Ovationup Revenue & Funding (2024)

[00:00] Please welcome Zach Oates from Ovationup. [00:05] What's up, team? Okay. So I'm gonna talk about a little bit how I built Ovation with $20,000 in marketing budget. So a little bit about me, by the way. I grew up in New Jersey, and, yeah, they do teach you how to use blow dryers there, which is how I became six four. So basically, what Ovation is is it is a feedback platform primarily for restaurants. So we have a little over 2,000 restaurants we work with [00:34] a little over 2,000 restaurants, about a 100 retailers, and one blood sucking lawyer. Other than that, we primarily work with restaurants. So I don't know. Do we oh, there we go. So we were doing 40 k in MRR. We had been around for a little while, kind of like slow, slow, slow, slow. But the problem was that we were growing fat. Right? We're growing out. And then COVID hit and just everything sucked. Then we were trying [00:59] to figure out what to do for a little while, and then we've eventually hit our stride. [01:07] But before we get into this, I'm going tell you a quick story. I have a four year old, a three year old, and a nine month old. And basically they run around all the time. Crazy. So this is our backyard and we have our kitchen table right here, and they would run around our kitchen table and run around and run around and run around and they would just smash into this glass door. Just every single day, [01:32] just smash into it. [01:35] And they actually would escape. So and this is not a fenced in backyard. There's a lot of cows back there. They come up, like, right to this fence. There's a little you know? And they would, like, stick their hand through the fence and try to pet the cows. So my wife got a little, worried, and so she put in this lock. Well, as part of putting in this lock, she drilled two little holes right there. Right? [02:00] When she drilled that second hole, the whole thing shattered. Now the reason I bring this up is because think about that. Hundreds of times my kids pressed against, slammed into it, but because there was so much surface area that they were hitting that glass, it was totally fine. But that one little drill bit and boom, the glass shattered. So we're talking about the reason I bring that up is because one thing that I learned in this [02:27] whole process of COVID is that you can do if you're doing a lot of stuff for a lot of people, you're really doing nothing for anyone. If you do something for someone, that's what gets you to break through. So if you're looking for money, forget the TAM. Screw the TAM. Let it go. Focus on what can you do for a very specific group. I'm going talk about B2B marketing and it's really focused around being accepted by [02:55] your niche. Doing a podcast, who here does a podcast? Okay, should do a podcast and I'll tell you why. And then second one is trade shows. There's a very easy, cheap way to win at trade shows. I'm going to talk about that. So be accepted by your niche. First of all, this is this is the amount of LinkedIn connections I've added of new connections per year. And in 2014, did an MBA, so I got a lot [03:24] of lot of connections there. And then I started actively marketing in 2018, looking for people in our niche. And so this is, if you're adding this many people to your LinkedIn per year in a very specific niche, you're to get to the right people. Now the thing I call it is I call it PIPCATs, partners, investors, press, customers, advisors, thought leaders. Look for the PIPCATs and connect with them. This [03:55] is how you unlock your business. But you first have to pick your niche. Then contribute with your personality. Who are you? [04:05] Like food, as you can tell. [04:09] But do case studies, post personal stuff, post thought leadership, post things about your company. So these are things that the more that you post and the more that you're connecting with your PIPCATs in your niche, the more you're going to be. Then ask yourself, what does your team lack? Rory was talking about finding people who had done it before. So find out what does your team lack? What do you need? What do you need for that [04:36] credibility? So for me, I found somebody who was [04:41] five years ahead of me. John Moody founded Restaurant365. I found somebody who was extremely respected in the industry. I found somebody who had a lot of credibility in food and beverage, then I found an investor who ended up putting money in, but they only invest in hospitality tech companies. So as soon as I took money from them, all of a sudden we were all over the news about these guys invested in us. Find [05:09] these advisors. Now one thing that I did is, have you guys heard of a FAST template? No? Yes? Maybe? So use FAST template, Founder Adviser Standard Template. This is what I used for my advisors to get them on board and how I gave them equity and how I knew how much to give them equity. And everything was already kind of decided before we had started working together. Right? Because it's already it's already kind of like predetermined. [05:37] What are you going to be in there, how much equity based on your stage. So when I talked to the