Supportbee Revenue & Valuation (2024)

hello everyone my guest today is anna mohan she is building a customer support software for collaborative teams she's an entrepreneur cyclist and aspiring writer and she's a proud transgender woman pronounced she and her and lives in barcelona with her two cats honey ready to take us to the top uh yeah yes and one of my cats right there as well i see she looks very comfortable back there on that chair yeah he's having a good good time yeah very good all right so so tell us about support b is it a sas platform and if so uh walk us through some of the backstory when you launch yes support b is a sas software for customer support and we launched publicly in 2012 and then a couple of years before that we started work on it so i'd say somewhere in 2011 is when we started working on it and launched it late 2012. and who is we i started with my co-founder nithya and she still works with us she's doing customer support and customer success okay very cool and where did you guys come up with this idea were you doing support inside of another company or how did you come about um so it's interesting nita and i before support we had another business called musical it was a music sharing platform sort of like soundcloud but more community focused like flickr and uh while we were doing that we had over half a million users and we were using gmail to do customer support but it sort of like lacked a few collaboration features and then every software we tried back then was pretty complex so we sort of just wanted like an upgraded gmail experience and and then once we were looking for new ideas because we wanted to move to software as a service uh this is what we started working on that's fascinating and are you playing for the smb mid marker enterprise space in terms of average price point um we are actually an smb i think we have tried to go up market because the temptation is always to go off market and we found ourselves in that sort of struggle for a few years and starting this year we are like you know doubling down on our focus to be small and medium sized yeah okay so what does that mean in terms of uh what's the average customer pay per month would you say um so they pay about a hundred dollars a month okay and what do they get for that usually or is it seat based model or do you upsell based off something smaller yes we experimented actually with um with a ticket volume based model and while we thought it was great and a lot of our customers thought it was great we found out that people really uh tend to over estimate the ticket volume so they tend to be much more uh aware of how many people are gonna be voices how many tickets they're gonna have so we finally switched over to uh um to an asian based see your seat based model yes yes yep okay so so i'd say about five seats you know okay five seats for a hundred bucks okay that's great and and you know obviously getting the first 10 customers is the hardest part right so you're writing some code in 2010 2011 you're officially launching in 2012 taking back to that moment when you landed the first customer who was it um so we um back then we were one of the first customer support software to have like a sort of a gmail like single page um you know no page refreshes uh that sort of a interface and it was pretty fairly new back then to be building those things this is like five years before react and all of the buzz so i used to write a lot of blog posts about these things and posted on hyper news and that's how we started finding some of our only customers to be honest interesting but interestingly uh our very first customer paying customer we had some people use this for about a year before we started rolling out payments and our very first paying customer is a company called drills and cutters and they they're exactly what the name is they sell drills and cutters online and they're still using us so like a fairly non-technical team so i'm not quite sure how they landed on support b uh but they were the first ones to actually start paying that's interesting and they do they i mean do they tell you how they found you was it through hacker news i can't remember it might have been i think we i experimented with like putting up pages for zendesk alternative and so i think it might have been one of those things they definitely weren't the first people to use support but they were the very first ones to pay okay so first this is first ones to pay back in 2012 2013 how many customers do you have now today uh we have about 450 450 okay and what does that mean in terms of how much revenue you're doing each month so it's about 45 000 a month some of them are on annual some of them are on monthly but that's the average this is impressive so 450 customers 100 bucks a month 45 grand in monthly occurring revenue and have you done this on have you done this all bootstrapped yes actually we've never raised any money love this i love this so so difficult to do and where where's home base where's headquarters uh so we incorporated in the us as a c-corp as a delaware c-corp but uh we don't have an office anymore we didn't have an office for a while then we had for a couple of years in bangalore because i think we had this phase where we thought okay we should be in bangalore we should raise some money and you know we should hire all the talent we can but i think very soon i realized i can't really do it it's um i don't think i can be in a super busy tech ecosystem all right so where i mean where are you sitting right now so i'm in barcelona spain uh my uh co-founder she's in san diego in the us uh i have a couple of new team members in barcelona that just came on board and then i have a i have one developer in um in india he's been doing our back-end stuff and then one in bolivia so we've been remote fully remote since 2015 and even before that we had a strong remote ethic so what does that mean so i just adding up the numbers how many people total are on the team and how many of those are