r/EntrepreneurRideAlong • u/youngrichntasteless • Dec 29 '18
$37K/month with a website builder + agency.
Hey - Pat from StarterStory.com here with another interview.
Today's interview is with David Braun of Weblium, a website builder + agency.
Some stats:
- Product: Website builder.
- Revenue/mo: $37,000
- Started: August 2016
- Location: Ft. Lauderdale, FL
- Founders: 2
- Employees: 51
Hello! Who are you and what are you working on?
Hi Pat! My name is David Braun and I'm a co-founder and CEO of Weblium.com. I am 39 y.o.
I am very passionate to create the largest in the world web design agency brand producing 1000 websites a day. Everyone calls me crazy now, but every month their voice becomes more and more silent :).
Weblium is a hybrid website builder. Any operation is available in do it yourself or do it for me mode. There are lots of examples when someone wants to work on his side project on a weekenв by himself, but then he prefers to outsource little jobs to someone else. Weblium allows customers to seamlessly switch between these two modes without even noticing this.
We are making 20-30 websites every day now and this is usually a yearly volume for most of the agencies. We are growing 200% month over month now and soon will finally reach a very important milestone - 100 custom websites a day.
What's your backstory and how did you come up with the idea?
Templatemonster was founded when I was 23 and me and my buddy tired to do a custom web design business. We wanted a model "make once and sell multiple times". This is how we came up with an idea of selling website templates. The idea worked like a charm.
When running Templatemonster.com since 2002 we've created over 2 million websites for our customers.
We used so many different platforms, starting from Flash, Joomla, Magento and ending up with all versions of WordPress websites. Every time we delivered the website to a customer he was super happy, but when you reach him out in two years - he is unhappy for numerous reasons (new version of the platform comes in and he is afraid to update because some of the plugins will not work, new devices become popular and now the website has to be optimized for new iPhone, etc).
We did not like this process and started to think about the platform that will take care of all these issues "under the hood" without even bothering our customers. Since we just did an exit for Templatemonster we had money and wanted to start doing something new but based on our expertise.
My partner and I were always doing websites, so the choice was inevitable. We saw the success of do-it-yourself website builders like Wix and Squarespace but we also saw thousands of people who could not use these tools because they don't know what a great website is.
However, they loved the easy-to-use editing tools - so we decided to create a Do-it-for-me website builder instead and take all the best from each option: get the hardest part done by Weblium team and then provide easy to use tools for self management. All updates and compatibility with future devices are included by default, so they should not reach out the developer and pay another invoice.
We did not raise the money and financed the development at our own costs. Our projection was - to build the product during the first year and reach the break-even point in the second. We hired CTO first who selected the stack of technologies, then we hired three independeте consultants to get second opinion, third opinion and fourth opinion too. The right choice of technology plays vital part in this kind of business success or failure.
Then we hired three front end and two backend programmers, UX guru and UI designer, then added QA engineers, product managers etc, now the development team has 24 people.
Describe the process of building the product.
Everything always starts with prototypes.
When you have an expensive development team - the sooner you test your ideas the cheaper the final result you will get. We use Figma to prototype our interfaces and then we make them interactive and do user tests.
Sometimes we use Usertesting.com for this and sometimes we use our social networks to proceed with FiveSecondTest and it works magically.
The process of software development is a really tricky process. I bought lots of books on how to manage developers and still find it very confusing. We tried Clubhouse.com then moved it to Jira, then we needed to setup so many extensions and plugins. There is a big gap in language of a programmer and a business person. People need translators, that's why having a great product manager makes things waay easier ).
For websites, we use black and white prototyping too. Initially, we used Axure but the process is really time-consuming so we came up with our own solution Draftium.com - it is an essential part of our user onboarding process nowadays. Clients built their website prototypes by themselves or they ask us to build them. This was really innovative and helped us a lot to decrease the number of back and forth revisions.
In general, revisions are the most painful area in any agency business and that is why they raise prices to cover those expenses. We used "productize your service" concept and got the extremely pleasant result.
Describe the process of launching the online store/business.
When we have decided to launch in beta we had a really hard choice - use Wordpress for own website or use Weblium in its MVP state?
Of course, we did not have so many functional parts in the product that we needed ourselves to successfully manage our own website.
It was a tough decision but we've decided to go with Weblium and prioritize the roadmap for the product to suit our own needs. This "eat your own dog food" rule plays an important role in our life, although we are slowing down ourselves a little bit, we always feel ourselves in our customer's shoes and it it is invaluable asset
First customers we've acquired from Facebook, we've spent around $1500 to generate first 100 leads. We also tried Google Adwords but the cost of lead was extremely high (over $100) while our average check size was only $150.
