Show Notes
Transcript
[00:00] Mike: In this episode of Startups For the Rest of Us, Rob and I are going to be talking about why you shouldn’t worry about competitors. This is Startups For the Rest of Us episode 217.
[00:07] Music
[00:14] Mike: Welcome to Startups For the Rest of Us. The podcast helps developers, designers, and entrepreneurs be awesome at launching software products. Whether you built your first product or just thinking about it. I’m Mike.
[00:22] Rob: And I’m Rob.
[00:24] Mike: And we’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s the word this week, Rob?
[00:27] Rob: Well, I just wrapped up an AMA, ask me anything, on Bootstrappers.io. We’ll link it up in the show notes. But it was a lot more work than I thought it’d be but it was also pretty fun. I got questions from folks like Andrew Warner, Brian Castle. There was a lot of good stuff that came out of it and actually there were so many questions and I answered all of them, but there were a lot of the answers that I really want to flesh out, either into full-length blog posts or a full podcast episode because there’s just so much to say about certain topics.
[00:56] Mike: Very cool. So, what brought that on?
[00:58] Rob: I was emailed by the guy that writes Bootstrappers.io. He asked if I wanted to do it and I said as long as in the Bio you could include a mention of Drip. I’d never done one so I didn’t know how much work it would be or what the real impact of it would be. Turns out it was pretty cool. It was neat to see how many names of people that I recognized. Emailed us, asked questions through the podcast, that I met at MicroConf, run other podcasts. It was fun to just be involved and be doing something in public. I think I had actually mentioned in Founder Cafe, kind of my status update, I need to start doing more things in public again. Because aside from the podcast, I haven’t published a book in a long time. I haven’t been blogging nearly as much as I used to. I’ve really been heads-down, focusing on growing Drip.
[01:42] And while that’s what needs to be done right now to grow it, I want to do more things like this and just get back to the way it was. I mean, three or four years ago, I was publishing stuff every which way online all the time. I was just all over the place and I’ve since been focusing more on businesses. But I do really enjoy doing things out in public and it makes me happy to do that. I’m happier when I do it. So, I think part of 2015, that’s something I want to get back to.
[02:09] Mike: I don’t want to call it getting back to your roots, but getting back to the things that you started out doing and kind of the reasons why you started bootstrapping and kind of sharing this stories and experiences and stuff online. It’s just because it’s fun and it’s helpful for other people but most of all you just enjoy doing that.
[02:25] Rob: That’s right. Yeah, since it’s the week of Christmas, I have basically backed off on almost all of my advertising, even some of my re-targeting and there’s not a lot of action going on right now in the B to B space. So, I actually stopped publishing new blog posts on the Drip blog this week as well. I’m stockpiling some pretty good content, some ad ideas and even some videos that I’m going to be pushing live in early January. About email marketing and how to do it and all that stuff. So, just trying to get that all in line because aside from just having the content, there’s always the technical issues of how you’re going to upload it, how you’re going to present it, how you’re going to market it. And I’m trying to iron all that out and get things going, so. At this point it just feels like easing into the end of the year. Kind of how it goes every year. And then second week of January, really ramping things up.
[03:12] Mike: So, the only other thing I’ve kind of been paying attention to lately is the fact that we still don’t have a signed contract from MicroConf yet because everybody’s on vacation so we basically still have the dates as tentative, which kind of sucks.
[03:23] Rob: We’ve had the toughest time this year just getting a venue nailed down and getting a contract signed. It’s been crazy. I think this has been the worst year we’ve had.
[03:29] Mike: Yeah. I think even the first year was quicker. What was it, like the first year we went from zero to conference in what ten or twelve weeks or something like that?
[03:36] Rob: Yeah.
[03:37] Mike: Well, today’s episode is kind of inspired by Robin Warren and he wrote into us and he said, “Hi, guys. I’m responding to the request for episode ideas from the newly branded Founder’s Cafe. Every time I see some information on a competitor or even something that looks like a competitor to the app I’m developing it’s like being punched in the stomach. I know logically it’s a good thing and that it helps validate the market and now I need to work out how to compete with them. Maybe in time I’ll internalize that and my intuitive response won’t be to get deflated. To help with that it’d be cool to have an episode on competition and what to do when you discover competition or see them getting more press, or influence, or attention. Hopefully some sense talking from you guys can help bring the intuitive side of my brain into a bit closer to dealing with these events without wanting to give up.” I brought this up partly because it’s also a section I’m putting into my book which made doing the outline for this really easy this week.
[04:24] Rob: Yeah, and speaking of your book. If folks want to hear more about that they can head to Singlefounderhandbook.com.
[04:31] Mike: One of the things that have kind of come back to me and some of the customer development that I’ve been doing for the book is that people have been saying that they’re having a hard time dealing with competitors. And part of it was some of the things that Robin talked about. But a lot of the stuff has to do with things like bootstrappers tend to want to build stuff that nobody’s ever built before. Or they don’t want to be seen as if they’re copying from others, or, and I think that a lot of people have this issue, is that they don’t want to put their stuff out there because they’re afraid of other people copying their ideas. So, I wanted to talk a little bit about competition and why you shouldn’t necessarily worry too much about other people competing with you and you also shouldn’t worry too much about having to compete with other people. And I think that kind of laying some of these things out will help put people’s minds at ease.
[05:14] Rob: Yeah, I think there’s kind of a spectrum here, right? If you’re trying to build something on the side that’s really small and the market is tiny and maybe you only want to get a thousand or two thousand bucks a month and you’re kind of doing that first step of the stairstep process, then having a competitor that is way ahead of you and is executing well, it can be a real issue. So, I don’t think that competition is always a good thing especially in a smaller market like that. But assuming that’s not your initial goal or that’s not the goal that you’re trying to attack right now, then let’s talk about why bootstrappers seen to have a hard time with competitors.
[05:50] Mike: So, I think the first one is that they want to do things that nobody has ever done before. I think the downside to this is when you are trying to do something that nobody’s ever done before, you haven’t really proven out the business idea, yet. There’s no justification there that says, “Hey, there’s people who are willing to pay for this.” And I think that’s one of the downsides of trying to go into a market where there aren’t any competitors, and as I said, there’s this propensity for developers to say, “I want to green field project,” when in some cases that can actually be harder because there’s no justification there that anybody’s willing to pay for it, so you have to do that work yourself.
[06:24] Rob: Yeah, and I think there’s two sides of this. An example of doing something that no one has ever done before could be something like, coming up with some new B to C social network idea or it could be trying to build really, really good low priced software for accounting for the timber industry, right? If no one has ever done that before. And those, if there really is no other competition, it could be a real sign that either, A, the idea’s too risky, or that the market is not large enough. Now, examples of doing something no one has ever done before, that I think are better ideas or that actually have some viability, is if you said, “Okay, no one has ever done e-signatures on WordPress, so I’m going to combine those two.” Or, “no one has ever done an Eventbrite crossover with WordPress, so I’m going to build a WordPress plugin that essentially allows me to emulate Eventbrite.”
[07:13] There you’re just combining stuff, taking an idea that’s already worked and you’re moving it into a new eco-system. Into WordPress, a place where you know you can get leads and that there are channels of folks coming and looking for it. So, I think that’s a good differentiator. We’re not saying that you should never do stuff that no one has done before, but if someone has done something before and it hasn’t been delivered to a particular eco-system or you can put a spin on it but still keep it kind of B to B and true to it’s original form to where you can tap into a nice marketing channel, then it can actually be something that can work for you.
[07:45] Mike: You know, it can be more work because you have to justify the application’s existence or you may need to educate on why it is that they need it. And it’s not to say that’s impossible, it’s just that it can be a little bit more difficult. Whereas, if there are competitors there, it helps to kind of provide you that assurance that people are willing to pay for it.
[08:04] Rob: Yeah, I agree. And if you push into a brand new space and you can’t just come in and say, “All right, we make email marketing software and here’s how we’re different from the two or three incumbents that you know about.” If you can do that, you’re actually in a pretty good position. But if you come out and instead of being able to use a short phrase like email marketing software, or marketing automation software, or accounting software instead of being able to do one of those things and you have to say, “Well, we build software that helps you do this and that,” and every time someone asks you you find that you have to explain what it does rather than being able to just name a two or three word description that everybody knows, that’s where you’re really running uphill.
[08:42] Because people want to be able to link your product to something that they already know about and they want to be able to position it with something they already know about. And if they can’t do that then it is a real uphill battle, especially for a bootstrapper because it’s very expensive to educate people and to try to get them to understand what you’re building and why they should need it if they don’t already have that knowledge.
[09:03] Mike: So, the second problem is that developers don’t want to be seen as if they’re copying others. And this kind of goes back to the first one where people want to have green field ideas but they don’t want to be seen as if they’re completely ripping off and idea that somebody else had. And I don’t know whether that has to do with self-esteem because they want to say, “Oh, look how smart I am. I came up with this brand new idea that nobody else had ever done before,” and I’ll use time tracking software as an example. There’s only so many ways that you can track your time online using applications. But if you look around on the market, there’s like thirty different time tracking applications and that’s probably an understatement. They’re just everywhere. But in some way, shape, or form, they are all a clone of one another. So, the reality is that it doesn’t necessarily matter whether or not you’re doing that. It’s like are you doing it well and are you serving a market?
[09:50] But I think that’s a psychological barrier that people have is that they don’t want to be seen as if they’re cloning some other application out there. Which in my mind is actually very funny because if you look at something like Linux. It’s very widely used. It’s a clone of Unix. If you look at Apple’s OS X, it had it’s roots back in PSD. It’s not the same thing, obviously but that’s where it’s roots are. And those things naturally evolve over time. They’re not going to stay the same throughout their lifespan, so even if you’re using somebody else’s product or application or design as kind of a starting point, it’s not going to stay there. But I do think that this is one of the things that people have a hard time justifying to themselves and to others.
[10:29] Rob: Yeah. And, I think the bottom line is, especially at the scale that we’re all operating at, which is very, very small compared to the rest of the world, people just don’t really care unless you rip off marketing verbiage, or homepage headlines, or a feature by feature, or you really are stealing tactics, that’s when people start to care. But even then it’s typically only the competitor. If you’re stealing someone’s headline, they care, but no one else notices. Don’t rip off other people’s marketing, don’t rip off their feature by feature, but be less concerned in general about being seen as copying others, because frankly it doesn’t really matter that much. It’s so much about how well you’re going to execute and how you can out-market other people than it is about building a product that might be similar or close in positioning to another one.
[11:15] Mike: So, I think the third reason bootstrappers have a hard time with competitors is that they don’t want other people to steal their ideas from them. So, similar to them not wanting to take other people’s ideas, they don’t want other people taking their own ideas. And this is really just the reverse of what we just talked about. But the reality is as soon as you take your product and create a webpage for it and people can go sign up for it or download it, that can easily happen and people can go out there and take it to their heart’s content and do what they want with it. They can copy to UI. I mean there’s loads of GPL software out there that is almost a one hundred percent ripoff of various applications. As I said, it’s kind of humorous that you look at those things and that’s deemed okay, but as soon as an entrepreneur goes out and tries to make money off of something like that then it’s a big no-no. The reality is that once your product is out there, you are inevitably going to have other people copying from you and that’s not necessarily a bad thing because just because they’re copying your design doesn’t mean they’re copying all the underlining things that make your product special. And that’s really what you should be concentrating on is making your product special.
[12:15] Rob: Yeah, we’ve talked about this a lot in the past on this show, just about how you shouldn’t be afraid of talking about your ideas to people. Now, something I would not do is go publish on the open internet my entire marketing plan or something that I consider to be a real unique competitive advantage that I have. But to tell someone that I’m going to be building an email marketing app or I’m going to be building a time tracking app and even to give out some ideas of it, what’s it’s going to be or how it’s going to be different, there’s just so few people who can even execute on that well enough to be a competitor and those people tend to have their own good ideas or they have their own good things going on. They’re not going to sit around. The people that are going to sit around and take your idea and try to duplicate it tend to be the ones who want some sort of shortcut and aren’t going to follow through and don’t know UX well enough and who don’t know how to market well enough, they just aren’t really going to be that much of a competitor to you.
[13:07] Mike: So, I wanted to dig in a little bit and talk specifically about seven different reasons that having competitors doesn’t matter. And the first one is that established competitors help to justify the market. And as I said before, when you start looking at a market and you start building a product, when you find established competition and they are making ends meat by actually having a business that they’re making money from, then what that is is that’s a signal that you can use to say, “Hey, there are customers that this particular product is serving that are willing to pay for this particular product.” Now, that doesn’t necessarily translate to you being able to reach them or you being able to fully serve all the needs that they have, and it’s one of many that you have to take into account and it’s helpful to know upfront that people are willing to pay for that kind of solution as more of a data point than anything else.
[13:54] Rob: Yeah, the interesting thing is, especially if you have extremely large competitors who are doing tens of millions or hundreds of millions of dollars, they are almost always leaving behind some group of people. They’re not serving them very well. Because that’s how you grow large is by covering this horizontal space, and so if you take a mega time tracking app or a huge accounting system or an enormous email marketing system, I think we all have ideas of what each of those are, you’re always going to find people on forums, or Twitter, or just in your circle who are saying, “You know, they are not serving,” insert demographics here, “they are not serving startups very well.”
[14:33] You can use them for those purposes but there are all these verticals that you can dig into that you can serve better as a small micropreneur, solo entrepreneur, on getting started, and you’re right, the established competitor helps justify that market on a large scale. What will happen is, you can find a little niche under there that could be a couple grand a month or maybe it’s five or ten grand a month and you can sneak in under their radar and they won’t even notice it but it’s still a nice little business for you.
[14:59] Mike: So, number one deals more with established competitors but number two is specifically aimed at when you’re building a product and it’s kind of a new product and you find somebody else who’s also building the same product. It helps but it doesn’t absolutely justify that there is a market. So, if you’re building a time tracker that hooks into a very specific piece of software, maybe it hooks into OS X and it allows you to trigger it from a Macro, or something like that, if you look out there and you find somebody else doing that exact same thing but they are not far enough along that they’ve actually launched, I put this in the same bucket where as a data point but it doesn’t necessarily define the entire market.
[15:37] It doesn’t say that you’re going to be able to meet their needs and everything else. I think this is a little bit different than what you also just explained where you’ve got a large competitor where they’re leaving behind a big piece of the market where there would be space for somebody smaller to come in and take ten to fifteen thousand dollars a month. It’s a little bit different than that.
[15:54] Rob: Yeah. When I look at competition as a really small startup or solo entrepreneur I’m not scared of the large competition because as I said you can sneak in under their radar and take a much smaller piece of the market that’s still substantial for someone of our size. I am more concerned about new competitors, always, because they’re the ones that are agile. They’re the ones that are out there and hungry and doing it on the side like you are and they’re the ones that are going to be talking to probably overlapping customers or prospects that you are and you guys are going to be competing for business more than you and that giant behemoth email marketing company or whatever, time tracking, whatever it is you’re building.
[16:32] So, they definitely cause me more concern but I agree with you that, you know, it used to be that when I would see new competition enter a market, you always give them the benefit of the doubt. If they raised funding, you think, “Wow, they’re legitimate.” If they haven’t raised funding, you think, “Wow, they’re scrappy.” Almost always that’s an incorrect assumption. And that people out there launching things are just bound to fail. More often than not, the colleagues that I know who are in these markets and new competitors come in, we’ll look at them together and we’ll talk through them and almost every time that competitor winds up fizzling out within three to six months because they don’t know the UX, they don’t know how to market well enough, they don’t learn what their customers really need, and they often rely on a single feature. It’s funny, you said time tracking that integrates with Macros or whatever, that’s a great single feature to start off with and that’s a great headline to kind of get out there.
[17:21] Almost guarantee you that feature will be implemented by either larger competitors or other small competitors quickly and so you then have to figure out what’s next. If you don’t continue to evolve then you are going to lost market share and you’re going to lose it. And that’s what I see a lot of these fly by night competitors coming up doing. So, new competition as you said, it helps justify the market, it doesn’t absolutely guarantee there’s a market and while I have more concern about them than larger competitors, overall I found that they don’t tend to stick around in general.
[17:48] Mike: So, the third reason that having competitors doesn’t matter is that once having your product launched anyone can sign up for it an copy everything you have done anyway. Working in secret, we’ve talked about this before, in general is really just not helpful because the software isn’t what gets you customers, it’s the marketing engine behind it and it’s a lot more difficult to copy that than it is the product which is more or less public. There are ways to spy on your competition and see what ad words they’re going after or what keywords they’re targeting on their website for SEO and everything else, but the reality is their marketing engine or their marketing plan is probably a lot deeper than you have visibility to and the same thing with yours. Your marketing plan is not public knowledge for everybody to see. So, just because they can copy your product doesn’t mean that they can copy all of the associated things that go with it that are helping you to get in front of customers and help turn them into paying customers.
