Subscribe
Share
Share
Embed
Always Be Testing explores the experiments, insights, and growth stories shaping the future of affiliate and partner marketing in B2B SaaS. Hosted by industry veterans, the show dives deep into real-world lessons from the people driving measurable impact at companies like Google, HubSpot, Ramp, Webflow, G2, and beyond.
Each episode uncovers what happens when today's most innovative marketers challenge assumptions, run smarter experiments, and build programs that scale revenue through meaningful partnerships. If you’re in affiliate, partnerships, or SaaS growth — this is your front-row seat to how the best do it (and what they’ve learned along the way
Tye DeGrange (00:31)
Hello, hello, hello. Welcome to another episode of the always be testing podcast. I'm your host Ty Degrange. I'm really happy to have Michael Gens on the call. Michael, how are you?
Michael (00:42)
Doing great, really excited to be here.
Tye DeGrange (00:44)
Thanks for coming on. It's been great to chat with you and great to get to know what you're building. And it's, think it's going to be a fun one.
Michael (00:52)
for sure.
Tye DeGrange (00:54)
I got a little walk in with the dogs this morning before the heat hit in Austin, Texas. How's everything in beautiful Cape Cod where I believe you're at right now?
Michael (01:05)
Things are great out here.
Tye DeGrange (01:09)
It's a good place to be in the summer and I'm hoping to see you in the Bay Area when I get out there again soon.
Michael (01:16)
Yes.
Tye DeGrange (01:17)
Well, thanks everyone for tuning in. Michael is an amazing entrepreneur. I think you're in for a treat today. He's the founder and CEO of Encore. He's a product and tech leader. He attended Harvard and Stanford. And for those of you who know, Encore is an SDK that helps iOS apps make money from users they otherwise would have
Tye DeGrange (01:38)
not made money on and bounced at the paywall. Did I get that right? All
Michael (01:44)
That's right.
Tye DeGrange (01:46)
right. Amazing. So very interesting. You know, what we love to talk about on the pod is growth, AI, partnerships, testing, of course. And so I think it covers all the fun things that we want to be digging into in our industry. And I think this particular partner, Encre, which you've created is perfect for all of those things and really encapsulate.
Tye DeGrange (02:08)
encapsulates a lot of the stuff that we love. Michael, just to get us started, what's something that maybe people don't know about you?
Michael (02:17)
One thing people don't know is I grew up sort of a theater kid. I was into improv in high school and screenwriting and wrote my own with a group. We wrote a play, we performed for the school. And at Stanford, I was the president of the GSB improv team. So ran that with some friends and we'd perform every quarter.
Tye DeGrange (02:37)
Wow.
Michael (02:37)
So it's something I've really enjoyed and it's just nice to be able to be in an environment where you can kind of say anything, do anything, be super free.
Tye DeGrange (02:46)
Yeah, I love that. It's funny, I did not have that background or experience. I want to say maybe in the early days of summer camp, I got my dose of the drama and performing, which was fun, different environments. But we were going to do an improv for our team off-site multiple times. I here in Austin, we haven't made it happen yet.
Tye DeGrange (03:14)
I think some, understandably, some people are like, I don't want to be on stage. So how do you, how do you break through for people who are interested in doing it for public speaking or business or just fun or comedy?
Michael (03:30)
Yeah, we're in an incubator called Stanford StartX. It's an incubator for Stanford alums who have startups. And I teach an improv class sometimes there for new batches. And I try and just set up exercises where you can't go wrong. I'll say, OK, this is a random company. You're pitching. You're the VC. You're pitching the company. Go. And they don't know anything about the company. They just have to improvise and talk.
Michael (03:57)
I break them into small groups as well. think people struggle if it's like, everyone's watching me on a stage. But if it's
Tye DeGrange (04:02)
Totally.
Michael (04:03)
a small group, there's like 10 of these groups, it's really loud, no one can hear anything, no one's gonna remember, then people
Tye DeGrange (04:10)
Yeah.
Michael (04:10)
can break out of their shell.
Tye DeGrange (04:12)
That's super cool. I love that. I think we did something remote during COVID many, many years ago, which was pretty hilarious. Some of the things that people said, but all for fun and all positive. Do you feel like there's some positive benefit in the business world to improv?
Michael (04:31)
I think one of the biggest things with improv is sort of going with what people are giving you. in
Tye DeGrange (04:38)
Yeah.
Michael (04:42)
terms of how I understand different people on my team, for example, different people have different styles. I try and think about, what energy is this person giving out? How can I get through to them?
Tye DeGrange (04:53)
Yeah.
