Ritekit revenue, CEO Saul Fleischman, team size, customer count, churn, and more in 2022.

hello everyone my guest today is saul fleischmann he started right tag back in the day it's hashtags from text and from images and it's building the first such tool that rides in any social media marketers workflow by browser extension and mobile app right kit now provides everything you need to grow an organic unpaid social audience and soft sell to them as you do it so are you ready to take us to the top yeah yeah thanks for having me all right so the website is right kit.com r-i-t-e what's the company doing and what's the revenue model so we started with one tool right tag it grew really big it was hashtag help mostly by browser extension mobile apps came later it got really big and people said i want this but i don't want to pay for that i want to pay for something else for social media publishing so we did something that no one on the team had experience with which was breaking one tool into four and then building those out further so right tag is what people know the the most but then there's also rightly right forged right boost and the essence of it is just automating the nuisance tasks things you would do any anyway with images and tagging influencers uh things like this auto hashtagging we invented that things like that it does for you to save you time um put this on a timeline put this on a timeline for me when did you write the first line of code for right tag i'm not a coder i'm actually the only guy on the team who is not um well you know what i mean when did the company right i'm sorry um was eight and a half years ago ago okay so you sort of officially launched in 2012. the very january 2012 yes okay very cool and and you said you said right tag got really big i mean can you quantify that for me in terms of whatever you want whatever you want to use it's somewhere between i've been checked recently but 20 25 million who have familiarity with right tag and then a tiny speck of them have completed registrations but that tiny spec is 431 000. what do you mean when you say 21 25 million have familiarity what like what does that mean they've visited the site at least once or they've seen one of our advertisements i see okay but but of those you've converted 430 000 into an actual email sign up yes that's a big list there's a lot of them opt out we don't write them all okay so help me understand how even you know getting impressions to a website and getting signups is one thing convincing the sign ups to pay you is another so what were you selling back and it sounds like it's different now but what were you selling back at right yeah so for a very long time you could define write tag as a browser extension yes there was the site you'd sign up set thing a couple things up but you're but after that you didn't come back to the site because you were doing your social in sprout or buffer hootsuite tweetdeck hubspot something from salesforce that's where you did it because you're a professional and you use the best tools and then when you needed hashtags for either an image or text you'd right click on something and you get your solution copy paste um and conversion extremely tough i put it to you this way if i was addressing 10 000 people in a room and said how many people have something some browser extension for which you could define the products value proposition is being delivered by the extension i won't ask you which ones right uh adblock would be an example though all the hands go up right i say okay now you know keep your hands up if you're paying for it so we all use browser extensions but we think of them as free and this one won't be well so that's what i'm trying to get at right is i'm actually looking at the right kit the right tag chrome extension now on the web store north of 20 000 users 60 is that not right yeah why are you shaking your head yes it is oh that is correct okay yeah right right tag on chrome extension you've got 68 reviews over 20 000 users this is the tool that you started with back in 2012. okay and so when you say you got too big and split it off what i'm what i'm actually hearing you say is you couldn't convince these sign up these people who signed up to start paying you and then you it sounds like you said we're gonna get into other lines of business more specific tools no what what we did was with right tag we would have tiers so uh with the higher tiers you would get this and that more stuff but then we what we kept hearing from people is i want the capacity of this higher tier pro or agency so there was light pro and agency but if you're paying 59 a month uh they would say well i want this and that but i don't want to pay you for social media publishing that was a big one right and this thing about like auto-generating posts that's a new habit i've never done that before um so i want to pay for what i want but not that and that's when we realized break it up and then we can offer just right tag just the hashtag help for a spec of the money so right the price for even light the lowest tier went from 108 to 120 to 144 um um uh and then it went to 144 a month no a year okay it was just hashtag help but but like for light the lowest tier went from 108 to 120 to 144 and then we added the solution for images especially powerful for instagram and surprise surprise people care about that more and we lowered the price so it went from 144 to 49 a year so and so then um things took off a bit more and gave us the ability to develop out other tools so right forge right boost right dot l y cta on links and then write tag which of these would you define as your most successful product there's a new thing it's just two months ago it's a thing we actually interacted on you noticed something on me in a forum and it was about the package and with the package we bring it back together and you get a discount deal it's about 45 off when you get all four tools and now this is doing the best for maybe five years running it was right tag that was the biggest seller and now it's switched to package um [Music] it's actually a wild time for us because now the api is our main revenue source how does that work it's monetized it's you take you you're you're familiar with apis right of course so yeah so yeah let's say you've got a medical analytics dashboard or cryptocurrencies dashboard or it's a banking app either way you have people signing up for your thing with a company domain now in their user profile they could have something there where you've got a little blue guy and you could drag in the company logo wouldn't it be nice if the logo just appears and then how is that how is that different than like the clear bit logo api because ours