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Nov 24, 2018 · 15m · top-founders

1218 This Browser Notification Company Just Hit 400 Customers, $600k ARR

Vivek Khandelwal · 7m spoken Nathan Latka · 5m spoken
0:00 / 0:00

gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions

In this episode of The Top Entrepreneurs, host Nathan Latka interviews Vivek Khandelwal, founder of browser push notification platform iZooto, exploring how the venture bootstrapped its way to 54,000 dollars in monthly SaaS revenue with negative net churn and strong unit economics.

How this conversation actually went

Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Nathan holds 42.4% of the talking time here. How this is scored →

Nathan as informed peer 5.0 Guest teaching 2.8 Guest disagreement 1.0 Nathan pushing back 3.3
05100:0010:001:40–6:43 · Nathan as informed peer 4/10 iZooto Product Functionality and Pricing Strategy Nathan digs into the founder's previous background and how telecom monetization worked, pressing for clarity when he doesn't understand the model. Vivek patiently explains balance alert advertisements and leaving his prior venture.6:43–10:34 · Nathan as informed peer 6/10 Bootstrapped Team Structure and Dual Revenue Model Nathan drills down on the customer numbers and ARR math, noticing the revenue discrepancy. Vivek explains the dual business model where publishers monetize native ads versus retailers paying direct SaaS fees.10:34–13:11 · Nathan as informed peer 5/10 Customer Acquisition Cost and Inbound Channels Nathan asks about CAC and payback math, and teases Vivek about when he will close BuzzFeed when Vivek brings up BuzzFeed as a hypothetical customer example.13:12–15:22 · Nathan as informed peer 5/10 Customer Lifetime Value and Unit Economics Analysis Nathan calculates LTV live, correcting Vivek when Vivek quotes monthly ARPU instead of total cumulative lifetime value before concluding with the standard Famous Five.1:40–6:43 · Guest teaching 3/10 iZooto Product Functionality and Pricing Strategy Nathan digs into the founder's previous background and how telecom monetization worked, pressing for clarity when he doesn't understand the model. Vivek patiently explains balance alert advertisements and leaving his prior venture.6:43–10:34 · Guest teaching 4/10 Bootstrapped Team Structure and Dual Revenue Model Nathan drills down on the customer numbers and ARR math, noticing the revenue discrepancy. Vivek explains the dual business model where publishers monetize native ads versus retailers paying direct SaaS fees.10:34–13:11 · Guest teaching 2/10 Customer Acquisition Cost and Inbound Channels Nathan asks about CAC and payback math, and teases Vivek about when he will close BuzzFeed when Vivek brings up BuzzFeed as a hypothetical customer example.13:12–15:22 · Guest teaching 2/10 Customer Lifetime Value and Unit Economics Analysis Nathan calculates LTV live, correcting Vivek when Vivek quotes monthly ARPU instead of total cumulative lifetime value before concluding with the standard Famous Five.1:40–6:43 · Guest disagreement 1/10 iZooto Product Functionality and Pricing Strategy Nathan digs into the founder's previous background and how telecom monetization worked, pressing for clarity when he doesn't understand the model. Vivek patiently explains balance alert advertisements and leaving his prior venture.6:43–10:34 · Guest disagreement 1/10 Bootstrapped Team Structure and Dual Revenue Model Nathan drills down on the customer numbers and ARR math, noticing the revenue discrepancy. Vivek explains the dual business model where publishers monetize native ads versus retailers paying direct SaaS fees.10:34–13:11 · Guest disagreement 1/10 Customer Acquisition Cost and Inbound Channels Nathan asks about CAC and payback math, and teases Vivek about when he will close BuzzFeed when Vivek brings up BuzzFeed as a hypothetical customer example.13:12–15:22 · Guest disagreement 1/10 Customer Lifetime Value and Unit Economics Analysis Nathan calculates LTV live, correcting Vivek when Vivek quotes monthly ARPU instead of total cumulative lifetime value before concluding with the standard Famous Five.1:40–6:43 · Nathan pushing back 3/10 iZooto Product Functionality and Pricing Strategy Nathan digs into the founder's previous background and how telecom monetization worked, pressing for clarity when he doesn't understand the model. Vivek patiently explains balance alert advertisements and leaving his prior venture.6:43–10:34 · Nathan pushing back 4/10 Bootstrapped Team Structure and Dual Revenue Model Nathan drills down on the customer numbers and ARR math, noticing the revenue discrepancy. Vivek explains the dual business model where publishers monetize native ads versus retailers paying direct SaaS fees.10:34–13:11 · Nathan pushing back 3/10 Customer Acquisition Cost and Inbound Channels Nathan asks about CAC and payback math, and teases Vivek about when he will close BuzzFeed when Vivek brings up BuzzFeed as a hypothetical customer example.13:12–15:22 · Nathan pushing back 3/10 Customer Lifetime Value and Unit Economics Analysis Nathan calculates LTV live, correcting Vivek when Vivek quotes monthly ARPU instead of total cumulative lifetime value before concluding with the standard Famous Five.

speaking balance: gold is Nathan, purple is the guest (3 minute bins)

0:00 · Nathan 70% · guest 30%0:00 · Nathan 70% · guest 30%3:00 · Nathan 22.3% · guest 77.7%3:00 · Nathan 22.3% · guest 77.7%6:00 · Nathan 33.6% · guest 66.4%6:00 · Nathan 33.6% · guest 66.4%9:00 · Nathan 40.2% · guest 59.8%9:00 · Nathan 40.2% · guest 59.8%12:00 · Nathan 33.4% · guest 66.6%12:00 · Nathan 33.4% · guest 66.6%15:00 · Nathan 75.9% · guest 24.1%15:00 · Nathan 75.9% · guest 24.1%
Sharpest disagreement ▶ 12:31 Clarifying BuzzFeed is not a client

Vivek quickly corrects Nathan that BuzzFeed was purely an example rather than a customer when Nathan assumes they are signed.