Michael (04:54)
And I think improv helps with that because when I'm running the company,
Michael (05:00)
Different people on the team kind of need sort of a different.
Michael (05:05)
way of addressing things, a way of brainstorming that feels inspiring to them. And
Tye DeGrange (05:09)
Yeah.
Michael (05:10)
I try and think about how can I, for everyone on the team, get the best out of them that way.
Tye DeGrange (05:15)
I think that's an awesome way to describe it. That's super interesting. What inspired you to build Encore?
Michael (05:23)
Yeah, so we were actually building a consumer app. We were building a shopping assistant app. And we had kind of a loyal user base that was interested, but we did a bunch of customer interviews. There wasn't a lot of willingness to pay. It was like, hey, interesting app. I'll use it. Not sure I want to pay a subscription for it. So I don't know if
Tye DeGrange (05:44)
Yeah. Yeah.
Michael (05:46)
anyone in the audience has a product like that, but we were kind of in a bind because
Michael (05:52)
you know, if I talk to customers, said, well, what if we put a subscription? Would you pay? A lot of them said no. And we were in growth, but we didn't want to lose a lot of people. if I said, well, what about if we put a bunch of ads flashing on the side? Also, no. okay, well, we raised venture funding. We need to make money on this. how do we do it? And so, since it was a shopping app, what we did is we said, okay, Ty, let's see if we can.
Michael (06:22)
find an offer that's really compelling to you. So maybe you're like streaming services and we can go to Disney and get them on three of Disney for you. So we started going to brands and getting these sort of offers or discounts and embedding them in our app and getting paid on affiliate for those. So that became our monetization and it was something that users actually liked. They were like, wow, it's cool. I get these really steep discounts. There's stuff I already.
Michael (06:51)
like or kind of already engaged with. And so we thought, okay, wow, we figured out a way to monetize that doesn't really annoy users at all. It doesn't ask them to pay anything out of pocket. The growth on our consumer app wasn't great. You know, we, we, we weren't headed towards millions of users that we needed. So we were like, well, going viral on Tik TOK, getting this thing to millions of users. We haven't really figured that out, but we have figured out a way to monetize that
Michael (07:20)
users actually like, that's pretty big because it seems like every way to monetize either is a paywall that's going to have a 98 % drop off, or it's pretty annoying. Most people have bad experience with ads. So we thought about how could we embed this experience into other apps and allow them to monetize really effectively, make more money than they would if they covered their screen in ads, but do it in a way that users actually like.
Tye DeGrange (07:47)
I love that. That's amazing. Very interesting. You know, the shows obviously talks a lot about the learnings and having had some really cool experiences and on the education side and within the site and some of your previous startups and what you've been building, what's kind of like shaped the how you think about users and psychology and monetization. Obviously,
Tye DeGrange (08:16)
putting things in front of them is something that is interesting to see before you see them go, leave to the next step or, and how do you think about some of those learnings that may be informed your view of how do you monetize users?
Michael (08:31)
Yeah, what I try and do is think about what I want is a marketplace that's extremely valuable, has billions of people at this marketplace, but no one is selling anything. No one's monetizing. So that's kind of like what I search for. And I feel like that's what we found with this Streaks product that we have, which has been going really well. It basically...
Michael (09:01)
It's rewarding users for being loyal customers of the app. So, hey, Ty, thanks for using this app three days in a row. You're on a roll. We really appreciate your business. We want to give you a gift. And the gift could be free Apple Music this month, free Apple TV, free Uber Eats credits, free Hulu, free ClassPass exercise classes, free Instacart deliveries. We figure out what that gift is, but it's at one of these streak moments. And a lot of apps have, I don't know if you've...
Michael (09:29)
used an app a lot. Usually they'll say, that's your first exercise completed with, with, or that's your first
Tye DeGrange (09:34)
Yeah.
Michael (09:35)
meditation completed or second. They'll show confetti. but they don't make any money.
Tye DeGrange (09:38)
Yeah, I'm thinking of a
Michael (09:40)
there's billions of these moments across apps, but none of those moments make a single dollar for any app. No one is making money on that confetti screen. So we're like, okay, that's interesting. There's billions of people.
Tye DeGrange (09:51)
unless they're losing retention.
Michael (09:53)
Yeah, they feel like this is a retention moment. They want to celebrate. They don't want to throw an ad. And I think that's the right instinct.
Michael (09:59)
but our feeling was, you know, this is a moment the user is feeling really good. there's billions of them, these moments across apps every single, every single, you know, year. and, what if we could make the user feel good in that moment and celebrated, but also turn that into a new way to monetize users, because these are your most engaged, happy users. They're excited. Why not build off that excitement with a gift? And so what we do in that moment is say,
Michael (10:29)
Ty, we're so excited you finished your first meditation. We want to give you free exercise classes this month with ClassPass. You can be calm, plus you can be fit. How does that sound? And then if you take the offer,
Tye DeGrange (10:39)
Sounds good.