engineers um so two engineers um then my co-founder who's doing customer support and success um i i basically just keep the whole thing running um in terms of the business and trying to think about growth and we've just added one person who's coming on board for growth so we have two people who are sort of ramping up from being freelancers to coming on full-time so i'd say four people full time and then two people who are transitioning from part-time to full-time okay got it so i mean you're i mean four people and forty five thousand dollars a month that's a revenue per employee of almost ten thousand bucks a month which is really i mean it's impressive for early stage sas company yeah i mean it's super impressive so i mean that must mean you guys are extremely profitable is that accurate um yeah we can all uh pay ourselves a good salary we have been saving some money to invest in growth which is why we can this year at least we now we are planning to sort of um you know invest a bit more in marketing give to our own detriment we have never really invested anything in marketing we've never had a sales team and um it's it's great that we got so far but i think we we sort of want to shake things up a bit now well so how have you done all this without marketing a sales team i mean you have 450 customers how did you get your second you know three you know 449 after the first one well obviously i mean as you understand sas pretty well uh we actually got a lot more but then some of them churned out um we have i think we just have a good sort of search presence organic search presence uh we have some integrations we are listed on base camp on asana so we get some but really to be honest i think i personally think we can do a lot better but it's all been organic so far yeah i mean one of the things that yeah yeah well i'm just gonna say one thing i found interesting when i look up support b on ahrefs my go to tool for anything seo you guys have an incredible domain authority right it's pretty high domain rate at 72. uh however you only get about 2 000 organic clicks from search every month which is really low for a website that has that much authority which tells me there's a massive opportunity there but you currently rank for about 2 900 keywords which keyword right now is bringing you the most trials and customers would you say i'd say um it's fairly distributed um i'd say it's um perhaps um some variant of ticketing systems like supporting a link system ticketing system something like that so i think this is what i kind of learned over the years like painfully so is uh there's a difference between like having pages for you know things like ticketing system or knowledge based software versus like just generating a lot more content uh which like targets a lot of long tail and that's the opportunity you're talking about so now we started doing that now traffic has grown quite a bit but you know i think we have to work on converting them to trials and so that's what we are working on now you rank extremely high for a competitive keyword support ticket software in fact that brings you almost 50 organic clicks a month i think it would be more but it's 50 a month maybe the reason it's so low is because so many people are spending ads on the keyword i'm seeing right now you freshdesk zendesk kayako and talkdesk all pay for that keyword you're number one organic and you're beating hubspot and zendesk and others how did you beat those guys in the organic rankings i think we just have um well i wish i could tell you exactly the formula but i think we've just done like sensible stuff always have a you know a side that loads fast uh never done any gray hat black hat sort of thing and um the keyword that surprises me is actually uh shared like best shared inbox or shared inbox and even more competitive in some ways uh that we rank up for so i i'd say just like doing the most sensible things like good linking structure things like sort of like google's web start seo starter guide 101 things were just done consistently over time yeah you all my favorite person you guys did was uh and it ranks for the keyword email response to angry customer examples yeah that does really well for you guys okay so let's see performing content right now yeah yeah so seo is part of your strategy but take me behind the hood a little bit here in a given month how many new trials will you sign up and how many convert to paid typically i think we sign up about uh and this number has stayed fairly constant um which is what we want to grow now it about 120 a month trials yes leads trials people who sign up for the 14-year trial yeah okay and how many of those the end of 14 days convert usually it's about 10 so like 12 to 15 something like that yeah so you're growing mrr by between 1200 and maybe 2 000 per month something like that well i wish but we also do see some churn so at least in the last six months we've sort of been a little flat to be honest what is churn look like maybe on an annual or monthly basis what's revenue churn so on a monthly basis the revenue churn looks about 2.5 to 3 percent and i think the lower churn is about similar three-ish percent okay so sort of 30 percent annualized yeah okay which i think for the uh yeah for the segment that we are and we i think it can be improved but probably there's better places to invest our energy in right now that's what i believe yeah now do you i mean churns fine especially if you get like your cac paid back instantly right your economics makes sense it sounds like you're not doing a lot of paid stuff but there are other forms of cac what was your total cac right now would you say to acquire 100 a month customer i only wish i had that number i don't because even content is so new for us now we're investing like a certain amount in producing content every month but we really haven't nailed down that funnel we started we really started uh we haven't started uh trying to like for example a great example of that is we only have one action