How Scripted CEO Sunil Rajaraman grew to $9.1M revenue and 500 customers in 2024.

hello everyone my guest today is doug breaker he serves as the ceo of scripted.com a marketplace of freelance copywriters and providers of strategic content marketing services doug are you ready to take us to the top i am let's do it all right so very good talk to us about the company what's scripted do and how do you make money is this kind of a marketplace plus sas model yeah so i joined scripted in february so i've been here about 10 months now um prior to me joining scripted was a freelance marketplace a marketplace of freelance writers you could come in get anything written you want a blog post a white paper what not um since i've joined we've we've we're moving a bit more towards kind of managed content marketing um to be an alternative to facebook ad spend or google ad spend using a whole bunch of crazy analytical seo tools to give you the kind of the most efficient most effective content marketing calendar possible okay so i'm going to try and decode that you're moving more enterprise no not enterprises actually our target customers are usually you know five to 100 people we're usually dealing with the founder uh ceo type ahead of marketing okay uh companies that really want to get tons of qualified traffic uh without having to go pay adwords or facebook ads you know continually for that traffic and i mean generally speaking is this like a sas model they're kind of paying per month and their services on top of it or how do you structure pricing yeah we have a subscription fee every month and then the content is extra i see okay and and what is the so let's break down both those i'm sure you have a bunch of different cohorts but on average what's just the flat kind of sas fee per month yeah we have three levels uh we have 149 uh 299 and then our cruise control is kind of the managed content marketing is uh right around a thousand bucks a month okay so what would you say like a fair average is like 500 a month or 100 or yeah somewhere around there and then okay 500-ish 500 yeah okay interesting between the three plans interesting now everyone listening right now what they're going to be thinking is well wait a second is there touch on this thing are margins crap or is he still in the 85 kind of percent range even with some customization here yeah no our margins are pretty solid so the the subscription fee goes you know that's all margin um with you know their stripe fees and everything else and then the content fees we don't actually make that much off the content um uh but the subscription fees make up uh a good portion of the money even then it's a loss leader yeah and then on the higher plans you know we're charging a thousand bucks a month you get an account manager for that but one account manager can handle enough accounts or that still comes in at good margin yeah that's interesting how many counts typically uh we're above 20 for one account manager now i mean that's pretty healthy and uh put this on a timeline for me i know you just joined recently but when was the company actually launched uh don't quote me on this but 2011. so just a bit of background script is owned by a little private equity company named xenon xenon ventures it's xenon.io if you want to check it out so xenon's whole thesis is hey we'll come in and buy sas companies that have raised a bunch of funding that are you know five six seven years in that aren't going to make it to the billion dollar valuation that they thought but that they want a graceful exit um so xenon purchased scripted last summer and then i joined in february after rolling off a prior xenon company um earth class yeah and that was the exit i believe to scale works yes exactly it's funny that you know you know seagull lume mormon ed san antonio kind of mafia it's a very tight crew there it is yeah yeah were you at rackspace too no i came out of orbitz.com the travel site and then uh homefinder.com which is a big real estate website interesting and so just out of curiosity since you kind of went from scales works to xenon i'd say xenon is just basically playing on on smaller companies than what scale works is that what do you like more about kind of the smaller xenon approach versus scale works yeah and just to give you a bit of background i've known jonathan siegel since 2007 since my orbit stays so he and i have been good friends for the a long time and he brought me into earth class mail so i was actually xenon before scale works oh interesting back to xenon um but yeah the difference is xenon does smaller companies so typically employee size under 10 um or maybe under 20. revenue size you know usually it's under five it totally depends on the company where scale works their skill set is much more applicable to companies that really need to grow employee base so like definitely above 20 people yep um and these are just rough numbers but um and then the challenges are a bit different so xenon is much more you know the kind of the smaller company and what is your team size today we're at nine right now at nine that's good small nibble that's great raised any capital since the acquisition or no just bootstrap basically no xena and what we do is we uh we get cash flow positive um and then build growth off of off of cash flow so you are cash flow positive today yep that's great and over the past kind of since you've joined what have you scaled total customer base too um we are in the upper hundreds okay um but the cruise controller our kind of managed content marketing went from zero in may and now we're uh let's say almost 50 on that one okay that's great yeah that's great so well yeah so i mean i can when you say upper hundreds i'm gonna assume that's like between 500 and a thousand is that a fair assumption yeah that's that's good okay so i mean look i mean if we just take 500 there as a minimum and then take that arp who you gave me earlier you know i can obviously do the math i mean that would put you at a minimum of kind of 250 per month is that generally accurate yeah okay and what's growth look like so a year ago where we're at by the way i should disclose this to you in case you haven't heard it we did have uh ryan on who is also now back with xenon as you know brian's a good friend he came on the show though before the sale a couple actually i think that's how jonathan siegel i actually connected i believe i'm not sure if i can take credit for this but i think i actually connected them so ryan told us when he came on what they were doing per month and it was like around 150 but that was like i want to say 18 19 months ago so where were you at a year ago yeah 18 19 months ago that was ryan was right there um we were a little bit above that okay uh so they there's a space last fall where they spiked a little bit they launched a like a managed service product but it was sell everything to everybody and that one churned really hard uh so we kind of had a reset earlier this year um but we're growing not like nearly as fast as everybody wants because nobody ever does that uh but we're growing enough yeah well just to be clear so something about a year ago you might have been about like 180 a month or 190 a month something like that now you're 250 north yeah those are generally pretty accurate yeah that's a good healthy growth and is most of that coming from expansion you know selling these managed things to the old base or its new customers totally a little bit of both so the the way we're doing cruise control now um we get definitely some expansion off of that of old customers that just say you know hey managing this myself is too hard and doing all of the hours and days of seo research like i'd just rather have you do that and then we're also bringing in new people to