Founder Interview
How Trend Reached 20 Customers and $25K MRR Five Months After It Started Charging (Interview with Ramon Berrios)
- Interview Date
- December 12, 2018
- Interviewee
- Ramon BerriosFounder
Company Metrics at Interview Time
Customers (2018)
20
MRR (2018)
$25,000
Team Size (2018)
5
Influencers on Network (2018)
1,600
Historical Snapshot
These numbers were reported by Ramon Berrios during the interview recorded in December 2018 and are a historical snapshot, not current figures. See Trend’s current numbers.
Key Takeaways
- 01Trend had 20 paying customers at the time of the interview, five months after launching its paid model
- 02Monthly recurring revenue was approximately $25,000 at the time of the interview
- 03Pricing was still being tested and ran from $1,000 to $2,500 per month per brand; $2,000 a month covered up to 20 influencers
- 04The company raised a $250,000 note from friends and family about a year before the interview and, at the time of the interview, had about $500,000 in notes
- 05Team of five people, all based in Austin, Texas
- 06About 1,600 influencers were active on the network, with roughly 300 having earned at least one payment
- 07Trend operated as an invite-only marketplace where influencers received free product plus a flat $25 cash fee, or $100 for VIP influencers
- 08Notable brand clients included Lyft, Four Sigmatic, and Health Warrior
Company Metrics at Time of Interview
| Metric | Value | Source |
|---|---|---|
| Customers (2018) | 20 | Founder interview, Dec 2018 |
| MRR (2018) | $25,000 | Founder interview, Dec 2018 |
| Pricing Range (2018) | $1,000 to $2,500 per month | Founder interview, Dec 2018 |
| Plan Price (2018) | $2,000 per month (up to 20 influencers) | Founder interview, Dec 2018 |
| Influencers on Network (2018) | 1,600 | Founder interview, Dec 2018 |
| Influencers Paid at Least Once (2018) | 300 | Founder interview, Dec 2018 |
| Campaigns Created (2018) | 3,000 | Founder interview, Dec 2018 |
| Influencer Cash Payment (Standard) (2018) | $25 flat fee per influencer | Founder interview, Dec 2018 |
| Influencer Cash Payment (VIP) (2018) | $100 per VIP influencer | Founder interview, Dec 2018 |
| Largest Influencer Following on Platform (2018) | 100,000 followers | Founder interview, Dec 2018 |
| Team Size (2018) | 5 | Founder interview, Dec 2018 |
| Friends and Family Note (2017) | $250,000 | Founder interview, Dec 2018 |
| Raised in Notes (as of 2018) | about $500,000 | Founder interview, Dec 2018 |
| Year Founded | 2017 | Founder interview, Dec 2018 |
Growth Breakdown
Revenue
Trend launched its paid model approximately five months before the interview and reached about $25,000 in monthly recurring revenue across 20 customers. Pricing was tested in a range of $1,000 to $2,500 per month, and $2,000 a month bought access to up to 20 influencers.
Customers
The company had about 20 paying brand clients at the time of the interview, and about 25 had paid it so far, among them Lyft, Four Sigmatic and Health Warrior. Ramon said 3,000 campaigns had been created on Trend, and its vetted network had about 1,600 active influencers, roughly 300 of whom had been paid at least once.
Team
Trend operated with a team of five people, all based in Austin, Texas. Roles covered brand management, influencer growth, influencer engagement, sales, and the founder himself. Development was handled by a remote agency called Iron Forge, with Ian Han as the developer on Trend's iOS app.
Funding
Trend raised a $250,000 note from friends and family about a year before the interview and, at the time of the interview, had about $500,000 in notes. Ramon described the business as operating near breakeven, with monthly spend of around $25,000 to $30,000 against $25,000 in MRR.
Growth Strategy
Invite-Only Influencer Network
Trend built its supply side by requiring all influencers to apply and be approved, ensuring content quality. This differentiated the platform from open databases and gave brands confidence in the output they would receive.
Free Product Plus Fixed SaaS Fee Model
Rather than letting influencers negotiate their own rates, Trend charged brands a fixed monthly SaaS fee and compensated influencers with free product and a flat cash payment. This removed pricing friction and made the cost predictable for brands.
User-Generated Content as Retention Hook
Ramon positioned the content created through campaigns as a durable asset brands could repurpose for paid advertising and other marketing collateral. This gave brands a reason to stay subscribed even between active influencer campaigns.
Two-Sided Marketplace Growth
The team was structured to grow both sides of the marketplace simultaneously, with dedicated roles for brand management and influencer growth. Trend had first been free for brands, to build up the marketplace and beat the chicken-and-egg problem; when upselling those free clients proved painful, it invited new clients in on paid plans instead.
