How Syndy CEO Pieter Van grew to $2M revenue and 100 customers in 2019.

hello everybody my guest today is peter van gerpen he's the founder of cindy the online platform that simplifies e-commerce product content delivery for brands to retailers today thousands of brands in europe and asia use the company to streamline product content delivery to online retailers with a strong focus on the fast-moving consumer goods industry noteworthy clients include unilever nestle and many many others like coca-cola and mars peter you ready to take us to the top yeah let's do it all right so what exactly does e-commerce product content exchange mean help us understand that all right um so uh you know how we buy products in store uh like you know the nike nike shoes that nike cap you're wearing and these are all physical products and but online these products are made out of content uh retailers rely on on brands to get that content because it's way too expensive to build it and you know photography commercial tax all that stuff yep so they asked brands to fill to kind of give them that content and what we do is we distribute the content for brands to retailers and what we really do is we sit between the different systems that brands and retailers use to store content internally like product information management tools erp uh kind of systems and we're like a middleware company that connects uh brand and retailers to kind of convert content from brands to retailer needs okay so if if a if a brand i mean let's use mars bars for example they have a picture of one of their candy bars and they have four pictures of it photographed from different angles and they have certain metadata you're essentially taking the metadata from that the mars website when they sell that to target and target listed on their website you're helping that metadata flow correctly exactly man that's exactly it interesting why is this difficult and we we kind of refer to it as the forgotten problem of e-commerce like no one wants to think about this stuff because it's it's really boring and sexy but it's such an important you know um part of of e-commerce because you know without without go to getting the right content of retailers it you know there's you're not able to sell these products and the difficult thing is that walmart versus amazon versus you know macy's all those different researchers you have in the us or you have on a global scale i mean same goes for in in china with alibaba and jet or jd they're all having different systems that that and brands need to work with and all those systems have different requirements so you can imagine it's it's very similar to how um the banking system works if you want to pay someone in nigeria for example there's actually a process that we don't know about as consumers that happens to convert um you know your your money in the u.s to the to to like the banking system in africa or in nigeria yep so who peter sorry i'm going to cut you off but i want to make sure i get your full story here so who's paying for this the the mars bar production company that mars or target the retailer no a great question so it's the brands it's the brands because at the end they're getting retailers in most product categories are still you know they still have the upper hand so they're the dominant the dominant party and they basically tell the brands listen we need your content give it to us like this and you deal with it so the brands are most most of the time they're just like filling in these excels and there's a lot of manual work happening so we're taking that inefficiency away from jane and totally automating everything creating as we call it an end-to-end flow so from the brand all the way to the retailer with total transparency internally you know what content goes to which retailer and this just sets brands up to to really dominate in e-commerce yeah i know i think the product is crystal clear i think my audience will totally understand what you're doing there's a big there's a big need for it and it's unsexy so i totally get that help me understand some of the economics around it right so so brands how how do you price are you pure place ass um it's uh it's difficult because unfortunately there's still a lot of custom work from our end required so we have a we we kind of have a service model uh combined with a licensing fee so pure play sas for for the platform and based on the number of retailer channels you connect so imagine in the us as a mars bar you know you want to sell to let's say 20 different retailers we actually price on based on the number of channels that you connect to each product okay and what are people ignore the consulting stuff for a second if we just look at the pure play sas you know on average what are these brands paying per month or per year for this um it's about a thousand bucks per retailer per uh per year okay and that gets them access into wait hold on for retailer for the brand for retail for a brand they pay about a thousand bucks to push the one we did for a year yeah yeah so sorry the reason i asked the question the way i did is because i don't know how many retailers one of your customers pushes to on average so on average what how much is a brand paying per year on on average uh a brand pays about uh 20k a year okay so on average they're connecting to about 20 retailers per year yeah okay interesting um does anyone do do you um is there any other variable pricing that allows you to drive expansion revenue besides getting them to connect to more retailers yeah well anyway it's it's markets but in a sense that's also retailers so we also price per market so if you're in the us and you're in canada um we actually there's two different you have to pay for for for the us and canada but clearly at the end you can you can you know distill it down to the number of retailers because in the end it's going to be 20 retailers in the us 20 retailers in in canada so we're the same as having 40 retailers in the us um but why i mean basically a mars bar has different content in the u.s and in canada yeah you know it's really strange but it's these are these these little details that again we don't want to worry about but um the the recipe of a mars bar can be very different in canada versus the us so yeah yeah americans want more sugar canadians are more health conscious there's less shorter yeah it needs to be bigger right