How OrgaNice Reached $4.8K ARR and 5 Paying Customers via the Slack App Exchange (Interview with CEO Andrew Fan)

Introduction and Agency Background

Nathan Latka

00:00Guys, when Andrew was 24, this was back in 2012, he launched his own agency and started doing consulting work. Today, he charges on average $20.30, $40,000 per project. And last year did quote several millions in revenue, call it 3,000,000 in revenue. But what we talked about today was how he's launching his individual SaaS applications like organice. App on the Slack app exchange, which helps you bring your org chart into your Slack channel. If you're a smaller

00:24team, that's maybe too early for the enterprise level org charts. He's just now got his first paying customers on that product. 55 engineers up at the holding co level, 1.5 of which we'll call it a person and a half working on the spin off for Organize App. We'll see what he does next. Hey, folks. My guest today is Andrew Fan. He is building a company called organice, which helps founders and people ops teams of growing Slack

00:46heavy organizations by bringing the core of their HR tools into Slack. Andrew, you ready to take us to the top?

Andrew Fan

00:53>> Hey, guys. Nice to be here.

What OrgaNice Does and Who It Serves

Nathan Latka

00:56We're good. We're glad we're thrilled to have you. From what I understand that you have a a company called where you work on side projects, and one of the side projects that has taken off is this one called organice, that's nice.app. Tell me about a customer that pays for organice app.

Andrew Fan

01:12>> Yeah. So we just started recently. The application was launched this March. And currently, we have a bunch of paying users and a bunch of users which I hope you'll convert to the paid users soon. If I have to

01:33>> describe an average customer, I would say that this is an SMB company which uses Slack a lot and which which is probably growing and which is too small to start using enterprise level HR tools. So

First Paying Customers and Pricing

Nathan Latka

01:56And and when you say when you say lots of paying customers, how many paying customers?

Andrew Fan

02:00>> Not not not a lot. Currently, have five.

Nathan Latka

02:03That's great. And what what do you charge per month on average?

Andrew Fan

02:08>> We charge per users in their workspace.

Nathan Latka

02:13Okay. And how much?

Andrew Fan

02:15>> $1. $1 per user if you pay annually or 1.25 per user if you pay monthly.

Nathan Latka

02:24Okay. So a dollar per user per seat per month or dollar 25. And then how many how many seats do the 20 the the five customers currently have?

MRR and Seat Count

Andrew Fan

02:35>> In total, they have somewhere near 400 seats. So our MRR is somewhere near four four hundred depending on the month because That's it jumps depending on the number of users.

Nathan Latka

02:49Well, so why does it jump? I mean, if they use your tool and pay for it and get addicted, they shouldn't churn at all. Why does it jump?

Why Revenue Grows Over Time

Andrew Fan

02:56>> It it jump to the positive direction. I mean, people those companies, they are growing because yeah. Usually, you need to visualize your organization if you want to to to grow. Because if you are shrinking, it does not make sense to visualize your existing team. So I would say that revenue is growing.

Nathan Latka

03:20And help me understand, Andrew, how you got these first five customers.

How the First Customers Were Acquired via Slack App Exchange

Andrew Fan

03:25>> Yeah. So this is not our first product which we launched on top of Slack. And what we realized is that Slack is a perfect place to start your, like, first, I would say, bootstrap small business because once you release something for Slack, you can get into their marketplace. And basically, this is a free marketing tool for you, and this is how we got our first client. So we just released our applications there. We wrote description for

04:04>> this application where we mentioned some words like org chart, org tree, and our first customer basically found us using marketplace using this search on on the stake marketplace.

Nathan Latka

04:19Oh, what's going on there, YouTube? Good to see you guys. Now imagine this. You love watching these interviews with SaaS founders. But imagine if we took all of the valuation data out from over 2,807 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 Founderpath. Check this out. I'll show you how you can access this in a second, but you log in, you connect

04:42your Stripe account, you see your valuation real time, you can see what it changed over the past eighty eight days and even set goals for valuation this year. Now the secret evaluation is there's many different ways to value a SaaS business. So the reason you're gonna see three or four different valuations inside of your Founderpath dashboard, this is all free by the way, is because depending on who's doing the buying of your SaaS company, you're gonna

05:06get a different valuation. A VC is gonna pay a different valuation, Private equity firm is different. If you're gonna 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

05:28not built off random data. Again, you guys hear these interviews on YouTube. All these datas are built from real time valuation data points founder share with us on the show. So traction 1,200,000 seed round 3.7 raise. They sold 22% of their business. Go in here and filter by the event. Maybe you only wanna 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

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Optimizing the Slack Marketplace Listing

Nathan Latka

06:42the interview. I wanna go deep on how you optimize for Slack because I'm on the listing right now. You know, Slack does not use, like, ratings. So it's not like you can get to the top of a list if you get a lot of five star ratings, but what you have in your description are bold words like org chart, birthday, work anniversary, manage PTO. How did you know what keywords to target, and does making them bold

07:02actually get you more traffic from Slack?