Focus on Micro-Influencers
Ramon called Trend a micro-influencer platform: its most-followed influencers had around 100,000 followers, and some of its larger brand clients worked with influencers who had around 2,500 followers.
Best Quotes
“We noticed that when we were looking at all these other platforms, there were sort of like a database where you would search and find influencers. But tricky part is that that is not even a quarter of the whole process of getting to work with influencers.”
“We turned the table and built a marketplace where a brand creates a listing and we have a vetted network of influencers. So it's invite only, and everyone has to get approved. Everyone has to make world class content to be on Trend.”
“We've been selling for about five months now. And this month actually was our first two churn clients. So we've been months to months so far, we had 0% churn. And then this month we actually lost our first two clients.”
“We used to be free to build up the marketplace, beat the chicken and the egg problem, built a sustainable marketplace. We actually tried to upsell to those clients and that was such a pain. We just said, let's just invite new clients in and make it seem like this was always like this and it worked.”
“So we have around 1,600 influencers active on the network.”
“For $2,000 you get to work with up to 20 influencers.”
“Given that we are an invite only network, the quality of the content you get doesn't go anywhere. And you can actually use that content and repurpose it for your ad spend or for print advertising or whatever it is, any marketing collateral.”
“You don't need a college degree to be a somebody.”
What Happened Next
At the time of this December 2018 interview, Trend was five months into its paid model, serving 20 brand clients and generating approximately $25,000 in monthly recurring revenue with a team of five in Austin. Ramon described plans to hire a product-focused team member in January 2019 and to build a desktop version of the platform for brands. Visit the Trend company profile on GetLatka for additional context on where the company stood at this point in time.
View Trend’s current profile and metricsFull Transcript
Chapters
- 0:00Introduction and Background on Socially Rich
- 0:21What Happened to Socially Rich
- 1:15How Trend Was Founded
- 2:16Business Model and Early Churn
- 3:04Customers, Pricing and MRR
- 4:09Fundraising and Capital Efficiency
- 5:33Team Structure in Austin
- 7:16iOS App and Technology Stack
- 8:21Marketplace Scale: Influencers, Campaigns and Brand Clients
- 9:19Pricing Model and Influencer Payments
- 11:48Micro-Influencer Strategy and Churn Risk
- 12:51Retention Through User-Generated Content
- 13:44Famous Five Rapid-Fire Questions
Introduction and Background on Socially Rich
Nathan Latka
00:00Hello, everybody. My guest today is Ramon Berrios. He was born and raised in Puerto Rico, previous owner of Socially Rich, and then took up to $50,000 in MRR when he moved to Austin. Socially Rich got shut down by Facebook, then he built trend.io within that same year. That's what he's focused on now. Ramon, are you ready to take us to the top?
Ramon Berrios
00:00Let's do it.
Nathan Latka
00:00Alright. Yeah. So you are in a tough space building on the
What Happened to Socially Rich
Nathan Latka
00:21back of a whale like Facebook can be good and bad. It it ate your first business, it sound like. So what happened with Socially Rich? Did it just slowly lose all the revenue or just sell it off or what?
Ramon Berrios
00:31Yeah, we actually lost all the revenue. We figured there was a lot to do there with those clients. We had about 5,000 contact information of people that we serve free trials to and customers, 500 active subscriptions or so. So there was something to do there. But as the time being Socially Rich, I actually became an influencer myself. And I was able to work with agencies, small businesses and got to understand the space and notice the pain
01:01there was in acquiring content and working with influencers. So we knew there was some damage to do there. So we just decided to move on and focus on something else.
Nathan Latka
01:10Okay. So you basically kind of just shut it down. So how'd you get up with the idea with trend?
How Trend Was Founded
Ramon Berrios
01:15Yeah, so when working with influencers, we noticed that when we were looking at all these other platforms, there were sort of like a database where you would search and find influencers. But tricky part is that that is not even a quarter of the whole process of getting to work with influencers. Searching for them is only the beginning. And the biggest challenge when using these platforms is that it's kind of odd how the influencers get to propose
01:41whatever they want to get paid for a post. In this so new. So we just decided to build a platform where influencers would just get paid with free product. And there was no platform really that would work like this. So we turned the table and built a marketplace where a brand creates a listing and we have a vetted network of influencers. So it's invite only, and everyone has to get approved. Everyone has to make world class
02:06content to be on trend. So that's essentially how it works.
Nathan Latka
02:10Interesting. And is it a pure play SaaS model or is your churn so high? It's not really recurring revenue.
