Andrei: Welcome to Bootstrapped startup show. Today we have a retargeting.biz co-founder and CEO, Rares Banescu. And we’ll talk to Rares about his entrepreneurial journey. As always we’ll ask the questions about how did he grow his startup, how did he acquire his first customers. But
Learnings he can share with us. Rares thanks a lot for joining us today. Can you please share a few words about yourself and about your product?
Rares: So I’ve been in the e-commerce industry since twelve or thirteen years and in this journey identified that there is a need. Because I was owning a shop before and I identified that there is a need for a product that lets say optimize the communication between my shop and my users, because you always forget to send the newsletter, you always forget to write the note to create a new campaign in Google or in facebook.
You always forget to increase budgets or the performing campaigns and we started developing retargeting six years ago. It was me and two developers started on my couch actually and since 2013-14 when we released the first version. We managed to get out close to 1,000 paying customers.
Team of 35 offices in four countries Romania, Bulgaria, Hungary and Greece and we’re in the process of releasing our first product that will be 100% managed by machine learning so the journey was not that easy.
As I explained it was a lot of steps, a lot of versions you know someone asked me at the bigger why are we releasing the sixth version it easy because the first piece didn’t put performance as expected as an entrepreneur you don’t measure ten times.
And you cut once you go like this you know up you find some new ideas you fix some new things and by doing so you increase, and you would start and you build a better product every time. Whatsoever no monthly or annual recurring revenue at the moment we’re currently at around 3.4 million euros revenue this year.
You have other revenue streams. The recorded revenue is around 2.5 million and rather close to 1 million in other revenue twins or other products that we’re building right now because one idea leads to another and then another idea leads to a new product.
Andrei: Fantastic that’s really man one and great achievement for being sexy ours on this market you know that’s fantastic achievement and I can’t please share what’s the difference because I read your website I know what actually do you mean by dynamic ads.
But can you please share what’s the difference between your product and standard 3 targets and you can do on Facebook and Google what’s what your product allows to do better with the target on our product allows you to scale creatives for example if you want to do retargeting.
Rares: Let’s say you have a banner you create a banner and that banner will be seen, but although by all of your audience if you want the dynamic retargeting then you do it by the key of my catalog you plug in the catalog.
If you want to scale creatives for example having a frame or having something animated on your own on that ad, you won’t be able to unless you prepare all the images and upload in your feed so what we’re doing, we are allowing you to scale creatives.
And on top of that we have a lot of scripts that increased performance for example we exclude bounce if someone clicks on your ad lands on the website. And bounce then we will automatically create an audience with bounce and we will not show ads to the bounce audience or we have automated AP testing that identifies where is the best place in order to deliver data.
In chat, in the console, on the right side and we push budgets based on this habit testing and having access to the Facebook API there are a lot of automation scripts because as you know we are one of the few companies in Eastern Europe that have the Facebook marketing partner badge. And we have via API who have access to a lot of scripts that allows us to optimize the ad and we are delivering with let’s say 20 to 30% lower CPA.
If you run ads with us, yes imagine that imagine that we’re digitizing and we’re optimizing a marketing a performance marketing agency or a digital marketing agency, you know
because the issue with digital marketing agencies is they can’t scale. They say if they’d scale they need more human resources so with us we have a team of 35 and 50.
Probably our developers so 20 our operational customer support and sales and with these 20 guys we’re managing 1,000 customers if we want to scale from 1,000 to 2,000 customers we will need 10 server 6 servers and another four employees.
So it’s easy to scale so we’re having this product you know that let’s say we are offering 80 or 90% of the services that an agency are offering its but the customers are happy there because they are paying less if you want if you’re an e-commerce you’ll have you need an agency for Google the freelancer for Facebook an app for newsletter an app for push notification.
The supplier Morris has a supplier for personalized content on the website all these bundles of service you can find in retargeting fully optimized and personalized at a fraction of the cost.
Andrei: Based on what you have shared you know I just have two questions I want to ask you so the first one is when you started that business did you have any fear you know put all eggs in one basket?
Rares: I mean you rely on Facebook and Google however it didn’t have Google and Facebook at the beginning.
At the beginning retargeting started as a reengagement platform with emails pop-ups, SMS’s, automated pop-ups and emails based on user reactions of the website like exit intent pop-up my cart abandonment or upsell pop-up stuff like that and we didn’t have Google and Facebook.
In our value proposition we with the first version of the product we managed to get around 200 paying customers and then at an event in Poland if I remember correctly Google approached us. Hey look guys, I see that you have a lot of Tacoma shops do you think it will be a good idea to also integrate Google.
And deliver Google as to your customers okay if we’re going to build Google, let’s add also Facebook we try to find a partner who will have both of them we didn’t found a partner that will allow that will give us API access and with the good cost has go of course and we started building the api’s for ourselves.
