We caught up with Tejas Mehta - who pivoted from a services business to a full fledged SaaS tool that competes with HootSuite et al - at a fraction of the price tag.
2M+ in ARR
Focused on agencies - 65% of their business is from agencies
Chills out in Louisville, KY!
Vivek Bhaskaran 01:26Good, good, good. Let's jump right into it. So you run a SAS platform that helps marketers automate social marketing. Is that a correct way of describing it. Tell me, tell me what it is. Yep.
Tejas Mehta 01:38That's absolutely right. So we don't have social social media publishing platform, which is used by assemblies and agencies to manage social media. So they usually publish, they look at the analytics and then they manage the inbox like
Vivek Bhaskaran 01:51Got it makes sense. How long have you guys been in business for
Tejas Mehta 01:54Six years now.
Vivek Bhaskaran 01:55Nice, how much I guess making 1.89
01:59Good, good. And do you have not raised money what I
Tejas Mehta 02:02Love is money. That's what
Vivek Bhaskaran 02:04Fuck those guys. Alright. Awesome. Yeah, I love it. So tell me a little bit more. So you have. So what's your gonna
02:11Agency to direct ratio, like, you know, obviously, you saw two agencies on yourself or somebody direct also right which I'm just curious, what's our agency to direct ratio, how to use. Look at that business.
Tejas Mehta 02:24So we are I think 65% agency business right now. And this has evolved over the years. So initially we were like, focusing on bloggers and then individual freelancers
02:33Right. But we realized quickly that that business owners don't work. So we moved on, like to higher value chain as in focusing on businesses.
02:39And then we realized that businesses have only so much of me. It's not like your core product core bread and butter. So we moved on to agencies and now over the years we have, I have now 65% of customers are agencies. Got it.
Vivek Bhaskaran 02:51And on the agency side are they small like really mom and pop agencies, they are you know 510 percent or not be larger and see how do you distribute that can get give us a sense of that distribution.
Tejas Mehta 03:02So most of our agencies are around 10 to 15 people and in the agency, you'd have like three or four or five people working on social media, along with everything else.
03:13Out of six 5% I would say 35 40% of agencies are in that range like til 10 people in the agency.
03:21And then like bigger agencies who have smaller social media.
03:25Teams, or like bigger larger agencies who have was very scattered teams and then multiple teams using autopilot. So it's, it's kind of mixture.
Vivek Bhaskaran 03:36Started and your pricing helping understanding of pricing. So you decided to go on a per user pricing. Is that how you do it. How do you price it
Tejas Mehta 03:42We can we do it on an account. So for example, if an agency has an account with us. So that's the price for the account and then we can add
03:49A number of team members. So each. So there are three price points that we currently have. And this one comes with like certain number of team members, you can add, I don't do it as a charge. Okay.
Vivek Bhaskaran 04:01And do you differentiate between the price tiers based on kind of features and functionality or is it just like you get all the features, but based on kind of usage. How did you decide what the features are such usage. How did you decide that
Tejas Mehta 04:12So its a mix of both. There's a value based pricing component, obviously. So there are certain features available only on small team emergency plan.
04:19Which are like the two high plans and then the other factor that comes into picture is the usage in terms of number of accounts that you connect with the social pilot and then the number of hosts study published on a daily basis, sociable.
Vivek Bhaskaran 04:30Got it. So it's like the usage is the number of accounts and the number of posts on those accounts.
04:35That's right. So that's kind of your, the more you use, the more you pay. So that's how you can capture that value and then on this side, there's like a number of Justin on bucketing number of us the number of administrators and operators of the system, realistically, right.
Tejas Mehta 04:49That's why I
Vivek Bhaskaran 04:50Got it helped me understand like kind of your growth trajectory. Also, so obviously you're making 2 million bucks right now. So, so at some point zero. So zero to to, like, Help me understand how did that. How did that go around, like, you know, telling a story.
Tejas Mehta 05:04And I think the context would really help. So this really is a in house project that my co founder
Vivek Bhaskaran 05:11All company started in our projects, don't worry about it right every
Tejas Mehta 05:16You're very proud of it. So I'm not hiding fact right
05:19My co founder was also the CEO, he was running a services company for digital like websites and the legal stuff right and he realized that a lot of
05:28e commerce agencies do not have like a way to market their products social pilot was originally created in house to experiment. If we can service those e commerce companies that are coming into, you know, build the websites with us.
