Seotify Revenue & Valuation (2019)

hello everyone my guest today is jam akbolt he is an artist programmer fascinated by big data and founder of seo to fi.com developing web apps you never thought possible solving problems you didn't know you had jam you ready to take us to the top i am let's do it okay pronounce the name of the company for us so i make sure i get it right is it seo to phi or or co defy it's certified okay co2 is it an seo play yeah um excuse me is it an seo play it's yeah it's codify.com cotify yeah so what's the company um we develop web analytics applications for online marketers okay so is it an agency or a sas product sas product okay so so what do people pay on average per month on average per month um we have customers paying to us uh seventy dollars per month seven zero seven uh yeah seven zero seventy dollars okay and this looks like it's kind of like crazy egg or hot jar it's kind of like a heat mapping analytics tool um it is yeah but with some important differences um it is a actually new branch of web analytics um we created it's called competitive heat map analysis okay and what does that mean why is that different than regular heat maps um with a traditional heat map analytics tools like hot jar you can only see a hitman data of your website but competitive hitmap analysis we developed you can have access to any website's heat map and engagement data okay and how do you get that data um we collect our data on a visitor site if you are if you are using traditional solutions um you have to install uh javascript yeah i under i understand that my question is for somebody that doesn't know you let's say i want to go get my competitors heat map and they don't have any javascript code on their site for your tool how are you getting their heat map how are you tracking their visitors um it's the same way amazon's alexa or similarweb.com operates we have our browser extensions that provides our customers with toolbars as our customers have access to our features on their browsers we collect their click data and offer our solutions on the website okay jim sorry i don't understand what if what if no one has gone to the competitor's site and clicked around there what if there is no heat map data yeah it's been about two months since we launched our application and since then we have collected more than 100 050 websites heat map data and that's not a lot there's not a lot but every single day this number is increasing okay so just be clear someone could sign up for a ceo to fight today and say give me click map data on x website and there's a good chance that you don't have any data for that website oh there's good chance uh we have you well you only have 150 000 websites index there's there's hundreds of millions of websites yeah but um only very small portion of that websites are active and used by uh people okay when did you launch the company what year and we have a recently made a major pivot and devoted our resources to building and improving this technology uh company co25 was launched in 2016 as a service business are used to sell web development and search engine optimization solutions to small businesses okay and how much how much revenue did that business do before you started building codify um in our service business yes or sas service uh we've had about um 17 close to 10k a month okay recurrent revenue in monthly recurring revenue on the wait a service business is usually not monthly recurring in your service business how much revenue we had seo clients mostly they were recurring mostly they were monthly paying to us and on the sas product today how many customers do you have we have about um little more than 6k 6 000 users how many customers 230 of them are paying okay today so 230 customers paying 70 a month you're doing about 16 000 a month right now it's around um 12k because we had lower price points in the first few weeks you were testing yeah testing the waters what'd you launch with this is a big question entrepreneurs have is what price point to start with what price point did you start at and why did you edit it um i started with um 16 it was a smaller smallest package in the website um major majority of our customers came from product hunt we've had a great success on our first day there um so how many how many how many new users did product hunt drive you i would say um maybe 80 to 90 the rest of come from um my personal network so just be clear when you launched when you launched on program you got 80 new users from product time new customers or users customers 80 customers and how many new users new trials um i don't have the exact number but we have 30 percent trial to paying customer rate ratio okay uh but you just said you have 6 000 users correct yeah but um like i said we have recently pivoted uh before that we had um premium model we used to offer our users some yeah that's fine but 6 000 users and 230 converted to paid is a 3.8 percent conversion rate not a 30 conversion rate where do you get 30 conversion rate from 30 um i'm talking about it since today we have launched competitor competitive heat map analysis okay so over the over the next month over the next let's just look for it over the next month how many new trials will you get and how many new customers will you get from those trials um right now we are planning to receive about 200 to 250 trials in the next 30 days and how many were you converting to paid customers um 30 should convert to paying customers so that's like 75 75 out of the 230 you think yeah okay and why is your conversion rate so that