Michael (10:40)
the app gets paid somewhere between $6 and $18 per free trial claim. So the user's getting a free thing. The app is getting a pretty big payout. And we have these globally, It monetizes. We can monetize users in India. We can monetize users in Nigeria, all across the world with different global offers.
Michael (10:59)
And the payouts are really big. Like we have $10 payouts in India, for example, which is really high. So,
Tye DeGrange (11:05)
Wow. Yeah.
Michael (11:07)
Rateamount has every single user and we go to apps and we say, this is something users are going to like. If you want, can put in a button which says, don't give me any more gifts. And users aren't going to pick that button because they actually want the gifts. If you put a button and you said, turn off ads, almost everyone would say, yes, turn off ads.
Michael (11:28)
But this is something that users actually want. And it's an extra revenue source. Doesn't interfere with their experience. There's nothing distracting them while they're doing something. So these completion moments. so it never distracts, never annoys. And it's opt-in for the user. They can say, no gifts, don't want it. And OK, we're back to where we were, which is making $0 on these streak moments. So yeah.
Tye DeGrange (11:51)
Yeah, yeah.
Tye DeGrange (11:54)
Now, are you finding particular types of apps are really a good fit for this situation and this opportunity? Like, what are you learning from the apps and that side of the marketplace to see who's really going, okay, this really makes sense for me versus maybe not as much of a fit.
Michael (12:16)
Yeah, I think fitness apps really like this. make sense to say, Hey, you hit your steps goal. Congratulations. takes hard work. you know, for meditation or journaling. the other thing that that's worked well is stuff
Tye DeGrange (12:30)
It's really interesting.
Michael (12:31)
where, there's completion moments like, you know, you, thanks for buying something in the app. really appreciate your business. We want to give you, give you a little gift and then you can turn all of those moments into, into extra cash. So.
Michael (12:46)
those have been kind of the moments is like when there's an in-app purchase as a celebration and then stuff that naturally is streak-based, like you're tracking progress towards, you know, your health goals, or your mental health goals. Those are kind of natural fits.
Tye DeGrange (13:01)
Yeah, that's interesting. are you, what is the, what's the experience like? So let's say I, you know, accept the class pass offer. Is there, is there a way to make that pretty frictionless so you can kind of continue on with your, with your activity within the current app or how?
Michael (13:22)
A hundred percent. Yeah. A
Michael (13:23)
lot of our offers are just sort of a couple of taps. know, free Apple music, you just tap it, double tap, you got your month free. So a lot of them are really seamless and we've worked really hard with our brand partners to say, okay, this is a new channel. It's really exciting. There's tons of these moments. You're meeting users at a really exciting time, but it's got to be frictionless. So we've worked really hard to get those flows simple enough to make this work. Because obviously if you're asking users,
Michael (13:53)
to fill out a bunch of information that that's against the point of celebrating these great moments, right? So
Tye DeGrange (13:58)
Yeah. Yeah.
Michael (13:59)
we've gotten ones that are really simple and those have been very effective.
Tye DeGrange (14:04)
That's awesome. That's awesome. When you, when you see users that are, you know, saying no at a paywall moment or like, like maybe like they're, they're exhibiting a particular behavior. What is, what is a mistake that you see teams make in terms of interpreting that signal or signals like it?
Michael (14:26)
Yeah, I would say, if you're running a consumer product, you need to have your CACLTV work. And I know this is a very basic thing to say, but you need to make more money on your users than you pay in ads. And I would say for most consumer products, that's not the case. So if that's not the case, it's time to try some stuff to monetize.
Tye DeGrange (14:54)
Yeah,
Tye DeGrange (14:54)
yeah.
Michael (14:55)
What I see with a lot of consumer founders, it's kind of baffling to me is, is your CAC higher than your LTV? Yes. Okay, great. Let's try some stuff to improve it. I'm too scared. I don't want to try anything. What if users don't like it? It's like, well, where are you heading now? If your CAC is higher than your LTV, what is the future of that? Play that out for me. How's that going to go? I'd
Tye DeGrange (15:18)
Yeah, yeah.
Michael (15:19)
be scared of that. And I would be very
Tye DeGrange (15:21)
Ha
Michael (15:22)
willing to experiment with
Michael (15:24)
things that can fix that. So that's
Tye DeGrange (15:26)
100%.