05:41And we experimented in we realized that it's it's worked out fine. And then the customer started asking if they can use the product and then they wanted to pay for it.
05:48If we build this feature that feature, etc. So the dream we are building the product like customers asking for features and paying for it. Yep.
Vivek Bhaskaran 05:57So you started off as an agency and you
05:59Were basically using the tool internally for your customers and then you spun it out. Do you help me understand how do you spell it out a separate company do you kind of run it as part of the agency and then spin it out. How did that go about
Tejas Mehta 06:09So initially for the first year we had zero revenues, while we were building product, obviously. So it was a part of the agency.
06:16And again, this was my co founder running it. I was not a part of the agency, but I was like advising helping him since I was like
06:23done a lot of things I here in the US. I wanted to kind of help them out.
06:27So that's, that's how we started. So initially for the first year it was part of the agency. And then once the money started coming in. He said, let's turn it off as a different company. So that's where we kind of got out of the agency business. Totally. And then focus on the product.
Vivek Bhaskaran 06:40Do you shut that I'm curious, do you shut down the agency business or do you get out of it do you spell it out and glad that somebody else, run it. Would you do that.
Tejas Mehta 06:46We shut it down because the best developers when the agency. So we don't want to do developers so
Vivek Bhaskaran 06:51Yeah, you just read the entire thing and just bought it. So you
06:55Truly pivoted from a services to a SAS company.
06:58That's right, like
06:59Truly, like it's not like just kind of like you know and and
07:03That's that's awesome to hear. So see, I see a lot of times where, like, people are within agencies, they come up with amazing ideas, but they kind of stick it with side agency and never kind of the products never become real products right because they're still
07:16part of a larger agency. And then there's always this kind of like friction between the services on the product side.
Tejas Mehta 07:22That's true. And I will been like logic unfolding of things before sociable and I've seen like products great ideas coming in inside the
07:31Organization and then dying out because there was no sponsor because it was not making money. And then he servicing a larger BFS our account is making more money than working on this product. So why work there. So I totally believe that human right.
Vivek Bhaskaran 07:43Yeah. Yeah, so I think I'm glad that you guys like you know pretty much shut that down and you guys gonna build this. So tell me a little bit about
07:50Kind of your kind of layout. So I know you have a couple of couple employees here a couple of folks here and group in India, give me the scope of kind of your kind of how you guys manage operations.
Tejas Mehta 08:00So we have her business development.
08:04Person here in New York and then I am here in Kentucky Louisville, Kentucky. So the entire team is based out of India. So all of our marketing all of our product development engineering customer support happens from India. Got it.
Vivek Bhaskaran 08:18And do they run 24 seven cycles, the idea of the whole thing operator operationalize
Tejas Mehta 08:22So customer support and success is 24 7345 weekdays, but engineering is just like normal India time 10am to 7pm.
Vivek Bhaskaran 08:32Got it, got it. So, so I gotta ask you, man. Louisville, Kentucky.
08:37Yeah, really good. No, it's good but you gotta tell me the story like I know how come you're hanging out in Louisville, Kentucky. There's gotta be a story there.
Tejas Mehta 08:48Sure. So I used to live in Los Angeles to like last year 2019 July and then my wife suddenly decided to kind of got an offer for residency in dentistry here in Louisville and she's like, hey, can we move. And I'm like, Sure, I mean even the office. I'm working from home, so why not
Vivek Bhaskaran 09:08Well, right now, nobody's going to the office. Anyway, so you're the. You're the man. Right now you're the you're the boss right now. You're like, Fuck all the up vote.
09:15I'm hanging out in Louisville, Kentucky, and making the same amount of money, and if not more elite right so it's it's crushing it. So give me a sense of like the revenue growth, how, how, how has that been any challenges you've faced can tell me, tell me.
09:28Tell me, what was the headwinds for you.
Tejas Mehta 09:30So because we did not have like SAS macro per se. So we didn't realize that there's a concept called monthly recurring revenue, like we did not know that recurring revenue was something that we need to measure.
