How ZenBusiness Doubled Revenue Past $82M and Reached 400,000+ Active Customers (Interview with CEO Ross Buhrdorf)

Event context and intro

Nathan Latka

00:00Quick context. This was recorded March twenty eighth and twenty ninth. So a couple weeks ago at my live event, saasopen.com. We had a thousand software CEOs there. If you missed it, we hope to see at the next one, September fifth and sixth in New York City, saasopen.com. But for now, let's jump into the recording.

Revenue tease and doubling since 2021

Ross Buhrdorf

00:18>> I lay in bed and pray for customers to come

Nathan Latka

00:21to the website. Have you more than doubled since 2021?

Ross Buhrdorf

00:24>> Oh my god. Yes.

Nathan Latka

00:25Okay. Great. So in 2021, did 41,000,000. So today, he's doing more than 82. He tricked me.

00:33Hey, folks. If we haven't met yet, my name is Nathan Latka. Launched and sold my first software company back in 2015 and went on to write a book about it, which you guys made a Wall Street Journal bestseller purchasing over 30,000 copies. Thank you so much for that. After the book, I launched this show and one went on to create founderpath.com. I raised a large fund to do non dilutive deals with b to b software founders.

Nathan Latka introduces himself and founderpath

Nathan Latka

01:00So far, we've invested in over 400 software founders totaling a $150,000,000. Here in 2024, we're doing three to four new deals per week. So if you're looking for capital and don't wanna give up equity, go sign up at founderpath.com for free to get your offer. Alright. Let's jump into the interview. Ross, you've got such a great story though because obviously you were in the driver's seat at HomeAway but you weren't necessarily the founder frontline. What was

Ross Buhrdorf background and HomeAway exit

Nathan Latka

01:27that experience like? Specifically what was it like when you signed or they the founders told you were selling for 3,500,000,000 to Expedia?

Ross Buhrdorf

01:33>> Well, first I need to correct you. Okay. 3,900,000,000. There we go. We like a

Nathan Latka

01:37400,000,000 400,000,000 extra. We don't wanna Well, lose

Ross Buhrdorf

01:43>> I mean, it was it was great. I mean, we went public. We raised all this this money. And then we went public, and then we sold to Expedia. And still to this day, Expedia says, you know, it was our best acquisition, and we we let them a great product.

Nathan Latka

01:57That's great. Well, we're gonna we're gonna close the interview with more on the Expedia deal. But first, we wanna learn a ton about Zen business. Over the next twenty minutes, we're gonna focus on customers and how Ross thinks about serving the customer, not being stuck in a SaaS business model, which I think you do extremely well. We're gonna talk about deals that he's been through, both, you know, he bought a bank, why did he buy a

What ZenBusiness does and who it serves

Nathan Latka

02:14bank? And then we'll also talk about capital to an extent, how he's capitalized the company, how he's using it to fuel growth. So on that note, what does Zen business do while people get a shot at your homepage here?

Ross Buhrdorf

02:23>> Yeah. Mean I think the the fundamental issue for entrepreneurs nowadays, and we really we really focus on first time entrepreneurs. It's scary going out there and, you know, doing it on your your own. So what we do is we provide everything to launch, run, and grow a small business. We primarily focus on service based businesses, primarily because those are the businesses that get that get created. So think of when we start with the formation, whether it's

02:52>> a s corp, LLC, then we go into all the compliance that you have to do, then taxes, accounting, website, banking, marketing, just everything a small business needs to get up and running all in one place. That's why the previous you know we are a platform, we've always been a platform, we're a SaaS platform and everything that the previous speaker was talking about is very, very true. We surveyed our customers.

Nathan Latka

03:20Ross, before you Sorry, I don't want no, you did a very smart survey process. I want to you have receipts to back this up. This is what the website looked like in 2018. I always want to bring context, Because you don't want us to learn from a founder doing a 100,000,000 of what they're doing now. You wanna learn what they did to get there so that you can match it to where you are right now. So

2018 launch, PLG motion, and free pricing

Nathan Latka

03:37this is what you launched this. This is how you described it. Pay zero to file plus state fees. Was this like a PLG motion or what did the funnel look like when you started?

Ross Buhrdorf

03:46>> Yeah. It very much was a PLG motion. And I tell everybody I lay in bed and pray for customers to come to the website, you know, and and they they did.