Michael (15:27)
the biggest thing is, you know, we have a product which when someone declines at the paywall, we say, hey, we'd love for you to come back. Why don't we give you, you know, free Apple TV on us and a free trial of our subscription. And it's a way to say, hey, I get your your leaving. I want you back. I want to give you something free. Two things free, free trial of our product, free trial of another. And it's been really effective.
Tye DeGrange (15:49)
Yeah, yeah.
Michael (15:51)
We've seen, you know,
Michael (15:52)
huge boost in the number of free trial stars. But we've also seen a lot of fear around the paywall. It's like, you're the CEO, absolutely, let's do it. And then from that to getting it done, there's a lot of people who kind of get cold feet and are like, I'm not sure I want to do it. I'm scared how users would view it. And obviously, once we do it, it's great.
Michael (16:20)
But there's a lot of fear and hesitation around trying anything around monetization. And I would tell founders, be afraid of your CAC LTV being upside down. Don't be afraid of trying a monetization experiment. Turn it off in a
Tye DeGrange (16:35)
Yeah, we're need a test.
Michael (16:37)
weeks if it doesn't work, right? It's not that big a deal.
Tye DeGrange (16:41)
I think that's really interesting and like obviously the core of the pod, know, always be testing. there, have you seen test structures that sort of alleviate some of those fears and like how would you advise an app to like set up a test like that even at the highest level levels? You kind of referenced the two weeks, but how would you think about that or how would your team think about setting up that experiment? Cause that's really, I think that's really interesting.
Michael (17:06)
Yeah, so
Michael (17:08)
when we help people at the paywall, we always set it up as an A-B test. we say half of people who click the X on the paywall will see us. Encore will come in and say, hey, we're going to give you a free trial of Apple Music and a free trial of this app. Why don't you change your mind? And half will see whatever they currently do, which might be nothing or apps to have different things they're doing now. And we compare revenue head to head control versus experiment. And we set that up for
Michael (17:35)
for apps and we show there's a huge boost in number of free trials. These free trials convert, you're making more money. But even to get that test going, even to say, let's run a three week A-B test, is something that for some reason apps kind of, there's a lot of stakeholders, there's a lot of hesitation. It's not a simple, simple thing. And I get there's good reasons for that. You want to be careful about the paywall.
Michael (18:05)
I would say as a consumer founder, if your CAC is higher than your LTV, clock is ticking, you're going to run out of money soon.
Tye DeGrange (18:14)
Yeah, yeah, yeah, for sure.
Michael (18:18)
Let's be aggressive about at least running an experiment that's quick and learned.
Tye DeGrange (18:20)
Gotta run some tests. I
Tye DeGrange (18:23)
love that. The interesting thing is that you kind of have two sides, right? Of course to your business and with affiliate marketing, which I know obviously come from and familiar with, you've courting the brands to offer kind of like the unique offers and paying through that affiliate mechanism is obviously unique and what we've been talking about.
Tye DeGrange (18:45)
But I'm curious about how you're finding the apps on the kind of the supply side of your marketplace and how the app process courting them, bringing them in, having those types of conversations about catkill TV and experimentation. I'm just curious high level how those go and how you're going about that because the other side of it makes I'm a little bit more familiar with in my mind.
Tye DeGrange (19:11)
Coming from affiliate, right? It's a little bit more top of mind for the affiliate community So I'm just curious how that how that's how you're approaching that
Michael (19:18)
Yeah, I mean, think everyone's facing the same problem. If I go to, you know, an app that's really small and I say, you know, how, how's your cap been doing the last few years? it's been going up a lot, right? it's probably double what it was three, four years ago.
Tye DeGrange (19:37)
Yeah. Yeah.
Michael (19:39)
and if you go to big companies, it's the same, right? So big apps, how's your, how's your cap doing?
Michael (19:47)
It's typically going up a lot. And the reason is because everyone's using the same platforms, TikTok, Meta, Google, and these platforms have just essentially thrown more ads and charged more per impression. So they've done both where now if you're scrolling through TikTok, you'll see infinite ads. You're not going to click on all those ads, right? And on top of that, TikTok's raised prices, Meta's raised prices, Google's raised prices. So...
Michael (20:15)
More per impression. And now you're getting impressions in a very flooded market. it makes sense that that's going to have a way lower return than when there were fewer ads and you were paying way less to get in front of people. everyone's facing the same reality and our pitch is simple is, know, we're going to charge you, a cost of customer acquisition. That's way less than what you would do if you were to try and scale with, with meta and tick tock ads. and we're going to.
Michael (20:44)
only take money if we actually get conversions to free trials for you. But
Tye DeGrange (20:48)
Yeah.