[18:40] Rob: Yeah. Some other things that are essentially competitive advantages that you build up as a snowball over time and are kind of moats that are hard to cross are things like a lot of link authority and so therefore, a good SEO juice and a high proportion or a high number of organic visitors every month coming to landing pages where you’re capturing email addresses. If you build up that engine, which has nothing to do with the product and can go unseen if people are not actually looking at what you’re doing, that is a flywheel in a half right there. And so, if you have a competitor who comes in late, even if they can take your whole product, they can’t catch up to that kind of thing.
[19:17] Another thing is knowledge of paid acquisition because you can honestly burn through thousands of dollars on a bunch of channels figuring out one channel that works and the demographics and the keywords that work for that. When you have that knowledge and your competitor doesn’t, that’s an advantage. Another one is your network. You can do joint ventures, you can get people to come and vouch for you, you can get people to do courses with you and webinars and all kinds of stuff. So, if you get out ahead of someone and you can use your network that’s another thing that’s really hard to compete with. But the product itself, in general, is relatively easy to replicate. There’s obviously are exceptions.
[19:55] Actually another thing is knowledge of your customers, and that’s one thing that I don’t want to leave out here, is that a lot of people launch products and then are selling to customers and they don’t understand who they are or why they’re buying and all that stuff. Once you have an in-depth knowledge of who your customers are and how to reach them and why they’re buying, which is all encompassed in that single term, marketing, you have a competitive advantage that a newbie coming on board, even with a half million dollars in funding, trying to launch a direct competitor to you, they will likely lose because you’re just so far ahead of them in terms of that knowledge.
[20:29] Mike: The fourth reason for why having competitors doesn’t matter is that in many cases it’s hard to imagine a scenario where there’s just one winner and everybody else loses. And if you look at major players out there. You’ve got Apple and Microsoft, you’ve got Oracle and SQL Server and kind of our space, you have much smaller companies but there are still several of them out there. You have companies like LaunchRock and Kickofflabs and Unbounce that are all kind of competing in basically the same space. And then another set. You’ve got FirstOfficer.io and HookFeed and Baremetrics and they’re all competing in the same space. And they’re all have viable products and they’re all making ends meet. So, the point is that it’s not a zero sum game where for you to win everyone else has to lose.
[21:07] There’s almost always room for more players. And I say almost with that little caveat, there are definitely places where there are not enough room, the much smaller areas where it’s really just not worth the time or effort to have multiple competitors in that space. If you’re looking to build any sort of serious business you have to examine the possibility of what happens if a competitor comes in here? And is there enough room for multiple people to play. That should be part of your consideration process.
[21:32] Rob: Yeah, that’s the important part again, right? If the market is tiny. If it’s a two-thousand dollar market then there probably aren’t room for competitors. But in any of the spaces that we’re talking about today, there tends to be room for another small competitor. And what typically happens is apps come out that is very similar to a competitor but they have one twist, they have one feature differentiation. Or maybe it’s a pricing structure, a business model differentiation. And customers who aren’t happy with that first incumbent, come and take a look at yours, and you’re going to find that some like your product and others don’t, but you’re going to find out why they like it and then you’re going to move more in that direction. The product is not stagnant and neither will your customer base be.
[22:11] You’re going to build more features for that group and you may find that you start a competitor, you know, a new landing page competitor to compete with LaunchRock, Kickofflabs, Unbounce, LeadPages and you try to differentiate in one way and all of a sudden it’s like e-commerce, providers are really using this and they like that one feature and so then you just go and you focus and you niche down on e-commerce. We’ve seen Nathan Barry do this on ConvertKit. He launched ConvertKit and the landing pages and kind of email marketing built in and he’s niched down because he’s found out that he had a lot of authors who were interested and so now if you go to his homepage the headline is email marketing for authors. And so he’s niched down. That wasn’t the original goal. Same thing happened with Drip.
[22:47] I launched it with the certain unique selling proposition and that has changed over time and I’ve entered the marketing automation space purely from customer requests. So, this stuff tends to shake itself out over time. If you get in there and you get some customers and you follow the lead and try to figure out what’s the most valuable thing for the largest group of customers that you have and you can move in that direction then you’re right there’s room for more players because you’re going to spread out anyway. You’re not all going to stay clustered in the middle of the market.
[23:14] Mike: And part of what you said in the beginning kind of leads on to number five which is that customers sometimes change products. There are times where you’re going to be able to accommodate the changes that they’re asking for but there’s times when those customers are not going to be willing to wait and those customers very well may look at the competition and decide that they’re going to switch. Just because somebody signs up for your competitor doesn’t mean that they’re not going to have a bad experience or some problem that that competitor can’t solve. That can be an opportunity for you to succeed in the long run.
[23:41] Just because somebody signs up for your product doesn’t mean that they’re not going to switch in the future. And this goes back to having enough room in that market for more than one player. The sixth reason is that different competitors can serve different market segments better. And this is generally according to their marketing. It tends to have very little to do with the product itself. It has to do with how they’re positioned in the market. So, for example, if you think about something like Constant Contact or MailChimp, you start thinking about the types of customers that are going to use those. And I think for MailChimp you kind of gravitate much more to thinking of them for bootstrap startups and much smaller companies. The reality is that they can scale up very very high and they can handle massive email lists. The same thing with Constant Contact. But Constant Contact has a, I’ll say a reputation, for working with brick and mortar businesses than anything else.
[24:29] It’s not to say that that’s true of exactly what they do but that’s a reputation that they’ve kind of established in a lot of the direct response marketing that they’ve done and working with people at a local level to handle all these different events that they’re doing where they’ll send somebody in and they’ll do an in person presentation. Invite a bunch of people in and show them how it works and what they can get out of it. It’s much more about how they’re addressing the market and how they’re presenting themselves to the market in terms of what they’re capable of delivering. And it’s about the perception of the customers. So, if you can position yourself differently then you also have an opportunity to compete against them by positioning yourself one way versus how the other company positions themselves.
[25:13] Rob: Yeah, and the way I think I want to enter this is if you are a single founder and you don’t have a lot of budget and you’re doing this on the side, I’ve always said, you want to enter a vertical first to try to serve that vertical as best you can. And then later, if you get enough momentum, spread out into the horizontal. If you ever get there. I mean if the vertical’s big enough you can stay there. I think if you have more horsepower, you have a little bit of funding or you have a couple developers who you’re working with, you have a larger team, then you can consider going into a space and being a little more horizontal, getting a lot of people using it, and then figuring out which is the most valuable. And then almost, kind of like I said, going the reverse direction of catering maybe just to authors like Nathan Barry’s doing or switching, specializing, going from just this broad email marketing into marketing automation which, I guess, not directly vertical, it is a subset of email marketing. So, you can attack it from two directions depending on the resources you have when you start.
[26:10] Mike: And the last reason that having competitors doesn’t necessarily matter is that your customers are the ones that should be driving your product road map, not your competitors. The fact of the matter is, your customers are going to be different than your competitors which means that you’re talking to them and your competitor is not. So, naturally what’s going to happen is that naturally over time your road map is going to naturally diverge from their road map because your listening to your customers. Presumably, they’re listening to their customers and if they’re following you it’s going to be very difficult for them to attract those types of people because if they’re not talking to their own customers and they’re just copying what your website says that your product does, it’s going to be an uphill road for them and they’re probably not going to last very long. But if they’re talking to their own customers and listening to what their customers have to say to them then chances are you guys are going to go in different directions. And if you do end up going in the same directions, then at least you were listening to your customers and those are the people who are driving your revenue anyway.
[27:02] Rob: Yeah, it’s pretty rare that I see two companies whose road maps are just lockstep for months or years at a time because when you are listening to customer feature requests and prospect, you know, lead feature request who are very serious about signing up and you’ve kind of validated that and they’re basically saying, “Yeah, can you do this one more thing and then I’ll sign up?” As you qualify them at that point, you’re just going to get different requests. You’re going to get feature requests. You’re going to decide to go in a slightly different direction than your competitors and I think that’s a good thing because it helps differentiate multiple products that are in the same space and while you are still competitors it will kind of broaden your differences over time.
[27:40] The only time I’ve seen competitors that are almost lockstep in terms of features, is when one competitor is basically watching the other competitor and whenever the second competitor releases something, the first one then goes and builds it. And that’s what I was talking earlier about the people who are doing it wrong in the long term are doing that. Because if none of your customers are asking for this and you’re basically just trying to be a clone of another service that’s successful, that’s not the way to find long term success, right? Over time, you’re eventually going to lose because that’s boring, you have no differentiation and you have kind of no unique selling proposition, you’re trying to duplicate someone else’s selling proposition, and again, just long term, that’s not the best play.
[28:22] So, we outlined this whole episode based on a single question from Robin Warren. Thanks for the question Robin. And if you have your own question for us and would like to see us answer it on air or turn it into an entire episode, you can call out voicemail number at 888-801-9690 or email us at questions@startupsfortherestofus.com. Our theme music is an excerpt from We’re Outta Control by MoOt and it’s used under Creative Commons. Subscribe to us on iTunes by searching for startups and visit startupsfortherestofus.com for a full transcript of each episode. Thanks for listening. We’ll see you next time.
Episode 216 | How a Single Founder Launched a 7-Figure SaaS App (with Nate Grahek)
Show Notes
Transcript
[00:00] Rob: In this episode of “Startups for the Rest of Us,” Mike and I talk to a single founder who launched a seven-figure SaaS app with special guest Nate Grahek. This is “Startups for the Rest of Us,” episode 216.
[00:10] Music
[00:18] Rob: Welcome to “Startups for the Rest of Us,” the podcast that helps developers, designers and entrepreneurs be awesome at launching software products, whether you’re built your first product, or you’re just thinking about it. I’m Rob.
[00:28] Mike: And I’m Mike.
[00:29] Rob: And we’re here to share our experiences to help you avoid the same mistakes we’ve made. So, what’s the word this week, Mike?
[00:33] Mike: Well, I’ve been to the gym 15 times in the last 18 days.
[00:37] Rob: Congratulations.
[00:38] Mike: I actually don’t feel all that bad. It’s just like there’re certain muscle groups that I didn’t know that I had.
[00:43] Rob: Did it get easier after the first few days?
[00:45] Mike: Well, the first week was the worst, and then since then things have gotten significantly better. It’s not nearly as bad as it was the first week. I mean the first week was really rough, and even my wife said it was like the – I was only three days in, and she was just like, “I don’t think he’s going to make it.” [Chuckles]
[00:59] Rob: So, MicroConf Vegas 2015 – it looks like we finally, finally have dates. So, it looks to be April 13th and 14th in Las Vegas; and then, of course, we always have the evening reception on the 12th. So, that’s really a Sunday night, Monday, Tuesday. We have signed a contract and sent it in. We haven’t received the countersigned contract yet, but my guess is by the time this episode goes live, that we will. So, if you’re interested in hanging out with about 200 self-funded startup founders, single founders, head over to MicroCom.com, enter your email address there, and we will be selling tickets in the next few weeks. Myself and Heaton Shah are confirmed as speakers, and we have basically a full list of all the speakers we’re going to be inviting. We just have not emailed everyone yet.
[01:45] Mike: On episode 214, where we discussed Inbox Zero a little bit, Jack Jones left a comment on the blog, and he said, “For Inbox Zero, I highly recommend FollowUp Then. I tried Boomerang and others, but FollowUp Then works completely via email – no separate app or plugin to use. This means you can use it from wherever you deal with your email. It has lots of cool features, like scheduling tasks, automatically, following up with other people and automatic cancellation when someone replies. Between FollowUp Then and emailing tasks to Trello, I’ve maintained daily Inbox Zero across three businesses and my personal life coming up on a year now.”
[02:15] Thanks for that, Jack. And Tyler also said, “The two tools that’ve helped me maintain Inbox Zero for quite a while are Boomerang and TeuxDeux.” And it’s T-e-u-x-d-e-u-x. “Boomerang’s perfect for getting emails out of your inbox when you want to deal with them later, while the simplicity and automatic task rollovers of TeauxDeux have made it my top to-do and calendar app.”
[02:32] Rob: Very nice. Good tips. We also got a comment from Ben on episode 215, which was our predictions episode in which I predicted that five-terabyte cloud storage would be under a hundred dollars next year. And Ben said, “The five-terabyte cloud storage for under a hundred dollars has already happened. Microsoft announced back in October that OneDrive will be unlimited cloud storage, rolling out in the coming months. Both Office 365 plans of around 70 bucks a year or a hundred dollars a year will also include unlimited storage. And while not unlimited, my OneDrive plan was bumped up to 10 terabytes for a hundred dollars back in November.”
[03:09] So, I appreciate you pointing that out. So, either I’m a genius with my prediction and I was ahead of my time, or I’m just misinformed about present-day cloud storage offerings.
[03:18] I tried out Cascade content based on your mention and basically had them write a knowledge-base article based on a screen cast, and this is for the Drip knowledge base, where I recorded screen casts because they’re faster for me to do. But I’ve had requests from customers that they want to see a written version of those, and so far, so good. They’ve done one video and turned it around in two or three days, and so I think I’m going to send them – I probably have five or six others that I’d like to get done. But what’s nice is this allows me, moving forward, to not have to worry about writing it out myself or hiring someone. I just have someone that I can send a video to as soon as I post it, and then within a few days, get it back – kind of like getting a transcript done or something.
[03:58] Mike: Awesome.
[04:00] Rob: So, today Mike and I have the distinct pleasure of having special guest Nate Grahek on the show, and Nate is a single founder who launched seven-figure SaaS app. He’s also a lifetime Academy member. So, welcome to the show, Nate.
[04:12] Nate: Thank you so much for having me, guys. I’m kind of a little star-struck, to be honest. It’s fun to listen to you guys each week, and to actually be on the show, it’s definitely an honor. Thanks for having me.
[04:22] Rob: Very cool. Well, do you want to start by telling folks briefly who you are, what you do?
[04:28] Nate: Oh, sure. In 2012, I started a company called StickyAlbums.com. It’s a service for portrait photographers to create custom, mobile apps for each of their clients. So, a wedding photographer, an infant photographer, high school seniors – they deliver a subset, like a very simple image gallery, as a mobile app; and it becomes a marketing tool for the photographer. That’s the big problem we solve. We help photographers get more customers.
[04:56] Rob: Very cool. And is your background in development? Are you a designer?
[04:59] Nate: My background was in training and development and corporate training, and very quickly I had to learn how to do web development because all training with the economy around that time was moving to the web. We couldn’t afford to fly people in for corporate stuff anymore. And so I learned HTML. I learned Flash. At the same time, iPads were blowing up, and my boss says, “Nate, we[‘ve] got to put all training in iPads.” So, in the course of figuring out how to put other content on iPads and iPhones and other mobile devices with HTML, I was also doing portrait photography on the side and kind of had that classic, light-bulb moment – like scratched my own itch. “How can I make my portrait clients better at referring me new business?”
[05:43] Rob: Very cool.
[05:44] Nate: And I asked one of my high school senior clients – because I was giving them paper business cards to pass out to their friends, and she’s like, “Yeah, we don’t like carrying paper. What if I give you your own custom app with your face on the icon, and you can just share that with your friends?” They were like, “Oh, yeah. I don’t go anywhere without my phone.” So, that was the crux of the idea right there.
[06:02] Rob: Got it. And so you were a photographer?
[06:00] Nate: Yes. I’ve learned a lot about what it means to be a professional photographer now. I’m very much humbled, as the range is huge.
[06:11] Rob: Sure.
[06:12] Nate: The market’s huge, but the range is also pretty big, and I was definitely considering myself a rookie on that scale. The domain experience really, really was valuable.
[06:21] Rob: So, you started StickyAlbums.com in – was that 2011 or 2012?
[06:27] Nate: 2012. I launched the site and the domain, like, late ’11 and then had my first sale right in January of 2012.
[06:35] Rob: Got it. And so today, towards the end of 2014, where does your business stand in terms of revenue – whatever you’re willing to share – and team size, if any? I’m not sure if you have full-time employees or –
[06:47] Nate: Yeah.
[06:48] Rob: – contractors.
[06:49] Nate: [I’ve] got a lot of competition, so I’m trying to decide what I should share with them. They just flooded the market after I approved this idea –
[06:55] Rob: Oh, jeez.
[06:56] Nate: – and the competition’s been healthy, but it’s all good. So, within the first two years, we grew to 5,000 photographers. Everybody can do the math. It’s roughly a million dollars in annual revenue. That was a blur. To grow that quickly was pretty intense. And now the last year – so, our third year of business, we’ve kind of plateaued a little bit because of the annual, recurring thing, where we have people that are no longer photographers that were. And we’re still replacing them with new photographers at a pretty good clip.
