Sentisisrevenue & funding

hello everyone my guest today is jorge penava he's an electrical and computer engineer with a masters in cs in iit he started census his current company as ceo in 2012 the leading service for customer experience in the spanish language uh working with clients in europe north america south america and asia he's looking to expand jorge are you ready to take us to the top yeah sure okay what is synthesis and how do you make money yeah so synthesis basically is a sas platform where we analyze customer experience conversations mostly in social media but also in other channels like surveys or other customer touch points um and basically we focus on the spanish language and um what does the average customer kind of pay for this would you say uh on average it's uh about uh 3k a month okay 30 to 50k contract a year and what are they getting for this so basically it's a platform where as a base like the base customer can monitor uh their conversations in social media and other channels and our main value is that the analysis is adapted for the spanish language so we have a specific nlp for the spanish language and its different variations so in spain colombia mexico spanish language is different so they get their information categorized in the main problems about their industry and the sentiment of those conversations that's great and then when did you launch the company what year uh we launched in 2012 march 2012 2012 very good and uh bootstrapped or if you raised capital uh we've raised capital but not a big amount of it so in total including debt we've raised two million who which firm did you decide to work with for the debt uh so we worked with uh actually the spanish government has a couple of dead vehicles and one of them is for innovation another one for young entrepreneurs is it is it revenue based financing where you pay back the percent of revenue or is it a term-based loan with a fixed interest rate uh it's mixed mostly a term based but the interest rate gets a little bit higher if your revenue is very high interest rate is higher if your revenue is high yeah exactly why would your interest rate be higher if you have higher revenue wouldn't it be higher if you were lower because there's more risk uh no because they're like kind of like investing when there's a lot of risk and they try to make a little bit more of money uh when the company is going oh interesting okay so it's more like a grant structured as a term load yeah yeah interesting and what have you scaled to today in terms of total customers uh so at the moment we have about uh 80 customers eight zero yeah approximately okay now can i take 80 times that 3 000 price point you guys are doing about 240 grand a month right now in revenue uh exactly yeah okay that's great and what we got a year ago a little a little bit less than that uh so about 200k a month okay and what were you doing about a year ago about a year ago we were about uh a hundred and thirty k approximately a from there 40k okay so good growth whereas we've been growing in the last years about 40 50 a year yeah where's most that growth coming from new customers or expanding current you know past customers uh that's a good point so actually one of the one of the uh like main uh strategies we focused in the past years was um in the customers that we have that were already working uh with their social media data we saw that uh as our value was on the analysis for the spanish language they wanted to analyze other channels and that's how we grew from just being like a social media analytics or understanding as we said because we understand the data platform to a customer experience platform right so 30 of our revenue historically has come from uh cross selling or upselling current customers what does revenue churn look like annually uh so revenue turn um like depending if you measure it of course by uh total revenue churn or lower churn uh but we're about 10 to 15 uh a year okay 15 revenue churn per year is that right yeah and is that gross or net uh that's uh um yeah so uh have you added back expansion revenue no okay when you add back expansion how much expansion do you have yeah so about uh fifteen percent so we're saying we make like thirty percent on expansion a year so just be clear if you're losing 15 and then you're also expanding 15 that means your net revenue retention is about 100 yeah exactly yeah your expansion makes up for all the lost revenue is that true yeah exactly yeah that would mean net revenue retention is 100 is that right yeah okay very good and um walk me through how you're getting these customers where are you finding them uh so basically we mostly do uh outbound marketing uh in terms of like in the countries where we're present so we're presenting in spain representing mexico colombia chile a little bit in miami too um and basically we're targeting uh big marketing departments uh and customer experience departments where uh they uh have a lot of data that they wanna analyze or they wanna capture data from the internet and analyze that data right and another uh source or that's about uh 60 of our customers come from outbound right so cold calling and going to events and about 30 40 percent come from inbound as we've been building a brand over the past years in each of these countries and we do content marketing some of them reach reach out to us on the website download some of our content or reach out after one of our marketing campaigns to mailchimp so what's your just obviously there's a bunch of different tactics here but when you look at kind of your overall fully weighted cac what are you paying to acquire a customer uh so approximately we're paying depending on the biggest and smaller between three and uh five to six k okay so five thousand dollars yeah okay and that's to get called a two thousand or three thousand dollar a month account so payback period is two or three months yeah okay that's good and what's the team size today uh the team size is 40 people 40 and where's everyone based uh so all our technical team is in madrid in spain we also have a small team in malaga with uh our linguist team linguistic team and also uh we have uh specific business teams in each of the countries where we're present so we have mexico we have a team in colombia and a team in chile that's great very good all right let's wrap up here with the famous five number one what's your favorite business book uh my favorite business book is probably crossing the assassin the cousin number two is there a ceo you're following or studying right now sorry can you repeat the question is there a ceo you're following or studying right now a ceo oh yeah i love um jack ma from alibaba he's actually now kind of retiring yep number three what's your favorite online tool for building your company uh favorite online tool for building my company is intercom um because uh you get a lot of engagement before using the product and once the customer is already using it and number four how many hours of sleep do you get every night oh that changes a lot especially if i'm traveling but probably between six and eight okay and what's your situation married single kiddos uh i'm single i'm single i'm 30 now i'm i'm i've been okay not married no kids and you said you're 30. yeah last question what do you wish your 20 year old self knew uh probably so my my 20 year old self was a very with a very engineering mindset uh and i would probably tell him to care more about people um rather than just the numbers yeah care more about people whether than rather than just the numbers again launched sentences back in 2012 today 40 people building out 80 customers paying 25 100 or 3 000 bucks per month so doing about 200 grand per month in revenue that's up from 130 000 bucks a month just about a year ago 2 million dollars raised mainly or a chunk of that from the spanish government fifteen percent revenue churn per year but they're expanding by the same amount so net revenue retention about a hundred percent year on year spending five grand to acquire a customer so between a three and four month payback period jorge thank you for taking us to the top oh thank you so much for your time