Wunderkind Revenue, Valuation & Funding (2024)

[00:00] Hey, folks. My guest today is Ryan Urban. He's the co founder and he's the CEO and founder of wunderkind. He's been had an obsession with undeniable performance, and under Ryan's leadership, the company has been named one of the best places to work by both Cranes New York and was ranked the number one fastest growing software company by the Inc five hundred. Ryan, you ready to take to the top? [00:18] >> Let's go. Let's go, Nathan. What's up? [00:19] Alright. So previously, BounceX and now wunderkind, next gen performance marketing. Tell me a little bit. I I see the new hairdo. Do you still have black toenails or no? [00:28] >> Oh, I've I've we got hair nails and everything. So now we got a now we got a little Batman by all means. Got got a little Viking stuff going on. Got a little Spider Man too. [00:38] I love it. [00:39] >> Every two weeks, you gotta go fresh. Yeah. [00:40] So this means this means you're not going on an IPO roadshow anytime in the next three months. Right? You know what? I [00:46] >> you know what? The world's come a long way. So I I actually was on a we did do a kind of a pre IPO, like a crossover fund process, and I really wanted to kind of introduce what wunderkind does to a lot of the public company investors. And because at some point, it could be next year, it could be early twenty three, whenever whenever whenever we feel it's appropriate. Yeah. We're we're we're probably gonna be a [01:08] >> a public company at some point, it's something we're we're we're looking forward to. But, yeah, like, you you know what? Like, you can have your you can have your nails painted and and do that, and you're not judged anymore. It's it's awesome. It's a it's a great part of conversation. I I I kept the sides. I didn't have designs in the sides, but this is Halloween. So now now we've kind of completed that process, and now [01:26] >> it's time to have a little fun there too. So but everyone's pretty open. It's the world's way more inclusive than it was three years ago. So Folks, [01:32] it's you heard it here first. You can have your black toenails and your IPO too. [01:35] >> Also, kinda like gonna script it. [01:41] I love it. Wait. So what was the name of the thing that you said you did where you sort of just put feelers out there, let people know who you were? It's called a what? A it's not a No. No. [01:48] >> That's that's like we we went through I know I it's a strategic finance process. So some companies need a fundraise to, like, companies that lose a lot of money. For us, it's like we we're doing great. We're we're probably by the time this airs, maybe even a thousand people. We'll probably be 800 people soon. This has been a a great year for us, our best year ever. And I'm like, I'm calling from the I'm dialing in [02:10] >> from the World Trade Center right now. [02:11] Can see us. [02:12] >> Look at this. Yeah. This is we're on the 75th Floor right now. I'm in a a blue rose a room. You can check it out. [02:18] And you negotiated a killer deal on this office space, I believe. Right? [02:22] >> We we did. Well, it's look, it's when we came here, we were planning this out about four years ago. We've been here about three years now. And this is the this is the most beautiful space, I think, in the world. And it's a and they they really wanted an anchor technology tenant that's that's on the way up. And we came in, and the whole building really came alive. So this is like like, people are we're we're [02:43] >> coming in. It's just really good energy. So it's it's awesome. And maybe we'll talk about how how we're kinda leading leading way on some of flexible and office stuff after. But, yeah, the things are going great. [02:51] I'd love to chat more about that in a second. Yeah. When you say fastest growing ever, mean, how what'd you guys grow at revenue over the past twelve months? [02:57] >> Yeah. I it's it's it's I'd say, I'll I'll take a step back. Last year was just our best year in delivering improving the value of product service. So, like, the revenue growth comes, like, when when you wanna grow revenue wise, that that that comes after your your product service get really good. And and for us, like, we sell revenue. So a lot of software companies sell, like like, time savings and efficiency. We our software delivers revenue [03:22] >> by improved experience. And we we improved our regular offering so much of our identity as a technology, like, got that really up to a different level where we recognize nearly 50% of of people. It's awesome. We we delivered an enterprise text platform last year, and that boom where if someone used our full story, we can we can increase the business by by 20%. And that's like a real number. It's like within a year, like, we can [03:44] >> increase almost any business within 20%. So So it's pretty cool. And and generally, we're doing or if if someone has, a course, we were in six months, we're averaging a 10% increase, and we do that by scaling their personalization. So then here, yeah, then you you get some the big growth world. Yeah. I think, like, revenue wise, we'll probably we're we have big scale. So I we don't, like, publicize our exact numbers. I know you you [04:05] >> you you do some inferring. But, yeah, it's gonna be about a 50% revenue growth 50% growth year for us. And that's that's on a big base, and that's without, like, without deploying, like, a ton of strategic financing. So we're not the company that's raising $200,000,000 rounds and, like, hiring a million, like, 300 more salespeople and and playing stuff. We're earning it. But almost all of, like now it's, like, half our customers come by word-of-mouth for bid [04:27] >> for enterprise software company. That's very rare. It's almost half of wunderkind people work here come also by referrals. So our clients are referring us and our wunderkind's our employees, our wunderkind's referring other people here. So that's like, those are the important numbers. We like so we're we're at the forty forty club. We're like, we'll go get the fifty fifty club. And eventually, like, it's just all of our clients will be referred by the clients, and and [04:47] >> all of our all of our wunderkind's will be referred by the wunderkind's. So it's it's really nice. And I'm honestly, like, we our product and service and our leadership team and our rev is we can be a public company right now. It's like, wanna get a feel. Like, to be a public company, you we you of course, you want predictability in revenue. I want predictability on shipping value, on operating velocity. So and we have good operating [05:08] >> velocity, but I want the innovation velocity. I want predictability and innovation velocity. And for me, I wanna be shipping like three to 5% in in in revenue a quarter. And we're we're getting close to that. So it's a it's like we we now have offices in New York, Indianapolis. I have a 100 peep 110 people in Indianapolis now, which is awesome. It's like having some geographic diversity. It's not only you get, like, different kind of people, [05:28] >> it's like it's it's really nice. You get access to different talent. And people have a great office. You you people come to your company and know what success is. Like, it's just good energy. It's it's good good blood. And London's really building out. I'm opening office in expanding