[07:25] And then since this year, I really sat on the decision of growing the team for a while, because I’m really a huge fan of you guys’ podcast and the idea of staying small and flexible and manageable. But I knew that I wanted to grow something for photographers that was going to be around in the next five years. In order to do that I wasn’t going to be able to do it myself anymore, and so this year I invested a lot of energy in growing the team. We now have four full-time employees, including me. We’re hiring our fifth in January. We’re hiring a full-time designer I’m pretty stoked about, and then we have four other part-time employees that are contractors. So, that growth was exciting. It’s daunting to switch gears into being a manager now. A lot of my time goes to managing, but it’s really rewarding to create a remote culture where people can come to work when and how they want to. I get the unique personalities from everybody adding to a much greater sum. It’s pretty cool.
[08:22] Rob: Yeah, that’s a lot of fun. I know that feeling, too – you know, having gone from kind of doing everything on my own to then expanding. It’s good to have a team.
[08:29] Nate: Yeah, it is. It’s daunting. I’ve got two, small kids. I knew the risk involved in growing. Being a manager always takes more time than you think it does. There’s a human element you never plan for. Despite all that added complexity, it’s incredibly rewarding. Like, I got to give people holiday bonuses this year, and that’s felt really good.
[08:47] Mike: So, one of the things that you mentioned early on was that you were talking to somebody. You wanted to give them a business card, and they just said, “Oh, we don’t really like paper.”
[08:55] Nate: Yeah.
[08:56] Mike: And you kind of went down the road of saying, “Well, I could put your face on an app.” What sort of validation did you do for this idea, or did you just kind of dive right in?
[09:03] Nate: Well, it was first, like, the ‘scratch my own itch’ model where I just made these. Technically, I know I’ve got a lot of developers on the call. It’s an HTML 5 web app, so we’ve built it using some open-source and some proprietary tools. We prompt the user to save the web app to their home screen, and we populate it with a home screen icon, but it is just a website that saves offline. And so there’s huge advantages to it being that way, where it’s shared with just a link instead of it being an actual, native app. There had been other vendors in this space that have tried that model and failed because it’s too complex to try to submit that many apps to the app store. The photographer has to have their own developer license and on and on and on. There’s just a lot of complexity there that we short-cutted by making it HTML, and it’s something I figured out. I taught it myself, and I was just making these sites for my own personal photography clients. I gave them to the client, and they loved them, and it brought me new business – and so much new business that I stopped sharing them in my own business, because I knew I wanted to grow StickyAlbums – not my photography business. So, I had to stop using my [chuckles] own product because it was working too well.
[10:12] Mike: Got it. So, this is really not even an app itself. To the user, it looks like an app, but really it’s a shortcut to a website on their phone – right?
[10:20] Nate: Exactly. I can do a link, or I’ll give you guys a URL. I can post my show notes, and people can see an example of what one looks like.
[10:27] Rob: Very cool. And your pricing – it’s 19 bucks a month, 29 bucks a month; and then you have a lifetime, it looks like, that’s $699?
[10:34] Nate: That’s actually going away. The pricing page is kind of tricky. We could spend time there, if we want to, but it’s kind of –
[10:40] Rob: Oh. It’s 19 a month if it’s billed annually, 29 a month if it’s billed monthly.
[10:42] Nate: Right.
[10:43] Rob: Got it. I missed that.
[10:45] Nate: 90, 95 percent of our customers are on the annual membership, and we just find that works a lot better. People commit. Because it’s a marketing tool, we’ve learned that people who do the monthly are just experimenting, and they don’t take it seriously enough. And if they don’t see the results right away in that first month, then they don’t renew; whereas, when they bite off for the whole year, we have that whole year to engage with them and to teach them how to use the product. And they get to see results, and then they’re a customer for the long haul.
[11:14] Rob: And do you find that the sales effort up front is a lot harder? Because you’re essentially trying to get a couple hundred dollars all at once up front, rather than –
[11:23] Nate: I don’t think it necessarily make it harder. I’ve learned that using a discount code, a lot of people do sign up with a discount. And it’s that deadline. It’s a limited-time offer, and we do a lot of partner deals. So, one way or another, people need a reason to buy today. That’s the thing we’ve found, and beyond that, it doesn’t matter if it’s annual or monthly.
[11:45] Rob: Right. And when you said “it’s going away,” did you mean the lifetime membership?
[11:49] Nate: Yeah, yeah, yeah. We’re removing that.
[11:50] Rob: Got it.
[11:51] Nate: That was early on. It helped us grow big and reward some of our most loyal customers, but we’re going to take that away and bring in a two-year plan.
[11:58] Rob: Nice. So, you’ll have monthly, annual and two-year. So, you mentioned earlier that you grew to 5,000 paying users in your first year. Obviously, that’s 5,000 photographers who found you, who decided to buy. A lot of folks listening to this podcast are probably wondering how did you achieve such enviable growth. Was there one tactic? Was it a combination of tactics? What was it that gave you that hockey stick?
[12:22] Nate: It was 5,000 by two years. At the first year, I was at about 3, and then the second year we made it to 5. It’s not just one. I think the one that enabled the crazy speed was word of mouth. It was that I did a couple things really well. I treated my customers well, and then it’s that word-of-mouth referral. We had a tracking form when people first came in that says, “Where’d you hear about us?” and I would celebrate. Once a week or once a month, somebody would write, “Everywhere.” [Chuckles] Like, “Oh, my gosh. That’s so cool.” They were hearing about it from their friends, from other places, from other blogs. So, it was definitely a combined approach. But I think, more than anything, people buy when something’s been referred by somebody else that they trust.
[13:09] Rob: Right. It’s a lot easier sales process if someone’s already been referred, rather than seeing a cold ad and then having to get familiar.
[13:16] Nate: I have a theory. We do a lot of education now, too, and teaching other photographers how to do marketing themselves. And I tell them that paid advertising – I think the only time it works is when you already have a foundation of word-of-mouth referrals happening. Somebody’s like, “Oh, yeah. I heard about this cool photographer, blah, blah, blah. And Julie said she was great.” And then later on that week, you see an ad in a local newspaper. [They’re] like, “Oh, yeah. That’s right! I remember. I wanted to call Julie.” But if you just saw that ad for Julie, and nobody had told you who she was, that ad’s not going to really do anything.
[13:50] Rob: Right.
[13:51] Nate: And we found that to be true in our business, too, where our paid advertising is only icing on the cake when we have that good word-of-mouth buzz happening first.
[14:00] Rob: So, obviously, once you had a thousand or 2,000 people using it, then word of mouth is going to help. But how did you get those first few hundred users?
[14:09] Nate: I got really lucky with a – this was even when it was first Concierge. We didn’t even go to the actual builder code that was written, that is the base of the business today. I went to market without that. I went to market where I was selling this as if, when photographers were uploading their pictures, like a machine was doing it; but it was actually just me. [Chuckles] I was taking people’s pictures and building these one-off albums one at a time. I had a friend help me build some automation so I could be faster for myself on my local computer. I used to take, like, ten, 15 minutes to build each one. And now, with the app he made for me – he made this small version of an app that took it down to five minutes per album, and that let me go to market. And I did a paid blog post review, and that got us our first 15 to 20 customers.
[15:00] But then there was a site called Photo Dough; and they had, like, a Groupon for our industry. Their meteoric rise also. And so doing a deal there was perfect, because everybody knows Groupon. I didn’t have to pay to be there. They just got a cut. The timing was right. For that first three days, we did $10,000 in revenue. And, ironically, I had at the same time been shopping for developers. I’d met with three different developers, and they’d all estimated the MVP was going to be about ten grand.
[15:32] And so my wife was pretty excited. It was a fun, exciting day to refresh the web page and just watch the sales go up. And she was like, “Oh wow! When do we get some of that?” I was like, “Actually, now that we have 200 customers, I have to get this thing automated ASAP.” And, luckily, the team was able to build it in 30 days; because that month I think I built 400 websites by hand until the automated builder was done. And since then, we’ve made close to a million, I think, apps.
[16:02] Rob: Wow. Yeah, that’s really impressive. So, you definitely pulled the MVP approach – kind of the lean startup approach of just getting out there and selling something, seeing if it caught fire. And with you, it obviously did, and then you had to use human automation to get you through it.
[16:16] Nate: Yeah, it was terrifying. I risked $300 of my own money –
[16:19] Rob: Yeah.
[16:20] Nate: – and then after that, it was building with the customer money. And I was definitely nervous. I said to myself, “If this fails, I will just give people their money back and apologize profusely.” But I wasn’t ready with a mortgage and – we had just had our second kid. He was a month old. I wasn’t ready to risk $10,000 of my own money yet. I wouldn’t recommend anybody do something like that at that stage of their life. The lean startup stuff was – I wasn’t even familiar with what I was doing, that it was called “lean startup” until I found podcasts like you guys. I was like, “Oh, there’s a name for what my wife forced me to do.” [Laughs] She was like, “There’s no way you’re spending that kind of money! Figure it out – how you’re going to do it without it.” And that’s what I did.
[16:58] Rob: Very cool.
[17:00] Mike: So, it sounds like there wasn’t very much time between the time you had the idea and you realized that this really had legs. I’m curious to know what your mentality was going into it, thinking that you were going to do all of this stuff by hand versus automating it first, because I think that’s a common situation – where people run into something, and they have this idea, and they say, “Oh, we’ll, I’ll build some code,” because, naturally, most of the people listening to this are developers. And that’s what they do.
[17:25] Nate: Yeah, right.
[17:26] Mike: So, their first instinct is to write code to solve the problem. You clearly went in a different direction, and that’s one of the things that lean startup advocates – is testing the idea to make sure that it has legs before you do a lot of investment. And I’m curious to know what your mentality around that was. Or, was it just, “My wife said so”? [Chuckles]
[17:44] Nate: Yeah, right [chuckles]. The first idea was sitting around the fire – it was October of 2011 – with my neighbor, who was a developer. I knew education – right? So, I was going to sell a product. I was like, “There’s this huge market to sell informational products to photographers. I’m going to sell videos,” because that’s what I did in my day job, “teaching people how to make these HTML apps.” Thank goodness for one of my good friends now. He was like, “Dude, there’s such a small subset of people that will actually take the time. Photographers don’t want to deal with HTML. You’ve just got to build a builder for them, and it’s not that hard.” I was like, “Wow. Really?”
[18:18] So, that’s the idea. And then four months it took to flush it out. I put my energy into the marketing site so that I could validate the idea with sales. That was where I put all of my energy and then was just going to continue being the – like, the builder was just the concierge, like human labor – a model first to test it. But I quickly learned there was a lot of things that I thought I would have to build from scratch. I built on WordPress, and then I bought a membership plugin. So, I thought I was going to have to hire developers to build all of the membership stuff, too; but that was already just, like, a hundred-dollar S- – I think I used an S2 member plugin for a hundred bucks. And it let me go to market with PayPal integration right away. Within two months, I was able to put up a sales page. I knew sales was the first thing I had to show before I was going to invest more money.
[19:12] Rob: That’s really cool that that was your intuition, because obviously, with most people – developers, designers, or otherwise – the typical inclination is to build something first, to go into your basement and build it. But you obviously wanted to get sales first. Where did that come from? Why was that your number one before you built anything?
[19:31] Nate: I had the idea – right? It had worked for me already in my business. And other photographers, I had shared the – quote/unquote – “product.” They saw the finished albums that I was making. That was it. That was the MVP there. I can sell making these for photographers. So, flushing that out – that was actually the first thing. I was just getting creative in my own photography business – like, “Oh, what could I make for my customers in photography? Oh, this is cool. Oh, wait. This might be a huge market for other photographers – not just my own business.”
[20:06] And when I made the switch from making something for my own photography business to being a service for other photographers, that’s where most of the energy went into building a sales page; because I had already put in the work building the – quote/unquote – “product.” I put probably three, four months into researching what the format was, what different tools we were going to use in the JavaScript and the HTML format of the album. So, there was definitely some time there. Luckily, I think, I switched gears off of the product. I had dreams about making it amazing, but luckily my first developers that I hired – they were really big 37Signals fans, and they were good at coaching me to keep the MVP actually an MVP.
[20:52] Rob: And you had kind of a Cinderella story early on. I mean it’s kind of a rare idea that gets this much traction this quickly. I’m curious. You had to have run into some hurdles, some roadblocks within that first year. Does one come to mind that really made you pause and think like, “Maybe this won’t work”? If you don’t have one that made you think that, maybe there was a darkest-hour time.
[21:17] Nate: Yeah. I think probably the biggest challenges were personal, to be honest, like the fact that I had two children. My wife was like, “Are you serious? Now is when you want to launch a business? We have a two-year-old and a[n] infant.” So, deciding when to quit the day job was very daunting. There was so much going on, because I was still working the day job those first four, five months and coming home till two in the morning, working on building these for people. So, that was very, very taxing – to work a 40-hour day job and then come home and put another 40 hours a week into launching it. That was not sustainable. I burned bridges with friends and family in those first months so that I could make the leap and quit the day job.
[22:03] And then once I was able to quit the day job, then the challenges after that were staying focused on sales. I’ll share my revenue chart. I would have a record month, and then the next month would be like half the size. And then I’d have a record month in sales, and the next month it’d be half the size. And it repeated this pattern because I was doing support also. And as soon as I was able to hire a good support rep, that’s when we had consistent growth, because I could stay focused on sales and marketing and partnerships, and she could stay focused on engaging the customer. As soon as I would pull away – and it was good. Again, I’m glad I did that. It was good for me to stay super close to the customer and know their issues and really understand what problems I was solving and which ones I wasn’t. It was instantaneous. That’s the point I wanted to make – is as soon as I took my hand off of sales, I could see it impacted in the numbers right away. As soon as I stopped selling and marketing and building relationships with other people, sales would drop off. And that’s a constant today. As soon as I try to slow down and focus on something else, sales slow down, too.
[23:07] Mike: So, it sounds to me like you’re constantly pushing down on that pedal to make sales and marketing work for you. But aside from the word of mouth, what’s your most successful marketing channel that you’ve kind of stumbled on or identified so far?
[23:21] Nate: Yeah, absolutely. As I transitioned into this, like the marketing piece, it’s also been tempered with learning over time that there’s always more features to build. I love building new features, and the majority of features we’ve put in have come from customer requests. That’s never-ending. I could fast-forward five years, and there’s always going to be more to build. And my goal has been to make sure that we have the ability to build features, like, we still have a business to build features for. And I’ve luckily focused on sales to make sure that we just keep the lights on, I think, is what’s important. There’s a lot of other competition in our space that’s come into the space and price really cheap. They come in, and they fizzle.
[24:04] This is one story I like to share, this very humbling call. This was an early challenge. When you first launch a product, there’s this terror. I would wake up every morning, like, “Somebody else has my idea. Somebody’s going to rip this off and steal it.” And that was a pretty constant challenge. And then after six months, we had one. It would really stress me out at first, and it took me a while to really get over the early, like, “Stop being worried, so focused on the competition. Just focus on your own business and our own customer base.” And I finally got better at that.
[24:36] There was this one vendor that I stumbled across. I think he was in month two or three. And it ruined my day. I was so sad. They had so many more features. They had the HTML site. They had the app side – the native side. Their marketing video was really well done, better than what I thought ours was. And the moral of the story is fast-forward three years. I actually got an email from this company saying, “Hey, Nate, we love your marketing and follow what you’re doing. We’re actually looking to sell and wondering if you’re interested.” And I had the whole conversation really wanted to understand what worked, what didn’t; if there was an opportunity for me to buy them. They had ten customers the last three years. While they had built this amazingly robust, feature-rich solution, they hadn’t put any energy around marketing it and educating people about how to use it in their business. They wanted to recoup some of their money that they had invested in, like, contracted development. I felt terrible. I really empathized with these guys, but it’s one of these classic cases where they focused too much on building one more feature with their own dollars instead of building it with the company.
[25:44] And that comes from my commitment to my customers. I want to be around here in five years so that we still have a service to provide. And I do that by making sure we’re growing a healthy company.
[25:55] Rob: Right. And their story is the more common path – right? That’s the more common story we hear of people launching a startup – is that they err on the side of too much product rather than too much sales.
[26:06] Nate: Yeah. But it’s so counterintuitive. I was like, “Oh, we’re done.” It was one of those things where I found it on a Google search, or somebody said, “Hey, Nate, have you seen this company?” And I was like, “Oh, wow. That was fun. We’re done.” I really thought [crosstalk].
[26:21] Rob: They were going to put you out of business. Yeah, that’s actually really common in terms of competition coming up. You always think they know more than they do, and especially if you’ve been in a market for any length of time and you’re good at it, you typically are way, way ahead of them in terms of revenue, customer count and in terms of your intimate knowledge of the market.
