Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike talk about how to recover from coding for months without talking to customers. Based on some questions a listener sent in, the guys give advice to the classic problem of spending all your time developing and not enough time talking with customers.
Items mentioned in this episode:
Transcript
Mike: In this episode of Startups For the Rest of Us, Rob and I are going to be talking about how to recover from coding for months without talking to customers. This is Startups For the Rest of Us episode 347.
Welcome to Startups For the Rest of Us, the podcast that helps developers, designers, and entrepreneurs be awesome at building, launching, and growing software products, whether you’ve built your first product or you’re just thinking about it. I’m Mike.
Rob: And I’m Rob.
Mike: We’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s going on this week, Rob?
Rob: Well, I am back from Sweden. I had a great time attending and speaking at Brennan Dunn’s Double Your Freelancing Conference in Europe. He said it was going to be the last DYF conference he throws and then he’s going to only do small retreats after this so it was cool to meet up with him and his crew.
And then I spent a couple of days with Sherry in Stockholm. We had left the kids at home and we had a great time seeing the sights, painting the town red, and I got a good amount of work done. It’s crazy when you’re in a new environment. I was basically taking the days off, “vacation days,” but there was still stuff going on back here, back in the office so a couple of hours a day, 90 minutes or so, I could just hammer out a ton of email and Slack replies.
I had some really good ideas because I had the headspace to think about stuff so I noted them down and I’m starting to put those in the queue right now. It was actually a productive, I wouldn’t even say it goes far as to say as it was a workation, it was more like a light vacation with a bit of work sprinkled in. That’s, to be honest, my ideal thing because I think when I don’t work for like a week, I feel disconnected and I get bored just travelling and being in places without having something to occupy my mind.
Mike: I’d imagine that’s a lot like retirement as well. I’m not one who just likes to take extended vacations just for exactly that reason. I find myself getting bored.
Rob: Yup. I think that’s where having hobbies, like I do investing, which is fun, but I can only do so much of that in a day and think about it for so long before I need to do the next thing. After the conference was done, we would go see one sight and then we’d go to lunch and then Sherry and I would come back in the afternoon which is when this time zone was waking up and Sherry had a few calls and she was still doing quite a bit of consulting and stuff. It was good. It was a nice mix. I really enjoy that stuff.
I also enjoy getting away for retreats. Like we’ve talked about in the past, taking a full two, three days but seven complete days for me without thinking at all about the things I’m most passionate about, which is a lot of what I work on, is always a hard stretch.
Mike: Cool. On my end, I finally got the two step sign up process for Bluetick all squared away. There’s definitely edge cases in there that I just said, “Look, I’ll deal with this later.” Instead of making the whole thing bulletproof, I made it basically just work. I know that there’s going to be cases where something is going to come up and somebody goes to sign up and it’s going to break. I’m just going to have to figure it out at that point because I don’t really have the time to try and capture every single edge case.
Right now, it’s just going to show some generic messages if it goes sideways and certain ways that I just don’t know about because I don’t know all the different ways that Stripe for example, could say, “Hey, this card isn’t going to work.” I got that all squared away and finally got started working on the marketing and sales websites. I got the price and page all set and I’m working on the tour. I got to create a couple of videos to add in there, probably put one on the home page then work on flushing all the rest of the tour and figuring out whether I want to do just one page for the tour or I want to divide it up into several of them based on what different situations people are in.
I’ve got a bunch of different notes that I’ve aggregated from various customer discussions that I’ve had and different things that they’ve either keyed on or asked about during demos and putting those into specific places in the tour and try to essentially walk somebody through the decision making process for it.
Rob: Good for you, man. That’s exciting. I know it took a lot longer than you wanted to but it’s got to feel good to have that behind you and be able to pull the next thing off the list.
