How Ubiweb CEO Patrick Desrochers grew Ubiweb to $17.6M revenue and 550 customers in 2024.

hello everyone my guest today is dan di loretto he's the co-founder of ubi web with 15 plus years of sales experience 15 and online marketing he developed a turnkey on one solution for smbs for their online marketing primarily targeting canada currently he started out of his basement with one partner and bootstrapped their way so far over 700 clients and over 20 plus colleagues dan you're ready to take to the top absolutely all right introduce us to your partner here with what's patrick working on this is pat so i am the head of sales so i run more the sales side and patrick is more the president so runs more the operations component um that's it so both of us started this uh the shindig out of our basement or my basement our basement my basement uh in 2017. and who owns more equity 45 45 and somebody somebody wow very good right down i like that that's very is this someone else's vc did you raise capital or no you're bootstrapped bootstrap so what happened was actually a childhood friend of mine i gave him this idea back in the day and he started as a pilot project at a web agency of his own and we had the concept of you know potentially leasing websites and doing open-ended leases and turnkey solutions for small business owners that just don't have the time to deal with this and want to centralize everything with one person so we started this in 2014 or 13 and he picked up about 15 20 clients uh with zero sales effort never courtesy called them barely followed up with them and they stayed for over two and a half three years so basically validated the the model and the concept and then we decided to go all in so he became our web provider if you will i guess our manufacturer of our websites um and in exchange he took a percentage of the business how when did you guys launch the company your first customer what year 7 2017. that was our first client but we inherited the 15 or 20 clients that were on before us as a project which we how many customers today we're about 700 we have about 550 live and 150 to 200 signed that are going live in the next three or four months because we're always signing three six months ahead of time what does it take to get a customer live what's that mean yeah sure so um one of the biggest challenges is uh the type of person that we uh rather type of business that we that we target so that's a lot of blue collar um these are people that are super busy in their day day-to-day so what does it take to get someone online tenacity making things simple and a streamlined onboarding process and then afterwards that that streamlined customer experience is essentially my job from day one in my job so these customers these 550 that are live currently about how much they pay you guys per month to use the technology the rpa right now is at about 265 monthly 265 okay and has that i mean is that been pretty consistent over time are you guys drastically moving sort of up or down stream upwards so i'd say that about two years ago in our first year we were around 181.90 um and now we're just slowly there's organic growth because people are throughout the years will upsell themselves to our packages because every year you have the option of downgrading renewing or changing your package upwards um and then so you have your organic growth within your churns our turn is actually 109 so that's part of well that would be that would be not good churn your retention your net retention is 109 yes so sorry my organic revenue our organic revenue grows nine percent we don't lose clients basically yeah let's come back to that in a second real quick so 550 customers at 265 dollars a month i mean you guys are doing 150 grand a month right now in revenue something like that basically which is what a 1.8 million dollar run rate a little over because we sell google ads as well we do sem so that's not a subscription based model that's an add-on product how much ad volume do you guys process per month currently out of all the ad spend not much our media spends around 60k a month so okay for your for your customers yeah so we have about a 30 management fee on top so we're making about 20 25k monthly on that yep is that included in 150 000 per month or it's extra that's on top that's gravy yeah interesting that to me sounds like an interesting growth opportunity right if you can get that 60k up to 600k or 6 million that starts becoming very interesting so we don't like that revenue too much because it's less profitable and a lot of time and energy versus our subscription-based model uh or our our wise if you will our website as a service the advantage there is that when we have that client they don't leave and the more they spend the higher they become they become more approachable we're a very competitive industry so we don't like the big spenders i know that's interesting but this the least you spend the harder is to poach that person and with the service we give it's very difficult to get one of our clients that's that's fair so you're going to go for a high volume of customers at a lower rpo versus less customers paying you you know putting millions through your platform per month you got it i've never had 10 clients at 500 a month of google ads than one of 5k fair enough fair enough let's go back to the churn stuff they were just talking about your i understand your net revenue retention is about 110 or 109 but peel back that onion for me there's two components that your gross revenue churn and then you add back your expansion to get to 110 what is your gross revenue turn annually so our existing clients in other words our existing client maybe i'm answering your question incorrectly but our existing clients uh actually grow nine percent without any new just because they upgrade their packages i know i understand i understand that what i'm asking is if you look at your customer base from exactly a year ago some portion of those folks will have churned and others will have pay you they'll pay you more now the amount they pay you more is nine percent higher than the amount that churn which is why you have 109 net retention what i'm asking is what is gross what percent did you lose before you add back expansion that's it's about five percent it's about five percent it's hard to tell we lost this year and pat that's five percent monthly or on an annual basis on a manual basis okay got it so five percent gross over new churn you then got to get up to 109 so you have about 14 15 expansion that gives you the 109 net revenue retention bingo where's the expansion coming from are you upselling seats or product what are you upselling packages so like we have three packages bronze silver and gold uh whereas i'll give you an example of bronze is just a basic website with zero seo then we have a mid-level lesson then we have a higher end seo so you go anywhere between 180 a month and 500. so a lot of people will go with their bronze or silver because they don't really know us they're hesitant we want to build a rapport and then usually in year two the trend is the renewal or the migrate up a package how do you do this stuff at scale right so you upsell your silver plan things like quarterly search engine optimization you introduce three topical keywords um things of this nature i mean are you actually going out publishing articles getting backlinks to every client yeah so we work with uh work with a lot of different partners nate that help us some of this is is technology we've developed internally and some of it is also partners that we partnered up with that allow us to do this at scale obviously you know we when we started bringing on these partners we looked at um doing some of this stuff internally and oftentimes the cost just completely outweighs even if we have you know funding from a vc or we're able to to get funding just the cost to maintain it and continue to grow with our growing customer base it doesn't make sense but if someone has done it has done it well so it's just a question of going out there and getting the best partners possible yeah interesting i mean that takes a lot of work i mean if you assume 550 customers are on a plan like that and you've got to give them three backlinks written right in articles on your partner blogs per month i mean that's 1 500 guest blog posts you're essentially making per month unless you put one blog post up and you can link to six of your customers in one shot i mean how do you scale this so to be honest our the blog posts is not something that we do at the uh at the level of um we're actually working on another product which will actually have that type of uh seo that level of seo rather um the type of seo that we do for these are more as smbs and in rural less competitive areas so blog posts aren't really necessary to go get that uh that top fold um or rather h1 tags will do the trick basically h1 tags backlinks um a good site structure google best practices when you build the site is going to go get you usually a top three picture you're a plumber in a rural city with a population of 8 000 people it's not very cutthroat yeah but so how do you go get a backlink let's say tom the plumber in idaho once needs one backlink that says plumber idaho on another blog don't you have to go find that partner and get a blog post written with a backlink backlink might be the wrong word citations is essential okay what's the difference uh a backlink is...