Austin now. I'm opening office in Paris and Paris early next year. I'm going to Ukraine in a few weeks, and we have some people there. We're gonna do some [05:48] >> nice there. Probably Quebec City, probably Miami. We're just on the phone, the mayor of Miami a couple weeks ago. So there's a new mayor in New York now, and, like, we really wanna really recruit a lot of technology that comes to New York, and we wanna be the ambassador of that. It's like, come come to New York. It's it's a cool place. So it's a it's just an energizing time. It's I've this is year and I [06:05] >> for us. Like, we've each other for like five or six years. You knew me when we were like doing like 20,000,000 revenue. So it's a [06:12] I remember those days. You hosted a great poker event a couple years ago, which I met a lot That of cool people was a ton of fun. But and you guys are growing. Mean, you know, you pub I know you don't like talking about numbers, but you did put out publicly on February twenty sixth last year saying the company broke a $100,000,000 in annual revenue, and that's when you rebranded to wunderkind. So if you Upbranded. [06:28] >> Upbranded. Yep. You what? Upbranded. Not rebranded. [06:31] Upbranded. Okay. You're you're you're rebranding the rebrand. So it's upbrand Well, there are rebrands. [06:36] >> A rebrand is like when an up brand is like, you really take your heritage and and everything you are and where you're going and and bounce actually was That's fine. [06:43] I get it. I get it. It's a much better name. A much better name, and it [06:46] >> matches But your [06:47] but but point being is early February last year, you guys broke $100,000,000 in annual revenue. If you're growing 50% year over year, still that's a massive base. I mean, that would put you over $150,000,000 now in revenue. Is that right, annualized? [07:00] >> Can infer Med's still a private company, but we're definitely a- [07:04] But Ryan, I don't wanna infer. So you just said you were gonna grow 50% year over year on a big base and you publishized the base a year ago. So I only, I don't wanna infer here. [07:11] >> Yeah. So it's, you're in the ballpark. [07:14] Then- Okay. What is the revenue split? Let's talk about the product, right? Because you built a great product. Doing multi channel marketing for three core areas. Tell us about those areas. [07:22] >> Yeah. I mean, I call it multi channel marketing. We have two customers. They're they're one customer brands, and we work with some of best friends in the world, and some of our brands are commerce brands. Commerce brands means you're doing transaction online. So sometimes it's like e commerce retailers. We always call it commerce. So there's no such thing as direct to consumer. It's like it's just commerce. And our second kind of the second kind of brands [07:43] >> we work with are our publishers. So one customer group is brands. Our other customer is people, consumers. So every product we build is, like, for the benefit of people, improve improving the shopping experience. So we build things like, what are consumers like interacting with? And and then we then we connect brands to consumers, basically. We that's that's kinda kinda what we do. I everything we do is is taking, like, what people call personalization and and scaling [08:07] >> that. It's everything we do is generally one to one. It's like, how do you create one to one experiences and scale those things? So we invent all new one to one technologies. Specifically though, [08:16] retailers, publishers, and travel. Right? [08:20] >> Oh, yeah. And it's not only just retailers. It's like anything commerce. So like like say, like, some big cable companies and big cell phone manufacturers, like so a huge company is like, they're doing trans they're doing transactions online now, they're doing billions. So now, we're working with a lot of companies in the the big, big range. But you know what? Also, we're we're supporting companies doing even even like 3,000,000 online, like so like, now we're starting [08:42] >> to work with those companies too. And going back to back to last year, like, we made some big business decisions to that were not short term revenue focused, that were just client focused. Like we like, you mentioned travel, yeah. We had some airlines and some things, like their whole business was shut down, And we have a lot of companies that have a of retail stores, and yes, their online business went up, and then then they shut [09:01] >> down a few 100 retail stores. And there are some businesses that really benefited. But like, we just did the right thing. Was like, hey, like like, we might need to pause some stuff. We might need to right price some people. We may need to give them a new product that drives more revenue. And we just create a menu, like, hey, like, who needs support? And let's like, forget what our contract says. Let's support our clients. Let's [09:21] >> support the industry. Let's put out the right content. Let's let's get let's just do the right thing to support the industry. And and we would figure out how that, like we didn't matter what the impact was gonna have on our business. We were gonna do the right things for everybody. And then we did. And then then basically, once q three last year, like, our business started really taking over, so we did the right thing. [09:37] And Ryan, if an advertiser puts, call it, 50,000,000 or $10,000,000 through wunderkind, the wunderkind platform, how do you count that as your revenue? Is you taking a cut of that or what? [09:46] >> Okay. So, I mean, we have we have two kinds of revenue. It's one is just SaaS revenue. So that's people. I mean, our our flagship technology is our identity resolution technology. So, like, for for, say, a large name a I like you have your book in your background. I don't know which clients I can name or not, I don't wanna have called by a cut. Just name a name a name a large name a large retailer. [10:05] >> Like, a large retailer. Target. Target. Cool. So Target, say they're Target, they're I think they do they're a public company. I think they do 25,000,000,000 a year in revenue online. It's like 75% of the people who come to Target's website are their customers, and they have they have permission to email them, market to them. The problem is, like, it's like probably 2% or so. It's definitely under five percent of people on Target's website are authenticating themselves, [10:31] >> logging in. So Target doesn't can't recognize their own customers. When you can't recognize your own customers, like, not only the kind of website experience you kinda gotta start over, it can't doesn't [10:39] have I mean, take us back to before you go into the Target, so there's two revenue streams. There's a SaaS, and then what's the other one? [10:43] >> And and wunderkind advertising. Wunderkind advertising, which which I I think will probably approach that itself next year. We'll approach [10:50] And Ryan, that's a percent of of ads basically is how you make money there? [10:54] >> No. No. I'll I'll I'll I'll give I'll give you a thirty second one there. On on the on the SaaS side, we we really help brands recognize their customers and scale personalization. So, like, Target, in that example, it's their almost all their most of their traffic is their customers. They can't recognize anyone because people don't create