In Episode #625, Nathan interviews Josh McCarter. He’s the co-founder and CEO of Booker Software, a leading business management and marketing solution serving over 10,000 health and beauty businesses. Josh has served in a variety of senior executive board roles at various technology companies including Arbitech, Spafinder and Autobytel. Famous Five: Favorite Book? – Make Big Happen What CEO do you follow? –  Steve Case, author of The Third Wave Favorite online tool? — OpenTable Do you get 8 hours of sleep?— No If you could let your 20-year old self, know one thing, what would it be? – “Startups are a blast, but they are not easy”   Time Stamped Show Notes: 01:23 – Nathan introduces Josh to the show 01:59 – Booker is a business management and marketing solution for health and wellness businesses 02:08 – Booker is like OpenTable 02:16 – Booker does everything for a business to run 02:31 – Booker gains revenue from their subscriptions averaging $150-250 monthly 02:48 – Booker also has merchant processing 02:53 – Booker also sells its add-on product, Frederick 03:50 – Josh started to focus on the spa industry because of the technology from his previous company 04:25 – “It’s important to understand what type of customers you serve best” 05:31 – Josh shares how he spun out of business in his previous company 06:00 – Make sure you have the right type of structure when you spin out a business 06:10 – Give preferences to the shareholders 06:18 – It took Josh 6-9 months to get all the right structures and licensing in place 06:30 – Josh had a series A for $150K in 2011 06:42 – Spafinder had put in the initial capital for Booker 07:17 – Booker’s current team size is around 200 07:26 – Booker has raised a total of a million 07:47 – You have to do a proper valuation for a spin out 08:30 – First year revenue 09:00 – Booker is currently at 10K locations 09:20 – There is a fee per location 09:34 – A company who has more locations pays more 10:05 – Average MRR 10:25 – Booker does a lot of upselling and retention 10:41 – Booker makes sure that they keep their existing customers happy 10:50 – “You’ve got to focus on upsell opportunities” 11:20 – Booker’s merchant processing 11:37 – Online booking for spas is more common 11:58 – First Data is Booker’s newest investor 12:54 – Average total transactions 13:15 – Josh is currently not in any acquisition talks and isn’t raising a round 13:23 –“We’ve got some good runway” 14:05 – Gross customer churn 14:30 – “50% of our churn is the people who ran out of business” 14:39 – Failure rate of the SMB market is quite high 15:00 – CAC 15:05 – Most SMBs in SaaS and marketing business spend $1500-3500 to acquire new customers 15:40 – Frederick came to Booker for partnership 16:10 – Frederick was able to look at how SMBs are retaining their customers 17:22 – Frederick was able to get high conversion and retention metrics 18:14 – Frederick is integrated heavily into Booker 18:38 – Team location 20:16 – The Famous Five   3 Key Points: It’s important to understand what type of customers you serve best. Make sure you have the right type of structure in place when you spin out a business. Startups are a blast, but they’re definitely not easy—be willing to put in the work.   Resources Mentioned: 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 Organifi – The juice was Nathan’s life saver during his trip in Southeast Asia Klipfolio – Track your business performance across all departments for FREE 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 Freshbooks – Nathan doesn’t waste time so he uses Freshbooks to send out invoices