How TitleCapture Reached $4M ARR with 1,000 Active Customers While Staying Bootstrapped (Interview with CEO Alex Samant)

Introduction and Company Overview

Nathan Latka

00:00Titlecapture.com launched back in 2013. They finished 2021 with $280,000 a month in revenue, and they've grown nicely five to 10% year over year. The the the definition of a healthy bootstrapped company, they profit 30% every month. So on $333,000 a month in top line revenue today, call it $90,000 worth of profits, which they keep 50% of that in the bank to grow their cash balance. Now over $600,000, he likes to see three to five months of

00:23expenses in the bank to stay safe. Now thinking about capital allocation, what can he buy? Can he buy distressed assets to keep growing the company? He's got the team to do it, 35 folks, 10 engineers as they look to continue to scale in a bootstrapped way. Hey, folks. My guest today is Alex Samant. He's the cofounder of titlecapture.com, where they help US title agents, real estate agents, and loan officers provide hyper accurate cost estimates to home

00:45buyers and sellers. The company was founded in 2013, a 100% bootstrapped, and now doing almost 4,000,000 in ARR. He's got personal skills and background, including product design and marketing. Alex, you ready to take us to the top?

How TitleCapture Was Founded

Alex Samant

00:59>> Yeah. I'm really thankful for being on your podcast, Nathan.

Nathan Latka

01:03You bet. Did you start off sort of as a broker and said, you know what? I don't like this whole commission structure. I'm gonna go build a SaaS company instead.

Alex Samant

01:11>> No. No. No. It it's the the story is actually lot simpler and not that glitzy and, you know, we me and my cofounder were developing, you know, software, basically outsource getting projects and whatnot. At some point in 2013, we kinda got fed up of that business model. And then we decided, hey, let's build something that we own and we sell a subscription instead of just constantly going back to step one with every new client. And so

01:42>> what happened was that we

First Customer and the Lifetime Deal Origin

Alex Samant

01:47>> had a company who wanted us to build a rate calculator app for them, right? And that's when we decided, well, hold on, instead of actually selling it to them, let's find out more about this need and let's do some research because they're pretty big and if they need it, chances are that the whole market might need something like this. And we do the homework and we propose to them, hey, you don't have to pay us hundreds

02:12>> of thousands of dollars, just pay us a thousand dollars a month, you know, going forward and we'll cap it lifetime deal and we'll build it, but we're gonna own it. And they said yes, and that was the start of what titlecapture

Nathan Latka

02:25Are they still paying 1 k per month today?

Pivoting from Outsourced Dev to SaaS

Alex Samant

02:28>> Yeah. But they were acquired by one of the biggest title insurance companies in the country, First American. Did they cancel titlecapture after they were acquired,

Nathan Latka

02:36or they're still they're still paying and using

Alex Samant

02:38>> it? No. No. The funny story is the the acquiring company already had a solution, but the people that were using us, they sort of were activists, and they didn't wanna let go of it. And so they kind of opposed canceling, and we're still with them.

Nathan Latka

02:57Sounds like you need to write a book, The Activist Customer.

Alex Samant

03:01>> Yeah. That's awesome. That would be a good customer success book.

Nathan Latka

03:04That would. So so how did you structure this in the early days? Because I have a lot of founders listening that are launching their first product. Someone has told them, yes, we're willing to pay. But making the leap from someone verbally saying yes to actually signing a DocuSign and maybe actually wiring via Stripe the first, down payment is a whole another issue. So how did that work for you?

Alex Samant

03:23>> Well, I mean, we were pretty fortunate.

Trade Show Strategy and Early Go-to-Market

Alex Samant

03:28>> What happened in the here's another funny story. We were supposed to be three partners, right? I was kind of on the design side, and we had a programmer, and then my cofounder who was doing sales and business development. Right? And when we decided that we're gonna build this thing, we also, in parallel, booked a booth at the annual convention in West Palm Beach called Alta One, like, Alta being the American Land Title Association. The problem was

03:54>> that three weeks or four weeks before the trade show, our programmer kind of went missing in action. Forget about it. We didn't have any code. We didn't have anything. So I had some background in computer science, and I did figure it out on my own. So obviously, our v one point o, I don't think it was very functional. It looked great. It was something to show people at the trade show.

04:19>> Obviously, we pivoted and we made it work, you know, in the coming weeks. But we went at the trade show, and our go to market strategy was practically nonexistent. We got lucky because one person at the trade show who was a the national sales rep for a large title insurance company loved it, right? And our customers are the title agencies, right? They're the resellers for title insurance policies. The title insurance company is they're like the brokers,

04:50>> the middleman, right? And so every title insurance company has tens and hundreds and thousands of title agencies that they do business with. So this guy saw our product and was like, Dude, I would love to put it in front of all my title agencies because I'd love

05:03>> to do this.