Business Model and Early Churn
Ramon Berrios
02:16So we've been selling for about five months now. And this month actually was our first two churn clients. So we've been months to months so far, we had 0% churn. And then this month we actually lost our first two clients.
Nathan Latka
02:30And how many clients total do So you
Ramon Berrios
02:32right now we have about 20.
Nathan Latka
02:3420. Okay. So two twenty, that's a 10% monthly churn, something like that. Yeah. Interesting.
02:39And you just launched the company right in 2017 last year?
Ramon Berrios
02:43Yeah, last year. We used to be free to build up the marketplace, beat the chicken and the egg problem, built a sustainable marketplace. We actually tried to upsell to those clients and that was such a pain. We just said, let's just invite new clients in and make it seem like this was always like this and it worked.
Customers, Pricing and MRR
Nathan Latka
03:04That's interesting. Okay, so marketplace model, 20 customers today. On average, what are customers paying you per month for this?
Ramon Berrios
03:10Anywhere from for so we've been testing pricing. We've only been doing the pricing model for five months. Anywhere from 1,000 to 2,500 a month.
Nathan Latka
03:17Okay. So you're doing north of $20,000 a month right now?
Ramon Berrios
03:20Yes.
Nathan Latka
03:21Okay. That's great. How far north? Like what are you actually doing per month?
Ramon Berrios
03:25So we are about 25 right now.
Nathan Latka
03:28Okay. That's great. So 25, $25,000 a month, again, across, you said 20 customers.
Ramon Berrios
03:32Yeah.
Nathan Latka
03:33So a little north of a grand a month, obviously there. And then a year ago, so we can calculate growth rate. You were, I imagine nothing, right?
Ramon Berrios
03:40No revenue.
03:41A year ago, it was nothing. About five months ago, we got our first client. So we've been over 40% month over month. And then our healthiest month was October to November where we grew 138%.
Nathan Latka
03:53That's fair. In all fairness, going from $5 to $50 is huge, huge, huge growth numbers percentage wise, but obviously you're getting...
Ramon Berrios
03:59Exactly.
Nathan Latka
03:59You're building though.
04:01You're building though. I love it. You got a lead. You can't bury the lead. It's a good growth number. Have you raised capital or are you bootstrapped?
Fundraising and Capital Efficiency
Ramon Berrios
04:09Yeah. So we did about a year ago, two fifty from friends and family. And, we have about 500 in notes.
Nathan Latka
04:19Okay. So about seven fifty raised to date. Was the two fifty from friends and family equity or was that a note as well?
Ramon Berrios
04:26It was a note.
Nathan Latka
04:27Okay, so two notes right now. That's great. And I imagine you're probably burning capital as you look to build or are you cash flow positive today?
Ramon Berrios
04:35So we are about break even. We are adding on and then we catch up to the burn fairly fast. I come from Socially Rich was a completely bootstrap business. So this is completely new to me on how to make the capital the most efficient. I mean, there's obviously a diminishing return. Wish to add more salespeople and all that, but we have to think more about product. So yeah, we're about breakeven right now.
Nathan Latka
05:05That's great. Now when you say about breakeven, I mean, close? Are you burning what, like a grand a month, $2,000 a month?
Ramon Berrios
05:09We're burning around 25 to 30 and we're in 25 MRR.
Nathan Latka
05:15Sorry, total spend is about $30,000 and monthly recurring revenue, you're making 25. So you're burning about up to in a bad month, $5,000 a month?
Ramon Berrios
05:15Yeah.
Nathan Latka
05:15I see. I see. Good. Yeah. I mean, that's obviously, you have plenty of runway if you have seven fifty raised. Yeah. That's great. What's the team size today?
Team Structure in Austin
Ramon Berrios
05:33So about five.
Nathan Latka
05:34Five people. All in Austin?
Ramon Berrios
05:36All in all, all in Austin.
Nathan Latka
05:38Yeah. That's cool.
Ramon Berrios
05:39We are looking to hire one more by the beginning of January, focused on product.
Nathan Latka
05:44Interesting. Walk me through the team you have in Austin. So what do they do?
Ramon Berrios
05:48Yeah, absolutely. We have, given that we are two sided marketplace, we have to grow the brand side and the influencer side. So we have to do marketing on both sides. And one doesn't live without the other, So survive without the other. So we have a brand manager who makes sure that all the brands and all the campaigns are flowing efficiently every day. We just hired an influencer growth focused manager. So this person is in charge of
06:14scaling and growing our influencer community, and then an influencer engagement. So this person is in charge of keeping the influencer community engaged, myself, and then we have a sales SDR.
