Arvid Kahl: Welcome to The Bootstrapped Founder. We've all
heard of climbing the corporate ladder. But my guest today,
Emmet Gibney, takes this concept to a whole new level. He shares
his remarkable journey from customer support to the role of
interim CEO at Rewardful. We discuss about this transition
and the expansion of the company on the new private equity
ownership, how Emmet stepped into the void that was left by
the original founders and just how incredibly impactful
referral and affiliate programs can be for us indie hackers.
From setting up the perfect referral program to identifying
the ideal affiliate profile for your business, we just unpack it
all the tools and tactics you need. It's all in there. And
then we dive into the role of building and contributing to
communities for maximum impact as well. A big shout out at this
point to acquire.com, the sponsor of this episode. More on
that later. Now, here's Emmet.
Emmet, thanks so much for being on the show. Tell us a little
bit about your journey with Rewardful. What's your job
there? How did you get it? And what does a day in the life look
like?
Emmet Gibney: Sure. So my journey with Rewardful actually
goes back to before I actually started tactically working for
Rewardful. So I've been working for Rewardful since, say, March
of 2022, I think so maybe a little bit more than a year and
a half. And but before that, so back in, I hate to pull up the P
word. But back around the pandemic times, I had been
working for a travel company here in Dublin. And I've been
working there for a few years and then the pandemic hits and
like the absolute worst industry to be in when the pandemic hit.
And so the company went from, like, 120 people to 10 in a, you
know, in a couple of weeks kind of thing, right? And I was one
of the people who got laid off. And so, you know, trying to
figure out, like, oh, like, what am I going to do? And hiring
just like, you know, ground to a halt. And I kind of, in a way, I
was thinking you know, I'm just gonna take it easy, do a little
bit of like, coding and you know, brush up my Ruby on Rails
skills. And it was actually, like, I know this wasn't the
case for a lot of people. And maybe people don't want to hear
this, but that first sort of part of the pandemic was
actually a very nice time for me. Because, you know, it was
kind of stress free, you know, no work and we were having a kid
coming, you know, a few months later. And so sort of a last
hurrah of freedom before parenthood began. Anyways, I had
known the guys who founded Rewardful for a number of years,
maybe close to 10 years at that point in time. And reached out
to Colin Brady, who were the co-founders with Brady Cassidy.
They're the founders of Rewardful. And just said, like,
hey, like, do you need to help with anything? You know, I'm
unemployed and have some spare time. And they're like, yeah,
like, we're just drowning on support. Can you come and help
us with support? And so I just typed into intercom and help
them out with support and you know, helping people figure out
how to get the affiliate tracking installed and did that
with them for a few months. And then our kid arrived and I said,
okay, you know, I'm just going to focus on helping out at home
for the next little bit when now that the kid arrived and then I
got a job shortly thereafter because, you know, you need to
have an income if you've got a kid. And so I worked a real sort
of classic corporate job for another kind of year in a bit
and did not enjoy my time there. But it was like, you know, for
personal reasons, we need to like get a mortgage and needed
to have, you know, kind of a stable job. And once that was
settled, then I reached back out to Colin Brady and said, hey,
like, you know, I'd love to work with you guys on a permanent
basis. And my background professionally was in sort of
product management and bit of like content marketing and
things like that. Anyways, reached out to the guys. And
they said, yeah, sure, like, you know, we've got, you know, we've
got a spot for you and went and joined them in March of 2022.
And for the first call it eight or nine months that I was there
was primarily working in kind of a marketing capacity and some
background context. Rewardful had been acquired by private
equity company or group called saas. group, which is currently
the owner of Rewardful. You can go to saas.group if you want to
learn more about saas. group and if you're interested in selling
your SaaS company, you can go check them out. And so they had
acquired the company a few months before I had joined the
company full time. And so, come November 2022, Colin Brady had
finished their, I think or no period is sort of the technical
term. And they decided that they wanted to move on. They've been
working on Rewardful for, you know, five years, mostly, like,
on the side of their full time jobs. And so they were pretty
tired and decided they wanted to, you know, take a bit of a
breather. I think Kyle had a just had a kid and decided,
like, you know, he wanted to take a bit of a step back. And
so November, at that point in time, there was, I think, five
or six of us calibrated then left. And so our team went from
six to four and the company was growing quite rapidly. And so
within the group, not just within Rewardful but within the
group, trying to figure out like, okay, you know, what do we
do now? We've lost the CTO and effectively CEO of the company.
