Xpovi Revenue, Valuation & Funding (2024)

hey folks my guest today is mostafa hisham he's the co-founder and cto of expovi he graduated from arab academy for science and technology majoring in electronics and communication engineering since then he acquired multiple certificates in software engineering and ai and has several years of experience through working in companies such as ericsson and lucidia in the fields of data analytics and ai he developed xpoby relying on the latest technologies in cybersecurity and machine learning it's an enterprise robotic advisory firm all right must stop while you're ready to take us to the top sure all right so when i hear advisory i hear consulting is this a piece of software you've built or is it pure consulting yes it's actually our software it's based on the traditional concept of financial consulting which is uh what we aim to automate through expov our platform that we provide the financial modeling and business planning which usually or traditionally is done through physical contact where you try to pitch sit with an analytic or with an investment analyst where you try to show him uh illustrate your business as much as you can so he can build for you your financial model or financial business plan so it takes uh i can say to a lot of time and money that it's not always available for startups or entrepreneurs when they're founding their business because you're uh always budget efficient when you're starting and you're allocating your resources so what we're providing is we're automating uh this whole process most often sorry can you just be very specific can you tell me a customer that's paying you today and what they're paying for okay for sure yeah so our customer is paying for uh building his financial business sorry can you name a customer that's currently paying you uh okay first of all we're not a subscription based we're one time purchase okay so it's paying us it's for just uh one time payment so uh well when we can one we can name is uh tgs okay tgs and what does tgs do yes they are how do you say it uh they provide uh are you talking about the energy company energy data no no no they uh deliver uh uh grocery yeah grocery delivery shop or something like that and so and so what do they they paid you one time what did they pay you for uh they came for the business plan okay so you generate a business yes business plan tailored for them and and how do you grow the business if these people are only paying you once and then leaving i mean you have to sign up new customers every month because you're always starting from zero yes okay so uh first of all we uh we launched last month okay and the approach was is that our product uh uh can be used just for one time because we're aiming at uh startups and our idea stage startups actually okay so uh usually business plans should be used or uh must be used actually by enterprises on day to day basis because you're updating how you're operating your business but to do that we have to uh not enhance our product but to add ons a lot of stuff that will be needed for the founders to be using our product on daily basis and month to month okay so first of all we we launched with the business model of uh transactional-based one-time payment and how many have purchased the one time uh for now 20. 20. 2-0 purchased one time and that one time purchase was for how much uh 249. oh what's going on there youtube good to see you guys now imagine this you love watching these interviews with sas founders but imagine if we took all of the valuation data out from over 2870 interviews i've done manually saves you a lot of time well we've done this we've built it into the beautiful interface inside of founder path check this out i'll show you how you can access this in a second but you log in you connect your stripe account you see your valuation real time you can see what it changed over the past 88 days and even set goals for valuation this year now the secret evaluation is there's many different ways to value a sas business so the reason you're going to see three or four different valuations inside of your frowner path dashboard this is all free by the way is because depending on who's doing the buying of your sas company you're going to get a different valuation a vc is going to pay a different valuation private equity firm is different if you're going to do a minority sale that's different and if you sell the whole business that's a different valuation you can see all those when i hover over here right so the teal is what a vc would pay yellow is what private equity and red is if you sold the whole thing outright now what's cool about this is this is not built off random data again you guys hear these interviews on youtube all these datas are built from real time valuation data points founders share with us on the show so traction 1.2 million seed round 3.7 raised they sold 22 to their business go in here and filter by the event maybe you only want to see companies that have sold the whole business well here are a bunch that have been acquired the valuation and the multiple maybe you're going out right now and you're raising your seed round well go in here and look at all this recent seed deals that went down what they raised what valuation they raised at and what percent that they sold there's never been a larger data set of sas valuations than what you can get now inside of founderpath and we're thrilled to bring it to you all right we're going to go back to the youtube video here in a second but if you want to check this tool out if you want to jump in and sign up you can check it out for free to get your valuation at this link this link founderpath.com forward slash products forward slash evaluations or if you go to founderpath.com and hover over products click on get your valuation here and go ahead and sign up to give it a whirl again all that valuation data live right inside the platform i hope to see you there all right let's jump