advisors, send them a LinkedIn message, would love to connect, we chatted, and then I would say usually sometime on that first call, I'd say, Hey, we are looking for advisors. Would love to talk to you about that. And then I'd kind of gauge their interest. Now, we had a couple people say no, and that's okay. We [06:04] had a couple of advisors that came to us that really wanted to be a part of it. And then conversation two and three, I realized that it wasn't going be a good fit for us. And so we kind of said no. And that's okay. But when you find those good advisors, they are gold because not only does it really solidify you as a key player in that niche, but then they have all the connections, they have [06:30] all the people to go and introduce you to. So second thing, do a podcast. Now, first of all, you don't need a ton of equipment to do a podcast. Go online and get one of these mics. It's $100. If you can't invest $100 into this, then see me afterwards. I'll give you a loan, very low interest. It's not that much money. The key is just start. Do it. You don't need a lot of things. I'll tell [07:04] you what, even if you don't have this microphone, I do about 30% of my podcasts with my MacBook. I use the mic that's on them. Why? Because how many audiophiles are there out there like these people that are just obsessed with really good audio quality? Let me tell you, in your niche, probably not that many. Unless you're in a podcast niche, then get a really good mic and setup and disregard everything I'm saying. [07:30] So now you're connected to your PIPCATs. You're connected to the press, investors, partners, customers, advisors, thought leaders. So if you're connected with them, invite them on the podcast. And I have a template for you to use to invite them on the podcast. But what are you giving them? You're giving them content to make them look good. Right? Even if you are a nobody. I'm a nobody. Why did they come to my podcast? Because I created a [07:56] couple of podcasts initially with really good quality and it's fun and it takes fifteen minutes and there's no prep call, don't make them work for it. Tell them it's going to be fifteen to twenty minutes. So you have a few minutes at the beginning of like, Oh, hey, great to have you on the podcast. You've done some really cool stuff. Okay, you ready to go? Then at the end of the podcast, what do you say? Hey. [08:21] Thank you. Oh, by the way, the last question asked on the podcast is who else should we have on the podcast? Right? And then you reach out. And and who do all these PIPCATs know? Other PIPCATs. So then you reach out to the other PIPCAT to be like, hey. You were just mentioned on the podcast by this guy, so would love to have you on. And she's like, oh, cool. I'll come on. Right? [08:38] So now all of a sudden, you're getting really cool people on the podcast. And [08:45] then at the end of the call, last five minutes, you say, By the way, do you know what we do at Ovation? And they're like, Oh, I kind of checked you guys out. Yeah, we give guest feedback for restaurants. We're working with these customers. Do you know what? It would mean so much to me if I could just chat with you later on next week and would love to get your opinion on what we do. And [09:04] you know how many Domino's is now our customer because of this. This is how we're able to build these relationships. Now, this is going to come in handy. Do it cheaply. You can find people to edit these podcasts. It's very, very easy, very simple to do that. So I have this whole template that I use where I take the name, the company, title. Anyway, I have this in notes for you guys. This is a template that [09:29] we use to edit. By the way, what do I use to record? Wait. You said you ever you had a podcast, mister Blue? What's his name? He's in there. Yeah. What's your Brian, what's your podcast? Scale Up Show. Scale Up Show. Okay. Yeah. So you're like a big deal. See, I'm like I do I do, like, pizza Right? Yeah. Right? [09:50] There we go. And so what what do you use to do your recording? So I use [09:57] I I think I need to Oh, what, like, program do you use? Riverside. Okay. Okay. So, again, like, $29. I can't afford that. I pay zero. I use Zoom. So you use Zoom. Right? Like, if if you can't afford, if you're doing, like, high quality stuff, then, yeah, obviously, there's there's better programs out there. I'm almost 200 podcasts in. I've done every single podcast on Zoom besides the two I've done in person. That was very awkward. [10:23] Right? I prefer Zoom. And so then I have this whole template of how to get people how to invite people, what to send them, what to send them in the email. And this is actually really good. So what I do is I have this is my template for every single podcast that I do to, again, make it really simple. It takes me six minutes to prepare for a podcast because I have the template down. I know [10:49] what I'm going to ask them. I know how I'm going to do it. So just make it scalable for yourself because these meetings just about the podcast, it's not about the listeners. Look at this, my first 100 episodes, I had 6,700 downloads. You probably get that in the first five