And then we write never implementing viber ads YouTube dynamic ads and the Google Display video 360 the enterprise tool you know like Windows or stuff like that things started to shift for us from the moment we announced Google and Facebook and since then we’re growing steadily.
Month-over-month and we’re growing and we’re growing and we’re adding other products and other features in other features in the product where we want to be but hopefully in the new version.
That will be released in August or September. It will be very close to what we tried to build three or four year ago because you know in development things are never easy. They are always amazed that developers are very hard to get and even if you get them they are very hard to maintain.
To keep them in game you know because the fellow friend you I’m bored with this technology I want something different and to keep up or if you’re not able to cope with her with her with their ex with their needs then they’re going to shift and it’s the the the in my perspective the the biggest challenge that we have so far is the human resource or we had I don’t know if you’re still going to have the same challenges in personnel.
Andrei: You know I’m also working on a start-up right now so in a couple of weeks and NVP you would be ready and I had a chat with cells for our founder Jeroen from Belgium and he asked me several times what’s your progress with a product you know and I’m like well it’s not ready but the worker says that it will be ready later later and just keep them to is one great quote ‘welcome to the SAAS world’.
Rares: When you will consider you will you have this product ready then you’ll have other challenges like ok I forgot about your morning ok the onboarding process doesn’t fulfill the needs of my
customers ok I forgot I need a nap in order to manage my customers I okay the billing system is not as I expected.
I need to rebuild it based on my needs and you will start building other products that will help you manage the current product and then you’ll need resources in order because you will be behind with the development for the base product.
And everything it’s it’s like it’s like a snowball you will need more and more and more and more but the first thing my advice is the first thing if you want to have a sense is something that I haven’t done .And I switched a few months ago like four or five months ago at the beginning of the year and we we will I think that will this will change the face of our company.
Listen to your customer be centric on the customer we were focused on we want more customers we want more revenue and more countries we want more and more and more
but we were not, the growth comes with a very high cost. When we had 200 customers all of them were happy now with the low satisfaction rate.
It’s not that great because I can’t handle all the customers. You know if an account is dealing he’s happy I know what to tell him I know just him God otherwise the satisfaction rate it’s started decreasing and now we are focusing on customer needs and we’re building products based on customer needs. The idea is that the product if the customer needs it if you need it in order to build a feature for a customer takes more than six months.
Don’t build it in six months they will need something else so you need to be let’s say one step ahead on their needs but still let but still match your your your development ideas with part of their needs and power part of their their their scaling efforts no big everything comes to the
customer he’s the one that is paying you so up getting to up to 100 customers it’s easy.
Because you can do it yourself without any employees without any customer support without scaling from 100 to 500 it’s ok you can do it with money scaling from 500 to 5,000 that is at the at our point that is the pain point that we have at the current at the at the scoring time this is the hard part you know like 20 or 30 employees you know all of them by middle name.
But when you have 100 employees it will be impossible to grow if you don’t have the procedures in place like keep people in customer key people in marketing people in technique key people in sales in order to have a to have to have a let’s say a pyramid of of decision but when you will do that the feeling of start-up will disappear in your company.
You will not yet startup anymore you will be numbers 0 1 it’s better it increased so
Stefan: Pardon me let me ask you a question so how did you get your first certain customer?
Rares: I am a sales guy at the base at you know at the I’m a commercial guy and I loved sales from the early beginning and I can tell you guys that I had 10 contracts signed charged invoices.
And charged before knowing with whom I’m going to develop the product so I’m in customer pick we’re going to build this were very close to releasing it but I didn’t have any idea with whom I’m going to build it the contract was to find the invoice was issues and issue them paid.
So first time customers if you hear any back noise are my means that are playing at my door door at the moment but that’s great we have you know funny kid stuff on the background so instead of you using music we’ll have a kids now so that’s okay that’s okay use it as an intro what did you do to scale so you acquire assistant customers from direct sales.
Andrei: And what did you do next so how did you grow to 100 customers integrating?
Rares: I realized that dealing with direct sales will not lead me in having a big number of customers and then I started integrating our product with e-commerce platforms close source and open source.
Open source locally in Bulgaria, Romania, Hungary increasing open close first and officers like Magento PrestaShop open carts and then we invested the most of our resources in these partnerships.
I can tell you so far that we are one I think the only Romanian company that has a
partnership with PrestaShop because our plug-in is free on PrestaShop you can download it you can you know every every plug-in in PrestaShop is paid ours is free because we have a very
close partnership with PrestaShop and we’re also in the process of having something similar with Shopify.
And Magento but this comes with a huge expense in terms of in terms of resources, not only financial but also human resources if that will that are needed in this in this in this project if I take a look at the entrepreneurial journey and at the growth when you please share what worked for you and what didn’t work I didn’t have the mind and the knowledge to learn from others mistakes.
