Magfi 2023 Year End Summary. 15x MRR Increase, Corporate Customers, and Pivot to B2B SaaS

I am proud to write my Annual Magfi Development Report for this year (2023) as well.

Before that, as usual, I would like to briefly mention what Magfi is and about myself.

I am Mustafa Fikret Uğur, the co-founder and CEO of Magfi. Previously; At the age of fifteen, I founded the world's youngest Mars robot team and showcased our robots in the inter-university European Rover Challenge. At sixteen, I won an international scholarship to the U.S. Space and Rocket Center (USSRC) Space Camp. Subsequently, we worked on integrated air-to-air missile systems. We also worked on IoT-based smart irrigation and fertilization systems. At seventeen, I led the establishment of a venture named LoogicWorks and began producing civilian drones. Soon after, in Ankara, we collaborated with a defense industry holding company to work on Military Intelligence Drones. At eighteen, I worked on eSim and artificial intelligence solutions in the telecommunications sector. I gave seminars at over a hundred universities and high schools in Turkey. I have been a scholar and fellow at the T3 Foundation and the Entrepreneurship Foundation.

Magfi is a community-based technology startup that houses two different products: Magfi Ads and Magfi Monitoring. Our main driving force is Magfi Ads.

Magfi Ads is the first and only platform that allows you to reach communities on platforms such as Telegram, Discord and WhatsApp (Beta) and advertise simultaneously.

For example, below you can see how a sample advertisement appears in a Telegram community. These ads automatically match with communities according to the advertiser's targeting through AREA (Intelligent Ad Matching Algorithm). Once the desired reach is achieved, the ad is removed from the community, and payment is made to the community's owner/manager based on the received statistics. Thus, the content creator who owns the community earns revenue from these ads and strives to grow and maintain the quality of the community. The advertiser, in turn, reaches their target audience in a niche way with their products and brand. In short, Magfi Ads is an amazing marketing product. 😎

CONTENTS

1. Pre-Seed Investment
2. New B2B SaaS Platform: Magfi Business 2.1. Magfi Pixel
3. New Mobile App: Magfi Ads
4. Technologies We Use
5. Key Metrics 5.1. Magfiluencer and Impression 5.2. Advertisers 5.3. Revenue
6. Amazing Team
7. Magfi House
8. Seed Investment
9. Goals for 2024

Pre-Seed Investment

As I mentioned in the 2022 summary, we were in an investment round in the final months of 2022 and were in discussions with hundreds of investment funds and angel investors. Subsequently, we received our pre-seed investment from Lima Ventures in February 2023, which we deemed most suitable for this round. This was smart money for us. With this investment, Magfi received its first financial support. Thus, we rolled up our sleeves to more rapidly pursue our goals for 2023. For more information about the investment, you can check out the following resources.

egirişim, Swipline, StartupTeknoloji

New B2B SaaS Platform: Magfi Business

In 2022, our advertising system was entirely manual. If a customer wanted to advertise on Telegram, they first had to contact us and send all their content. Then we manually entered the advertisement into our database and ensured its distribution. This was a very primitive method and hindered our scalability.

The only and smartest solution to this was to devise a self-service advertising panel, similar to what Google Ads, Meta Ads, and TikTok Ads offer. We immediately set to work. We planned all the details of the panel. With the expertise of Çağatay Köroğlu, who masterfully executed all the designs, we produced our designs.

Now it was time to expand our team. We added a web front-end developer to our software team, increasing our full-time staff count to seven. Additionally, we hired two interns for data processing, thus beginning our journey with a nine-member team.

After four months of hard work, we launched business.magfiads.com. Advertisers can now place ads in thousands of communities within minutes, without any direct communication with us, and have the freedom to edit and optimize their ads as they wish.

Advertisers have the option to let our algorithm choose their campaign's target audience or set the targeting themselves. An advertiser can select their desired target audience based on the following criteria:

• Demographics: The language spoken by the target audience.
• Geographics: The location of the target audience.
• Technology: The operating system of the devices used by the target audience.
• Interests: The interests of the target audience.