accounts and no one's logging in when they're browsing. So all the personalization efforts, let's say if they were a customer, [11:14] >> which they they will be at some point, we would just help them scale their scale all their email personalization efforts. And by doing that, we usually take be able to take revenue that people drive personalization, especially personalized email from usually 1% of the revenue to 10% of revenue. We're usually able to grow email partners by 50% by scaling personalization. [11:30] Got Personalization makes sense. Skip over to the ad side. [11:33] >> So the ad side, wunderkind advertising, we're we do advertising infrastructure. Our view in the world is that advertising should be content. It should be a vibe. Advertising should be enjoyable. And a magazine's enjoyable. Actually, Instagram does a fantastic job of of advertising being enjoyable. Even your ads you see in Amazon, their response results when you do a search, they're they're they're pretty valuable. The advertising you see in Amazon is really good. So we work with, like, [11:54] >> half the Comscore 250. You work with, like, like, the biggest ones, like the CNBC, the Weathers, the c n the CNN, those kind of big publishers. And we we really help them make advertising a vibe. So we we actually add infrastructure. We create the units itself. So we do that. It's like, let's create this beautiful, like, kind of newsfeed style units, like a magazine style unit. [12:13] Is there a flat fee service to do the creatives, and then you also take a percent of the [12:16] >> No, no. So, we create the infrastructure, and then we also we help we work with agencies, and the agencies actually buy our exclusive inventory through a private marketplace. I So we just felt that not only facilitate the technology, we also facilitate the buyers. And it's it's some it's it's very premium brand advertising. So it's advertising like it performs great for the brands, it performs great for the publisher, but the users enjoy it. It's like users really [12:38] >> enjoy interacting with these ads because we don't we don't when you want when you get to a publisher, you usually get to an article. What do you wanna do? Do you wanna read the article? You don't wanna be it you don't wanna be [12:47] >> No. No. Makes sense. [12:48] So in 2021, how much how much how many ads will you process to the marketplace? Are we talking like billions of ad [12:53] >> So we're actually, think effectively ads in probably Facebook and Instagram are probably $30 or $40 CPM effectively. Ours are probably $10 or $12 so it's [13:02] a How much volume will you process in 2021? Total volume? [13:05] >> I'd say it's a lot. It's significant amount. [13:11] More than a billion right now? [13:12] >> I would say next year oh, definitely. I'd say next year, we'd be getting closer to 9 figures in revenue on that. So [13:21] But but ignore your revenue. I'm just talking, like, total ad spend processed. I mean, it's north of a billion. It's north of 5,000,000,000 this year? [13:28] >> I had I I don't wanna go exact number. It's it's it's it's Internet scale. It's a it's a lot. It's it's a [13:34] So what do you take then? If I put a billion 3, are you taking 1%, 2%, or is it something different? [13:38] >> It's not 1%. We're we're we're we're facilitating everything. So instead of charging a technology fee or a CPM, like, say, Google, when you when you double click, they used to charge you a CPM, and you sell your own ads. So we we we we not only facilitate the technology, we also facilitate the demand. And for everything we do, it's it it depends on it, like the the publisher said. [13:58] Lock up inventory at $20 CPMs and bill it out at $30 CPMs or whatever margin you want? [14:04] >> It's it's we're we're facilitating everything. We even do for the agencies, we'll even But Ryan, sorry. [14:08] I just wanna be very clear on this. Is that how you make money? You lock up inventory at a fixed CPM. You mark it up a little bit, and you make the spread. [14:16] >> It's not exactly that. So we create the ad units, and we facilitate the demand. And then we help the agencies actually create the ad units. The agencies will then go buy it, and then we take a cut of that. [14:27] The money [14:28] >> comes to us, and then we we will get the publisher 50% plus of of that. Like, the publisher and it's it's not we're not securing inventory. It's our inventory. We're we're facilitating ad units, the demand. We're doing everything. The publisher just gets a really nice really nice ad experience, and they they collect money. So and actually, for publishers, there's two parts. Like, publishers, we they we have a SaaS business there where they pay us money to [14:50] >> drive audience development, collect emails, write subscriptions. So they pay us, and then then if we have a lot of publishers where they pay us, and then we pay them. So it's like Got it. And sometimes two different departments. So it's really cool. [14:59] And we're we're we're running out of time here, Ryan. So quickly, last twelve months total revenue, what was the split between your ad business unit and the SaaS business unit? [15:06] >> I mean, they're they're both growing. So they're both growing on they're both they're Yeah. [15:10] But what percent [15:10] >> was It's it's let's see, percent of SaaS. I know you you like to like to do math here. And last twelve months is like I always think the future twelve months I say the future twelve months will probably be 40% advertising, but they're both gonna grow. I don't look at it as a percentage of pie. It's like, both the pie's gonna grow. These are ultimately, these are gonna be both billion dollar revenue businesses. And I [15:35] think But what's bigger right now in terms of your last twelve months of revenue? [15:37] You made more money on SaaS? [15:39] >> It's not more. It's it's they're they're both yeah. Yeah. I mean, we're our our one that can advertise has only been around for five years, so our SaaS business has been around for nine. So it's it's different. Got it. And one works with publishers, one works works with with commerce companies. But we're connecting the two. So we're connecting the two, because Facebook and Instagram ads work really well, but they're really expensive. And we're and and I [15:58] >> every commerce company in the world will love ads that work in addition to Facebook and Instagram. So we're we're taking that power, and we're we're building it to rest the Internet. So we're and I think we we have advertising that's even better than Facebook advertising. So we're that that's that's what we're unleashing everywhere next year. [16:13] Ryan, last question. You've chosen to go down the venture path. You raised 75,000,000 to date. Your last round was 37,000,000 in 2018. You haven't raised since then. Anyone who knows what the venture path is like is gonna look at it and say, that feels like a negative signal. If they're growing as fast as Ryan is saying, someone would have preempted their next round at a valuation Ryan couldn't resist. Why haven't you raised money since 2018? [16:32] >> Actually, I mean, the first four years, I I I funded it myself at the beginning, and deal is the co founder. So this deal was fully funded by us. And then we took a very small, a million and a half venture round in in 2013, after we had a million ARR. So we