Nathan Latka

05:04Disrespect you, but you weren't our developer. How are you able to build something that this guy's never seen before, and you're not even a developer? I mean, what why why hadn't someone else done this thing yet?

Alex Samant

05:15>> It's a slow, non tech savvy industry. You know? Back in 2013,

05:23>> there weren't many solutions, and the ones that existed looked like they're from the nineties.

05:29I see.

05:29>> So when we came in with a responsive, modern looking thing that was easy to use and, you know, I mean, we had background in creating product. So it was obviously superior. And what we added as a nice touch was that we branded it. We basically made it a white labeled web app for each and every single customer.

Nathan Latka

05:48I see.

Alex Samant

05:49>> So that when they put out this rate calculator, it was representing them, and it was nicely branded

05:55>> and all that. So it won with ease of use and aesthetics.

Nathan Latka

05:59Oh, 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

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06:46get 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

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08:22the interview. So fast forward to today, how many customers are you working with?

Current Customer Count and Active Subscribers

Alex Samant

08:28>> We have signed up of 1,500 title agencies thus far. The market in total is 13,000.

08:40>> So with competitors and everything, we're pretty, you know, satisfied with how how far we've come and then what's slow moving What each

Nathan Latka

08:47of those 1,500 pay per month on average?

ACV, MRR, and Revenue Run Rate

Alex Samant

08:50>> The the ACV is about $4.

Nathan Latka

08:54Yeah. So that's annual value. Right?

Alex Samant

08:56>> Right. So it's slightly above 300 a month Mhmm. Average. But we have customers in the thousands a month.

Nathan Latka

09:04So can we take the 1,500 customers times $4 ACV? That would put you at, like, a 6,000,000 run rate today. But you said in the bottom, you're more at 4,000,000.

Alex Samant

09:10>> So it's not There's yeah. We've signed up we've signed up 1,500, and when you take out the churn companies, I don't know, we're about around the thousand active.

Nathan Latka

09:22Okay. So thousand active at four a year puts you at a 4,000,000 run rate today or about 330,000 a month in revenue.

Year-over-Year Growth and 2022 Slowdown

Alex Samant

09:29>> Yeah.

Nathan Latka

09:30And where were you exactly one year ago?

Alex Samant

09:34>> One year ago, we were

09:38>> 6% less because I remember the growth in 2022 was 6%.

Churn Trends and Market Conditions

Alex Samant

09:46>> The real estate market definitely took a bit of a hit towards the end of the year, last year. Mhmm. We have seen a bit more churn than usual. Our churn is normally at about point 0.7% month over month. Mhmm. But in the sort of last couple of months of 2022, we did see it up to 1.7, 1.8. People got scared. A lot of title agencies decided to kind of cut costs across the board because they didn't

10:17>> know what was coming, you know, so they take took all this sort of preemptive action. But it has come back down since then, so people are starting to get a little more confident about where the market's going. But it's been kind of three, four months rough where our net new MRR was negative.

Nathan Latka

10:33Okay, so 313,000 a month a year ago would be 6% growth, up to three thirty three today. Take us back one more year, what did you finish 2021 with MRR wise? Do you remember?

Alex Samant

10:46>> February. Something like that.

Nathan Latka

10:47February. Okay. So, I mean, this is the definition of, like, you know, people say overnight success, but no. You're just plugging away five to 15% year over year growth for the past seven, eight, nine, ten years. Right? Yeah. Totally bootstrapped.

Bootstrapped Growth and Strategic Crossroads

Alex Samant

11:01>> It's actually totally bootstrapped, and what's actually now becoming very evident is that growth is tapering because of the fact that we're going higher into the sort of market share quota and because you have other competitors, because whatever, you've already signed up, the people who are tech savvy and they want to use technology, it's getting increasingly difficult to grow or to maintain stable growth by sheer new customers. So now what really becomes a necessity for us strategically

11:35>> is to start looking at building more product to increase that ACV. So for example, our product is a rate calculator, but the next step of the process is a full on settlement software, which helps the title agency manage the whole transaction.

Nathan Latka

11:53You own that product. You upsell that product.

Alex Samant

11:56>> We don't have that product yet. There's another competing company that came along in 2016 that that disrupted that market.

Nathan Latka

12:03Why don't you buy them? Or why why didn't you build it?

Alex Samant

12:10>> What do you mean?

Nathan Latka

12:11Well, why didn't you go buy it? If you know that's the next upsell, why why haven't you guys built that internally to start upselling yourself? Or or why have you not gotten bought that bought that competitor?