doesn't require attribution um okay clear bit is a competitor um for our company logo thing uh ours gets the logo gives it on a transparent background so it looks good anywhere we have more we update where you send a request and we don't have your logo we have a problem we go looking for it um the machine looks for it and then there's a transparent background and the really big thing is if you're citibank you don't want to give attribution everywhere that you use a logo to clear a bit sure so the way the way the way i found you though uh was on indie hackers um and you have a lot of products under your name and the one that caught my eye was the right kit package which you posted an update in march of 2020 and said you had a 3x customer conversion goal reached and you put the revenue up as about 2 600 per month so this right now is your now most successful sort of bundle product yeah it's looking that way it's been like two months there's no let me just say there's no other individual product that's making you more than twenty six hundred dollars per month the api is the api yeah the api okay the logo images api you have on products it says it says it's a zero in revenue so you just haven't updated that um i don't share the revenue for that and that's one so that's we have 19 solutions there's 19 endpoints it's like having 19 businesses so they said they do radically different things they serve different markets they give you an example of why someone would want company logo either from clearbit or us or other solutions that are out there like what the what that does but how about generating images so that's serving a totally different market so we we get to serve totally different types of customers learn about them find out what what else we can do for them uh and then as we get better at building these things building future ones becomes easier but isn't building the easy part isn't distribution way more difficult there's a hundred canvas out there but canva dominated distribution another billion dollar company i i really revere canva for the experience when you first try it distribution yes i would agree is really tough uh especially with us we're 100 percent self-funded 100 always and how many of you are there full-time five five and it looks like because the chrome extension says it was probably 30. we've been actually as high as 30 a lot of the time we've been in the teens or or around 20. right now it's it's um five but and how many engineers for okay so and i can from the chrome extension publishing location because google requires you do this it says the czech republic essentially so you have an outsourced team of yeah sorry yeah do you have an outsourced team of four engineers and that's where they are no no we don't outsource we've never outsourced anything why is the location on the chrome plug-in published in check then because our office is in prague our bank is in prague and we operate under the umbrella of maine top businesses sro a czech corporation okay is there a strategy there or what's the thinking there shouldn't work no what it is is these things start as projects you know you and i intermingle with the indie hackers people something starts as a project you don't know it's going to become a product and from that a company will you know be built so it started this way and we needed accounting were you living in prague no but our our cto mikhail who to check okay that's what i was trying to get to yeah so you're situ and where are you where are you living now i'm in osaka japan oh i see okay got it so distributed team your cto is based was based in prague he's still there still there yeah so we have an office we have an office that we can't we legally can't go to because it's czech republic and corona um so uh but yeah but these guys they're not we've never outsourced it's something i don't believe in um absolutely so so i mean how do you think about your month you have 19 projects i can barely focus on getting one thing right it's not projects so the 19 their endpoints they're working so if you if you first of all we have a demo dashboard you play with this yourself you don't need to be a um an engineer it just it's just try it see what it does i don't you know what open it in incognito mode it'll work for you anyway you don't have to read the documentation study anything be a coder you try it so you're the um the business or marketing guy at a company you find this you see what it would do for your thing you put your engineers onto it they're the ones that get the developer token and read the documentation but if you start out with say tier two of our api this is 330 a month yeah but you do it a smart way though you build based off sort of credits which are tied to i believe the number of image searches a company might do per month is that accurate no no it's a matter of we need to price different end points differently what does that mean though what does endpoint mean a solution so we're trying to find that to someone listening right now that doesn't know your product oh sure so it's um taking text making an image from it that's like one action so this is with image generation okay so then give me another example uh company logo so company logo it's whenever there's a domain and you have you'll do complex things with filtering so if that domain is gmail you're not going to try to get a logo for that or hotmail or something but after that then you're going to get um logo that's an action that action costs two credits i see i see okay so the right question i should be asking is across your 19 end points how many actions are you performing every month is it i mean because it could be in the millions correct yeah it's um i don't have right in front of me it's probably um in the tens of millions yeah and that that is in how you grow the business because pricing is directly correlated to number of actions per month yeah yeah so just for perspective our most well-known product is right tag um [Music] and if you're paying for that it's only yearly but if you look at it you know you know emma we can talk mrr of course right and uh monthly recurring revenue for anyone who didn't um know that uh right if you look at it on that on a monthly basis it's four dollars and eight cents you're paying for our api the lowest tier you can pay for is 49 a month so 12 times on the other hand customer service is almost nothing with the api so i mean if you're processing 10 so you think it's 10 million actions per month or tens of like tens of millions like 40 but less than but less than 100 million yeah okay got it yeah so somewhere between 10 million and 100 million actions per month across your 19 different endpoints which are essentially all