Sharat Potharaju and Ravi Pratap Maddimsetty, co-founders of MobStac.

Famous Five:

Favorite Book? – Traction
What CEO do you follow? – Ed Catmull who wrote Creativity Inc for Ravi
Favorite online tool? — Rapportive
How many hours of sleep do you get?— 5
If you could let your 20-year old self, know one thing, what would it be? – “That entrepreneurship is a very, very painful journey”

Time Stamped Show Notes:

02:07 – Nathan introduces Sharat and Ravi to the show
02:23 – Sharat and Ravi were classmates since fifth grade and were roommates in college
02:53 – MobStac is trying to solve the problem of online to offline device connections
- 03:04 – They use the technology of WiFi, bluetooth and beacons in mobile devices
03:17 – Beaconstac is one of MobStac’s products
- 03:22 – It is a SaaS-based product that uses Bluetooth beacon technology
- 03:29 – It allows businesses to gather analytics
- 03:34 – It charges monthly
03:47 – Beaconstac is MobStac’s main revenue stream
04:08 – Businesses use bluetooth beacons that can be deployed to physical stores
- 04:18 – Beaconstac’s platform can then be used to track marketing and analytics
04:27 – Pricing starts at $49 to $99 monthly
- 04:34 – The price will vary depending on the number of beacons deployed in any physical location
- 04:45 – Average cost per beacon is $5 monthly which is on top of the starting price
05:25 – Beaconstac has a mixed group of customers, from mom and pop stores to enterprises
- 05:57 – Some would pay $50 a month and $5000 a month for others
06:04 – There are currently around 10K beacons deployed in total
06:27 – MobStac is a software company
- 07:03 – MobStac has partnered with a Chinese OEM who makes the hardware
07:35 – The pay for the hardware is a one-time cost
- 07:40 – “You own the beacons once you pay for the beacons”
- 07:43 – Charge per beacon is $22
- 07:50 – The margin is very small
08:07 – They make revenue mostly from the software and not from the hardware
08:15 – MobStac was launched in 2010
- 08:24 – It was focused in building products in the mobile space
09:20 – After pivoting, first year revenue was not zero but it was small
09:35 – 2014 revenue was less than $250K with 10-15 people on the team
- 09:54 – Current team size is 20
10:00 – The company is based in Bangalore, India but Sharat goes to New York as well
10:17 – Last month total MRR is close to $25K
- 10:22 – Target ARR by the end of 2017 is 500K
- 10:37 – Which was only from the Beaconstac product
10:56 – Beaconstac currently has 100 customers
11:12 – One of Beaconstac’s biggest customer is Google India
- 11:14 – Google has deployed over 2000 beacons at 117 train stations
- 11:28 – It is the largest public Wi-Fi project in the world
- 11:32 – The beacons are used to send notifications and awareness to people who are waiting at the stations
- 11:46 – Sample notification
12:20 – MobStac has raised $3.5M
13:07 – The strangest customer acquisition strategy they’ve done
14:10 – Google has made the beacon technology compliant with the chrome browser
- 14:23 – Someone who is near a beacon can receive a notification as long as he has a chrome browser and bluetooth on; no need to download an app
15:15 – One of their customers is a freelancer who bought a beacon so whenever he goes to an event, the beacon will send a notification to other attendees to market his services
15:56 – MobStac isn’t spending anything on paid marketing
- 16:01 – Ravi does some content marketing for the company
16:37 – Cap table
- 17:31 – Sharat and Ravi still own more than half of the company
19:00 – The Famous Five

3 Key Points:

Don’t be scared to pivot if it is for the betterment of your company.
The easiest and cheapest way to market your product is by using it.
Entrepreneurship is definitely not an easy route—prepare your mindset for a rough (but worth it) journey.

Resources Mentioned:

Simplero – The easiest way to launch your own membership course like the big influencers do but at 1/10th the cost.
The Top Inbox – The site Nathan uses to schedule emails to be sent later, set reminders in inbox, track opens, and follow-up with email sequences
GetLatka - Database of all B2B SaaS companies who have been on my show including their revenue, CAC, churn, ARPU and more
Klipfolio – Track your business performance across all departments for FREE
Hotjar – Nathan uses Hotjar to track what you’re doing on this site. He gets a video of each user visit like where they clicked and scrolled to make the site a better experience
Acuity Scheduling – Nathan uses Acuity to schedule his podcast interviews and appointments
Host Gator– The site Nathan uses to buy his domain names and hosting for the cheapest price possible
Audible– Nathan uses Audible when he’s driving from Austin to San Antonio (1.5-hour drive) to listen to audio books

Show Notes provided by Mallard Creatives

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789: Google Bought Their Beacons to Distribute Free Wifi in India