And one of our, I guess, lead developers, I don't know what
his title was actually at the time, but Chris Kottom. He
stepped up to be the CTO and then we started effectively,
like, external CEO search. And then I moved up to being head of
product, which is sort of a portion of Brady's role. And but
in the intervening months, I basically started taking over a
lot of sort of the CEO type functions, you know, like
handling all this stuff in terms of finance and reporting up to
the board. And, like, all the sort of, you know, firefighting
that you do in that type of role. And once a quarter, we
basically have a presentation that we give to the guys that
run saas. group in terms of how we're performing and what we're
doing and initiatives and things like that. And I basically said
to them, like, listen, I've been basically, you know, running the
business for the last few months. I know we've got this
external CEO search. Would you mind if we pause that? Let me
continue to operate in this role for the next several months. The
place hasn't burned down yet. If it doesn't burn down, you know,
within the year kind of thing, can I do this, you know, on a
permanent basis? And they said, yeah, we'll let you do that. And
that's where we are now in sort of an interim CEO of the
business. My title is technically head of product. But
in terms of, you know, your question around on a day to day
basis, you know, what does my day look like? You know probably
5% or 10% of my job is actually product related. There's so many
other aspects of the business. So like, you know, today I was
reviewing a new template for our data processing agreement. Every
now and then we get requests from people who are in Europe
who want a data processing agreement. That's sort of a
requirement under GDPR when you're working with what we
would be technically classed for a lot of our customers is a sub
processor. So diving into marketing, we're starting to do
a lot more content marketing. I used to run a video production
company and sort of a past life. So content and particularly like
video content is something that I'm pretty comfortable. And
we're looking to hire new people. So you know, putting
together job specs, occasionally, you know, jumping
into product team meetings with the developers and our CTO, you
know, figuring out, like, which features should we be doing
next? What should we be building? How should we be
building it? A lot of customer calls, demos and sales calls.
You know, I think it was last Monday or something like that, I
had eight customer demos in one day. So that was a very busy
day. So there's a lot of that almost every day there's at
least one sort of customer demo that'll be doing. And, you know,
a lot of sort of firefighting little things that come up, you
know, you need to address and so it's a very varied role. And
it's kind of the way I like it. I am more of a generalist
generalist. I like breadth as opposed to depth. And then, you
know, the guys that run saas. group, they run like 14 or 15
other companies. And as result, they've kind of leave us at it
as long as things are going well. They give us enough rope
to hang ourselves with. And so far we haven't. So yeah, that's
a little bit of sort of my journey and what I'm doing it at
Rewardful. And yeah, what my sort of day to day looks like.
Arvid Kahl: Wow, thank you for sharing all of this. That's a
wonderful and very rare example of just growing into the role of
CEO in the business. It's just feels like usually like if you
have an external one, they come in and they take over. And it's
kind of a top down approach. But your whole journey with the
business and the founders is a very organic one starting out in
support, getting into product, into marketing and then moving
into just doing the job that needs to be done because there's
a void that needs to be filled. That has a very indie hacker
like touch to it, you know, like, it's just you do the
things that need to be done because that's the way forward.
That's really cool to hear. And the fact that it's a very varied
job well, yeah, that's just the role of a CEO in a small SaaS
business like this, right? You have to do everything. I really
appreciate that you mentioned saas. group here because you
said they're running like 15-18 other companies. They almost
bought mine. Like we were actually in conversations with
them selling Feedback Panda. We went for it with a different PE
group at that point. But we actually had negotiations about
that, too, when we sold back in 2019, right? That was the time
that we talked about selling our Productivity Online Teacher
business. So I have a relationship with saas. group.
And it's interesting to see how far they have come since then as
well. Like the last couple of years, they've been busy if
that's the current portfolio that they're operating
Emmet Gibney: Yeah, they probably would have been about
three or four or something like that, at that point in time.
Arvid Kahl: It wasn't that much. We would have been one of the
first. It didn't align because we were in a market that, you
know, wasn't that interesting, apparently or the way that we
ran the company was different. But no matter why it didn't work
out, it's cool to see that it worked out for Rewardful. And in
a way that also worked out for you, right?
Emmet Gibney: And I got very lucky, like you're saying in
terms of this natural progression. Like, yes, it was
this kind of this natural progression in a lot of ways.
But I was lucky in a lot of respects in that the opportunity
presented itself. And I was lucky that they were open to the
idea. You know, they could have very easily said, well, no.
We're going to continue our search to find someone external.
You know, they've just spent, you know, X millions of dollars
to buy the company. And we're going to protect that investment
by, you know, getting a steady hand who's done this kind of
stuff before. Who are you? Right? And I mean, technically
still, they could do that, right? Like they might decide
that, you know, they want to find someone with more
experience and so forth. But I've been very lucky, maybe some
additional context too is prior to Rewardful, Kyle Fox and I
were actually co founders on another startup, which was
healthcare software startup. And I don't know if you've had any
experience or know anyone who's had experience in the healthcare
industry, whether in software or otherwise. But it is a brutal
industry for startups. And anyone who's ever, you know,
subsequently come to me and asked about, like, advice in
terms of healthcare software and startups and stuff I've said,
basically just run, like, just don't because it's just such
like a enterprise sales cycle. But the point of bringing this
up is just that Kyle and I had had worked together previously,
so you know, wasn't coming in just like totally cold and
having no kind of working relationship, that kind of
thing. But I've been super lucky. And the guys at saas.
group have been super like, supportive and not micromanaging
everything we're trying to do and which I totally could have.
And I've heard of cases of, you know, PE groups that that's how
they kind of operate. And so we've been really lucky that
they've been awesome.
Arvid Kahl: Yeah, I was wondering because usually when
you sell a software business, when you're just like a couple
of founders and you built it too, a meaningful but you know,
not like enterprise level, just amount of MRR or ARR. And then
you sell it, there's a kind of shift in the incentives and the
goals that you may have had compared to the goals of a
private equity group. Did you find that you had to make like
significant changes that the original founders probably would
not have made in that business?