minutes when you release a podcast. [11:08] But the thing is, I don't care. Because I don't care how many downloads I get. I get to put this content on LinkedIn. [11:17] People that are coming on the show are putting that content on LinkedIn because they look good. And so now there's two of us, I'm saying, Oh, they think I'm legit enough to come on my podcast. And they're like, Oh, these guys are legit enough that I came on their podcast. And now their sphere's coming into my sphere, and that's how I'm growing in my niche. This is not a get rich quick thing. This is a slow [11:37] grow, it's a slow burn, but it works. And then you could reuse [11:44] this content. Social, blog, weekly email, testimonials. I've got 2,000 people with a 60% open rate email and all I do it takes me literally two minutes to write this email because I already had my podcast person create the blog post for it. So it's super super quick to send out these emails Now every week, 2,000 people times 0.6 are opening my email and looking at what I'm doing and thinking about me. Lastly, win at trade shows. [12:14] Who here goes to trade shows? Every single hand should be open because I don't care how niche your industry is, there is some weird trade show for you. I literally just spoke at the National Pizza Expo in Chicago. [12:32] It's there are there are so many little teeny trade shows. When you go to a trade show, do not spend a lot of money. Do not have swag. I know there's companies out here with a lot of swag. Let me tell you, that's a waste of money. Why? I just took two of those like Divvy rockets, and I use Divvy. But guess what? That's going to my daughter tomorrow because it's her birthday. Right? And now daddy [12:53] brought her a rocket home for her birthday. Do a really simple booth. This pop up banner, this and this all pack into one checked bag. K? The floor right here, I stole it from someone who left it at a trade show in Vegas, and I drove it back to Utah. I had my wife make a backpack for me, and I bring this as a second checked bag. I fly only Delta, means I get first bag free, [13:17] second bag $40. So I pay $40 to bring my booth. These other suckers are paying $70 to have their booth made. And guess what? I get 800 leads per trade show. They're getting 300 because it's not about the show, it's about the hustle. So I have no chairs. Nobody sits. Everyone just like lays in bed and groans at the end of the night. Cocktail tables, by the way, you can get those shipped on Amazon. $70. Ship [13:41] it to your hotel. Don't pay $300 to rent it for three days. That's crazy. Do a quick demo, have half page flyers, systematize your follow-up, trade shows work. Get a corner booth. These inline booths are terrible. No elbow room there. You see, nobody's even like so we just block the hallway and then more people come because it looks like we're doing stuff. The other thing to do is now, you've had all these PIPCATs on your [14:06] podcast. You're connected with these PIPCATs on LinkedIn. So what do you do? Get them to speak about you on stage. Who's speaking at these things? The PIPCATs. Right? So what you do is, I was friends with them now. I would literally text them, I see you're speaking too at this event. Sweet. Trying to get some people to check out Ovation. If it comes up, we'd love you to mention us. I'll send you $250 if you [14:29] do. I would pay people to mention me on stage. So literally, I'm in the audience on Venmo and just like hitting them up, hitting them up. This is worth it. Why? Because who's in the audience? The buyers. And who's talking about you? Thought leaders, people, press, customers, investors, advisors, these are the people that they listen to. And so is $250 worth a mention on stage? Absolutely. What does $250 can get you on Google? Nothing. Nothing. Gets [15:06] you customers at trade shows. And then lastly, speak. [15:11] When you do a podcast, people think that you know stuff. I don't know anything, but I bring on people who do, and then I look smart by association. [15:21] Learn to speak, make a speaker page. If you don't have a speaker page, make one. It doesn't matter, just literally go into a hotel in your area, set up a camera, and make it look like you're speaking. You don't need to actually have anybody in the audience. I'm the only one looking at you. Go and make it look like you speak. Go to speak at events, submit to it even if you don't know what it is. [15:47] The National Pizza Expo. I spoke on Tuesday, I found out I was speaking there on Friday because it was just something I had applied to, I had my marketing person applied to, and they never got back to me. But they put me main stage, speaker two of the entire show, and I didn't even know I was speaking until Friday because it just happens. So the way that it worked is 2019 I spoke at zero things. 2020 [16:09] I spoke at two virtual. 2021 I spoke at five things. This year I'm speaking at over 20. So speaking gets so much credibility from stage. Then who am I especially if you're on a panel, she just came on my podcast, she became a customer advisor, and I don't know who she is, but she was really cool. Then I he flew out. This is my customer from New York City. Flew out from New York to Chicago just [16:39] to be on this panel with me, and it was just him and me. And because of this, we closed Friendly's. And see, I have more than donuts more than pizza shirts. That's my donut shirt. So the the shirts? Oh, 3AM Instagram. It'll if you're up at three, they will show you weird shirts, and then I buy them. [16:59] Key takeaways: be accepted by your niche. Pick a niche and go into it. Find the PIPCATs, connect with them. Second, do a podcast. Bring these PIPCATs on to the podcast and actually build a relationship with them. And lastly, win at trade shows. You don't have to spend a lot of money, only the suckers do. If you do this, it doesn't cost a lot of money, you grow your business. Thank you very much.

