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The last time I talked to Nathan, his web app (ConvertKit) had just hit $5,000 in MRR. In this two part series, Nathan describes how they grew that to $182,000 in monthly recurring revenue.
Show Notes
The last time I talked to Nathan, his web app (ConvertKit) had just hit $5,000 in MRR. In this two part series, Nathan describes how they grew that to $182,000 in monthly recurring revenue.
I’m going to start more conference talks with: “Look, this worked for me. If you can get something from it great. But there’s no guarantees.” I’m not interested in being a thought leader anymore.
Show notes
- Nathan Barry on Twitter
- ConvertKit’s public revenue stats
- Justin’s other podcast: MegaMaker – making 100 things in 1 year
Sponsor
My friend Peldi (from Balsamiq) is sponsoring a whole month of MegaMaker podcasts. He’s offering my listeners $10 off Balsamiq Mockups 3 for Desktop (normally $89). USE COUPON CODE MEGAMAKER. Expires May 1st.
Note from Justin
This interview is a smaller segment of a full-interview with Nathan Barry, available on Product People Club. Go to productpeople.club, and sign up for the waiting list. Screenshots are up now!
Want to help the show? If you could go to iTunes leave a nice review that would be superb. Also: if you’re listening on Stitcher, please leave a review on there!
Music: Lethal Force by Striker, visit them at striker-metal.com
Creators and Guests
What is Product People?
A podcast focused on great products and the people who make them
Hey. How's it going? Justin Jackson here, and it has become a tradition for me to release new episodes of Product People leading up to MicroConf in Las Vegas. This is a conference run by, Rob Walling and Mike Taber, and it's just for independent software entrepreneurs. It's a great conference.
Speaker 1:I look forward to going every year, and this is a great time to release this conversation I had with Nathan Barry. Nathan doubled down on his software project called ConvertKit. And in about a year, took it from $1,300 a month to about a million dollars in annual recurring revenue. But him and his team didn't stop there. They went on to double that number, and we get into that in this episode, part one of my conversation with Nathan.
Speaker 1:And before we get into that, just a reminder, I'm doing another podcast called Mega Maker, megamaker.co. And the idea is I'm trying to make a 100 things in one year. The shows are really short, between ten and fifteen minutes long, and people have been really digging it. My friend Pelty from Balsamic Mockups just let me know he'd listened to all of them over the spring break while he was out on his jog. He actually became a sponsor for this month.
Speaker 1:The deal's so good, I thought I'd share it with you too. If you go to balsamiq.com, that's balsamiq, and use the code Megamaker, you get $10 off mock ups, three for desktop. This is what I use for all my wireframing for websites, mobile apps, and web apps. You gotta go check this out. Balsamic.com, coupon code mega maker, and you get $10 off.
Speaker 1:It's a great deal. Alright. Now let's get into this conversation with Nathan. So first of all, I should say congratulations.
Speaker 2:Thank you.
Speaker 1:Because I have worked for and consulted three or four SaaS companies now, and most of them spend years and years and years getting to $1,000,000 in revenue, annual revenue. And you did that in was that three months ago?
Speaker 2:Yeah. That was in December 2015. So yeah. Like, ninety five days ago, we hit it.
Speaker 1:And how long did it take to get from when you went full time on ConvertKit, how long did it take to get to $1,000,000 in annual recurring revenue?
Speaker 2:Yeah. That would have been thirteen months.
Speaker 1:Thirteen months?
Speaker 2:Or or four fourteen months.
Speaker 1:Fourteen Yeah.
Speaker 2:Though I I like to remind people that I started three years. You know? It it it took three years. Yeah. Everyone likes to focus on an overnight success of some kind, and I always like to remind people of the years prior.
Speaker 1:Sure. Sure. The years in the desert.
Speaker 2:Yes. Exactly. And But a full time focused effort, you know, fourteen months or so.
Speaker 1:And, actually, while you're we're talking we've talked about it before, but some people might be hearing this for the first time. What happened in those three years in the desert? Why, you know, why were you struggling those three years to kinda gain traction?
Speaker 2:Yeah. So the first six months were really focused, great effort. I was trying to get to $5 in recurring revenue within six months. That was from a lot of people start counting from the day they launch. I start counting from the day I start working on it.
