Mark Michael - CEO & Co-Founder @ DevHub

Welcome to another CEO Wisdom pod. We have Mark Michael for round 2. He's a CEO and co-founder at DevHub. Um, he built the website platform franchise brands everyone's been waiting for. So markmichael.com, you can find him at @gliderco on Insta and see his change of looks. Uh, I think last time we spoke you were in NYC, now you're in Seattle. Mark, welcome to the pod again. Tell us what you've been up to since ChatGPT-4.

What, give me the, what, what month or year was that?

It's like, I don't know, 2023.

Oh wow, it's been that long.

Um, or 2024, who knows.

Yeah, yeah, yeah, it's okay, same idea. Again, the beginning of whatever that was, um, and what it still is, I guess. Uh, I mean, again, I, what I tell people, I have two kind of narratives on everything, which is related to, I guess, that, which is one, I think people were just more and more trusting to a point with AI that it's kind of like the point of no return. At the same time, the call it models are getting better and better and better by the week. I keep saying I keep having these aha moments where I'm like, oh my God, oh wow. And I was walking with a really smart buddy yesterday. He's like, dude, I mean, he's got a whole other wild take on everything, but it's definitely— we're living it. It's real, and it's on one hand insanely amazing, at the same time scary, and at the same time, you know, like, I just keep reminding myself I have a great life regardless of what happens, right?

Why did you move, uh, to Seattle?

So I am at this As of this recording, I am 44 years old. I am married. We did not have kids. It's just what happened. And so, and then of course, you know, throwing a pandemic in there. And, you know, I'm in DevHub's offices in downtown Seattle right now. And I go between New York, Seattle, and Arizona as I please. New York is interesting because we started winning a lot. We bought a company out there in 2021. And then what I didn't anticipate about New York, I keep telling people, I thought, okay, we'll set up another office in New York. Again, just the state of, you know, our company, an office is not necessarily required. I still might do it this season, but ultimately the thing about New York that I did not anticipate, as I said, was how many people, customers, partners, friends, family, everyone comes through New York City. And I just, for some reason, I just never thought that. I thought, okay, I'll— I'm again thinking just totally only about setting up an office and like I'll figure out a friend group from that. And it's just the amount of connections that come from just being in New York. It's like even right now, like I'm going back in a week and I already have like the rest of August is sort of planned out, you know. And it's just like crazy.

Interesting. Uh, what's been up with, uh, with DevHub since last time we spoke? Were you even focused on franchises back then?

Yeah, still focused on franchise. And again, the reason why we say franchise is because it's the easiest way for people to understand what DevHub is solving for, um, which is a lot of websites, not one-off, right? Like, if you want to open up a website, go use Wix, Weebly, Squarespace, WordPress doesn't really matter, right? Lovable, that's fine. But when you want to go ahead and build 100 or 200 or 5,000, you need a CMS that can handle that mid-market enterprise level. Again, everything from security to hosting to uptime. It's not just, oh, I built it in cloud, I'm gonna publish it. It's like, cool, now maintain it, idiot. And so, uh, I mean, you need a CMS to do that. Uh, we are that CMS for multi-location brands. But again, in franchise, whether you're a restaurant or home services, people kind of know what that means. And so yes, we target franchise to explain what we do even better. And then of course, the ins and outs of corporate to local.

And you've been managing that company since 16 years?

I think almost, maybe 18 years. Yeah.

Yeah, that's a very long time. And you say like 2 million websites deployed. I mean, that's probably not the number of clients you have. Like, how much clients you have nowadays?

So we've launched— again, it's, it's funny, the, the number, you know, at one point we used to call it instances, right? How many instances of DevHub there were. But then that's not a reflection necessarily of revenue. So then we're like, okay, what's the revenue number? Then it's like, how many brands? So as of right now, we're over And then don't forget, our business pivoted about 2 years ago. So up until 2 years ago, we were white-labeled, um, so no one even heard of DevHub. And now it is direct to the brand. So brand-wise, we're somewhere over 50 or 100, but including white-label partners, we've deployed over 300 brands using DevHub.

