How Shipmonk CEO Jan Bednar grew Shipmonk to $225M revenue and 1K customers in 2024.

just got done editing this interview you guys are gonna love it before i do that though i want you to know that i'm going to be in the comments for the next 30 minutes or so answering your questions if there's additional questions you want me to ask the ceo next time i interview them leave them below or if you're just loving the data points i get ceos to share click the thumbs up button below that's your way of telling me you're loving this stuff and i'll get you more of it additionally again i'll be in the comments answering any questions you have all right for 30 minutes enjoy the interview all right jan yeah so take yeah take me back to day one how did you get your first hundred customers so we uh you know it was a challenging considering we were competing with a lot of uh a lot of bigger much bigger companies and we didn't have the economies of scales like they did um so it was really me just going to different trade shows and kind of selling them on this concept of technology and fulfillment all in one um it was a lot of you know selling the dream while we didn't really have that much uh to offer but it was a really high level of server beginning a lot of manual work and you know eventually once the first 10 came in and then the other 10 and then the other 10 we really started building a really good product and a really good technology and it's allowed us to then make it a lot easier to did you find you know in any specific place a trade show a website a forum yeah it was mostly trade shows a little bit of cold calling so you know went to ces was uh was a big one for us because you know our customers are uh e-commerce um or physical products companies so they typically tend to go to we see as is definitely a good one that was the first one i went to um a lot of cold calling just trying to find companies that were local at the time and you know giving them a call and be like hey let's you know we'll get rid of the operations headache for you we'll take that all in and we'll we'll make this happen and um and the first couple customers just really liked the fact that they didn't have to deal with all this you know nonsense of fulfilling orders and having warehouse and employees and that's what that's really helped us you know bootstrap and get started because once you get one it's a lot easier to get the other so help me understand today when you look at your entire customer base are we talking like small e-commerce brands like big ones what's the average customer paying you per year to use the technology [Music] uh well so it really depends i mean there's there's the small ones and there's a big one so our biggest customer is 200 million dollars in revenue that what they do um what they pay us it's about a 30 million dollar deal for us uh but keep in mind it's not just the software fees right they're paying us for fulfillment for shipping for transportation so it's um so the sas b itself is probably going to be more like 10 and 20 of that yeah um but yeah there they so they range from complete startups that literally just you know do 10 orders a month to people that do 300 000 words a month yeah so when you look at like 10 of that 30 million deal would be like 3 million just on the sas product when you just look at the strength of your sas product i mean is that like a 10 million ar kind of business what's the general size of that um that's yeah so i mean we're going to do about 80 million this year in revenue um so i would say probably 10 percent maybe 15 percent of that is sas so yeah about about 10 yep and then when you i mean what does growth look like so if you're going to do 80 this year what did you do last year last year we had 30 uh the year before we did 10 uh the year before four and then one um and we're we're you know we're we were projecting originally to do about 55 this year right now it's looking more like 70 80. um so we're probably gonna end up the year with with somewhere around there and then we're you know still trying to figure out what next year is going to look like but it just changes so quickly that it's really hard to uh to predict or project at this point yeah why did you i mean with with revenue in that range why did you need to do a 10 million dollar secondary why not just pay yourself 5 million out of cash flows yeah well it was uh well it was the two things right i think as a founder uh you know i've always had this dream of taking this business to a specific point and selling the uh uh selling the business and i think it's just when when you're profitable it doesn't keep you disciplined as a founder and if you bring partners in you now have somebody else that you got to actually report to and they bring in a lot of experience from um you know not just building companies but selling them and building great companies and i think that's what really uh i i had a really good friend of mine that did the same exact thing and you know when i heard the deal and i heard out changed his life i just i just figured i would do the same like i could eventually pay myself the same amount it would take a longer period of time because you know as you can imagine with this type of growth like it's not just that easy to take that much money off the table from the company and so it's it's something that we're um you know this has really enabled me to do things that i would have not been able to do and took a little bit of stress away as well um and yeah it's really about the partnership like you know the people that are on my board like i have a board which i didn't have before so it keeps me accountable uh keeps me uh it's uh there's a couple different funds but uh adventure the small smaller guys um that i actually like better than bringing on the bigger bigger ventures because they just uh i just didn't get a good vibe from them this was uh more of a you know they're a smaller 200 million dollar funds but they just these guys really know what they're doing they know logistics they know uh software and it's and they're just more personable and and you know a little more available to me and that's what truly has been you know a great kind of turning point for me just having these guys available and like making me think bigger because before this it was just me and you know some of the mentors i had from before but nobody really like having that much experience working with bigger businesses and being in south florida there's not a huge startup community you know where you get access to a lot of people that have done this so it's it's just been great so jen what's your what's your team size today how many people well so we've got about 450 people um you know different roles different areas uh our engineering team is about 35 people the rest is you know operations customer service um hr finance do you have a lot of inside sales folks how many like quota carrying reps do you have yeah we actually don't have that many sales people we have about seven now um so we've been able to build this business with a pretty good like we're pretty efficient in the way we do sales a lot of our leads are inbound so we don't do a huge shout down you know calling to people uh most of the people that come to us just find us online and then um we can just kind of take them through the sales process and and bring them up to uh bring them in to um and how many how many customers are you working with today a little over a thousand a little over a thousand okay now so okay so some of these you put touch on obviously a 30 million dealer you're gonna put a lot of touch on um you know the average customer are you happy like what are you paying to get them on boarded uh like according to you by itself or like an average uh customer acquisition average cache like fully weighted cache sales people direct marketing spend everything yeah yeah about i think we're about 12 or 1500 right now okay and what does that mean you get paid back in how long well so yeah that's the funny question because in a sad in a sas world it's it's kind of crazy because because it's we get paid typically in less than a month um on that account but it's because it's not as just a service of service fees right so so yeah so the sas formula doesn't really work as exciting because like you know every everybody i tell this this calculation they're like oh well what the hell why don't you just go out crazy and acquire customers right but but there's a pretty significant carrying cost of every account um and it's you know we got physical constraints because we've got warehouses we got infrastructure we got people so um it's not as easy to scale like we're growing as fast as we can and we're you know expanding it's like amazon right like there's so many buildings you the constraints that we're hitting um but yeah like i mean our cost per acquisition and and how quickly it pays for itself is super quick it's typically less than a month yep now are you burning cash today are you profitable no we're profitable your product because you're profitable as you grow i mean are we talking like 10 percent even to...