Emmet Gibney: No, I don't think so. Not yet. Like I think part
of the part of the reason why they left was and maybe I should
not say anything just because like, I don't actually 100% know
what's in their brains but like, I think there's a little bit of
a different kind of not so much skill set but like preference in
terms of different stage to be working at. And the types of
things you have to do are very different, like that very early
stage when you're building like from zero, you know, what's that
period sale book, zero to one, like, that's the hardest kind of
phase. And I think there's a certain kind of skill set and
like comfortability with chaos and this kind of thing. And I
think like, you know, Colin Brady are really good in that
stage and I can see, like, they've already gone and started
new projects. They've got a new project they're working on
called Review Rocket, which is basically like helping SaaS
companies get reviews on, you know, all the different set of
software review platforms. And so, you know, in terms of that,
like next stage that, you know, we certainly haven't done
anything where it was like, oh, we wouldn't have done that or
like the team has grown a bit like, you know, we've added
three people, which is not a huge amount of people. But when
you go from four to three, you're, you know, you've almost
doubled the size of your team. And, you know, you're doing a
lot more hiring. That's a big one, like things really change
in terms of the dynamic when you add more people. And then
there's other stuff that's it's the comes in that it's not so
much about the stage that Rewardful is and this stage of
Rewardful is going to put a lot of it's actually about the stage
that saas. group is in and the stage they're going into. You
know, we've gone from four people to three people, which
is, you know, whatever. But saas. group in September, we had
like, a all portfolio get together in Lisbon and there was
100 ish people in that came, maybe 120 we're in the total
group. And now I think we're at like 220 or 30 or maybe 50, I
don't know, right? And so we're meeting again in September, this
time in Barcelona. And, you know, they're bringing 200
people from all around the world. But the point I'm getting
to, though, is that the types of processes that you need to have
in place, one to manage all these different portfolio
companies, but then also as sort of like a central body, right?
So like centralized HR processes, centralized finance
processes, recruiting and hiring kind of processes. And I think
they've done a pretty good job of kind of having the best of
both worlds where I only speak for our company. I don't know to
what extent it's like this for other portfolio companies,
pardon me. We certainly feel like we have the autonomy and
room to run and to, you know, feel like a startup whilst
living within this broader thing, right? And so we have the
benefit of sort of structures and there's, you know, HR
processes and you know, finance handles payroll and so there's
all that kind of stuff that normally, you just don't expect
in a startup like, you know, onboarding and helping
onboarding like, you know, what are you talking about if you're
in like a five person product? Yeah, I don't know exactly. And
so we have to the benefit of some of that structure and then
also have the benefit of like, they kind of let us operate and
do what we want to do. And we'd let them know what we're up to.
And you know, so far, I haven't felt over pressure to do
something that we weren't thinking we were going to do
anyway. And the other benefit too is like, these guys have a
fountain of knowledge and experience in software and SaaS
businesses. And across the portfolio, we've got access to
huge amounts of help, like, both on an internal team basis. So
like there's a marketing team and a product team. We need to
get like a designer to help with product work or we need you
know, we got a lot of help from the internal marketing team on
optimizing pay per click and content and SEO. But then across
the different portfolio companies, you know, just
reaching out to one or the other, it could be a founder or
there's a CEO one of the other companies or it might just be
like a head of some, you know, team. Like I reached out to the
head of sales at Pipeline. It's one of the other portfolio
companies. They're a CRM company, just asking them about
sales and setting up you know, we're thinking about we don't
have any outbound sales, but just trying to understand how
are they doing that? Or you know, support talking to someone
like, you know, how can you, you know, manage support and all
these different things. So it's just been a huge learning
experience working with them. And it hasn't felt like, you
know, you need to suddenly there's this kind of, you know,
the board coming in and simulating into some sort of
like process. You know, that's ultimately like enterprise-y
bureaucratic in nature. So we haven't felt that at all, which
is awesome.
Arvid Kahl: Yeah, I do like a good Star Trek reference. So
thanks for that. But honestly, this is something that I've
noticed too, as we transitioned our company to the private
equity company that we sold to, just to see the
interconnectedness of all the other portfolio companies in
there and how easy it was for the developer that we hired to
go and work on other projects, if there was downtime, if they
didn't have anything to do on ours. That was really
interesting. And it's something that I was kind of afraid of
that, as a founder of a business. I didn't want other
people to interact with me. I wanted to build my own thing,
right? Which is why we never hired. It was so bizarre. We was
just Danielle, my co founder and girlfriend and I, together
running this business, never really hiring anybody having
1000s of customers trying desperately to keep them under
control, then we sold the business and we transitioned it
over. And all of a sudden, there was this interconnected group of
also hundreds of people just doing the work together much
better than we would do it alone. It was a humbling
experience for me as an indie hacker to see that this was an
option. And as you said, the cofounders of Rewardful, they
probably might also feel like this and they're probably right
to feel like in their state of how they want to build a
business, just in my perspective and opened my eyes to that there
is a way past the isolated indie hacker experience into a much
more collaborative, bigger system. But that still allows
you to act individually. That's really cool to see how well that
worked for you. I guess it depends on the private equity
company you work with, right? Not every company will give you
that much leeway.