i mean that's a high conversion rate how did you get your conversion rate so high from free to paid well um i would say it's laser targeted uh customers um how are they finding you though i mean where are you getting them from right now um combination of inbound and outbound marketing that works for us give me a specific example yeah uh we are running advertising pay-per-click advertising uh on what channel quora okay pp so ppc on quora and so what does it cost you to get a new free trial from cora it costs me about um 22 thirty dollars in average per trial okay and you need four trials to get a new paying customer yeah pretty much okay that's good so maximum you're spending about 120 dollars to get a new 70 a month customer yeah that's pretty good why not put it why not put a million dollars into core if it's working so well well um it's a booster trapped company and in the future i'm considering a raise some capital but before i take investor dollars i wanna actually make sure we have the product and market fit what's the team size today how many people we are a team of three international including me okay you guys are so you're all remote international or remote yeah okay and have you raised any capital today or you're totally bootstrapped not yet totally boosted okay are you are you are you paying yourself yet well um i've always had um search engine optimization under my belt so i i have side hustle stay that keep me above the water and pay the bills so i'm not taking much out of the company okay so you're doing like consulting work for companies helping them with seo no i have affiliate websites for what for what kinds of products amazon okay like name one of them so we can go to the url oh well uh i don't think i should do that why because well uh these affiliate websites are pretty much vulnerable i could give you one of my um wait why are they vulnerable is it does amazon does amazon not like that you do this not amazon but our competitors go after the keywords we target and you know i could give you my uh youtube channel though your what channel youtube why do i care about your youtube channel you asked about my um affiliate projects yeah so how does the youtube channel relate to your affiliate project but we review our amazon products on youtube and pretty much the same thing with the websites okay can you just name can you name one or two products just to save us time oh one or two it's impossible we review thousands of products on our affiliate website name name name a product that you've sold a lot of like are we talking like a drill monitors monitors and mainly technology products gaming laptops monitors okay interesting all right so so bootstrap today using the affiliate revenue to help pay yourself while you fund the growth of the company are you operating at breakeven today are you guys burning cash uh we are um cash positive right now by how much 5000 okay couple thousand a month yeah that's good congratula congratulations um and then in terms of growth you said you launched you said you launched in 2016 and today you're doing about 12 000 a month what were you doing about a year ago about a year ago um we've launched a couple of failed products um a few years wasted so is co2 doing nothing a year ago a year ago we've had uh we've had an application called world assistance no no jim i'm just curious about codify the thing we've been talking about the whole podcast so a year ago co defy how much revenue was it doing a year ago uh we weren't doing much like how much zero or a thousand or what uh four or five thousand okay okay good so you're more than double d over here which is nice different application after pivoting we are taking off and do you have any idea what your churn is yet it's too early to talk about sean i mean uh we have lost maybe four to five percent of our customers in the past two months but i don't know what time it will bring okay so five so north of five percent kind of annual churn but you only have two months of data yeah okay very good good stuff jim let's wrap up with the famous five number one what's your favorite business book um it would be peter teals zero to one number two is there a ceo you're following or studying you almost number three what's your favorite online tool for building the business cool number four how many hours i sleep to get every night it varies a lot in average six maybe seven okay and what's your situation married single kids well i'm a startup founder so no life outside of work single okay not married no kids and how old are you 24 24 last question what do you wish your 20 year old self knew um don't be afraid to make mistakes no one really cares guys don't be afraid to make mistakes nobody cares he started with an agency then pivoted to a sas model codify which again helps people do competitive heat mapping intelligence you can go to and basically get heat map data from your competitor's website without your competitor really doing anything related to the product they do this through a browser extension they have uh let's see 230 customers paying caught 50 60 bucks a month on average so 12 000 a month right now in revenue up from 5 000 a month just a year ago they're cash flow positive about you know two three grand a month right now team of three in remote locations north of five percent annual logo churn too early to talk in detail about that but spending you know about 120 bucks on core ads to get one new paying customer so about a two month payback period as he looks to scale jim thanks for taking us to the top thank you my pleasure