That's a lot. Um, is it— are you gonna sell the business, or what's your— I think they're on cruising on—

yeah, there's like 3— there's 3 paths. Um, to answer the question of would we sell, we always say that, you know, if there's someone else's horse, we don't— we don't mind attaching our cart to it. Um, but ultimately, I think the big idea is I keep telling people, it's like, you see, like, if you put your fingers like this, there's like You can kind of see if I find a white spot somewhere, you can see like anyway, a pinhole of light. The big idea is can DevHub be the standard for what these large language models and AI agents are reading structurally of what is a website today? Again, unfortunately today the, the human believes that a website is still a new design, um, not necessarily the technology that powers that design. We think it's obviously the technology and being able to keep up with what's happening and actually build ahead of what's happening. Um, so can DevOps become that standard, which becomes a very large company and, you know, we don't even have time to do a podcast? Um, or is it, uh, or is it just like the best at doing, again, websites, very high-level execution for maybe 100 to 200 of the world's greatest brands? And then that's it. And we just kind of cap out and just build a really great luxury technology boutique brand. Or 3, yeah, do we just sell it because neither of the 2 things happened?

Right. And say, say the ARR right now is at $20 mil a year. What would it take to bring that to $100 mil? Slowly exhale.

I guess the short answer would be the people who've been in that motion before that understand what it's going to take to actually get there. It's not necessarily— I mean, it is in some ways more brands. Ultimately, I think it's in probably additional markets too. But it's a— okay, in the first scenario, that it's the pinhole of light, right? It's becoming a standard where again, everything is done via kind of like API. And again, you don't even have to talk to somebody. It's like, oh yeah, we just use DevHub to power all of our shit,, right? We do everything in Cloud Code and we publish via DevHub. And it's like, go to DevHub, buy the thing, boom, plug it into your cloud, and now you're publishing all the time. And again, like, can we then scale to thousands of brands, right? And then it goes from, again, sub-20 million to 100 plus, 200 plus, 300, like in the Cloudflare vein. Boom, blows up. Sick. There's a lot of work to do that, which is like the exhale of like Fuck, you know, we're trying to get there with what we have. Um, you know, every dollar goes back into this thing. It's not a lifestyle company. Uh, and then yeah, I mean, that's basically what it would take.

Have you been funded historically, or has the growth to what you are today has been organic?

Yeah, no, no, no, I mean both. So we got funded back in 2000 and call it '09, '10. But we were like 20, I don't know, 3 years old, and like getting funded was like, I hate to say easy, but it was pretty easy. And so I just thought, you know, cliché, like once we have money, we're rich. So we just started like building the next great thing, but ultimately the money ran out and there was no money coming in and was like, oh wait, what happens now? And so you know, for the last 16 years, 15 years, it's basically been bootstrapped. Um, the original hypothesis of what we were building and what we do today are just wildly different.

And what's been the best years of growth? Has it been COVID yet?

Uh, yes, upon further reflection, COVID was probably a secret boom to us because up until that point, I think a lot of brands just kind of were like, uh, yeah, website's cool, we build it once every 5 years. Um, because of COVID it was like, holy shit, like, we need to be able to update a lot more frequently of what, you know, the consumer might want to see, buy, schedule, understand. Um, that's not just like, you know, Google saying it's open, but really the brand is like, no, we're not open, and it hasn't synced. And so, uh, yeah, you know, again, COVID is a loaded word because a lot of things. But anyway, yeah, um, yeah, it was a boom. Brands understood the value of the website.

So it came organically, or did you deploy like new growth initiatives? Like, how do you get your clients nowadays?

Uh, so ask me again, let me hear it again.

The— your growth initiatives during COVID did these clients came in organically? Just—

yeah, yeah, yeah. So all the—

out of thin air, or did you have growth initiatives and GTM channels?

No, no, no, nothing. The— all the growth initiative stuff happened when we made the pivot to go direct to brand. Um, and so there's a bunch of fighter jets flying outside our windows right now because it's, uh, It's a nice show.

It's a nice free show.

It is. Yeah, every, every year in Seattle.

Or maybe you're under attack, who knows.

Yeah, every year it's, uh, Sea Fair in Seattle, and this is the weekend for it. Anyway, uh, so yeah, the growth came from the people we were— the partners that we white-labeled to, they were getting more and more brands who wanted websites.

Okay. Yeah, but how nowadays, right, I guess the growth has somewhat stabilized. How do you reach out, uh, franchisor Uh, what's the ICP here? Is it the CEO of the franchise? Is it the CMO of the franchise? How big do they need to be? What budget do they need to pull out? And yeah, what's the first touch, uh, that they have with DevHub?

