How Trainual CEO Chris Ronzio grew Trainual to $32.6M revenue and 8K customers in 2024.

you're gonna love this interview just got done editing it i'm glad i got it live for you i'll be in the comments for the next 30 minutes hanging out answering any questions you have in fact leave a comment below about data points or what you think is going to happen to the company and i will respond to every comment additionally if you're just loving the content click the thumbs up and i will go and check out your profile as well and give your videos some love as well in the meantime enjoy the interview hello everyone my guest today is chris ranzio he's the founder and ceo of tranual a sas platform for entrepreneurs and employees to get their business out of their brain by documenting and delegating the processes in their company chris you're ready to take us to the top yeah let's do it so i thought about you earlier this week because we put out a big piece on git lab and we had sid on the show and one of the things that he credits to so much of his success for scaling his remote team is his employee handbook 700 pages worth of stuff this is this kind of what you're helping companies do document this stuff yeah policies processes procedures best practices like all everything that the company knows collectively we want to put that in one place so you can access it as you scale and so for people that missed your first episode give us the quick update here when did you launch the company what year january 2018. so it's been almost two years 2018 that's great now boots dropped or raised bootstrapped even today totally bootstrapped so we did a convertible note round just after my last episode last year so december 2018 we bootstrapped the whole first year and then this year the convertible notes have uh grown us to this point okay how much did you raise on convertible notes hey chris how about 50 750. oh 750. okay do you looking back i mean did you need that capital or was it more like a cushion a fluffy thing we did if we wanted to keep scaling our advertising so that it had you know scaling our ads on my credit cards it got us to where we were and we wanted to keep it going so i mean how aggressive are you being like last month you're talking like 30 grand a month spent on ads no last month we were probably 120 000 oh wow okay so is this your main growth channel it has been to date but it's starting to flip where we're getting more of our signups from organic now just based on how much content and marketing we've done okay so let's dive into that so you launch in 2018 um people are buying who is buying this typically is it head of hr it could be hr it could be operations could be sales managers so it's anyone with a team that they want to train or get up to speed faster people use us for onboarding their new employees and then for just keeping everybody consistently up to speed on the newest stuff okay and so what are they paying on average per month for this or per year on average they're a little over a hundred dollars a month okay so are you like a 1300 a year are you upselling against like number of seats or feature based upselling how do you upsell we have two packages that are split based on features so the premium one has like built-in screen recording and and animation giffy and stuff like that um the base plan just doesn't have that but then it's based on 25 user increments of seats 25 user increments of seats so it's essentially staged buckets basically yeah so the big utility of our app is it's tracking everyone individually being trained up to speed up to date and so we didn't want to sell per license per user and have people share logins and kind of game the system so 25 user buckets kind of match with the stage of a company yeah yeah very interesting now you have really invested in your seo game since the last time you came on so according to ahrefs you've added almost 400 referring domains over to 2 300 backlinks over the past 12 months how are you doing that is it internal or do you hire an agency or what no we do all of our marketing internal so it's been just a lot of outbound pr efforts we've started doing a lot of content on our website guest posts we've sponsored events we've sponsored podcasts so we've gotten a lot of traffic from those things okay interesting so what is the team size today and what's the title of the person managing kind of the backlink the seo growth so team size 24 today and my brother actually is our cmo and he's still managing all the the marketing content oh very cool okay who owns more the company you were him me oh nice how are you older too i am going to come along for the ride yeah i love that all right so 24 folks full time how many engineers uh six six okay any quota carrying sales reps at this price point or is it too low for field sealed sales no we've got two sales reps but they're 100 inbound so it's more about just talking to customers that need extra help interesting okay so ad spend scaling like a lot of people have this thing where if i just raise i can just spend 100 grand a month and it'll work you're actually are now spending that much per month but imagine it wasn't just a flick of a switch right talk to me about some of the learning curves on that yeah so the ramp went up pretty consistently when i was on here last year i think we were spending 30 or 40 000 a month and we went up to 50 and then 55 and then 60 and as we were doing it we're constantly measuring our acquisition cost how many signups per week we have and then making sure that a huge swath of those customers aren't canceling as soon as they get in the app um because that's the challenge that we saw last fall we brought in a huge wave where we like doubled our customer account in a month and then we saw our churn spike because we got a lot of bad customers so we were a little more careful about how we ramped up but it's just been swapping out better creative and saying what messaging resonates with the customers that are staying the longest and what case studies do we have from you know we've got 200 customers doing this particular thing let's make a case study out of it and target our marketing a little more so it's just gotten a little more sophisticated i'd say in the last year and so how many customers are you now working with today uh we're just over 2500 now okay that's the end this year yeah i mean you're at 600 last time you came on the show right it's been a big year yeah it's great i mean congratulations so 2500 at 100 bucks a month i mean that's 250 grand a month in nmr is that about right yeah that's it we hit that last month that's great and that's all i mean that's up from again about 60 000 exactly a year ago right it's almost three well no four or five x year over year growth yeah so we should end this year at the about 3.5 arr yeah that's i mean this is this is like the kind of story you love hearing now let me ask you a question would you ever get to the point and kind of pull a pull a zapier where you essentially actually pay back that convertible note instead of converting and doing an equity round no so we had an interesting trigger in our convertible note where once we hit a certain revenue threshold the ability for me to pay back went away so it was investor friendly but but i was good with it because i didn't want to be in a position where we're spending all the investor money and then i don't have the money to pay them back if they demand it so it was it was kind of like they took a flyer and and they get the reward for that that's interesting so it sounded something like we'll give you 750 at like a six percent interest rate and like a 20 discount but once you hit like i'm making this up 2 million bucks in arr we get 10 of the company yeah it was like that so interesting yeah so so it's kind of creative but so is everything we do i guess why did you choose to use convertible notes instead of actual just regular debt so at the time we didn't really have many options for regular debt so i was looking at you know the revenue based lending and what i could get from them as a multiple of our trailing 90 days mrr and and uh the convertible debt i could get a lot more of so and for and it was also a few close uh contacts so it was kind of like these had been advisors that helped on the business and they wanted to come in and be a part of it yeah would you consider if you wanted to raise more so to avoid equity would you consider going on raising debt today traditional debt yeah absolutely i think uh i think yeah that's a great view if you've got a marketing vehicle that's working like we do i think that's a absolutely a good option what would be enough where it's worthwhile to actually take it like is 500 grand you know three four months of ads been meaningful to you or would you try and raise more uh i'd have to be more i would say interesting because what yeah because it depends on the debt structure you know if you're only taking a few months of of ad spend then a few months you blow through it and now you've got some multiple of that debt or at least some fraction of the debt that you've got to pay back and you're servicing debt it...