The Exchanges

Q Yeah. Very good. All right. And talk to me a little bit more about how you've capitalized the business. Obviously you were not the original founder and you went into how that kind of changed in the last episode. So we won't rehash that, but are you raising additional capital or has your VC backers? Are they saying, Hey Steve, do you need more?

A Uh, we are fully bootstrapped. Uh, so we have no, we have no capital, much less additional capital at our hands. And so I think that's, that comes with pros and cons. Uh, in this crisis, it is a particularly good time to be a bootstrap company because we had to learn to lead, live lean for a really long time. Uh, and so, um, we, the, the one access to capital that I'm looking at, I'm waiting for a call right now is from the payment protection loan program. Uh, Um, which the government made available. We're all trying to figure out and how that can give us an extra level of assuredness to, to keep the staff that we have for as long as humanly possible.

AI assessment note: “we are fully bootstrapped. Uh, so we have no, we have no capital”

Q Yeah. Very good. All right. And talk to me a little bit more about how you've capitalized the business. Obviously you were not the original founder and you went into how that kind of changed in the last episode. So we won't rehash that, but are you raising additional capital or has your VC backers? Are they saying, Hey Steve, do you need more?

A Uh, we are fully bootstrapped. Uh, so we have no, we have no capital, much less additional capital at our hands. And so I think that's, that comes with pros and cons. Uh, in this crisis, it is a particularly good time to be a bootstrap company because we had to learn to lead, live lean for a really long time. Uh, and so, um, we, the, the one access to capital that I'm looking at, I'm waiting for a call right now is from the payment protection loan program. Uh, Um, which the government made available. We're all trying to figure out and how that can give us an extra level of assuredness to, to keep the staff that we have for as long as humanly possible.

AI assessment note: “we are fully bootstrapped. Uh, so we have no, we have no capital”

Q So how, how do you guys think about, you don't need to think about this really because you're not, you're not raising capital, but if you were going to put a valuation on a company, how would you think about it?

A Uh, so unfortunately there's not as many comps as I would like in the space. I think marketplace and SAS has really taken off and I appreciate your support and, uh, and fostering the terminology to get there. Uh, and so I think, you know, you, uh, Uh, there's a variety, like you have your marketplace options, like you've got your Upworks, that they have their valuations, you have your SaaS companies, and then you have your services companies that are clearly much more towards the one-to-one revenue and nowhere near as high as the, uh, you know, five to 10 to 15 of the rest of them. So I think it's still yet to be defined of how much value is here, and I think it's up to the industry to prove out what we can do that's different than anybody else and how it's a more powerful platform before we get there, so. Right now it's basically comps and conversations, but I, I hope it gets a lot more towards the five plus than it does towards the one.

AI assessment note: “Right now it's basically comps and conversations”

Q when I was preparing for this interview, I could see a use case where, you know, you help people find writers to write more content. I could see a scenario where people are now doubling down on digital because they're, there, there is no in person really anymore right now. Are you seeing some of your larger accounts, you know, double and triple expansion revenue over the past 3060 days?

A So not yet. I think everyone's kind of in shock mode. We're still in this, uh, you know, right now we're on April third, just so everyone knows, because every week is so important at this juncture. Uh, everything could change in two weeks. I think right now everybody is mostly, um, trying to do a reset and, uh, at a pause. So most of our, most of the revenue that we did lose turned into paused revenue. So our paused revenue went up by 50% in three weeks. So they're not officially canceled. Um, but I think what's going to happen Uh, and I'll give insights into, I've been talking to as many industry leaders as possible. I think there is going to be a lot more towards the trend of content marketing and digital marketing are two of the few avenues that still remain relevant. And it's one of the few ways that you can market in a way that is It fits the right tone and the appropriate tone for the times that we're in, which is you don't have to be aggressive. You prepare your, your story for when people are looking for it, as opposed to when they're not ready for it.

AI assessment note: “So not yet. I think everyone's kind of in shock mode.”

Q that's only 3.5 million companies. Okay. There's thirty million small businesses in the U S right. So it's definitely going to run out. Um, and so what is your, let's, let's fast forward a week or two weeks. Let's assume that you do get 500,000 dollars. Is your intent to then spend that to cover payroll for the next eight weeks, or will you use that to make other investments?

A So we run pretty, we run super lean. So, which means our cash account, we don't try to bolster as well, and we try to invest as much as we can moving forward already. So I think my first account will be just the, the extra assuredness that we don't have to make any changes, and then we'll think about strategically, can we even add more Once the dust settles, but I think the, the point of the loan is to make companies feel more confident of keeping their exact payroll, not making any dramatic changes, and that's exactly what I hope it does for us. In phase one, in phase two, I think it becomes more interesting, which is, can we expand and bring on more people?

AI assessment note: “keeping their exact payroll, not making any dramatic changes, and that's exactly what I hope”

Q when I was preparing for this interview, I could see a use case where, you know, you help people find writers to write more content. I could see a scenario where people are now doubling down on digital because they're, there, there is no in person really anymore right now. Are you seeing some of your larger accounts, you know, double and triple expansion revenue over the past 3060 days?

A So not yet. I think everyone's kind of in shock mode. We're still in this, uh, you know, right now we're on April third, just so everyone knows, because every week is so important at this juncture. Uh, everything could change in two weeks. I think right now everybody is mostly, um, trying to do a reset and, uh, at a pause. So most of our, most of the revenue that we did lose turned into paused revenue. So our paused revenue went up by 50% in three weeks. So they're not officially canceled. Um, but I think what's going to happen Uh, and I'll give insights into, I've been talking to as many industry leaders as possible. I think there is going to be a lot more towards the trend of content marketing and digital marketing are two of the few avenues that still remain relevant. And it's one of the few ways that you can market in a way that is It fits the right tone and the appropriate tone for the times that we're in, which is you don't have to be aggressive. You prepare your, your story for when people are looking for it, as opposed to when they're not ready for it.