Speaker 2:Yeah. And, you know, we had made some good progress after 2,200 a month in revenue, which was good. But then, if you have other channels to bring in money, first of all, recurring revenue is the hardest thing in the world to sell. Yeah. Oh man, is it wonderful once you get it going?
Speaker 2:But I had no idea how hard it was to get going. And then I also just, I had this other blog and book and training business where I did courses and all that. And I think for every dollar that I made from ConvertKit with the same amount of effort, could make like 50 or a $100 on the book and training side. And so I honestly just didn't work on ConvertKit that much. It was like ten hours a week.
Speaker 2:And then by the time it was at its lowest, was October 2014, we're down to $1,300 a month in revenue. I was working on it like four hours, five hours a week, and you just can't build a business like that. Everyone wants to build side projects and, man, you just you just can't. It it didn't work for you. Something that scale.
Speaker 2:Yeah.
Speaker 1:Okay. And so then you decided to double down on ConvertKit, which was a big gamble because you were really leaving a bunch of money on the table. You had this big machine going. It's also interesting to compare you and our friend Brennan because he took the opposite strategy, and it's worked out great for him too. Yeah.
Speaker 1:But you decided to double down on the SaaS business. What took you from let's say, were around $2 Yeah. $2 a month?
Speaker 2:1,300.
Speaker 1:1,300. What took you from that to $1,000,000
Speaker 2:in annual revenue? It was direct sales. So instead of like, I'm a huge fan of content marketing. Mhmm. It's how I you know, I built a email list of almost 40,000 people, and that's how I've, you know, made the majority of my money selling books and courses.
Speaker 2:And that's what I was trying to do for selling ConvertKit. The problem was is I was being rejected, like, 50 times a day and I didn't know it. And that's the thing is when you're selling to content marketing, you know, you're it's a it's a lot of education and there's a pitch, you know, on your sales page or at the end of the blog post or something. And people are reading through it like, man. Great blog post.
Speaker 2:They And might write a comment or something, but they're still rejecting you because they didn't sign up for the product. Yeah. But they're not telling you why. Yeah. Because there's no conversation there.
Speaker 2:Whereas in direct sales, if I say, Justin, buy this thing. And you're like, yeah. That's cool, Nathan. Thanks for showing me about it. Yeah.
Speaker 2:And I could say, like, seriously, why aren't you gonna buy it? And you have, like at this point, you're socially obligated to give a reason that you're not giving me money. Yeah. And because you wanna help and all that, you will. And so with direct sales, I just started reaching out to people.
Speaker 2:I made a Trello board to track my sales process. We're we're a little more sophisticated now.
Speaker 1:You're more sophisticated in what way?
Speaker 2:Oh, we use an actual CRM called Base, and we have you know, we're reaching out to hundreds and hundreds of leads every week rather than, you know, just me like you know, what I really did is with the Trailer Board, I had to contact contacted, interested, very interested, and then signed up. And then over on the side, I had like a few columns for reasons that I was rejected basically. Yeah. And so I just said, okay, who could use ConvertKit? And I'd write down 20 names of people that I thought of or blogs that I came across who might need a new email marketing tool.
Speaker 2:And I just emailed them and say, hey, I see you're using Mailchimp. Is there anything frustrating you about it? And that got the ball rolling. And so, you know, the first month we closed like $300 in new accounts. And the next month it was like another $500 in new accounts.
Speaker 2:And and that that method really got us to about 10 say $15,000 a month in revenue by the July. So from October to July. And when you say us, at some point in here, you started hiring people. Yeah. Immediately.
Speaker 2:As soon as I made the decision to double down, I invested $50 into the product. I hired a someone to run customer support and then a lead developer to run all of the development. So rather than outsourcing like I was before, I Okay. Brought it on.
Speaker 1:So when you when you say hired, you mean real people on payroll, you're paying benefits, you're doing all that stuff.
Speaker 2:We didn't we didn't have benefits early on. But, yeah, payroll, you know, we're paying all the taxes and everything like that. And then my lead developer has equity. And so I couldn't. He had just come out of Y Combinator with another startup and a very, very talented sharp guy and I couldn't match his current salary.