I had to learn and this was very expensive imagine that when we weren’t ready I tried to open poll I tried it to open two countries Poland one of them and I spent around two hundred thousand euros trying to open Poland with the wrong partners and with the wrong product and in six months I came back to my home country with ten or fifteen paying customers.
And those were unsatisfied as well burning burning cash is not always a good idea if your product is not ready this was the one of the biggest mistakes that that I’ve done so first of all try to see traction on a species on a smaller market on a certain on a specific niche then try to identify the perfect the ideal customer.
Don’t go after all customers take the ideal customer for example for us the ideal customers has between 50,000 toward 1 up to 100,000 visitors per month Marketing is in-house doesn’t work with an agency spending around 6,000 to 10,000 euro in in ads small company max five employees so small and medium businesses were targeting assemblies with our partner.
And when we started going to four big fishes that was either expensive and ineffective and we wasted money trying to get a customer and that will not be satisfied with our product because they had different expectations under let’s say ads feature or stuff like that it will one first try to have a good product try to see some traction.
Before starting burning my bike burning cash and then if you burn cash do it on your target on a specific target of customers don’t go wide that’s fantastic and what worked really well for you in
in terms of clients acquisition the partnership with the owners platforms as I said the partnerships we started scaling with those partnerships.
We have let’s say, you have a system where we share with a revenue sharing system where we okay they advertise us. They get a piece of the revenue that we’re charging and this is working. This is working quite good where I’m boarding we’re aborting new customers.
New partners let’s say every three months every three to six months for onboarding a new e-commerce platform so it’s kind of affiliate programs affiliate was the word that I was looking for but I forgot it and what our core acquisition channels are at the moment so we’re advertising ourselves with the e-commerce platforms events.
A lot of events we also have a Google premier partner and we do a lot of joint your marketing actions with Google’s like everywhere we are all with pride pretty much every every program that they have and I must confirm that we’re getting customers from Google as well we are and are listed on Facebook page.
This bringing us this brought us a lot of traction big pressure because customers in a specific area they are looking for part Facebook partners in order to help them scale their business. And they find us a Romanian company with offices in almost every country in southeastern Europe and it’s easy for them to work with us so we do a lot of ads but the majority of the leads are coming from events.
From partnerships and from PR radish and now with the Cova times are you are they coming from web events or you’re you’re mean like physical events first of dehl physical effects but now web events a lot of web events I think I have around six calls per day 30 minutes to one hour daily part of my customers parts of them with my team parts of them with the webinars and online events and stuff like that fantastic.
So that’s what’s really interesting you know you’ve just provided some very good insights and I want to suggest you now in the end of our podcast I want to run a quick house my latest release Christian you know so let me quickly our Stefan would you like to ask these questions so we got these couple of questions and you just reply without thinking you know what it is.
An idea that will come to your mind I will ask okay Alice okay Irish what is your core skill as an entrepreneur that helps you create a successful business else sales okay what book had the biggest impact on you I forgot the name something with change or what the name I’m sorry I’m sure those who wrote it.
Andrei: Now I have the link to the link later yeah okay if you were starting right now and could do one thing differently what would it be?
Rares: To build the product better having a hiring a product manager that knows how to build products.
Stefan: Awesome! Okay. What is your number one learning from your entrepreneurship journey? Rares: What I’ve learned is that I should never quit. I should stop doing it and again and again.
And again because it’s mother nature if you try ten times at a certain point things will go will go well but don’t do don’t try ten times the same way so if the door doesn’t open don’t smash your head ten times it will not open not even eleventh time try different put your shoulder try with your hand do something okay what people do you follow and learn from the people that I follow are not public.
I have some guys that I learned a lot of them and the majority of them are from Google I’ve learned being part of this organization as a partner I learned amazing things that I married I’m and copying them in my own company and I can see improvements with everything that I do nice I just wanted to say that mentors can come from not convention.
I’ll not stand out places not for from where you expect to find them meet nice
Andrei: Ok. Last question one advice you can give to our listeners who plan to launch a bootstrap startup?
Rares: Don’t worry if you fail, failing it’s good news that you learn something in this process and next time you’ll do it better and don’t expect for things to you know to go on from the first time.
But failing it’s good I favored building four products before this or three three businesses so it’s not up is that you know what Thomas Edison said if he is not to let’s say how is he physically in bad because he tried to invent the light bulb 1000 times and he failed he said I didn’t fail building it one thousand inventing it one time.
Sometime I found one time one time one thousand ways of not building a light.
Stefan: Fantastic! Thank you so much for brilliant conversation, lots of insights I loved your journey and like a next couple of months would be, Stefan. The plan to launch also the virtual Summit the bootstrap style for the bootstrap is the bootstraps founders as speakers.
And I hope you’ll join us.
Rares: Why not I will give you a two title head of optimism and sales how about that my colleagues are describing yes why not you can you use it use it
Andrei: Thank you so much so we wish you a great day.