Uh, so the ideal bread-and-butter franchise or multi-location brand is that is typically selling a product or service that's at least $50 to $100. I would say probably right around 20 locations or service areas is best. Budget-wise, anywhere between $440K and call it $100K or $120K should be okay.

A year?

Yeah, just call it that.

Unlimited websites or?

No, there's typically, so now how we price it is like, okay, so when we're talking to a brand, it's like, okay, you're at 100 locations, locations today or service areas. How big do you think you're going to be in 3 years? Cool, we're— we think we're going to be at, you know, 200. Great, here's the price for the next 3 years.

The franchise model, does it still scale nowadays? What are you seeing?

Uh, yeah.

Yes, yes. Why is that? And I see it as well, right? Like, I'm having a couple franchisors as clients. Um, why is it growing? Like Why does this still make sense?

Uh, I mean, this is only my personal opinion, not the opinion of my company or anything else that I know, uh, or anyone else that I represent. This is just Mark Michaels, a human on planet Earth, talking about—

I know, financial advice, read the fine print.

Yeah, exactly. Again, I think it's a great model for somebody I mean, every— again, look, I'm not gonna lie. So typically, most of the people I talk to are successful at franchising, right? Whether that's a franchisor or a franchise owner, right, or franchisee. And they all have the same sort of story. On the franchisee side, it was like, look, I worked in corporate America for 20 years or 15 years or 30 years. I just took my 401k. I just knew I wanted to do something else. And this insert blank healthcare franchise, pet, you know, boarding franchise, plumber, electrician, roofing. I mean, insert whatever, dog cleanup, poop business, whatever the hell it is. Like, they're like, it's the best decision I ever made. I wish I would have done this 30 years ago. The ones who are good at it. On the franchisor side, it was a means to an end, right? They think they had a great idea and they want to scale it. Banks were like, we're not going to loan you money to scale up, you know, a workout that, you know, matches your zone, um, AKA Orange Theory or spin class or whatever. And, you know, franchise gives them a way to blow it out before somebody else does. And I think it's a great model to scale, period, if you have that idea.

Yeah, yeah, the better question is like, why not, right? Like, it makes all kinds of sense because entrepreneurship is still on the rise.

I mean, again, I will say like franchise, again, one, I would say both. Like, I don't understand why not. Again, there's like, I guess there's two rules that a lot of people in franchise have taught me, right? Number one, in order to be successful, your franchisees have to make money, period. And number two, never compete against your franchisees.

Yes. Ever.

And so in some ways, I think if I was doing my own franchise, I would still pursue both. I think Raising Cane's, I think Chipotle, I think a couple of the— in the QSR space, quick serve restaurant space, um, I think they own a combination of, you know, corporate owned and franchisee owned. And I think that probably is the play, right? I mean, even Starbucks, I think like franchise to whatever it is, Magic Johnson to bring Starbucks to Atlanta or wherever, right? Like franchise is just a model to scale is how I think about it, period. And so in theory it'd be both. Like I would do both.

In most DTC space, right? But would it make sense for Walmart or Costco or, uh, super Doesn't make sense for most D2C spaces, and if not, why not?

I don't know. I mean, in a weird— I mean, look, ultimately it comes down to the franchisees that you sell, right? And if they're all— if you can get everyone to align to the vision of what you're doing, right? If Elon Musk was like, hey, do you want to own a Tesla dealership? Again, 5 years ago, you know, Mark, I'd be like, yeah, right away, sir. Right, you know, like, let's roll, you know. So again, like, if you can get the people who are, you know, in it for the same reasons you are, you know, in a DTC, Costco, big box, even some version of retail, I think— I, I don't know why it wouldn't work. But again, I'm just naive.

Like, I know why it wouldn't. If you're a control freak as a franchiser and you've got all your ducks in a row and you, you're, you're acing pretty much everything and hyper-capitalize also, you're better not doing a franchisee model, uh, because you outsource control, you outsource branding, um, because franchisees pay you also, right? Like, they pay to have a franchise, so they add to your cash flow.

I look at it like franchising is a business in a box, right? Like, you don't get to change the brand, you don't get to change how you want to change something that you don't agree with. Again, that's where shit gets— that's where things break down, is if franchisees start to try to change the things. Um, and again, I always say, like, when my friends ask me, like, Mark, would you buy— what franchise would you buy? Or, you know, I'm like, look, I always just look who's the leadership of the franchisor. Do you believe that they can do what they say they can do? That's it, right?