Mike: It is. The thing I don’t like about doing the stuff on the tour side of things is that it’s a completely blank slate and I’m not a designer. I’m sitting there, going through and trying to figure out how should the page be laid out and what should I say in certain areas and how should one thing lead into another. For whatever reason, it’s really hard for me to do that. I can conceptualize what I need to say but doing the layout for it, that’s the part I’m having a hard time.
Rob: Yeah, that is hard. I haven’t done that in years. When I used to do it, I wasn’t very good at it. It’s such detailed work. It’s tough. That’s what you got to do when you’re scrapping being bootstrapped and you’re counting the days until you can hire someone else. Get a contractor, even if it’s a contractor, get somebody because they’re so much faster at it and the end product will look better too.
Mike: Plus it’s all in WordPress. There’s only so much that I can do in WordPress. I’m just going to make do with what I’ve got and then after that, just look for a designer at some point down the road, when I actually have the funds for it.
Rob: For me, my other point of update is we’ve had some recent questions on the podcast about books, or resources to learn how to build a SaaS app and someone had pointed out the PHP spark framework, which I think is pretty cool.
There’s another one in the works now. It’s Marcus Wein. He’s in Austria and he’s working on a SaaS guide book for Ruby on Rails. I actually met him at Brennan’s conference. We talked about stuff and then he cooked up this idea and put up a landing page while we were there. I thought that was cool. He’s getting to work on that book and the URL for that is saasrailsbook.com.
If you’re interested in the fundamentals of how to build a SaaS app and are willing to either learn Rails to do it or you already know Rails and you want to just learn how a guy who’s built dozens and dozens of them would architect it and then all the things that he would think about, go ahead to saasrailsbook.com.
What are we chatting about today?
Mike: Today, we’re going to be diving into a problem that a listener had sent in to us. His name is Zac and he has a product called neverlate.io. He started working on it. He spent about three months working on it and has a basic MVP all set up but he fully admits that he made this classic mistake where he spent several months in his basement working on it and has come out of it and now he’s ready to try and find customers but he has no customers to go to or to show it to because he spent all that time working on the product itself rather than doing any customer development.
He’s tried a couple of different things to generate some traffic. He’s tried some AdWords. He’s talked to a few different people but really, he’s at ground zero at this point and he’s wondering, “What do I do here? What do I do to try and move this forward and make it work?”
Rob: The URL again is neverlate.io. It is an appointment reminder service. Right now, it is very horizontal. It doesn’t say appointment reminders for XYZ niche. It’s just a broad appointment calendar plus it can send automated text messages. I guess that’s it. It doesn’t look like it makes phone calls either. Anyways, I’m just looking at the home page. Obviously, I haven’t used the app, just trying to give the listener an idea of the business. It starts at $29 a month for up to 200 appointments a month and it has a $50, an $80, and a $500 tier.
Mike: This reminds me a lot of Patrick McKenzie’s appointment reminder app. Maybe, that’s where the idea came from. But to give a little bit more details on this, I’ve gone back and forth with him just to ask a couple more detailed questions. When he came back, he basically told me the product is functional but he doesn’t have a customer list. He doesn’t have a channel where he can start to do customer development. As you said, the bottom price point is $29 a month.
In terms of his target market, he’s a little bit unclear on where to go with that. He knows certain ones that he’s probably going to skip so he’s inclined to skip massage therapists, for example, because he doesn’t think that they’re going to be willing to pay more than like $10 a month. And then in terms of sign ups, he’s gotten some from AdWords. He spent about $50 or so in AdWords and he is getting people to sign up for trials but it’s not a lot and obviously AdWords can get very expensive.
In terms of lifetime value, he really doesn’t know yet. He’s thinking maybe a year or so of service so around $350 for lifetime value of a customer. His base question is really just what do I do at this point? Should I spend more money on AdWords? Should I do something else? What are my options and what are your recommendations about where to go with this?
Rob: We have an outline here but to kick us off, you’re in a real tough place because you basically have no customers, no list, and you have a me too product. There’s nothing that differentiates this product that I can see from, I won’t say a slew of others but I bet if I search, I can find a half dozen apps that do exactly what this does. Definitely back against the wall at the present.