went the first, like, we went the first five years on very, very little venture money. And some of that 75,000,000, we it's a combination of [16:51] >> equity and debt. So actually, put very little equity into the business. And and some [16:55] of How much of the 75,000,000 was debt? [16:57] >> Say it's about half and half, the debt. We've acquired five companies. So when you acquire companies, you don't want to sell equity. You don't want to dilute your company to acquire companies. So we've made some acquisitions, including an amazing one last year, and they've worked out really well, acquiring great people, sometimes technology people. And last year, we did both. So, that's really good for that, I think. Especially because you know there's going to be a particular [17:19] >> revenue stream that comes behind it. So, you don't want to just raise around to go do that. You might want to raise an account to do growth, and we are now, we're going to do a big one. But we we deployed very [17:28] How much are you raising right now? What are you targeting? [17:29] >> For a company of our size, say, north of a say, nine figures in well north of 9 figures in software scale, put it that way. It's a [17:38] So you're targeting a you're you're raising right now a north of a $100,000,000 round targeting that? [17:43] >> I would say raising around. Yeah. We're doing strategic financing because we we don't need to. We're we're we're good capitalized. But now it's you profitable? [17:53] >> Quarters some quarters is the case. This year, we actually did end up last year profitable, but this year, like, we we made a big R and D investments this year. And next year, it's really about expanding doing a lot of vertical and geographic expansion too. So you make those investments, and they they pay back very quickly. So now [18:08] we focus on raising nine figures right now, which would be like, basically, your series c. Do have a valuation you're targeting for that? I mean, can you get above a 1,500,000,000 valuation, you think? [18:16] >> I I think as a as a public company, we look to like, privately, it's like it's less as a public company, you want something that's like kind of in line with public stuff, especially you wanna look at your growth rate, I think we'll have more than a 50% growth rate next year. And maybe we would do 60 or 70, depending on what [18:31] we're you'd be valued at right now if you were public? [18:36] >> I think [18:38] >> we'd probably be in the eight to 10x next year's forward rev, maybe. Public and private is very different, so. Yeah, something like that. But it's a when when we're public, we're public, and that's that's a it's a good scoreboard. But, I mean, the reason I go public is is really just to attract talent. That's that's the main thing. It's like Yep. Yeah. No. I totally agree. Attract talent. [18:59] So just to be clear, though, because I don't wanna put out wrong. Right? You're you're looking at raising a strategic ground right now or not? [19:04] >> We're we're we're gonna do that. Yeah. So it's Very cool. We're gonna do that. And then and yeah. That's that's that's where you look to get the right partner. Someone's gonna be investing in looking at five year time horizon. Before your public company, say, year before that, you want someone who's looking at five year time horizon, wants to invest in your IPO, wants to recruit other great investors. People like, in our case, we're enterprise, so we [19:22] >> want introductions to the CEO of Target. Right? So we wanna we wanna co design products. We wanna do a lot of we we wanna do a lot of really cool in store products. So it's like, we we wanna do that. So you need to work at really senior levels in organizations. [19:35] Guys, there you have it. Ryan Urban, wunderkind.co. They passed a $100,000,000 in revenue last year. [19:41] >> Passedyoucanado.com. You could say.com. We're gonna flip that switch. [19:44] Okay. Dotcom. Wunderkind.com. Guys, they passed a million bucks in revenue. Call it twelve months in the business, raised a 1.5 seed. They announced scale to over a $100,000,000 in revenue. That was last year. Still now growing this year, 50% year over year. Looking to do strategic round now in the nine figures. We'll see what happens there, supporting over a thousand customers, advertisers, publishers, retailers, e commerce brands, you name it, they're there. Ryan Urban, thanks for taking [20:03] us Yeah. [20:04] >> And the only thing I never promote what my company does, but we are a great place to work. If you're in New York City, London, Indianapolis, or Austin, like, go to wunderkind.com, check our careers. If you're talented, that's why I do this stuff. Also, a lot of stuff will hire remote roles in in in The US for us, so check us out to Squad Up. That's [20:22] We'll link to that in the show notes. Squad Up at wunderkind.com. Ryan, thanks for taking the time, man. [20:27] >> Thanks, Nathan. [20:29] One more thing before you go. We have a brand new show every Thursday at 1PM central. It's called Shark Tank for SaaS. We call it deal or bust. One founder comes on, three hungry buyers, they try and do a deal live and the founder shares back end dashboards, their expenses, their revenue, ARPU CAC, LTV, you name it, they share it and the buyers try and make a deal live. It is fun to watch every Thursday 1PM [20:54] Central. Additionally, remember these recorded Founder interviews go live. We release them here on YouTube every day at 2PM Central. To make sure you don't miss any of that, make sure you click the subscribe button below here on YouTube, the big red button, and then click the little bell notification to make sure you get notifications when we do go live. I wouldn't want you to miss breaking news in the SaaS world, whether it's an acquisition, a big [21:17] fundraise, a big sale, a big profitability statement or something else. I don't want you to miss it. Additionally, if you wanna take this conversation deeper and further, we have by far the largest private Slack community for B2B SaaS founders. You want to get in there. We've probably talked about your tool if you're running a company or your firm if you're investing. You can go in there and quickly search and see what people are saying. Sign up [21:38] for that at nathanlatka.com/slack. In the meantime, I'm hanging out with you here on YouTube. I'll be in the comments for the next thirty minutes. Feel free to let me know what you thought about this episode. If you enjoyed it, click the thumbs up. We get a lot of haters that are mad at how aggressive I am on these shows, but I do it so that we can all learn. We have to counter those people. We got [21:58] to push them away. Click the thumbs up below to counter them and know that I appreciate your guys'support. Alright. I'll be in the comments. See you.

