monthly revenue and then so then then tell me more those strategies so a lot of these are through kind of marketing channels where you know you're getting your margins yeah so so we have yeah so we have we have agency partners who are implementing this for their clients we have um we have folks who um we actually still have some folks who are using um a freemium version of the software that we rolled out about four years ago which which is now defunct but there are still folks that have been that have been using it and so um so we've got probably about 500 active users and just be clear though how many paying cut my question was how many active like paying customers not users how many the 500 are paying uh about 350. okay that's still healthy um and then and then what's growth look like so a year ago what were you doing per month uh so our growth has been over the last two years a little bit a little bit flat and it's one of the reasons that we're actually completely changing our model okay so it was about 25 000 about a year ago as well per month yeah okay and and so what this is a great spot to be so you identified a problem the company's flat you got to make changes what what are the tests that you're going to run to try and change that um we're actually doing we're actually about to do something and i can't tell you exactly what it is um in about a month i'll be able to but but we're about to do something that no one else in this industry by the way eric this won't go out until literally like eight months from now so by the time this is out your new thing will be live for six months so what is that news oh is that right no they didn't tell us that that's okay yeah but so what's the new thing what's the test that you're gonna run uh it's not a test actually we're we're about to become a we're actually changing the entire model and orbiter is about to become a charitable non-profit 501c3 okay and what that's going to allow us to do is um is basically make make our tools available free of charge to um to many small business owners including women-owned businesses veteran-owned businesses minority-owned businesses non-profits as well how do you pay the developers to keep developing it and keeping bugs out um well actually in in the new model we're going to be able to um we're going to be able to uh to to raise actually a lot more money um versus going the venture model where we end up uh in our view beholden to other folks so how are you going to raise money if it's a charitable non-profit the way that other charitable nonprofits raise money we're going to get grants we're going to get we're going to get donations from corporate we're going to get donations from individuals we're going to have a lot of our current users that are going to continue paying us um because they don't meet our criteria for for getting our services for free okay so it's not you're just opening up a free tier people are going to keep paying you so you still have 20 25 grand a month coming in so we're going to have we're still going to have revenue coming in we're going to have but our new model is going to be focused on on the people who we have we have a selection of criteria that are going to basically enable you to um to get a to get free license and access to all of our materials we're going to be developing education to to wrap automation around with one of the problems with marketing automation is that you give people a phishing poll and they still don't know how to use it and that's a problem that as soft as a software company it's very difficult for us to for us to solve profitably as it's even more difficult as a marketing agency to solve profitably because margins are way lower in an agency correct and so what we do so in this case what this allows us to do is put formal education programs together we're going to be able to fund those through um through donations through corporate sponsorships do you have any of those lined up eric like i'm curious what gives you the confidence do you have a grant lined up or a corporate sponsor lined up already i can't i can't disclose them but yes we have we have one grant lined up and one corporate sponsor lined up it's not official okay it will be in the next couple months but we're don't name the name because yeah we're hold the name back for confidentiality reasons but i mean are we talking like a hundred grand or like a million grand what's the what's the general size here uh we're going to be getting access to at least a hundred grand um off the bat and then we're going to be and we're going to be able to continue to raise money is is is the great thing is is we had a um we had a model that we were that we were looking at in the for-profit realm that would allow us to do something like this through sponsorships and things like that but it changes who our customers are if if you become if you if you start getting corporate sponsorships they start expecting something and our customers stop being the people that are using our tools and interacting with us and they start being folks who are um they're corporate but did you just say didn't you just say you're gonna get donations from corporate so you're still gonna be beholden to them uh not in the same way because they're not going to be a customer they're going to be making a donation yeah they're going to say if i make this donation you've got to do x y z i mean people don't just make donations to make donations they have expectations um uh correct but it's not going to be an advertising sort of play where they're going to say hey we're going to make this donation and we're going to expect you know x conversion rate on leads they're going to say we we're going to make this donation and we expect our logo to be on your website yeah it's a completely different it's a completely different game how big is the agency we're running out of time how big is the agency side of your business uh we have an agent we have a boutique agency we work with small and mid-sized businesses and and we're about six people okay and where's everybody based between the software company and the agency um except for one person we're all in the the denver front range oh i love denver my mom lives in loveland and loves it out there it's a beautiful place to be how many people are yet so six on the agency how many on the software side uh three okay so nine folks total that's great okay very good and and so the official month now everyone obviously listening to this it will have already happened but it sounds like this change is going to be happening in what october of this year 2018. uh it's going to be in either late october early november that we're going to be able to make this announcement and then it's super exciting and we're super psyched that's great very good all right eric let's wrap up with the famous five number one what's your favorite business book my favorite business book is blue ocean strategy number two is there a ceo you're following or studying right now um i'll tell you there's there's a ceo that i'm that that i'm not following um elon musk is somebody who i've always sort of held in high regard i love those guys but i feel like like he's lost something in the last few months with the um you know with with with there's a jerkiness to what he's doing right now and i don't quite understand it so i'm i'm really i'm curious to see whether whether things are about to go wrong or whether he's got a plan i'm that that's something that i'm watching yeah i don't blame him i'd be jerky too if i was the most short star short sold stock in history to the tune of trillions of dollars uh i totally get where he's coming from uh i would be a little crazy too number three what's your favorite online tool for building your business uh my favorite online tool is um actually it's slack okay um and numbers faster number four how many hours i sleep to get every night probably about six okay healthy amount and which situation married single kiddos uh i'm a single dad with two kids oh great and are they are they kind of working in the business yet are they out of the house or still young no still still still young still all in elementary school or one's in middle school one's in elementary school so we've got a little while before they're before they're they're fully integrated into into online marketing but we'll see and how how old are you eric i am 41 last almost 41. last question what do you wish your 20 year old self knew um i wish that that my that my 20 year old self could see what google was going to become guys there you have it see what google wasn't they weren't around then but but but that thing i didn't see i didn't see them i didn't see them taking over the world and now and now they're here guys there you have it eric orbiter launched in 2013 serving about 350 customers with online marketing marketing automation specifically with wordpress they're doing about 25 grand per month in revenue they're flat year-over-year so they're making a major change moving to essentially a non-profit model where they'll take corporate donations and grants to keep growing the business he's got a few of them lined up we'll see how that transition goes he's got a team of nine people in denver building again the sas company the market automation company and running his agency which services the same demographic eric thank you for taking us to the top hey thanks