Interview
How RenderStreet Reached 10,000 Total Customers on a Team of 4 (Interview with Marius Iatan)
- Interview Date
- December 12, 2018
- Interviewee
- Marius IatanCEO
Company Metrics at Interview Time
Total Customers (2018)
About 10,000
Team Size (2018)
4
Historical Snapshot
These numbers were reported by Marius Iatan during the interview recorded in December 2018 and are a historical snapshot, not current figures. See RenderStreet’s current numbers.
Key Takeaways
- 01RenderStreet had about 10,000 total customers as of 2018
- 02Three to four hundred customers actively render in any given month due to long project cycles
- 03The company is fully bootstrapped and operating at breakeven as of December 2018
- 04Team of four people, all based in an office in Bucharest, Romania
- 05Customer acquisition cost is between $50 and $150 depending on the software the customer uses
- 06Annual customer return rate is approximately 80%, implying roughly 20% annual churn
- 07Total revenue was between $30,000 and $40,000 per month at the time of the interview, with subscription revenue at $15,000 to $20,000 per month
- 08Subscription revenue was $8,000 to $9,000 per month a year prior
- 09Primary growth channels are word-of-mouth and inbound SEO content marketing
- 10Marius personally handles SEO, keywords, writing, and content for the company
Company Metrics at Time of Interview
| Metric | Value | Source |
|---|---|---|
| Total Customers (2018) | About 10,000 | Interview, Dec 2018 |
| Active Monthly Renderers (2018) | 300 to 400 | Interview, Dec 2018 |
| Total Revenue, Subscription plus Pay-As-You-Go (2018) | $30,000 to $40,000 per month | Interview, Dec 2018 |
| Subscription Revenue (2018) | $15,000 to $20,000 per month | Interview, Dec 2018 |
| Subscription Revenue (prior year) (2017) | $8,000 to $9,000 per month | Interview, Dec 2018 |
| Annual Customer Return Rate (2018) | About 80% | Interview, Dec 2018 |
| Annual Churn Rate (2018) | About 20% | Interview, Dec 2018 |
| Customer Acquisition Cost (2018) | $50 to $150 | Interview, Dec 2018 |
| Team Size (2018) | 4 | Interview, Dec 2018 |
Growth Breakdown
Revenue
Total revenue at the time of the interview was between $30,000 and $40,000 per month, subscription and pay-as-you-go combined. Subscription revenue alone was $15,000 to $20,000 per month, up from $8,000 to $9,000 per month a year earlier.
Customers
RenderStreet had about 10,000 total customers, though only three to four hundred render in any given month due to the long project cycle of 3D work. Customers must model and animate their projects before coming to RenderStreet to render, so monthly active usage is naturally lower than the total base.
Team
The company operates with a team of four people, all working from an office in Bucharest, Romania. Marius personally handles SEO, content, and inbound marketing, with someone helping on social media.
Profitability and Funding
RenderStreet is fully bootstrapped and operating at breakeven as of December 2018, living off its own revenue. Marius stated the company was not actively pursuing outside capital but would consider an opportunity if one arose.
Growth Strategy
Word-of-Mouth
Marius named word-of-mouth as RenderStreet's first channel for landing new customers, ahead of inbound marketing.
Inbound SEO and Content Marketing
Inbound marketing is RenderStreet's second channel after word-of-mouth. Marius does the SEO, the keywords, the writing and the content himself, with someone helping on social media.
Subscription Plan Migration
In 2018 RenderStreet switched a lot of its customers from the pay-as-you-go plan to the monthly subscription plan. Subscription revenue went from $8,000 to $9,000 per month a year earlier to $15,000 to $20,000 per month at the time of the interview.
Serving Multiple 3D Verticals
RenderStreet's customers come from many verticals: architects, product designers, departments of big companies, and people who do advertising, animation and movies.
Best Quotes
“Well, we have a service. We are providing a service to 3D artists and studios. Basically what we do is we take their projects and we use the power of the cloud to render them faster. This is in a very nutshell. Our revenue model is mixed. We have a subscription as a service and pay as you go as well.”