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 ryan urban he's the co-founder and ceo of bouncex a marketing technology solution that brings a logged in experience to logged out website visitors across devices under the company bouncex has been ranked number one from play retention and career development by computer world and named the best place to work by cranes and fortune ryan you ready to take us to the top yes all right you so maybe too yeah right we'll see so so first off thanks for letting us host the ceo format your spot you had a nice you had a nice big move so where are you now you're in the trade center correct gotta show people to view real quick turn turn the computer let them check it out you're gonna come with me there you go walk us around look at this view guys if you're not watching on youtube flick over to youtube i'm a hell of a view right good stuff so okay ryan so when you you know you've pivoted in terms of messaging i don't know if the product actually pivoted over over the past couple of years i mean how do you describe it today in kind of a sentence is that right a logged in experience to logged out visitors uh we we have all the messaging so we've been around about six and a half years and and we've we've always been focused on two simple things so i had an e-commerce background some of the other uh co-founders of bounce x i'm always focused on just driving revenue and improving experience so it's over time that the product mix kind of evolved so we started out we started doing uh email capturing being really good at that and everyone knows like our exit intense stuff uh then we're like hey we're clicking those emails let's uh let's do some triggers so we we rolled out like the product abandonment and we started doing some some uh some triggered email and doing that at scale and uh to scale triggers you need identification because less on ecommerce websites less than five percent of people logged in no one creates accounts anymore so it's like okay let's uh let's scale all the triggers with uh identification and um so yeah over time as as uh kind of the business of we uh our messaging has updated so it's basically we've always been doing the same thing we're uh we're on the side of commerce companies drive a lot of revenue and uh we improve experience so what's a lot of revenue ryan typically we're um any business we work with we're able to increase their revenue by say five to twenty percent um within within 90 days and it's usually more in the the 10 to 15 range and that that includes multi-billion dollar companies and the small company our savior company doing say 10 million dollars we're usually more if we have approved business 15 to 25 pretty quickly and uh normally we're uh we're typically a top three channel in some school analytics and oftentimes number one do your sales people have to fight for that attribution or is it crystal clear that's because they installed bouncex well it's uh the attribution is uh based on our client's analytics so it's and also when you you find over attribution when your product doesn't work when your product works it's like you feel it's like hey i'm growing wow yeah what's happening oh yeah so no it's like hey your analytics last click like we'll take last click is not the best way to measure things but you should be running control groups but we're okay cool just whatever is in your analytics you take a percent of the increase or you flat kind of sas model only we're we're uh we're a flat sas kind of shop uh but we we we'll typically do uh three or four month initial terms of pilots which is very unlike most of the market companies who require one or two year initial terms and based on um there'll be a price a monthly price there but we'll have a tiered pricing approach where based on how much increase in revenue it will roll it will automatically go into another 12-month agreement at a certain flat rate sas so i see based on basically our identification rate how we perform during that power period it could lock into a higher rate um so that's uh that's how it goes but it's flat rate tests so when you look at the cohort right now of all the customers you're surveying i mean help me understand like sweet spot an average customer is going to pay about what per month to use the tech or per year yeah there's a there's a median customer um i don't average is like a funky kind of thing so the cohorts i'd say there's there's three three chords so chord number one is the the the big ones the the megalodons as we call it here and those are the seven figure ones so those are the ones that are uh they used to pay us between one and one half million dollars a year now we're getting some that in the two to five million dollar range yeah so that's where we're moving on market but that cohort you call them your megadons they're all paying more than a million a year that's right okay um and then you have uh the bottom coal work which is our minimum is uh 72k here yeah so 6k a month is the company that we do in 5 mil 5 to 10 mil online um and uh so the cohort between paying us between 6k a month and i'd say like like 15k a month that's like that mid market cohort and then um then we have the enterprise core which is basically the 20k to like that 560k so you kind of have four mega lines and then enterprise middle small um i i say three there's like there's strategic and there's like the mega dogs the big strategic ones so yeah and those those really do move a business yeah now dude if you just add up the revenue from just your megalodons that does that make up more than caught 30 of your total revenue it's probably about that it's it's not heavily weighted which is good we we sign a high volume deals we're signing um almost 40 40 deals a quarter so and maybe we're doing two of the big ones a okay it's pretty pretty diverse okay good now two of those two of those big ones a quarter means you're you know new bookings per quarter then as well north of two million dollars at this point our new books in quarter is approaching 20 million yeah yeah way bigger uh okay very good now what's when you look at um when you look at this with something that's growing the fastest are you generally focusing on that that's er yeah yeah yeah when you're looking at what segments growing the fastest revenue the fastest is it that top tier or no are you seeing a lot of movement in the bottom tier and end so uh we should move to named accounts much quicker so we we mapped out our tam and after four thousand named accounts we we used to have uh sdrs and now we kind of have an elevated version that we're all we call it a bda bus development associate so they're prepared on a one-to-one basis with a with a new business rep and well they'll maybe eighty-five eighty percent of the time one rep and twenty percent of their time with another to spread it out a bit uh and they have they'll have like between 40 and 100 named accounts depending mid market will be more towards 100 uh strategically more towards 40 or 50. and whether those are clients or not their goal is to one like use all the resources we have amounts which is themselves the rep our marketing team our alliance team to break into the account at the appropriate level so there's something called we don't do leads we have something called a sales accepted opportunity okay it's the right company we will map out the org and we'll have like a group like three or four people that if the meeting is with that person and the meeting went a certain way then that's that's an approved kind of uh opportunity so we have very high standards on that so it's up to that that business associate to uh to to to get in there and also like post getting in there then it's when we're an active opportunity it's it's their their job to move on the org uh be on calls and meetings kind of take notes help facilitate the process so it's it's like a farming system for our sales team as opposed