[26:39] Nate: Right. There was an analogy I made early on that I had to relearn my mindset of what the Internet is before launching my own online business. A lot of the things I consumed online were trending things. Every once in a while, something trending comes up, and I go, “Oh, yeah.” And it feels like we all know about the trending things that are happening. We all know about Uber. And instead, what I’ve learned is the Internet is like a big room – a really, really, really big room. And you can yell about something for years, and the majority of the Internet still won’t hear you. And that is what took me some time to realize – that it’s all about getting other people to talk about you and getting your message out, because people don’t need to hear about you just once. They need to hear about you over and over again. And just because you’re yelling in your corner doesn’t mean anybody’s hearing you yet.
[27:26] Rob: Right. Wise words. So, Nate, back in May of 2012, I did my first Mixergy sometime around there. And you emailed me afterwards, and you said that you saw that I had the Micropreneur Academy, and you asked me a few questions about it. And we had a short email exchange that I hadn’t remembered when you and I reconnected later. And then in June of 2013 – so, that’s about a year later – I did a Growth Hacker TV interview, and you sent me this email, and you said:
[27:55] “Hi, Rob. I just watched your interview on Growth Hacker TV. Great stuff. It’s been just over a year since I emailed you and then joined the Micropreneur Academy. While I feel I was so busy executing that I was only able to implement about 10 percent of the full course content, the little that I did implement was invaluable. The majority of my customers are on annual plans, and with the first few months of renewals being decent, May was my first $100,000 month.’ So, you said, you know, thanks. And you felt a lot of gratitude [to] both myself and Mike for the podcast and then others who are so willing to share what we’ve learned.
[28:27] Nate: Yeah.
[28:28] Rob: That was cool. I love hearing that kind of story, because you kind of came out of nowhere. I was just like, “Whoa! Who is this guy having so much success?” And I’m curious if you recall any specific times where you may have used either advice from the podcast, or from the Academy, or stuff that Mike and I’ve shared that helped you out as you were growing.
[28:47] Nate: I think I heard you talk about the point of just execution early on – how important executing is. And when I started in the Academy, I think I downloaded all of the MP3 courses right away and just listened to them on fast mode whenever I was commuting. And the one that sticks out for me – I think you did a class on joint ventures, or marketing partnerships; and I think that’s one that’s just been probably – when you asked earlier my most successful marketing tactic. It’s just been relationships – building relationships with other people. Like Marketing 101. It’s finding a reason for other people to talk about you and what your service is.
[29:27] And so some of that was easier. It was a brand new product. And think about a blogger, somebody whose job is to educate and share good ideas to their audience. They love having something brand new and shiny to show off and talk about. So, getting my foot in the door was relatively easy earlier, but now it’s had to transition to building the partnership based on the audience that we now have. We can kind of swap back and forth, and then also focusing just on really good content, just really educating people. And I also learned the value of education, obviously, through Micropreneur Academy. It was just invaluable.
[30:05] Rob: Very cool.
[30:06] Nate: There’s a couple podcast episodes that I find myself forwarding to other early-stage entrepreneurs a lot. The first two are the product test and the founder test. It really helped. The founder test especially helped me look at my own blind spots, or my own opportunities for growth and not feel so bad about it. And through growing the team, it helped me identify key personalities I had to hire for. And one of the best lessons I’ve learned – I also was really fortunate to find a mentor in Clay Collins, who’s the founder of LeadPages. He’s here in the Twin Cities. He told me the best lesson in hiring is you want to hire early in your business people who are good at doing a thing instead of a jack of all trades. That way, you don’t have to stop and teach them how to blog, or how to podcast, or how to do webinars. If they’re already doing those things somewhere else, they can come in day one and start generating revenue for you.
[31:06] Like, my first hire was customer support. I almost hired somebody that was just good at knew photography, but didn’t know how to do tech support. And, luckily, [at] the last minute, the last person to apply – she had done customer support somewhere else. That would’ve probably broken my business had I made that wrong decision. Luckily, I chose the right person who could come in day one, and she started handling most of the support tickets, like right away.
[31:30] Rob: Very nice.
[31:31] Nate: And I’ve learned that lesson on both sides ever since. And then, finally, the episode 141, “Five Elements of Effective Thinking,” where you guys did that book review. I love – I quote that on, like, a weekly basis, I feel like: just really focusing on doubt. And I really get worried about people who are certain about things. Having the guts to question and to be skeptical – it’s so true that in politics and other areas we devalue that. We feel like somebody’s wishy-washy. But when I’m hiring, and when I’m building partnerships, it’s like a huge red flag if somebody is absolutely certain about a thing. It’s like wait a second. If you’re certain, that means you probably just haven’t been doing that for long enough. [Chuckles]
[32:14] Rob: Right – to see the nuance of it.
[32:15] Nate: Exactly.
[32:18] Rob: It’s too black-and-white. Very cool. Well, thanks for sharing that. So, those were episodes 133, 134 and 141 you mentioned. I think all of them are in our little “Greatest Hits” area of our website, and we’ll link them up as well.
[32:30] Well, thanks, Nate. We really appreciate your time, coming on the show and sharing your story. I think it’s been inspirational for folks listening. If someone wants to keep up with you on the Internet, where would they do that?
[32:43] Nate: I like wrapping all of my podcasts up as a reward for people to listen to the very end. I love the feedback of, “What part of this interview was the most valuable to you. Send me an email: nate@stickyalbums.com.
[32:57] Rob: Awesome. Thanks again for taking the time to come on the show, Nate.
[32:59] Nate: You bet. Thanks for having me, guys. It was a pleasure.
[33:02] Mike: Thanks, Nate.
[33:03] If you have a question for us, you can call it in to our voicemail number at 1.888.801.9690, or email it to us at: questions@startupsfortherestofus.com. Our theme music is an excerpt from “We’re Outta Control” by MoOt, used under Creative Commons. Subscribe to us on iTunes by searching for “startups” and visit startupsfortherestofus.com for a full transcript of each episode.
Thanks for listening, and we’ll see you next time.
Episode 215 | Our Predictions for 2015
Show Notes
Transcript
[00:00] Mike: In this episode of Startups for the Rest of Us, Rob and I are going to be talking about our predictions for 2015. This is Startups for the Rest of Us: Episode 215.
[00:07] Music
[00:15] Welcome to Startups for the Rest of Us, the podcast that helps developers, designers, and entrepreneurs be awesome at launching software products, whether you’ve built your first product or you’re just thinking about it.
[00:22] I’m Mike.
[00:23] Rob: I’m Rob.
[00:24] Mike: And we’re here to share our experiences to help you avoid the same mistakes we’ve made.
[00:27] Rob: So we’re not predicting anything about our businesses. These predictions are like the global kind of broader world of technology and entrepreneurship.
[00:34] So for me this week after about sixty days of my Facebook retargeting ads not showing up because I was in Thailand when they changed the image size you needed, and I couldn’t get new images made in time, after about sixty-something days I finally got those working again this week – or late last week – so they’re really showing up now. It feels good to have that done because I hate it when retargeting’s not running. And while I was at it, since I had a bunch of banners made I’ve started a trickle of Facebook ads again, and I started some YouTube ads, and I figure if I’m going to do some paid acquisition and I’m in the mindset of it in optimization I may as well dive in with both feet.
[01:09] Mike: That would explain all of the ads for Drip that I’m seeing.
[01:11] Rob: Are you seeing a lot?
[01:12] Mike: No. [laughs]
[01:13] Rob: Oh.
[01:14] Mike: I see them here and there. I don’t see a lot though.
[01:17] Rob: You know, retargeting is CPM so it’s per impression whereas if it is an actual Facebook ad, then I do pay-per-click if it’s not retargeted. If you’re seeing them though since you have a Drip account you should not be retargeted. So if you’re seeing them it probably would actually cost me seventy, eighty cents if you clicked it.
[01:35] Mike: So I think I talked a couple of weeks ago about my problems with my bank. I’m actually in the process of switching over to Silicon Valley Bank at this point. So hopefully all my accounting issues are going to go away shortly, and I won’t be overcharged for wire transfers anymore. They make it so difficult to change, and then with all the new laws and stuff you have to prove who you are and actually have you fill out forms and then mail the forms to them if you’re doing an online bank now. It doesn’t matter that it’s all done electronically, they still need some of this paper stuff.
[02:08] Rob: Right. Ah, the Patriot Act.
[02:10] Mike: But aside from that I’ve just been working on mostly AuditShark demos. I spent some time looking at some of the different landing page services because things are a little bit slow now because it’s December so people are kind of busy with holidays and trying to get ready for the new year. So I’m not having as many conversations with people, but I’m starting to look at kind of what my marketing efforts are going to be looking like next year. So I tried LeadPages a while back and it didn’t really work out, so I took another look and started looking at KickoffLabs and Unbounce and LaunchRock, and I think I’m going to go with KickoffLabs for a while and see how that works out.
[02:43] Rob: Very cool. So Kyle Albert tweeted us about a year ago, and I found it in an old outline for a podcast episode as I was searching for something else, and I noticed we never responded to him. So I wanted to respond in this episode. But first a quick service announcement: if you are not connected to @robwalling on Twitter and @SingleFounder on Twitter, you are missing out because it’s like a party up in there every day. So Kyle Albert, as I said, is @kylealbert95, tweeted us a while ago and said, “Have you guys seen this? Would be interested in hearing your take on startups for the rest of us.” The article is called “The Value of Content” and it’s written by Andy Beaumont. And in essence, he started a website called TC;DR, it’s “Tab Closed; Didn’t Read,” and he stated that his preference when he goes to websites is that they don’t popup a big lightbox, right? they don’t ask him for email, they don’t popup an ad, they don’t block the content. The whole post talks about how that’s a negative user experience, and he himself just closes a website instantly if they do that out of principle. And there was a whole discussion of it, and actually Ramit Sethi weighed in on Twitter, and he said, “100% of the people who are cheering this site have never run a website & seen the analytics behind lightboxes” so he obviously comes out on the side of lightboxes.
[03:59] Obviously emotion can run wild on this because you can get on both sides of this argument and kind of make this a religious debate. My take is that it is a personal preference like anything else in selling. You can be a used car salesman or you can be someone who doesn’t sell at all. And these are the kind of opposite ends of the spectrum or you can be somewhere in the middle, and everyone has their comfort zone. And so if your comfort zone is that whenever you see a lightbox it infuriates you then that’s fine. Express your- that’s your right, right? You’re expressing your freedom of being able to close that browser tab, and that’s okay.
[04:33] What’s interesting- but I wouldn’t take that as something- as a reason to never have a lightbox on your site. Personally, I have not used lightboxes because I don’t enjoy them. I don’t think they’re the optimal user experience. However, they are the optimal way to collect emails. You will get more emails. Now then there’s debate about if the people who put emails in are as valuable as the ones who actually seek out the form, and that’s a whole other discussion. But that’s my opinion on it: is that the numbers play out that lightboxes, or something that blocks the screen, is better in terms of ads, in terms of collecting emails, but keep in mind that, you know I have this rule that I will never write copy- I will never write sales copy that I wouldn’t say to someone at a dinner party or at a MicroConf attendee party, because that’s just my personal kind of compass of how far I will go for something. And for me popping up a lightbox is a little irritating, but that doesn’t mean that I judge people or websites that do it. I personally don’t TC;DR them.
[05:28] Mike: I think that what Ramit said about the “100% of the people who cheering this site have never run a website & seen the analytics behind it” I think that there’s a great deal of truth to that because I mean if you even look at in the startup community, people who are building businesses- there are all these people who are sitting on the sidelines who have never done that kind of thing before, and they’re sitting there Monday morning, armchair quarterback saying, “This is what you should be doing, and this is what I think you should do, and this is how I think it should work,” but at the same time they’ve never gone through the effort of trying to do any of that stuff. What I tend to find is that the people who I’ll say are out there and in the trenches and actually doing this stuff have a lot less negative things to say about the things that other people are working on than the people who have never even made the attempt. I’m kind of overgeneralizing here because I don’t want to say “everybody” because there’s certainly people who take this way, way too far like the second you get onto a website, boom: lightbox. That is annoying.
[06:27] There’s definitely a way to go too far. And there’s also that wide swath of comfortability where some people will say, “I will never do lightboxes,” and there’s other people who say, “I’m perfectly comfortable putting a lightbox up there because I want people to see the stuff that I’m creating because it is valuable, and if you have any of these types of challenges I can help you, but I need to be able to get in front of you in order to be able to do that.” So it’s definitely a comfortability thing, but I think that there’s a huge range of places where you can fall on that.
[06:56] Rob: I think you bring up a really good point. You know I have that phrase “it’s easy to criticize from the stands.” And you bring up the folks who criticize a business for- you’ll get emails that say, “Oh, you’re too expensive. You should never charge that much,” or let’s say you only have annual plans. You’re definitely going to get people who call and complain about that. Or maybe you have an ad headline or image- people just always have feedback about how you shouldn’t do that. You’re taking it too far. If you ask for a credit card up front people complain. But it’s easy to criticize from the stands. It’s like the people who are complaining about those things and probably this TC;DR thing have very, very likely never actually seen what it takes to build a business.
[07:33] Mike: And I think that in cases like this you get into situations where if you are not getting the number of leads that you need, then this very well may be the direction that you go in, and if that’s what gets you to the point where you are getting the number of leads that you need, then maybe that’s what it takes to build a business. And it’s hard for me to sit here and criticize somebody for doing that. Would I do it? Probably not. But would I criticize them for their business practices around that? If that’s what’s helping them stay in business, and I’m kind of making an assumption here that they are providing value, they’re not screwing little old ladies out of their Social Security checks. So Kyle, hopefully that gives you an idea of what Rob’s take and my take on that is.
[08:12] So I think today what we’re going to be doing is we’re going to be talking about our predictions for 2015. Why don’t we start off by going back to 2014 and talk about what those predictions were and see how well we did on those.
[08:22] Rob: So my first prediction for 2014 was that Twitter would become more profitable and piss off its users in the process, but that it would be a solid opportunity for paid placement and promotion for entrepreneurs. And that didn’t happen. Twitter is still not profitable. I don’t think it’s pissed off its users with the ads it’s done. It’s actually done a pretty good job. I haven’t heard much of an uproar. I do think it’s a solid opportunity for paid placement. I’ve heard a few folks making it work. I don’t think- it’s not Facebook was three years ago where a lot of folks were in there really making money, but I still am keeping my eye on it to figure out if Twitter is going to be a good paid acquisition platform.
[09:00] Mike: My prediction was that Apple releasing a new product is a gimme. And I would say that they probably didn’t necessarily release new product, did they? They didn’t come out with the watch. They announced it, but they didn’t actually release it.
[09:12] Rob: No, and my second prediction was that Apple would release an iWatch. And I actually meant- and I really did mean “announce”- rather than release, but it’s neither here nor there. My third prediction was that concierge services and concierge onboarding would become a requirement for SaaS apps in crowded markets. I don’t know how we measure that one. I know that a lot of people are doing concierge. I was on a call today with a SaaS entrepreneur who’s adding it, and the other person on the call already has it. I hear a lot- there’s several people in the building that my company is in that have added it in the last year so I don’t know if I would go as far as to say it’s a requirement if you’re in a crowded market, but I think it’s a really good differentiator, and I think people are using it to great effect unlike they were two or three years ago when very few of us were doing it.
[09:55] Mike: My next prediction was that more high profile acquisitions will start to be turned down – kind of reminiscent of what Snapchat did. And there was one called Cyanogen. They turned down a $1 billion dollar acquisition offer from Google. The thing is I don’t know whether there were other ones that I didn’t really pay attention to. I think the Snapchat one was kind of in everybody’s faces because it was one of the first ones where it was very public that they got turned down. I would probably give this half credit because there was one, but I don’t know if there was a lot more or anything like that.
[10:27] I think this next one that I had is a little bit difficult to measure as well, but investors are going to start to pour more money into startups. Do you have an idea?
[10:35] Rob: I mean, I’m looking at annual venture capital investment amount and deal volume and both of them- this is according to a report from Mattermark.com, and they showed 2013 there was 6,208 VC deals and in 2014 there was 6,700 so that’s up 500, and in addition the actual amount of money invested in venture deals looks like it goes up about twenty-three percent between 2013 and 2014. I’d give you a point.
[11:03] My fourth prediction was that Kickstarter would have a major multi-million dollar fail. And what I meant by that was that a product would come out and get funded and then not deliver and that it would be kind of a big catastrophe for them. And I would say that did not happen in 2014. There were some smaller dollar amount failures, but I think they increased kind of the restrictions on the Kickstarter program, and if people are failing they really are trying to get the money back at this point.