“We have about 10,000 customers at the moment.”
“Not really, no. The number I gave you is the total number of customers. In this business, the project cycle is a bit long, which means that an artist has to work to develop his project, to model it, to animate it, And after that, they come to us to render it. This is the life cycle of the 3D project. This means that not everybody comes and renders a project every month.”
“We do measure churn. Again, because of the long project cycle, it's a bit difficult to put it in terms of a regular SaaS business. But we have a return rate of approximately 80% of the customers.”
“Not actively. So we don't pursue any raising capitals at the moment. If there's an opportunity that comes our way, we won't say no.”
“No, we live off the revenue.”
“So our first channel is word-of-mouth and then we do inbound marketing quite a lot.”
What Happened Next
At the time of this interview in December 2018, RenderStreet was a bootstrapped, breakeven business with a team of four in Bucharest, Romania, serving about 10,000 total customers in the 3D rendering space, three to four hundred of whom rendered in a given month. Marius Iatan stated the company was not actively seeking outside investment but remained open to the right opportunity. Visit the RenderStreet company profile on GetLatka for current figures and any updates since this recording.
View RenderStreet’s current profile and metricsFull Transcript
Chapters
- 0:00Introduction and Background
- 0:26Product and Revenue Model
- 0:55Average Customer Spend
- 2:41Customer Count and Active Users
- 4:05Revenue Growth and Subscription Mix
- 5:08Customer Acquisition Channels
- 5:26Team Size and Operations
- 5:41Office Location
- 5:51Churn and Return Rate
- 6:20Customer Acquisition Cost
- 6:44Fundraising and Profitability
- 7:17Romania Startup Ecosystem
- 7:40Famous Five Rapid Fire
Introduction and Background
Nathan Latka
00:00Hello, everybody. My guest today is Marius Iatan. He has a technical background and started as a software developer. He co founded his first business in 2001. He's been an entrepreneur ever since. Went from startup owner to executive in a multinational company, then back to startup founder. Now he's the CEO of RenderStreet, backed by advanced tech and dedicated to reducing the stress levels of 3D artists and studios worldwide. Marius, are you ready to take us to
00:23the top?
Marius Iatan
00:24Yes, I am, Nathan.
Product and Revenue Model
Nathan Latka
00:26Okay. Explain to us how your product works and what's your revenue model? How do you make money?
Marius Iatan
00:31Well, we have a service. We are providing a service to 3D artists and studios. Basically what we do is we take their projects and we use the power of the cloud to render them faster. This is in a very nutshell. Our revenue model is mixed. We have a subscription as a service and pay as you go as well.
Average Customer Spend
Nathan Latka
00:55Okay. And what's the average company pay you per month for your tech would you say?
Marius Iatan
01:00It's difficult because we have a number of different
01:05categories of customers. We have big customers that pay us in the thousands and we have small customers that pay us between 50 and $200 per month.
Nathan Latka
01:16So I mean, so what would you say a fair average is though? Just because we don't have time to talk about every cohort.
Marius Iatan
01:20If we did the average for everybody, I would say it's about 3 or 400.
Nathan Latka
01:27Okay. And so let's say I sign up today and pay $300 a month. What am I gonna get for that?
Marius Iatan
01:34Sorry?
Nathan Latka
01:34If I sign up today for $300 a month, what will I get for that?
Marius Iatan
01:40Depending on the plan that you just sign up for, you get either unlimited rendering for less than 300 per month, or you get a number of hours to render your projects with the pay as you go plan.
Nathan Latka
01:53So is this, I mean, when people think rendering, are you talking about like movie studios or big engineering companies where they need additional computing power to render like results and you're essentially leasing them or sending them computing power?
Marius Iatan
02:07Yes, that's correct. So the verticals are quite a lot of them. They are architects, product designers, departments of big companies,
02:19people that do advertising, animation, movies, and so on.
Nathan Latka
02:23Interesting. When did you launch the company? What year?
Marius Iatan
02:26Yes, we ran 2013.