Speaker 2:So we did a mix of equity and salary. So basically what he needed to live on plus equity.
Speaker 1:Yeah. Just as a side note, why would he wanna work for you?
Speaker 2:We have a long history going back. We've worked together at a few different companies. I basically made a list of when I made this decision to double down, I made a list of all all the developers that I wanna work with and ordered them, you know, top to bottom.
Speaker 1:Gotcha. You had a Trello board for this too.
Speaker 2:I did. No. Actually, it's a Google Doc if we're gonna get precise. But, you know, and I just went down the list. I started at the top and start like, everyone had something else going on, of course.
Speaker 2:But I Mhmm. Started recruiting, and I said, alright. If we're gonna build a real company, who do I want to lead the development for it? Yeah. And, you know, the first guy on the list was like, no.
Speaker 2:I've got a good thing going on. Second guy was like, I don't know. We'll see. Yeah. And we kinda went down.
Speaker 2:But then David, the number one guy on the list, came back like two weeks later and he's like, actually, things are kinda changing with the current company I'm with, so let's talk.
Speaker 1:Interesting. Know? Yeah. I I don't wanna I don't wanna keep burying the lead here because we're gonna get to this 2,000,000 in revenue a year. But while we're talking about it, I I wonder if there was a point where you said so for me, I at this point in my life, I don't wanna start a real company, if that makes sense.
Speaker 1:So I don't want employees. I don't and even like SaaS, there's part of SaaS that I don't wanna deal with. I don't wanna deal with servers. I don't wanna deal with DOS attacks. I don't wanna deal with, you know, all this stuff that comes with that.
Speaker 1:It feels like a big bundle of stuff. Right? So was there a point where you said, you know what? I'm ready to start a real company. Like, was that part of your thinking?
Speaker 1:It's like, this is me getting serious about being a businessman.
Speaker 2:Yeah. So when I started ConvertKit three years ago, I was looking for the next challenge. Because I felt like I kind of mastered the solopreneur thing of making a good amount of money. You know, the vast majority of it was profit. And I could see a clear path of taking that from say $250,000 a year in revenue to 500,000 a year.
Speaker 2:But the people I saw going beyond that with information products and that kind of thing, I didn't like their business models at like a million dollars a year and beyond. And so I was looking for the next challenge. Now so that's part of what I the reason that I started ConvertKit as a SaaS application. Mhmm. I didn't you know, I obviously didn't achieve that in the first eighteen months, almost two years.
Speaker 2:And so I had a moment of at that point of reevaluating. Like, okay, this hasn't worked. So I I asked myself two questions. And the first one was, do I still want this? Do I still wanna be the CEO of a SaaS company
Speaker 1:Mhmm.
Speaker 2:As much today as I did almost two years ago when I started? And the answer was, yeah, absolutely. And so then like the next question is then, what the hell? Like, why is this not working? And so the next question I asked was, have I given it every possible chance to succeed, like my best possible effort?
Speaker 2:If it's a side project, if you're putting in five hours a week, the answer is hell no, you haven't. That's the opposite of your best possible effort. I realized there was a disconnect between what I truly wanted and my actions.
Speaker 1:And so was the goal of a million dollars in revenue, was that your main goal? Is that what kind of motivated you to wanna move forward with ConvertKit?
Speaker 2:My initial numbers, like when I was talking to David, my lead developer, and and I've actually just a couple weeks ago made the change to officially make him a cofounder of the company. Our our initial numbers, you know, our dream was to get to 50,000 a month in revenue.
Speaker 1:Mhmm.
Speaker 2:You know, there's a we have a lot of peers in the bootstrapped software space and, you know, 30 k a month in revenue is is great for a SaaS app. You can you can have a nice life on that. Mhmm. And then I knew we could go beyond that, so I was hoping it to 50 and then eventually to say 100,000 a month in revenue.
Speaker 1:Mhmm. But what I'm trying to figure out is why. So why for you because we we we have friends that are fine with, you know, there's two guys working on a product. They're both making good money, and that's okay. They don't wanna grow beyond that.