Nathan Latka
06:28Well, about code? Who's developing?
Ramon Berrios
06:31Oh yeah, that's a good question. So we have a remote developer agency that works with us.
Nathan Latka
06:39Who do you use? For the Yeah. Which agency?
Ramon Berrios
06:43Yeah. Iron Forge.
Nathan Latka
06:45Iron Forge. Where are they based?
Ramon Berrios
06:47They are based in Ohio, I believe.
Nathan Latka
06:51And you like them?
Ramon Berrios
06:52I can't
Nathan Latka
06:55You like them?
Ramon Berrios
06:55Our guy is in San Diego, but the agency itself, I'm not sure.
Nathan Latka
06:59Got it. Are you are you enjoying them? You're doing good work?
Ramon Berrios
07:02Oh my god. Yeah.
Nathan Latka
07:04That's awesome.
Ramon Berrios
07:04Yeah. We have, Ian Han, who is our iOS developer. He's developed over 20 native iOS apps. He's absolutely world class. And
Nathan Latka
07:13Wait. Why do need an iOS app for this for a marketplace?
iOS App and Technology Stack
Ramon Berrios
07:16Yeah. It is an iOS app.
Nathan Latka
07:17Why though? Why do you need an iOS app for for this?
Ramon Berrios
07:20So all influencers are on their phone all the time.
Nathan Latka
07:23Yeah.
Ramon Berrios
07:23So
07:26if if if we build a desktop version for starting off, it's not the best way to gain traction and have usage on the app. I mean, there's a lot in the process that goes behind the scenes such as influencers have a busy schedule. So the brands have to ship out products to the influencers. And then just along tracking the product influencers can schedule the posts accordingly on their calendar. They need to know where that product is
07:52at all times. So we are integrated with USPS, FedEx, and UPS. And all of this is tracked through the app messaging with the influencers, just coordinating that posting schedule, is why we built it on iOS app. And now our next step is to build a desktop version for the brands.
Nathan Latka
08:09Interesting. What is the... I'm going through your example page right now, just looking at some of these clients. Walk me through the marketplace, how many brands have put at least a dollar through you and how many influencers have made at least a dollar since you launched?
Marketplace Scale: Influencers, Campaigns and Brand Clients
Ramon Berrios
08:21Yeah, so we have around 1,600 influencers active on the network.
Nathan Latka
08:27They've made at least a dollar?
Ramon Berrios
08:29That have made at least a dollar. I would say probably around 300 of those have made at least a dollar. And we've had 3,000 campaigns created. So 3,000 influencers have created posts through trend. Clients that have paid us are about 25 so far and some of those are some of those companies are Lyft. Lyft in Austin created a campaign with us based focus on UT students. We also work with we work with some of the more
09:02Cuban portfolio companies. We work with Health Warrior, Four Sigmatic, and some of the larger Kombucha. CBD
09:11Kombucha has been one of our most successful clients who had about one and a half impression. A million and a half impressions.
Pricing Model and Influencer Payments
Nathan Latka
09:19And total spend through your platform. So add up all the campaigns you've driven or that you've been directly coordinating. How much spend has gone through you?
Ramon Berrios
09:29Oh, okay. That's a good question. So we are very different than your traditional influencer marketing platform. Our influencers work in exchange for free product. So they don't pay the influencer. There's no back and forth negotiating. You pay us a fixed SaaS rate monthly, and we take care of paying the influencer a commission fee as we're integrated with PayPal and the
09:52influencer
Nathan Latka
09:52Well, what's commission fee based off though?
Ramon Berrios
09:56So they get free product and 20% of the amount of influencers that you sign up for. So if you go on our website, you'll see our pricing.
10:06For $2,000 you get to work with up to 20 influencers.
Nathan Latka
10:11Okay. Yes. Keep going. Yeah.
Ramon Berrios
10:13And they get free product and we pay 20% to the influencer of that $2,000 So they get $25 and free product.
Nathan Latka
10:22So just just to be clear, if a brand if Lyft sign Austin signs up with you for $2,000 a month, and you go find 20 influencers, you're going to take 20% of 2,000, right, which is $400 you're And gonna divide that across 20 of the influencers who posted. Is that is that right?
Ramon Berrios
10:41No. It's actually $700 that we divide across the 20 influencers.
Nathan Latka
10:45Okay. So 700 are... Go ahead.
Ramon Berrios
10:49Yeah, so it's $700 and we pay $25 to each influencer.
Nathan Latka
10:55Okay, 700 divided by those 20 influencers, that would be $35 a piece, right?