that too to say in we're doing actually pretty well with um like portfolios so whether it's like a small pe portfolio or a guy with like three sites um or woman doesn't have to be a guy uh where he says you know i really like this i want to do it for this site and then i want to do it for this site and i want to do it for this site um that that's you know there's a decent amount of the cruise control base that looks like that yeah that makes a lot of sense talk to me about revenue churn per year what's that at way too much what is it like twenty percent thirty percent totally less than that uh between ten and twenty okay um yeah it's it's hard because we we charge a fee whereas upwork doesn't charge a monthly fee you know most of our competitors there's a bunch right or acts well writer access charges if you know but um text broker that if you just search like content writing like the whole first page of google is competitors that don't charge a monthly fee yep um and writing quality varies but uh so we charge a fee so that that is contributing to churn um and then we need to do a better job of showing people exactly how to do content marketing um because when it's done right it really really works and it's a better investment than paid ads yeah um interesting okay so ten percent revenue return per year i do know though that you guys are at least running some tests this is typical siegel playbook in terms of testing if you can spend a dollar to get two bucks what are you spending on cac right now uh total blended is right around a thousand bucks okay so that's good 500 bucks a month on average coming in so your two-month payback is max yeah and we're eating our own dog food so we're doing a ton of content um stuff and so that's it's not quite as trackable as the paid side um and so the question is like hey how high can you push the paid side uh does that scale with spend right does the tax stay the same as you spend more um and then on the content side it's it that's like a good year investment um you know you start you can get early hits but you know you really have to put a good six to 12 months into that to see a really great return on it yeah but you do which is which is awesome and the nine folks you have is everyone in chicago or are they all over uh seven are in chicago one is in vegas one is in san fran right now okay so chicago and kind of remote um walk me through in your head how you think about what you're doing right now because kind of this model what seagull there's a lot of these firms like this popping up that are like a xenon or scale works right they're called less than 100 million dollar fund buying million dollar to 10 million are companies running a playbook and then flipping and selling them so do you see yourself as like you know in your head you got to get up you want to get up to maybe four or five well actually already north at but let's say you want to get to 5 million bucks in arr and then you're gonna you know your sky in san fran is going to sell it for you know 4x and then you're going to stay in xenon and do the next project is that kind of how you think about it or yeah everyone's unique like so when i was at earth class male xenon sold that after 18 months to scale works um and then i stayed on for another 10 months uh and then just decided to come back into xenon it all depends like i think each one's unique it worked out for me this that way this this last time and we'll see what happens this next time but generally that's the plan of hey yeah come in get a cash flow positive grow it you know make it really attractive to to sell to a strategic um and then you know see what the deal holds um if if it's a great company you want to stay you know stick around if not i mean stick around for a little bit and then then walk and do the next one if you're only optimizing for personal wealth uh would based off what you've seen would you say it's more effective to buy companies and turn them around or to start them all from scratch definitely buy yeah i totally agree with you by the way no one no one thinks about this but i agree yeah no the the founding teams god bless them have gone through all of that pain of like building the product finding the customers building the base um and then having seen so many of these things now through xenon uh we we come in and you know and you can see the similarities and what works what doesn't um so it's it's much easier to come in and buy than than to build from scratch i agree all right very good uh let's wrap up here with the famous five number one what's your favorite business book uh favorite business book is good to great by jim collins number two is there a kind of under the radar ceo that you're following in chicago in chicago um he's not ceo anymore but uh my buddy chris brown uh i knew i met orbitz he ran kapow events for the last three years and just sold it um he's amazing i don't think his next gig is public yet so i'm not allowed to say but all right good yeah number three what's your favorite online tool for building your company besides your own [Music] um great question um it's not ours but just content um and like very well-written unique awesome content um because you build the followers and you build the people interested in it and that just keeps paying dividends over and over again vista owns automated insights they bought it a while ago and they essentially create content you upload a data set and they basically make it sound like natural language so a lot of people when they do like their investor reports will use this you don't come across them when in your sales process do you at all no but narrative sciences which is a competitor is here in chicago as well and we talked to them a bunch when i was at home finder the real estate website about creating automated real estate content but it's not something we worry about too much uh with scripted and what we do um it works really well when you have a like really defined data set um and it the form the articles are really formulaic yep uh but that's just a small portion of content out there yeah so just be clear your engine is still powered by a huge army of freelance writers exactly yeah and we've heard that with a lot of data like hey here's what's ranking on google here's the word count here's the readability grade level here's the seo targeting score go look at all these articles come up with something that you think can be better yep number four number four how many hours of sleep are i get every night i have four kids so it really varies on geez doug anywhere between five and eight okay somewhere in there cool we'll call six and a half there on average and situation obviously four kiddos married oh yeah married 12 years now congrats that's great and how are you i am how old am i 42. 42. last question what do you wish your 20 year old self knew um i would tell my 20 year old self to just start starting businesses um it wasn't quite as easy then that was a it was right around 2000 um it got a lot easier in like 2005 2006 but just start just start start companies faster guys there you have it from doug scripted company founded back in 2011 he came in about a year ago uh we had previous founder on but they're bootstrapped to date part of xenon they've got about five north of 500 customers paying in our poo have caught around 500 bucks so about 250 grand right now healthy growth caught up from 180 grand a year ago he's trying to figure out how to bring revenue turned out currently it's 10 caught between 10 and 20 revenue churn per year spending about a thousand bucks to get a 500 a month customer so two month payback nine person team in chicago and other remote locations again helping you scale your content marketing doug thanks for taking us to the top thanks so much