How Regpack Hit $10.5M Revenue Bootstrapped Across 1,500 Customers (Interview with CEO Asaf Darash)

Introduction and Company Overview

Nathan Latka

00:00Guys regpacks launched in 2012 had their first million dollar year in 2016. Today over do over $10,000,000 in revenue across 1,400 summer camps, after school programs, NFL camps, things of that nature that each customer pays on average cost $7,000 per year across three lines of business. One is a percent of GMB, one's purchase protection when you buy tickets for your kids, if they get sick, you want your money back and the other is a pure SaaS

00:24fee, 3 ks per year on the SaaS fee per seat model scaling nicely. They've done it all bootstrapped, which we love incredible growth here with a team of 30. So really high revenue per employee of three fifty ks impressive story here. Hey folks, my guest today is Asaf Darash. He is building a company called regpacks. It's regpacks.com, which is registration and payment processing. Asaf, you ready to take us to the top?

What Regpack Does: Shopify for Services

Nathan Latka

00:46>> Yeah, sure.

00:46All right. Registration and payment processing for what industry?

Asaf Darash

00:50>> So we are what you can call like a Shopify for services. Basically the service industry, mainly the service industry right now. Serve mainly education, camps, courses, after school programs, schools,

01:07>> and we're expanding also to more industries as we grow.

Origin Story: PhD at Berkeley and the Metaprogramming Problem

Nathan Latka

01:12And I guess why do you intimately know this space? Well, did you have your own camp after school camp program before this, or how do you know about the problem?

Asaf Darash

01:19>> So actually this is, this is a nice story. This all started when I was doing my PhD at Berkeley and I was doing a PhD in computer science and built a system that has no constants in everything's a variable. And as I was working on this, I asked myself, okay, what industry would need something like that? It's basically what it's called the metaprogramming problem. And as I was looking, I saw the service industry in general and

01:48>> especially the education industry, in the service industry, and it was extremely fragmented. And the reason that it's extremely fragmented is because it has a very unique need, a need for onboarding. Like when you

02:03>> register for a camp or for a course or for university, for a school, you need to onboard, right? Or for an event or conference, it doesn't matter. Anything that is based on a service you have to onboard unlike buying a pen or a computer. And this onboarding creates this fragmentation in the market because every onboarding is different. And then I understood, okay, this solution that I created at Berkeley can actually work exactly for that because it

02:31>> can consolidate this type of

Nathan Latka

02:35front Understood. And so how do you, how do you build, so like for an after camp or after school program that might use you, how do you make money? Do you charge a flat fee or percent of revenue? How do you make money?

Revenue Model: SaaS Seats and Payment Processing

Asaf Darash

02:45>> There, there are actually two revenue streams here. One is the, like the basic SAS revenue stream, you know, paying for subscription seats. So every admin, and we have like new levels of admin. And the other one is through the payment processing. We have, very special deals with payment processors and we offer, to the end client, a lot of, advantages working, through us when they're, when they're processing their payments and we take a share out of that.

Nathan Latka

03:12And how much? So if I put a $100 through your program, what would you keep?

Asaf Darash

03:17>> If you put a $100 through the program, most likely the organization would pay something like $2.30, and I would just keep $30.30 cents out of that.

Nathan Latka

03:30Wow. Okay. And the other the other $2 goes to what? To Visa, Mastercard, somebody else? Yeah. Interesting. Okay. So you're keeping gosh, I mean, that's like, so you're keeping under one, you're giving like 0.3% of your total GMV.

Asaf Darash

03:43>> Exactly.

Nathan Latka

03:44Okay. Interesting. Is there room to flex that up or is that sort of market rate?

Asaf Darash

03:51>> There is room to flex that up and it really depends if you want, we can go into, like there are situations where we actually make close to a percent. Okay. And it really depends on the type of card that is being used. If it's an enterprise card or if it's a debit card, if they're paying through ACH, the whole way that payments works is very complex.

Nathan Latka

04:13I know I don't want to go down that rabbit hole. I know it's complex, but when you would say your weighted average though, you would say is point 3%.

Asaf Darash

04:20>> No. The weighted average is 1%.

Nathan Latka

04:24Oh, it is 1%. Okay. Cool. Got it. So if someone uses the perfect transaction part, no Amex, you know, something super simple, right? Then you can earn, you know, as high as you might take it, sorry, if there's not a lot of credit card processing fees, you could take as much as 1%. If there's lot of fees, depending on how they use or the ACH, you might take as little as 0.3%.