to like here's some sdrs our cold emailing and called the email email templates and hands over sales it's not that it's a very cohesive unit so as we do that move to name accounts we are just it's not andor it's an end-to-end situation of mid-market's growing enterprise is growing strategies growing mega down's growing um and we're not at the point where we're a default setting there's there's a point in like a sas company where like say salesforce is your crm there there's the default and for email and for ecommerce company exact target was default for a while demandware which both these are salesforce is kind of default if you're a mid-market e-commerce company shop advisor defaults so um so for us uh we are for identifying default but we need to make kind of once one at energy resolution a and a really established channel and that once that channel is a default thing then we're gonna really start to see some some some uh special growth you were serving 250 paid customers back in 2016. what do you know today um we're probably on about a thousand websites so uh is that paid customers though yes it is so okay yeah we don't do anything yeah so okay so thousand paid so i like this approach you've taken right so you essentially said okay i'm gonna go look at all the e-commerce brands with more than x amount of gmv based off some you probably scraped got data from somewhere obviously legally but scraped it whatever paid for it and then you map out the four thousand accounts and you say we want to get all these four thousand accounts you're out a thousand of them right now is that actually reps and bdas to all those accounts and then our marketing and we just have there's there's incentives everywhere to break into those accounts at the right levels so and then we we have some other vertical so we do a little bit of travel system vertical and we have a separate publishing which we we've completely broke out his own business unit and have have had that team completely focused on its own thing and the uk is also it gets treated as own complete business those are that's been really effective for us so it's on sales orders on accounts or it's on marketing so it's and um our our publisher business is growing three actually every year that'll probably do 25 million itself this year so yeah publisher business is like is like forbes what's up yeah we help publish a lot of ways so help them grow their email us help them drive descriptions we'll help them with uh with creating new ad real estate so uh kind of redefining what uh what an ad should be so it's we just take the approach of like hey if we're going to be in the e-commerce world we're just going to be a true partner and be on their side and understand where their business needs and it turns out it's really simple they just need revenue growth and they want to improve customer experience so everything there's just really focuses on that and that only so that then you don't want it doing cool stuff you don't want to rolling out different features it has to hit a certain increase in revenue for us press the ship a product or feature it has to drive increase revenue at least two or three percent depending on which product it is and for example like say retargeting critero's whole business um which they're a multi-millionaire company they only increase for about a half percent so for us even to have a product extension which basically feature it has to be forex better in korea's whole business for us to show something and it has to improve experience too it's not just hey let's go run more sales or send more emails you talk about cri teo correct curtail yeah yeah now you head back i i know you chose not to go the boots dropped right on this thing how much total capital have you raised to date no i i funded it myself at the beginning and then the first year and a half it was funded by the co-founders so yeah and if you were going to join as a co-founder i made you put in even 40k like you had to put in 40k if you're gonna so all the co-founders put in 40k no some put a lot more one put in 190. how many of you are there i'll probably put in 350 to 500 depending how i look at it and um there's how many are you are there there was four four okay four co-founders so all together how much total did you guys all put in like a million two million no that's like um six hundred ago six hundred grand okay now then we took then after we got to about um 70k and mrr so when we got to about the uh a million dollar ar point then we and we had good pipeline then we raised a bit we only raised this is 2013 uh mid-2013 we only raised a million half bucks when we could easily raise like four or five then and so uh i know we basically went the first almost four years on that million half venture money raised we did take a little venture that too uh like some mezda from wti that was great now we were silicon valley bank what year was that the wpi deal um i thought it was probably the next w4 2014 and we just used that to we've we've acquired four companies so some that's used to fund some acquisitions uh we how much leverage can you put to that i mean can you go buy a company if the deal price is 10 million in cash can you get away with putting up a million in equity in the rest in debt you could leverage about uh depending on the strength of your business somewhere between point eight and and one point two times your your error and where you can flex up a little more oh wait of your personal are the company you're buying your cup your personal ar um and then you they're gonna look at the company buying how much money you're losing et cetera so um you don't want to be too lovered but it's uh it's it's really under underrated and you give up min it's the terms are the market's really good for terms you can like right now are you talking like two to six percent kind of interest rate somewhere in that range um when you're there there's gonna be some that are six percent some that are going to be more in the the 10 range if it's if it's uh if you're looking at like no interest for a certain period of time or very low warrant coverage so you might give up like a point about creativity so but if you so um the ones that are taking a little equity they might um or they're say there's no covenants or there's minimal covenants uh so very very very uh kind of friendly term you might be paying more than 10 range but that's still super cheap so then you can raise your paid off or you can keep like rolling if you like if you're doing well so yep you mentioned another venture around in 2017 what was that round for um i i i don't think the the veteran questions aren't really the right questions it's it's when it's when you feel like you that product market fit or you have some marketing channels you can really explode on that's the right time to do it well no i mean by the way ryan i asked because there i mean there are two very different models some people bootstrap the whole time sometimes you get on a vc track and a vc track is just very different right so didn't you raise in 2018 didn't you raise 37 million from battery uh so a good good amount of that one in the balance sheet but not all of that so something some that you use to like buy out some like early investors so uh we we put we put less than 30 on that but we'll end the year with what do you mean you put less than 30 on that well