your different products um that you've built they're not different so there's a lot of things that we use we don't use all of them but there are things that we use but they're not um identical to our products they're not they're not presentations you have built 19 tools to help your business run when people choose to use you on an on a credit basis you on the back end are using some form combination of those 19 internal tools you've built some of those tools show themselves in your product some of them don't correct yeah got it so some uh some of them were planning to use when time permits yeah yeah well i mean the reason i'm doing this math is because your most expensive plan is tier three 1.5 million credits right or we defined as actions earlier per month all endpoints are included and that costs 600 per month right for 1.5 million actions is that right yes and i can tell you right now we don't have a single customer on that yeah but what i could do then is is take 1.5 million divided into a minimum of 10 million actions you just said you're doing per month you're doing north of 6 000 per month right now on revenue i don't i don't reveal um what we're doing in revenue i'm multiplying off your pricing page which is public yeah you can make assumptions but then no no it's not an assumption it's not an assumption i'm reading 1.5 million tier 3 600 per month and you just said north of 10 million actions per month but here's the thing so people pay for access to calls with their credits they don't pay for their consumption so for so you'll notice in in uh pricing for the api it says 100 credits free on the free tier there's a free tier yeah okay so let's say you've got something small and you're going to need 70 80 credits a month this is really really small ridiculously small but you know what you pay for um tier zero which gives you i think it's 50 000 credits um and why would you do such a thing you would do such a thing even though you don't even think you're going to use a hundred because you don't ever want to be stymied you don't ever want to send a request and not get what you want so people companies pay for a tier of the api for access to calls doesn't mean they're consuming them all yeah so what you're arguing is people are potentially paying for more than what they're actually actually getting for fear of they don't want to run into a limit yeah yeah some of them they might be using 38 000 of their fifty thousand calls for that tier but um others are playing it safe they don't want to get called in the middle of the night um they don't want to get called when hey something's broken in the site what's broken is they were stingy and instead of paying 150 they paid 49 um and they just went a little bit over that limit um for a few days i see so what you're arguing is hey nathan yeah i understand the math you're doing but we could be doing way more than six thousand dollars per month because people will pay for more than the number of actions we're actually completing always i see i see interesting okay very cool so you've done any plans to raise capital you want to stay bootstrapped and no interest in raising no i love that did you have a horror story there or something you said that very quickly no no it's something that our cto mikhail and i have studied he has worked with funded startups i call them externally funded startups and we both have read venture deals both sides of the table and such so we understand about it but we also understand about control it's about more than just money it's about control and it's about getting in bed with people who have control over uh first look at opportunities to flip your baby um and these are people that might be invested in well it's not usually people it's a fun that's invested in several hundred projects but for you it's what you do seven days a week my case i work no complaints but i work seven days a week um and this is all i do i'm not also a crypto enthusiast um [Music] or own a hoverboard um you know this is what i did did you and your cto at the beginning decide to just cut it right down the middle 50 50. no no oh god no um we made plenty of of similar mistakes where we were like because remember i spoke the thing that i said about these things start as projects nathan they don't we don't know that it's going to become the kind of a company that's going to last for decades 100 years or something you don't know that in the beginning so we did like splitting equity something i wouldn't do now something i would handle that totally different fortunately it worked out so far so do you own the majority of the company or not uh it is owned by three of us i don't discuss how much is owned by each person but the original three that started um [Music] right tag are are the owners but there have been a couple times when there was someone we wanted to take take on that wanted equity in their package and then we looked at hey us three guys [Music] are going to have to throw something into what we should have started with it's called equity pool but we didn't know these things um so why didn't you do it i'm i'm old i'm supposed to be knowledgeable so what happened though is the third person that had equity at the beginning is he or she no longer with the business no no so the three that started we still have it but i'm just saying there were two people that um we went down the the path of discussing with them we wanted to to hire them um they were really mission critical type people did you we didn't in either they had other offers they um one is teaching data science at colorado school of mines right now um another is at google okay but sorry so what does that have to do with the conversation about equity so i'm saying that we went down the path of oh no we've allocated 100 percent of equity what happens if we wanted to take on funding or what happens if we wanted to hire someone and simple you three agree to set up a 10 option pool and you each get 10 dilutions yeah we would we would basically throw back some of our equity but you were saying this like it was an issue but it but it's not it shouldn't be an issue no it hasn't like we just agreed to do that and then it wound up not necessar not being something that we needed to do i see i see okay well look we're out of time before we wrap up with the famous five i mean what do you think takes you from where you are today to hitting you know like a million dollar two million dollar run rate how are you gonna drive growth uh probably a lot more that has to be added to the package uh and then a couple api solutions that get modified they could be stronger than they are now okay and so you're less than two million in an ar today i don't discuss that okay