back into the interview and so are any of them paying anything else or no they're all done uh no they're all done yes because they pay on the checkout after finishing the questionnaire the the concept that we've developed is that we've made around 30 questions questionnaire that is very easy to understand and answer and through these answers we instantly generate your business plan and it's instantly delivered to you where you can use it with uh also an add-on and user manual that helps you navigate this business plan because it's not uh for sure that you are uh how do you say excel efficient to navigate uh how to navigate the business plan so the deliverable is you're giving them a big excel file uh yes exactly okay and so how many of these do you think you can sell and like how much revenue do you think you can do this here okay we can sell actually a lot because uh in egypt okay with egypt at least so in egypt there is around 3.9 million enterprises from small to smes and large enterprises okay so the market is actually huge and it's growing year by year with an exceptional rate exponential rate sorry around 60k per year we're aiming at this year at serving around uh four to five hundred uh four to five hundred yes by the end of the year but that's i mean you have three people on the team that's that's too small business 500 paying 249 each is 120 000 in revenue there's three of you working at the company today that's that's not enough no we're actually three founders today okay we are three founders but we started hiring and the team is actually uh we are eight now and that's about i'm saying that's a bad thing you're only generating i know what you're saying even yeah yeah but what i want to stress it's that uh it takes time because uh we have to actually educate people about our service and how essential it is uh for you as a founder to have a good model and a good business plan model and forecast for your upcoming five years because uh if you look it up actually uh from the three top reasons that startup fails uh number three is uh not having a financial uh business model and okay yeah but i can also say every single company that has failed probably also had a financial model they just couldn't execute i just i guess i don't understand the focus on this like why would you sell a something that only happens once your maximum ltv from a customer is 250 bucks why why would you pay your energy for selling yes we're selling at a huge actual discount like if you actually want to make a business plan it will cost you thousands but we but that's the traditional way how many of us have been sold we're aiming at volume no no no i'm saying that we are automating the process if you are making uh there is no other platform that provides what we provide okay so that's why well maybe most of maybe there's a reason for that maybe it's because it's a bad business no because i think the the main reason was that it's not executable not that the business model is not like i mean let me just do this when i launched my company i never said you know what i wish i had a great business plan to make sure i don't fail never once did that cross my mind right like that is not the success indicator of a business it's can you go execute so i guess i just don't understand i don't know this is a huge need and i also don't understand what like how do you grow this because you can only sell it one time for 249 bucks okay within the next couple of months we're actually transferring to be a subscription based but to do that we have to uh do a few iterations on the current product to be actually usable on day-to-day basis so what do you think that product will look like the one where you can charge monthly for how it will look like it will be the same process okay of answering a questionnaire and generating your business plan but your business plan will be on the platform and a dashboard where you can access and edit on daily basis your number and updates your number and you can depending on let's say you want to pitch your uh your your numbers to an investor on to a vc or engine investors so you want to share what you uh what your numbers are with them so you send them an invite to your company profile on expo to show them these numbers okay uh so second of all you have to visualize your data right now it will give you the excel sheet where you can see all your numbers but to visualize this data and to actually be able to download reports depending on what you need from the business model so let's say your marketing budget or your marketing plan so you can download this uh report so it's not only used by you as a founder but let's say for your finance team mustafa i understand it it's just they're a fin mark i mean there are hundreds of companies that finmark.com pride just was bought by brex for 90 million bucks they do this i mean what you're basically saying is like it's a financial model give it to your board give it to your marketing team to plan cac like what's unique about this what's your special sauce generating and ensuring the quality of what you're getting because it's it doesn't depend on the quality of the use what i'm not telling you to enter your data so that i can present it to you i'm only telling you to answer simple questions so that i can provide you with this date provides you with actually the data that you need like you said i didn't cross your mind that i need a good business plan it's always about execution and that's true it always comes down to the founders themselves or the entrepreneur but you have to have the right guide and then the execution is definitely on founders but having a great road map on where we're going and how to allocate these resources i think it's more than essential and succeeding with your business i mean look i just don't think that's actually a secret sauce i think your secret sauce if you start to like take off is because you're focused on egypt and companies like fin mark and pry don't