Magfi Pixel

One of the key metrics in digital marketing is conversion. The importance of this metric varies depending on the objective of the ad, but in a lead generation campaign, conversion is the single most important factor, more so than impressions or clicks. Therefore, we needed to develop a system to track conversions. Until now, conversion tracking was not possible in Magfi Ads. In the panel, you could see the following metrics:

• Reach and Cost Per Mille (CPM)
• Clicks and Cost Per Click (CPC)
• Click-Through Rate (CTR)
• Geographical distribution of traffic
• Distribution of traffic according to interests
• Click intensity of Call to Action buttons
• Results of A/B testing between creatives
• Hourly and daily reach and traffic graphs
• Operating system distribution of traffic
• Types of communities
• In which communities the ad was published

Despite having all these data, the one metric we couldn't provide was "Conversion". But now, we have a solution: Magfi Pixel.

Magfi Pixel automatically tracks visits to your website and allows you to add events to monitor specific actions, such as viewing content, adding products to the cart, or making a purchase. In its simplest form, it follows these steps:

1. A UTM-tagged link is clicked.
2. The targeted website that is to be tracked opens.
3. Cookies are set.
4. The user triggers the desired event.
5. The triggered event is sent to the server with the cookie and displayed on the advertiser's panel.

New Mobile App: Magfi Ads

Before pivoting, Magfi served as a community-finding application, offering an additional functionality. To generate revenue, it was necessary to register your community in the Magfi Ads section within the app. However, now only our Magfi Ads mobile application is live, and we exclusively serve community owners (Magfiluencers).

The Magfi Ads mobile application is a business tool that allows you to control all the ads coming to your community, view earnings, and manage your community. For instance, if your community matches with an ad, we notify you hours or even days in advance and ask whether you accept the ad or not.

Thus, we significantly reduce the community churn rate because no ad that would displease a Magfiluencer is shared, and all kinds of information, from how much revenue will be generated from the campaign to other relevant details, are provided in advance.

Technologies We Use

When we first established Magfi, there was a pandemic, and we progressed the entire process over Discord. Later, when we met face to face, we started using project management tools like Trello and ClickUp, while continuing our communication on Discord. We also gathered documentation on Google Drive and advanced our processes.

In 2023, we use:

• Google Drive: For collecting and organizing documentation.
• Jira: As our Project Management Tool.
• Confluence: For writing technical documentation.
• Appsmith: As our internal company admin panel.
• Discord: For internal communication among our hybrid and remote working team members.
• Slack: For internal team communication.
• Figma: For designing mobile and web layouts.
• Notion: For managing some simple task controls.
• GitHub: For collaborative work and version control of our technology team.
• Excel: For some sales and customer tracking.
• Telegram: For communication with Magfiluencer customers.

The programming languages and technologies we use include:

NextJs, TypeScript, Redux, Flutter, Dart, MobX, Firebase, Javascript, NestJs, PostgreSQL, MongoDB, ElasticSearch, Typeform, AWS Lambda, EC2 (Ubuntu), Redis, RabbitMQ, Grafana, Twilio, SendGrid

Our Key Metrics

Magfiluencer and Reach:

• We can generate 2 million impressions in 24 hours.
• We make weekly revenue payments to over 1,200 Magfiluencers.
• There are Magfiluencers earning $1500 monthly.
• The communities we own in Turkey have over 13,000,000 users.
• We also have a reach in Azerbaijan.
• We have started gaining our first reach in Moldova.

Advertisers:

• The number of our advertisers increased from 8 to 60. This includes global brands among our advertisers.
• We provide services to many companies that have gone public, including a Fortune 500 company.

• Advertiser retention rate has increased. The churn rate has decreased.
• Due to the restrictions on Turkish banks from advertising on Google, Meta, and other X products, Magfi Ads has become an incredibly advantageous platform for them. Now, our portfolio includes some of Turkey's largest private banks. We have become an "Always On" platform for many banks.

Revenue:

• In November 2023, we earned 15 times the amount we received in the month of our investment. This is continuing with an upward trend every month.

• Daily Budget Feature: Advertisers no longer just set a total budget for a campaign and wait for the ads to end. They enter a daily budget, allowing for the optimization of the campaign while it's running, resulting in ads that last longer and are more effective.
• Suggested Budget Feature: Advertisers now select the best budget suggested by the algorithm for their campaign, leading to more efficient campaigns.
• Suggested CPM Feature: More exclusive communities seek higher revenue. Advertisers can reach these communities by offering higher CPM bids, thus expanding our community portfolio.

• In our 10th month, we started to become a cash positive enterprise and proved that we are a sustainable startup, even after the investment runway ended.

