How Tapchief CEO Shashank Murali grew to $149.4K revenue and 75 customers in 2019.

hello everyone my guest today is shashank murali he is running a company called tap chief which is a marketplace for freelancers to engage with businesses shashank you're ready to take us to the top yeah absolutely all right so what do you mean when you say uh a marketplace for freelancers to engage with businesses what kind of businesses what kind of freelancers uh well today we are largely focused on tech content content and design freelancers on our platform today we have nearly about 100 000 professionals on on our platform uh in terms of businesses we largely work with various startups a couple of fortune 500s like unilever uh various indian startups at this point in time uh at high growth companies uh who are effectively trying to find talent uh in order to either uh fill in a skill gap or to augment their existing teams with additional resources when hiring is taking too long or they're not able to hire full time and so on and so forth okay but are you i mean is this like top tile would be like this for like for like developer talent other people focus on marketing talent etc those are like content writers like scripted or contently are you are you sourcing a specific kind of freelancer uh we have quite a few kinds right so we are more of a horizontal platform we're not a verticalized uh for a particular skill per se uh but our top categories today are as i said technology design content marketing okay and how many freelancers have you paid at least a dollar over the past year uh about 2 000 of them okay and how many total are on the platform today we have about 85 000. okay okay so i mean how do you move those 83 000 that are not active to actually make their first dollar revenue on your platform yeah through a variety of means right i think uh what we have understood is super crucial is it's important for every freelancer to present themselves really well in front of the business and in general as a whole on the internet right so uh educating them about what kind of portfolio suits them or how do they showcase their work previous work client references uh the kind of businesses they have worked with in the past etc all of these add to uh a freelancer becoming more easily accessible for a business to kind of want to work with that so i think uh education is a large part of that process in order to convey to each freelancer on the platform as to how how can they stand out how to how can they create a personal brand of socks on our platform interesting okay so 2000 have learned at least a dollar how much total have you paid out to freelancers over the past 12 months uh over the past 12 months we've paid nearly a million dollars uh to freelancers on our platform okay and i mean is that a meaningful amount or i mean that sounds fairly small to me to have a healthy marketplace oh well again uh from so since we have largely focused in india uh where you know 80 or 90 of our workforce earns less than 150 dollars a month today in india right uh so from that perspective for an indian audience it's significant figures uh however of course it's still early days for us and there's lots to do uh in fact in this uh financial year where in india it's april to 8th march uh the last four months itself we've driven about 500k so it's it's kicking and the engines are roaring as we speak but when did you launch the company what year so we launched the company in 2016 as a career as an advice platform we pivoted to what we're doing today around early 2018 so it's so in the new avatar i think it's been roughly about 18 months for us when did you get your first dollar revenue a year we've been making revenue from day one even when we had the old uh model uh but of course we have grown much quicker and much faster in last year do you remember how much you spent on the mvp before you had your first dollar revenue i think less than five thousand dollars okay that's pretty good now have you bootstrapped the company or did you raise capital we bootstrapped the company for the first eight months then we've raised over two million dollars now across three rounds okay at all equity yeah in all equity okay now are you are you i'm curious how you make money here is there a is it a sas platform or are you taking a cut of fees a gmv model almost it's it's a gmv model we take a fee of every dollar earned on the platform okay about how much so our take rates depends on the kind of ticket size and the kind of engagement so we have gigs ranging from 16 minutes all the way up to six months uh so our take rates range from anywhere between five to twenty percent so twenty percent is something uh for a quick consultation call which is of 60 minutes or so uh the lowest range is usually on a much longer project size and ticket size so okay well if you if you combine all the money that you've kind of put with the platform what is a fair weighted average take is it like 10 something in the middle yeah it's closer to about 15 today uh yeah so over the past 12 months you've paid out about a million dollars if you have a 15 weighted kind of average weighted take rate that means you'd about 150 grand in total revenue for you over the past 12 months is that accurate yeah that's right and what did you do for the prior 12 months before that so we can calculate a growth rate um prior to that we would have done about 200k in total volume yeah okay so the take rate on that is like what is that like uh 30 grand yeah yeah so we wrote about 5x 5 to 6x overall and what's driven most that growth is it is it you know the same freelancers earning more or is it adding new freelancers all together it's a combination of both some of our top notch freelancers have more or less quit full-time jobs and have completely shifted to this lifestyle which is what the mission of the company is as well in order to catalyze independent work and remote work uh and enabling more and more professionals to become solopreneurs and work for themselves because we believe that there's a new class of professionals who neither want to start a company nor work for a company right they want to work for themselves and i think that's the lifestyle that we are enabling across india at least at this point in time and hopefully across the globe in the next couple of years yeah now who do you consider your customers the 2000 freelancers who you've paid something or the people listing their projects uh yeah so today our freelancers is what the supply side the demand is from the businesses that exist on our platform how many of those have spent at least a dollar through the platform um that that's about uh 75 businesses today who spend more than a dollar yeah okay and that's over the past 12 months yep okay so and what's the average project size um depends so about 20 if it's a remote project it could go uh anywhere between uh you know thousand dollars to fifteen hundred dollars uh anything on site