Emmet Gibney: Yeah, no, and I think as you're saying that and
kind of your experience there, that was a thought that entered
my head is like, I have, you know, one data point. And it's
been a good experience. I was an employee, right? So my concern
was more about like, oh, geez, like, what's my work life gonna
be like? But I can imagine, like, as a founder, you know,
being really worried about, you know, someone's going to mess
with my baby kind of thing, right? And yeah, so I think
like, you'd want to be careful and do your due diligence if
you're, you know, an indie hacker looking to sell your SaaS
product or whatever, to make sure that they're not going to
just, you know, ruin what you've created or just like make that
process, you know, stressful. And, yeah, like, I think it's
definitely something that people should consider. As I've been in
the machine now myself, I've been thinking like, oh, if I was
ever to do this, I'd want to stick around kind of as long as
I'm learning stuff because I've just learned a huge amount, you
know, just kind of seeing the way these other companies are
run. And I have access to a lot of sort of metric type
information and a lot of these different companies and seeing
the things they're doing and benchmarking and seeing like,
okay, like, you know, this is how much revenue they're making
per employee. And, okay, this is how much they're spending on
their PPC. And, okay, like, the CRM industry is very different
from like, our industry. The customers are different, their
go to market and kind of benchmarking these different
things. And it's just been, you know, I think education, you
know, I'm sure getting, you know, bought out is probably the
primary driver. But like, just learning and personal growth as
an entrepreneur, I think, is a huge reason to join one of these
types of groups. And, yeah, definitely, I think it's a
worthwhile option to look out for people.
Arvid Kahl: Yeah, I mean, getting bought out, that's the
dream, like getting the financial stability, security
and beyond. Obviously, that's why most people or many people
at least built the thing, why they get into something as crazy
and risky as entrepreneurship. But I think the learning along
the way, in retrospect, I find that that was more important in
a certain way, obviously, financial security is a
wonderful thing. And we got that too when selling Feedback Panda.
But the learning along the way and keeping learning beyond,
that is more important for just to have a continued life of
achievement or just to feel fulfilled, have passion of
purpose, that still needs to happen. Because if you just stop
working on the product, somebody buys it from you. Now you have
millions. What are you going to do? You're not going to sit on
the beach, right? That is the illusion of entrepreneurship is
that you're going to retract completely from life and just
sip daiquiris every day. That's not going to happen. You still
need to, you have this passion, you can actually mobilize this
passion, you want to keep mobilizing that passion. So it's
really cool to see that you're getting this without the
existential risk of having somebody destroy your baby,
that's really cool. For you, this is a great situation. And
one thing that you said earlier that I find almost hilariously
fitting is that you're kind of you got referred into your spots
for a company that does referral or helps other people with
referral systems for you to be constantly referred into a job.
It's really, really fitting. I would like to talk about
referrals a little bit because from what I understand your
target market is indie hackers, people like us, people like me,
people who are building businesses and I guess many
people don't really understand the value of a referral system
or an affiliate system. And I would like to, I guess, give you
the opportunity to convince me that my next SaaS business
should definitely have either affiliates or a referral system
or both. So try that.
Emmet Gibney: Yeah, sure. So first off, I'll make the
distinction between a customer referral program and an
affiliate marketing program. And this is good timing because I
just before I was on this call with you, I was actually just
recording a course for this. And this was like the, you know, the
slides I was going through, so it's timely. So customer
referral program, the key distinction between the two is
basically a customer referral program, you're not gonna be
paying people a commission. Typically, it means like, you're
paying them like a credit or something like that, right? So
imagine Feedback Panda, if you had a customer referral program
and you know, customer A refers customer B to join. You'll give
them like, maybe a free month or something like that. And you
would credit them, you know, so that, like, there's no exchange
of cash. There's no commission. Customers, you know, they
obviously, it varies depending on the industry, but they
oftentimes can't be bothered with like signing up to your
affiliate program and you know, getting paid out and Pay Pal and
all this kind of stuff, right? So that's customer referral
program. Affiliate Program is I'm an affiliate and I want to
make money and I'm, you know, maybe I've got like a blog or
I'm an influencer or something like that. I'm trying to
monetize my audience. I'll go looking for affiliate programs
to join, where basically, I can refer customers to these
businesses and they're going to pay me in commissions cold, hard
cash, right? Rewardful enables both situations. Customer
referral programs is a little bit more complex in terms of the
installation and sort of building of it. Because there's
more interaction in terms of, you know, doing a credit within
Stripes, API and this kind of stuff, right? Affiliate Programs
is much easier to set up within Rewardful and whoever you're
going with. And so in terms of why you want to use either of
these, word of mouth marketing is a very effective way, maybe
the most effective way of getting customers. Anecdotally,
even beside our affiliate program, a huge amount of
customers that Rewardful gets, as people just talking about us
on Twitter. Someone asks like, I want to set up a, you know,
affiliate program. Who should I use? And someone chimes in and
says, you know, checkout Rewardful. And so just word of
mouth is very powerful. And so if you can incentivize people to
refer customers to you, that's a great model, right? You're
rewarding your existing customers for bringing in new
customers. The new customers know that if this person is an
existing customer, well, they're not going to refer me to
something that they don't want to use and so that social proof
you know that speaks volumes, right? And then in terms of
affiliate programs, they work a little bit differently. The
principles are the same in terms of word of mouth is valuable.