Nathan Latka
02:30'13, that's great. And have you... As you've grown the business, did you do it in a bootstrapped way or have you raised capital?
Marius Iatan
02:36We're bootstrapped to this day.
Nathan Latka
02:38That's great. I love that. Congratulations.
Marius Iatan
02:40Thank you.
Customer Count and Active Users
Nathan Latka
02:41And how many customers have you scaled to?
Marius Iatan
02:44We have about 10,000 customers at the moment.
Nathan Latka
02:47Okay. Those are all just to be clear, those aren't free customers. Those are all paying customers.
Marius Iatan
02:51Yes.
Nathan Latka
02:52Okay. So 10,000 customers paying $300 a month means you would be doing about $3,000,000 a month right now in revenue. Is that
Marius Iatan
02:58Not really, no. The number I gave you is the total number of customers. In this business, the project cycle is a bit long, which means that an artist has to work to develop his project, to model it, to animate it, And after that, they come to us to render it. This is the life cycle of the 3D project. This means that not everybody comes and renders a project every month. So the number of people rendering
03:24monthly is a lot lower than that. It's actually around
03:30between three and four hundred people.
Nathan Latka
03:33Okay. So if we do 300 times $300 a month, you're doing about $90,000 a month, something like that.
Marius Iatan
03:41Give or take, no. Actually,
03:45no, because again, no. Because the average, so what I give you the average is considering the large customers and the small ones, the large customers have even longer product cycles. So we are right now at about between 30 and 40,000 per month
Nathan Latka
03:45Okay.
Revenue Growth and Subscription Mix
Nathan Latka
04:05Dollars 30,000 per month. And where were you a year ago so we can understand growth rate?
Marius Iatan
04:12So we had a growth of about 130% this year. I mean, percent this year compared to last year. It's not a large amount, but what we did was we managed to switch a lot of our customers from the pay as you go plan to the monthly subscription plan.
Nathan Latka
04:32So just to be clear today, that $30,000 a month, that's all subscription monthly, correct?
Marius Iatan
04:38No, it's combined subscription
Nathan Latka
04:38What's and just subscription?
Marius Iatan
04:42Sorry?
Nathan Latka
04:42What's just the subscription?
Marius Iatan
04:45So the amount for just subscription is about 50... 15 to 20,000 per month.
Nathan Latka
04:52Okay. $15,000 per month. Okay. That makes sense. And then just the subscription a year ago, what was that at?
05:00Do you know?
Marius Iatan
05:01Let me think it was at about
05:068 to 9,000.
Customer Acquisition Channels
Nathan Latka
05:08Okay, that's great. So driving nice growth there. Help us understand where you found these customers. How are you landing new deals?
Marius Iatan
05:17So our first channel is word-of-mouth and then we do inbound marketing quite a lot.
Team Size and Operations
Nathan Latka
05:26Okay. And so... And what's your team size today?
Marius Iatan
05:29Four people.
Nathan Latka
05:30Four?
Marius Iatan
05:30Yes.
Nathan Latka
05:30Okay. So when you say inbound marketing, who's the one doing the SEO, the keywords, the writing, the content, etcetera?
Marius Iatan
05:37I am.
Nathan Latka
05:37Okay. You're doing you're doing all that.
Marius Iatan
05:38Someone helping with social media. Yes.
Office Location
Nathan Latka
05:41Okay. And is everyone remote or are you in one office?
Marius Iatan
05:45No. Everybody's in the office.
Nathan Latka
05:48Which office? Where are you based?
Marius Iatan
05:49In Bucharest, Romania.
Churn and Return Rate
Nathan Latka
05:51Romania. Very good. And talk to me about churn. I mean, do you measure churn today and what is it?
Marius Iatan
05:57We do measure churn. Again, because of the long project cycle, it's a bit difficult to put it in terms of a regular SaaS business. But we have a return rate of approximately 80% of the customers.
Nathan Latka
06:13Annually? So, sorry? Annually or monthly?
Marius Iatan
06:16Annually.