09:42Back in the day, we were just mentioning revenues that hey this month per week in the bank. Awesome. Let's celebrate right and then we
09:50Down the line realize that hey revenues to not make sense. What matters is how much growth are you building by making the revenue recurring. So back in 2016
10:02I would like to see a 16 we were like at 22 way, Mr. And from there, like we don't have any focus on the product. We like just copying the competitors trying to gather and again all any customers that would come in.
10:15And then we said this is not working out with a focus on like one business line and then kind of expand go after it or we kind of shut this down and go back to services.
10:25And me then took a bath. He said, Let's focus on SMEs and you know that's where we started growing. So over the years, the growth rate has been like pretty much stable, it's, it's been three to 4% month on month which is net of john
10:41So we'd not have outside capital and hence you know we're not aggressively growing in terms of growth, at any rate, so that that doesn't happen with us and we're constantly kind of growing happy without stress why
Vivek Bhaskaran 10:5430% 30% analyzed is pretty good. I would say like, you know, keeping everything I think everybody is asking for 200%, you know, it's all right. It's good. Yeah, but you know
11:04You can do 30% and so you know it's gonna, you know, you can do the math of a couple years you'll get to 10 MILLION BUCKS. Now, it's not about deal honestly and you own and you own all the equity in the company and you can do kind of, you can do what you want.
11:17In terms of what do you think I always wondered like, you know, do you need when you have you know you said you had that 6535 agency versus direct split
11:27I've seen some companies that really like almost design a solution for agencies, right, like the tool itself is like kind of like super designed for agencies.
11:38Are you guys thinking about going that route and say, like, like we our target market is going to be all the agencies and even focus more are are what are your thoughts. I'm curious.
Tejas Mehta 11:48So we are aggressively building product towards the target market. One of the reasons being. This is a must have for agencies.
Vivek Bhaskaran 11:56Direct. Right, right. That's, that's a good way of thinking about, like, it is like without this tool they cannot function they they know this is almost like a RP for agencies like they need a social platform.
Tejas Mehta 12:06That's right.
12:07You know, that was for small businesses, they could, they could use. So if you look at Facebook, right. So we have come up with your own creator studio
12:13To to have their own, you know, tweet deck, which is free. So if you're running like one or two accounts. You don't need social Berlin or any other software, we can just go to Facebook and skinny retweets or both square right
12:23What's this for agencies, they, they are managing like hundreds of accounts, they need a solution like this. So we are focusing aggressively on the agency side.
12:30Having said that, we have legacy customers aren't SMEs and we continued to kind of gain more customers and assembly. So we don't plan to kind of you. No problem. Have a
12:39sustainable solution for them. We are very much focused on the competitive advantage of pricing and support and service and we would continue to provide that. But our focus would be on agencies.
Vivek Bhaskaran 12:49Got it. And on the agency side and you're focusing on like the sub 20 user agency realistic and not the not the really large ones because they are, they have a different you know your
12:59Your I love it that you're like super focused and you figured out that, like, you know,
13:03Selling into agencies. That's the key part is like when you sell into somebody is your tool, kind of like, you know, you know,
13:09Absolute must have for them really right. So that's a good way of going to for that persona really the person that you're selling into if it's a must have been like code or not they can still pay you one way or the other.
13:23Is that is this thing affecting you at all. I doubted, but tell him you know is this, is this good stuff. I mean not not primarily but secondarily did is it affecting your. Do you have been to agencies of healthcare are in the travel and leisure space.
Tejas Mehta 13:35We have agencies in traveling between space and we have smaller agencies, which was starting up and then they were affected because your customers could not, you know, pay them so they will. Happy to be switched off their business, etc. And
13:48Right, it's pretty sad, but at the same time. Overall I think we're experiencing growth because a lot of people are going online and you know
13:56Publishing on social media is like the next level of marketing for mom and pop stores and they have started doing it themselves. So they start conducted the agency.
14:05Who can specialize on SMEs, right, and hence those agencies are like coming into tools like social pilot. The other factor that we also see is our companies are very expensive, like we are twice the cost tries to cost and then
14:20They are experimenting with like a cheaper product like us and then realizing that cheaper does not mean like
14:26Aggressively price competitive does not mean really, really cheap or lack of functions. Right.
14:30And they realize that it does not mean lack of customer support and then you kind of start liking it, and they expand and they, you know, grow on the so it says working out well for us because everything is going online.
