ZenBusiness has rapidly become a leading provider of small business formation and management services. Founded by Ross Buhrdorf in 2016, the company has demonstrated remarkable growth, achieving an impressive $85 million in annual recurring revenue (ARR) as of 2024.
- $0 in revenue in 2016
- $1.2 million in 2018
- $4.2 million in 2019
- $15 million in 2020
- $41 million in 2021
- $85+ million in 2024
This rapid growth underscores ZenBusiness’s successful strategy in the competitive SaaS landscape.
From HomeAway CTO to Founding ZenBusiness
Ross Buhrdorf, the founder of ZenBusiness, brings a lot experience to the table from his previous role as CTO at HomeAway. He played a pivotal role in selling HomeAway to Expedia for $3.9 billion, a transaction often lauded as one of Expedia’s best acquisitions.
Leveraging the funds and experience from this significant deal, Buhrdorf set out to create ZenBusiness, aiming to provide comprehensive support for small businesses.
ZenBusiness Started in 2016 with $0 in Revenue
In 2016, ZenBusiness began its journey with no revenue. The company started from scratch, driven by a mission to simplify the process of starting and running a small business. From these beginnings, the company has grown exponentially, proving its value proposition to its customer base and the broader market.
“It’s scary going out there and doing it on your own” -Ross Buhrdorf
This quote by Ross captures the essence of the company’s mission.
ZenBusiness provides everything needed to launch, run, and grow a small business. This includes formation services for S-Corps and LLCs, compliance management, taxes, accounting, website creation, banking, and marketing. This all-encompassing SaaS platform ensures that small businesses have a single, reliable resource for all their needs.
At the beginning, in 2018, ZenBusiness operated very much on a product-led growth (PLG) motion.
“I would lay in bed and pray for customers to come to the website” -Ross Buhrdorf
ZenBusiness started off by offering some services for free, which attracted their first customers. The company’s initial focus on a freemium model was crucial in gaining early traction.
In 2018, ZenBusiness combined both services and SaaS. In 2020, they transitioned from offering a mix of services to selling packages that included services billed annually. This strategic move was made because they were leaving a lot of money on the table with their previous model.
Early on, they were trying to find their footing, and free services initially helped attract customers. Eventually, they realized their customers were willing to pay higher prices for the value ZenBusiness offered.
Revenue Doubled from $41 Million to Over $85 Million Since 2021
The revenue trajectory of ZenBusiness is a testament to its effective business model and market strategy. The company saw its revenue double from approximately $40 million in 2021 to over $85 million in 2024.
This impressive growth can be attributed to several strategic initiatives, including transitioning from a mix of services and SaaS to comprehensive packages that bundle services billed annually. This shift allowed ZenBusiness to capitalize on market demand and optimize its revenue streams.
In its early days, ZenBusiness operated on a product-led growth (PLG) model. The company initially offered free services to attract customers before transitioning to paid models.
By 2020, ZenBusiness had moved from free and paid services to annual packages, significantly boosting its revenue. Despite market shifts, the company has maintained a starter pack that is free, acknowledging the initial needs of small businesses.
Customer-Centric Approach
ZenBusiness’s customer-centric approach is at the heart of its success.
“Once you sell them, that’s when it starts” -Ross Buhrdorf
This quote refers to Ross’ commitment to making sure customers are taken care of not only at payment but forever.
ZenBusiness’s focus on simplicity and customer satisfaction has been key to its growth. Customers want a straightforward solution, and the company has continually refined its offerings to meet this demand.
From 2020 to 2021, ZenBusiness increased its prices by about $50 per package annually without adverse effects on customer acquisition or retention. This price adjustment, combined with effective traffic systems driven by programmatic SEO and strategic partnerships, has helped ZenBusiness double its revenue.
The company’s commitment to customer focus extends to its marketing and sales strategies. ZenBusiness relies heavily on organic search, affiliates, and a strong brand image to attract and retain customers.
“We don’t just convert; we ensure they renew,” emphasizes Ross. This ongoing engagement ensures customers derive continuous value from their subscriptions, fostering loyalty and reducing churn.
Innovations Drive Growth
ZenBusiness’s strategy of continuously listening to and understanding customer needs has driven its innovation and product development. By dividing their product strategy into Launch, Run, and Grow phases, ZenBusiness ensures that they cater to every stage of a small business’s lifecycle.
This comprehensive approach, combined with their use of AI and a focus on compliance and accuracy, sets ZenBusiness apart in the market.
Ross explains, “When they help their customers, they feel like their customers.
The company has always been proactive in its customer recruitment. Initially, ZenBusiness used an SEO strategy that maximized the power of blogging, attracting the first 100 customers.
In 2018, ZenBusiness raised $55 million in a Series B funding round, valuing the company at $1.7 billion. In addition, ZenBusiness raised $56 million on a $250 million post-money valuation, further solidifying its financial foundation. The company’s valuation has continued to grow, reflecting investor confidence in its business model and market potential. ZenBusiness’s ability to attract high-profile investors, including Mark Cuban, and secure substantial funding has been instrumental in scaling its operations and enhancing its service offerings.
ZenBusiness’s journey from a startup with zero revenue to a powerhouse with $85 million in ARR exemplifies the potential of a customer-centric, innovative approach in the SaaS industry. With its comprehensive service offerings and unwavering focus on customer success, ZenBusiness is well-positioned for continued growth and success in the years to come.
The company spends a lot of time and money investing in getting the right product to the right customer at the right time through every possible channel, including outbound sales.
ZenBusiness’s approach of cross-selling and not taking customers for granted is essential. “Once you sell them, that’s when it starts,” says Ross. The company focuses on ensuring ongoing value, customer referrals, and a robust exchange to retain customers and drive revenue growth.
Ross Buhrdorf’s vision and leadership have been pivotal to ZenBusiness’s success. His experience, combined with a relentless focus on customer needs and a robust business model, has positioned ZenBusiness as a leader in the SaaS industry for small businesses. As the company continues to grow, it remains dedicated to its mission of simplifying and supporting the entrepreneurial journey for small businesses across the country.
For more insights to how to grow your business to $100M, check out the interview with CEO Ross Buhrdorf:
