webz.io Revenue (2024)

hello everyone my guest today is run Jeeva he's a serial entrepreneur with over two decades of hands-on experience in software development and leadership positions after Finn founding um gilja searching for online online discussions and co-founding bazzill a-- one of the top web monitoring and analytics companies in israel he went on to co-found web Hosea his current project it's a leader leading global provider of structured web data where he serves as CEO and lead technologists Ron are you ready to take it to the top yeah all right tell us about web host what do you guys do and how do you make money well we sell data feeds we turned a web into machine readable data feeds and either individuals or companies tap into this data to feed their analytics applications so it could be from brand monitoring PR applications to service security financial applications anything basically leveling the playing ground letting anyone have access to data from the web interesting and what's the revenue model is it per API cars or a peer place asks what's the revenue it's a sauce or data service a subscription-based you can go ahead and then it's a freemium mall basically anyone can sign up for free get access to 1,000 API calls for free and then you can upgrade downgrade can send me time we don't shackle you into long term contracts because if you see value you will keep on using us that's what we saw and that's how we go so we have private users developers and we have enterprises using our software and give me a general sense because I know you having you have multiple kind of pricing levers on your monthly subscription plans or any from news blogs and reviews to e-commerce product in a broadcast media transcripts so do people have to choose what kind of data they want and then basically if they want multiple forms move those levers up on each category exactly yes so they can start very small and scale up down very logically elastically we basically we see us doing today web data or data provisioning what Amazon to do - server hosting so you can go ahead and scale very fast and low as you need you don't have to go ahead and buy a plan upfront into so to avoid going down kind of every customer cohort just quickly give me an average customer we talk in a grand a month ten grand a month a million a month generally speaking where you at well I use it to pay or money or a revenue per customer per month on average so whatever it would be between one thousand to three but we have enterprises that pay and tens of thousands per month and we have and it doesn't really depend on the company we have startups that are paying a lot or we have enterprise to pay us 50 dollars depending on the use case and for the small you know for the small clients it's a cell phone boarding process we don't have to invest anything in in support or customer success we have of course well support customer success but we have tens of thousands of users not all of them are paying more freemium but we don't have to invest a lot of customer success and support because it's a very very very simple system what's your team size today we're about 20 ok and none of those people are dedicated to sales or onboarding no we have two salespeople we have two says support people okay all right now give me more the back story here you've had success obviously in the space what year did you launch web hoes so well who is this kind of a long story because we started mentioned in the beginning I started baking those seven even further I was a self-employed developing those sort of p2p software and the platform yeah file sharing applications and and it were quite successful but I didn't see really create career going forward with it so then I went ahead and thought about maybe I create something for businesses and all those applications had message boards on them however people chatted and I thought to myself what people are speaking and talking companies might be interested in other people are saying about it about them so I when I hadn't created kind of the first challenge was to create a system that will gather this information that was the first basic technology didn't know what to do it within short credit on Gilly b2c search engine basically and again subtractions got a VC calling me I know what you're doing that I know you know what a VC was even eventually my specie from Israeli was interested to to invest seed funding of about six hundred thousand dollars but no one else in Israel believed in the you know in brand monitoring market I could never know V Israeli VC ever invested in this field so so what happened to that company did you just shut it down or you sold it for a nice price or what so another company that we together decide to go ahead and build bazzill and eventually that company papazilla acquired on kili got it and kind of was too late to go to the international markets so we succeed in the in the Israeli market but failed going global and the last application does project that we tried to before weather is one that we tried to launch was a application called PR track II that was supposed to track what happened with pasilla so did you shut that down are gonna soft landings working it's doing very well in Israel but we try to go global and failed who's running that now how did you remove yourself a CEO and keep it going we have multiple founders so one of the founders stayed and kept on running and keep on running Mozilla and how much how much money has that company raised oh 1.5 million something like that so you laugh you didn't think it was the future you knew your other founders wouldn't do a great job with it and you did what so we started developing another application and the reason it failed was because it was supposed to track PR online and the main issue was companies told told us that they couldn't find or found mentions via Google not via application via PR track it and when I tried to find a solution who will help us increase the coverage I failed you know it all Google is closed garden in that sense they are they're excellent for humans but for machines that want to tap into their index there's no way so that's where we set our focus to go ahead and create a basically a repository database that will open the closed garden that Google has and provide these access to anyone that's where we said to create web hoes and start with news blogs message boards but and what year was that so about 2015 2015 it was a spinoff and what have you scaled to today in terms of total customers so we have hundreds of customers paying customers no longtail most of them and small customers so about so most of customers are small or between 50 to 2000 dollars a month but we have some dozens and enterprises that are about 30 about 70% of the income our enterprise yep when you say hundreds I mean are we talking three hundred or a thousand fifteen and what do you what do you grow in a company i right now a year over a year would you say like a hundred percent fifty percent ten percent yes so between 2016 2017 one hundred percent but it's easier when you have low e low lower income yeah now we expect to grow about seventy percent we are really accelerating as we are providing more benefits for example we recently launched the dark web data feed and we see a lot of cyber security interest so we security companies that word money's bigger there and we see more more brands tapping into this data so if on the brand monitoring you had marketing departments using our customers more and more brands since they're hiring internal data scientists they want access to the data so they come straight to us and not necessarily through our clients so for marketing departments it's excellent but for data scientists they need the data Iran going back real quick to growth so a hundred percent year-over-year the past twelve months ideally seventy percent over the next twelve months here through 2018 give us a sense of where you're at today in terms of M our our $206,000 yep and that's about right you know if I take you know 300 customers x a $900 a month price point you get about 260 or somewhere around there yeah that's great and then since you grew a hundred percent year-over-year over the past twelve months that means back in December of 2016 you were doing what somewhere around 130 grand yeah yeah interesting yeah interesting and what's driving most of this growth where are you getting these customers from so it's organic we actually we're now increasing our sales team because we're not doing our boundary don't want to do our bump but most of the our our leads are coming inbound so from AdWords but also organic or from our clients because of the method of the freemium model you have a grassroot approach you are the goat we are weathers is the go-to place when you wit need content or web data so developers are talking about us and projects are being published using our data so providing a freemium solution is also a great marketing approach you mentioned some ad spend give me a general sense of how much you're spending per month on direct paid $4,000 lots so very little known in that paid Channel on average what are you spending on on CAC to acquire these guys oh that's a good question I have no answer for you but we just are installing our BI system to help out with the numbers that you are requesting which system did you did you install out of curiosity I think Microsoft bi has taken okay I'm interesting about my age so you so right now you don't really know what your CAC is no no it's very low because we don't rely on on other words to really to get our customers it's mostly organic so we mostly content yeah and of course growth route how many of your team of 20 are focused on creating content to actually and to and we are now using external companies as well to use our data to write about it and we have we see a lot of developers writing about us so that's like what tool do you use to get other people to write about your data doesn't say we just provide this data so people are you know using the day to do the data and and writing about how they D what yep and writing blog posts turn in a SAS company is obviously critical tell me about your turn so again that's a hard number to test that we didn't really test until recently I can tell you that on the enterprise part so the higher the amount they pay we see near zero churn we have clients I told you we story you know seven with providing this data so we have clients going back know seven we never lost an enterprise client and unless he went out of business of course on the lower plans there the freemium the $50 plan as we see much higher churn you're giving me logo churn obviously right which is you know hey a lot a high number of small customers will churn we don't really care about that because we don't have any churn in our in our higher market so that's why most people like to talk about revenue turn instead it normalizes that that difference what are you at in terms of revenue churn I don't have a number to give you a sorry how do you not how do you not know that number that's like a critical number in a SAS company when you are VC back it is but we're not even when you're bootstrapped I mean how do you know if you have a leaky bucket or not what we do have but its own small numbers I told you that less than what percent probably