Mike: I think that’s probably a situation that a handful of listeners have found themselves in over the years, probably more than a small handful, where you’ve built something and you get to a point where like, “Okay, yeah, I’m ready to take this to people and show it to them because I’m no longer embarrassed about what it is or what it looks like.” But you haven’t gotten far enough down the customer development road to figure out who it is you’re going to talk to.
I think in this case, your first priority is to prove, one way or another, whether or not this idea is going to be viable for you to execute on. I’ll put “prove” in air quotes because you’re really never going to be 100% sure that it’s going to work but you can get an idea of it. You can start looking down the road and you start doing that customer development and try and figure out does this look like it has legs or am I just wasting my time and money to try and to get this to work?
Along that lines, I think the first thing to do is really set a time line. For something like this, it seems like a six months time line is probably an appropriate timeline to set for this. Especially if you’re working on the side, if you are working on it full time, probably less since you have a fully functional MVP, take that time line, set it aside, and say, “Okay, I’m going to do X things during this time.” And set goals for that entire time line.
The first goal that I was thinking you would set up for six months, months one and two should really just be focused on trying to get a certain number of customer discussions, whether that’s five per month of five per week. Really, you can set your own pace and schedule at that. But you’re trying to figure out can I reach these people? How do I reach them? Once you start having those discussions with them, you learn more about who they are, what they do, how much time they spend in different areas, especially trying to solve this particular problem, whether it’s something that they’re willing to pay for.
Once you have that information, you ask yourself, how much are they willing to pay? Obviously, you ask them as well. But you want to find out, are they willing to pay for it, how much, and listen to the language that they’re using. Really, these first two months are just spent doing these customer discussions. Yes, if you can get them to a trial or on to a paid account, that’s great, but that’s not your goal here. Your focus should be getting a certain number of customer discussions because that’s going to give you an idea of how easy or difficult it is to continue doing that down the road.
Rob: Right. If you can’t get into these customer discussions, which are really about learning, as you’ve just said, rather than trying to build revenue, if you can’t find anyone who’s willing to talk to you, that’s a very, very bad sign. It’s a sign that you’ve built something that people just don’t care about, don’t need, don’t want, which is going to be something you could very well run into with any product that you launch. At that point, you have to decide am I willing to essentially continue to add things to this that actually make it unique so that I’m the only app that does this in this way, or to pick a niche and niche down.
Like you said, you don’t want to do massage therapist and I don’t blame you. Is there a group? Is it medical or dental because they have HIPPA so they’re really expensive and so they’re the $500 a month and up and you offer only HIPPA compliant so it’s important reminder for medical and dentist office. There’s probably some others in that. This is where you have to do this research. This is not the time to run Facebook ads to a landing page and see who converts and play it that way. This is an app where appointments are brick and mortar type of things. I can’t think of an online audience like designers, or photographers, or developers, or entrepreneurs, there’s certain audiences that are just online a lot.
Appointment reminder, if you can figure out a way to target an online audience, great, but if not, then you have to go through these much more manual steps. I don’t really see an angle here where you’re just going to rent some Facebook ads and convert people to trial and split test your way out of this. For the whole six months, you’re going to be learning that these first two months are going to be critical. They’re going to, like Mike said, tell you whether or not you should continue.
Mike: Along with that, in these first two months, you’re trying to figure out who that target audience is. I think early on, Zac had said he was probably going to skip massage therapists. Maybe there’s some data he already has to indicate that they’re not willing to pay for that. That’s fine. But are there other professions or other verticals that you can target and try to have those discussions with them and see if that’s going to work, see if that’s an initial traction channel that you can start to establish.
If it is, great. You can move on to the next steps in months three, and four, and five, and six that we’re going to lay out. Your focus at this point is trying to figure out who those people are and if you can establish a recurring channel of them to have those discussions with. If you can’t, then maybe it’s time to pivot to a different channel, a different vertical, or can the whole thing.