exist in egypt yet and so if you can focus on getting egypt founders signed up or egyptian founders signed up for your product and do this maybe that's your wedge and you ultimately pivot to something else that's more defendable with a bigger moat something more interesting and compelling okay well actually what we're trying to do after that that's our first model of course generating a pitch deck that will be something uh goes without saying as a complementary uh product but it's also a one-time thing you know you do that once every 18 months if you decide to raise sure and when you decide to raise if you decide to raise most never raise if you decide to raise okay but why do the most never raise because they're out of money and they burn too much they have too many people on their team okay so managing your cash flow is one of the top reasons of also failing your uh of businesses this is one of the top three and having a financial model that executable yeah but how are you gonna be better than quickbooks why how why would people rip out their whole system and use your tool over quickbooks there's plenty of tools that do this already okay quickbooks is an uh uh account and software it doesn't yeah but that's what we use to manage our cash flow which is the problem you said you're trying to solve okay but how will you allocate your resources on your hiring or your marketing plan or your revenues and costs this is not something that's provided with any of the companies that you've mentioned right now and it's someone stopped well i'm just telling you i'm just i'm prepping you for what the comments on this are gonna say everyone's gonna say what i've just said which is this exists like mostafa has not said anything that's proprietary what i thought you were going to say going into this interview because your background is machine learning and data science was something that was like heavy heavy on technical stuff but what you've told me is it's a survey people fill out you're giving back an excel model you haven't mentioned data like machine learning or ai or or data science or anything since the intro so i'm surprised you haven't talked about that okay because this definitely comes after our launching phase because we need our uh because having data analytics and using machine learnings we need our data points that's provided by our actual users and as i told you just this is the plan going on but we just launched last month so we don't have enough data actually to do like uh when you're answering i understand i understand yeah you have to build your need yes we need to build our own data to to do this uh yeah but you're never gonna have more data than quickbooks right like you you're never gonna have all these other people have a flywheel here already so it's like you either have to have a genius arbitrage mousetrap to get data faster than any incumbents so that you can train your models better than them right or you're not going to compete with on machine learning and ai and data science yes for sure yes yes sure but that's what the need for the product at least here in egypt will uh make us capable of doing something okay well we'll see what happens this is great um are you bootstrapped or have you guys raised uh yes we've raised how much did you guys raise uh 300 thousand dollars okay pre-seed and and what was that at like a five million cap or something uh three three million and was that who were the investors or these family and friends or yeah yeah engine investors mainly okay very cool well i'm certainly rooting for you i i love that you're sort of using the one-time fee to learn about what you could build and then to drive like a monthly recurring fee i'd love for you to come back on in a year give us an update but in the meantime go ahead you want to say something yeah i don't know i want to thank you so much uh and i just want to add one more thing uh very quick that when we launched we knew that uh we need to have a lot of improvements and to have our subscription-based platform what we've decided to launch because we've always said that having an mvp and actually going live with the product will give us real feedback from real users and we are very agile to move in another way that's more how the market can lose i love that i love that you're getting something out there and charging for it i think that's fantastic it'll be fun to see how you pivot and grow over time in the meantime though let's wrap up here with the famous five number one mustafa what's your favorite business book favorite business book uh definitely uh grinding out which is by ray crook about the founding of mcdonald's and how they managed to automate the food industry number two is there a ceo you're following or studying uh ceo um i think mainly jeff bezos number three uh what's your favorite online tool for building expovie um for sure number four how many hours you sleep to get every night oh uh i always aim for eight but it uh always comes down to i think from six to seven okay and what's your situation married single kids uh i'm engaged ah congratulations no kids no okay and how old how old are you i'm thirty thirty last question something you wish you knew when you were twenty something you wish you knew when you were twenty uh that i think that uh sometimes things just don't go according to plan guys there you have it expobee.com right now they're selling a one-time solution for 249 bucks to build your business plan over the long term they're using that revenue and those customers to learn about what they can do from a machine learning and data science perspective to help you manage that business plan over time manage your cash flows allocate expenses we'll see if they can pivot into pure play sas model as they continue to grow but again learning quickly now with their mvp mostafa thanks for taking us to the top thank you one more thing before you go we have a brand new show 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