How Tapfiliate CEO Thomas Van grew Tapfiliate to $960K revenue and 1K customers in 2018.

hello everyone my guest today is thomas van der kley he's the founder of tap affiliate a company that builds world-class tools for tracking managing and growing affiliate programs and referral programs in previous lives he's created an ad supported free printing service for students in a social network for startups he loves ad tech vinyl records and needless to say cats thomas are you ready to take us to the top yeah definitely let's go all right tap affiliate tell us about the company what do you guys do and is your model revenue model pure sas yeah so we build affiliate tracking software uh we help affiliates uh e-commerce businesses and other uh sas businesses to set up affiliate programs so we sort of like google analytics for affiliate marketing and yes we're 100 sas that's great so so on average kind of what what does a customer pay you per month would you say uh that's about 80 oh 80. okay so so fairly hopefully this is like high volume then right at that price point um what kinds of customers are you signing up typically uh everything we have from well there's a lot of eco e-commerce we got like food supplements fashion travel like everything that is being blogged about basically uh so that's that's one end but we also have you know porn uh everything is in there basically crypto interesting you said porn crypto smbs all of it yeah yeah i actually have one of them sorry god i would say uh what this is kind of interesting what can we learn what can sas ceos learn about their affiliate programs from how effective you see the porn company running theirs well to be honest we we don't meddle a lot with uh with our customers we have no touch models so we don't really go into um into like individual clients we just you know we do our questionnaires and we do our you know interviews but we don't i i don't have any specific insights to share about about specific businesses okay when did you launch the company what year uh it was 2013. okay 14 14 14. and um and what have you scaled to today in terms of total customers on the platform uh we're a little over a thousand okay a little over a thousand so that's i mean that's pretty healthy growth i mean i can take thousand times 80 right you're doing about a million bucks a year right now that's it that's good what's growth where were you at about a year ago well we used to do uh 100 year-over-year um but we launched a new website in february of this year and that completely completely killed our conversion rates uh and it took us quite a while to sort of like find out what was going on we got a lot of things we liked about the new website because we like we realigned our mission and vision we're looking for a different kind of customer um but it took a little while to find out what was actually you know holding back customers from signing up uh and we actually just you know we got back on track about about a month ago so we're now like starting starting to pump again so you're about 80 80 grand per month today where were you a year ago were you flat basically no a year ago it was rather like i think it's like 60. okay so still some growth there just not a hundred percent exactly yeah that's good and then um have you funded the company are you bootstrapped bootstrap i love that congratulations that's great thank you very much uh how many other founders are there um it's basically just me and uh i have one partner but he's more of the old wise wise man thank you thank you he's a wise man strategic advisor is a minority shareholder who might just wanted to have on board just to to be with me that's great how many people are on the team today uh we're five oh five people gosh i love stories like this like small nimble bootstrap thousand customers um walk me through customer acquisition what are you paying to acquire customers uh so we pay if we only look at adwords which is fully weighted include any sales people or customer success or onboarding uh so i think that's about for a trial customer it's about 20 to 30 dollars and we have a child's paying ratio 40 okay so said otherwise you need a hundred trials for 40 you need two trials basically for one new customer so you're spending 17. yeah yeah so you're spending like about a hundred bucks to acquire a new paying customer some logo that's that's pretty good if they're paying 80 bucks a month your payback's about you know a month two months yeah exactly healthy um so you know here's the other question right i mean if you found growth channels why not why not go get some additional capital and and you know drive growth uh there are multiple answers to that question um for one this company was founded from multiple angles one was because i had some experience with affiliate marketing from both sides as an affiliate and as an advertiser and i didn't really like how everything was set up so i set out to change that the thing is that i had a different companies before and part of this setting up this company was modeled around the things that i didn't like before uh my first company had a very bad experience with an investor or with multiple investors actually how about like when they forced you out or what happened no they were just it they ended up not really understanding the business uh and they were putting a lot of pressure on us and making us do the wrong things um and in the end i wanted to you know it really depends also on how you define success right so for some people hyper growth success for me in this company is much more uh it's a much more holistic thing so i you know i'm for for when i'm very very picky about whom i work with uh like extremely picky because you know like working is my hobby so i if i want to go to the office i wanted to be i wanted to be like amazing there i want really nice people uh thomas what what actually happened like specifically what happened did they like do something behind your back or like what what happened nah it worked we were several it's it's such a long story that it's hard to sort of compress that into into like into into a couple of sentences but basically there were multiple investors on board one was a big company who was sort of i think you'd say spotting us working capital by giving us our products for free then we had financial investors on board and they were basically playing games together uh and we were just young guys we were like 21 22 didn't know what was going on you know didn't know anything about business and they were sort of like big forces fighting each other and we were sort of like the ball being kicked around at that point so interesting it's it's i can't put it you know how much how how large that company in terms of ar that company no we we sold ads so that was not that was not recurring revenue that's also one of the reasons why i started sas business because back then we had quite large customers we're nice customers we had like dell and how big was the company i'm just curious and like your best 12 months how many how many revenues we did like we did like uh 400k in yearly revenue okay okay well you made a smartness you made a smart decision yeah yeah by the way the new website's gorgeous it's so funny when you look at websites that are gorgeous many times they convert way worse than the ugliest websites you've ever seen exactly it's the ebay the ebay uh the ebay thing craigslist right oh craigslist yeah yeah there you go um well this is great okay so i love this five people bootstrapped doing your own thing having a lot of fun where's the team based uh we're in lovely amsterdam everyone's in amsterdam everyone is in amsterdam yeah i'm uh i'm a bit of a uh i'm a bit old school in that sense i like everybody being together in an office and it also has to do with what is before you know for me like going to work is has to be as much fun as you know my free time so yeah i like to be around people so i want to be around the people i work with yeah churn what's your churn today yeah so logo churn uh is about seven percent which is quite high per month um yeah per month um but it could be way lower uh if we you know if we took a different approach in the sense of you know getting more people on faster because like for for a long time it was only like three people the company so there's only so much you can do so the revelation what's the revenue churn the revenue churn is a little bit lower is around five percent uh but that's because you know we've been on our current price points for quite a while so we don't have a lot of you know we started out at 29 now the lowest price plan is 69 but we we still have some of those guys around but we don't have a lot of those food shows yeah that's interesting um i'm going to guess you don't have a ton of expansion revenue because the delta between your cheapest and most expensive isn't in the thousands i mean do you have meaningful expansion or no no that's right we just have a little bit we but we don't really push for it at this moment it's one of those things that you know we need to get done but uh we're a small team and there's only so much you can get done in a week yeah it's interesting i mean when i look at your pricing no matter what the price point is there's zero transaction fees um that's right you add on in your pro...