[11:32] Mike: My fourth prediction was that I don’t see a clear winner in either the game console market or tablets. I thought that it was going to go back and forth a lot, and I think that if you were to look at Xbox One and PS4, I don’t see a clear winner in that scenario. I don’t know if there’s a huge difference between them.
[11:48] Rob: My fifth prediction was that Apple would continue to lose market share as history repeats itself thirty years later. And specifically, I was talking about mobile devices, iPad, iPhone, that kind of stuff. Now, the iPad has been losing market share, but it’s funny – when I actually look at this diagram – they’ve been losing it really since late 2012 so the fact that I made this prediction a year after that really isn’t much of a prediction. I wasn’t fully aware of this, but it’s noticeable. Apple’s iPad market share of global tablet shipments has pretty much been consistently going down every quarter. There’s just so many other tablets, right? Android has done a good job of getting out there and Samsung and just all the other tablet makers have legitimate tablets on the market now as well as the Kindle Fire.
[12:32] I know a lot of folks are doing that instead of the iPad. Friends that I talk to have said that iPad is just too expensive for them. Well, I personally enjoy my iPad. I know that folks have a lot of alternatives these days, and in essence the same thing has happened with the iPhone. There are just so many solid phone alternatives. There has been a pretty steady decline in that as well.
[12:54] Mike: My next one was that Google Glass will become publicly available in 2014 or early 2015, and if you go out to Google’s website you can actually buy a pair of Google Glass right now, but it’s still considered a beta product. But I don’t think it’s something that they’re intent on releasing to the general public in mass quantities like people were predicting before. I still don’t see that anywhere in the near future.
[13:19] Rob: My last prediction for 2014 was that integration marketing would pick up steam as more companies offer APIs and become more connected, and integration marketing is actually an idea that I took from Ruben Gomez of Bidsketch back in the day, and it’s where you do integrations with other SaaS apps and other companies, and then you promote the integration, and you get them to promote you to their audience. And I know that I’ve been using this quite a bit, and we did more than a dozen integrations this year on Drip. I wouldn’t necessarily say that integration marketing has picked up steam.
[13:54] I do see that everyone, every SaaS app I know that comes out has an API within a few months of release, and that’s really cool. So the ubiquity of APIs and the ability to do these integrations is a good thing. I don’t know that I would necessarily say that a lot of people have jumped on this bandwagon and that it’s picked up steam, but it is definitely working for those who are using it.
[14:14] Mike: Yeah, I’ve noticed that there are full blown companies that are kind of coming up and creating services completely around other people’s APIs just like hooking from one API to another, so that’s kind of cool to see.
[14:26] So my last two predictions, one of them was more of our listeners are going to start flying solo. And we do get emails from people from time to time telling us what it is that they’re working on and asking us to add their website information over to where we highlight some of the successes that our listeners are having. And then the other one was that targeted marketing individuals will start to become a reality, and I haven’t really seen this. I guess what I was thinking was that you would start to see more individualized ads for people. I mean being able to go down and use big data to figure out who somebody is and be able to put targeted ads right in front of that specific person, and I haven’t really seen that. And I wonder if that’s more because of data anonymity or privacy concerns or anything like that.
[15:10] Rob: Yeah, I would definitely say it’s about privacy concerns, because privacy’s been a big issue with all the big players – Facebook, Twitter, and Google, even Apple coming out and basically saying, “We sell devices and we don’t want your data” trying to talk about how you could use Apple products instead of Android products because of Google collecting all the data about it. Who knows? But I do think that’s why that hasn’t come around. Not because the technology’s not there but because the privacy concerns would be big.
[15:35] Mike: So now that we’ve kind of covered what 2014 looked like, let’s talk about 2015. What our predictions are for 2015. Do you want to go first?
[15:43] Rob: Sure. My first prediction for 2015 is that Twitter will become profitable and piss off its users in the process, but it’ll be a solid opportunity for paid placement promotions.
[15:53] Mike: I think hindsight is 20/20.
[15:54] Rob: Does that sound familiar? [laughs]
[15:55] Mike: It does sound familiar. I’m not sure where I’ve heard this before.
[15:58] Rob: This is the exact same prediction I had for 2014, and I’m sticking by it. I think it’s going to happen in 2015. They’re not profitable now. I think they’ll do it in 2015.
[16:06] Mike: My first one is that net neutrality is going to take a much bigger stage this year. I think part of the reason I say this is because right now we’re starting to see Netflix, for example, is paying service providers for higher bandwith to serve their content out to people faster. I saw a study that showed their content delivery speed has increased by fifty percent since the beginning of the year, and if you look back at what Netflix has done, they’ve made deals with a lot of the major providers that will essentially help serve their content faster. And I don’t think that that bodes well for the startup world in general. I think there’s a lot of concerns around that. I mean, it works great for Netflix, and I’m sure that the ISPs are very happy that they’re getting more money in their pockets to help pay for upgrades, but I don’t necessarily think that they’re actually going to be doing a lot of the upgrades that they maybe promised to have.
[16:55] So it concerns me a little bit that there’s also people in congress who are talking about net neutrality, and when you listen to them talk they clearly have absolutely no idea what net neutrality meant in any historical form. That’s worrisome. That’s scary, because these people are supposedly the ones who are making the laws. I mean really it’s probably the lobbyists who are putting money in their pockets, but at the same time, it’s just a scary thing to look at. So I think that it’s going to become a much bigger deal this year.
[17:20] Rob: My next prediction is that video ads – and mostly I’m thinking about YouTube ads, but I’m sure there are some other platforms that’ll have the volume – that they will be a big opportunity for cheap clicks in 2015. I think this is a green field area, and not a lot of people are doing it. It’s kind of hard to come up with a video, and there’s just not a lot of competition for it in the advertiser space right now. So I’m hearing the rumblings, and I’m starting to dip my toe in these waters as well because right now it is cheaper clicks.
[17:51] And if Google would kind of get its act together a little bit with retargeting – because the YouTube retargeting is really poor. I just want to be able to put a pixel on my website, and then if someone visits, be able to have an ad shown to them on YouTube next time they visit, but it doesn’t work like that. You’d only retarget your YouTube video if someone has visited your YouTube channel or watched your YouTube video in the past or something, and since I don’t have any presence on YouTube that is completely useless to me. But if they actually did some real retargeting like Facebook and the web allows us to do, this could potentially be a pretty big win for Google.
[18:27] Mike: My second prediction is that the number of startups in the wearables category is going to skyrocket. And I say wearables not just in terms of the hardware that’s coming out but also the number of software startups that are going to start to come out and try and offer services around integrating data back and forth between the different wearables, offering dashboarding technology and social sharing of people’s accomplishments and things like that. I think if you look at some of the apps that are out there right now like MyFitnessPal and Lose It! and things like that there is some of that stuff that is out there now, but it doesn’t necessarily integrate with as much hardware as I see coming out. And I just see a huge opportunity for people to get in there and start connecting all of the different devices. Because if you look at some of those different providers right now they work with a handful of devices, and there are a lot of devices that are coming out.
[19:16] Rob: Yeah, and wearables are blowing up. I mean I think this is already starting. We have fitness bands, a lot of people are wearing. We also have the watch, watches that are coming out. We have glasses like Google Glass with headset displays. There’s even this jewelry coming out that can do- like rings and bracelets that can do minor notifications. There’s shoe attachments that I’ve heard of that are way more accurate at being a pedometer. There’s a lot of stuff that this category is set to blow up over the next several years.
[19:42] My next prediction is that virtual reality will actually be a hit with the early adopter set in 2015. I don’t think that all of us are going to own a virtual reality headset in 2015, and the promise of virtual reality has been floating around for twenty plus years. It’s like artificial intelligence, right? It’s the promise that never seems to come to fruition. But I think in 2015 the early adopter set is going to make it work and that probably as 2016 rolls around that more and more of us will have these. They’re basically inexpensive consumer level VR headsets. Samsung just released a $200 headset. It only works with, I think it’s the Note 4 phone, but that’s kind of their first foray into it. I would consider it like a post-beta product but not quite ready for production, and they kind of want to dip their toe in the water. And I think 2015 is going to be when a lot of the legitimate VR headsets start coming out and we really start seeing what they can be used for and whether VR headsets are going to only be for gaming? Will we use them in video conferencing? You know, it’d be interesting to have a 3D view of everyone instead it’s not just these flat images. Would that be more engaging? We don’t know yet because everyone doesn’t have them. So I think there’s a lot of potential for it in the coming year.
[20:55] Mike: Well, that’ll be interesting to see with the Facebook Rift.
[20:57] Rob: Yeah, indeed. Yeah. Oculus, right? Yeah, and I was actually going to say that with my Kickstarter prediction I said that they would have a major multi-million dollar failure. They didn’t have that with the Rift because it raised the money and was delivering the product, but Facebook’s acquisition of them raised a pretty big stink, right? The question of like why did all these people back the Kickstarter if they were just going to take a billion dollars from Facebook? So that was I guess a controversy around them.
[21:22] Mike: Well, my next prediction is that Google is going to screw all bootstrap startups, and there’s absolutely nothing we can do about it. And I don’t have any details about this, I just have this feeling that there’s going to be something that they do, and it’s going to go probably much further than they’ve gone in the past, and basically they’re just going to screw anyone who’s doing internet marketing if you don’t do things the way that you want them to do them. I just don’t trust them anymore.
[21:44] Rob: What could this possibly be? They’ve already taken away all of our organic keywords, the ad rates continue to increase as competition goes up. What else could they do, Mike?
[21:53] Mike: I think that they could probably move much more towards basically forcing you to almost pay for rankings. Just the amount of data that they have and the strides that they’ve have made towards pushing people to pay for paid advertising, it just makes me wonder about when is the day going to come where they’re going to say, “Well, you know what? We’re just going to kind of flip the switch, and half the page is going to be ads for whatever it was that you searched for, and if you want to go to an organic search, you’re going to have to go to this other place over here.
[22:24] Otherwise it’s all going to be all paid advertisements for specifically what it is that you’re looking for.” I think they would be able to make a pretty solid argument that, “Well, if you search for this then clearly you want this particular type of product or this particular type of information, and there’s people who are willing to pay to put it in front of you.” So I can see them going in that direction.
[22:43] Rob: My next prediction is that we will see our first sub $100 a year consumer-level five terrabyte cloud storage service. Dropbox “ten Xed” the amount of storage they give you just a couple months ago. It was 100 gigs for a long time and they just increased that to a terrabyte, but I think we’re going to see five terrabytes within 2015, and that’ll be cool.
[23:07] Mike: Well, my next prediction is that Google Glass isn’t going to go anywhere fast.
[23:11] Rob: To think that Google Glass is not going anywhere fast is like- that’s it. I think the last nail in Google Glass’s coffin was a few months ago. It’s done already. I mean, is anybody- they haven’t done anything with it. They haven’t done any new releases, they’re not promoting it.
[23:24] Mike: I think the issue is that they’re trying to find good use cases for it. And I think there are definitely some really good use cases for it, but the problem is that they’re not mainstream uses. There’s no giant market there that I can think of that “Google Glass solves this whole slew of problems and it would be generally useful for just about everybody,” and I just don’t see that.
[23:44] Rob: And do you predict the same for the heads up display contact lenses that they are looking at? I’ve heard Google is researching this as well as some other companies. If they replace the dorky looking glasses with actual contacts so it’s much less visible, do you think that that could have legs?
[24:00] Mike: No, not really. I don’t see it happening. You still have no good way to interact with it, and that’s the problem. You don’t have a good input device. And unless it can start reading your brain waves to figure out what you’re thinking of to be able to modify– like move things around on the interface while you’re looking at it or something like that — that’d be totally different. But still that would take a pretty significant learning curve. There’s a huge amount of engineering that would need to go into that, and I don’t see that happening anywhere in the near future. So unless they come out with like a radically new input mechanism for directing or controlling these devices, I don’t think that it makes a difference.
[24:37] Rob: What if voice control got better?
[24:39] Mike: The thing is you can use voice control for your phone right now, and I don’t particularly use it. I use it when I’m driving. I don’t see most people out there talking to their phones if they’re trying to get things done. They’ll tap into it. They’ll type. They’ll use the keyboard. The software works reasonably well, but I don’t think people feel comfortable talking to their devices and asking it for information. I think they’d rather just type it in.
[25:02] Rob: My fifth and final prediction for 2015 is that we will start to see 3D printers in the houses of our early adopter friends. So I don’t think we’ll see mass adoption by the end of 2015, but I do think that our kids are definitely going to grow up seeing 3D printers potentially in our houses in the next couple years and definitely with our early adopter geeky tech friends such as myself. We’ll have a 3D printer in 2015.
[25:29] Mike: My last prediction is that cloud platforms and services are going to be generally viewed as a commodity by the end of the year, and there’s not going to be a lot of differentiation between them other than brand identity. So you’ll have the Rackspace cloud and the Microsoft cloud and the Amazon cloud, and if you take a look at the services themselves those different platforms offer you’re not going to see a whole lot of difference between them, and people are going to start associating themselves with a particular brand as opposed to going with one of them because of the specific services that they offer. So storage, queues, storing video – that sort of stuff – people are just going to use whatever cloud they happen to like the vendor of.
[26:10] Rob: Is that not the case right now? Because like when I went to look for hosting I could have gone with Rackspace or Amazon, and I picked Amazon for brand identity and because some other people were using it, frankly. But is there that much differentiation now that you think is going to change in the next twelve months?
[26:27] Mike: By “services” I don’t necessarily mean like hosting. Like Amazon Web Services, they have all these different services you can use, and hosting is just one of them. The same thing with Azure. When Azure started out it was they had hosted servers that you could use, but then they started adding in Linux and all these other distributions that you could use in addition to the Microsoft operating systems. And then they started adding in a lot of the things that Amazon had already been offering in terms of block storage and things like that. And Rackspace has kind of been doing the same thing kind of the whole time with their open stack technology. And I think that over time what we’re seeing is that the services themselves that they’re offering, at this point, they’re just competing on price. And it almost doesn’t matter which service you go through or which vendor you buy from; you’re going to get almost identical services from each of them.
[27:18] Rob: So we’re interested in hearing your thoughts on our predictions for 2015. You can tweet us at @robwalling and @SingleFounder. And if you have a question for us, call our voicemail number at 1-888-801-9690 or email us at questions@startupsfortherestofus.com. Our theme music is an excerpt from “We’re Outta Control” by Moot used under Creative Commons. Subscribe to us on iTunes by searching for “startups,” and visit startupsfortherestofus.com for a full transcript of each episode. Thanks for listening. We’ll see you next time.
Episode 214 | Our Goals for 2015
Show Notes
Transcript
[00:00] Rob: In this episode of “Startups for the Rest of Us,” Mike and I discuss our goals for 2015. This is “Startups for the Rest of Us” Episode 214.
[00:08] Music
[00:15] Welcome to “Startups for the Rest of Us,” the podcast that helps developers, designers and entrepreneurs be awesome at launching software products, whether you’ve built your first product or you’re just thinking about it. I’m Rob.
[00:24] Mike: And I’m Mike.
[00:25] Rob: And we’re here to share our experiences to help you avoid the same mistakes we’ve made. So what’s the word this week Mike?
[00:30] Mike: I’ve been running a little bit of an experiment lately. I’m not really a huge fan of time tracking software of pretty much any kind, but I’ve started using Toggle, it’s T-O-G-G-L. But I started to realize that I felt like I was spending a lot of time on things that didn’t necessarily matter, and I was starting to wonder where all my time was being spent. Not just with my time, but with my productivity in general. And what I found was just the very act of tracking of some of that time, and mentally calculating, okay, what category does this go in, it’s been a good experiment so far. I’ve only been running it for about a week.
[01:04] Rob: I’m a big fan of time-tracking. And ever since back in my days of consulting, you know, it becomes a habit at that point, because you have to report invoices and such. But even after that, when I was doing my own stuff, I would track my time to figure out which apps I was spending the most time on. And then at the end of the month, I used to do a dollar per hour, per app. So I would see which particular app that I owned was making me not very much money per hour and others which were making more. So I agree with you, there’s a discipline to it, there’s a little bit of an annoyance, because it feels like bean counting, but I find that the data you get out of it is more than worth it.
[01:38] And also, the fact that it makes you think about what you’re doing all the time, because you have to basically categorize that somewhere. Frankly, it’s a discipline I’ve fallen out of and it’s probably something I should look at again. I actually asked my guys, the developers I work with, to track their time, even though we’re all salaried employees. I asked them to track it and I said, I don’t need to see it, but I think it’s a good discipline for you to have.