I probably wouldn’t can it after trying to find one vertical. If you go to massage therapists and they say, “No, we’re just not interested.” Okay, great. Go to dentists and then maybe pivot over to a solo practitioner doctor’s offices, for example, or plastic surgeons, or something along those lines. Each of those could be a one to two month effort but you’re trying to figure out is there a place where you can get customers on a recurring basis, at least in the early days?
If you go through several of those iterations and you still can’t find them, then that’s the point where you need to re evaluate your position and decide whether or not to just cut your losses and move on.
Rob: For months three and four, assuming that months one and two are successful and you figure out a niche or a group that you’re going to target, months three and four, your KPI is the number of paying customers after you’ve had a direct discussion. This is very, very much not scalable but what you’re trying to do is to learn objections. You’re trying to overcome them via discussions. You’re trying to close deals. It’s still learning but you’re trying to start making the rubber meet the road and actually get some revenue.
What you might find is that you get through three and four and you can’t get enough paying customers to make it worth your while and you have to go back and repeat months one and two and find a new group to target.
Mike: The whole point of this particular piece of it, I don’t know if some paying customers is like the sole thing that you should focus on. Getting them into the app and getting them active and using the app, that’s probably a much more important first step. Obviously, you want to keep them as paying customers and get them to convert from any sort of free trial that you put them in into a paying customer. But even if they don’t, you’re still going to learn from that. The focus is really finding a certain number of people that you can put into it.
Again, you can set those numbers yourself. You can base it on how many conversations you’re actually having because obviously, if you only have 5 conversations a week, you’re not going to get 10 customers a week. That’s simply not going to happen. From that, you can back that off and put people into the app and learn those objections. You can overcome them by talking to them. A lot of times, people will have a question that if they’re on your website and they have a question in their mind, it draws doubts for them. They will not sign up because of that.
When you ask them, “Hey, would you like to sign up for an account right now?” They’ll say yes or no. If they say no, you can ask, “Well, why not? What’s stopping you? What is it that’s holding you back here?” Those are the things that you want to write down. Every single question that somebody asks, you want to write that question down. That way, you can go back to that and over time, you’ll get a base of let’s say 20, 30, 50 people you’ve talked to. Start aggregating the number of questions that they ask and which questions they ask. You can identify which of the questions were most prevalent, which ones the most people had and use that in your marketing copy once you get to months five and six, which is where you are trying to land the paying customers or on board people without having those direct discussions.
Rob: That’s month five and six. It’s moving out of the I’m talking to everyone, I’m doing demos for everyone, and I might able to start getting people to overcome their objections and sign up for a trial just purely based on a marketing website.
Take these timelines with a grain of salt here. We heard from Jordan Gal last week and he was giving demos for six months, eight months. It wasn’t just the two months we have here or I guess we have four months. One and two, finding the audience and three to four is overcoming objections, and five and six is moving towards the more automated way. Their journey took longer. They have a more complex product, probably harder to explain, harder to demo. Appointment reminders tend to be fairly, I think it’s pretty easily understood by the prospect so perhaps you’d have an easier time or perhaps you’ll have a tougher time getting to five and six because again, your product isn’t differentiated from others that they could find with a Google search.
That’s the idea here. This third step, this third piece is trying to move towards having more automated things in flow and maybe you don’t remove demos altogether, maybe you figure out you have people self select that if they’re in the lower pricing tiers, then they sign right up and if they’re going to pay you three figures a month, it’s probably worth having a conversation with that person. You have a contact that’s linked. Even if you show your pricing, you still have some type of thing, how many appointments per month and immediately, you get a paying customer and have an idea that it’s worth reaching out to them with a calendar link, trying to set up a conversation.