But you know, probably people might be a little bit more
guarded when an affiliate says you know, check out this
product. Everyone knows you know, influencers now like you
know, hashtag ad or whatever they've, you know, if they're
doing an Instagram post or tweet or whatever. But it might not be
as impactful in terms of, you know, people might be a little
more skeptical if an influencer is recommending something. But
you understand this. You know, the Twitter audience guy and
building relationship that an influencer or anyone with an
audience, they have social capital with that audience. And
they can drive commercial behavior, right? You know,
recommend some sort of product if it's a fit in terms of
whatever their you know, expertise is, right? Like, if
you were to become an affiliate for Typefully, that's a customer
of ours. They've got an affiliate program. And you were
to recommend this is a Twitter tool, it's a perfect fit in
terms of your audience. That would probably perform quite
well. And you'd probably make some decent money off of it and
Typefully gets customers that are, you know, that are within
their ideal customer profile and so forth, right? So it's a good
fit in that perspective. In terms of some numbers, that
might be interesting. It varies greatly, obviously, from
business to business, industry to industry. But typically what
we'll see is for a business that is up and running and generating
revenues already, typically, you'll see anywhere from 5 to
15% added to your MRR. In some cases can be higher. And then
obviously, in some cases, it doesn't work for some businesses
or they don't make it work because you don't put in the
effort to run the program. And so if you're already up and
running, it's just a great channel to add to your marketing
mix. And it's just like leaving money on the table by not, you
know, operating an affiliate program. Obviously, there's a
bit of work to do. We can talk about that in a bit in terms of
best practice and how to make it worth your while. But it really
is just like a great channel to add. There's also another factor
to take into consideration is launching a SaaS or any kind of
launching any kind of business, right? You've operated in the
course world and info product world. And that's an industry
where we have a lot of customers in that space as well. That's a
space where a launch really works quite well, right? Like
building a hype to something and then releasing it at launch. And
then, you know, either you remove whatever the sort of
promotion is or you remove it from the market, that's a common
thing. And so if you can launch with a group of affiliates
behind you, you can expand your reach and get much more people
into that sales process. And we've seen some ridiculous
stories of people launching SaaS products. The case study that's
actually on our website. And it's something we've got, if
people might see our ads on LinkedIn and YouTube for this
particular case study. A customer of ours called Commonly
and they launched, I can't remember exactly when it was
2020 or 2019. But they launched and within their first week,
they hit $54,000 in MRR and that was with one or two affiliates
that were kind of perfectly placed within their market.
Caveat like you know, disclaimer etc like, results will vary and
don't expect you know, not everyone should expect that. It
really comes down to the quality of the affiliates. We had
another case. I can't say who they are because we haven't like
they haven't agreed to give us a case study and that kind of
thing. But we had one customer back in March. And they launched
their business in I think it was like the first or second week of
March and by the end of the month, they had hit $800,000 in
sales, from zero to 800,000 in like two or three weeks and then
it like it drastically kind of tapered off from that. You know
it's a real kind of classic launch where it's like peak and
then it kind of trickles off to you know some kind of more
normal level. But like this, we've seen some insane stories
and sort of in terms of people launching both SaaS and info
product type businesses using their affiliate programs and so
yeah that's kind of the pitch to like why you should set up an
affiliate program. It's not easy to have those type of results or
even just to run an affiliate program but it's not
complicated. Like there's some pretty simple principles to
adhere to and but yeah like any SaaS business that is in a
product led you know self serve SaaS type of model should be
considering adding it to their marketing mix for sure. Yeah
Arvid Kahl: Yeah, you convinced me. You not only need to
convince me now you also convinced me retroactively
because we did have such a model for Feedback Panda. And it was
an internal like a customer referral system. I built this
myself because I didn't know any tools existed and it was
horrible to build. So I'm glad that you actually offer
something that I could just plug into Stripe. I would prefer
that.
Emmet Gibney: To everyone out there, don't do it yourself.
There's a lot of stuff that's going on in the background and
background processing and all this kind of stuff. You don't
want to, yeah, it is a whole other product, like. Yeah.
Arvid Kahl: It's like building Stripe yourself and doing credit
card charges all by yourself. It's just really not worth it.
And then that's the thing, my indie hacker journey was full of
lessons on what I should not have built in retrospect. This
one was one of them. We did, I think like a two sided or maybe
even a three sided win win win situation. We gave people a free
month if they gave somebody or if they got somebody else onto
the platform. So that's going to, you know, I think three
people, you get a free month because we wanted to have a
multiplier in there. And then each of these people that came
on also got their first month for free as a double sided
incentive. And we can talk about the specifics in a second. I
just want to get back to what you were saying about SaaS
businesses, launching with an affiliate system, which is the
other side of what you offer. I've seen this done extremely
successfully in several products over the last couple of weeks
and months. In fact, over the last couple of weeks, I talked
to two indie hackers on this podcast. One of them was Tony
Dinh, who had launched Black Magic, which is also a Twitter
tool with an affiliate system. And it was quite successful. And
I think just last week, you know, on this show, I talked to
Louis Pereira, who launched Audio Pen, which is a ChatGPT
based audio to summary conversion tool. That's a very
basic way of describing it. It's really cool, got to product of
the day, second product of the week and fourth product of the
month on Product Hunt, got a lot of initial success, also
launched with an affiliate system and made significant cash
just from that by having people be affiliates that are really
aligned with his audience. And that's something I wanted to
talk to you about because I have a horror story here. Maybe
that's a bit strong of a term. But earlier today, I got an
email by a company that I have never heard of before. And they
just told me how they would love for me to be an affiliate for
their product, just click here and you become part of my
affiliate system. That was kind of their pitch in that email.