03:57Yeah, I

03:58>> mean we started out at free, then we went to paid, and now the market is, you know, we've been so successful. Now the market has went back to zero, which is where we've went and we're

Nathan Latka

04:12happy. You launched though a combination. And this is what's fascinating. These were the six products that Ross launched in 2018. And if you guys look at these, only two of those six have a dash month after it. Right? Only two of them. Two of them are fixed fees. Right? So you could say services. And then one is PLG free. I mean, I don't know if you were you thinking sort of about all the business models or

04:30this is what your customers asked for?

Ross Buhrdorf

04:32>> No. We were we were initially trying to disrupt the incumbents. Mhmm. And so a free offering is always the best way to do that. And, you know, we're back to that right now. It's very competitive in the space.

Pricing evolution from free to paid tiers

Nathan Latka

04:46So you're this is news because you move from 2018 to $20.20. This is what your pricing looked like. Yep. So why did you move from what we just saw to this?

Ross Buhrdorf

04:54>> Because we were leaving a bunch of money on the table.

Nathan Latka

04:56How did you know that? You just

Ross Buhrdorf

04:59>> That's a good question.

05:03>> Because you know, the problem with a zero cost off well, let me put it this way. The market wasn't at a zero cost offering. Yeah. So I mean, think you have to very plugged into the to the market. Now the market is at a zero cost offering and and everybody's there. At that time, we were leading it and it got us into the market. It it got us our rounds of funding. It got our our customers.

05:28>> And you know early on we were just really trying to get that motion and to discover. So to the long answer is we discovered our customers willing to pay a lot more Mhmm. For the formation piece. And then the the real

05:45>> trick here or the real learning, and this this is nothing new in hindsight, is that customers want a simple solution presented to them. They want everything in one place. Know, we are the system of record for our customers.

Nathan Latka

06:01Ross back that up though because this is your current pricing page and it looks like the op the opposite of simple.

Ross Buhrdorf

06:06>> Yeah. Well yeah it is. But this is where the market is. Sorry. This is where the this is where the market is. Now it that that's not really true. It is a simple pricing. You can either get starter, pro or premium.

Nathan Latka

06:21Yeah. That's it's simple. It's right there.

Ross Buhrdorf

06:23>> Right? That's right. It's simple there. But, know, I'll challenge you with any consumer based SMB product. This is pretty simple. And and again, it's not to your previous speaker. I just love him. Maybe he'll come on as a consultant

Nathan Latka

06:38for us. Expensive. Savneet's expensive.

Ross Buhrdorf

06:41>> Is, you know, we're the platform play. We've always been the SaaS platform play. We, in some sense, we've created this complexity. Initially, it wasn't complicated. Mhmm. Now it's complicated because all of the other folks in the space, you know, they have to check the box. So we've got what Zen Business does. We've got what they

Nathan Latka

07:02Well, you said you were leaving money on the table in 2020. You moved from this pricing to this pricing. Can I ask? Have you more than doubled revenue since 2021 when you made these pricing changes?

Ross Buhrdorf

07:11>> I don't know. You know, I'm very cautious because it's so competitive about what do you think our revenue is?

Nathan Latka

07:17Well, I don't wanna guess that, but I'm trying to let you get out here with just a percentage. Have you more than doubled since 2021?

Ross Buhrdorf

07:22>> Oh my god. Yes.

Nathan Latka

07:23Okay. Great. So in 2021, you did 41,000,000. So today, he's doing more than 82 He tricked me.

07:28>> Tricked

07:29me. So today, he's doing more than $82,000,000 of revenue, which may be north of that reading body language and these very expensive shoes.

07:40Comment. He can't he can't I had to push him so hard for this. We were having a great time. You were in your studio. I'm like I took me till a minute eleven forty seven on the podcast to finally I said I used actually we're gonna learn from Andrew here in a second Warner. He's gonna interview the next guest. But Andrew's one of his tactics if you're launching a podcast and you wanna like get data and

07:57do it in a polite way is it's called a low ball basically. So I said you can see the text. I said Ross I think you're doing out a 40,000,000 run rate today. And he jumps in and says we're well you remember he said we're well north of that you cut me off.

Ross Buhrdorf

08:08>> Yeah yeah.

Nathan Latka

08:09So they're doing well. He can't comment too much on that. I want to go, though, into you weren't just sleeping on your bed and praying. You were testing a lot growth.