Michael (20:50)
in order to do this, and we're going to do it at scale, because we're going to be in apps that have a lot of users. So you're going to get a scaled channel that has a fixed cost per person. The ad's not going to saturate, and you're back where you started. This is a fixed cost per acquisition that can scale, and it's way less than the ad spend.
Michael (21:13)
you would typically
Tye DeGrange (21:14)
Yeah.
Michael (21:14)
expect to get a new user. The only thing
Tye DeGrange (21:16)
Almost there.
Michael (21:17)
we need from you to do this is a really good offer. So an extended free trial that's maybe longer than you typically do, or a discount that's more than you usually do. And we're not going to publish these on websites. We're going to put them in apps. It's not this thing that's necessarily going to get out to everyone. It's embedded in the app experience.
Tye DeGrange (21:40)
Yep.
Michael (21:41)
But we
Michael (21:41)
do need a really good offer to be able to get you scale and get you a really low customer acquisition. And that's the pitch we've been making. And a lot of brands have been
Tye DeGrange (21:44)
Yep. It's, yeah.
Michael (21:49)
willing to willing to do that.
Tye DeGrange (21:51)
That's great. Yeah, it's almost has an Airbnb feel to it because you have this unused opportunity or unused real estate that feels to me that you're saying, hey, you should monetize this. You could take advantage of this space in your home or the space in your app that you're trying to do something gamification related or not. And now you can take that space and leverage it for more revenue to make your economics make more sense, which
Tye DeGrange (22:21)
in this era is like really critical and I think it's really smart.
Michael (22:25)
100%. I think of it like Airbnb because no one knew they had this economically valuable thing, right? Like they, no,
Tye DeGrange (22:32)
Yeah.
Michael (22:32)
no one thought about that extra room in their house. It's just collecting dust. They didn't realize, you can make revenue off it.
Tye DeGrange (22:39)
Yeah.
Michael (22:39)
never thought of their streak screen as the confetti screen is like, wow, I'm sitting on tons of cash here, but I'm deciding not to make it. They just see like,
Tye DeGrange (22:47)
Yeah.
Michael (22:47)
that's a random screen in our app. don't really test on it. We don't really care that much about it.
Michael (22:53)
We did confetti this year, last year we did a fire emoji. It's not that big a deal. It's not like the core to our economic future.
Tye DeGrange (22:59)
running out of celebrations.
Michael (23:03)
Yeah, yeah. But it turns out that that could be the difference between your apps economics working and not.
Tye DeGrange (23:09)
Yeah,
Tye DeGrange (23:10)
totally. In affiliate, know, a lot of of I feel is matchmaking and finding for us as a huge emphasis on authenticity and finding the right fits and finding the fans that maybe don't know they can monetize with a brand. So there's some definitely similar themes of what you're sharing. When you think about, you know, pairing the perfect offer or a good offer with that audience and that that supply on the app side, like what are some of the things you guys go through that
Tye DeGrange (23:39)
sort of allows that to go well and perform particularly well. Like how would you, how do you think about matchmaking in this case?
Michael (23:47)
Yeah, so we basically, you know, take what the app gives us. And usually it's just an anonymous ID. So we don't have any data on the user, but we know what app they're in. And we'll run tons of offers. So we run an offer to get some statistically significant amount of views. And then we switch it and we run this sort of automated system at first to try and understand which offers work well. And then we narrow in on a smaller subset and get more data and refine.
Michael (24:17)
I'm always interested in what that process gets out. mean, we had a dating app we were working with and audible was just absolutely crushing on that platform. And I wasn't sure exactly why. but, and we don't always know exactly. wouldn't have predicted that. but, we, we kind of search tons and tons of offers. get as many good general offers as possible and we, and we run them through once we have a new app kind of.
Michael (24:46)
a through a bunch of offers until we have headway. And then once we have kind of, okay, we did 100 offers, these 10 seem to do well, then we might have a theory. then we say, okay, for whatever reason, people on this dating app are looking for audio content. What if we did Blankist? What if we did audiobooks.com? What if we did some other ones? And so then we can start to think through, you know, maybe we missed some in that 100 that are important and let's do experiments. But
Tye DeGrange (25:12)
Yeah, I love that. Nice.
Michael (25:15)
We kind of have this philosophy of let's first let the data run and make sure we're on the
Tye DeGrange (25:19)
Totally.
Michael (25:20)
right track. And then from there, we can start to be more creative and think through what would work.