And I was looking at that email. And I was thinking, like, I
would have probably been interested in this company if
they hadn't just tried to push me into the role of an
affiliate. So I think there are ways to do it really well. I'm
looking at Louis and I'm looking at Tony and how they started
their journey with the affiliate system and ways to do it not
well at all, which seems to be a cold email sent to a massive
amount of people asking them to join the affiliate system. So
how do you find the right people? As a SaaS entrepreneur
who wants to have affiliates to send this to without breaking
trust? Like, that's what happened to me today in that
email. I don't trust this company. They just want to make
money off me and my reach. That's how I felt. So I'm not
going to get it. Again, I'm not going to go for that. On the
other side as a founder, how do I get the right people? And how
do I build trust with people so that they becomereliable and
trustworthy affiliates?
Emmet Gibney: Yeah. So the first thing that springs to mind is
important, I guess, in terms of managing expectations and around
affiliates and your affiliate program. You know, everyone's
heard of the 80/20 rule. Right? So 20% of your results will come
from 80% of your efforts or inputs, right? This applies in
affiliate marketing, but it's more extreme, it's more like
99/1, like what 1% of your affiliates will drive 99% of
your results, right? So the good news with this is it means you
don't need a lot of affiliates to see actual results, if you
can find the right affiliates. So it's following this kind of
classic power law, right? Like where you've got a huge amount
of results from small number of people and then it kind of this
long tail, the long tail is valuable. Like there's value to
be had there. And I would say though, like it's probably more
worth investing in, like these more kind of power or higher
influence type of affiliates. That's where the value really
is. And it really is just about trying to build relationships
with these people, right? So the advice I commonly give to people
is, first step is to identify your ideal affiliate profile. So
in marketing and sales, you talk about like your ideal customer
profile, right? Like who's the ideal customer you want to go
after? For us indie hacker is one of our two sort of main ICPs
ideal customer profiles. And so for an ideal affiliate profile,
you got to figure out okay, for my product, the market that I'm
in, who are the people that my customers are engaging with,
right? And so that example I gave earlier of Typefully and
that's probably like a pretty pretty good fit in terms of
audience, right? And so like if I was Typefully, what I would do
is first step is identify that ideal profile. Second step is
start doing research to put together a list of people that
fit in within this profile. What I've done in the past is I've
gone to places like Upwork or Fiverr. And get them to do the
research because it's kind of it's time intensive. And if
you've got the budget for it, you can find virtual assistants
that are quite affordable. And you know, put together a
spreadsheet with all the different sort of data points
you're trying to find from about the people. So like, you know,
name, website, email address, twitter handle, number of
followers, etc, etc, etc. And do like 10 of them and then go to
Upwork and say, okay, I want you to find me as many more of these
people as possible. Here's kind of the profile I'm looking for.
Go research for two hours and then come back to me and show me
what you've got, look at what they've got, you know, give your
feedback to kind of refine their search and then send them back
at it. And, you know, get them to research as many as they can
find or as many as you can, you know afford within your budget.
And now you've got your list of people that you're going to
reach out to. Then the next step is the outbound outreach
process. And this is where you want to be really careful, like
you don't want, even if you are doing cold email, there's a way
to do cold email that feels better and less greasy than
other ways, right? And the way I would and I'm no cold email
expert, but the way I would categorize it is like, there's
certain elements of the outreach you're going to do that are
somewhat formulaic and then other elements of it that are
going to be personalized. And so you got to kind of figure out,
like, what those are, right? And actually do a little bit of
research on all of these different people that you're
planning to reach out to. And the bigger the audience is for
these people you're reaching out, the more time you're going
to want to spend to try and win them over. And so if I was
trying to sell some, if I was Typefully and I was trying to
recruit you as an affiliate, I'd be like, okay, like, this guy is
like, perfect in terms of audience, match and relevance.
So like maybe we just take it off to the cold email and we try
to build that relationship in a different way, right? And
actually start going to try and engage with them, you know,
follow them on Twitter and start like, you know, your courses
talk about like how to build these relationships with with
people, right? You know, try not to be quite so, don't be quite
so transparent in your transactionalness, right? Like,
actually try and build relationships with partners. So
that's what you're doing. You're trying to build partnerships.
And it's worth the time to do that with people that can drive
those results, you know, that 99/1 rule I talked about. Like,
okay, those people that are in that 1%, like, take the time to
build those relationships. Look at it as more of like a
partnership as opposed to just this very transactional
affiliate type relationship. One of the things, one of the
questions that we get from a lot of prospective customers is do
you guys have a network? And so there's a lot of affiliate
networks out there where they do both the affiliate tracking and
management as well as they've got a network of affiliates. So
you think back in the day, like Clickbank and commission
junction and these different places where it's more of this
marketplace of products and affiliates. So we have a lot of
prospective customers who come to us and say like, oh, do you
have a network? Oh, how am I going to find affiliates? And in
that there's this misconception, there's this false assumption
that the value and value is in like these transactional
relationships. Oh, people will find me on the network and
they'll come and promote my product. That is true, like
people will find you and maybe they'll sign up for your
program. But they might not be the people that you want to be
promoting your product. They might be promoting your product
in a way that you don't like. You don't know them. They're
totally faceless. And there's all sorts of kind of gaming that
people can kind of do that you don't want them to do. And so
the quality of affiliates you get from these networks is not
like you're not going to find Arvid one of these networks,
right? Like the way you're gonna find Arvid as a partner is
through trying to actually build a relationship with them, right?