that you can take which is to sign up for a trial you you can't really sign up for even newsletter or so i think like once we put that in place and we measured maybe in a year from now i'd have a better answer yeah i mean early stage sas the best way to calculate cac is to take everyone who's not an engineer so anyone focused on marketing product sales take all your salaries monthly and then divide that by number of new customers you're getting each month right yeah right paying customers or yeah paying customers so i would say yeah i'd say in that case let's say um it'd be about um like four hundred dollars or something i guess yeah yeah so what so what you're saying is you spend about five to six thousand on salaries of people focused on product and marketing that divided by 12 gives you uh sorry that divided by uh well i mean if i just take the marketing cost let's say the content cost because i do think customer support or success is an integral part of but yeah so i didn't exclude that to be honest okay okay okay got it so a 400 attack and you're getting 12 new customers a month right so you're basically saying you spend about five grand a month right if you had to calculate it on on camera yeah you're pretty good at this yes yes yeah yeah yeah so 5 000 okay that interesting okay so that makes sense uh economics obviously makes sense there so so what's the next i mean what's the next move i mean how do you guys go from 450 customers to a thousand well i think um like i said earlier in the interview um this year we sort of want to double down on our positioning for the small businesses the small businesses that actually wanna invest in the customer experience and uh so we are sort of doing like a brand overall uh because uh we are obviously in a very crowded space and if you if you visit most software it's kind of hard to have um like unless you try everything out as as a very um as sort of an average consumer it's hard to sort of know which one is for you so i think like we're trying to be a little bit more polarizing that if you fit into our perfect market segment then you find us really attractive and if not then you probably you know you think that you know we're not that great but either ways i think be a little bit more so with with our like and in fact those are some of the people working with us part time so like a much much more vibrant color so much much uh the copy written in a way that appeals to the smaller businesses uh things like that so i'd say just sort of like focusing on some of that and then like continuing to produce more content um investing a little bit more into customer success so it's not just about doubling the customer base but also reaching out to some of the people who churn out because maybe they couldn't figure out the product things like that so all of that sort of put together and maybe taking a more long-term approach to be honest and before you make a bunch of these moves i mean historically what's the company grown out over the past 12 months what was revenue 12 months ago so we did do some upgrades for some old customers and and that helped us grow a bit in the last 12 months so i'd say about 30 or so okay got it so you were doing call like 38 39 000 a month about a year ago two years ago yeah and in order to drive this brand overhaul and maybe make some critical key hires i mean would you consider raising capital or no not at the moment because i think i'm pretty uh i think unlike 10 years back now i know what story sort of you need to sell um so not at the moment but let's i'm curious to see how things pan out in the next 12 months and uh based on that if we need to then yes but i don't want to consider like you know probably sorry to cut you off but like revenue-based financing other other options too like as we get a better sense of podcast we start investing a bit more into uh you know paid advertising at least retargeting things like that i definitely don't want to rule out revenues based financing yeah there's a i mean look i launched a side project a calculator to figure out if you wanted to raise debt how much you could raise at founderpath.com and we are seeing incredible demand of sas entrepreneurs are bootstrapped using it to do exactly this fuel their growth it's not revenue based financing it's it's term it's it's a fixed interest rate but same same same idea all right anna let's wrap up with your famous five here number one what's your favorite business book um i'd say it's not exactly a business book but it's a book called brain at work your brain at work which really helps you understand how to use your brain more effectively number two is there a ceo you're following or studying um i actually don't follow a particular ceo i try to be more inspired by people around me so people running restaurants people doing great art things like that number three what's your favorite online tool for building your company uh at the moment it's notion notion yeah number four how many hours of sleep i get every night i sleep well i get about uh seven to eight hours okay good and what's your situation married single kiddos uh no i'm single okay no okay and uh uh let me see here single no kiddos and um how do you mind sharing how old you are today i'm 37 37 okay so the reason i ask that is take us back 17 years what's something you wish your 20 year old self knew um that's a great question well i'd i just i'd say broaden your horizons you know um just meet a lot of different kinds of people look into a lot of different kind of things get more plugged into the world you are living in guys there you have it support be first lines of code in 2011 first customer 2012 some early hacker news support now supporting over 450 teams as they manage their support tickets and their inbound customer complaints they're each paying about 100 bucks per month so 45 thousand dollars a month in revenue with a team of five hybrid per employee that she's totally bootstrapped anna thank you for taking us to the top thank you so much