Speaker 1:I I was just talking to Pelti, and he was sharing this the story of how he did not wanna grow at all. He just wanted to be one person, and he finally, know, acquiesced and hired one. So why for you did you wanna go beyond that? Why do you wanna go what's pushing you to go to a 100,000?
Speaker 2:Yeah. I like the challenge. If I'm not learning new things, I'm not interested anymore. And I kind of reached the end. I don't want to say this to sound arrogant or anything like that, but I can make $250,000 a year off my blog effectively on autopilot.
Speaker 2:You know, it takes time and all of that, but there's no new thoughts and no new techniques that go into it. I'd figured I'd I'd figured out a system for doing that reliably.
Speaker 1:Mhmm.
Speaker 2:And I can, you know, with limited effort, I can keep executing on that. But the money is not the interesting thing. It's the like, it's almost a way of keeping track of how much you've learned and how much you're growing. Mhmm. And then so there's that side of it.
Speaker 2:I wanted to keep pushing myself. And the other side is I like teams. I find solo work to get lonely. Mhmm. And I also like to be able to leverage other people's skill sets.
Speaker 2:I wanna take on bigger things and I don't wanna do it by myself. I want a team of people to do it. And, you know, I I just like the I like providing a great work environment for other people and all that stuff. Reading the articles of companies like WildBit and Basecamp and all these others, as they're putting a lot of effort into a great company culture and they're learning how to lead a company and all of that, that excites me. So I have another friend, Josh Kaufman, who has like in another way totally mastered the self publishing world.
Speaker 2:He's the author of self publishing and traditional publishing. Yeah. Author of the personal MBA in the first twenty hours. And he's in the same place. He wants no employees and all that.
Speaker 2:And he has created this amazing business to follow his methods exactly. And I looked at that and was like, I respect that, but I actually want a team.
Speaker 1:Yeah. It kind of goes to show how I've been thinking about advice a lot and how individualized each of our paths are. Like, the path you are on is only really makes sense for you. Obviously, there's things that we're hoping to to garner from that journey, but really, like, it it's interesting because you we've given a bunch of examples and almost every path is different, isn't it?
Speaker 2:Yeah. And I think I'm gonna start more, like, conference talks and that sort of thing by just saying, like, look, this worked for me. If you can take something from it, great. But it's not like this is the prescription of this is how to build a SaaS company or this is how to build a great independent business or anything. It's just like, maybe it's almost less arrogant if you're just like, hey, I'm just gonna tell the story.
Speaker 2:This is what worked for us. I'll put in any detail you wanna know. Yeah. Do you know? They're like, take what you want from it.
Speaker 2:But I'm not like, and I and I think this has changed for me in the last two years.
Speaker 1:Oh, interesting.
Speaker 2:I'm not teaching this is the way to do it. So, like, I'm less opinionated. And I'm less interested in being like a Internet famous personality Mhmm. I guess.
Speaker 1:Did that why did that change?
Speaker 2:I I see, like, a lot of the commentary on little things of when some company does this or gets some other valuation or sells or any of these other things, new products coming out, I see it as very temporary. I'm not sure exactly why I changed, but I no longer have the desire to comment on it and to be the first one to get an article out about any of that or really to be as much of a thought leader. I I'm more I wanna build my company and my team and and I wanna enable, you know, thousands of people to reach their own audiences through our software. Yeah. But, yeah, I'm I'm not in the same position of like, you know, if somebody I used to feel this decently often.
Speaker 2:Someone would write about pricing strategies or something like that. Yeah. And they might take images or graphics that I've written in one of my long articles and use that and not cite me. That used to really bother me. Yeah.
Speaker 2:And now I'm like, I don't even care. Like, just get the ideas out to whoever happens to need them. Yeah. I don't care if I get credit. I had learned it from someone else anyway.
Speaker 2:And so I don't know. I just don't care about that game anymore.
Speaker 1:Yeah. And okay. Let's let's get back to ConvertKit, because this is actually really interesting, but I think this thread will be kind of interwoven throughout everything here. So you built it to $1,000,000. One thing we haven't talked about is who's the customer for ConvertKit?
Speaker 2:Yeah. So it's professional bloggers. So we do email marketing for professional bloggers.
Speaker 1:So the irony is that you're targeting people that wanna be thought leaders.