Like, you know, any like market that you're in, you're in a
community right? I come back to this kind of analogy in my head
over and over and over again. When it comes to business, it's
like in sports. And for people who've played competitive sports
we'll get this, where, you know, if you're in a sport you're
competing. And even though all your opponents there that are in
this community, you're all part of the same community. You go to
the same tournaments or the same leagues or whatever. And you see
each other day in day out and you become friends with these
people, even though they're your competitors. And a market is
quite similar. All the people that are operating in this
market, it's the same sort of thing, it's a community. And the
people who are very transactional aren't just coming
into a market because they want to make money. The people who've
been in that community forever and are kind of the mainstays
and the sort of stayed members of the community, they'll sniff
these people out in just like, in a heartbeat. And they'll just
be like, okay, like, I'm gonna stay away from those people
because like, like, they're not good actors within the space.
And so this email you got, it gave you that feeling of like,
oh, here's an interloper. This person is a blow and they're not
part of my community. Otherwise, like, they wouldn't have engaged
with me in this way. And you can kind of sniff that out. And so
if you're just going to be really transactional and just
like sent a spam to a bunch of people and not put any research
into who they are and your outreach, they're going to smell
that out, right? And so at least make the effort to try and make
them feel like, you know, you're worth my time. That's the way
that I would go and try and the way I would think about it. You
know position it in your mind that I'm trying to build
relationships with people. For those really kind of, you know,
more high influence type of partners. And then there's other
kind of more passive ways that you can get just sort of the,
you know, the generic people coming in trying your program.
Arvid Kahl: Yeah, thanks. That makes a lot of sense. I think
the focus on being more relational than transactional,
even though it is about transactions in the end, like an
affiliate is a sale of a thing, right? That is in itself a
transaction. But how it comes to be, that is relational. And I
think making that differentiation is at the core
of building these kind of long term sales relationships in the
end. It's funny, like, you want transactions and you have to be
the least possible transactional to get there. It's just an
interesting observation. And the community centric approach is
also something that I've personally felt in the Twitter
course space, for example, like you mentioned the course that I
have. I compete with a lot of people who talk about building
audiences on Twitter, but we all know each other. And there was a
moment when Daniel Vassallo, the guy who has one of the biggest
Twitter courses out there. I was talking to him a lot after
recording mine and I was saying, hey, Daniel. I'm gonna compete
with you a little bit on this. I hope you don't mind. And I said
that in a Twitter DM because we are connected and we talk all
the time. And he said, hey, I said what I want to say. Now you
say what you want to say. And now we are both affiliates off
each other on Gumroad. Like he recommends mine. I recommend
his. In my course materials, I list like three or four
different Twitter courses by other people because I know they
list mine. Because we all know that in this space, the more we
can combine our knowledge, the better it will be for the person
taking it in. It's a very community centric approach and
just trying to transact in there, that would not fly. So
perfect description of that space.
Emmet Gibney: Yeah, that's very common in the info product space
to have kind of this and much less sort of combative or
competitive type of environment. Obviously, you know, if you're
looking for like a social media management tool, you only need
one. So there's not that same kind of opportunity. But I was
talking to our mutual friend, Andrew McIntosh last week. And
the analogy I get to him around this idea was like a nightclub
district. And there's some markets where it's like a
nightclub district where you don't want to go to the bar that
has no other bars around it. You want to go to the nightclub
district and you go to a bar there and it's been an hour and
then you go to the next bar and you know, people bar hop. Info
products are very much like that, right? Where, like, you
know, you said one thing and then Danny said another thing
and Justin Jackson says another thing or whatever, right? And
just because you take one course doesn't mean it doesn't preclude
you from taking another course because they have different
perspectives on things and different things that you can
learn. So you see a lot of people in the info product space
that promote each other's you know, at face value looks like
directly competing products, but they'll promote each other.
Arvid Kahl: Yeah, interesting point, though. I think you just
pointed out effectively that people who have a one time sale
have no problem having somebody else have a one time sale. But
the moment you move into a recurring revenue system where
you need customer retention, you are less interested in giving
the alternative products or even the information about the
alternative product to your customers. As you have a lot of
indie hackers as a customer, does that raise any special
challenges around that particular kind of behavior as
well?
