How Processmaker CEO Sunny Putra (SP) grew to $22M revenue and 350 customers in 2024.

hello everyone my guest today is Brian real he's a serial entrepreneur and his current company is called process maker com before that he found it in later sold at telecoms in the telecom space a long-distance voice and data carrier based out of South America he graduated from Duke University in 1993 and was a Fulbright Scholar in linguistics in Ecuador 1994 Brian are you ready to take it to the top I am alright tell us about process maker what's it do and what's your business model how do you make money yeah so process maker is it's all about automating processes so these tend to be the request and approval processes so basically anything that involves a form that's pulling in data and it's being routed for approval so that's a bit of a mouthful so to give you some examples we're talking about credit requests credit applications for banks and we have a lot of banking customers we're talking about purchase requests for a lot of manufacturing companies we have a lot of manufacturing companies and in higher ed it could be something like a great change request transfer request a professor ascension process a request or any kind of change management type requests okay I mean is this like plumbing that's going on behind the scenes you're connecting api's or yeah good question so it can be more plumbing but it also can be less plumbing so a lot of times it is actually the the interface itself and then it's got some plumbing behind the scenes so we're connecting API is to bring in data mostly from systems like core systems ERPs CRMs and then we're sort of routing that for humans to make approvals and generate changes in the information which gets put back in through the plumbing back into the core systems back into the ERP s or core system so when I bring up off the top of my head some some folks that I think about when I when you give me that description I think of segments or koto elastic zapier snap logic jitter bit kind of companies what do you think when you hear those companies relative to what you do so kind of jitter bits and and Xavier's or snap logic those would be a little more into a category called integration platform as-a-service so we're in kind of business process management BPM or workflow so workflow and BPM has an element an overlap with integration form so we do do integration but a lot of times we'll see customers that already have an integration platform which is good news for us because then it makes it easier to get the data we want in and out and we're gonna be much more of the kind of human powered forms that are getting routed around so those kind of companies won't do very well with the approval and and rejection part of a workflow - the key element there's like it's some human form they're filling out it's a PDF they're printing and scanning back to a email for something things like that exactly there's usually this idea of a validation and Europe book call it kind of validations we tend to look at it as approval approval reject decision moments that's kind of where workflow comes in got it that makes good sense tell me about the model is it pure sass or what's your revenue model so it's not pure sass we do both on premise and sass sass has been as you can imagine growing sort of faster in more recent years the reason there's still a lot of on premise is because this is deals with a lot of plumbing as you mentioned and it is very much mid market and enterprise so there's a lot of legacy systems a lot of legacy systems where we're being brought in because we have greater flexibility better front ends but there are enterprises which are still doing a lot of that on premise so still want it still want it on premise so we do both and in as the on-prem stuff though is it still in terms of how it hits your cash flow statements or your balance sheets I mean this it's still a predictable annual kind of event or no yeah for us it's the same it's still a an annual subscription revenue we charge upfront and and they look and act the same way from a support perspective they're a little bit different interesting okay and give me a general sense of the size of these bad boys are we talking ten granny or a hundred granny or a million a year or more so we're talking sort of 2530 gram would be kind of average contract value for us and and that doesn't include potentially professional services which might be done by us or by partners around the world so this is kind of mid market and above and it's tending it's trending upwards for us as we go kind of further into mid market and enterprise type clients got a net just to be close with an annual $30,000 contra right correct yep interesting let's get more your backstory here what you did you launched the company in so we launched process maker in 2008 the company was actually around for eight years previously when we started under a totally different premise that sort of didn't work out and kind of almost called it quits around you know around 2002 2003 but then kind of kept going with some different types of projects we were working on in about 2008 sort of discovered what we really wanted to do which was workflow and launched process maker as an open source project in 2008 we had sort of one employee then and that's really when it when it sort of took off and defined took off well we are organically kind of grown and have grown that the business very much organically since then does that mean that we're bootstrapped yeah so today we're about a hundred and forty employees worldwide so that happened between 2008 and today so not exactly sort of overnight but that's I think for bootstrapping that's it's never static Brian we've you know I know that it's never over and out ever over all right and where's headquarters there's a Durham it's Durham North Carolina yes yeah yeah very interesting okay so walk me through I want to understand you said it in 2000 like early 2008 quote didn't work out what wasn't working out and how did you have the intuition to know you got to change something so we started business in 2000 we set it up to do a reverse tradings auction site for directors and officers liability insurance okay let me sleep so I know I didn't yeah I'm just kidding so that turned out to be right at the the back end of the the.com crash and it was very difficult to raise money we sort of needed to raise money to do that