Ramon Berrios
11:00It varies. It varies. Sometimes if they don't complete, it's up to 20 influencers. So if you didn't reach to your 20 influencers within that month, then it varies how much percentage of the $2,000 it is, but it's a $25 flat rate fee to the influencer.
Nathan Latka
11:16Okay. But they're not actually getting cash. You're essentially going and buying kombucha, shipping them kombucha, saying, take a picture with this.
Ramon Berrios
11:22Yes. And then we pay them cash $25.
Nathan Latka
11:25Oh, you do still pay them cash?
Ramon Berrios
11:27We pay them cash. Yeah.
11:28Dollars.
11:29And then we
11:30have a higher tier of VIP influencers. Those get a $100.
Nathan Latka
11:34Okay. So you have paid 300 influencers at least like one payment of $25.
Ramon Berrios
11:34Yeah.
Nathan Latka
11:34Interesting. Interesting. Biggest influencer on your platform is who?
Micro-Influencer Strategy and Churn Risk
Ramon Berrios
11:48Television of Nomads does create a great amount of content for us, and go for yourself are the ones that really stand out.
Nathan Latka
11:56Sorry. Who has the most follower, the most Instagram followers?
Ramon Berrios
12:00Oh, gotcha. Okay. Around a 100,000 followers is probably the most in our platform. This is a micro influencer platform.
Nathan Latka
12:08You know, by by the way, micro influencer, I mean, it's hot. There's a lot of people realizing you can have someone a thousand followers, but they're very influential and you pay them and you drive four sales, it works.
Ramon Berrios
12:18Yeah. And at Lyft, when focused with us, some of the larger brands that are working with us are working with influencers that have around 2,500 followers.
Nathan Latka
12:25Yeah, that's interesting. That's interesting. Yeah. Okay, good. And I'm actually shocked about this too. So like mostly these are usually campaigns like Lyft starts the campaign during the school year and they stop when students aren't in Austin anymore because they're going back home. But your churn is very, well, was very low. You just lost two customers. I mean, my gut tells me you're gonna have a lot of churn problems because this is so campaign driven. How
12:46do you get people to keep using you even when they're not actively running a campaign?
Retention Through User-Generated Content
Ramon Berrios
12:51Yeah, that's a great question. So besides actually getting influencers to post on Instagram, one of the biggest value ads from trend is the user generated content. So given that we are an invite only network, the quality of the content you get doesn't go anywhere. And you can actually use that content and repurpose it for your ad spend or for print advertising or whatever it is, any marketing collateral. And we actually been able to prove that the
13:20content created through trend will actually increase the conversion rate of your ad spend, and you're always gonna be running ad campaigns. So at the very least, you'll have great content that you can repurpose. However, you should talking about your product. And like I always say, if it's worth doing once, it's worth doing over and over. So we try to ingrain that onto our customers.
Famous Five Rapid-Fire Questions
Nathan Latka
13:44Ramon, we're out of time. Quick questions here, famous five. Number one, what's your favorite business book?
Ramon Berrios
13:44Deep Work.
Nathan Latka
13:44Deep Work?
Ramon Berrios
13:44Yes.
Nathan Latka
13:44Number two, is there a CEO you're following or studying?
Ramon Berrios
13:57Not really, but, I'm always impressed by Jeff Bezos.
Nathan Latka
14:00Number three, what's your favorite online tool?
Ramon Berrios
14:04Asana.
Nathan Latka
14:05Number four, how many hours of sleep do you get every night?
Ramon Berrios
14:08Eight or nine.
Nathan Latka
14:09And what's your situation? Married, single, kids?
Ramon Berrios
14:12Single.
Nathan Latka
14:12Okay.
14:13No kiddos running around?
Ramon Berrios
14:15No.
Nathan Latka
14:16Alright. And and how old are you?
Ramon Berrios
14:1926.
Nathan Latka
14:2026.
14:21Last question. What do wish your 20 year old self knew?
14:26Self knew.
Ramon Berrios
14:26You don't need a college degree to be a somebody.
Nathan Latka
14:31Guys, you don't need a college degree to be a somebody. He got burned by Facebook on his last company after growing it to $50,000 a month. Shut it down. Launched trend.io. Now he's up to 20 customers paying $1,200 a month, about $25,000 a month in revenue. Again, about six months into the company. They've raised $750,000 in convertible notes. They're burning about $5,000 per month right now. Team of five in Austin, about 10% monthly churn as he's helping
14:53influencers or micro influencers partner with brands that are looking for those same target audiences. Ramon, thank you for taking us to the top.
Ramon Berrios
15:00Thank you, Nathan.