Team Size and Engineering Headcount

Alex Samant

12:20>> We just didn't get around to making that definite decision, right? So it's because of internal decision making that's slightly slower.

12:30>> But we definitely have to start moving, either buy or build whatever, because that's a 40,000 ACV product. It's a 10 times. So if you want to grow from this point on, you have to really start going out there and building more value.

Nathan Latka

12:44Alex, what's the team size today? Many folks?

Alex Samant

12:48>> 35 to 40 people.

Nathan Latka

12:49Oh, wow. Okay. How many engineers?

Alex Samant

12:55>> Up to 10. Not more than 10.

Nathan Latka

12:58Are they all full time, or do you you sort of outsource development shops?

Alex Samant

13:02>> They're full time. I think our DevOps engineers are outsourced.

Nathan Latka

13:06You're what? Okay. So what? Like, five ten of those or no?

Alex Samant

13:11>> No. It's about two people. Two or three.

Nathan Latka

13:13Okay. Interesting.

13:15Very cool. And then, I guess, talk to me I mean, this is a great Bootstrap story. It's not every day you hear a Bootstrap are going up to $4,000,000 in ARR, so I wanna focus a little bit on that. Are you running it sort of right at breakeven, or do you guys have profits every month?

Profitability and Capital Allocation

Alex Samant

13:27>> Oh, no. The company's highly profitable. It's 33% profit margin.

Nathan Latka

13:32Okay. So you guys will do then about $90,000 a month in profit on your 330,000 of top line.

13:38>> Yeah. Yeah.

13:38What do do so what do

13:39do as a capital allocator? As a capital allocator, what do you do with that $90 each month in profits? Do you pay it out as dividends? Do you reinvest it?

Alex Samant

13:46>> What do do? We pay it out right now. But, we're also making sure the the cash is there to kinda sustain whatever might happen. Right? So we've taken all kinds of, you know, good financial, you know, safety measures. So what what makes you feel safe? Distributed.

Nathan Latka

14:07How how much cash in the bank makes you feel safe?

Alex Samant

14:09>> Three months worth of expenses. You know?

Nathan Latka

14:13Which is how much for you?

Alex Samant

14:14>> Well, it should be about 500,000, 500, 600,000.

Nathan Latka

14:19Okay. Interesting. That's a good target to get to.

14:25Yeah. As a as a cushion, just to make you feel safe, that makes sense. Now how do you structure the $90,000 in payouts each month? We had Bridget on with You Can Book Me, who had a whole profit sharing plan she does each month. How do you guys think about distributing?

Alex Samant

14:37>> We just make it half half, because we have two partners, 50% each. And well, we don't take it all, right? We kind of limit it to the point where half stays in cash, just adds to the cash every single month.

Nathan Latka

14:54So 45 ks of the 90 ks would stay in the business, so your cash balance now is 650,000, and you guys each take whatever $2,030,000 a month, you split the rest.

Exit Scenarios and Strategic Acquirer Math

Alex Samant

15:03>> Yeah. Yeah. Pretty much.

Nathan Latka

15:05And that's your salary, or is that on top of your salary?

Alex Samant

15:07>> Yeah. No. That's that's basically what we pay ourselves.

Nathan Latka

15:11I see. You know?

15:13I see. No. That's great. I mean, I I love this model. Now if we look at, like, personally, what you what maybe you would make on the company over time, like, we're, like, $25 a month from the dividends times twelve months, I think is, $300,000 per year. And the reason I set that context is if someone came to you and offered you and your partner to buy the whole company for, you know, say, 10,000,000 all cash

15:34upfront today. Right? Do you sell?

Alex Samant

15:40>> It's a tough that's a tough question to answer.

15:46>> We're definitely open to an exit opportunity, but at the same time, we know that there's room because of my conversations with all the our customers, there's a lot of opportunity. And on one hand, there's more we can build and grow the company.

16:06>> On the other hand,

16:09>> when comparing a financial buyer's offer with the existing bigger sort of settlement software or insurance company, the value of our customers that we have today to them is a lot higher than what a financial buyer would offer. Right? We were actually doing the math, I'm not gonna name any names, but we realized that for one of our partners, a buyout would be in the range of 60 to 80,000,000.

16:40>> You know, that would be fair value to them. Actually, that would be a discount. You know?

Nathan Latka

16:46So That that would be really I mean, look, I see a lot of deals in today's market. That would be a premium exit valuation. So why are you not signing and taking that immediately?

Alex Samant

16:56>> Because we didn't get the offer yet. We don't have any offers because we haven't been as proactive as we should have in in networking and just being in front of all the potential strategic acquirers. Right? So we have to do a lot more of that. You know, that's my take on it.