Speaker 2:Yep. Absolutely. And I might come back to that world eventually. Yeah. And I still write my own blog, you know, but now it's once a month or so.
Speaker 2:Yeah. So why did you
Speaker 1:land why did you land on professional bloggers? And and so give us some examples. What are some high profile or just some folks people would have heard of that are using ConvertKit?
Speaker 2:Yeah. So a range would be Pat Flynn from smartpassiveincome.com. He's got a really popular podcast and blog. Another one in a totally different space would be a site called wellnessmama.com.
Speaker 1:Okay.
Speaker 2:They are an insanely popular family and life and wellness blog. And then we have blogs from people who make tiny houses to We've got Leo Babata who runs some of his popular habits blog on the web at zenhabits.net. So that whole range, someone who has built a great audience and they're teaching their audience every day and they're able to make a living from that. A lot of great authors as well. So that's kind of the professional bloggers.
Speaker 2:How we got to that point was originally we're doing email marketing for whoever happens to be frustrated with these particular things in Mailchimp. Yeah. Yeah. Turns out that's not an effective marketing strategy. Yeah.
Speaker 2:So then I was trying to think, okay, who are people like me who are making a good living online, they have an audience, they're selling products, and they're likely to have the same problems. Yep. Then I went to email marketing for authors cause I described myself as an author. Mhmm. Turns out, most people who describe themselves as authors, their dream is to one day self publish a Kindle novel for 99¢.
Speaker 2:Yeah. And they're not a good customer. Yeah. So we had to get away from well, I learned. When we did email marketing for authors, we got a bunch of terrible customers who would churn out after a month.
Speaker 2:But we also got a lot of help and support from people with well established blogs and communities who said, oh, that's exactly for my audience. Let me promote it. And I'm like, yeah, we don't have an affiliate program. They're like, I don't even care. It looks like a great fit for my audience.
Speaker 2:I'm gonna help you out and promote it. And so the targeting worked. It was just the wrong targeting. Yeah. So then we tried email marketing for course creators and just trying to narrow in on that.
Speaker 2:Then professional bloggers is what we settled on. And it's not perfect. We have a lot of customers that aren't professional bloggers. We have a lot of SaaS companies and startups and podcasters and everybody else. But it gets to the core message.
Speaker 2:It also is a little bit aspirational with the professional in there. So we get a lot of people who are saying like, all right, I'm signing up, I'm just getting started, but I'm taking this seriously. So I'm gonna go with ConvertKit instead of Mailchimp's free plan because this is the tool that, you know, will take me all the way through.
Speaker 1:Interesting. So part of the the job to be done there is that they're saying, I'm hiring this product because it signifies something emotional for
Speaker 2:me. Mhmm. Yep. Absolutely.
Speaker 1:Now the you know, when we we hear big names like Pat Flynn, how much of your revenue is folks like that, and how much of it is just people we haven't heard of?
Speaker 2:Yeah. So about three quarters of all of our accounts are on the 1,000 subscriber plan for $29 a month. Our biggest account pays us or contributes 1.5% of our revenue, and that's a $2,500 a month account. And so we have
Speaker 1:The biggest account is 25% of your revenue?
Speaker 2:No. $2,500 a month. Oh, okay. Which is like it changes every day, of course, but, like, 1.5, 1.6% of our revenue.
Speaker 1:Gotcha.
Speaker 2:So we're not reliant on anyone. You know, if we lose a big customer, it would obviously really suck, but it's not like we're heavily dependent on that. Yeah. We have a lot of great people in the middle who have, you know, 5,000, 10,000, 50,000 subscribers. Okay.
Speaker 1:And and and were you literally doing sales with all of them? Like, everyone was going into your Trello sheet? Like, you would meet, you know, some blogger, and and you would put them in your Trello sheet and bring them through? Or was that so really?
Speaker 2:Yeah. Like every single one. I mean, nobody we get occasionally, people would sign up organically. We get back in October, maybe one account a day would sign up organically.
Speaker 1:Okay.
Speaker 2:And so I would do the the outreach. And it didn't matter whether you had 500 subscribers or or 5,000. I would reach out and close that deal. And everyone was like, dude, that that doesn't scale. Yeah.