can go much higher so uh and retainer ships uh over a six month period and so on is you know fifteen hundred or two thousand dollars into six so roughly about ten thousand to fifteen thousand dollars yep so yeah okay that sounds about right i mean if you put a million out over the past 12 months across 75 projects that's 75 companies that's about 13 grand uh per company over the past 12 months yeah of course some of them are more have obviously spent way more than others but uh because they've been customers for much longer but yeah you know that that's fair comment to make yeah and then again you're taking 15 percent on average so the average customer you're essentially i mean you know basically making almost 2 grand right per 15 13 grand they put through you yeah interesting super interesting um okay let's um let's talk about churn right how do you measure churn in in your you know in a marketplace uh so we measure churn on both sides uh so from a demand side it's what we qualify as an active business is somebody who's contributing to revenue every quarter uh because most uh budgets at a business level are made at a quarterly level in terms of outsourcing or spends on people and so on so forth uh at a pro freelancers or professionals level what we do is we kind of look at churn uh on you know when after doing a particular gig you know how long did it take for them to come back to do another gig right uh so if that so we have today uh so if somebody is primarily someone who does only micro gigs which is which effectively which takes less than a day on our platform uh you know if they are not doing a gig for a week in some sense we consider them churned for that month uh but folks who are doing much longer term gigs then we look at a monthly level and quarterly level as well got it what's your team size today how many people today we are 40 4-0 yeah how many engineers uh 15. do you have any quota carrying sales reps uh yes we do have about four of them interesting and are they in charge of the supply side sales or demand side sales demand side tubes and so the supply you've just you've taken care of there's enough inbound there supply is a lot more organic uh especially in an emerging market like india a lot more people want to make money a lot more people are looking for opportunities so you know they're discovering you trying to discover this online all the time so it's been a little more easier but of course you know uh from a demand perspective it's important to uh deliver that trust in the brand and the freelancers on the platform and so on so forth which requires some human touch points today because in emerging markets like india again freelancing and independent work is still a concept which is still taking off right it's not mainstream yet unlike the west so yeah so that's where we have sales what does it cost you to onboard a new business that's going to put 15 000 of project volume through you over a year uh today for us uh again from even businesses it's mostly inside sales effort and not so much feed on street uh when a business comes expresses intent on the platform saying you know what i'm looking for a data scientist or i'm looking for a ui ux designer right and then there's inside sales efforts to convert that into a live project on the platform uh with a profession freelancer matched and kicked off uh so ha to trade that cost let's say any sales rep is able to onboard anywhere between uh four to five new customers a month now so we set up the whole sales team and everything very very recently about a quarter or a quarter and a half ago so it's still early days and we're you know uh figuring sorry so so but if you had to quantify your fully weighted cat so include the inside sales person commission you know divide their base by the four customers are adding as well you know add in any seo content writers for the inbound leads what's your fully weighted cac to get a fifteen thousand dollar your customer uh that would be maybe close to about a thousand dollars at least okay so if you're taking 15 of their total spend through the platform i mean that puts you at something like uh eight month payback period yeah does that feel right yeah that's right that's interesting when was the last round of funding um it was uh we announced around this june uh where we raised 650k from various set of investors uh final startups angelless syndicate a couple of uh our existing investors also participated we had a few prominent marquee entrepreneurs so literally just like like two months ago you basically raised 650 grand that's right so you're you hired some sales people you're growing burn a little bit today what's burned today we talking like 100 grand a month or 50 grand a month or what yeah it's more like 70 grand 75 grand a month right okay can you sleep at night without burn yeah i think we have a reasonable level and revenues are growing so we should and we should be good yeah we should be good good all right let's wrap up with the famous five number one what's your favorite business book uh right now i'm reading blitz scaling so i'm really enjoying that number two is there a ceo you're following or studying yeah i think numerous of them uh uh one is uh one of my investors vijay of ptm who runs india's largest payments company which one uh it's vijay of paytm yeah what's the company name pay as a pay tm uh it's one of india's largest payments company unicorn and so on uh we followed them also follow uh what uh you know zoom is doing quite a bit uh what uh stewart is doing with slack so yeah all of these guys have been like role models in different aspects number three what's your favorite online tool for building your company slack number four how many hours of sleep to get every night uh five and a half to six okay and uh what's your situation married single kids all right how old are you 26 26 last question what do you wish your 20 year old self knew um building products is addictive get started asap all right guys there you have it tap chief if you want to scale with indian freelancers again good cost to capital there for relatively strong talent and tech designing content use tap chief again they just passed uh they've raised two million dollars burning 75 grand a month they're doing about call it uh about 130 000 in terms of run rate right now 75 businesses have put on average fifteen thousand dollars of project value through their platform of which tap chief takes about fifteen percent of so call it about a hundred to two hundred dollars per month or two thousand dollars per year they make for these uh these projects through the system about 2 000 freelancers have made at least a dollar via the platform over the past 12 months that's about a million dollars paid out so 500 bucks per 2000 of the active freelancers on average over 85 000 freelancers have signed up for the platform so healthy marketplace dynamics shashank thanks for taking us to the top cheers thanks a lot for having me