the mars bars yours are twice the size all right and and put this on a timeline for us peter when did you launch the company what year uh i launched it well i pivoted twice so uh we we kind of did we started this in 2013. and when did the sas launch well three years ago we got we got you know companies paying 2016. yeah 2016 we had our first customers paying and how long were you like developing the product before that well two years and before that we had another two and a half years developing something different which was the basis of our new product it's very much an advertising model i won't go go into the details okay we use that to kind of to kind of take this to another level and we've had to you know we've had a chicken and the egg problem so a brand would come up to us and say which retailers you have connected and a retailer would come up to us and say which brands you have connected and you know you're working with some of these you know companies are the biggest companies in the world we've got unilever as a client of us and you know walmart is a partner of us so peter what actually fill out that marketplace for us right so today what are you at on both sides how many retailers how many brands well we have four thousand over four thousand brands those are they're all paying you right no no oh there's a free model yeah there's a free model as well what's the free model so the free model is on the other side when we we work with certain retailers retailers can invite their brands to get free access to sydney let's see with with that brand skin so really what we are all about is is we're playing the platform game and i think that's really where we've done some exceptional things like the you know product led growth that's really where our strength lies like creating a network effect and the the virality yeah peter hold on i want to push you i think i get this maybe you call me if i'm wrong but i want to push this for our audience here the way you solve the chicken and egg problem is you gave for and you needed retailers who don't pay you the brands you but the way that you got retailers you said hey walmart sign up for sydney and we'll give all your a thousand you know brands access to sydney for free making your metadata and updating your website easier right and then that walmart account let you then go try and close more paid brand accounts is that right that's the model exactly interesting it took a while to figure it out and we've tried both sides but exactly the way you're explaining it right now is how it works and how many retailers now um well not too many like five five yeah yeah yeah so so let me ask you a different question if if you sign up a walmart that and they they work with loads of brands let's say they sign up 5 000 brands for free right i'm making that up doesn't that cut out a massive chunk in the market that you can then never make money from no because what what the brand gets is a perfect city like just the perfect environment but it's just streamlined to uh to give them access to that one retailer now clearly if they see the value for us the upsell isn't saying hey guys you can now do this for amazon you can do it for all your 20 other retailers that's where we make the money i see okay so today how many paid retailers on the platform how many customers you have well we've got we've got five retailers so big big retailers that are inviting their their brands but it's really not where we focus on we have um over well just like 100 plus brands that are paying us okay that's great so a hundred brands paying about 20 000 bucks a year you told me earlier that would put you right now you're doing about 160 000 a month in revenue yeah something like that yeah okay and then take me back a year ago what were you doing so we can calculate growth um about half i would say okay so that would mean back in january of 2018 you were doing maybe 80 000 bucks a month something like that yeah where did most that growth come from was it upselling retailers to going from five sorry upselling brands from five retailers to 20 or adding brand new brands altogether it's been on the brand we've just been focusing on the brands so no my point is though have you driven most the revenue growth from expansion on old accounts or adding new logos all together no it's it's very much uh upselling our free uh brands to uh paid brands yeah yeah because what we've done we've actually solved the chicken and the egg problem which is which might be interesting to anyone working on a platform and looking at virality now or trying to figure out the you know solve the platform problem the chicken and the egg we've looked at how to create standalone value for our users without having the other party on on the on the platform so we've looked at the brands where you know there's so many more brands in in the market than retailers and the program for brands is a lot greater as well so that's really where we focus why we focus on brands and we said okay how can we create standalone value for these brands so what we created was this export tool which is very similar to we transfer which allowed brands without us working with the retailer to still send the right content to amazon for example because on the back end amazon sent the right the the the excel templates to their brand saying hey coca-cola can you fill this up please coca-cola would then send that to my customer success team we would then integrate it into cindy and they could fit it up and then send it through sydney to um um we've been able to create standalone values so we could start like for example we started it with a very large consumer goods company in china uh within a couple months we were like set up we're serving all their retailers with content all in chinese without having one retailer as a partner and that was quite so that's why we've been focusing so much on brands and and will continue makes good sense hey we're running short here on time but i want to get through a bunch of other questions here so we'll try and do these quickly um talk to me about funding have you stayed boots dropped or raised we raised how much uh a couple million here so uh so what three million over three million yeah okay three million bucks raised and then um how many on the team well right now we're 20. okay and um where's everyone based on amsterdam oh god no actually amsterdam we've got one guy