Tye DeGrange (25:24)
I love that. We talked a little bit about the supply side. Obviously the brands, you know, paying the bills and kind of monetizing, you know, fueling the monetization, I should say. You know, what's been some of the reactions from them? How's that going? Are they, are they seeing some good performance? I'd love to hear just your perspective on like how you're having those brand conversations, how they're, how they're progressing. What are the brands seeing on that side? Cause for us representing brands, like we're
Tye DeGrange (25:51)
This is super fascinating because we were always interested in finding new distribution methods and new ways to get in front of their core ideal customer personas and finding them in new exciting places. So this is obviously near and dear to what we do.
Michael (26:08)
Yeah, it's been, we've gotten really good results. It's been surprising to brands because this is a whole new channel that's opening up for them. We just more than doubled our payout we get from Disney because they're really happy with performance for Disney Plus. So that's always a good sign when they're saying, hey, we want to double the payout we're giving you for
Tye DeGrange (26:28)
Yes.
Michael (26:29)
completion. We got a global deal with Uber, which is really exciting.
Michael (26:38)
You know, Uber is an amazing team because it's like they're everywhere. You know, if you go to India, if you go to Nigeria, if people want, you know, 50 %
Tye DeGrange (26:45)
Yeah.
Michael (26:46)
Uber rides, they want $15 Uber Eats credit. So it's really exciting to have those. We just got accepted into Meta's program, which we're excited for because they have the new, you know, Ray-Ban glasses coming out. And, and it's just going to be exciting to work with Meta on a bunch of different stuff. We already are in Apple's, you know, we have Apple Arcade on the gaming side and
Michael (27:07)
Apple News, Apple Music, Apple TV. So it's exciting because the Apple brand is so great globally. That's a huge one in our portfolio and it's been great working with them. But yeah, we've had really good performance for our brand partners and I think it comes from the fact that we're in these apps that people really love. They're feeling really good. And with the Streaks product,
Michael (27:36)
you know, we think the mood you're in kind of affects a lot about how you view what comes up then. know, feeling like, wow, I just, you know, completed my first three days of my weight loss plan. And now I see class pass exercise classes changes the way you view class pass. It's part of this exciting journey you're on. You have this sort of halo effect that the brand gets. And, we think that's going to drive a lot of results going forward that that
Michael (28:04)
feeling of like, I'm making progress. This is the next step on my journey.
Tye DeGrange (28:04)
Yeah. Yeah.
Tye DeGrange (28:08)
Well, I think there's some, there's beauty in this and that, you know, and it's, it's a testament to the affiliate world and the partner marketing world and the experimentation that provides, you know, Andrew Chan wrote his article, law of shitty click throughs. may have maybe have seen it before. the talked about lot in the reforge growth community. just an amazing community of like people that have
Tye DeGrange (28:33)
been product leaders and growth leaders and, know, Brian Balfour made it, made it very, popularized and important, but that the fact that you have a new inventory source that gains in growth and interest and popularity, I think brands that are intelligent and thinking assertively about how do they acquire users at scale globally at good rates, they want to try to find and eke out those wins across so many other, so many
Tye DeGrange (29:02)
inventory sources and it sounds like this could could be just that. You have to be looking for those new things because if people are not used to seeing an ad or a gift or an offer as you referenced like
Tye DeGrange (29:19)
That's your bottom dollar. That's what's going to probably work pretty well. They are the opposite of fatigued and seeing the banners all over the inter webs. are, Whoa, okay. I was expecting confetti and I just got a free month of Apple music. What the heck? I'll give it a shot. And it's like, that's an exciting moment for someone in, you know, to think affiliate, to think growth, to think like new inventory. Like that's the, that's literally what that ascending curve
Tye DeGrange (29:48)
you have to be looking for. So that's super interesting and I commend you for that.
Michael (29:53)
100 % with that. That's how we think about it. If you were one of the first advertisers on TikTok, amazing performance, right? If you were one of the first advertisers on that,
Tye DeGrange (29:58)
Yeah.
Michael (30:00)
if you were one of the first people buying ads on Google, you were getting great performance with influencers. If you were one of the first people who was going to Kim Kardashian and saying, let's do a collaboration, before any brands were, you were getting amazing pay off. Now all of those
Tye DeGrange (30:14)
That's
Michael (30:15)
channels, there's just, they're saturated, right? Right.
Tye DeGrange (30:16)
Yep. Fatigue or maturity or saturation, all of
Tye DeGrange (30:20)
the above maybe. Yeah.
Michael (30:21)
Yeah,
Michael (30:21)
so we're discovering this new inventory where, you know, when I'm trying to lose weight and I'm using a weight loss app, I do feel connected to the app I'm using. It's helping me achieve my goals. If I'm six days in and I've made a lot of progress and sacrifice, I feel good about this app. I trust this app. It's helped me through. If it's saying, hey, you know, we have another thing that could help, some exercise classes you could do with ClassPass.