hello everyone my guest today is zack oates he's an author husband father entrepreneur and hot tub aficionado but not in that order all the time he's voted top 100 entrepreneur rang the nasdaq bell when the world's biggest business competition started three companies received his mba from byu and did cx consulting for fortune 100 company zach you ready to take us to the top yeah man let's do it all right you're now building ovation the url is ovationup.com what's the company doing how you guys making money so we do customer experience and engagement for restaurants and retailers and we do monthly subscriptions sas we have a product that we put in and then we just charge businesses on a monthly basis to use our service and what i mean give me a general sense what are they paying per month on average to use it anywhere between 99 to 300 depending on on the package they got and what do you upsell against is the number of locations or how do you do pricing yeah everything is based on locations and then we give them uh discounted rates for more locations but primarily it's uh rack rates what's nice is that we don't do any contracts for rack rates so keep things really simple and uh keep our customers happy because we we feel like we got to earn their business every month and if we can't then we don't deserve it okay and so what does this mean relationship engagement for physical businesses like name a brand that uses you and how they how they actually use you yeah so there's a restaurant called tucanos they use us they have an ipad at the exit with smiley faces on it and then on the table they have like a text uh text to win or a qr code so all they do is they hold up their camera rank uh rate their experience if they loved it we're gonna push them leave positive online reviews and get them to come back if they didn't love it we allow them to chat with management and then our software stays in compliance with all the policies of you know facebook and and uh google review solicitations people actually do this stuff like over the past 30 days how many people actually submitted a review so we've actually had over uh this year so far we've had a couple hundred thousand people use the system and basically here's what it comes down to is right before ovation they're relying on things like receipt surveys or online reviews the problem is receipt surveys are really annoying for customers to do but they have great business insight online reviews are easy for customers to do but they hurt the business so what we do is we have a system that engages customers 16 times better than receipt surveys and gets people chatting 18 times higher than online reviews so it works so i mean how many customers are using the platform now today right now we have over 300 okay and uh we started off the year with about a hundred so it took us a year and a half to get to 100 and then in six months we've tripled so 300 head count 300 at about 100 a month you're doing about 30 grand a month right now in revenue yep and where were you a year ago uh a year ago we were at about six seven okay good and happy bootstrap the company are raised yeah so we bootstrapped it up until we got into 500 startups and uh and then after that we were able to raise just shy of a million dollars we're just wrapping up our seed round right now okay so a million dollars in the company and what's the team size today right now we've got about 14 we're just on boarding two more today and i imagine you're burning to drive growth how aggressive are you burning actually not that bad we're only doing about 14 15 oh uh a month last month yeah okay that's not bad at all i mean will you ramp that now that you closed the fund or close the round yeah yeah we're gonna get up to probably about 50 60. um but we you know having a background in in uh big consulting financial modeling is like one of uh something i'm really passionate about and making sure that because you know we have a fundamental belief that startups fail because they run out of money or they run out of excitement right and so you know we we have a pretty deep well of excitement so we just want to make sure we don't run out of money yeah and that's good now when did you launch the company what year uh november of 2016 is when we started it we did a year of beta testing and then i went full time about a year and a half ago how much total did you guys spend getting the mvp