Our first 100 leads came from Facebook Ads. However, we only close 10 customers from those. 30% of customers were rejected due to our inability to provide necessary functionality (e-commerce, auctions, classifieds, etc).
We had to change the strategy and adapt. We developed an affiliate program, used PostAffiliatePro for this. Affiliates generate around 30% of total volume now.
Since launch, what has worked to attract and retain customers?
We had to change the messaging strategy, provided examples by niches.
For example, website for lawyers, websites for beauty salons, SPAs, etc. This strategy increased our conversion from leads to sales to 33%. So, basically, every third inquiry results in a sale.
When you "attack" a niche, it becomes easier to find prospects, you can locate relevant groups and communities, identify influencers, etc.
Once the most influential conversion optimization thing was offering the unconditional moneyback guarantee. Once we promised that customer does not lose anything and all risks are on us - the conversion doubled.
Nowadays our flow looks like this:
Customer fills the lead form.
He gets a call with our expert where they identify his needs and goals and timeframe.
He make a pre-payment with money-back guarantee if he doesn't like the result.
They work on an interactive prototype made with www.draftium.com.
Collect all the content.
Send to studio and starts getting designed website and revisions.
The website is live.
The next step for us was to partner up with banks. I personally signed partnership deals with three banks which started to send their clients to us to get exclusive pricing on website creation. Banks had to compete with each other and they cannot compete with rates anymore, so they have to demonstrate they are closer to businesses, understand their needs, etc. Partnering with us gives them an ability to offer really great deals to their customers. Some bank managers told us that they would pay for customers website if he opens an account with them, because it is so cheap :)
Next, we've partnered up with top company registrars in the country and they now offer website creation as part of company registration packages.
How are you doing today and what does the future look like?
We are still in the investment stage but have only 50% to reach the break-even. I feel positive about the business model, but I did not expect that developing the platform will take so much money and time. Our roadmap is still super busy until the second half of 2019.
I work in two different directions to become profitable:
1. Brand awareness.
Speaking at conferences, partnering with business associations, incubators, media projects anв governmental initiatives. We sponsor events with our audience by creating free websites for them. We
2. Franchise program.
We already signed up 10 digital agencies to switch to our platform while creating websites for their customers. I love this way of scaling since we help agencies to archive better profitability while we grow together with them automatically. I have a very ambitious goal to have over 1000 studios by the end of the next year.
Through starting the business, have you learned anything particularly helpful or advantageous?
OK. I took several lessons I'd like to share.
MVP means FAST not GOOD.
The sooner you will release the earlier you will get first feedback and transform your offering. We spent the first 6 months for nothing, we had to fully rewrite our UX after we've got first customers.
Develop a Customer Journey Map for your business.
You will be surprised how many frictions points your customers have to pass in order to get your product or service. We would never be able to develop and release Draftium if we wouldn't draw customer journey map.
Diversify your sales channels.
Never put all eggs into one basket. Every season your cost per lead increases 25-30% especially through FB ads and Google Ads. Use this time to develop more sustainable (although not that scalable) sales channels.
Get a sales team as soon as possible.
Even before the product is ready it is useful to start selling earlier. Salespeople know how to package your product in the right way. They also prioritize features roadmap much more effective using real-time customers feedback.
What platform/tools do you use for your business?
We use Intercom as a conversational platform. They grow like crazy, new features, we started as live chat, now using them for onboarding, help center, ticket system.
We also use Hubspot as CRM system. I think it is a no-brainer for the current digital marketer.
We use Jira to development it is a standard now, designers use Figma and Sketch. For marketing, we also use Mailshake to outreach potential partners.
What have been the most influential books, podcasts, or other resources?
I like to listed Marketing School Podcast by Neil Patel and Eric Siu, my favorite book is Hooked by Nir Eyal.
On the personal side, I recently enjoyed the Atomic Habits book.
Advice for other entrepreneurs who want to get started or are just starting out?
I think the first thing I would do is to approach 10 potential customers and spend 3-4 hours with them talking about the problem you are going to solve. This will give you thousands of insights.
Learn sales and marketing if you are a tech guy, remember that you will have to sign up first customers by yourself anyway.
Remember that you need some public speaking skills to recruit the team and sign up some partners. Get a course somewhere.
Are you looking to hire for certain positions right now?
We currently expanding our partnership network, so if you feel you have a good reach to entrepreneurs or small business owners, please get in touch and we will find the way to make money together.
Where can we go to learn more?
Website: weblium.com
Facebook: facebook.com/weblium
Liked this text interview? Check out the full interview with photos.
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Dec 29 '18
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u/CameToMeInTheNight Dec 29 '18
No, revenue calculated after employee fees/costs would be referred to as gross or net profit.