Nathan Latka
06:17Okay. So you have about 20% churn per year.
Marius Iatan
06:19Yes.
Customer Acquisition Cost
Nathan Latka
06:20Okay. That's not horrible. And then walk me through your fully weighted customer acquisition costs. So to get a new customer that's gonna pay you a $100 a month, what will you spend to get that customer?
Marius Iatan
06:35I think between 50 and 150. It depends again on the software they use and so on. So between 50 and $150.
Fundraising and Profitability
Nathan Latka
06:44Okay. So somewhere between kind of a year to... Sorry, a month to a two month payback period, something like that. Yeah. Interesting. Do you have any plans to raise capital or no?
Marius Iatan
06:54Not actively. So we don't pursue any raising capitals at the moment. If there's an opportunity that comes our way, we won't say no.
Nathan Latka
07:04Are you burning capital right now, Marius?
Marius Iatan
07:07No, we live off the revenue.
Nathan Latka
07:09So you're just breakeven?
Marius Iatan
07:11Yes.
Nathan Latka
07:12You operate right, kind of right at breakeven. Everything that goes to the bottom line, reinvest?
Marius Iatan
07:16Yes.
Romania Startup Ecosystem
Nathan Latka
07:17Interesting. Very cool. What's the startup ecosystem like in Romania? Are there a lot of people like you or no?
Marius Iatan
07:26They start to be, yes. So we and the community just... The things have improved quite a bit in the past five years. Before that, there wasn't quite a lot of movement, but now it's it's really growing.
Famous Five Rapid Fire
Nathan Latka
07:40I'm glad to hear that, Marius. Let's wrap up here with the famous five. Number one, what's your favorite business book?
Marius Iatan
07:49I'm into marketing right now. So I would say Fanatical Prospecting by Jeff Blunt.
Nathan Latka
07:58Fanatical Prospecting. Very good. Number two, is there a CEO you're following or studying?
Marius Iatan
08:05Yes. Jack Ma.
Nathan Latka
08:07Oh, that... Good. Numb...
Marius Iatan
08:08Of Alibaba.
Nathan Latka
08:09Number three, what's your favorite online tool for building your company?
Marius Iatan
08:14Would say Slack.
Nathan Latka
08:16And what's your situation? Married, single, kids?
Marius Iatan
08:19Married... Not married in a relationship long term. No.
Nathan Latka
08:23Okay.
08:24Not married, no kids?
08:25And how many hours of sleep do get every night, Marius?
Marius Iatan
08:30No kids.
08:32Sorry?
Nathan Latka
08:32How many hours of sleep do you get every night?
Marius Iatan
08:37Between seven and eight.
Nathan Latka
08:39Okay. And last question or second to last question. How old are you?
Marius Iatan
08:4443 yesterday.
Nathan Latka
08:46All right. Oh, congrats. Happy birthday.
Marius Iatan
08:46Us Thank you.
Nathan Latka
08:46What do you wish your 20 year old self knew?
Marius Iatan
08:53I wish he knew how to invest more in soft skills in self development and soft skills. Yeah.
Nathan Latka
09:01Invest more in soft development and self skills.
09:03He launched render.
Marius Iatan
09:04No, soft skills.
09:06Soft skills.
Nathan Latka
09:07Yes.
Marius Iatan
09:08That's what I said.
Nathan Latka
09:09Yeah.
09:10Invest more in soft skills.
09:11Is that what you said?
Marius Iatan
09:12Yes.
Nathan Latka
09:12Okay. Very good. Again, launched in 2013, has about 300 customers doing each paying call it 50, 60 bucks a month doing $15,000 a month right now in revenue. That's up from 8,000 a month just a year ago. That's pure play SaaS there. Operating at breakeven because he's bootstrapped team of four based in Romania. 20% churn each year spending anywhere between 50 to a $150 to acquire a customer. So call it a one to two month payback period as
09:38he looks to, again, lease computing power backdoor studios that do a lot of rendering, whether it's a movie studio or an architect. Marius, thank you for taking us to the top.
Marius Iatan
09:47Thank you.