Andrew Fan

07:06>> So Slack marketplace team is not huge, and the algorithms on how they react certain application are not that sophisticated in comparison to, like, Apple Store or Google Store. So this is only my guess, like and my guess is based on observation because we have two other applications in their marketplace. So they rely on the application usage. So for example, if you if you found some customers which are using you do a lot, They probably gonna rank

07:49>> you higher.

Nathan Latka

07:51So, Andrew, they're they're tracking how many people click that green add to Slack button. So for you guys, each last month, how many people downloaded Slack on the Slack back directory?

Download Volume and Keyword Strategy

Andrew Fan

08:01>> Not a lot. Maybe

08:04>> 25.

08:08>> Yeah. I I say not a lot because for our another tool, we get, like, twenty, thirty downloads per day. That tool is

08:17>> more it it it it's less it's less in in terms of, like, a business. However, it's it it it's it has, like, good keywords, good names, so that's why people install it. So for organice, we basically try we we try to highlight our main feature, which is, like, building org org chart. And I guess most of the clients, they they find us by typing org plus something in the in the search bar. Because if you do

08:49>> this, probably you will see us in the top. And basically, the number of results won't be won't be huge, probably like like five, ten results in total.

Nathan Latka

08:59So is it fair to say that all of your trialing customers and paid customers today have come from the Slack app exchange?

Andrew Fan

09:06>> Yes. Exactly. We we are only planning to start doing other types of marketing. We are currently working on our website. We plan to launch,

09:19>> like, a small Reddit campaign because Reddit has a good subreddit for, like, users. It's it's it's, like, it's pretty crowded, I would say.

Nathan Latka

09:31Understood. Other applications.

09:34How do you figure out, like, org chart by deal ranks really high for the search term org chart? That's d e e l. Deals, obviously, using this to onboard people to their full HR sort of management platform. Do you have any way, any tools that use to sort of know how many downloads other apps get on the Slack app exchange?

Andrew Fan

09:53>> Unfortunately, it's not possible. I I think that this is the most popular question to the marketplace team, like, when you introduce your analytics so developers can basically, like, work with it and improve the description or whatever to appear higher.

Activation Metrics and Trial Conversion

Nathan Latka

10:16Yep. Yep. Exactly. Okay. Interesting. What do you have to do to convert a trialing customer into a paid account? What activation metrics do you look for?

Andrew Fan

10:27>> So

10:29>> our tool, basically, it once you add it to your Slack space and once you configure, like, what fields you want to show on your org chart, The tool starts asking people, please provide me this information and that information. And basically, what we are looking at is, like, two metrics. The first one is how many people reply to the bot because there is a certain threshold after which and we'll see that there is an engagement with the

11:03>> tool and like more and more people appear on the org chart. And the second method we look is whether they activated other daily features and, like, birthday tracking or time off tracking. Because, like, whether the org chart is a good kind of, like, reason to install the bot, you want to use your org chart every day because you just set up it. And probably the next time you look at it Yep. Maybe, like it's it's all

11:38>> kind of like a daily

Nathan Latka

11:41Understood, Andrew. How have you how have you capitalized the business today? Have you raised capital or bootstrapped?

Andrew Fan

11:48>> No. It's fully bootstrapped as we have other business. We have available developers. So yeah.

Nathan Latka

11:55So how many how many folks are full time just on just on organice?

Andrew Fan

12:02>> Full time, I would say one and a half. One and a half. And the rest? They're joining and they're leaving depending on their lot of other projects.

Bootstrapped Model and Team Structure

Nathan Latka

12:11So explain me how it works. You've got which is the holding company of organice. How many developers are full time up at the holding company level?

Andrew Fan

12:19>> We have somewhere near 55 people and maybe

Nathan Latka

12:2380 full time.

Andrew Fan

12:25>> Yeah. Yeah. And it's 50 and maybe, like, 80% of them are developers. The rest are involved in the creations.

Nathan Latka

12:34Andrew, you must be making a lot of money somewhere because it's not cheap to pay 55 people full time.

Andrew Fan

12:42>> Not not a lot of money, but it's enough to to pay the bills and

Nathan Latka

12:48Well, where are you making money, though? Or or organice does 400 per month. The other one you said, is the other one free?

Andrew Fan

12:56>> No. Other applications, they are also generating some money, but, basically, we are doing consulting for bigger companies. Oh. And this is how we earn money. So our main business right now is, like, consulting business.

Holding Company and Consulting Business

Nathan Latka

13:14I see. I see. So what will you charge a brand to build, you know, a custom slap Slack application for them?

Andrew Fan

13:22>> Everything depends on on the complexity, but I would say that the entry amount should be somewhere near 25,000.

Nathan Latka

13:32I see. I see. And I mhmm? Can I ask about how much the agency did last year in total revenue?