Amazing Team

There is one clear and firm belief we hold: a good idea can fail with a bad team, but even a mediocre idea can reach incredible heights with a good team. At Magfi, the most crucial part of our company culture is building and maintaining the best team. Therefore, we take immense pride in these exceptional individuals we currently have, and we always want to emphasize that their efforts are the driving force behind these technologies and achievements.

Now, I would like to introduce you to the Magfi team;

• This year, Metin Serhat Atayeter joined our team, bringing his 8 years of varied experience at Google, including his last 4 years as a Mobile Product Lead. After achieving incredible successes and experiences in product development and marketing, he now serves as our Chief Product Officer and Partner.
• Our CTO, Atakan, and our Frontend Lead, Kadir, have been coding since their childhood. Whenever they recognize a technological gap, instead of seeking external assistance, they dedicate themselves to learning that technology.
• Yaşar, despite his non-software academic background and age, has been working with the Magfi team for a long time and continues to do exceptional work.
• Our project manager, Deniz, is like a Swiss Army knife. In addition to being a project manager, he also takes on customer relations and account manager roles and works tirelessly.
• Yiğitcan is a highly disciplined programmer.
• Okan Özbay brings 20 years of agency experience to the table.

Magfi House

For a long time, we all had been working from our homes, and we decided to rent a small office. Subsequently, we all started coming to the office with flexible working hours. There is no such thing as fixed working hours for us, but even though we announced that the new team members could leave after 18:00, I haven't seen anyone actually leave at that time. Most of us usually didn't leave the office until it was midnight.

This office was in a ready-office concept. We were using one of Regus's offices in Turkey. After our 8-month journey and with the growth of our revenues and team, a very clever idea struck us. We were already living together as a team, paying rent for a house, and also paying rent for the office where we worked together. Wasn't it time to merge this house and office into one Magfi House? That's when we hit upon this fantastic idea. This would enable us to work more, stay more motivated and disciplined in our process. We found a house in Sarıyer, Istanbul. This detached house was both budget-friendly and exactly the concept we wanted. We got to work and transformed the lower floor entirely into an office. Now**, we live on the upper floor and work downstairs.** Here is the Magfi House.

Seed Investment

After receiving our pre-seed investment, we experienced significant growth and tremendously increased our market share in Turkey. The investment was spent exactly according to our calculations and ended right on time. We surpassed our targets. Now, we want to expand our market share in Eastern Europe, Latin America, and the region, and introduce new products. For this purpose, we are embarking on a new investment round. In this round, we especially want to engage with foreign investment funds to support our plan to go global. When discussing with investment funds, we pay attention to the following:

1. The expertise areas of the fund. (This is important for us as the fund's area of expertise is crucial for our development.)
2. The portfolio of the fund. (We are very interested in collaborating and exchanging information with other startups in the fund's portfolio, so the other startups they invest in are very valuable to us.)
3. The ability to make follow-on investments. (Magfi is a rapidly growing startup eager to become one of the major global technology companies. Therefore, we would greatly appreciate our previous investors participating in the next funding round.)

Our discussions with highly experienced and suitable investors and investment funds are ongoing. We believe that we will soon complete our seed stage investment round and announce it to everyone.

Goals for 2024

As Magfi, our primary goal is to develop products that provide the best service to our customers. Therefore, our top objective is not revenue, but to create the most stable and optimized product. For 2024, our first goal is to establish a data and artificial intelligence team. With this team, we aim to use our significant data resources to match ads more accurately with relevant communities, thereby increasing ad efficiency.

Secondly, we plan to start publishing Magfi's products within Telegram. This move will naturally inform all Telegram users worldwide about Magfi, accelerating our growth.

We aim to expand the ecosystem and create a new profession. Magfiluencers have already begun listing their status as Magfiluencers on their social media profiles. If thousands, tens of thousands, or even millions of people start doing this, we will have created a new economy. This is one of Magfi's core missions: to enable content creators to generate income and establish a new economy.

We want to enter new markets. Currently, we play an active role in Turkey and Azerbaijan. We have started our initial work in Moldova. In 2024, we aim to actively engage in Russia, Brazil, and the CIS region.

We aim to launch new products. By introducing Magfi Marketplace and Magfi Pro, we plan to expand our product range.

Finally

Here is the Magfi 2023 Summary. I am very excited to write the summary for 2024. I hope and believe that it will be a year where we see tremendous growth in the global market, with tens of thousands of content creators earning revenue through Magfi Ads and thousands of brands increasing their sales through Magfi Ads. We believe in this.

We work 8 days a week, 25 hours a day.

Until the end of 2024, take care…