Asaf Darash

04:44>> Yeah. And, like, but if you ask the, like, like the perfect in the perfect situation, we could take, like, you know, out of the 2.3%, we would take, like, 2.29.

Nathan Latka

04:56And what would that be? Would that be like a check mail then? Oh, ACH. Okay. Oh,

Payment Processing Take Rate and Weighted Average

Nathan Latka

05:04what'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 your

05:27Stripe 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 get

05:51a 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 not

06:13built 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 going

06:39out right now and you're raising your seed round. We'll 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 dataset of SaaS valuations than what you can get now inside of Founderpath. And we're thrilled to bring it to you. All right. We're gonna go back to the YouTube video here in a second. But if

07:00you wanna check this tool out, if you wanna jump in and sign up, you can check it out for free to get your valuation at this link, this link, founderpath.com/products/valuations. 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. Alright. Let's jump back into the

07:27interview. What about the if you had to split these up, so look at your total revenue last month, what percent was SaaS versus payment processing would you say?

Revenue Split: SaaS, Processing, and Purchase Protection

Asaf Darash

07:36>> Payment processing is about 40%. SaaS is 40%. And then we also offer a program called purchase protection for the organizations, which allows them to, the end user, protect themselves against death, sickness, etcetera. And that's about 20% of our revenue.

Nathan Latka

07:55I don't understand that. So I spend $50 to buy the after camp program. I can go climbing through Yellowstone. And basically I'm saying if I die between now and when I purchase my ticket, when the hike starts, then I have protection. Yep. People care about it. So if I buy a ticket today to hike Yellowstone through your program and they hike it in a week, I'm gonna pay something to prevent, like if I die, get a

08:16refund?

Asaf Darash

08:19>> If you're sending your kids to a camp that costs $2,000 a week, you will protect them because if they're sick for one week, you're out of $2,000

Nathan Latka

08:28Oh, I see.

Asaf Darash

08:29>> So someone would pay $200 where you'll refund the $2.

Nathan Latka

08:31It's basically insurance.

Asaf Darash

08:32>> You'll refund the $2 if the kids are sick and can't go.

08:36>> Exactly. It can be based on a week. Like if you take the kid to the camp for like six weeks and only in one week they're sick, fine. You get on for that week. That's fine.

Nathan Latka

08:45I see. I see. Okay. And then if we just look at the SaaS component of your business, what does the average after school programmer camp pay you per month to use the technology?

Purchase Protection Explained

Asaf Darash

08:54>> Between 2 k to 4 k.

Nathan Latka

08:57Wow. Per month? Per year. Oh, per year. Okay. Got it. Per year. And what do you price on? Is it number of courses offered, number of days in session?

Asaf Darash

09:06>> Just a seat. Just a seat.

Nathan Latka

09:08Just seat. Okay. So it's the number of camp counselors that need the, or the camp admins that need to use the software.

Asaf Darash

09:13>> Like you have a full time admin, which a full time admin would be like probably the director. Then you would probably have one or two financial admins, which would be the administrators that are sitting in the back office and the counselors will be free, right? Because they don't need access to financial information and stuff like that. They only see let's say the camper information. I see. Actually what I want to talk about, which is the most

09:39>> interesting part that regpacks does.

Nathan Latka

09:41Well, hold on, hold on. Asaf, let me just finish up the economics here. Then we can go down the product roadmap for a second. Just to be clear, if you're doing about three ks per year on the SaaS model and that's 40%, do you make something like another three ks on processing and then another call it like 1,500 on the purchase protection? So you're making something like 7 ks per customer per year all in.

Asaf Darash

09:59>> Between 7 to 10, yeah. Like depends, like you have clients that make a 100 ks off of them. You have clients that you make, like, the basically, the minimum you would make off of clients is five.

10:09Yep.

10:09>> The max, we have clients that we make a 100, a 150 off.

Nathan Latka

10:12Okay. Okay. So now go down where you're gonna go down. It sounds like a product feature.