Speaker 2:You know, it's not gonna work. And especially to make it worse. To the end of the sales process, you're trying to convince someone to switch email marketing providers, they could love the product. They're like, okay, ConvertKit sounds great. The tagging, all this stuff, the automation, I love it.
Speaker 2:Man, I don't wanna switch. Yeah. It's so much work to switch. I'm just like, sorry, I'm just not gonna do it. Yeah.
Speaker 2:And so we rolled out something we called Concierge Migrations, where we do the entire switch for you for free. Initially, we did that for everybody. Not only would I hunt down a $29 a month account and convince them to switch over two Skype calls, but then I would switch over all of their forms, autoresponders, and everything. Export, import the subscribers room after tagging. So it was terribly unprofitable.
Speaker 2:But How
Speaker 1:many people did you do that with? You two Skype calls, concierge onboarding. How many people?
Speaker 2:At least 75. Wow. And now we've done it with so many more. We do it. Now now we have a team that handles migrations and a team that handles sales.
Speaker 2:And, but, you know, I just I had a call this morning with a blogger friend who's switching over. He used to run one the most popular personal finance blogs on the web and then sold it. Now he's starting a new site. And so caught up with him for half an hour and then I was like, Hey, send over your login info. And you know, I have a little calendar meeting with myself scheduled for a little later to go switch him over.
Speaker 2:Wow. And most of the time, I don't do that these days, but, you know, it's only gonna take me an hour and I like the guys.
Speaker 1:And the was there ever a tipping point? I was talking about this with Paul Jarvis and Jared Drysdale. And because we were talking about just email providers. And it almost seemed like there was a tipping point where we just all of sudden heard of a lot more people going to ConvertKit. And I'm wondering, was there once you hit a certain mass, like, there's enough people on it, did you set did you sense that people more were more willing to switch?
Speaker 1:Like, all of a sudden, they're in a kind of not a peer pressure kind of way, but a social there's a Social proof. Yeah. A little social well, social proof, but social dynamic there where people are like, okay. Well, everybody's there. Maybe I should go there.
Speaker 2:Yeah. Yeah. Absolutely. That happened around July. Right?
Speaker 2:We're at about $15,000 a month in revenue. And that I started to be able to name drop bigger and bigger names. Yeah. So when I would when I would reach out, just super short email. But I just say, hey, anything frustrating you with Mailchimp?
Speaker 2:The reason I asked is I run ConvertKit. It's an email marketing platform for professional bloggers used by x y and z. Once I got to name drop Leo Babata from Zen Habits
Speaker 1:Yeah.
Speaker 2:Who you know, anyone who's been around the blogging world for a long time, it's like, oh, yeah. I remember when Leo's site was named, you know, like one of Time Magazine's 25 websites that makes the Internet great.
Speaker 1:Like Yeah.
Speaker 2:You know, newer people haven't heard of him as much, but anyone who's been around a while has. And so stuff like that, that started to get basically what I learned and what made me willing to do all the work for direct sales is that every sale I made made the next one the tiniest bit easier. And early on, like, it was really tiny the amount that it was easier. Yeah. Once we closed our first account that had a 100,000 subscribers, then all of a sudden, every person who had 10,000 subscribers who was saying like, Man, I don't know.
Speaker 2:I'm kind of a big deal. I don't know if ConvertKit can handle me. I'd say like, Well, look, Joel just switched over a 100,000 subscribers and he likes us. So I think we can take care of you. Yeah.
Speaker 2:So that got easier and easier. Pat Flynn switched over in July and then in late August, we were allowed to start talking about it. Why
Speaker 1:did Pat switch over?
Speaker 2:He was on Infusionsoft and he was really frustrated with the complexity of it and always having to hire out all the functionality or hire people to do it. He wrote a 5,000 word blog post on why he switched so you can Google that. Yeah. So it was that. I worked pretty hard on the direct sales side of things.
Speaker 2:I flew to San Diego to meet with that. Wow. You know, and I like most people just aren't willing to do a lot of the direct sales things. Yeah. Like a couple times, I got on a plane and went to I did one trip where I went New York, Nashville, San Diego back home.