Michael (30:49)
That feels right. It feels right that this app I already trust is helping me along my
Tye DeGrange (30:53)
Totally.
Michael (30:53)
journey. The same way in the early days of influencers, people had that trust in influencers and it
Tye DeGrange (30:58)
This is.
Michael (30:59)
felt right when influencers recommended something that helped their audience.
Tye DeGrange (31:02)
I love it.
Tye DeGrange (31:03)
I love this. This is like so core to me because I think so much of what I'm observing and we're all living through is this. We're in this extreme area of lack of trust and in so
Michael (31:15)
Yes.
Tye DeGrange (31:15)
many areas. And if you can in business and marketing, if you can capture that through that trusted third party, as we talked about when we kind of prepared, right? You get to be that if you're a fan of this app.
Tye DeGrange (31:30)
there's I think there's a possible affinity and there's a there's moments there where hey I trust this app to like look out for me for lack of a better term obviously it's going to take some some things to ensure that's there and in their own distrust but through third parties is the is the way and so if someone's saying hey this is a good thing you should try this I'm super fascinated by that and I commend you again for
Tye DeGrange (31:56)
for tapping into the thing that we're very much wanting to tap into right now.
Michael (32:01)
Yeah, it's like, are those moments of trust that are still remaining? Right? There's not, there's not a lot. so
Tye DeGrange (32:05)
Yeah. Yep.
Michael (32:07)
this is one, and it sounds kind of silly, but you know, if you're calorie tracking with an app for seven days, you kind of feel an affinity with this app. You're using it every day. Guiding you in
Tye DeGrange (32:16)
Yeah. Yeah.
Michael (32:17)
the right direction.
Tye DeGrange (32:18)
It's working. That's amazing. Michael, it's been awesome, man. You're, onto something. I'm super excited to have you on and just take us through all of these things. I'd love to just kind of come down the home stretch with some semi rapid fire and personal questions to get to know you a bit and finish it up. what, give us a, give us your AI tool de jour. Is there something that maybe is like off the beaten path or
Tye DeGrange (32:43)
Tooling or tech or AI that you're just like really obsessed with or really enjoying using that might be helpful for the audience
Michael (32:51)
One thing I found pretty interesting is I do a lot of writing because I write to CEOs, know, hey, this is why you should use our product. What I found AI useful for is saying, hey, you know, how would Toni Morrison write this or how would Donald Draper from Mad Men write this?
Tye DeGrange (33:11)
Yeah.
Michael (33:12)
just using it as
Tye DeGrange (33:15)
I love that.
Michael (33:15)
inspiration or I said like, okay, what would...
Tye DeGrange (33:18)
It's the
Tye DeGrange (33:19)
thespian in you.
Michael (33:20)
Yeah, what would George Saunders think of this outreach email?
Michael (33:23)
And so I use it for inspiration in writing. feel if know, AI alone isn't a very good writer and everyone is bombarded with these out bounds that feel very AI. So I try
Tye DeGrange (33:34)
Yeah.
Michael (33:34)
to, you know, make my writing feel very real. But I like the opportunity that AI has to experiment with different styles and try out different styles and ask it, you know, for feedback from different perspectives. And I think people do
Michael (33:50)
you know, when you're running a B2B SaaS company, there's so much focus on efficiency. So it's like, how do I reach more people? How do I automate a bunch of things? I think because everyone's bombarded with emails, LinkedIn's, cold calls, quality actually really matters, especially when if you get quality, right, it's actually easier than ever to scale that, right? It's easy. It's easy
Tye DeGrange (34:12)
Yeah.
Michael (34:13)
if you have the perfect message to get it in front of lots of people using agents. So I spend a lot of time
Michael (34:20)
playing with messaging and drafting and using AI to kind of help me assess if I'm on the right direction there.
Tye DeGrange (34:29)
that is there a book or resource or episode of some, you know, resource out there that you would recommend to other founders or those kind of going through, you know, trying to build something.
Michael (34:42)
Yeah, you know, I worked for Clay Christensen, the Harvard Business School professor. And Innovators Dilemma was a book that really excited me as a kid. The reason I think it's interesting now is because I see so many founders going after things that are extremely competitive and that they have no real right to win in. So and maybe somebody starts to work or maybe people do have an edge. don't.