Ross Buhrdorf

08:16>> Early on, I was because we didn't know what we were doing, but we figured it out.

Nathan Latka

08:19Fair enough.

Organic SEO strategy and acquisition-driven search

Nathan Latka

08:20How did you figure this out? Almost the majority of your SEO traffic is coming from programmatic SEO, the state name plus LLC.

Ross Buhrdorf

08:28>> Yeah. I'll tell you what. This is really DNA for us. As the founding CTO at HomeAway, HomeAway was even made it into the Google book as the vertical search for vacation rentals. So we were a top 10 rated organic search on the face of the planet. There's a lot of HomeAway folks. There's a lot of LegalZoom folks. There's a lot of Expedia folks now at Zen Business. So that DNA we took over. And we've done 15

09:00>> acquisitions. 10 of those acquisitions were organic search position. So this is inbred

Nathan Latka

09:06Let me for just say that. A way. So just to be clear, you looked at people that ranked high for search keywords and that drove your M and A strategy. You go buy that business just because they ranked high for a keyword.

Ross Buhrdorf

09:14>> That's right. That's right. Then we integrated So I I guess the the the point is is that in our segment, we do a lot on paid search, we do a lot with affiliates, we do a lot with every single channel, and we do a tremendous amount with brand also. But organic search has got to be key to make sure that that CAC is something that your business can sustain. Especially when you're consumer focused, we've got to

09:43>> get out in front of our customers. And once we do, once we get them converted, they love us. I hope you go into that how much What our customers love

Nathan Latka

09:51are you willing to pay to get a new customer? I mean, $1,000 $10,000 what is their range?

Ross Buhrdorf

09:56>> Well, well under that.

Nathan Latka

09:57You want to stay under $1,000 to get a new customer?

Mark Cuban partnership and homepage conversion

Ross Buhrdorf

09:59>> Oh, way under that.

Nathan Latka

10:01Okay. Got it.

10:01>> Under that.

Ross Buhrdorf

10:02So high volume, low ARPU approach. You're not selling enterprise plans for a million dollars?

10:08>> No. Yeah. Absolutely. Yeah. In general, yes.

Nathan Latka

10:11Let's keep going in the funnel. We'll end with the customer story, which you just alluded to. They click these keywords from Google search. They land on this page. How did you get Mark Cuban to agree to this? And how is this converting for you? Well, I got Mark Cuban

Ross Buhrdorf

10:24>> to agree to this because, know, he saw a great product. I went and pitched him. You know, I went through the process and through my network. I think it was a long shot, but you know for all of the folks out of here, I mean, starting a business and again, want to get back to this is that when we help our customers, we feel like our customers. I mean, our employees have side hustles, we encourage it.

10:53>> We give them free subscriptions and it really drives the quality of the product.

Product strategy: launch, run, and grow

Nathan Latka

11:00Talk this is a good slide for you to talk about your product strategy and then we'll go into the banking action. So how are you bucketing your product strategy today?

Ross Buhrdorf

11:06>> Well, I mean I think it really is this launch, run and grow. So everything that you need to to launch, and this is becoming even more important. You know, when you do a formation, people come to me and say, hey, should I use a lawyer to do formation? I said, not. Not only will they do it wrong because they don't do tens and hundreds of thousands of these like we do. We make damn sure we do

11:31>> it right, have AI. So we do a great job on that, then they won't keep you in compliance, you know, depending on what state you go to. In New York, you have to put an advertisement in two newspapers. Did you guys know that? We facilitate that.

Nathan Latka

11:43To file an LLC in New York.

Ross Buhrdorf

11:45>> To file an LLC in New York. And and then there's all kinds of different states, you know, 50 jurisdictions and then the District Of Columbia. So there's just a bunch to for a compliance point of view, and it's it's important that you're you're up to date. And now they've got the new federal law, the Corporate Transparency Act that came out. We handle all of that for our customers too. So we make darn sure that they're handled.

12:07>> So that's that whole compliance piece. And then, know, just running your business, it's, you know, the taxes, the accounting, we do

12:16>> the invoices and payments.

Nathan Latka

12:17And Which of these business models right now generates the most revenue for you? The left side, taxes, accounting or the banking and finances?