Nathan Latka

17:13Well, so what are

Alex Samant

17:14>> what How are much on the work, you know?

Nathan Latka

17:16Yeah. I mean, so how are you thinking about the business, I guess, moving forward? You know, it sounds like you're very comfortable, and this is not a bad thing, by the way. I'm not this is not a disconcer being comfortable. This is a it's a compliment. You're in a very comfortable spot. So you can keep doing status quo. No problem. I don't know if you're competitive. You play varsity sports back in the day. Maybe you wanna

17:33go build a billion dollar company. That would be a different model. Or maybe say, you know what? I wanna go build a family and get out of operating and free up my time and sell the whole thing. Which of the buckets do you fit in or a different bucket?

Alex Samant

17:47>> I would I would dig in the second because I always wanna challenge myself and build a bigger thing and more. So the way I see it, it's you know, this is an asset, so I need to grow its value or build more assets if I can't do this. It's it doesn't matter. Right? We've The sky's the limit, and no matter how small the niche is, if you dive deep in it, you'll find opportunity everywhere. We've actually

Famous Five Rapid Fire

Alex Samant

18:14>> discussed finding a distressed insurance underwriter that we could buy, that we would need an investor, obviously. You could take outside money. Buy that distressed underwriter and use our technology to position it, to create an angle, and start competing with the bigger underwriters. And that's a different market altogether because we're talking about hundreds of millions in revenue every year. It's insurance, right? Yeah. So there's all sorts of things. Feel like the best

18:52>> and the most important thing is for the owners and the founders to get on the same page and make these calls, you know, because you don't always have the same values, don't always have the same, you know, wants, right? And so,

19:14>> I think moving forward is usually slower Very good. When there's a pie. In the beginning, there's no pie. You you move at the speed of light, but then, yeah. You know? Yep.

Nathan Latka

19:25Alex, we're out of time. So let's wrap up here quickly with the famous five. Number one, favorite book.

Alex Samant

19:31>> Favorite book? I'm gonna plug in my, you know, Dan Martell's Buybacker Time. Let's go.

Nathan Latka

19:36That's a good one. Number two, is there a CEO you're following or studying?

Alex Samant

19:45>> Many of them. But if I had to choose one why is this so difficult, man?

19:54>> I don't know. I have no idea. Let's say Elon Musk, because he's on Twitter a lot and it's funny.

Nathan Latka

20:01Number three, how what online tool do you use or is your favorite online tool for building titlecapture?

Alex Samant

20:09>> HubSpot.

Nathan Latka

20:10Number four, how many hours of sleep do get every night?

Alex Samant

20:14>> Wow. That's about six.

Nathan Latka

20:16Okay. That's good. And what's your sit situation? Married, single, kids?

Alex Samant

20:20>> Married, two kids.

Nathan Latka

20:21That's awesome. Two daughters.

20:22How old are you, Alex?

Alex Samant

20:25>> I'm 39 going over 40.

Nathan Latka

20:26That's awesome. Congrats. Happy early birthday.

Alex Samant

20:29>> Thanks.

Nathan Latka

20:30Last question. Something you wish you knew when you were 20.

Alex Samant

20:34>> Something I wish when I was 20.

Nathan Latka

20:38You knew.

Alex Samant

20:39>> Yeah.

20:40>> I wish I knew that oh, man. You're asking tough questions, man.

20:52>> Damn.

20:56>> That building a business that actually

21:02>> how should I put this?

21:07>> No. I'm having a hard time putting it because it's very complex.

Nathan Latka

21:12We can skip it. It's no problem.

Alex Samant

21:14>> Yeah. We can skip it. It's there's lots of ideas. Like, I'm having a hard time.

Nathan Latka

21:18Guys, there you have it. Titlecapture.com launched back in 2013. They finished 2021 with 280,000 a month in revenue. They've grown nicely, five to 10% year over year. The definition of a healthy bootstrapped company, they profit 30% every month. So on $333,000 a month in top line revenue today, call it $90,000 worth of profits, which they keep 50% of that in the bank to grow their cash balance, now over $600,000. He likes to see three to five

Closing Summary

Nathan Latka

21:42months of expenses in the bank to stay safe. Now thinking about capital allocation, what can he buy? Can he buy distressed asset to keep growing the company? He's got the team to do it, 35 folks, 10 engineers as they look to continue to scale in a bootstrapped way. Alex, thanks for taking us to the

Alex Samant

21:55>> top. Thanks, Nathan.

Nathan Latka

21:58One 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

22:24Central. 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

22:46fundraise, a big sale, a big profitability statement or something else. I don't want you to miss it. Additionally, 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

23:08up 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 and 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.

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