so we just at that point had a few developers on staff we ended up taking on some random projects and we were basically doing websites and database systems and then eventually got a customer and sort of reflected upon what we were doing and it looked and felt like workflow so we started calling it workflow interesting so so to kind of survive there in the middle you took on some custom you know lower margin but higher contract you know you know cash in the bank quickly kind of things to sustain yourself yeah and we were my other co-founder went back to his day job I had a day job so we were basically doing whatever we could to just sort of keep the doors open for a period there and you made it through that that that down point I guess we'll call it what do yet today in terms of total customers are serving so today around 350 customers really around the world Enterprise mid-market customers and generally growing at what rate would you say so we grow our subscription business around thirty thirty five percent a year so you know we take a relatively conservative approach since it's our money and we will demand your be strapped to that's healthy growth for bootstrap company yeah you're in full control the cap table yes you and your founder co-founder yeah yeah in fact a couple years back we kind of helped we cleaned it up a bit with a couple good years we had just realizing that when you're when you're bootstrapping it really helps to have have that control as you kind of mention reliable is it why this is a really important lesson here because a lot of entrepreneurs when I dig they do some form of cap table cleaning especially if it's a company that's been around for a while with a bunch of pivots why was it quote dirty in the first place in other words how did people get on it in the first place was it friends and family and aims around hourly employees and how did you negotiate to kind of quote clean it up yeah good question so as I mentioned since we started off with a very much a different business plan we initially took on some friends and family money that was in a that was under the assumption of the previous business plan which had to do purely with insurance and reinsurance specifically they had been around for a long time so that sort of expectation of a momentous sort of exit right around the corner didn't happen for them so we wanted to provide them a way out and we had one sort of interesting event along the way provided some liquidity some cash for us so we decided hey it's a good time to to let those very early investors get out and then it gives us gave us more flexibility going forward to sort of manage the business in a slightly different way and what was the fortunate event we ended up having a small piece of small M&A transaction where we sold off an asset we we had created that's still under confidentiality but we ended up building the workflow that's deeply embedded in a in a leading enterprise system ended up kind of learning our lesson because the code slowly got forked we realized it was going to be better to try and sell that off so we did and then we took that cash and we were able to clean it up and pay a bit of a dividend interesting I want our servants the amount cuz hitter still confidential but in generally speaking how many individual entities were able to remove from the cap table as a result of that deal yeah like like 1501 yeah so there were small small shareholders who yeah you know again it was they had been on for a long time they were all happy to kind of move on and get money out so and give us a sense of kind of where you're I mean we're talking like four or five entities on the cap table between you and your co-founder plus maybe three or four others or really free and then a yeah well three and then a few five in total good so significant cleaning that's that's good stuff all right yeah now now in terms in terms of growth rate real quick so you mentioned 350 customers $30,000 a CV that means you guys are what somewhere around that beautiful ten million dollar mark at this point is that about accurate approaching it yeah yeah because you I saw you guys obviously on the Inc 5000 and in 2015 grown 130 percent year-over-year I think you did five five that year and 30% growth you every year since then we'll put you about ten five now yeah yeah a little a little bit numbers are a little bit different but what's there it's harder to keep it's harder to keep growing thirty three percent year-over-year as the numbers get bigger but but somewhere around 10 million in terms of where you guys are at totally bootstrap is obviously a great spot to be what do you focused on product wise moving forward are you focused on going and getting deeper and more wallet share from your current through Norfolk D customers or going out and getting new customers with new offerings ah that's a good question it's it's both but we have taken a much closer look at our kind of current customers in real is that there's a lot of growth there that we hadn't been sort of realizing so we're really focused on that this year we've sort of become more honest with ourselves in terms of having landed clearly in mid market and above we sort of entered the space thinking we were I think not really thinking at all so we sort of entered this space looking at the the kind of SMB or even smaller businesses realized that doesn't really work for this genre of product so we've now we're kind of looking at the the verticals were competitive in and also looking how we can how we can offer more value to existing customers tell me about churn so churn I think for us sort of that top-level churn without the the upsells it's about 12% annually I think for this kind of enterprise space that's you know pretty normal it's not kind of clear clean sass where you just get the customers on and they they tend to stay on for us the challenge is actually getting the customer on because it's a big decision customer has to be prepared to kind of put a team behind it go forward to see the value and sometimes their shifts in a management shifts in the decision maker so that's one of the challenges there and then we're you know approaching that sort of kind of zero to negative percent churn with with the upsells but we think we can drive a lot more there so gross revenues churn call it 12% your about net zero right now which means your expansion revenue from your current base grows about 