Cody McLain: The 24-Year-Old with a $25M ARR Business

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Good morning! It's Friday, August 4th - Today we are examining SupportNinja and how its founder Cody McLain grew the company’s annual revenue by 600% over 5 years!

THE FEATURE

Cody McLain: The 24-Year-Old with a $25M ARR Business

Cody McLain never had it easy– before the age of 18, the young entrepreneur lost both of his parents to alcoholism, ended up in foster care, and eventually dropped out of high school.

Without any familial support, McLain took it upon himself to find his way in the world and started a web hosting business that generated approximately $1M annually before he was even 18.

Today, McLain’s latest venture SupportNinja generates over $25M in annual recurring revenue!

So, What’s the Business?

After founding a series of companies at a young age, some successful and some not, McLain had an in-depth understanding of what startups need to get off the ground. So, he capitalized on that understanding and founded SupportNinja– an outsourcing company that specializes in assisting tech startups.

SupportNinja's primary services are front-end customer support and back-office support for apps and platforms. Startups can offload day-to-day operations like reconciliation, data mining, and content moderation to SupportNinja, which allows them to focus on scaling their company.

McLain received the 2019 “Founders to Watch” award and his company ranked #86 on the 2019 Inc. 5,000 list. This is no surprise considering SupportNinja’s annual revenue has increased 600% over the course of five years.

• 2017- $3.9M

• 2018- $5.2M

• 2019- $8.9M

• 2020- $14.8M

• 2021- $24.5M

Currently, SupportNinja has over 1,000 employees that service clients like the Bill & Melinda Gates Foundation, RVShare, Checkr, and Hotel Tonight.

How They Win

Copy Your Competitors

When McLain got the idea for SupportNinja, he quickly realized that TaskUs was already providing a similar service. Rather than being disheartened, McLain saw this as validation for his outsourcing business model.

McLain openly discussed how SupportNinja quickly found success by examining competitors and copying the best elements from them. When creating the initial platform for SupportNinja, McLain pretended to be a client and called a competitor to learn exactly what they offered and what their sales practices were like.

One of the most crucial business decisions that SupportNinja copied from TaskUs was opening offices in the Philippines. The average hourly wage in the Philippines is $5.73 an hour. So, by paying their employees between $15-$25 an hour, SupportNinja job openings are highly sought after, and McClain can select from a pool of the most highly qualified Filipinos.

Employee Retention

The average attrition rate in the outsourcing industry is 28%, but SupportNinja has an attrition rate of just 3.4%. McLain is hyper-focused on the workplace atmosphere and comradery of his employee base, despite the majority of them being located thousands of miles overseas.

Even at the Philippines SupportNinja headquarters, the office space is made to look like that of a glossy, stereotypical Silicon Valley tech company with a variety of furniture, hangout spaces, and other features to encourage social interaction. SupportNinja employees are also made to feel a part of the team and can submit proposals on how to alter business practices.

To McLain, the primary benefit of retaining long-term employees is what he refers to as transient knowledge. When employees become engrained in a company, they acquire a deep understanding of its inner systems and become crucial assets. Plus, it helps to retain clients who appreciate working with the agents they’ve come to know.

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