Yes.

I don't care about anything else. Like Do I believe in it? And then again, luckily there are a lot of laws in America where they have to file their franchise disclosure document, FDD. You can Google it, you know, and you can figure out, okay, they have to legally report, here's the best, here's the worst franchisee, you know, here's all the costs. Like, they have to be insanely transparent. So like, if someone really wants to, they can do their homework to understand, are these people legit? Is this franchise system legit? Let me talk to a couple franchisees. And you can figure out pretty quickly, you know, whether it's, um, you know what's the best exercise?

You visit a bunch of these franchises and you try them out as a customer, and ideally in multiple states, and see how consistent it is and see how well-managed it is. It looks like shit if their bathrooms are not clean, for example, and if the staff is like A1 always, or if I think that would be the best research exercise if they have the means, of course. Um, Ray Kroc style, sort of, right? Um, yeah, 100%. Yeah. Um, you didn't answer your question, how they— how do you get their attention? How do they enter your funnel? Basically, is it ads, SEO, is it referrals?

It's all channels. Again, all channels.

All that.

Yeah, all channels, all the time. I think organic, social. I, I have a post coming out tomorrow, or sorry, next Wednesday, you know, LinkedIn to me has been fucking epic. I love it.

Again, my LinkedIn ads or posts?

Both. LinkedIn posts, ads, and then, you know, cold emailing, texting. I mean, all of it. I mean, it's all of it. You don't automate shit. Anyone who automates anything in sales is an idiot to me, or they're just selling something that's so low value that that's why they automate it, because they're lazy, because it's not worth their time. Right? Like, if you're selling my post, I'll read— I mean, I'll just tell you, preview it for next week.

I'm looking at your post now. You're posting like diagrams of like the most popular franchises, which is fucking great, by the way. I love it.

Um, right. So then, so again, so like the, my post next week is the case for LinkedIn and mid-market companies.

Okay.

And again, it says the 3 disclaimers are if your company does over $100 million a year, AKA, and sells a product that's over $200K a year, LinkedIn might not be your play.

Why not?

Because I think like some of those more corporate companies are, are too big to find the right decision.

Well, they'll help them close. It won't help top of funnel, but it'll help them close. It'll help with their authority. Yeah, I mean, again, to be like a quote-unquote thought leader, even especially if you saw these levels. But yeah, go on.

Yeah, again, I just think that the bigger companies, it's probably— if you're targeting one, if you are already a bigger company, and two, if you are targeting a bigger company, I just find it— I have found it in my own experience doing the work, it's extremely hard to target to find the right person because they have a marketing team that's 1,000 fucking people and you're targeting the guy who calls himself marketing director and he's the marketing director of what? Like what? At Whirlpool, let's say, Corporation, marketing director of what?

Well, CMO that you need to target or head of marketing.

So the CMO's role in a Fortune 5000, 1000 company is a lot different than a CMO of a company who's only doing $20 million, $50 million, $100 million. And so it's a lot easier to target, again, companies that are Um, uh, not that big, and/or your company is not that big. I just think— number 2 is like I wrote, it's like if you're using this article to finally get motivated, then you're not gonna— you're still not gonna do shit. And then 3, if you're a founder, yeah.

And why do you post on— how to post on LinkedIn? Did you have something to sell about, like, on brand? Are you launching a new business or what? Uh, you're just trying to be helpful to your CMO audience, uh, that would potentially buy DevHub stuff.

So again, I think the name of the game of sales today is, one, everyone is selling, and two, everyone knows that they're being sold to. So how do you stay relevant so that when somebody in our market thinks, I want a website, they think of DevHub first? And I don't— you don't do that by, in my opinion, and that's the thing I'll post next Wednesday, you don't do that by saying, let me do a free audit, uh, let me do a free consultation, let me, uh, tell you why you suck and why you're not doing anything right. It's like, what information can you give that's like just not salesy at all? And again, I get guilty all the time, right? I just want to be like, DevOps the best, DevOps the best, you're an idiot. Use DevOps, and I still do that, but again, it doesn't get any engagement, right? But meanwhile, if I want to post these lists that we've been posting these last 3 weeks, 4 weeks, they've been getting a shit ton of engagement. And I'm like, I keep wondering, I'm like, that's so funny. After 2+3+4+ years that I know if I post a picture of me and my dad, me and my co-founder, me and my company people, whatever, and franchise, those will always get engagement. If I post anything about a product release or, you know, something we found that our customers are doing, nobody cares. But then this idea of the list and who's big and not big and what they might be doing right or wrong, those get engagement. And if you think about it, you're like, of course they would, right? Because someone's like, hey, look, we made this list, and they start forwarding it secretly. And that's where it's happening. Like, it's funny, the view count on some of those posts is a lot higher than the engagement shows. And what I found is that people are copying and pasting the link, not sharing it natively within LinkedIn, and then sharing it within their Slack channels. And those people are clicking like, hey, look, we made it into some list that DevOps says we're doing great in whatever. And then there, that's how it's getting its virality. It's not from the engagement itself off of the post, which I think is wildly fascinating study in human behavior.