Ross Buhrdorf

12:27>> I mean Or you don't think about it

12:30>> that We don't think about it that way. I mean it's it it it's Are

Nathan Latka

12:33you making money on a credit card? Are you taking 1.8% gross interchange? We're making money on everything. We otherwise, we don't Round of applause for making money on everything. Otherwise,

Ross Buhrdorf

12:42>> we don't otherwise, we don't do it. I mean, you know, I'm on a I mean, banking for us is really about, it's one of the, it's the number one, next to taxes is the number one thing that, that small businesses are worried about. Like, oh my god, I just did a formation. You know, what kind of a filing do I, you know, what kind of formation should I do and what are the tax implications. So we

13:05>> help them with that. The next thing they need is a bank account. You got to separate your finances. And I'll tell you, this is the greatest story which lines up with your previous speaker. So I'm training with my trainer. I'm in in his gym and I said, hey listen Bobby, if I get myself hurt here, I'm going to sue the hell out of you. You better get an LLC to protect yourself. He said, and I know

13:26>> who way you should do that. So he goes and does this whole process. Then And he comes to me, he says, hey, I want to use my local bank. Great. We're we're fine. We we we hook up to any bank you need to. And then the next question, which I knew he's gonna ask is like, how do I do that? Well, you know, you need to print out your formation documents. You're gonna have to make an

13:42>> appointment at the bank. You have to go down there and then wait a couple days for them to run the process. And then it pauses for a second. Well, what do I have to do to use your bank? Oh, you have to answer one question and push a button. Oh, I think

Nathan Latka

13:54What's the question?

Ross Buhrdorf

13:57>> You know what kind of business do you run?

Banking product, Joust acquisition, and Unit middleware

Nathan Latka

14:00And do they have to deposit a certain amount on day one or?

Ross Buhrdorf

14:02>> Well, no. I mean after that's just to get the process going.

Nathan Latka

14:05I

Ross Buhrdorf

14:06>> see. They just have to push a button, answer one question. It depends on what kind of business it is, what the question is. But they hit push button and that's it. And then the

Nathan Latka

14:16process starts. I'm going dig here for a second. There are lot of SaaS owners thinking about adding a Fintech place. A couple of quick questions here. Do you do KYC and AML internally?

Ross Buhrdorf

14:27>> Well, so the answer is yes.

14:28And

14:29>> with banking as a service now and there's a lot going on here is, you know, we sit behind a charter. And then we sit should be a Joust. Well now Joust was that was an early acquisition. And Joust got us into got us into fintech. Now we've evolved from now into banking as a service. So we use middleware piece of software. Oh you use? My gosh.

Nathan Latka

14:52Unit, treasury prime?

Ross Buhrdorf

14:53>> Unit. Unit.

Nathan Latka

14:54Okay. And then we've Who'd you get the charter from though, it wasn't from Joust?

Ross Buhrdorf

14:59>> That's the hard thing.

15:01>> No. No. We don't have a charter. We don't have a charter. So unit sits in front of a charter. And then there's many banks as a service.

Nathan Latka

15:07So Joust was a fintech that was sitting on somebody. They didn't own charter. I thought that's why you No. Did an No. No. They didn't own I see. A Okay. So you're sitting on unit. Unit plus you do the KYC It's a down a bank. Unit's general model is there. Do you get does Unit pay you kickbacks on deposits? You know, midpoint minus 75 or something? Yeah. I mean,

Ross Buhrdorf

15:25>> we we we

15:27>> yes, we make money at every I love this. Every part of it. Okay. What And it's great. And I mean that this is a to your previous speaker is what we do as a SaaS platform, we've already acquired the customer. So you know for a bank, I know right now I can give you a bank pays because I don't want a bank board, they pay up to $500 for a customer. We've already acquired that customer. We

15:48>> can either and we do a we do a deal with Bank of America. We send customers over to Bank of America if they want Bank of America because many of our customers want to write checks. Yep. We you know, most fintechs don't allow you to to write checks. Everything has to be How

Nathan Latka

16:01many credit cards do you have in circulation right now?

Ross Buhrdorf

16:04>> We tens of thousands.

Nathan Latka

16:06Tens of thousands. Wow. Okay.

16:07>> Yeah. And and and do you require minimum spend on them or no? Monthly?

Ross Buhrdorf

16:12No. Well, no. No.