Daniel annually yeah okay and that's gross Turner net so when you add back your expansion revenue year over year that's it yeah that's healthy so now revenue to our annual II less than five percent that's healthy know how what you know as you grow and you try and drive seventy percent year-over-year would you say more of your revenue or more of your expansion opportunities coming from getting people to move those little levers on your pricing page up driving expansion revenue or actually bringing on brand-new customers bring brand-new customers out sale you know it happens we don't put any effort on out sailing currently at least we will in the future but currently I wanna more extend my market reach and not necessarily um you know optimizing our current clients that's that's the easy way to go but I rather have bigger market to stand on that's interesting that's an interesting approach considering how nicely your pricing plans would allow a sales team to drive expansion revenue it's just getting them more usage it's nice but it really depends on you know on and the use case on the demand of the client you know I want pool I won't push a client to go ahead and increase its usage if he doesn't have a use case if he grows it grows we go with him because you know I always believe that that's why weak you can cancel anytime that's why you can downgrade in time I really believe that we shouldn't shackle for long term because even if if someone is for some reason stopped using our service I don't want his money yeah well I just be clear I'm not talking about locking people in what I'm talking about is if people are getting value out of your product they should ideally use it more and it should drive expansion revenue and what you're saying is no we're not focused on expansion right now we're focused on getting new market share because you're providing an API the more clients they have the more API calls they will need so they basically are working for us in a sense the more successful they are the more API calls they will need they will upgrade organically their plans I don't need to push them to do that that's that's not necessarily I rather have a new client or focus my efforts to add new clients so you don't have an infrastructure like you know that all the guys that are in the kind of web plumbing space and I mean like you know that's you know zapier segments to these guys it's the same model as yours in terms of billing per API called data as a service and they can they I mean the wage showed me they can drive more API calls by helping their partners their customers launch more integrations you're saying you you can't do that same thing you can't drive more you more useful usage no because it's usually plugged into a specific use case so the more sometimes you know they want used API correctly and we will help them with that but the focus now is adding more clients rather than trying to optimize their current clients we have got an you said your bootstrapped right yeah last question here as you think about scaling and I imagine your your cashflow positive right since your bootstrapped yeah how do you think about lifetime value on these guys I mean it they can be a dangerous number and it's hard to come up with but do you have a minimum that you know they're gonna stay with you for at least X amount of years and be worth X amount of money well I can tell you is for enterprise or clients at about $1,000 a month about one year that's for sure that's that's a good very good estimation we've you know I've been I've been out three in about 12 grand at least yeah at least yeah yeah that's for the higher about $1000 plans that it means that there have them they have a mature platform and you know since we are an API we are in the backend and no human is intervening so it's not like you have a system the system that the guy finds out one day that it stopped using the system and then he cancels sure as long as we're doing a good job we will stay with them and Ron is a whole team based out there in Israel yeah okay very cool let's wrap up here with the famous five number one what's the last business book you read I don't read books okay number two is there a CEO you're following or studying there in Israel oh sorry spell it see me though web Oh yep yep number three is there a favorite online until you have for building your business besides your own so building my business I'm using Google ladies you know that helped me yeah number four how many hours of sleep to eat every night totally little but that's because my kids six seven six hours and how many kids three and are you married yeah okay and Howard are you Ron forty one forty one last question what he was your 20 year old self knew like when to walk 20 years old on you uh failings part of the success failing is part of the success there you guys haven't he has been through it many times with his first company then rolled up into his second company and then he had great founders there so he left that company is now building web Hosea and API back pricing model it's essentially data as a service launched it officially in 2015 working on with it on it with a team of twenty out there in Israel their bootstraps serving about three hundred customers 250 to 300 paying on average called a grand per month so doing about 260 grand per month in revenue that's up from 130 grand per month just 13 months ago so one percent year-over-year growth he's aiming for somebody percent year-over-year growth this year and look he's on track to do it with use unit economics less than five percent net revenue churn annually Ron were rootin for you thank you for taking us to the top Thank You Nathan