SaaS: Here’s How RFP Scout 3x YoY to $1.2m+ in MRR

Alex

In Episode #783, Nathan interviews Alex Yakubovich. He’s the co-founder and CEO of Scout RFP. Prior to Scout, he was a co-founder of another startup which was acquired by LivingSocial in 2012. At that company, he led the operations team and helped the company become the largest online ordering providers in the country. He attended Case Western Reserve University where he studied mechanical engineering.

Famous Five:

  • Favorite Book? – Shoe Dog
  • What CEO do you follow? – Marc Benioff
  • Favorite online tool? — Salesforce
  • How many hours of sleep do you get?— 7
  • If you could let your 20-year old self, know one thing, what would it be? – Take big risks

Time Stamped Show Notes:

  • 02:25 – Nathan introduces Alex to the show
  • 02:58 – Scout RFP helps companies make online purchases by finding suppliers and the best deals
  • 03:14 – One of their newest customer’s is Beam Suntory who makes Jim Beam bourbon
    • 03:56 – They use Scout RFP to source for the best deals on raw materials that they use to make their liquor
  • 04:15 – Scout RFP is a SaaS model
  • 04:20 – Scout RFP charges per user basis
    • 04:47 – They charge only the buyers who are making the purchase and not the suppliers
  • 05:00 – Scout RFP also has different tools that they offer depending on the plans
  • 05:34 – Average per seat is $5K annually
    • 05:53 – All contracts are annual contract
  • 05:59 – Scout RFP has raised capital: $27.5M in total
  • 06:27 – Alex’s last company just raised $500K and it had a great exit
  • 07:00 – Alex has thought about what it’s like to have big companies involved in your company
  • 07:30 – The capital allowed them to not skim and invest on growth upfront
  • 07:49 – Current team size is 50
    • 07:59 – Half is the engineering and product side and half is for the sales side
  • 08:29 – The exit price of the first company was in the tens of millions
  • 09:37 – Alex has co-founders who were with him in the first company
  • 10:43 – There are over 100 companies that use the platform
  • 11:10 – The number of seats per company depends on the company
  • 11:54 – Scout RFP has overall users and paid users
    • 12:12 – Paid users is more than 3K
  • 13:05 – Scout RFP is part of Silicon Valley Sourcing Leaders Group
    • 13:31 – The group is about networking and sharing information and knowledge
    • 13:49 – There are now sourcing leaders programs in New York
    • 14:00 – The group helped Scout RFP to acquire new customers
    • 14:30 – The organization hosts their companies
  • 15:18 – Gross customer churn
  • 15:31 – Logo churn is not that high
  • 16:00 – Scout RFP has 17% net negative churn
  • 16:58 – Scout RFP has a customer success team, a sales team, ADPR team and management team
  • 17:38 – As a business grows with Scout RFP, the LTV grows as well
    • 18:22 – The average deal size per business is quite consistent, about 10
  • 19:09 – CAC to LTV ratio is 3
  • 19:25 – Payback period is around 15 months
  • 20:17 – Paid acquisition costs are around $40K a month
    • 20:49 – They do LinkedIn ads, some Facebook and Google, and a lot of tradeshows
  • 21:23 – Gross margin is 85-90%
  • 21:44 – Target ARR this 2017
    • 22:14 – Scout RFP is currently over $1.2M in MRR
  • 23:54 – The Famous Five

3 Key Points:

  1. An acquisition is an opportunity to build a bigger and better business.
  2. Being in a group with your target market is a big opportunity for you to acquire new leads.
  3. Let your big questions guide you in growing your business.

Resources Mentioned:

  • Simplero – The easiest way to launch your own membership course like the big influencers do but at 1/10th the cost.
  • 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
  • GetLatka – Database of all B2B SaaS companies who have been on my show including their revenue, CAC, churn, ARPU and more
  • Klipfolio – Track your business performance across all departments for FREE
  • Hotjar – Nathan uses Hotjar to track what you’re doing on this site. He gets a video of each user visit like where they clicked and scrolled to make the site a better experience
  • Acuity Scheduling – Nathan uses Acuity to schedule his podcast interviews and appointments
  • 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
  • Show Notes provided by Mallard Creatives