Nathan Latka

16:13>> Do do you see patterns in how your customers are using the cards? Is it for Facebook ad spend or is it for something buying pens and Yes, I mean, mean,

Ross Buhrdorf

16:23>> just, yes. We see all kinds of trends. We see who's doing well. One of the things that's fun because we haven't done a deal with Shopify on the e commerce side yet, but we do see funds coming in from e commerce. A lot of our customers have Shopify as a website. We see that them pulling in the funds on a annual on a weekly

16:43>> monthly Shopify yet.

Nathan Latka

16:44Are you in acquisition talks with Shopify?

Ross Buhrdorf

16:47>> No. No. No. What? We're gonna acquire Shopify?

Nathan Latka

16:51No. You're quick. That was good. No. That was a good that was a good little turn there. No. But you know, I do like Is it a 10 x or 40 x multiple? For what? The Shopify or Well,

Ross Buhrdorf

17:01>> I mean, they're trading at nine x right now if you wanna know.

Nathan Latka

17:04So No. Mean Okay. So they're gonna are they buying you for right under that? So they get a little arbitrage on the

Ross Buhrdorf

17:09>> Yeah.

17:09>> Mean, here's the thing.

Nathan Latka

17:10So they are buying you?

Ross Buhrdorf

17:12>> Pardon?

Nathan Latka

17:13Shopify is acquiring you right now?

Ross Buhrdorf

17:15>> No.

17:15Okay.

Nathan Latka

17:16>> But I will say

Ross Buhrdorf

17:17I tried.

Nathan Latka

17:18>> I I will say that, you know, what I what I pitched to the the VCs, and we still really as a tenant of our business, what Shopify does for e commerce, Zen Business does for the service sector. So, you know, Shopify does an amazing job. I I watched all of their videos at their Investor Day. And if you you could have plugged me in for their CEO because we say the same thing. Yeah. Platform, product, ease

Ross Buhrdorf

17:44>> of use, that's what we're focused on.

Nathan Latka

17:47I wanna go back now. Look at that. There you go. I wanna go back to here. Yeah. And now I don't know how to quite ask this question, I'm just gonna ask it directly. Did you is it inappropriate for me to ask, did you make more than personally as CTO $10,000,000 on this deal that you could use to build Zen business afterwards?

Fundraising history: Series B, $205M round, and valuation

Ross Buhrdorf

18:02>> Oh,

Nathan Latka

18:03sure. Okay. So that's fair to say. So that's great. Probably much more. Here's my question. Did you sell too early? Airbnb is trading right now, a $100,000,000,000 valuation. You guys were second in line. You sold for 3,900,000,000. Yeah. I mean, I will I will tell you that

Ross Buhrdorf

18:19>> we retired. Okay. I mean, you know, at some and and even more than that and How many

Nathan Latka

18:27years were you building?

Ross Buhrdorf

18:28>> I mean, I think that was at eleven years. That's a long time. And I was the youngest executive there. And, you know, at some point, you know, after eleven years, it's like, guys, you know, I think it's time for us to move on. And I mean and and looking at Shopify, I mean, they threw up their whole executive staff and brought in new talent. And you know, I keep threatening my staff. I said, you know, let's

18:54>> get this thing done. We've got a few before more we

Nathan Latka

18:58That's awesome. Change out. Well, you're growing revenue. It's a great success story. Want talk about how you capitalize the business. You obviously were personally wealthy when you started, which is great. That gets you so far. But you decided to hit the you said I'm going all in on this thing. Take us through the day you signed a $55,000,000 Series B.

Ross Buhrdorf

19:14>> I'll just tell you that the whole thing because it's it's it's a blur. You're as a first time CEO, this was kind of my biggest worry. You know, I knew and I tell my CTO, Alex, who I've worked with for decades now. I said, Alex, man, you have the toughest job here. So I did not want to be a CTO Mhmm. After HomeAway. It was brutal. So I didn't have anywhere else to do. I was worried

19:39>> about raising money, you know, standing up here.

Nathan Latka

19:43But why? You were personally wealthy. You could have bootstrapped.

Ross Buhrdorf

19:47>> Well, I mean, you know, we just we raised the last round at 1,700,000,000 and raised, you know, $2.00 5,000,000

Nathan Latka

19:56Is valuation underwater today? Are the options underwater?

Ross Buhrdorf

19:59>> We're getting close to that valuation. So we're getting what was So we as we like to say and the investors like to say, we're growing into that valuation like the rest of the market. We're growing into that valuation. Yep. But if you ask me what my company's worth, it's worth that much.