AI assessment note: “So not yet. I think everyone's kind of in shock mode.”

Q that's only 3.5 million companies. Okay. There's thirty million small businesses in the U S right. So it's definitely going to run out. Um, and so what is your, let's, let's fast forward a week or two weeks. Let's assume that you do get 500,000 dollars. Is your intent to then spend that to cover payroll for the next eight weeks, or will you use that to make other investments?

A So we run pretty, we run super lean. So, which means our cash account, we don't try to bolster as well, and we try to invest as much as we can moving forward already. So I think my first account will be just the, the extra assuredness that we don't have to make any changes, and then we'll think about strategically, can we even add more Once the dust settles, but I think the, the point of the loan is to make companies feel more confident of keeping their exact payroll, not making any dramatic changes, and that's exactly what I hope it does for us. In phase one, in phase two, I think it becomes more interesting, which is, can we expand and bring on more people?

AI assessment note: “keeping their exact payroll, not making any dramatic changes, and that's exactly what I hope”

Q So how, how do you guys think about, you don't need to think about this really because you're not, you're not raising capital, but if you were going to put a valuation on a company, how would you think about it?

A Uh, so unfortunately there's not as many comps as I would like in the space. I think marketplace and SAS has really taken off and I appreciate your support and, uh, and fostering the terminology to get there. Uh, and so I think, you know, you, uh, Uh, there's a variety, like you have your marketplace options, like you've got your Upworks, that they have their valuations, you have your SaaS companies, and then you have your services companies that are clearly much more towards the one-to-one revenue and nowhere near as high as the, uh, you know, five to 10 to 15 of the rest of them. So I think it's still yet to be defined of how much value is here, and I think it's up to the industry to prove out what we can do that's different than anybody else and how it's a more powerful platform before we get there, so. Right now it's basically comps and conversations, but I, I hope it gets a lot more towards the five plus than it does towards the one.

AI assessment note: “Right now it's basically comps and conversations”

Q Yeah, we'll see. We'll get it out. We'll get out quickly. We're going to follow your lead in case they want to apply as well. Um, listen, anything else that you want to touch on? Tough choices you had to, you've had to make for the past 30 days relative to, you know, responding to the virus?

A I think responding to the virus is something we thought about really deeply. We want to make sure that we nailed our tone and provided our clients and our audience something really valuable. So we've thought about this in a few ways, which is what can we reach out to everybody with? So one of the first things we offered was we, uh, we reached out in bulk to all of our clients and offered them a guide for how to change your content tone in the modern age is it's so important to get this right right now. You just have to lead with empathy and there's, it's all about them right now. It's not about you. Uh, and we also offer 10 free topics, which we charge a hundred dollars for, for our top SEO topic creation team to redo your topics or offer new topics. Uh, and we're kind of thinking about our next level of things that we can offer as well. Uh, and then we, uh, adjusted the pause, the amount of time that companies could take off too. So I think that was one of the things, the other thought thing we thought about is what other assets do we have to offer? And so I started a new video series on LinkedIn, um, that we're sharing out where I'm just interviewing marketing leaders, agencies, agency coaches on how to guide, what are, what do they expect to see from the crisis? And then what are their best recommendations? We're trying to make these really short, like five minute videos tha…

AI assessment note: “So one of the first things we offered was we, uh, we reached out in bulk”

Q Okay. Interesting. So one of the early issues they had was obviously chicken and egg problem. So how'd you get your first kind of people like me signing up to pay? And then how'd you get your first freelancers on board?

A Uh, so I joined the company and took over CEO a couple of years ago. So the company was founded by a couple founders in 2011. So I missed some of the early marketplace excitement, but I have, uh, so as part of one of the first, if not the first marketplace based company live ops that started in 2003. And so a lot, so a lot of these trends along the way. Uh, so I actually get this question a lot and the way I answer it is it's amazingly easy to find a great crowd of workers who want to work freelance from home Who are extremely qualified. So most of our challenge is focused on the business solution side. If you can get good at qualifying those freelancers upfront. Yep.

AI assessment note: “I joined the company... so I missed some of the early marketplace excitement”

Q By the way, great growth for a bootstrapped company, so obviously I love that. Um. Thank you. How did you know that the smart move was going to be to move, you know, instead of going out and getting more SMB customers, you know, taking a one-to-many approach and going agency was going to be better and more profitable and scale faster?

A That's a great question. So really you have a, as a bootstrap quest company, you have to be really strategic. I've never had to be so disciplined in my decision making and of what I could go after. Um, because I've had a larger funding before. Uh, so for me, I thought the content marketing space has really been evolving quite dynamically and quite quickly. It has moved from just lots of short blogs, got you great rankings on, on Google just five years ago. And that's where the company was started to now you have to have higher quality, You have to have more matching of some subject matter expertise, and you have to, uh, uh, include multiple forms of content as well. So I thought that our, the selling more of our existing product that I thought was needed to be upgraded was, uh, not as beneficial as selling more services to the existing clients, uh, until we could be upgraded. And so part of that was our big rebrand two months ago to, to Verblio, which kind of positioned us for the next year.

AI assessment note: “not as beneficial as selling more services to the existing clients”