Raised $150k Then CTO Left, Now He’s Cruising $30k MRR with LeadFuze CEO Justin McGill

justin-mcgill

In Episode #537, Nathan interviews Justin McGill. He’s an entrepreneur and owned a startup in 2008 when he started a digital agency. After he scaled that out, he launched LeadFuze – a B2B lead generation platform. He’s also the co-host of Zero to Scale Podcast which gives us a behind the scenes look at growing a startup with 200K per month in MRR.

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Famous Five:

  • Favorite Book? – The Ultimate Sales Machine
  • What CEO do you follow? – Elon Musk
  • Favorite online tool? — ZenPayroll which is now Gusto and Bench.co
  • Do you get 8 hours of sleep?— No
  • If you could let your 20-year old self, know one thing, what would it be? – Justin would’ve told himself that entrepreneurship was a path in life he could take

Time Stamped Show Notes:

  • 01:50 – Nathan introduces Justin to the show
  • 02:15 – LeadFuze is a software platform
    • 02:21 – LeadFuze allows to you to search for contact information and automate the outreach to ideal and prospective customers—turning them into possible sales opportunities
  • 02:35 – LeadFuze is a subscription-based company
  • 02:55 – Average MRR is $175
    • 03:08 – Early stage companies are using LeadFuze
  • 03:25 – Average number of customers
  • 03:45 – LeadFuze started off completely bootstrapped and had a small raise of $150K
  • 04:26 – Justin shares why he decided to take capital
  • 04:43 – Justin did a small equity round
  • 06:10 – If you’re trying to grow your sales, LeadFuze can help you
  • 06:43 – LeadFuze is web-based
  • 07:00 – LeadFuze wants to focus exclusively on lead generation
  • 07:24 – LeadFuze is a software with a service
  • 08:14 – Gross customer churn and revenue churn
    • 08:35 – “Customers stay for 6 months or so”
  • 09:15 – Why not just charge $175 upfront?
    • 09:31 – LeadFuze is currently a product company without engineering help
    • 09:47 – Justin is trying to look for a CTO
  • 10:58 – Justin shares why his CTO left
  • 11:57 – Current team size on remote
    • 12:18 – About to open an office in Phoenix, AZ
  • 12:30 – LeadFuze has 3 co-founders, one who was Justin’s sales coach
  • 13:55 – CAC
    • 14:05 – Around $300
  • 14:28 – Justin invested in content and that is what driving the signups at the moment
  • 14:50 – LeadFuze offers 20 leads for free
    • 15:02 – 8.5% of the signups convert from free trial to paid
    • 15:10 – Free trial doesn’t require a credit card
  • 15:40 – Total 2015 revenue
    • 15:50 – LeadFuze started totally free
    • 16:11 – Average total cash flow by the end of 2015 is around $250K
  • 16:45 – Some of the sources where LeadFuze pulls data are from ClearBit, Full Contact, and Tower Data
  • 17:23 – Hit Justin up on Twitter
  • 18:55 – The Famous Five

3 Key Points:

  1. As a startup, the pay-as-you-go model may be more beneficial than subscription plans.
  2. Entrepreneurs need to be more open about their people leaving.
  3. Don’t waste time and TAKE the leap as early as you can.

Resources Mentioned:

  • Acuity Scheduling – Nathan uses Acuity to schedule his podcast interviews and appointments
  • Drip – Nathan uses Drip’s email automation platform and visual campaign builder to build his sales funnel
  • Toptal– Nathan found his development team using Toptal for his new business Send Later. He was able to keep 100% equity and didn’t have to hire a co-founder due to the quality of Toptal
  • Host Gator– The site Nathan uses to buy his domain names and hosting for the cheapest price possible.
  • Audible– Nathan uses Audible when he’s driving from Austin to San Antonio (1.5-hour drive) to listen to audio books.
  • The Top Inbox – The site Nathan uses to schedule emails to be sent later, set reminders in inbox, track opens, and follow-up with email sequences
  • Jamf – Jamf helped Nathan keep his Macbook Air 11” secure even when he left it in the airplane’s back seat pocket
  • ClearBit, Full Contact, and Tower Data Where LeadFuze pulls its data
  • @Jus10McGill – Justin’s Twitter handle
  • Show Notes provided by Mallard Creatives

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