[02:00] Mike: And I found that there’s certain things where business overhead for example, I don’t get anything out of that, dealing with financial stuff or learning about new things for the business. I don’t necessarily get anything out of it, but there’s no specific ROI for them. But I do find that I’m spending time on some of that stuff, and it’s just like, ugh, is there any way I could start cutting this out so that I can work on things that are worth more. So that’s what I found to be the most useful. And then obviously, because of AuditShark and the Academy and my consulting business, all those different things, there’s time spent there and I’m just trying to figure out how to reallocate most of it, which is pretty cool. How about you, what have you been up to?
[02:39] Rob: So I launched my startup audio documentary, it’s called “Launch.” And so far it’s received a warm reception. I’ve been pretty happy with the feedback I’ve been getting on it. You mentioned you’ve listened to part of it.
[02:51] Mike: Yeah, I’ve listened to a little bit over an hour so far.
[02:54] Rob: Got it. So you’re right at the point where we start questioning what we’re building and why and who we’re building it for.
[03:00] Mike: Yes, yup.
[03:02] Rob: So there’s some good ups and downs. I re-listened to it, just because I haven’t listened to it in a month or so. And since it went live, I kind of want it to be fresh. It’s called “Launch. A Startup Documentary.” And it’s basically a two-hour audio documentary of building and launching Drip with myself and my lead developer Derek. You can find that at startupstoriespodcast.com or you can download it at iTunes if you just search for Launch Documentary. It should come up in the top one or two. How about you, what else is going on?
[03:29] Mike: It’s getting towards the end of the year, and one of the things that I was thinking about a couple of weeks ago was kind of what I wanted to do for next year. It reminded me of a conversation that I had with Heaton where he had asked me why do I do all the different things I do, because I have a couple of different businesses and several different products. And he was asking me kind of a matter of factly, why is it that you do all these different things. I was like, you know, I like to do a lot of different things. If I work on the same thing for too long, I get bored. New Year’s is coming up, are there any New Year’s resolutions that I have. Why do I have to wait until New Year’s to start doing some of this stuff? So about probably three or four days ago, I started figuring out what I wanted to do for some month-long experiments for life and business and things like that. And the first one that I’m doing is going to the gym every single day with one day off a week for a month to see if I’m actually going to follow through with something like that.
[04:22] Rob: Nice, well, that’s a good way to build a habit if you want to.
[04:24] Mike: I was three days into it and on the third day, it was probably about 7:00, 8:00 at night, and I’m like, oh, I really don’t want to go to the gym, but I still went. It was 9:00 at night and I got to the gym and I worked out for an hour and I went home. It was definitely difficult to get in there.
[04:40] Rob: I’m curious, if Heaton was asking why do you do all the things you do, was he asking you for like what is your single motivating factor that gets you to do everything, or was he saying why do you do so many things instead of focusing on one?
[04:53] Mike: I think it was more out of just idle curiosity, you know, why do you do all these different things?
[04:56] Rob: Got it.
[04:57] Mike: It’s not often that you get asked why is it that you do what you do.
[05:00] Rob: I know. And it’s hard to find a satisfactory answer to, to be honest for me. I think that’s probably something I want to find a better answer to, is like why do you do so many things? And I have reasons I can rattle off, but I think deep down at the core, I want to really know that because doing multiple things means you don’t do them nearly as well as if you were just focused on one. And yet I’m doing the same thing right? I mean, I also run Microconf and have Micropreneur.com and the podcasts and startups and a book and all this stuff, so that’s something I actually, I’m taking a retreat here in about a month and I think that’s going to be one question for me, is whether or not I want to continue doing all these things, why I do them and if I should continue to.
[05:39] Mike: Yeah, that’s a question I have to answer for myself as well.
[05:42] Rob: So hey, have you been listening to the “How to start a startup” podcast from Y Combinator?
[05:47] Mike: I have not.
[05:48] Rob: Okay, so I mentioned it in the last episode. And it’s a Stanford course that they’re basically releasing as a podcast. And I started listening to it, and I’m maybe four or five lectures in. So far the first lecture was decent and then the other ones, it is so geared, it’s Y.C., so it makes sense. But it’s so geared towards billion dollar businesses that I’m struggling to pull things out of it that apply to bootstrappers. At this point, I’m not sure I’d recommend it to you if you’re bootstrapping, because all it’s serving to do for me right now is to distract me. In terms of, their talking about these really sexy big businesses and raising all this money and changing the world, and it gets you all excited, you know. It’s like when you watch “The Social Network” or you read the Steve Jobs biography or “Hatching Twitter,” I get super excited and I think why am I doing stuff so small? Why aren’t I thinking big? But in reality, there’s a reason that I’m doing stuff so small, and there’s a reason why I’m not thinking that big, and it’s because I value my lifestyle, and I value having time with my family and being in control of my time and all these things. And so, I think if you’re susceptible to that, to kind of the influence of listening to these things and getting pulled off your core mission.
[06:55] If you’re core mission is to really have time, income and mobility, then I would say you may not want to listen to this. Even though it’s good stuff and it’s interesting interviews. And then the last thing I want to point out today is if you haven’t stopped by startupsbytherestofus.com/greatesthits, you should check it out. We put together a page of our greatest hits. I think we’ve chosen maybe 20 or 30 and are based on download popularity, as well as our favorites. We need to update a little bit, it only goes through episode, I think 179, so we have 20 or 30 we have to cull through and choose a few out. But if you’ve only been listening for the last 50 or 100 episodes, there’s a lot of episodes before that I think you’ll definitely want to check out.
[07:34] Music
[07:37] Rob: Today, we are looking back at our goals that we talked about a year ago. So we’re reviewing our 2014 goals and then we’re going to set our goals for 2015. And I was thinking this year we can do a little scoring thing. You could say, I got on that goal, I got a zero, I got a one, if you achieved it, or I got a half point, if you kind of achieved it.
[07:57] Mike: Can we not. So my first goal was to go full-time on AuditShark. And I guess I would say that I achieved that. I did that back in, what was it, July, yeah, about five months ago. I’ll say 0.75.
[08:12] Rob: Nice.
[08:12] Mike: We’ll go with 75% if that makes you feel better about it. I would say that, mainly because it’s not a full-time income.
[08:19] Rob: And has it changed your life, full-time at AuditShark? Because a lot of people’s goals are to go full-time on their product.
[08:25] Mike: I would say my life is considerably different in a good way. But I would say it’s not necessarily because I went full-time at AuditShark, it’s because I quit consulting.
[08:33] Rob: So my first goal from 2014 was to 5x Drip’s revenue from December of 2014. And I did not achieve that. I was looking at about 3.1x of the December revenue. So I’m going to give myself a half a point. The biggest reason we weren’t able to do that was because Drip was not ready to scale in December of last year like I thought it was. And if fact, if you listen to that launch documentary, you’ll hear that we basically launched people like it, but then it took us another five months of development to really find that product market fit to where it could start scaling up. And that wasn’t really until June or July.
[09:13] Mike: Well, my next one was finish my security book. And I’d have to give myself a zero on this one.
[09:19] Rob: Did you start your security book?
[09:21] Mike: You know, I started putting one together and I probably only wrote a couple of chapters, and I just remember thinking to myself, how can I possibly put together something like this that isn’t going to be completely and utterly boring.
[09:35] Rob: To you or to the reader?
[09:37] Mike: I would say both. So yeah, I kind of bailed on that, but I did start on something called, “The Single Founder Handbook.” Singlefounderhandbook.com is going to be where I’m going to be launching that. It’s going to be more about how to build and structure a business in such a way that it’s something that you’re interested in doing long term. And I say that because I’ve talked to a bunch of people who, they’re goal was to build a business and then they built a business, and then they realized kind of after the fact that they didn’t actually build themselves a business, they built themselves a job, and they don’t like their job. So now they’ve got this “asset” that they don’t actually like coming into work and doing any work on it, but it pays the bills. And they’d like to go do something else, but they really can’t because they’re stuck in that, so it’s not like a job where you can take a couple of weeks off here and there and then go do something else.
[10:25] It’s like if you’re not working on your own business, then it’s probably tanking. And a lot of people that I’ve talked to are kind of in that position. So I’m really looking at putting together something that addresses those types of things and talks about how to structure the business so that it allows you to do the things that you want to do rather than forcing you into a situation where you have to do certain things or things go haywire.
[10:47] Rob: Cool. So my second goal for 2014 was to get HitTail back on track in the next 60 days. So that was within 60 days of last December. And if you recall, Google’s Not provided was wreaking havoc on HitTail and it was bleeding customers, because it wasn’t able to provide nearly as much value. And I did get it back on track although it took me probably 90 days, but it was a big scramble to basically get another source of data. Were now reporting from Google Webmaster Tools instead of relying on the Google query string right? Because they don’t provide keywords anymore. And that essentially got HitTail back on track. So I feel good about that one. We also rewrote HitTail in Rails this year, meaning that even if it had another problem, I could have a developer fix it instead of me.
[11:31] Mike: My third goal was to get back to blogging and writing. The goal I set for myself was 26 blog posts or email newsletters for the year. And I ran into a situation where things were kind of just going haywire within MailChimp and I kind of got frustrated with the whole thing. And I felt like it got in the way of me actually writing and posting things. I mean, I still kept writing to some extent. I’d probably give myself maybe half a point for this, but I definitely didn’t come close to the 26 blog posts that I wanted to. That said, about probably a week or two ago, I finally got everything from my blog moved out of MailChimp and into Drip. So now that all of that stuff is straightened out, hopefully it’ll make it easier for me to kind of overcome those mental hurdles associated with that. And I have started writing again.
[12:16] Rob: Yeah, this is a tough one because I admire the goal when you said it last December, but I remember thinking this is a tough one to adhere to given all the other stuff you’re trying to do as well. Writing is just a time consuming thing, and unless it’s a major driver of revenue or it’s a major focus for you, it’s hard to get a blog post out every week or two.
[12:37] Mike: This is part of the reason why I’m giving myself half a point on this is because part of this was just about writing more. And I’ve kind of channeled those writing efforts into writing in the Single Founder Handbook, not into the blog. So I’m still writing, it’s just not all going into the blog. The goal was to write for the blog and for the email newsletter, but not a lot of that’s going in there. I mean, I probably will cross promote or cross post some of that, so I can reuse some of the content a little bit, but that kind of factors into it as well.
[13:04] Rob: So my third goal for 2014 was to throw two MicroConfs with you of course, in a sustainable manner. And the sustainable manner part just meant throw two MicroConfs without spending a bazillion hours on it. And I think we definitely did that in April because we hired a coordinator named Xander who took a ton of stuff off our plates. I think we mostly did that in October because we were working with Dan Taylor on it. There were still enough stuff in the October Prague Conference that fell through that I felt like it’s not super sustainable. You and I are obviously talking about ways to improve on that. But overall, I think this one’s mostly a full point.
[13:42] Mike: So my next one was to take an extended vacation. And I would give myself a half a point on this. I did not take an extended vacation of two-plus weeks which was kind of the goal. But I have taken a week-long vacation there. And I did get some extra time in for some personal time away for my retreat back in August too.
[13:59] Rob: Very nice. My fourth goal was to re-launch micropreneur.com. And this was really more about launching the forms and getting a venue where people could continue to share and interact because if the forms in micropreneur.com were, as we said, their WordPress, and they were getting old and there was a bunch of issues with them. And we just did that here in the last month. We moved over to a new platform called Founder Café. And so far things have been going really well. Lots of discussions, and I’ve been in there every day or two interacting. So I would give this one a full point.
[14:30] Mike: My fifth goal was to make a conscious effort to improve my health. I have a very specific goal in here which was to lose 2.5% of BMI by MicroConf which was about 10 pounds. And if I remember correctly, I did do that. I would say that that’s going really well. Of course, with my month of change starting a couple of days ago with this, that would go through December, and I would expect to be able to drop some more weight and improve my health even further. But I’ve noticed that kind of since the June-July timeframe, when I stopped consulting and stopped being on the road, and stopped eating out all the time, my health has been dramatically changed for the better. And not just my physical health, but my mental health as well.
[15:08] Rob: So my fifth goal from last year was only an honorable mention. I did this very much on purpose, because before I set my goals for last year, I had to retreat and I looked at what I thought I could realistically do in 2014. And the previous four goals I mentioned is what I had down. The fifth goal I put as an honorable mention because I genuinely didn’t think I could get to it and I would have time even to start it, but that I could see it coming up in 2015 and that if I had time in 2014, it was something I would do. And that goal was to write a second edition of “Start Small, Stay Small.” And frankly, as time goes on, second edition is like a loose term, because so much has changed that it would kind of be a complete re-write. It would almost be like writing a brand new book. So I didn’t get that one done, obviously get zero points for that. But not feeling too bad about it, because I didn’t think that I would. Yeah, it’s interesting, when you write such a tactical book like that, the stuff just doesn’t stick around forever.
[16:02] What I did notice, because I went back through, and I have not picked up a copy of my book in years. And I picked it up the other day and I noticed about probably 60-70% of the info is mindset and it’s thought-process and that kind of stuff. And that stuff, I probably wouldn’t have to re-write. So it really would be where I go into the keyword planner and the super numeric stuff, would certainly have to change. So let’s dive into our 2015 goals. Looks like we each have five.
[16:30] Mike: Well, I think the first goal that I have is to run a series of life experiments. The first month of change is going to be going to the gym almost every day. But there’s some other things that I want to try as well. So for example, one of the things that I always kind of wanted to do was to become an early riser. And I know that’s going to be something that is going to take a while to do, because I am not a morning person by any stretch of the imagination. So I’m going to try and get up early every day for a month and see how that goes. Part of that is also getting enough sleep at night, and then there’s, I’d like to try maybe going vegetarian for a month. I haven’t fully worked out the entire year yet. But I just want to try a bunch of different things.
[17:07] Rob: So to summarize, it sounds like you want to try 12 different one-month experiments.
[17:11] Mike: Yeah.
[17:12] Rob: There is, if you haven’t read Steve Pavlina’s article about becoming an early riser, it’s the one, because you and I are both not morning people, and that’s the one early riser article that has actually ever worked for me. So I loved his approach. It’s a weird approach, makes you feel silly, but do it and at least for me, it worked really well. Before I get to my first goal of 2015, I have a caveat here. Typically, before we’ve done these goal episodes, I’m very certain about my goals because I’ve gone on a retreat and I’ve spent 48 hour solid thinking about it somewhere. I have not done that this year. I feel generally good about these goals, but I have not put them to the real fire test of saying, do I actually think these are all completely realistic and have I committed to these.
[17:57] But giving about 30 minutes to think about it, this is what I put together, and this is basically going to be my starting point when I start my retreat and really think though each of these. So I think it’s probably a reasonably accurate picture of what I’ll do in 2015. With that, my first goal in 2015 is to 2.5x Drip’s revenue. It’s something that I think is ambitious, but I certainly think it’s within the realm of possibility.
[18:21] Mike: One of my goals is to spend some dedicated time each month kind of looking at where I’ve spend my time and figure out how to create more systems that I can put in place that will allow me to spend less time doing those things on a continuing basis. And this kind of talks back to a little bit of what we talked about earlier, about time-tracking is I need to know where I’m spending my time in order to be able to systemize things so that I get myself out of doing those things on a regular basis. So obviously, time-tracking is going to factor into that pretty heavily, but I also need to make sure that I’m dedicating some time at the end of each month to kind of look back and say where did I spend my time, where did things go wrong, and where is it that I can become more efficient in the future by automating certain things.
[19:03] Rob: My second goal for 2015 is to get back to the point where I can choose what I want to work on and when I want to work on it. I feel like over the last year, I feel like focusing so much on Drip and growth and all this stuff, that there are times that I have to do a lot of things that I am not particularly choosing to do, but have to get done for the businesses-sake and for growth’s sake. And while I want to continue to focus on Drip, and Drip is absolutely my number one priority and I’m all-in on it, I do want to find a place where I have perhaps one more person hired and I can have them take over some of the sales, some of the marketing and the stuff that I’m kind of over.
[19:44] The stuff that I’ve done enough, that I’m not learning new stuff, that’s easy to systematize, that I’m still doing, and that I can move on to the things that are teaching me, that I’m learning from, and frankly are the things that I want to work on. So that’s a big goal for me this year, is to get back to that point, because I’ve been there. I was there for the previous two years of just doing really fun stuff most of the time and having a lot of choice on what I worked on, and I definitely lost some of that in 2014.
[20:08] Mike: My third goal is to build a better system for maintaining the inbox to zero. And what I, I think I’m like a lot of people where I use my inbox as a glorified to do list. And at one point, there were emails in there that were more than a year old. And at that point, of course, it’s just, you’re not going to do anything with that at that point. I’ve still got emails that are less than a month old in my mailbox, and those are the things that I need to figure out a mechanism for getting them out of there and on to a task list that they’re not in my mailbox. What I did realize, I got to inbox zero a couple of times, and what I realized that knowing that I had no emails in my inbox, I didn’t have to think about it. I never had to sit there and say, oh, I need to check my email because there’s all this stuff that is in there that’s on my list of things to do and I need to kind of refresh my memory about what’s on that list. But I realized that when I didn’t have anything in my inbox, I could just completely ignore it, and it was just a huge weight off my shoulders, and it was a nice stress reliever.