Andrew Fan

13:45>> Yeah. We did a few millions.

Nathan Latka

13:48Okay. That makes more sense. So you do a film a few million across 55 engineers. When did you that's impressive, Andrew. When did you launch the the agency?

Andrew Fan

13:58>> I launched it, in, 2012. So it's kind of, like, ten ten years ago.

Nathan Latka

14:05That's Andrew, forgive me here, but you look very young. How old are you?

Andrew Fan

14:09>> I'm 34.

Nathan Latka

14:1134. Okay. So you launched it when you were 24, and you've just been committed to it ever since.

Andrew Fan

14:16>> Yeah. Yeah. Never worked on on someone except my clients for for an agency or for my That's

Nathan Latka

14:26that's awesome. So what do you think is gonna happen for the next five years at the agency? Do you think one of these SaaS tools is gonna take off and you're gonna stop doing custom work and do more SaaS work? Or do you think you wanna do less SaaS work and more agency work?

Andrew Fan

14:41>> There are a few, like, good options for us. So for our consulting business, we currently looking at a model called Venture Studio. So basically now we we we mostly work with entrepreneurs like helping them to launch the first version of their product and help them scale it to like multiple stages of fundraising. So eventually, we want to start taking equity.

Future Plans: Venture Studio or SaaS Scale

Andrew Fan

15:14>> This might be the first option. The second option might be, as you said, we might build one of the startups which will be able to generate revenue that will be enough to to switch more people to that project.

Nathan Latka

15:32Yep. Yep. No. That makes a lot of sense. Very cool. Rooting for you. Let's wrap up here with the famous five. Number one, what's your favorite book?

Famous Five: Books, Tools, and Habits

Andrew Fan

15:44>> Winners and Outsiders. Unfortunately, I read it in Russian. That's why I don't remember the exact name of it in English, but it's it's it's written by Robert Fitzpatrick, I guess. Yep. Yep.

15:59>> Robert Robert Fitzpatrick.

Nathan Latka

16:01We'll link to it in the show notes. Number two, is there a CEO you're following or studying?

Andrew Fan

16:09>> Yeah. I'm I'm again, I don't remember his name, but he appears frequently in my feeds. This guy is running a marketplace called Acquire. So I guess his contact is very close to me because I guess he he probably had, like, a similar background to to mine because he he talks a lot about his marketplace as well as about, like, doing service service type business.

16:37>> Yep.

Nathan Latka

16:38Number three, what's your favorite online tool for building organice?

Andrew Fan

16:43>> Online tool?

16:46>> I would say Mixpanel because a lot of people, they don't, like, pay attention a lot to, like, to to to collect in the data, the usage data, because usage data is a very powerful tool. It helps you to make, like, right decisions on whether or not to make certain features.

17:08>> Yep.

Nathan Latka

17:09Number three, what's how many hours of sleep do get every night?

Andrew Fan

17:13>> Sorry.

17:13Say?

17:13>> Yeah.

Nathan Latka

17:14How many hours of sleep do you get every night?

Andrew Fan

17:17>> I try to sleep seven to eight hours night.

17:24It's Fair enough.

17:24>> Like, this type of startups when I coach, like, twenty hours per day, it's kind of, like, lifestyle business.

Nathan Latka

17:33Yep. And what's your situation? Married? Single kids?

Andrew Fan

17:37>> Yeah. I have two twins.

Nathan Latka

17:38Alright. Confused by.

Andrew Fan

17:40>> Married and we have two kids.

Nathan Latka

17:43Two kids and and you're 34. Right? Yeah. Last question, Andrew. What's something you wish you knew when you were 20?

Advice to Younger Self

Andrew Fan

17:53>> Yeah. I I I would wish myself to start experimenting with startups earlier because for the first, like, six, seven years, we were doing only consulting, and I thought that this is a holy grail. However, then I realized that building something from scratch, being fully responsible for all decisions is much more fun than doing consulting.

Nathan Latka

18:21Guys, when Andrew was 24, this was back in 2012, he launched his own agency and started doing consulting work. Today, he charges on average $20.30, $40,000 per project. And last year did quote several millions in revenue, call it 3,000,000 in revenue. But what we talked about today was how he's launching his individual SaaS applications like organice.app on the slap Slack app exchange, which helps you bring your org chart into your Slack channel. If you're a smaller

18:45team, that's maybe too early for the enterprise level org charts. He's just now got his first paying customers on that product. 55 engineers up at the holding co level, 1.5 of which we'll call it a person and a half working on the spin off for Organize App. We'll see what he does next. Andrew, thanks for taking us to the top. One more thing before you go. We have a brand new show every Thursday at 1PM central.

19:06It'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 Central. Additionally, remember these recorded founder interviews go live. We release them here on YouTube every day

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19:54Additionally, if you want to 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 for that at nathanlatka.com/slack. In the meantime, I'm hanging out with you here on YouTube. I'll be

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