Emmet Gibney: Nothing that comes to mind. The only sort of, I
guess downside I've ever really encountered if we want to call,
it's a double edged sword in dealing with the indie hacker
community is incredibly vocal, right? And so when they're like
you, they're, you know, incredibly vocal and well, like
we get lots like I said, at the top of the call, like we got a
lot of word of mouth. And that's hugely beneficial for us. I
would say it's probably, it's a difficult one to actually do
attribution to but I'm fairly confident is probably, you know,
our largest if or at least one of our largest sources of
customers. The other side of that sword is when things go
wrong or people are frustrated and they take to Twitter, then
you deal with the wrath of that on the other side, where we had
a thing recently about affiliate fraud. And basically what people
were doing was using affiliate programs to bid on brand terms
on Google. And this is one of those things. So this idea of
like, you know, getting, you know, high quality affiliates
versus kind of transactional affiliates. And this is
something a transactional affiliate is going to do. They
don't care about you. They just want to make money. And the way
to do that is to bid on their brand terms, right? And so let's
say like Feedback Panda, you would imagine if you Google
Feedback Panda, that's the first result. In Google, you're gonna
have the number one result for your brand term. And so why
would you bet on your own brand term? You're already at the top
of Google. And so an affiliate will come in and they'll join
your affiliate program and then bid on your brand term and they
rank above your organic result. And people will sign up through
that. And so they're then getting a cut, they're getting
like 20-30% depending on what your commission rate is, of all
those sales. And the math tends to work because it's cheap to
bid on the brand terms because nobody else is putting on those
brand terms. Anyways, there was kind of a rash of this happening
across our customer base and people took to Twitter to
complain about this and got a lot of attention because there's
some sort of big named indie hackers that were tweeting about
this. The upshot of that is, you know, we get ideas for new
features for fraud, protection, and things like that that we're
working on and sort of hacks that people can do to protect
themselves against this kind of stuff. That's the only thing
I've seen that, you know, it's kind of that double edged sword
of dealing in the indie hacker space.
Arvid Kahl: Okay, well, that's good to know. And this is a
problem, right? Like what is it poaching or cannibalizing of SEO
rankings like that? I mean, that can cost a lot of money if you
have to bite it. Like if you want to fight that as an indie
hacker, you need to rank higher than those people who would make
money on it. It's kind of it's bizarre because you're losing
money on having to pay for clicks, right?
Emmet Gibney: Yeah, we've discovered and we give this as a
tip to people but there's some easy ways to combat this. But
for people who weren't aware of it. You know, it's definitely
something that they gotta be aware of. And again, like,
that's why I want to try and find those high value partners
because like, you wouldn't do that, you know, to mean to
someone that you have, like an actual relationship with, right?
So, yeah.
Arvid Kahl: Yeah, trust is really at the center of all
this, right? Like, the moment you turn it into a mere
transaction and it's quantifiable and somebody makes
maybe a bit less but more reliable money by putting their
name or their link in front of your actual name, you have a
problem. And if you can't trust people not to do this, well,
then you have an extra problem. Well, that is an interesting
insight into a field that I personally, have never really
professionally used any tools. And like I said, I built all of
this myself. I'm really happy that you shared all of these
insights into particularly affiliate marketing because I am
both a SaaS founder and a info product owner and to see the
slight differences between what a recurring revenue business
needs and what a info product business needs, that is really,
really helpful. Thank you so much for coming on the show here
today and sharing all of these insights with me and my
viewers/listeners. Where do you want people to go and find out
more about you and Rewardful?
Emmet Gibney: Yeah, sure. If you want to learn more about me, you
can come and follow me on Twitter. My handle is
@emmetgibney or if you live on LinkedIn, if that's your world,
then you can find me on LinkedIn. Just search me, Emmet
Gibney. And then for Rewardful, visit us at www.rewardful.com if
you want to come and check out our product and sign up. We have
a 14 day free trial. So if you want to try us out as a SaaS
business and then yeah, we're on Twitter and LinkedIn as well. I
think on Twitter, we're @getRewardful. And then yeah,
come and consume our content. And we'll do our best to educate
you on how to set up an affiliate program.
Arvid Kahl: Yeah, that is a good idea. I'm going to totally on
ironically put an affiliate link to Rewardful into the show
notes.
Emmet Gibney: Yeah, yeah with your audience. Yeah.
Arvid Kahl: It's really nice. Thank you so much for being on
the show today. That was a wonderful conversation. Thanks,
Emmet.
Emmet Gibney: Thanks for having me.
Arvid Kahl: And that's it for today. And we talked about
taking over after the founders left. Let's look at this from
the other side. If you're a founder and you feel like you're
done with the business but you want to turn it into money,
instead of just closing it down, well, there's always the option
of an acquisition. That's what happened to the people who ran
Rewardful, right? And that is, I think, what can also happen for
you. That's where our sponsor, acquire.com can help. Imagine
this situation. You're a founder who's built a really solid SaaS
product, you acquire customers, and the whole thing is
generating consistent monthly revenue. The problem is that
you're not growing for whatever reason, maybe lack of focus or
lack of skill or just plain lack of interest and you feel stuck.
What should you do? Well, the story that I would like to hear
is that you buckled down and somehow reignited that fire
within. You got past yourself and the cliches and you started
working on rather than just in the business. You start building
this audience you always wanted to build and you move out of
your comfort zone and start sales and marketing, the scary
stuff. And six months down the road, you've tripled your
revenue. Reality, unfortunately, isn't that simple. Situations
may be different for every founder who's facing this
crossroad. And too many times, the story ends up being one of
inaction and stagnation until the business becomes less
valuable, which is bad or worse, worthless. And that is really
bad. So if you find yourself here, where your story is likely
headed down a similar road, I offer you a third option.
Consider selling your business on acquire.com. Capitalizing on
the value of your time is a pretty smart move and
acquire.com is free to list. They've helped hundreds of
founders already. Go to try.acquire.com/arvid and see
for yourself if this is the right option for you at this
time. It doesn't hurt to check.
Thank you for listening to The Bootstrapped Founder today. You
can find me on Twitter @arvidkahl. And you'll find my
books and my Twitter course there as well. If Twitter is
still around, then you know find me on Twitter. If you want to
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Thanks for taking action. Have a wonderful day. Bye bye