we'll put less we put less than 30 into the business some went out to buy some have bought out some um or just there's some liquidity for some earlier earlier initial yeah so eight million eight million went to secondary early founders early investors and about less than 30 went to the balance sheet that's right and and we're um our cash balance is going up now so we're we're close to probability but we're cash flow positive so we'll bond a year with a good amount of cash so not 30 million but a lot of cash so now we're in a position where we don't need to raise money but like we'll like we're we're coming off our two best quarters ever and now now we uh we we found some places we could really hit the gas and yeah now you did you did another 30 million dollar on a silicon valley bank a year prior correct that was equity um that was a that was a different deadline it was a little less um so someone said silicon valley someone was with someone else then we that's something that we have the option to pull pull some we want so so that wasn't actual dilutive that was essentially like a term like revolver or something um some of those terms some some was based on some space in there are so uh altogether we probably uh have about 60 into uh into the biz and we and then you minus your the cash from balance sheet and we've we've probably deployed somewhere in the 30s got it so you still have like basically 30 cash in the bank you've raised 16 equity and 30 has been spent to grow the business um uh some some within within 20 of that stuff and let's assume that we'll we'll end the year well north of 100 million um are you past that right now or you still need a three months to break that it depends how your counter publisher business so how do you measure it um if you're just looking at clean e-commerce sas we're basically there but um if you count our publisher business and uh then we're we will be well that's them why would you not count the publisher business it's uh it's you could it's just it's if you look at the net revenue that it's it's a it's a nuanced thing so uh depends how how the way gap looks at the revenue from that it changes all the time so um yeah i i look at it how's it say i would say i would be i would be counting every dollar if it's cash coming in the bank i'm counting it but we're this is what we're looking at uh we're looking to basically to have a strong ipo some companies wait till like they're doing 3 400 million some companies go at like 100 million um what we'll probably do is we want to get our net revenue retention which i hate the word i don't use the retention years or client growth but all right our net client growth uh i want that overall to be above one 125. what's it now 130. um it's um it's one of one of the issues we had is we've ran out of stuff to sell our clients we sold through all the things seriously so and ship special products takes like good teams so we're we're uh we're in alphas with two really really special products and uh we're gonna we're gonna acquire something great we could put our id tech on top of it but what's it now so you wanna get 125 what do you get now um it's it's it's not that i think we can we're we we want to we want to improve by 20 i'll put it out okay so you're above 100 you're above 100 though right now um the some cohorts were were much higher than that and some calls were lower so it's um as you move down market your those the numbers are the numbers are lower so that's and also depends on if like we're say if we're partnering with a marketing cloud and we're sending our stuff through uh if we're if we have our product suites all through so depending on the goal works we know the course where we're right now 130 140 and one you want to get more of those cohorts and two like ship more products for those sports so we're just in a course strategy perspective you can just the way that i look at it and this is kind of important to say so you could take your same product move on market you could take your same product with down market you could take the same product with other verticals you could take your your same product and move to other geos right you can do new products to the same to the same market that you're selling right now or you can do new products to new markets anyone those new products new markets is a complete idiot so the route that we've taken and and all these all these things are quite productive actually the most product work is moving down market and it's the worst so we've just taken approach that hey we're going to keep it simple we're going to take our same product move up market we express a little more api approach you always do that you always move on market and you focus your product movement and then we're shipping new products to the same market so our our sweet spot is e-commerce companies doing between five million and a billion dollars in your revenue so the stuff we're shipping now is really focused on companies doing a billion to to 40 billion in revenue online and new products to the same work so and super super narrowly focused on that stuff and when we ship a product it needs to be oh we typically do things that are new to market um but it has to be so bummed up best in class like just so what other metrics do you want to hit besides 125 net revenue retention before you've started an ipa well um we want to have you unpredictable growth so there's this magic number stuff i the difference between growing 40 and 70 is a huge huge there's a could be a huge difference multiple right now growth is looked at as everything um but uh i want and your growth needs to be predictable so that we're flat rate sas flat rates has kind of lowest predictability the network retention will help with predictability because then we know hey if we're say had 200 in an aor and our network session 125 like boom we're going to be at um 240 the next year with no new customers well no new customers depends what's up renewal so yes with with no no new customers here so uh you want to have that and then the other i would recommend only doing usage-based pricing or having shipping products that support usage-based pricing so for us that's going to be some apis service platform as a service stuff some stuff that's maybe an active contact here so a little more of a more kettle approach you can't just make that up and your entry has to support that so make sure when you're shipping products or you're going you're going to acquire a product that it's it's something that supports usage-based pricing that like shopify is at almost a 40 billion on market app they charge a platform fee but transaction fees so as businesses grow they get the benefit of that where where our core business our customers get the benefit of locking it at a rate the rate is really high and it's bagging into a great return on spend number but if their business is double they're just getting much more roi so and that's was helpful in the early days for us to grow but we need other stuff that like hey as our clients grow that there's going to be a step up as well and what's your overall i mean so if you break 100 million in error this year where were you a year ago um well let's talk about where where we want to be i i weaken ipo at like 40 growth um which we're it's that's it growth is something that you do have a lot of control dictating so that's like we're we're