12 percent year-over-year that's why you're at zero and you're we're gonna getting that negative correct that's a bootstrapped company you can't afford to pay a lot upfront if it takes you one to three years to get the money back what do you optimize payback period for we actually optimize it for that that first year and meaning you know when we sell the when we sell it we'd like to see payback pretty immediately so I would say even even less than that most of our growth has been through organic kind of organic growth so word-of-mouth and in inbound search engine optimization so we haven't made really sophisticated calculations in terms of extensive spend on the mark but we would look for it in the first year so even though we recognize lifetime values probably sort of four years four and a half five years we just I tend to ignore that calculation it can lie to you very easily sometimes yeah and it will also balance it we do we do some interesting upfront multi-year deals so we get you get a few of those in any given year and that can help balance out cash British positions pretty well so just to sum up those four unit economics real quick to make sure I've got them right you like to optimize for a 12 month or less payback it sounds like you're maybe even below that right now if your first year HP is about 30 grand it means you're acquiring these guys for less than 30 grand a pop sometimes much much lower than that that's fully way to give a team a hovering 140 I imagine some of them are sales so it's fully weighted your direct paid plus any sales and marketing staff and that puts your CAC again right around that that 30 grand mark at the worst case is that about right yeah at the very worst case so you know we're looking quite a bit under that in fact so I've had people recently say accused me of sort of leaving too much growth on the table yeah is the term that that's been thrown at me a lot lately and and I think there is a trade-off between leaving growth on the table and kind of mitigating risk and when it's when you're bootstrapping you I think you tend to kind of lean towards mitigating risk because that could quickly throw your formula out of whack typically the only kind of people throwing stuff like that at you would be investors who want you to take their money control you and then use their money to jack up your cax are you raising capital right now we're not and in fact in this case it was it was a marketer who obviously wants to spend more on marketing and and that makes sense at least we are we are starting to get more aggressive there and we but yeah you're right and it's also sort of the people they're looking to to place money if someone came and offer you especially this concerns this bootstrapping out clean your cap table if someone offered you call it 60 or 70 million bucks for the company in 6 or 7.x a are would you sell we've sort of figured out that we need to go we need to we've got a few years ahead of us just in terms of making sure so one we don't we don't think somebody would come today we need to we want to line up a little more strongly in a few areas my data so with meaning so sure churn is under control today what we think we can do a little better so I want to get it clearly into negative territory we want to make sure that in the verticals we've most recently identified we've got the kind of growth rate we we want to grow at and then on the product side we're making a couple interesting changes we want to have that story tightened down so either to make sure that we can get an optimal investor if we wanted to get an investor under optimal terms so we're thinking that we've got at least two years before we even look at anything like that interesting to drive growth faster and do it in a non diluted way would you ever consider venture debt I've been hearing a lot more about debt options and actually looked into one kind of recently and I think if we if we identify the sort of lifetime value to CAC ratio exactly and feel totally comfortable with it then we might you know consider doing something with with debt I mean today we're we're debt-free and it also means I can sleep more easily at night and not have to really worry too much so that that's after rough startup days that those memories are still kind of present and I tend to kind of want to avoid that stress all right Bryan let's wrap up with the famous five what's the last business book you read I'd saved from good to great number two is there a oh sorry name your favorite CEO would have dinner with in Durham I guess would be Marc Marc Benioff a CNO named Michael he's got to be in der name I can local entrepreneur you really respect yeah it's tough when maybe maybe Joe collip II sold Bronto Bronte yep yeah it was a good exit for that that area number three what's your preside your own with your favorite online tool favorite online tool JIRA you're a number four how many hours of sleep to get every night I'd say six and a half that's pretty good and what your situation married single you have kids married three kids three Kate are you empty nesting or no no all right yeah how how what are you 47 47 last question take us back to your 20 year old self Brian what do you wish he knew uh I wish I knew when I was twenty that yeah that it can be a I guess I wish that I had just established product market fit earlier so I would look for that more quickly you're gonna be like in your college dorm and just be thinking oh I wish I had part market fit earlier this is out or did you already of your first company at that age shortly thereafter okay all right guys there you have it from Brian he's been through the fire he's he's learned the lessons he's now again building process maker they launched it way back in 2001 through some pivots clean some stuff up in 2008-2009 timeframe now they're growing really health healthily I did about five point five million back in 2015 now up near the 10 mark serving about 350 mid-market pushing Enterprise size customers each paying about thirty thousand bucks per year an ACV at least in year one they are driving twelve percent expansion year-over-year which more than washes out to twelve percent revenue churn so they're right out about even there right now trying to get to that negative area quickly they've got one forty people with headquarters based in Durham again elf unit economic super healthy Brian thank you for taking us to the top thanks Nate