built before your first dollar revenue uh about five thousand dollars okay so not a not a ton there um yeah and tell us how you got the first couple customers i i mean just dial and smile baby that's what i mean specifically you got online what do you type it yep so we we came up with uh lists of a hub by five different verticals a hundred people from each vertical and we just cold called all those lists and we did that for about a month and we saw who had the most traction and uh where where did we get like the biggest value from it and we found the restaurant retail group was they were just loving what we were doing so like the name a restaurant retailer that was one of those first customers uh so there's a you know mainly mom and pop shops that are local to us so that's we we focus in our local community so we worked with a place called san diablo churros that he does churros and caterina we did a one one-stop brazilian location and where are you by the way location-wise we're in provo utah uh okay so san diego church was interesting okay so you then what were the other four verticals that ultimately didn't make the cut yeah we looked at dentists we look at uh or orthodontists pediatricians uh and we looked at finally and then restaurants and retailers so we focused on restaurants and then eventually we got into retail we had a few huge customers who loved us and just wanted to to jump in so even though we weren't like doing some outbound we had a lot of great inbound and today how are you getting customers especially when you look at like your fully weighted cac what are you spending to get a new 100 month customer mainly trade shows so that's where we're getting a lot of our leads from we just launched a partnership program um but you know either trade shows or we'll actually go and dial people on you know google or facebook and look for their numbers and dial them and chat with them is so fully fully weighted what's it cost to get a 100 customer uh about 250. okay so you i mean you got a two month payback three month payback that's pretty healthy yeah yeah so it's going pretty good right now um churns critical rights in any sas business what was your turn over the past 12 months so we had in total we have a 95 customer retention and uh so that's that's customers who have been with us you know yeah basically uh our monthly churn as far as mrr goes actually net negative so we have more customers upgrading the downgrading give me the gross first give me the gross yeah so we had uh you know like last last 12 months had like 20 customers uh cancel and then we had but of those we had more people upgrade than uh that made up for that revenue exactly sorry yeah what's the re what's the gross revenue churn over the maybe last month over the past year uh so last so last month for example we had like three hundred dollars in uh gross revenue returning okay yeah so sorry on a percentage basis yeah it's about one okay so about 12 annually and then what you're saying is you upsell those same accounts right in that cohort that signed up that month by more than 12 percent yep exactly what do you upsell against typically is it just new locations either new locations or we'll have people who will come in and to to do the customer experience and engagement and then they'll find that now that we we've got a few thousand of their customers in our database now they'll want to text market to them so we'll actually you know we have a texting platform so they can get customers to come back in so they'll upgrade to that and then once they're getting a lot more reviews they'll want to upgrade so that we can actually respond to reviews for them because now they're getting 10 times as many reviews as they used to get they don't have the time to respond to each one individually anymore okay make sense man let's uh let's wrap up here with the famous five number one what's your favorite business book uh favorite business book is actually how will you measure my life clayton christensen number two is there a ceo you're following or studying uh yes is um stephen covey jr he wrote the speed of trust amazing book amazing guy and also richie norton he's a incredible ceo you know someone i follow all the time in linkedin number three is there a favorite online tool you've got for building the company uh yes we love hubspot we have uh yeah that's good number four how many hours of sleep every night uh five and uh how old are you 33 33 and situation married single kids uh married with two kids okay and last question what do you wish your 20 year old self knew uh to go for it man like don't worry about conforming don't worry about conventionality just go for it why not guys ovation up helping restaurants get better reviews from their happiest customers 300 customers right now 100 a month 30 grand a month in revenue up from six grand a month just a year ago burning about 15 000 a month a million dollars raised team of 14 people net revenue churn of about our net revenue retention of about a hundred percent spending call it two months or three months of first year acv to get these customers as zach looks to scale zack thanks for taking us to the top hey thank you