Vivek Bhaskaran 14:41Right. I mean, yeah, definitely. Everything, everything is online and that acceleration is obviously happening.
14:48Ad nauseum. So tell me a little bit about what's next. Where do you see where do you see in the next couple of years be, you know, new products, new markets new geo markets. So what you're gonna like, what's your, what's your horizon.
Tejas Mehta 15:00So we last year 2019 we we did a lot of customers search right and what what came across to us talking to like several agencies.
15:10Here, the US India UK extra is agencies do not have like a go to solution for various things right.
15:17So there's obviously bigger players like sprinkler focused on enterprises or Hootsuite and Sprout Social which are like hundreds of thousands of doctors
15:25But at the same time, the customer service, you know, just really does not scale up to the expectation. So what we realized in 2019 is that our sweet spot is helping agencies grow with us and we grow with them.
15:39How can we provide enterprise class product to growing agencies so that they can afford it. At the same time, expect like
15:48Class A customer service. And if we can do that for social media. We can do it for other products in agency well as well. So be it reputation management lead SEO management reporting. So that's the kind of part that we're currently working on
16:04And trying to kind of create a agency in a box.
16:06Or agency sweet kind of solution.
Vivek Bhaskaran 16:09Right, so you're even expand into the lateral functions that the agency needs.
16:13That that that scope of agencies, the sub
16:17The, the five to 20 user agency needs. So you kind of roundabout and say, like, okay, do the other six or seven or, you know, slowly over the next couple of years, you're going to kind of build that out good.
16:27That's right, good. I went on the table on your. Do you have any questions for me. We going to do this thing. Double bi directional you have any questions, and we, you know, usually Romy and I on this, but today room.
16:38Your bail bailed on me. So I'm going to do this thing. You can ask a question to me.
Tejas Mehta 16:42Awesome. What's your room and how did you start and like what does the initial target customer, where are you now into the targeting customers.
Vivek Bhaskaran 16:49I yeah so I've been added for quite a while. So I started back in 2005 and you know again like almost all stories that are there, you know, randomly serendipitously bumped into something or the other you know
17:01We got lucky on SEO be brutally honest with you. So we did SEO before SEO was cool. And so we got a lot of customers just based on SEO. So that was
17:09You know, back in the day was much easier to do SEO. It's clearly a lot more complicated lot more difficult to do a lot more people are doing it today.
17:17And yeah, and one thing led to the other. And, you know, and one of the things that we like you. We invested in India we inserted, you know,
17:24We have a big game in India and the thing that that actually worked for us. Another thing we actually do not only, you know, engineering and support. And we also do sales out of India. So a lot of our sales globally.
17:34Over 24 seven sales operation that runs globally out of India.
17:38That's kind of like our commercial layer than we have in market teams for our enterprise layer so
17:43I will tell you that. Let me. I think our growth. Honestly, like I think almost for all SAS companies is like you know as you go, you know, figuring out
17:50Figuring out the target like really well and that are going out kind of increasing the value prop on that target really and you've i think i think you've nailed it with agencies and say, like, okay, that's my
18:00Target Audience like the five to 15 they need it in the story. They can't function without a tool like yours, it's not like a nice to have like there. And if you want to start a you know 15 person.
18:10You know, marketing agency like you need you need we need five tools. If you're not really function without, you know, email marketing social monitoring social
18:19Posting you know bunch of different things, really. So, and you are you're part of that. So I think it's great that you
18:27It's good to see you know I frankly like that focus really that focus gives you kind of, I mean, I think you're going to do really well.
18:35In terms of planning. I'm just an morbidly curious on a personal level you're hanging out at you know in in in Louisville a given given nobody's more in anywhere, anytime soon. So it's a, how long are you going to be there. Just give me, give me. I'm just curious, so
Tejas Mehta 18:50Episode 2021 you like best.
Tejas Mehta 18:56She wants to
Vivek Bhaskaran 18:58She, she forgot her whatever she gets a job, then you move that right there you go. You're gonna follow. Yeah, exactly. You know,
19:05She's The Boss and see like this is a great conversation. Thank you so much for hanging out and thanks so much for sharing your story with us.
Tejas Mehta 19:12Absolutely. Thank you.