Is your dad your advisor?

He is the chairman of our board of advisors. Wow. Again, I grew up as like basically a prince. I mean, my parents instilled an insane amount of confidence in me and my brothers. And I don't think there's anyone else on this planet besides my parents that I would want to have a front row seat to what we are building.

Interesting. I'm going to challenge also one idea you said, like sales automation. I know you probably didn't mean like full sales automation is stupid, but I think automation is crucial nowadays. It all depends on your offer. For example, my first piece of outreach, she was automated, right? But the offer to go on a podcast is a great offer, and it's personalized, and it's fun to hop on podcasts, right? So I believe into some form of automation, but not like full automation. Also, like, silly placeholders like, hey, you're a Dodgers fan, right? Like, uh, I think that's pretty dumb. Would you agree?

Yeah, no, I agree. I mean, basically what we're doing is we're running I would say 80% non-automated. After, again, there's a couple, couple rules we've adopted this year. One, you never take anyone out of a sequence. There is no breakup emails. There is no like, this is my last time reaching out to you. It's like, what the fuck are you doing? You're breaking up with yourself, you idiot. Like, who's breaking up? Who are you talking to? Like, I'm like, no, no more. We don't end the conversation ever. But sales will, sales will reach out. I think it's 29 touches with a potential prospect. They each get a book of, call it, 100 brands. They reach out manually, one-to-one, for 29 touches over the course of 3 months. And after those 3 months, they can then put prospects that they've reached out to into an automated sequence for another call it 2 months before that audience comes back into their book again.

Yeah, I love it. What's next for you? What's your priority this year?

Blow DevHub up. Go, go big. I mean, I've stepped back into owning the revenue role at this moment in time. Again, don't forget, I'm very lucky that I have a co-founder who is the product technology innovation, right? Like, I'm not one of the pro— I'm not a product CEO. Um, I get— I have a co-CEO, my business partner since I was 17 years old. He's the brains. He tells me, here's what we can do, here's where the product's going, here's what it's going to do, here's why we're the best, here's where customers are doing what they're doing. I'm giving him feedback from front lines of sales, what people are asking for, from price to features to whatnot. We have that relationship. So I focus most of my time on the sales and marketing side. And he, uh, as— and so I've hired for the last 2 years multiple sales marketing folks. I just think a lot of people did it wrong. So I stepped back in, in beginning of Q2, and I'm doing alongside of sales and marketing my own outreach everything that they're doing, I'm doing as well, to just understand, okay, here's what's up. And the first thing I got rid of was automation because I was like, this was just fucking lazy as shit. Like, actually lazy as shit. Like, the best email to send to a prospect on a Friday is, happy Friday, have a great weekend, MM, or whatever the fuck your initials are. Like, you think you're not gonna— like, that's it. Like, you don't need to go and be like Hey, let me tell you, we're working with 3 of your best friends and 3 of your competitors, or, you know, your website doesn't seem to be working, or it's loading slow before the weekend. Are you smoking crack? You think somebody wants to hear that shit? Like, I want to pretend like I never saw it. And so it's like, yo, have a great weekend. Yo, I like your name. Yo, like, you know, like, be cool. Again, stay relevant. Without getting blocked, spammed, reported, um, told to fuck off. Yeah, you only do that by either being like kind of funny, kind of human, um, and kind of valuable.

I love it. Where can people find out more about you, Mark?

So devhub.com for everything about DevHub, markmichael.com, which I just got the domain name after fucking 20 I mean, since 1999, so 26 years I've been after that domain name and I finally got it. Yeah, I saw that, um, which was awesome. So yeah, markmichael.com for anything me personally, but everything else and all I want is more brands on DevHub, so go to devhub.com.

This is Mark