[21:10] Rob: When you find a system for maintaining inbox zero, you need to tell it to me, because I want to do it too. All right, so my third goal for 2015 is to host two more MicroConfs in an even more sustainable manner. I don’t know, maybe we should toss this one out. Rather than a goal, it’s like part of my plan. It’s like part of what I see taking up a lot of my time in the next year, and I kind of have to slot that out.
[21:36] Mike: Well my fourth goal is to do a better job of systemizing my different revenue streams. And I jump around a lot between the different things that I have going on. And I feel like a lot of the jumping around, back and forth, between the different products and revenue streams is that it’s too haphazard. I feel like I’m constantly jumping from fire to fire as opposed to like having cold calculations about, I’m going to do this this week and then next week I’m going to do that, and having a solid plan in place for doing things versus just jumping from fire to fire. And I think that that’s definitely something I can do a lot better with that I’m just not handling very well right now.
[22:14] Rob: My fourth goal is to launch another podcast. I think that 2015 is the year that that will happen. So keep your ears peeled. I’ll obviously be talking about that process as it goes. And no, it will not be a competitor to “Startups for the Rest of Us.” It’s not going to be Startups for the Rest of the Rest of Us in case you were wondering. It’ll be in the startup space, and I wanted to look at like mindset stuff, psychology. It could be with a certain significant other of mine who has done a lot of talks about this topic. Hint, hint, if you’ve come to MicroConf and you’ve seen my wife speak. Frankly, she is the one who started pushing it forward and she was going to do it on her own. And I said, boy, I’d really like to be part of that because I feel like I have to say on it.
[22:55] Mike: Very cool. The fifth goal that I have for this coming year, is to keep up my writing habit. And I think with the progress of the Single Founder Handbook and all the issues that have been straightened out with my email newsletter, I think that will happen. Again, it kind of goes back to making sure that I set aside dedicated time to do different things and I’m still trying to figure out how to put things on my weekly task list that in such a way that I know that I can get to them, as opposed to building a task list for the week and then I get to the end of the week and a lot of stuff is not done and get it pushed to the next week. And then you end up with this flow of tasks that have been overflowing for two, three or four weeks. And obviously at that point, you’re just overloaded and things are just not getting done the way that they need to.
[23:37] Rob: So when you say keep up your writing habit, what specifically do you hope to produce?
[23:43] Mike: I want to put out a new blog post at least twice a month. So that kind of goes back to, or at least the equivalent, not necessarily a full blog post that’s published or anything. I know, for example, that Nathan Berry was doing a thousand words a day, which as long as you sit down and dedicate the time to starting writing, then you’re fine. But I think that dedicating time every single day for me is probably not an option right now, just because I don’t have systems in place for how I’m going to be working on things, what I’m going to working on it any given day. Part of that writing habit is going to kind of go back to how I manage that process. I think that the equivalent of a couple of blog posts on a monthly basis would be fine. If I dedicated some time to put it into my Single Founder Handbook, then I would count that towards that habit.
[24:31] Rob: Got it. Well, my fifth and final goal, and this one pains me so much to say, I’m really having a tough time coming out in public with this, but in 2015, I think I might write another book. That may be the second edition of “Start Small, Stay Small.” It may be something else. I have some other ideas in my head. Writing books is such a time-consuming and painful process, but the time has come where I need to do that. I’ve hit kind of the next stage of my career since I wrote the last book, and I have so much to say, that I feel like I need to put on paper. So I don’t even make this an honorable mention and it’s going to hurt if I get to the end of next year and I haven’t done it, but especially given everything else that I’ve listed of growing Drip and launching a podcast and returning to the point where I can choose what I want to work on, fitting this one is going to be a challenge.
[25:21] Mike: Well, I think that about wraps us up. If you have a question for us, you can call it in to our voicemail number at 1-888-801-9690, or email it us at questions@startupsfortherestofus.com. And I do want to say thanks because I know a lot of people probably turned off by now. But I do want to say thanks to everybody who has emailed in a bunch of podcast topic ideas for us, those have been really helpful. So we’ll be adding those to our queues and working through them. But just to continue on, our theme music is an excerpt from “We’re out of control” by MoOt used under Creative Commons. Subscribe to us in iTunes by searching for startups. And visit startupsfortherestofus.com for a full transcript of each episode. Thanks for listening and we’ll see you next time.
Episode 213 | How to Plan a Conference
Show Notes
Transcript
[00:00] Mike: In this episode of Startups for the Rest of Us, Rob and I are going to talk about how to plan a conference. This is Startups for the Rest of Us, episode 213.
[00:06] Music
[00:13] Welcome to Startups for the Rest of Us, the podcast that helps developers and entrepreneurs get awesome at launching software products, whether you’re developing your first product or you’re just thinking about it. I’m Mike.
[00:21] Rob: I’m Rob.
[00:22] Mike: We’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s the word this week, Rob?
[00:26] Rob: The word is, startupstoriespodcast.com or go into iTunes and search for the word “launch”, you may need to put “launch documentary”. Two words.But this is that two hour audio documentary that covers nine months of building Drip and then we recorded an epilogue about a year later. So it’s a span of about twenty-one months of recorded audio and it’s broken down into just over two hours. It goes live today; this podcast comes out.
[00:54] Mike: Very cool.
[00:55] Rob: I’m excited about it. I spent a lot of time editing it on the plane versus on my last trip. I feel good about it. I feel like it tells the story pretty well and it’s produced. I put music in…
[01:04] Mike: That’s neat, that will be interesting to listen to.
[01:06] Rob: How about you? What’s going on?
[01:07] Mike: We have an open call for new podcast episode ideas that I put out on Twitter yesterday. So that kind of goes for any of our listeners, if you have questions that you want us to answer or show ideas, shoot us an email. We’d love to take a look at what your thoughts are and what you guys are interested in hearing from us about. After 213 episodes, it does get a little difficult to come up with new episodes every week. So we would really appreciate any ideas and thoughts you guys have and ultimately as part of this podcast is for you guys anyway. Make sure you send in your ideas and we’ll take a look and see what we can bring out of it.
[01:39] Rob: Yes, for the first time in a long time, our question coffer is very low. We just have a handful of questions, so we would like to hear your thoughts. So what are we talking about today?
[01:50] Mike: Today we’re going to be talking about how to plan a conference. I think that part of this has come up primarily because we’ve had a lot of questions about what the dates are for the next MicroConf, and to be honest, we just don’t know yet. I thought it would be interesting to discuss what goes into planning MicroConf. I know there’s a bunch of people who come to MicroConf who also listen to the podcast. I thought it would be interesting to discuss kind of the dirty details of what goes down behind the scenes to plan the conference.
[02:14] Rob: Right, and we’ve received specific questions about that. Certain people either are thinking about throwing an event or wanting to know more about what goes on and they’ve asked us. We kind of have a quick conversation with them but I think that’s the idea here is to kind of document it.
[02:26] Mike: We’re not going to be talking about selling tickets. We’re really just going to be talking about the event logistics. The short of it for selling tickets, we simply use Eventbrite, it’s very easy to use. It makes selling tickets a lot easier, but obviously there’s a whole other side to selling tickets for an event that has to deal with marketing, leveraging an audience, getting people to the event, getting them to buy into it, especially the first time around. I think that’s enough of a conversation that we’re going to leave that out this time and focus solely on all the logistics and things you need to think about when you’re planning a large-scale event.
[03:01] Rob: One of the first things you need to think about is location and dates. What’s funny is, location actually needs to come first because from a location, then you go out on a hotel search. The first thing you need to think about is how long will a conference be, and potentially how many people you’re going to have. You may not know that up front, but you kind of have to name a number. Because if you are going to have a 300 or 400 person conference, there are certain cities and airports that have a really hard time supporting that. They just don’t have the open hotel rooms. So the size of your conference can impact where in the world you can have it.
[03:35] Mike: It’s also worth looking around quite a bit because the cost of the conference itself is just one factor. You also have to take into account the cost for the attendees to fly into that location, because there’s certain cities where it’s monumentally more expensive to go to that city at different times of the year than it is to go to other cities. We chose to have MicroConf in Vegas for a lot of different reasons, but one of the big ones is the cost. It’s not just the cost to us, it’s the cost to the attendees. There’s the cost of the conference itself, the cost of the hotels, the cost of the flights, that adds up. You have to be a little bit conscious of what the total cost of coming to the conference is. It’s not just the $200 or $500 or $1000 that you’re charging, it’s also the cost of the hotel, flight and everything else.
[04:23] Rob: Like you said, we’re really in tune with that. We pay a lot of attention to it and that’s one thing we prioritize highly when we are looking at new hotels. I don’t think either of us loves Vegas that much, but it is so cheap to get to. It’s pretty easy to get to from in the US. The hotels have really good deals. We’ve looked at holding it in eight or ten cities in the US and almost all of them are more expensive or harder to get to and the total cost is more for attendees, which is why we just haven’t done it. I’d love to do it in Boston or San Francisco but the hotels are going to be $300 a night and we would almost have to double ticket prices. We haven’t wanted to do that because we’re trying to get bootstrappers there and we don’t necessarily have a bazillion dollars to throw around.
[05:04] Mike: Once you’ve got the city and hotels narrowed down, you have to start considering which hotel you’re going to go with. Part of that has to do with what dates they have available. Just because you want to have the conference on certain dates of the year doesn’t mean that the hotel is actually going to be available on those dates. If you book far enough in advance, you can probably get those dates, but it also has a lot to do with the number of people that you’re expecting to have there.
[05:29] One thing you definitely have to be careful about is not under booking it. So if you decide that you’re going to try and get 100 people there and you only get 70 or 60 there, you can really be in a lot of trouble in terms of the financial side of it if you’re not able to get that number of people there. They typically have some sort of a food and beverage minimum that you have to come up with in order for them to make certain concessions about the rooms and the catering.
[05:53] Rob: Yes, and they also – you’re on the hook for covering the room cost, a minimum number of rooms in addition to the food and beverage minimum. The first year we had MicroConf, if you recall, Mike, we were on the hook for $10,000-$15,000, might have even been more than that. We had not sold enough tickets to even come close to covering that. I remember kind of having a panic moment that we were going to be paying for a bunch of rooms that weren’t rented out and some other stuff. So throwing a conference, especially if you’re going to get above 100 people and start to get into the 120s to 170s, if you don’t sell enough tickets, it can become a real financial issue. It can cost quite a bit of money. It can be a risky endeavor if you aren’t sure how many tickets you’re going to sell.
[06:34] Mike: So when you start looking at those dates, you have to decide what days of the week you want, as well. Especially when we were looking at hosting the conference in Vegas versus in Europe, we found in Europe it was substantially less expensive to have it on the weekend, whereas in Vegas it was substantially more to have it on the weekend. For several years of MicroConf in Vegas, and I don’t think we’re going to be changing this; we hosted it basically Sunday through Wednesday. Basically, a Sunday night evening event and then Monday and Tuesday. That was primarily driven by cost and then our first year over in Prague, we hosted it on a Saturday and Sunday. I don’t think that, although it was more cost effective, I don’t think it worked out in terms of the type of audience that we attracted. You definitely have to give some consideration to the type of people you’re going to attract by hosting it on certain days of the week.
[07:21] Rob: With MicroConf, we found that people who are self employed and are very serious about launching a business are willing to either take those two days off from their salaried gig if they still have one, or from their product business because they have a flexibility to do it. So we found it has resulted in kind of a higher quality or more serious group of attendees if we actually do it during the week. I don’t know if that would be the case with all conferences, but it’s definitely something to think about.
[07:46] Mike: The next thing you want to take a look at when considering the hotel is what sorts of concessions are they making on the total price and on the services that they’re offering. Are they flexible? For example, one thing we found in Vegas is most of the hotels have some sort of a resort fee. That’s something you have to be conscious of. In some places, they’ll let you waive it. They’ll say, “Okay, if you’re not going to go to the gym and spa area, we’ll waive this for them. But if they use the gym at all, we have to recharge this resort fee.” Then there’s certain hotels where it’s absolutely non-negotiable. They will not waive that fee.
[08:18] I think the one we’re actually looking at now, they have it tied to the WiFi access, the roaming WiFi throughout the hotel. So that’s a consideration for us. We don’t want to ask them to waive it because we want everybody to have that WiFi. But again, they didn’t actually let us have it as an option.
[08:34] Rob: Yes, which is a real bummer. We found that some hotels that are not owned by big corporations, those are the ones that tend to work with us because every year it’s a negotiation. You don’t want to pay rack rate when you go to start talking about this stuff, it’s all negotiable. The ones that are owned by these big corporations are really rigid and they won’t negotiate very much. They won’t give many concessions, meaning suite upgrades for your staff based on number of rooms that are booked, or discounts on audiovisual or food and that kind of stuff. That’s all been pretty negotiable with the hotels we’ve used thus far.
[09:08] Mike: The last thing you need to keep in mind with the hotel itself is, what is the final cost to the attendees of those hotel rooms? As Rob was saying before, if we hosted a conference in Boston, the rooms are going to be $300 a night. What we typically shoot for, for MicroConf in Vegas, is anywhere between $80 and about $120. $120 I think is a little on the high side. Of course, over the course of three or four days, that’s $400 or so. Very same thing, in Boston or San Francisco, $300 a night, you’re immediately going from $400 for the whole thing to $1200. That gets a little bit out of the price range of the type of audience we want to attract for MicroConf. You do have to be mindful of what the total cost is going to be for people, because some people are going to stay a little bit longer.
[09:53] Rob: So when you’re looking at hotels, one thing you have to think about is, what event space do they have? Because we found hotels that say they have event space, what they actually have is meeting space. There’s a difference, right? An event space is something with a high ceiling where you can get a stage in with a podium and a big projector. A meeting space tends to be eight to twelve-foot T-bar ceiling and, yes, you can have a podium and maybe some small screens but it’s very different. So depending on the type of event you want to have – if you’re going to have more than I’d say, seventy-five people, you really want some type of event space. That high ceiling gives your event a different feel.
[10:28] The first MicroConf in Prague, we had it in a smaller room, and it was more meeting space. We hadn’t seen the space before the event. For me, it was definitely not as classy. It just didn’t feel as big of an event as this year’s, where we did have high ceilings, or like we’ve had in Vegas. Think about ceiling height. You definitely want an elevated stage. That’s been another one that’s made a difference. Then you want a podium on that and you want at least one very large projector screen, sometimes two, and those are pretty expensive. The hotels rent the projectors to you at an exorbitant amount. We’re like, “If you pay for two days of it, you could buy the projector?” But that’s just the way it goes. If people can’t see, then it’s a problem, so you might just have to pay for two of those depending on the shape of the room.
[11:12] Mike: That’s a really good point you brought up about the cost of some of the different equipment that you’re renting. It’s like, we could buy a projector for that cost, but at the same time we’d be on the hook for bringing it, setting it up and everything else. In addition to that, what happens if in the middle of the conference, the thing breaks? Or the bulb blows? Then we have to go out and buy another one and we have to scramble, versus if we’re using the – whatever local event company they have, they’re supplying the equipment – they typically have spares right there on hand. So you don’t have to worry about it as much. Basically it just becomes a stress factor that you don’t have to worry about. In many cases, it really is just worth it to pay the money and say, “Okay, you guys deal with it.” You don’t want to be the one who’s on the hook for dealing with all those little technical glitches.
[11:59] Rob: Yes, that’s right. I don’t think most people realize how expensive everything is if you’re going to do this through a hotel. There are other ways to do it; I’ve seen people throw conferences at universities and you can get the space for free or for a low cost, especially if you give tickets to some students there. But then you have to provide everything. You need to figure out the sound, all the meals, there’s a lot that goes into that. That’s why we do it as hotels, as well so that people can all stay in the same place. It makes it convenient, but they’ll charge you for things like projectors or coffees. Don’t they charge us $68 for a gallon of coffee? Something like that, it’s outrageous. The lunches, it’s like a buffet lunch for $50-something per person. They’re giving us the event space for free, so that’s kind of how it winds up. Be prepared, if you’re going to do this, that the budget – there’s a reason conference tickets tend to be expensive. To do it right, it is not a cheap endeavor.
[12:53] Mike: You also have to make sure that you have at least a reasonably good sound system or sound engineers on site. The last thing you want to be doing is trying to deal with the hotel sound system when it’s not something you’re familiar with, if you didn’t set it up. You really need to have some sort of an onsite event staff that’s going to be handling that aspect of it for you, because you want the event to sound nice. You want the speakers to be able to come through loud and clear.