Mike: With each of these sets of two months, months one and two is really about trying to get a certain number of customer discussions going and then month three and four are putting people into the app through those direct discussions and then five and six is getting those customers onboarded without having those direct sales discussions. That’s really just a logical progression. As Rob pointed out, your timeline may vary quite a lot. It could be closer to a year or it could be closer to two months. It depends on how complicated your app is, how far along it is, how many people you’re able to have those conversations with early on, how quickly you get traction, and it also depends a lot on what your schedule is.
If you’re working on it full time, you’re going to be able to move faster. If you’re working on it on nights and weekends, you’re probably not going to be able to schedule 25 calls during the week. It’s just not going to happen because you have a full time job and you’ve got other responsibilities. During the work week, it’s going to be very difficult for you.
But all of this is really just establishing this logical progression so that you can determine whether or not this idea that you have or the product and the MVP that you put together is going to go anywhere so that you’re not wasting too much time trying to make something work that’s simply not going to for you.
I think that’s another key distinction that we’ve made on this podcast before, which is that even though something could be a great idea and it is reasonably well executed, it may not be the right idea for you. If it’s not something you’re passionate about or you don’t want to do or you’re just not interested in it, you’re not going to do it as well as if it was something that you were extremely interested in and extremely motivated to do. You’re going to push things off and not be as motivated to move people forward in the sales funnel and do the website, coding, and everything else.
It’s going to be harder for you. Maybe it’s just not the right fit. Maybe some other product would be a better fit. Again, these are all things that you need to evaluate as you’re going through this process.
Rob: We call that in the biz, product founder fit. As you said, is the product a good fit for you, for your personality, for what you want to do for the customers you want to work with, for the features you want to build. It’s a bit of an amorphous concept and it’s hard to know upfront but what’s nice is that Zac said, right off the bat, “I don’t think I want to work with massage therapists.” That’s like, alright, good. It’s a good thing to know that. Don’t go after that market because you’re probably going to find out that you’re not, even if you found success, you’re not going to enjoy it. You’re not going to stick with it for the long term.
Mike: I think that’s an interesting side conversation. Even if that would work, do you want to do it? I think in some cases, the answer to that is probably not. There’s certainly groups of people that I would probably not want to work with or probably would not enjoy and everybody has their own either biases or people that they know in certain industries, they’re like, “I just don’t want to deal with any of that stuff.”
Again, it may work out. It’s just like marketing tactics. There may be some things that you’re really comfortable doing and the next person may not be comfortable with that at all.
Rob: Yeah, there was an app I almost acquired. I’m trying to think. It may have been after HitTail, or I still owned it but it had grown to where I thought it was going to grow and I was looking at other avenues before Drip. I looked at acquiring a bunch of different apps. One of them was going to put me marketing to and having a customer base of designers UX and usability folks. I had no reach into that market. Obviously, I have an understanding of what they do but I am not in that target market.
It was Ruben Gamez from Bidsketch who asked me, “You’re doing a market pivot by going from an SEO tool, which is at least marketing technology, into something that goes after a completely different audience, is that something that you want to do for the next three, four, five years?” Frankly, I have no qualms with working with designers and UX people, I think it would have been an interesting adventure but it would’ve been a huge learning experience for me.
I thought, “If I do this, I’m going to have an uphill battle to learn a whole new space and to learn what are all the sites where people hang out? Where are the blogs? I already know this from MarTech. That is one of the reasons that I wound up doing Drip. Because it’s not the same as an SEO keyword tool but it is another marketing SaaS and I already knew so much about the space because of my heavy involvement in evaluation of tools from my own personal use. It was just a different thing.
I think I still would’ve been successful. It probably would’ve taken longer had I done that. I would educate myself about a market, make myself a name in that market, which I really, really don’t have. And so, it’s just something to think about as you go through your ideas.
Mike: I think one of the last questions that Zac came up with was should I spend more money on AdWords or should I just abandon that and go do something else? I think, Rob, you’re probably in agreement with me on this one. But AdWords is probably not the way you want to go, especially if you don’t have a lot of money to throw into this because you’re going to spend money trying to learn. It’s not that spending money to learn is a bad thing but you’re going to probably spend much more money than you would if you had some customer discussions first and you waited until month three or four to start pumping up the sales funnel a little bit.
