How Perzonalization CEO Ilke Karabogali grew Perzonalization to $783.3K revenue and 115 customers in 2024.

hello everybody my guest today is elka kara bogali she is the co-founder of a company called personalization she's a full-fledged business person who moved from fmcg nestle to tech nokia after leaving corporate life she managed to co-build a successful international sas business from scratch with no external funding she's a sas marketing enthusiast and an avid writer now building ai-powered e-commerce personalization platform all right uh okay you ready to take us to the top okay here you go okay so the website's personalization.com uh with with z's there in the in the url tell us what the company does and how you make money okay uh we provide ai-powered e-commerce solutions to uh small and medium-sized e-commerce companies um we are working with uh like you know large uh enterprises uh along with the small ones okay and give me a general sense like on average what are companies paying per month or per year to use your tech okay so we've got two different uh two distinct uh e-commerce clients uh some of them are paying like uh 24 k uh per year and the others are like prosumers and they're paying like 250 dollars per year okay and um if we just okay so between 250 and 2 000 per month basically or do you say per year uh per year okay so hold on repeat that back to me so the smaller companies are paying 250 per year the bigger ones are paying twenty four thousand dollars per year exactly i see okay when's your launch company yeah yeah these are these are very distinct customer clients yeah take me back when was year one when'd you launch uh in 2012 we started out as a b2c company then we had a pivot in 2013. uh between 2013 and 2018 we only served uh large companies mid to large uh e-commerce clients from turkey and in september of 2018 uh we we launched our app and now we are pure sas okay and so how much how much money did you spend on the sas platform before you had a dollar of revenue do you remember um i can save like maybe uh 2000 us dollars or something like that because we are a bootstrapping company my co-founder did the uh did the coding and i did the other stuff and how many people are on the team today uh five people five people okay that's great now so you're bootstrapped that's great um so doesn't mean you're casual positive or are you burning um like it's break-even i would say okay break even fair enough and then how many customers are you working with today um in the long tail files where we have the pure sas uh it's like 111 customers all from e-commerce and on the other side in the like mid to large segment uh we have four big customers okay so four big customers paying two thousand dollars a month you're doing about eight thousand dollars a month right now on revenue uh two uh like if if we combine the ball segments it's like 11k monthly but uh you know our our large clients are paying us in turkish lira so you know when i'm talking about the uh money uh i'm doing the conversion okay so just to be clear you're doing 11 000 united states dollars per month right now across about how many total customers are paying at least a dollar um it's like a 111 customers uh plus four so it's 115 customers customers yeah so they're each paying like about a hundred dollars per month on average obviously we know that four of those customers make up a majority of the revenue though exactly so uh you know it's like 11k a month and 75 percent of these are coming from four big ago accounts yep now where was revenue where was revenue exactly a year ago do you remember uh it was like 8k uh in in in 2018 we had 39 percent uh growth over 2017 and in the last 10 months uh our revenues have grown by uh 33 something like that yeah why but like these small numbers growth should be way bigger than that right you should be like more than doubling year over year right because it's easy to go from 8 000 bucks a month to 16 000 a month why isn't growth faster uh because uh we uh i'm talking about the turkish lira because uh you know the turkish lara is also depreciating so we have a growth in terms of turkish terra but because of the depreciation the dollar equivalent uh is not increasing yeah is this what i mean yeah i do i do yeah you have to deal with currency exchange yeah yeah that's because of the currency exchange problem yeah interesting yeah yeah yeah it's it's the toughest thing about our business and that's the reason why we have decided to move outside our boundaries and had clients from 30 different countries which are paying us dollars yeah what is churn today uh it's uh you know uh it's three percent in the small segment monthly or annually monthly so 36 percent annual churn um and then do you have sorry uh we have started with this long tail segment only in september 2018 so i have metrics for the last 10 months yeah but i can take three percent per month multiplied by 12 to get 36 percent it's obviously a projection i'm extrapolating um do you know do you have expansion revenue especially on your for enterprise customers you know they pay a thousand dollars a month a year ago now they're paying two thousand dollars a month uh i'm sorry come again do you have a way to upsell your enterprise customers so they pay me more yes yes we are constantly upselling you to our customers you know um a few years ago this revenue was uh 4k uh per month for the enterprise customers and right right now it's 8k so we double doubled our sales with the help of upsells okay so it's almost something like 30 kind of expansion year over year on those on those customers that's good now what are you paying fully weighted let's talk about your long tail folks so to get someone that's going to pay you 100 per month what are you spending fully weighted marketing right to get that customer um our customer acquisition cost uh on the long tail side is seven to five bucks a month bucks per customer and on the for the big accounts we're not getting any more like you know we are only focusing on the four big accounts that we have uh we are investing all of our resources to the long tail part yep do you have any plans to raise capital uh we may i mean um 40 for the long tail part we will obviously need some capital because you know 75 uh bucks uh is might seem small to you but it's it's a big it's a big number for us well if you're adding 10 000 customers a month that's 750 grand right i mean it can add up nah yeah and we're not able to spend that much so our growth is not that much yeah no it makes sense right that's the balance every sas company has to deal with um so if you did if you did raise capital how much would you try and raise it's like 2 million dollars on what valuation would you target um i would say 6.5 million that's very specific why is it the right number i don't know i'm thinking about six to six 6.5 i mean i i was talking to some of uh some of you know finance companies and they asked me a number and that's that's that's what the number i came up with yeah okay that makes sense so you would essentially sell something like 25 30 percent of your company uh yeah something like 2 million right right now we are only two business uh founders uh so i mean it's okay for us you personally own more than 50 right i own uh 47.5 my business partner has the same and we also have five on the cap table we have a five percent for the incubation center that we previously worked with how much did the incubation center give you uh no only office space okay we are a totally bootstrapped company nathan it's like uh you know uh playing the don quixote you know by the way there's nothing wrong with bootstrapped i like someone that's creative enough to bootstrap i'm just always curious how people do it so you got free office space by giving up five percent of the company exact free office space and some networking and some mentoring that was a few years ago when we first started out but they have an upper cap so we are able to buy their share shares at a very small amount yep it's also written in our contract let's talk more uh about uh okay well it's okay so you want to potentially raise capital on this keep selling the company where do you get new customers from um we have the our apps are found on some marketplaces for um e-commerce like shopify's marketplace magento woocommerce open cart we are also getting a lot of leads with the help of our inbound marketing activities uh so we are basically uh persuading people to install our app we give them 14 days of free trial and at the end of it they give their credit cards and we start charging them what percent convert from trial to paid uh it's like 15 right now because uh some of our customers um i mean they're small customers uh and they don't even make live because they only have five or six products or they just like you know they do window shopping uh so they are not able to use our services because they are too small for a recommendation engine um so i will say 15 is converting yeah okay very good let's wrap up here with the famous five number one what's your favorite business book uh tipping point from malcolm gladwell number two is there a ceo you're following or studying um not a ceo but as ceo uh cheryl sandberg yep number three what's your favorite online tool for building your company i love canva number four how many hours of sleep to get every night uh seven to eight...