[13:17] At MicroConf, we actually have a sound engineer who’s there all the time, where if something goes wrong, he can fix it right on the spot. There’s been a couple of times where they’ve had sound issues – where either a microphone dies on us because the batteries are dead, or we have to swap one out because it’s not working right. There’s all these different problems that can come up. They’re all little things, but they can really seriously impact that quality level or the perceived quality level of the conference. Having those people there is extremely helpful.
[13:45] Rob: WiFi is the other thing – we spend, I think between $4000 and $5000 on each conference. That’s for two days of WiFi in the venue. It’s always been worth it. We only had one year we had some scattered issues and that was a real bummer, but every other year that cost, while it feels like a lot to pay, has always been worth it when you get 150, 170 attendees and they’re all able to connect to the internet.
[14:11] Mike: Well, even that year that we had problems, they brought in another WiFi access point for us. That was something they just did on the spot. It’s hard enough to deal with a conference, let alone technical glitches. So having them – it’s almost a no brainer if you start putting on a conference of any given size.
[14:26] Rob: I think the last part about the event space itself is to realize that you really don’t want a lot of extra space in that room. You kind of want there to be an energy of that room. I’ve been at conferences where the space is like two sizes too big, right? So you have a bunch of extra space, and the energy kind of just dissipates, either straight up or out the sides. You want people to be packed in just enough so that it feels like there’s a lot of people and like there’s a lot of energy in the space.
[14:53] Mike: So let’s talk about the evening events a little bit. For MicroConf, we run an evening event every night of the conference itself. Then we have, essentially, an evening reception the night before the conference starts. I think it’s important to have something every night; I don’t think you necessarily need to be the one who organizes it, but you do want to make plans for something. You don’t want to just say, “Okay, goodbye!” Especially at the end of the conference you want to have something for them, whether that is, you’re helping people organize into groups so they’re going out to dinner and you provide them with a list of places they can go. Or, you host something for them.
[15:25] I think that it’s just important to make sure that you are providing direction for people, so they know kind of what the expectations are. I think that if you’re just leaving people to the wolves, so to speak, and letting them decide on their own, it almost feels like you’re not taking care of them. You’re not paying attention to what their needs are as part of the conference. You do want the attendees to talk to each other; you do want them to interact. So providing a venue for them to interact at an evening event is extremely helpful in terms of them just getting more out of the conference, but also getting them talking to one another.
[15:55] Rob: Right, realizing that the hallway track is always worth at least as much as the speaking track itself – the first year at MicroConf, we didn’t have an evening event planned for the third, final night. We just figured people would kind of self-organize and as it turns out, that was the year Heaten Shaw spent like $900 in liquor at the hotel gift store and we all just lined up and carried it up to Andrew Warner’s suite. That became kind of the tradition of – we at MicroConf get together every night in some organized fashion, at some prearranged meeting place where everyone to gather is a big deal. Every night, because any time you skip a night, people want to be together. That’s why they’re there, why they’re taking time out of their week and why they’ve paid for the hotel.
[16:35] Being pretty deliberate about getting people together every night of a conference is a big one, including the welcome reception the night before the conference. I think that’s really important, because getting the social energy kick started before the conference itself starts is a big deal. When you get up on stage that first day, if you’re running this conference, you’ll feel the difference. When people are not connected, it’s harder to run the conference. But if people have reconnected and you feel like it’s a cohesive group, it makes a big difference.
[17:03] Mike: One of the things that we’ve discovered with our evening events is that, ours have gotten large enough that we actually want them to be outdoors. The reason for that is that sound travels. If you have it inside and you have enough people in a room, what happens is that the sound will reflect off the ceiling and comes back. It just makes it exponentially louder and by having it outside, that sound travels up and it doesn’t come back, which is really nice. I think we discovered that more by accident than anything else. By far, every single event that was outside has been far better. I know that you really can’t do this outside of Vegas, because Vegas is basically a desert, but it makes it so much easier to be able to do that event outside.
[17:42] Along with the noise factor is having low or no music at all. In Prague, this past year, we’d had one of the evening events at a bar in downtown Prague. It was so incredibly loud that people just didn’t enjoy it. There were people who left early because they wanted to go back to the hotel and hang out at the bar there. They couldn’t hear themselves talk. That’s definitely something to be mindful of. People are there to talk to one another and if you don’t provide them with an environment where they can talk to one another, they are going to leave.
[18:09] Rob: Last couple of things to keep in mind with evening events is to buy at least the first drink for everyone. The other thing is, to serve some kind of appetizers or dessert. Even if it’s a small quantity, everyone’s not going to eat it, but just to have something to munch on lying around helps.
[18:24] Mike: Along with the appetizers, something you also have to be mindful of is that different people have different dietary needs. So there are some people who are vegetarians, vegan, gluten free or have allergies to different types of foods. You have to be sensitive to those types of things and handle them more or less as exceptions. Basically, ask people, “Are there any dietary considerations that you have?” and we follow up with them to make sure that we’re able to meet those. We work with the hotel on those things. So for lunches, for the evening event appetizers and things like that, you want to make sure you’re taking those things into consideration because it may not be important to you, but it is important to your attendees. If you show them that you do care about those types of things, they’re going to be much more willing to come back and to tell other people, “Hey, I went to this event, these guys took care of me.” We’ve actually gotten emails back very recently about the MicroConf we just held in Europe – people who have emailed us and said, “Hey, I really appreciated the fact that you guys took care of me because of this.” It was just nice to see that it was noticed.
[19:23] Rob: So let’s talk about speakers. This can be a big part of your effort is actually recruiting good, solid speakers. I was talking to Dan and Ian at Tropical NBA when I was at DCBKK and one thing Dan had mentioned, which hadn’t necessarily occurred to me before, was just how hard it is to find people who are both practitioners and who can communicate, and communicate well onstage. It really is hard to find good speakers. There are only so many of them. So our way to find those folks is to seek warm introductions. We ask people if they know someone who is a speaker or who has spoken in the past, because once you’re throwing an event that has a lot of people attending it, you can’t necessarily have beginner speakers. That’s when you start doing stuff like attendee talks or having shorter talks with the beginner folks to see who fleshes out and who is able to take the main stage later.
[20:15] Mike: Yes, I definitely think addressing the quality of the speakers and establishing kind of a minimum bar is definitely something that you want to do at a large scale event. The last thing you want to do is put speakers up there who don’t resonate at all or clearly have issues speaking in front of a large group of people, because it just doesn’t come across well. Then you get this very, very wide range of speakers and people come away from the event thinking to themselves, “Oh, well I really liked this speaker and this speaker, but these other four or five, or whatever, I didn’t resonate with them. I didn’t find what they were talking about interesting. They just weren’t good speakers.” I think you want to raise the bar as far as you possibly can, but you want to do what you can to vet them. So that includes watching videos of all the talks that they’ve done, especially if they’re not a speaker that you’ve heard before or been able to see some of their videos.
[21:03] You want to take a look at their slides and see what it is they’re talking about, if it’s something you think is going to resonate with the audience. I’ve been to conferences and spoken at conferences where they want your slide deck up front so they can essentially help you tweak it. There’s other ones where they’re essentially just let you go and you can talk about whatever you want, and they’re not going to review it. I think the best thing to do is something in the middle. You kind of give people a lot of leeway if you’ve seen other talks that they’re done and you have a good sense they’ll do a good job just based on their previous work.
[21:34] Rob: Yes, there are two things a talk needs. It needs delivery and it needs a really good talk, like actual content of the talk. Most of the talks that fail have poor content or it’s not organized well. It’s almost never that the delivery is bad. So you can watch former talks and get ideas of how people speak but if they’re writing a new talk, it’s always hit and miss. As an organizer, keep that in mind. Even if you were to line up nine fantastic speakers and everybody delivers really well, all nine of those talks are not going to be great. Someone is going to tank, at least one, every year. If you have more beginners who haven’t written a lot of talks, you’re going to have more of that happen. It’s just something to keep in mind. You’re never going to bat a thousand with this, you just have to do the best you can and get the best talks up there. Overall the conference will average out.
[22:26] Another thing to keep in mind is to maintain some kind of variety, right? You don’t want all the speakers talking about the same thing. You don’t want all of them telling stories; you don’t want all of them doing tactical; you don’t want all of them doing inspirational. It just gets boring. For MicroConf we found that this means a good mix of founders, who are typically telling their story but pulling tactics out of it. That’s the best format for a talk I’ve seen from a founder. Then we have tactical specialists, and these are people like Sarah Hatter with her tactical specialty of support, Dave Collins who really knows SEO and Joanna Weeb who really knows copyrighting really well. That’s been the mix for us. It’s been a good blend of tactical specialists and founders. If you’re running your own conference you’ll have to think about that as well.
[23:11] Mike: Another consideration is the scheduling of the speakers. You really want to have one of your best speakers go first and another go last. By having one of your best speakers first and last, then the conference starts and ends on a high note. That’s really how you want people to walk away from a conference. You want them to feel like, “Hey, this was an awesome conference.” Because they’re going to remember most things about that first speaker and last speaker.
[23:37] Another thing that we found in the scheduling – the very first year we put on MicroConf, we detailed exactly when everything was going to happen. We told people, “This speaker will be speaking from 9 to 10, this one from 10 to 11,” etc. What we found was, 15 minutes into the conference, we were like half an hour off. So at this point we don’t publish that schedule anymore. We publish the order but not a detailed schedule, because if you get off of that schedule it can be very difficult to get back on to it.
[24:06] Rob: Right, we’ve also found that putting some pretty proven speakers at the end of the first day and the start of the second day – so essentially bookending both days with really strong speakers helps, because when people are heading off to dinner for that first day, they want something interesting to talk about. You don’t want them to say, “Boy, that speaker really tanked.” You want there to be positive association and then you want someone strong the start of the second day because a lot of people want to sleep in and don’t want to come. Frankly, you want to encourage everybody to come and you want to kickoff the day with a lot of energy.
[24:37] One other thing I’ll mention about speakers is, if possible, talk to them in advance and ask them to attend your evening events. Ask them to attend the conference. It’s a big deal, and it’s a big compliment we’ve heard about MicroConf, that people can come up and talk to the speakers, that they don’t fly in and fly out to do this one hour stretch. They’re actually approachable, able to answer questions, able to give feedback and they’re around for the duration of the conference. It’s a pretty big deal.
[25:01] Mike: Another thing on the speakers is that – I think one of the best things you can do for the speakers is have a speakers’ dinner where essentially you’re kind of thanking them for the event. But you’re also setting them up so that they know what to expect at the conference, especially if they’ve never been to the conference. We host our speakers’ dinner on Sunday night before the conference even starts. That helps the speakers who are coming, because then you can set expectations for them, you can let them know what they’re likely to see, what the audience is going to be like. You can let them ask questions, and of course you’re going to want to pick up the tab for them coming to the conference.
[25:33] Rob: Right, and this has actually been a big perk for some of the speakers. We’re not able to pay our speakers, and a lot of them are important and very busy. But being able to hang out with both the MicroConf attendees but also the other power players, to reconnect with folks they may not have seen at the speakers’ dinner is a big perk. We’ve had compliments about doing it.
[25:56] Mike: So let’s talk about sponsorships for a little bit. One of the things we do to help pay for MicroConf is have sponsors at the conference. I think you really need to be very sensitive about hosting a conference where you’re having sponsors. I’ve been to some conferences where you go there and sponsors basically buy their way in to talk onstage for an hour or two at length about their product, what they can do for you and it basically becomes this giant sales pitch. We really wanted to make sure that we didn’t do that for MicroConf.
[26:25] So there’s this delicate balance we’ve kind of struck where we have the sponsors there, we definitely highlight them and talk to people about them, but we don’t shove it in their faces. We do giveaways for the different sponsors so they have the opportunity to put things forward. We’ll do giveaways in between speakers and they’re obviously welcome to come to the conference. In fact, we actually encourage that. One of the things that we do for the sponsors is that, as part of the different sponsorships, they are invited to come to the event and their tickets are included in those sponsorship packages. It’s essentially a way to say, “This is the cost of the event, but for this much more you can become a sponsor.” One of the things that we do with the sponsors is make sure that we try to get those sponsors to the event. They’re going to get a lot more out of it as a sponsor if they attend.
[27:09] Basically, we’ve priced the sponsorship levels above and beyond what it costs to come at the event. You can’t be a sponsor without getting those tickets. We simply avoid giving people the option to sponsor if they’re not also going to get the ticket. There are some sponsors who say, “Look, we just want to support the event but we can’t come so we’re going to do a giveaway. We’ll give away our ticket.” That’s fine; that’s totally cool, but at the same time we want those sponsors to come so that they do get a lot out of it, they are able to interact with people. That’s part of the value proposition that you have to provide to them. You have to have a solid value proposition that says what they’re going to get and how does your audience overlap with theirs.
[27:50] I think the last comment I have on that is making sure that you have a rate card for the sponsors so that it’s very clear cut what they’re getting and what the different packages are so that it’s not more of a negotiation. Because some sponsors will try to negotiate with you and I think it’s a bad idea to negotiate on a sponsorship side, especially in terms of price. If you lay it out in a rate card, people look at that as more of a menu and it becomes much less negotiable.
[28:15] Rob: Something’s always going to go wrong. We’ve had something go wrong every conference, including speakers canceling during the conference or the day before. We’ve had some issues with sound, music too loud at some of the venues that we aren’t able to control… all kinds of stuff is going to go wrong. You just kind of have to give into that and understand that when it goes wrong, you just do your best to fix it. We’ve actually had some of our best innovations come from a speaker canceling, because we then did some website tear-downs. That has become like a pivotal part of MicroConf and something that people look forward to.
[28:53] Mike: Yes, I think it was three or four years before I was actually speaking on the day that I was scheduled to. It’s been a running joke.
[28:59] Rob: You were always scheduled for the second day and then we always had something go wrong with a speaker on the first day. We had a flight delayed, someone who got sick and then something else. We moved you to the first day, so the night before MicroConf you were always scrambling with your slides.
[29:13] The other thing to think about is that all of this always requires compromises. We’ve named a bunch of criteria for the city, the hotel, the venue, the audio and the cost. You’re going to have to compromise on something. Pretty much every year we feel like, “Yeah, all right, we nailed the city and hotel but boy, that one venue we just couldn’t afford to get one better.” Or, the venue is really nice but the evening events at the hotel weren’t as good because they didn’t have an outdoor event. You’re never going to find the perfect package; you just have to be willing to figure out where it is you’re willing to compromise and where you’re not.
[29:48] Mike: I think one thing that’s really helped us is knowing in advance exactly how many people we’re going to be having at the event. Part of that isn’t so much the number of people but knowing exactly what our budget is to work with. If you’re always working with a moving target for the different places you’re having events or meetings or workshops, anything like that – that moving target becomes a very big challenge. But if you know exactly how many people you’re going to be having before you even get there, and you’re able to give them that number well in advance, it makes things so much easier and you know in advance if you can pay for something. You don’t have to think twice about it. You just say, “Is this good for the conference? And can we afford it?” Not having to deal with that moving number is extremely valuable.
[30:34] Rob: When you’re done running this event, you’re going to be exhausted. You need to do a couple things. One is take a couple days off and decompress and think about the conference. The other is find someone to talk about it with. Hopefully if you have a co host you’re putting it on with, you can sit down for an hour or two and basically do a debriefing or post-mortem. Figure out what you did right, what you did wrong, what you’re going to change for next year, how things went in general – I find that time to be invaluable. You have so much in your head and it’s so intense when you’re running this event that taking those hours and getting it all out on the table is very helpful for trying to return back to normal life, frankly, and normal work. I find that I pretty much won’t get any work done for two or three days after MicroConf because I’m so burned out. Because it’s kind of like the volume turns up to 11 for a few days and it’s really hard to just come back into a normal life after that.
[31:30] Mike: Yes, so you and I usually record a podcast – essentially right after the conference is over. We just kind of sit down and talk about what went on, what went right, what went wrong and I think that having two of us there helps in a lot of ways. But being able to talk about the different things that we saw and being able to get different perspectives on them. Different people are going to have different perspectives even if they see the exact same thing. If there’s more than one person running the conference with you, then it makes it easier to get those different perspectives from somebody who was deeply involved in the entire process. So I would probably recommend that you actually have somebody who was working with you on it in a major capacity. I think you and I both kind of go on vacation afterwards as well. I think last year I went out and camped out in the desert of Utah after MicroConf.
[32:14] Rob: Yes, I typically just come back home and take a couple days to decompress and maybe check email a few times. But I don’t do much work on purpose after that.
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