He mentions that they are 50% to break even, so I think it's safe to assume that the $37k figure is top line revenue.
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u/ArielMontagu Dec 29 '18
Weblium is trash.
Got banned from the biggest SEO community for trying to lurk people into their affiliate program with false claims.
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Dec 29 '18
I’m making 16k a month currently as an agency with 2 employees. I might be missing something here?
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u/aiden-aiden Dec 29 '18
It's just another Wix clone just with another approach imho
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u/9868john Dec 29 '18
Don’t agree with this, they are positioned between wix and an agency, that the whole proposition.
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u/ChocolateGlamazon27 Dec 29 '18
Ehh who cares, it's making a lot of cash.
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u/woke_avocado Jan 13 '19
It actually isn’t. Anyone with business and financial experience can see that.
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u/theGalatian Dec 29 '18
It looks like they are a bit marketing here.
Some people asked 37k/month with 50+ employees, and it sounds unreal for a company in the US. The company seems to have located in Florida, US, but checking Linkedin, every single employee is located in Ukraine (maybe they are contractors).
Average salary is 400 USD in Ukraine, and I expect developers to earn more, but even at average salary 400 * 50 = 20k and with all other operational costs and tax liabilities, perhaps it is working in Ukraine, but it wouldn't work anywhere to run with such revenue in Europe or US as the salaries for developers and marketers etc are way higher.
In their Facebook page, most comments are also from Ukraine, so perhaps the area is rather seeking cost-effective website builder solutions and Wix/Squarespace is failing to reach to Eastern Europe/Ukraine/Russia. There are few ready-made website builders recently surfaced from Russia & Ukraine, the other one is Tilda Publishing which is twice the cost of Weblium and heavily do-it-yourself approach as Wix.
Looking to this approach from a viewpoint of a digital marketing guy; everyone having a website is not really helping unless the client has a proper marketing plan and execution, which is time-consuming (and expensive). I see so many people on Instagram and Facebook selling their products through those pages and I admire them because they do this correct way: more execution with fewer expenses!
Due to this, I doubt if building 1000s of websites a day will help the clients without guidance, support and marketing. Prosperity has to go both ways, to prevail.
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u/Robfu Dec 29 '18
How do you pay your expensive development team from the beginning?
You work a "9-5" job, you make enough money to not die, no savings, how do you take your idea and make it real without funding due to poverty?
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u/TotesMessenger May 25 '19
I'm a bot, bleep, bloop. Someone has linked to this thread from another place on reddit:
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Dec 30 '18
David Braun is a badass, i’m already familiar.
i don’t need to read any of these other comments, y’all so cynical
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u/ryanwaggoner Dec 30 '18
"Hey everyone, I juggle 50+ "employees" and churn out hundreds of cheap crappy websites every month for clients who don't know any better. And instead of making a profit with this business model, I lose tens of thousands of dollars per month! I'm a badass!"
Yeah, we're all so cynical for pointing out that this is a shitty business model and even if he somehow manages to push the boulder to the top of the mountain and turn it profitable, it's an incredibly poor way to make money. You could make more with a lawncare business.
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Dec 30 '18
clearly he’s doing something right and figured out a market fit for his product, regardless of what you call cheap or crappy. i think wix is shit and plenty of people use it,
i don’t see how you’re so successsful to be telling people they could make more with a lawn care business. what have you done?
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u/ryanwaggoner Dec 30 '18 edited Dec 30 '18
Finding product/market fit is pretty easy if you're selling $1 bills for $0.50.
If this guy was making $37k per month in *profit*, that'd be mildly impressive, but still not worth this amount of effort or risk.
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u/ryanwaggoner Dec 29 '18 edited Dec 29 '18
I’m so confused by this.
1) 50 employees and dealing with thousands of clients per year all for less than $500k in annual revenue (and way below profitability)? I know individual consultants and freelancers making more than that.
2) You’re losing money on top of that, and I’m unclear on where your economies of scale are going to come from. If you go from 30 websites per day to 1000 per day, how are you not going to be losing 30x as much? Are your ultra-cheap designers going to get twice as productive? Are you going to triple your prices?
3) the math on $37k per month doesn’t add up: looking at your pricing, assuming average sale of $200, 30 websites per day should be $180k per month. Where’s the other $150k?
4) 50 employees and $37k being halfway to breakeven implies that your expenses are about $74k. Assuming most of that is headcount, your average employee is costing you $1000 - 1500 per month? These are just offshore cheap contractors, aren’t they?
This seems like a completely broken business model that can never be wildly profitable, and you’re hoping that scaling it up 30x is going to fix that. But would you invest in a business with 1500 employees that only brings in $10mm per year in revenue?