Speaker 2:And then another you know, a month later, I flew out to Nashville again to meet with a few more people.
Speaker 1:Wow. And was that primarily you were just thinking once I get those names, there'll be enough social proof that I can was that your thinking, or what was the thinking?
Speaker 2:Yeah. That was definitely a factor. I was trying to build up our affiliate program as well, And I was looking for advice and suggestions. I was trying to get Pat to be an affiliate. Actually, that was the main thing.
Speaker 2:And he had kind of tentatively agreed to that. And then like a month later, was like, Actually, I really hate Infusionsoft and I'd like to switch everything over. Wow. Then he ended up falling in love with it and put together this ridiculous promotion plan where he was like, Yeah, wanna have you on the podcast. I've got this demo video that's gonna come out on my little TV show.
Speaker 2:I wanna write this review. And he sent me the review, and I was like, Pat, do you wanna be an adviser? Yeah. Because this is some pretty epic promotion. Yeah.
Speaker 2:And so then we brought him on as an adviser as well.
Speaker 1:Does he get anything else though? Does he get affiliate sales? Like, was there any other incentive for him to switch?
Speaker 2:So he as an affiliate, he gets the same affiliate deal that everyone else does. It's the 30% recurring commission.
Speaker 1:Gotcha.
Speaker 2:And then, you know, he has a a little sliver of equity in the company as an adviser.
Speaker 1:Yeah. One thing I I was thinking about I was thinking about SaaS sales cycles and just how hard it is sometimes to sell SaaS. And obviously, you've put a lot of work into it. One one thing I was thinking about was you really have when you're talking to people, the person you're talking to also has the credit card. There's only one decision maker.
Speaker 2:That definitely helps.
Speaker 1:And I think it helps a lot. I I was thinking about how many software products have to go through a whole team of people and how much that slows down the process. And one of the advantages of the space you're in is in terms of starting a business is that there's you just have to talk to one person. That person is the guy with the credit card. Did did you did you plan that?
Speaker 1:Like, did you think, well, maybe we should go after teams or bigger things, or were you always like, no. This is a great place to be.
Speaker 2:No. So I think we have one of the best possible markets in the world and one of the best possible business models, and none of it was, like, through careful planning. So to elaborate a little bit more, what you're saying of, I just have to convince one person, that's huge. The downside is that if someone wants to cancel, they're not as locked in, but they're fairly locked in. Like it's work like we talked about, it's work to switch email providers.
Speaker 2:Yeah. The other thing well, I have to say, I got made fun of a lot in the software circles for the email marketing for professional bloggers. People are like, seriously, when are you gonna target real companies? When are you gonna target Mhmm. Software companies or small to medium businesses or you'll never build a business there.
Speaker 2:But the thing is bloggers are better at building email list than anyone else on the planet.
Speaker 1:Oh, man. I really hate to stop it there, cut this episode short, but the rest of the episode is coming in part two of this conversation. I also wanted us to really chew on what Nathan said there. He said, we have one of the best possible markets in the world, and one of the best possible business models. You know, there's a lot of focus right now on product and making the product great and product market fit.
Speaker 1:But there's this other dynamic to product market fit which is how easy is it to get someone to pay you for that product you've created? And what Nathan, he said he kinda accidentally stumbled on, was this idea of he only needs to convince one person to take out their credit card. But you might be building a product where you have to convince a whole team to do that. And so we get into that in the next episode. Stay subscribed.
Speaker 1:Stay tuned for that. I just also wanna thank again Balsamic for sponsoring my other show, megamaker.co. And if you go to balsamic.com and use the coupon code Megamaker, you get $10 off the desktop client version, which is the one I use. So go do that. You can get ahold of me on Twitter.
Speaker 1:I'm the letter m, letter I, Justin. Or go join my newsletter for product people, justinjackson. C a slash newsletter. I try to send a newsletter every Saturday, and it covers everything from tactics to the human side of building products. All the struggle and overcoming the struggle.
Speaker 1:Alright, this is fun. I'm glad I was able to put it on another episode, and like I said, stay tuned for a few more that if you're going to MicroConf, you'll be able to listen to on the plane, and maybe I'll see you there. Talk to you soon.