How Paytailor CEO Rode Luhaäär grew Paytailor to $36K revenue and 40 customers in 2019.

hello everyone my guest today is rhode lujar he is the ceo and founder of a company called pay taylor which is a fully cloud-based payment and data platform converting payment related problems fueled by cash or bank card infrastructure into a seamless digital experience for both merchants and their customers road are you ready to take us to the top yes let's go all right last time we came on was back on january 5th 2017 and you were just coming to market at that point you had had about a ten dollar per month arapu about 5 000 bucks a month in annual recurring revenue so you are like early early days then now we're a year and a half later so give us an update first off have you pivoted all or what's the company doing today uh we have pivoted a bit uh let's say that we have pivoted client segments so now we are offering more like a premium service for mid and big size companies so what have you driven arpu up to what are contract sizes now um they are multiple i would say i won't give you figures but if uh originally we charged like 10 euros per month then now we are i think that 10 000 euros per contract so so we are we're scaling a bit and just to be clear remind people who you're actually selling for so if you say 10 000 euros per contract first off is that per month or per year uh but yeah right now okay so let's say that i'm let's say someone's listening today they want to become a customer of yours they're going to pay 10 000 or euros per year so about 12 000 what do they get for that actually they get the premium service so they have usually some kind of problem which they want to be solved so usually it's like companies who are already have a decent client base and they want to have a solution so they can offer the solution and usually they're like self-service uh points or like somebody wants to innovate the retail stuff like that okay give me an example of how someone's actually using you actually name a brand that's using you in the use case um so um in the area we have um one fuel retailer for example who is using our solution who's the retailer it's are they a clothing brand or a food brand or what do they sell they are oil and they are they have gas stations all around uh in europe and politics specifically but it's a really good example of how you can connect uh client loyalty you can make uh self-service uh payment places well i don't i don't wanna just list the features i want actual use case so i am walking into one of these gas stations uh that are owned by this this customer that uses you what is my experience like where do i see pay tailor in that gas station uh so one most innovative solution is where you want to buy a cask or a grill for example so usually it meant that somebody has to service you now it's fully automated there has a solar panel and a full self-service system so basically you have a you you approach the self-service kiosk you have a qr nfc you you tap with a phone over there then you have a e-commerce site inside of app you can choose the products and when you are paid then service chaos opens the door okay so what you're doing is when someone checks out this gas station using the qr code right since they have their phone out you're essentially taking them to like a pay tailor generated like merchandising site where they can buy more stuff on their phone after they just made the purchase in store yes got it very cool okay and then remind everyone what year you launched uh we launched 2015 basically 2015. okay and how many customers have you scaled to today we have uh 20 major uh customers so so yeah but nevertheless like we see lots of interest of financial institutions so the regulations have changed in the meanwhile as well so if two years ago we talked about basically that in the future the users are able maybe to pay straight from the bank account uh like skipping visa and mastercard infrastructure then now we have run first test so basically we we have ran some tests to see that this is the future where it's kind of going okay how have you signed up so last time we spoke you had about 10 customers but they were paying like 10 bucks a pop you've obviously drastically changed the 20 customers you've signed up that are paying call it 10 you know 15 000 per year how did you find them what's the sales process look like so right now we uh as companies have heard about us a bit then we have we have some clients approaching us ourselves uh but nevertheless we see also that sometimes we see that we can offer great value to this company so we have approached some companies who have who has most probably this specific need okay again be specific where are you looking how do you find them how do you know how to reach out to do you email do you phone call them do you drive to them be specific we have blood we have we have taken flights also to to reach them but nevertheless like uh we have reached some financial institutions we know that uh financial institutions uh need to offer some new things to the clients then we have approached some financial institutions specifically directly what's what financial institution for example we have uh have never had negotiations with irish credit unions so it's a very like community-based thing so we have had uh conversation with them and with the scandinavian banks as well okay so if the irish credit unions end up signing up with you what does that mean when i walk into one of their physical locations what happens basically they can pay you via phone and they have uh loyalty included as well got it got it okay and and that's those are conversations you said are in the future they're you having discussions you haven't actually closed them i want to know actually how you're closing current customers before word of mouth your customers that you brought in how did you find them um we we look at sector by sector and usually the demo is enough so if we demonstrate then they are uh they will get the wow effect and they usually say that okay this this is uh the thing which we need how are you sorry this is answering my question your first you build your product you build it for x use case you want your first five customers how did you find those first five customers so if it's sector based what sector did you go after how did you find the email address the person you needed to sell to those kinds of things okay let's let's take a specific example regarding iot for example we know that uh bending uh machine company owners basically wants to have like payment solution for vending machines but there is uh lots of hassle regarding that so we look who is the biggest player in the in the specific market we take a contact we send you which was who um let's say that uh in the european scan i wouldn't name any names but we we know the company who is operating like 80 000 machines for example okay how did you know that how did you find them uh through the contacts basically yeah but how did you know what contact to find them through uh we we found some advisors who have contacts okay so you sent an email at your advisor saying you want to go after the vending machine payment space do you know anybody yes exactly it was like that and they said that we know that in europe for example this company is managing 18 000 machines for example okay and you've already closed them they're a paying customer we are we are running uh first test and uh i want an example of a customer you've actually closed how like i'm sure the reason is i'm asking this question cause there's a lot of people listening that are just starting out trying to figure out how to get their first five to ten customers you have 20. so i don't want a hypothetical or when you're currently negotiating i'm trying to dial in the strategy used to actually close first of your couple customers really simple steps the first is reach out see that uh you are telling which value do we offer yeah but who sorry what sector are you reaching out to specifically the credit unions you haven't closed yet the vending machines haven't closed yet what sector are you reaching out to specifically iot okay and what's interesting about some things internet that's some things so how do you go find it how do you go find a list of those companies uh we do online research okay what does that mean what are you typing into google we are typing in uh vending machines for example okay so do you have do you have any self-service vending machine companies paying you already yes oh okay i thought you just said that you're in discussions with the one right now that you're not actually watching usually usually it's like we tried to describe when where we have the value most uh to to make some vending machine to accept payments it's a it's not a big deal okay i think i beat this i think i beat this in the ground but but folks get the point right so he's going after kind of iot folks where there's loyalty program kind of incentives and upside for these folks and he's identified vending machines in iot space it's a good place to do that is that right road yes very good all right talk to me about churn turns critical what does your turn look like you mean uh be specific churn so last year you had 10 customers did all the 10 customers were new or did you lose some uh we lost some smaller ones as well because we have to constantly we have to be updated with payment options so it's...