Bootstrap First, Raise Money Later to $120M from Colorado: Madwire CEO JB Kellogg (Part 5)

Sramana Mitra: What happens in 2019?

JB Kellogg: We built the third version and released at the end of 2019. We’re excited about that because it truly makes us more of a technology company than we’ve ever been. Now we have do-it-yourself (DIY) functionality, and not just do-it-for-me (DIFM).

We made the shift from all services to DIFM to a tech company that just happens to have managed services if you need them but they are not required. It just has a lot of functionality that a small business would need like payments, scheduling, CRM, and social media management.

Sramana Mitra: Are you getting traction with the do-it-yourself product?

JB Kellogg: Very much.  

Sramana Mitra: How do you position that product with respect to the rest of the market? That market is a very crowded market from a SaaS point of view.

JB Kellogg: We position ourselves as the singular platform. There’s a lot of do-it-yourself platforms that do very specific things. MailChimp does emails. Hubspot does CRM. There isn’t a good singular platform for small businesses that has all of those things on one platform.

Sramana Mitra: Zoho does.

JB Kellogg: Not for a small business. You don’t have small businesses really using Zoho; it’s more of an enterprise.

Sramana Mitra: Zoho is a small business product. It’s based entirely on the small business market. They’re doing close to a billion at this point.

JB Kellogg: I would disagree with you. We have 20,000 customers that we talk to every day. Very few of them actually use Zoho or even want to use Zoho. It’s more complex. Maybe you’re not understanding our customers well. We work with a local plumber, a chiropractor, or a roofer. These customers don’t have the skill to set up a Zoho for themselves. It’s further up the food chain. 

Sramana Mitra: Zoho does very well with tech-savvy small businesses. Your world is the brick-and-mortar businesses.

JB Kellogg: We do have about 35% e-commerce customers as well.

Sramana Mitra: You might want to look at those digital customers and why are you getting them. We are Zoho’s customer. 

JB Kellogg: Zoho is amazing but it’s not just something that our customer base is looking at. We’re not losing any deals to Zoho. We just don’t go head to head very much.

Our platform is different in the sense that it’s a simpler version of what a small business needs that’s fully integrated. It’s a very simplified version. Zoho is an amazing solution for small businesses that want to take it to the next level. We don’t cross paths with them very much.

Sramana Mitra: You’re acquiring customers from a different pool than where Zoho is acquiring customers from. Where did you end 2019 at revenue-wise?

JB Kellogg: We had a run rate of $120 million.

Sramana Mitra: Fabulous. Do you plan to go public?

JB Kellogg: That was our plan – to keep improving our metrics and maybe in 18 months, be in a position to do something like that. With COVID, everything’s up in the air.

Sramana Mitra: You do have a lot of customers that are impacted.

JB Kellogg: Definitely.

Sramana Mitra: Wonderful story. Thank you for your time.

This segment is part 5 in the series : Bootstrap First, Raise Money Later to $120M from Colorado: Madwire CEO JB Kellogg
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