well i just asked what what do you have to do to get to that and your answer was we gotta add a lot more to the packages and do more it's early in the morning i miss the the sleight of hand with the words but i don't i don't share what um i don't say we're below or above that because that would be a mistake to share okay why would you say it's a mistake it's a mistake because whatever number you put out there is at the same time too low and too high i assume you've read um crossing the chasm yeah jeffrey moore has been on the show many times i know okay so here's the thing it's when someone at a big company is influencing someone in a big company and can stop a sale or something and they see wow these guys are only bringing in let's say 200 000 a month they must be teetering on the brink of of circling the drain why would you assume why would you assume that well because they're at a big company and all they know is big companies and they think wait a minute their revenue not profit but their gross revenue is a measly whatever whatever the number is is what i'm saying so i think you're inside can i just be on i think you're inside your own head here i think this is you totally i think this is you totally projecting you for whatever reason feel like your revenue is embarrassing and i would argue it's probably not you've convinced yourself it is but it's not because there's many people of big companies that look at companies that are only doing 10 000 a month in revenue but guess what the month before they're doing a thousand a month in revenue and so the growth is incredible and the team's talented so they buy the company well we've actually no we've had experiences actually speaking with people where they're considering buying um we don't have seats in our products so they're going to pay for many subscriptions yeah so they need 40 subscriptions and so they might be looking at 20 000 and what they want to know there are other things that come up for example oh wait a minute you're not a us-based corporation see they don't they're never going to sue us they don't plan to sue us they're not interested in that they want to know that they could easily and it's so sorry again i just i just think you're maybe this is already public you can see on the chrome page that you're not a us company and you can see on indie hackers you publish 2600 a month in revenue for that one thing and for very short term it was very brief period okay but like you either you're either at your core believe you should share revenue or you don't or you believe you should disclose your us or not you've already broken two of your own rules because that's how i found you but like i say it's only for very a brief period that i shared that and on something that's really complex the package so remember how i said that a number whatever the let's say it's 10 000 mrr that number is both too high and too low at the same time so for some companies they're going to say i can't trust these people tiny team and that's all they're doing in money they might go out of business i would hate to be the guy who made the decision to pay for this and then they go out of business okay it's like a black mark against me but that same let's say it's ten thousand let's say what's something that you could consider a in some cases a small number to somebody in bangladesh she's working six days a week and for less than a thousand dollars a month considerably less you'd be surprised less than six a thousand dollars a month with her degree full time and she's thinking i can't like match everything these guys do but i'm shrewd enough to figure out what's the gem at the center of right whatever you know of somebody's product and i'm just gonna do that and i'm gonna offer it for half the price and if it doesn't work out blow it out on appsumo you know and from their perspective this is a thing to do and i would not encourage competitors and i also would not um dissuade those who they would like what they get when they pay for it and we're not about to go out of business they're not going to look at that we're eight and a half years in continuous development they're also not going to look at the difference between self-funded and externally funded and how we don't have a monkey on our back we have an infinite runway you know um but i think i've taken too much of your time i wouldn't be sensitive no i mean i i just i think what i would say is yours it's a mixed message you already put a price like you put 26 it is up right now anyone can go view it so like if you believed what you were saying you wouldn't have that up anywhere uh so that's all i'm trying to back into um i think regardless though the model you've built is interesting in terms of usage based um you it sounds like you've got some arbitrage on your human capital which is great you can build a lot of stuff a lot of value very quickly um and it sounds like again you you've done you're in this for the long haul you're self-funded so you don't have to answer to anybody else which is great uh let's wrap up your saw with the famous five number one what's your favorite business book marketing to mine states willian leach i keep going back to that um there's others propaganda on pr and but with that um marketing to mine states number two is there a ceo you're following or studying uh yeah right douglas sailor he's has a hybrid um method for producing dental and medical uh appliances number three what's your favorite thing what's your favorite online tool for building your company on sauna number four how many hours of sleep i get every night six okay and so what's your situation married single kids uh we're married like 22 23 years i consider i'm an optimist so i consider her my first wife um i'm doing 20 to life with the man's hand how many kids no kids no kids okay no kids and how old are you 53. all right last question take us home what do you wish your 20 year old self knew whatever you do whatever you have to to get out of trading your time for money um so and now i love sas because people pay us for product rather than service yep guys there you have it right kit social media marketing automation tools been at it for five six seven eight years now got a team of five totally bootstrapped they can do whatever they want build whatever they want growing nicely saw thanks for taking us to the top thank you one more thing before you go we have a brand new show every thursday at 1 pm central it's called shark tank for sas we call it deal or bust one founder comes on three hungry buyers they try and do a deal live and the founder shares back end dashboards their expenses their revenue arpu cac ltv you name it 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