 Hardest push from Nathan ▶ 14:04 Pushing for aggregate LTV instead of ARPU

Nathan interrupts Vivek's low number to clarify that he is asking for total lifetime value across the entire customer lifespan rather than monthly rate.

 Biggest teaching moment ▶ 7:28 Explaining the publisher ad network model

Vivek clarifies that their 98k monthly gross comes from both direct SaaS subscriptions and an AdSense-style revenue share for publisher notifications.

 Nathan holds their own ▶ 7:15 Spotting ARPU mismatch against stated revenue

Nathan instantly does the math multiplying 400 customers by the stated ARPU, detecting that the total revenue number requires higher pricing or a secondary model.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
iZooto Product Functionality and Pricing Strategy 4313 Nathan digs into the founder's previous background and how telecom monetization worked, pressing for clarity when he doesn't understand the model. Vivek patiently explains balance alert advertisements and leaving his prior venture.
Bootstrapped Team Structure and Dual Revenue Model 6414 Nathan drills down on the customer numbers and ARR math, noticing the revenue discrepancy. Vivek explains the dual business model where publishers monetize native ads versus retailers paying direct SaaS fees.
Customer Acquisition Cost and Inbound Channels 5213 Nathan asks about CAC and payback math, and teases Vivek about when he will close BuzzFeed when Vivek brings up BuzzFeed as a hypothetical customer example.
Customer Lifetime Value and Unit Economics Analysis 5213 Nathan calculates LTV live, correcting Vivek when Vivek quotes monthly ARPU instead of total cumulative lifetime value before concluding with the standard Famous Five.

Statements from this episode (13)

Disclosure
iZooto's pricing scales with opted-in subscriber count
“So we, our pricing is based on their growth metric, which is their, which is the number of subscribers who have opted in to receive notifications.”
Vivek Khandelwal Nov 24, 2018 ▶ 2:31
Disclosure
iZooto's team comprises four co-founders and 32 employees
“We're about four founders right now. And we have now about 32 people.”
Vivek Khandelwal Nov 24, 2018 ▶ 6:52
Disclosure
iZooto generates $54K monthly SaaS and $55K ad monetization revenue
“SaaS is about 54,000 right now. The non-recording revenue has again been fairly consistent and recurring as well, but again, because it's not really classic classic revenue, that's about another 55,000 dollars.”
Vivek Khandelwal Nov 24, 2018 ▶ 8:17
Disclosure
iZooto experiences approximately 5% monthly logo churn
“We've been sort of able to control churn now so far to about yeah probably about five percent, right, of our yeah, On a monthly basis, right?”
Vivek Khandelwal Nov 24, 2018 ▶ 8:54
Disclosure
iZooto operates with net negative revenue churn
“Okay, from a revenue point of view, we have net negative churn as of now.”
Vivek Khandelwal Nov 24, 2018 ▶ 9:13
Disclosure
iZooto grew from $16K monthly revenue last April
“We were at about 16,000 dollars in last April.”
Vivek Khandelwal Nov 24, 2018 ▶ 10:26
Assertion Not checkable as stated
iZooto's customer acquisition cost ranges from $1,200 to $1,500
“We spent close to about, I think, 1012 200 to 1500 dollars on a monthly basis.”
Vivek Khandelwal Nov 24, 2018 ▶ 10:43
Assertion Not checkable as stated
iZooto's monthly ARPU increased from $125 to nearly $200
“Our output was about a 125 dollars a month earlier on, right? We're now kissing 200 for sure.”
Vivek Khandelwal Nov 24, 2018 ▶ 11:06
Assertion Not checkable as stated
10% to 20% of iZooto's monthly deals are annual contracts
“So we get about, you know I think 10 to 20% of our monthly deals are annual.”
Vivek Khandelwal Nov 24, 2018 ▶ 11:34
Assertion Not publicly verifiable
Yahoo Taiwan uses iZooto for browser notifications
“Our customer, though, is, for example, Yahoo Taiwan, right?”
Vivek Khandelwal Nov 24, 2018 ▶ 12:44
Assertion Not checkable as stated
Typical iZooto retail customers stay for 10 to 13 months
“My sense is a typical retailer of ours, right, would sort of last with us from the internet we've seen so far at least 10 to 13 months, at least.”
Vivek Khandelwal Nov 24, 2018 ▶ 13:16
Assertion Not checkable as stated
iZooto retail customers expand to $300-$400 monthly spend over time
“Oh, over a lifetime, they would end us paying us somewhere around 300 to 400 dollars towards the end of their cycle, typically.”
Vivek Khandelwal Nov 24, 2018 ▶ 13:41
Assertion Not checkable as stated
iZooto's retail customer lifetime value is approximately $3,000
“So you could, so you're looking at just about 3000 dollars.”
Vivek Khandelwal Nov 24, 2018 ▶ 14:11
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