Nathan Latka

20:13That's what you would point to. Yeah. This was this was 2021.

Ross Buhrdorf

20:16>> And we actually raised $2.00 5. We took five,

Nathan Latka

20:21I don't know when Secondary?

Ross Buhrdorf

20:22>> No, no, from someone. Can't remember at the time.

Nathan Latka

20:25Just some random extra 5?

Ross Buhrdorf

20:27>> Well, mean, I asked you and you said no. You weren't interested. But now we took in 205. Alright.

Nathan Latka

20:33So do I mean, this is important because there are some people in here that have raised at these valuations. You didn't have to manage anything for the downturn between 2021 and, like, even today still where there's compressed everyone's options are underwater. Did you have to do anything with a team to help them understand?

Ross Buhrdorf

20:45>> Well, think we repriced the options like a lot of companies did to make it happy for the customers. But, you know, we did a secondary too for a lot of the people.

Nathan Latka

20:59It wasn't In the '56 or the February?

Ross Buhrdorf

21:01>> Actually both. We did a

21:03>> little bit at both.

Nathan Latka

21:04How much did you do of the 200 in secondary for

Ross Buhrdorf

21:08>> the team? That's confidential. But I will tell you that what we we are we also pride ourselves on a great being a great company. It wasn't just for the the c level execs. Was

21:21for everybody

21:22>> that had vested that had been here over a year and had vested and then we did 10% of that. So wasn't crossword.

Secondary liquidity for employees

Nathan Latka

21:30To the team said, if you're past your one year cliff, we're closing a series c today. If you'd like to sell up to x percent of your best Yeah. Shares you can. On the series c, we did that. Series c? What percent of vested shares? What was the max any one employee at Zendesk could sell up to? It was 10%. Oh, 10% of How their vested many of them took it? What percent of employees

Ross Buhrdorf

21:49>> took Most everybody took it, it was surprising. Some people didn't,

Nathan Latka

21:53which was was Does it piss you off when they take it? You go, well, you don't believe in the long term vision.

Ross Buhrdorf

21:58>> When they take it? Yeah. No, man. You should always take money off the table. What are

Nathan Latka

22:01you talking I was trying to

22:02>> give you

22:03a softball. There you go.

Ross Buhrdorf

22:04>> I took money we took money off the table at Homeway also too. Everybody did. I mean, it's the you know, It I mean, how would

Nathan Latka

22:12you this is one of the biggest things when I meet with founders that are between one and ten million of revenue. They always think they can only, like, either bootstrap and take profits. Or if they go to an equity round, they don't necessarily know how to ask for the secondary. How would you recommend for someone in the sitting room right now with 7,000,000 of revenue? Let's say they want to go raise $20,000,000 but they really want

22:29to take $5,000,000 off the table to go buy a house or go on vacation. How should they ask for that when they put their data room together?

Ross Buhrdorf

22:39>> Maybe Yeah. I'm a little old fashioned on this one. I think that you know the numbers that we displayed in the competition we had for the round,

22:50>> you know, so it was a reasonable ask. So I think that's my, the way I view things. I don't think that, oh god, I'm going to sound old. Yeah, I mean, think we earned that secondary. How's that? Yeah. You know, we earned that secondary. And I think that the investors, you know, the way I said it is, you know, we've got a lot of young folks here that want to go buy houses and want to go

23:21>> do things. And I need them for the long haul. This is not, you know, a three year deal. Let's give them some money and take some money off the table. Take some risk off the table so they can focus on the business. And they're not worried about,

23:35>> you know, whether they can afford a house in Austin now or where we're a virtual company, so it's all all across the world.

Nathan Latka

23:42We've got about two minutes left. Okay. So you said you've done a bunch of acquisitions. Walk us through right now when you go in with your head of BD and etcetera, like today and the board and you go, hey, what should we go after next? How do you think about go forward M and A strategy?

M and A strategy and customer cross-sell

Ross Buhrdorf

23:52>> Yeah. I think it's just in general and again to a platform roll up. We're constantly talking to our customers, what do they want? We know exactly what they want. So we'll initially partner with a good partner and and figure out if this is a there's money in this market and if we should dive in. And so then the the point of diving in like we did with banking, we did Bank of America first, saw the great

24:19>> take rates, saw what was going on there, and so we did our own. So it's always the case of we try, then if it's something we want to acquire or build.