Michael (35:09)
But if I'm like, okay, AI for marketing, right? Like there's 100 other startups that are saying, hey, plug in your meta ads. I'll give you some feedback on your marketing. I'll help you come up with better ads. Yeah. If you were kind of head of marketing at Amazon and like know all the other heads of marketing and like have the best AI scientists on your team and raise the most money, you could be the one that wins there. But I see a lot of people playing around with agents being like, I connected my
Michael (35:38)
Claude by marketing, I figured out some rules that make it better. have a company. you know, going back to innovators dilemma, he would argue, he would argue not because what the way he taught me to look at companies is what is the arc of how this is going to play out over the next 10 years? Right. So yeah, you have some, some rules you found that make your marketing better using Claude. Is that going to sustain, let's say that's a real game changer and is winning you sales and you're getting Fortune 500 companies to come to you because you have these rules.
Michael (36:09)
is no one else going to be able to apply these rules in their cloud who has better distribution or better ability to innovate, or better access to data? Probably not. Right. So you're kind of heading into this just sea of competition where you have no, no right to win. And again, if you're able to raise the most, or you have a huge following, or you have an insane network of CMOs you can sell into, maybe you can win that way. But he taught me to sort of focus on things that other people aren't.
Michael (36:39)
focused on. Invincible is all about the big guys don't want to play here. Right. So with Apple computer, wasn't that IBM didn't know about personal computers. The CEO of IBM met with Steve Jobs and laughed in his face. Like, are you kidding me? Everyone's going to buy their own computer. These things don't do anything. They're just these command lines. There's like 10 coders in the world. No one is ever going to sit around with a little personal computer like Wozniak is.
Michael (37:09)
That's ridiculous. so going after ideas where the bigger players are actually don't believe in it at all. That's a really fertile ground if you have conviction to pursue something. And I think a lot of founders right now are heading right into a lot of competition because for some reason, this AI boom has caused everyone to have the same ideas. What if we did AI for outbound sales? What if we did AI for marketing? What if we did AI for SEO?
Michael (37:36)
It's like you hear the same ideas over and over again. And
Tye DeGrange (37:39)
Yeah.
Michael (37:40)
it's something about AI that's made us all kind of have this group thing. I would search for ideas that the big players just don't believe are right or possible or exciting.
Tye DeGrange (37:51)
Yeah, it's I love that is that it was a brilliant way to wrap up and finish strong and what a great answer. And I think your direct experience and having access to one of the best in the business ever is an amazing one and is a beautiful book recommendation. It's I've gotten pieces of it, but now I definitely need to need to read it in full. And it reminds me of the strategy piece. It's it's hit me a lot over the weekend. I was reading some strategy, you know, strategy stuff and
Tye DeGrange (38:22)
I've read a lot of good books on it and I find it's interesting always to see like where people struggle defining it or confusing it with tactics. But it reminded me of just the limited resources that you have is like is a big is a huge factor in determining like, what are you saying no to? And what do you what are you really honing it down to? And I think that kind of echoes what you shared about. You can't do it all and you can't chase. You can't run and run to where everyone's running. You have to think very thoughtfully about.
Tye DeGrange (38:50)
You know, something unique, which, I think I commend you again for, for doing it in a way that's, you know, the Airbnb for, for app monetization perhaps, or some,
Michael (38:59)
you
Tye DeGrange (38:59)
some, some degree of it. So.
Michael (39:01)
Yeah, I really do believe if I had an hour with Sam Almond and I said, Sam, I got this great idea. You take this unused app inventory, these streak moments where they're throwing confetti and you use affiliate offers to make it a gift. Sam would not be excited about this idea at all. Because
Tye DeGrange (39:18)
No, no.
Michael (39:20)
it just doesn't fit with kind of the talk of where everything's headed. And I think that's a great thing.
Tye DeGrange (39:25)
That's why
Tye DeGrange (39:27)
I compliment you for it.
Michael (39:28)
Hahaha
Tye DeGrange (39:30)
But Michael, this has been great. I am looking forward to seeing you in the Bay. I'm looking forward to more conversations. I'm looking forward to following and getting our brands plugged in with you. And for those who want to learn more, where can they connect? What's the best way to get started and chat with you?
Michael (39:45)
Yeah, EncoreKit.com. E-N-C-O-R-E-K-I-T.com. And yeah, you can book a meeting right on there. Happy to chat with you. And like I said, these screens are making you zero dollars, these confetti screens. Just try it out for a week. See how much money you can make. You know, it's going to be more than zero. If you don't like it for whatever reason after a week, just shut it off. You got to try stuff with monetization. You know, like I just really hope that. Yeah, always be tested.
Tye DeGrange (40:09)
Boom. Always be testing, baby. Let's go. Thank
Tye DeGrange (40:15)
you, Michael. Appreciate you, man, and have a great rest of your day. See you, everybody.
Michael (40:18)
Okay, thanks so much,
Michael (40:19)
Have a great one.