cash flow positive so um at the point where i feel really comfortable with product market fit on some of the new stuff we have an acquisition we're gonna make we're probably gonna make our first like maybe not a nine-figure acquisition but an acquisition in the mid-eights uh probably somewhere a company that companies we're looking at that have between 75 and 150 people we're still rolling up a lot of more tech so you're talking like 10 and 30 million an ar-ish kind of range between 10 and 40. yep yeah yeah and it's it's it's going to be it's going to be strategic attack not opportunistic stuff so stuff where we put our id tech on top of and just almost use it as a marketing channel too where we can then go in and like go to all their customers and upsell our stuff in acquisition is a hell of a marketing channel yeah you know you didn't did you do any acquisitions last year uh we did one it wasn't announced okay it was yes i mean were you less than you said you wanted 40 years or your growth i mean were you less than 40 years over your growth the past 12 months um it depends where you look at it we're probably we'll probably finish here more than that um you know i guess but we're it's you have quarters you you have different goals q4 q1 it's that that was the goal you got to get the ships you got to get the ships to for us it's like having a scalable sales team you gotta have the product market in your sales team now we have we we always had like some real strong athletes great performers but like getting that enterprise mid market team to a place where it's a machine where you got the right people in the right process and like we we got that down now so we know we can like hit the gas there in a marketing standpoint um for our top named accounts say our top even top 500 name accounts like we want to go into the ceo level so it's like how do you create these these experiences where co will come out so we just spent about 200k we we rented a private suite of the us open finals we uh we we choppered we choppered these cos in to our basically where sweet was and uh and we also had other ceos out and like so they got to kind of meet some other like ceos or or cmos of big companies they got to go to the dow final at a private suite chopper so like you do and and we only have the top people from our company there so it's an amazing experience and then that way you can get your clients out that's a good good idea to get some of your prospects who were in a in active pipeline out and then new prospects so it's so doing things like that it might cost 200k but it can really scale there's a 500k version of that we have john macron your booth review hanging out with you right so there's so we want to do stuff next year we call the bill clinton budget so have these like million dollar experiences if you want to get the co target out it's like hey like hey we're gonna go get brooklyn to hang out with us but he's gonna instead of like giving a talk he's gonna play the saxophone and he's gonna be in a band with like boys to men and then when mike tyson like literally rents a ring and you get punched in the face by mike tyson yeah yeah i think a child works alone dude and and you're gonna pay us for it that's good hey look yeah so it's like take what cameo does cameo a hundred dollars you get a celebrity to this you go like create a you we want to create a great experience for the celebrities and and presidents but to hang out with like ceos yeah so and that's that's that's where we're gonna do marketing next year ryan we're running out of time here team size today how many people um it's about 400 how many engineers uh we're we've what we've been doing as a business general is um it's been a lesson approach where we're doing smaller focused teams of much more senior teams so as the business evolved we've been hiring way more senior people and putting them in smaller teams so our end team is shipping fast and ever multiply 70 people 70. okay and how many reps are actually carrying a quota sales reps um that's on ramp quarter is much less um that's probably around 20. so it's not that much what about even even an unramped unwrapped um the 40 range 40 range interesting okay very cool man um let's uh let's wrap up here with the famous five number one favorite business book [Music] i it's not a business book the the book that's impacted me the most is uh recently is the the but besides uh andy grove andy grove's savage so andy grove that's easily the best book of all time and the robbers on the uh any danny ireland book is amazing it's like you really get some episode the book that uh has the most impact on me in the last year is the howard stern interviews so i'm sure everyone's watched howard stern reading a transcript of these interviews the one with madonna especially had some impact on me um it's it's like it just changed my mindset it's like people thought like not being a rebel like she was doing things to get a rise of people she was just doing what she thought was right she's always doing what was right and just reading you have the the most special people on the planet and getting read a transcript of an internet heart stern was like getting in the mindset of these special people like lady gaga madonna everybody it was it's it's a donald trump was on their sixth time so it's that was really cool so that was uh that was the best one number two is there a ceo you're following or studying um yeah i've been really following the adam newman stuff i i feel bad um he shouldn't he should not have stepped down yeah i would have thought number three is their favorite online tool you have for building your company beside your own yeah and look like it's it's a just give the right answer elon musk is the most special person uh to exist on a planet over the last 200 years so hands down and no one should ever talk about that guy um let's let's just let's just state the facts here he's no one's doing special things like that and i really appreciate larry allison's back in the helm and getting like trying to build a great product like he's larry ellison's special guy too so you're talking to oracle yeah would you by the way if someone offered you a billion dollars to take your company out before you ipo would you take it okay and when do you think you're an ipa i think it's next year you file when when we have those metrics when we have product market fit on some of the new things where we're usage-based testing so you think you can hit 40 percent of your growth next year and you want to hit that before you really next year i was going to smoke that um so i really want to be at i might go i i don't want to be at less than 50 growth at ibo and uh i also prefer my ebit to not be more than negative 10 yeah i would prefer to be a 65 70 growth i want to be an accelerating growth okay very good uh what's your situation married single kiddos awesome hold on um people read so many books so stop reading books um stop listening to podcasts people listen to much if you listen to something if you read something you got to take action immediately that's it but people read way too much yeah that's great it's stop stop reading books just go do so ryan situation married single kiddos um i'm i'm an independent so independent good no kids running around i i already have the best kids i have a lot of them working so and how old are you...