Nathan Latka

24:28Yeah. That makes a ton of sense. Do you have any targets that you want to share right now that are hot or close or ready to be announced?

Ross Buhrdorf

24:34>> We are constantly acquiring

24:36>> and constantly talking to companies because, again, what we have is this flow of incoming customers.

Nathan Latka

24:44So How many customers today?

Ross Buhrdorf

24:47>> Over half a mil over 500,000.

Nathan Latka

24:50That's wild. 500,000. Those are all actively paying? Well, not all of

Ross Buhrdorf

24:54>> them active. We've had 500,000 customers, but, you know, around 400,000 plus.

Nathan Latka

24:58That's great. And how do you get them from like the banking product? Like how do you cross sell? If you have 16 products, how do get them from one to two

Ross Buhrdorf

25:03>> to I'll tell you what. This is the magic of our business. So we spend a tremendous amount of time and money investing on getting the right product to the right customer at the right time. So we do that through every possible channel including outbound sales. So when they come through, we want them to have a great experience. They do. They have a great experience. We have the highest NPS in the segment. And in many consumer segments,

25:33>> we have the highest. So they're ready to purchase from them. We just have to make sure that we're giving them the right product that retains. Because can sell all of our products to our customers, but if they don't engage or activate with it, they're going to churn out of it. So what's the point?

Nathan Latka

25:50So is your net revenue retention today over 120%?

25:54That's confidential. That's It's above a 100? It's confidential. Can you give me a range?

25:59Low ball. It's really good. It must be 50%.

Ross Buhrdorf

26:02>> Yeah. Yeah. Yeah. Something like that.

Nathan Latka

26:05You don't wanna correct it,

Ross Buhrdorf

26:06>> you know? Nah. Alright. But definitely above 50%.

Nathan Latka

26:08Okay. There we go. But I mean, look at look

Ross Buhrdorf

26:10>> at if you look at what Shopify is now? Let me

Nathan Latka

26:13I don't know. What I don't know actually.

Ross Buhrdorf

26:14>> It's over a 100%, but they went out You know a lot about Shopify.

Nathan Latka

26:17Hell, yes. I know a

26:18>> lot about all of them.

26:19I just wanted you guys to know when you read this three months from now, you heard it here first. That's right. Shopify acquires Zen business for $1,900,000,000. Yep. Would you sell for 1.9?

Ross Buhrdorf

26:32>> No comment. Depend you know, it depends on what week it is. Wow. I feel it. That week. Some weeks, you know?

Nathan Latka

26:40It is either Monday or Friday.

Ross Buhrdorf

26:41>> Yeah. It depends.

Nathan Latka

26:42So, guys, a lot a lot of cross selling happening here, which is great. Is there anything Ross, we haven't caught up since 2021. Is there anything that's, like, key to your story that I missed that you want to make sure these founders learn?

Closing advice on customer success

Ross Buhrdorf

26:54>> Oh, you know, was thinking on the drive in here is that, you know, we kind of take for granted, at least I do coming from the, you know, where I came from SaaS business. It's kind of like we take it for granted. And the other thing is what we don't take for granted at Zen Business is our customers. You know, once you sell them, we're very good at converting customers. We got Mark Cuban, we got great

27:19>> branding, we focus a lot of time and effort on on this. And then but once you get the customer, that's when the business starts. And I worry that a lot of, including myself when I experience a a SaaS solution, You know, we spend a tremendous amount of time on our customers. We don't, oh, they converted. Okay. Let's get them to renew. It's, you know, once you sell them, that's when it starts. And I and I worry

27:49>> my team, they hear it from me all the time. But you know, you have to take care of your customers. It's not just getting them getting their credit card initially. It's okay. So now are you delivering value? Are you talking to them? Are they using the product? Are they referring us? You know, are we continuing to have this robust exchange of value? Guys, over

Nathan Latka

28:11the last twenty four minutes, you learned from someone who is the CTO for eleven years at HomeAway, made well over $10,000,000 on the exit and said you know what I want to get into the SMB space, help them launch something quickly, launched Zen business with six key products back in 2018, pivoted his pricing to simpler,

28:30Doubled revenue since 2021 from 40 to over $80,000,000 today. Last round $1,700,000,000 as they work to go under that valuation. Really helping anything they can do to help their over 500,000 active small businesses grow faster. Ross, thank you so much. Appreciate it. Give it up for Ross. Thanks so much.