in brazil one guy in paris and one guy in ukraine they're all developers so we're trying to grow our remote team churn is really really critical what's your turn today um it's it's basically nothing okay so uh we yeah now now is that because so let's break that down um do you have any meaning it sounds like a meaningful expansion revenue because you'll take a brand from connecting to one retailer up to 20. is that covering up any any lost revenues so that your net sharing is zero no i mean we're just not losing clients okay but even ignore losing client if even if you still have a client but they go from paying a hundred grand a month to down to a grand a month they're still ninety-nine thousand dollars in revenue churn there so do you have do you have any downgrades no no there's been no downgrades across all your hundred customers over the past year yeah okay just i mean so we basically you know honestly we've lost in the last two years we've lost five clients okay i mean so by the way that's not zero right that's about two point five percent uh two point five percent turn per year oh uh yeah you're right so it's two point five percent um so are you too cheap i mean that's pretty low churn yeah maybe yeah okay well if you change if you if you increase your price point i get ten percent of all the new expansion revenue right the thing is yeah for sure we can talk about that later on and i'm kidding i'm fine the thing is we we have quite a and we've got a new product so we've had to invent this product it didn't exist before we we started building it so we've been raising our prices in line with the the developments that we've been introducing so we've been heavily investing in a platform uh we've actually been entering into some other spaces uh that that existed like the product information management space in the digital asset management space which are existing you know billion dollar markets um and we will continue to raise prices because we're driving more value for these clients um but yeah it's a very fair point walk me through peter walk me through your fully weighted customer acquisition cost so to get a new kind of retailer on board fully weighted what are you paying to get them well um yeah i know in all honesty nate and we we haven't really looked at that properly so we are you know in that sense we're we are looking at driving this sas company but um the acquisition cost would probably be around you know five four or five thousand yeah well that's by the way that's fine if the retailer if the retailer brand's gonna pay then 20 grand in first year you're getting paid back what's four or five months yeah well what i didn't mention is that retailers also pay us so when it's free for the when it's free for the brands the retailer pays so the retailer pays uh a price per product so if they have an assortment of let's say 30 000 products they pay just under a dollar uh per per year i thought you said you gave it free to walmart because that's how you got brands on for free no no no no so sorry i didn't i didn't explain it well so the retailers pay pay us we set up their accounts and it's free for the brands if the brands pay us then it's free for the retailer so whenever there's one party paying it's free for the other side just to keep just to keep the barriers as low as possible yep that makes good sense now talk to me in terms of runway and growth are you profitable or break even today are you burning capital oh we're profitable oh pro okay that's great profitable um when did you let when would you but when did you raise the last round well we actually sold the business uh last year oh to who uh to uh one of our biggest competitors so are you like about to quit because your earn out's almost up uh of course not i'm really happy building the business it's just a different game no i'm uh i'm still i'm still uh fully committed and uh we're still building the business it's it's actually a really exciting new you know new time you're talking about by the way you're talking about ice cat right i'm doing about ice cream yeah ice cad acquired you guys back a year ago what was the sale price that's i can't say oh they didn't publish it uh well no but it's uh yeah they didn't publish it what's it rumored to be i'm sure people speculated it's a it was okay i mean it was a good it was a it was a good deal and what does that mean i mean good is relative can you kind of quantify it somehow without obviously revealing something you can't um well it's it's uh it was you know was it north or south of 10 million it's uh it's it's kind of well it's south okay so let's see did you at least did you at least get your investors money back was it more than three million yeah we did we did we did so then cindy i can kind of pin you down here i won't push further but you sold somewhere between three and 10 million bucks yeah exactly okay fair enough very good all right let's wrap up with the famous five number one what's your favorite business book jesus um i would say um favorite favorite business book um uh don't make one up if you don't have one it's fine i've read too many uh tipping point okay number two is there a ceo you're following or studying well richard branson is a big favorite number three how many uh what's your favorite online tool oh wordpress okay number four how many hours of sleep to get every night well i got two kids so really they're until six okay and situation are you married with two kids or single mary there's the ring married two kiddos and how old are you 37 37 last question peter what do you wish your 20 year old self knew my 20 year old shelf go to the us guys go to the us get to the us as fast as you can and build your business there he's having some success though building sydney and basically helps brands get their metadata into retailers websites more efficiently and more effectively whether it's based off languages locations or different sizes for different markets he makes it efficient they've got over 100 brands paying them call it 20 000 bucks a year in terms of average acv doing about 160 grand a month right now in revenue up from 80 grand a month just a year ago um they're profitable three million bucks raised they sold last year to their competitor called icecat for somewhere between three and 10 million bucks team of 20 in the netherlands as they look to continue to scale peter thanks for taking us to the top