Asaf Darash

10:15>> So I one of the things that we introduced last year, which I think is the most important thing, most interesting thing that we did is that we

10:26>> brought payment installments into the service industry, which is very similar to buy now pay later, but without credit checks and without any financial risks for anybody. What we did is, okay, let's take the camp because that's like the easiest one to think about, right? When I'm registering my kid to the camp, normally I'm doing it on January, February, March, right? And then he's going to the camp probably in June or July. So there's a time span

10:54>> between the moment that I did the registration or the application and when the service is actually given. So what we did is we created an algorithm that is able to understand when the organization actually needs the money to serve that specific order. And we allow the end user to pay in installments until that time. So for example, if I go in, I might see that I can pay six installments. If you go in, you might see

11:22>> that you can pay nine installments, depending on what you ordered, on the time span and like how much the service is actually costing the organization. So what is happening is I go into the page to pay and I see the ability to pay in installments, but unlike buy now pay later, I don't need to do a credit check and I am not creating any risk because it's connected to when the organization will actually need the money.

11:49>> Now, organizations that have implemented this new feature of automatic installments have seen a 30% revenue growth right by, right off the bat, just from implementing that. Because what happens if I'm a parent and I go in and I need to pay, I don't know, for five weeks, let's say 5,000. I don't have $5,000 right now. So I'm going to wait another month or two when I have the money. Right. Or I'm going to put it on

12:12>> my credit card and then pay interest.

Nathan Latka

12:14Asaf, what's your markup? If the retail, if the wholesale price is $5 and you offer an installment plan, are they gonna pay $6 total all in over six They're thousand dollars

Asaf Darash

12:22>> pay only $5.

Nathan Latka

12:24Okay. So who's associating with the risk if somebody only makes two payments and then goes broke and can't make

Asaf Darash

12:28>> No, the rest that's of the trick.

Nathan Latka

12:30Asaf. Asaf, listen to my question really quick. If a parent, I'm a parent, tells a camp, they buy the camp website using your software. They pay $3, right? But I'm gonna pay a bunch of payments of 500. Okay. My credit card shuts down or expires two payments in. Camp has held a spot for me already. Right? And you haven't delivered the full payments back to the camp for that, you know, the $500 per month Who has

12:55that? That is real risk. Who has that risk on their balance sheet?

Asaf Darash

12:58>> It's the risk because you pay two payments, which you're not gonna get back and the camp reopens the spot.

Nathan Latka

13:04Who So keeps the money and have two payments already made?

Asaf Darash

13:06>> Still and it still has four months to fill that spot.

Nathan Latka

13:08So who keeps the $2,500 payments I already made before I couldn't pay more?

Asaf Darash

13:12>> Basically, camp, unless they wanna give it back.

Nathan Latka

13:16Do you require they give it back if they sell the seat to somebody else?

Asaf Darash

13:19>> I don't, we don't, we don't, don't deal with that at all. That's between the camp and the parent, which by the way, we have 97% payments on the installment plans that go through completely. Only 3% of the payments don't go through.

Nathan Latka

13:35There's an aspect here, though, of time value of money. Right? If the camp is able to get $5 on January 1 versus June 1, they have six extra months to invest the 5 k to make the camp better. So why wouldn't they charge more if someone's on a payment plan?

Asaf Darash

13:48>> First of all, they can, but nobody does that because they can close their camp faster. And then they know that the camp is just done. Mhmm. If they if they know that they are fully booked in, I don't know, March, instead of continuing to spend marketing dollars until June, that's worth a lot more than doing a markup.

SaaS Pricing Per Seat

Nathan Latka

14:09I see. I see. I see. Okay. This makes a lot of sense. And sorry, just put this on a timeline for me. When did you first write the first lines of code for this? What year?

Asaf Darash

14:18>> I don't like when I actually wrote code that was not connected to Berkeley was 2012.

Nathan Latka

14:24Okay. So you launched the company in 2012 and how many customers today?

Asaf Darash

14:28>> Today we have about, if I'm not mistaken, 1,500 organizations.

Nathan Latka

14:351,500 are actively paying you?

Asaf Darash

14:37>> Yes.

Nathan Latka

14:38Okay. So if we take that $7,000 ACV you gave earlier, average counter value per year times 1,500, that would put you at 10,500,000 a year in revenue. Is that accurate?

Asaf Darash

14:47>> Are

Nathan Latka

14:49you sure? Where are those

Asaf Darash

14:52>> numbers want share it because we're company.

Nathan Latka

14:55Well, but you've given me two numbers, Right? Then you've already said the two numbers and average contract value times customer account should equal your revenue. So why would they not? Is your ACV actually lower than $7?

Asaf Darash

15:06>> No, because I said some of them are higher.

Nathan Latka

15:09Okay. So you're doing more than 10,500,000 per year right now in revenue?

