Bootstrapping from Arizona to $10 Million: Joshua Strebel, CEO of Pagely (Part 3)

Sramana Mitra: What was the point where you hit the $1 million annual revenue run rate mark?

Joshua Strebel: I think that was about 2011 to 2012. So, it took about two and a half to three years to get to a million a year.

Sramana Mitra: That’s very good. With a bootstrapped company, that’s very good. What were some of the strategic moves there after that made a big difference in your trajectory?

Joshua Strebel: I got to give you a little context here. When we launched in 2009, they said we were the first to market what is now this huge channel. It was new and novel. We were figuring things out and grew a little bit. Around 2010, our first competitors arrived. They had venture capital and seed funding. They really drove the market hard.

They did a lot of re-education of the market place. But they also really took some of the wind out of us because we’re this small operation, and they came in with deep pockets, marketing, and good press. Over the next couple of years, the market became more and more saturated. Additional players came in.

We had a bit of an existential crisis. It was like, “We can’t compete with their money.” GoDaddy enters the market. It was like, “We can’t compete with Super Bowl ads. How are we going to survive at this small company in this sea of funding?” So, we made this strategic decision to focus on the premium end of the market, which is that really high-end enterprise media and higher education space – high touch, low volume, high margin accounts.

We made that strategic change to stop playing in the commodity consumer market. We made that transition to the enterprise high-end market. That then started a three-year run where we were growing 100% year over year for three years and really took our business from basically an idea on life support to a full-fledged business, with 40 employees and just under $10 million in revenue.

Sramana Mitra: From a pricing change, what did you do?

Joshua Strebel: We had a year or two where we were offering $100 to $150 plans. By 2012 to 2013, we got rid of all that. Our low-end price was $400 which was two or three times the next competitor. We just positioned in a way that if you have complex needs or if you’re a big business and you have specific security requirements, you come to us and we take care of you. So we were pr,icing between $400 and $2,000. Today in 2019, we’re pricing between $5,000 and $50,000 a month.

Sramana: What kind of complexity are we talking? Name some of the complexities that you tackled.

Joshua Strebel: It really depends on the client. We’re very flexible and custom, so we build this in a lot of cases. We have one specific customer that has a very large media site which they use to disseminate digital assets. It’s a digital asset platform and has a login in front of it. They’re a household name, so it’s very important for them that their site is always up, working, and accessible.

They ran across 18 or 19 Amazon EC2 nodes with redundancy built-in and all this extra security. For them to run a WordPress site, this is what it takes to hit their strategic goals and info security goals. There’s this other very well-known brand. They might just have a simple marketing site and they can get by on just a standard in-the-box plan for us. But many of our customers are educated.

This segment is part 3 in the series : Bootstrapping from Arizona to $10 Million: Joshua Strebel, CEO of Pagely
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