15:13>> Correct.

15:13Okay. Very cool. Congratulations. That's exciting. Have you how have you capitalized the business? Bootstrapped or raised capital?

Asaf Darash

15:19>> Totally bootstrapped. Never taken it on.

Nathan Latka

15:21That's great. What's the team look like today? How many folks full time?

Asaf Darash

15:26>> Full time we have 30 people.

Nathan Latka

15:28Okay. 30.

15:31I mean, that's sorry, just to

Asaf Darash

15:34>> It's very efficient. Yes.

Nathan Latka

15:35Yeah. So how have you got, I mean, that's $350,000 in revenue per employee. Most bootstrap companies at your stage are doing something like 200 ks in revenue per employee. So how are you so efficient? Are these like cheap engineers somewhere overseas or how do you get the efficiency?

Asaf Darash

15:47>> We have very, very good engineers, but very few of them.

Nathan Latka

15:53Okay. That didn't answer my question. So, where do you get the fit? You're generating almost two X the average revenue per employee as others in your same spot. How are you getting that extra efficiency?

Customer Count, ACV, and Total Revenue

Asaf Darash

16:03>> Because the people that are, first of all, we do a lot of automation. We're very data oriented. Most of the people that are in the company are Berkeley grads. So we know how to look at data and how to make sure that things are efficient. That's one. Two, we build the software in a way that there's very little

16:25>> development debt. So the features that we build or the updates that we do are minimal right now. So we're focusing mainly on marketing and sales. Our support is extremely efficient. We're using AI for support. We're using the ability to, we have this tier structure where we use different tiers based on the client income that they create. And based on that, we understand who needs to get answered faster. And that way we're making sure that the clients

Installment Payments Feature and How It Works

Asaf Darash

16:56>> that are generating the most revenue are always getting the best type of service and never leaving. We have another system that allows us to understand which clients there's a higher probability of them churning or not, okay, based on how they're using the system and what they're doing in the system. And then based on that, we make sure that the clients, that there's a higher probability of them churning to, we make sure that they are using the

17:23>> parts that they should be using. Like I said, we're very efficient.

Nathan Latka

17:27Okay. And just to be clear, as we understand growth rate here, it's impressive bootstrapped. If you're at north of 10,500,000 ARR today in revenue, where were you exactly one year ago?

Asaf Darash

17:38>> What was that? Seven?

Nathan Latka

17:40Okay. So, I mean, that's pretty great. So how did you get a 40% year over year growth? Was it expanding into historical accounts or adding brand new customers altogether?

Asaf Darash

17:47>> Oh, I think it's both. We've also, the product protection has grown a lot in the last two years. We have also, one of the things that is very unique in regpacks, which is very different than other softwares in this space is that what happens normally is that softwares are vertical specific. Okay. So for example, a school would use one software for the conference, one software for the camp, one software for the after school, etcetera, etcetera. Right

18:21>> now, what happens with regpacks? Because it's multi, it can work in multiple verticals. When you get a client, you start working with that organization to go into additional verticals for that organization. Now, once they've gone into two or three verticals, that's it, it's game over. They cannot leave. And why can't they leave? Because it's not about replacing regpacks for a different software. It's replacing regpacks for multiple softwares. Nobody's gonna do that unless we're terrible, which we're

Bootstrapped, Team Size, and Efficiency

Asaf Darash

18:48>> not. Okay. So we grow within the organization, normally within different departments. They tell us like, Oh, talk to that department. That has nothing to do with me. But they're recommending, they're saying like, Nathan,

Nathan Latka

19:01you should

Growth Strategy: SEO, BDRs, and Multi-Vertical Expansion

Asaf Darash

19:02>> use redpacks for the stuff that you do and go within the organization. And we also, you know, have a very strong SEO and sales mechanism. We have BDRs, we have outbound sales.

Nathan Latka

19:12How many folks carry a quota at regpacks?

Asaf Darash

19:16>> How many folks?

Nathan Latka

19:18Many people? How many people carry a quota?

Asaf Darash

19:22>> Oh, what is that?

Nathan Latka

19:24Seven?

19:25Okay. Wow. Okay. So, and then I guess how many of 30 are engineers? Two. Because you have two engineers. God, I guess I'm just shocked that two engineers have built a SaaS platform doing 10,500,000 a year in revenue.

Asaf Darash

19:41>> It's all about the engineering.

19:44>> By the way, I'm one of them.

Nathan Latka

19:47Makes sense. And sorry, and just to be clear too. So the 7,000,000, I just wanna make sure that's not like ticket volume. That's your, that's just your take rate, right? The two, the 0.3 to should two be higher. Do that's obviously a leading indicator for your growth. I mean, are you close to getting, you know, past the billion dollar per year mark in terms of GMV going to the platform?

Asaf Darash

20:09>> Not yet. No.

Nathan Latka

20:10Is that something you're thinking like next year or it's further out?

Asaf Darash

20:14>> I think it will take like three years.

Nathan Latka

20:16Okay. Three years. All right.

Asaf Darash

20:18>> We'll do two years.

First Million Dollar Year and First Salary

Nathan Latka

20:19Last question before we wrap up. Do you remember your first million dollar year?

Asaf Darash

20:26>> I remember my first month with $6,000 It was impressive. I was very happy. The first million dollars, yes, I think it was on year four.

Nathan Latka

20:39Okay. So that would have been 2016.

20:42>> Yep.

20:42Very

Asaf Darash

20:43>> cool. And I remember the first time I actually took a salary, was in 2019.

Nathan Latka

20:52That's awesome. And a sole founder or you have co founders?

Asaf Darash

20:56>> You can say a sole founder because the other co co founders have a small portion.

Nathan Latka

21:00Okay. But you own, call it more than sixty, sixty, 70% of the company?

21:04>> Yeah.

21:04Awesome. Alright. Let's wrap up here. Let's start with The Famous Five. Number one, your favorite book.

Asaf Darash

21:09>> My favorite book? It's actually

21:14>> it's I don't know how it's called in English. It's God is in the details.

Nathan Latka

21:20K. Devil in the details?

Asaf Darash

21:22>> Sorry?

Nathan Latka

21:23Is it God is in the details?

Asaf Darash

21:25>> God is in the details.

Nathan Latka

21:26Alright. It's like

Asaf Darash

21:27>> it's it's it's a love story that is connected also to, I don't know, how how the world works, you would say.

Nathan Latka

21:35Got it. Number two, is there a CEO you're following or studying?

Asaf Darash

21:39>> I think that Jeff Bezos is very impressive.

Famous Five: Books, CEOs, Tools, and Life Advice

Nathan Latka

21:44Three, what's your favorite online tool for building regpacks?

Asaf Darash

21:49>> For building or building?

Nathan Latka

21:51D, building.

Asaf Darash

21:53>> Oh, building.

21:56>> I don't use online tools actually.

Nathan Latka

21:58GitHub, GetLab. I mean, there's gotta

Asaf Darash

22:00>> be some GitHub. Type of tools you

22:02>> Yeah, I guess.

22:03>> Okay.

Nathan Latka

22:04Number four, how many hours of sleep do get every night?

Asaf Darash

22:09>> When I actually can sleep, then it's like five and a half hours. When I can't sleep, it's three and a half.

Nathan Latka

22:17And situation, married, single kids?

Asaf Darash

22:19>> Married with two kids.

Nathan Latka

22:20Oh, that's great. And how old are you?

Asaf Darash

22:23>> Me?

22:24Yep.

22:24>> I'm 50.

22:26>> 50.

Nathan Latka

22:27Last question. Something you wish you knew when you were 20.

Asaf Darash

22:33>> Calling myself as 50. You're you're what? Myself as a 50 year old.

Nathan Latka

22:40Okay. For someone else who's listening to this episode who's 20 years old, what's a piece of life life advice you'd give them?

Asaf Darash

22:48>> Everything is your life. Everything, your family, your work, your workouts, your mental health. Everything is part of your life. Don't don't split it up.

Nathan Latka

23:01Guys regpacks launched in 2012, had their first million dollar year in 2016. Today do over $10,000,000 in revenue across 1,400 summer camps, afterschool programs, NFL camps, things of that nature. Each customer pays on average cost $7,000 per year across three lines of business. One is a percent of GMB, one's purchase protection when you buy tickets for your kids, if they get sick, you know, you want your money back and the other is a pure SaaS fee,

23:25right? 3 ks per year on the SaaS fee per seat model scaling nicely. And they've done it all bootstrapped, which we love incredible growth here with a team of 30. So really high revenue per employee of $3.50 ks impressive story here Asaf, thanks for taking us to the top.

Asaf Darash

23:38>> Thank you.

Nathan Latka

23:40One 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

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