After you’ve gotten some of the terminology a little bit, you’ve narrowed down the market a little bit, if you’re just throwing money out there to try and figure out where the market is, it’s going to be very expensive to do that.
Rob: Yeah. The tough part is since the audience is brick and mortar, it’s going to be expensive and hard to find them. There are tools where everybody’s online and they’re always signing up for new things. You can do the curiosity play and get them to sign up and you have a low price point and you could test an idea with ads landing pages in more broader scope stuff if you had the money to do it. I don’t see an avenue to do that here. Just by nature of the potential audiences that we can come up with, I think you’re right.
I’m in agreement that AdWords is probably not where you’re going to get a bunch of learning at this point. Maybe you could run AdWords just enough to get that trickle of calls that you want. And again, it’s going to be expensive to get that trickle going. But if you have no other avenues, yeah, maybe AdWords or Facebook ads, or some type of paid acquisition, but if you can pay $10, $20 to find someone to get on the phone with you, who has some inbound interest, that’s interesting but you know you could just as easily do some cold outbound email or cold phone calls and perhaps get the same result with less money but more time.
Mike: That’s really what this is all about. It’s striking that balance between how much money you have available and how much time you have available. If you have more time than money, don’t do paid ads. Have those customer discussions, learn who it is that you need to target. If you have a lot more money than time, spend on AdWords and learn who but it’s going to be dramatically more expensive without having those customer discussions to guide you.
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Episode 346 | Lessons Learned from Requiring Demos for New Customers
Show Notes
In this episode of Startups For The Rest Of Us, Mike interviews Jordan Gal, Cofounder of CartHook, about his lessons learned from doing demos for customers. Jordan gives a background on CartHook as well as the journey from one-on-one demos to the possibilities of scaling the sales process.
Items mentioned in this episode:
Transcript
Mike [00:00]: In this episode of Startups for the Rest of Us, I’m going to be talking to Jordan Gal of CartHook about lessons learnt from requiring demos for new customers. Welcome to Startups for the Rest of Us, the podcast that helps developers, designers and entrepreneurs be awesome at building, launching and growing software products, whether you’ve built your first product or you’re just thinking about it. I’m Mike.
Jordan [00:24]: And I’m Jordan.
Mike [00:25]: And we’re here to share our experiences to help you avoid the same mistakes we’ve made. How you doing this week Jordan?
Jordan [00:29]: I’m doing well. I just want to be able to say the word ‘episode’ like Rob does, like super fast episode. I’m doing well. You caught me at a busy, hectic, fun kind of week and I’m excited to talk about this. This is the topic of conversation internally for us also.
Mike [00:45]: I just want to give the listeners a brief introduction to you. You are the co-founder of CartHook. You’ve also spoken at Micro Conf; you are the co-host of the Bootstrapped Web. What else am I missing? There’s got to be other things
Jordan [00:57]: It’s mostly dad and sleeping. I’ve got three kids under five years old plus all the business stuff.
Mike [01:03]: So more dad and less sleeping is what you’re saying?
Jordan [01:05]: Yeah and I’ve gone into the bad habit of staying up late working because I do demos all day. I have four demos today and that squeezes out the ability to get work done so I end up doing it at night, which isn’t sustainable but it’s working right now.
Mike [01:18]: I did one this morning, so I know how you’re feeling about that. Before we get into this, I think that we should probably start at the beginning with CartHook and why don’t you give the listeners a brief background on exactly what CartHook is and what it does so that as we get into this discussion about whether or not you should evaluate whether or not you’re going to require demos for new customers or not that people have at least a background to work from.
Jordan [01:43]: Sure. I’ll give the very quick history and what led us to where we are now and how that fits into demos. We started the company with a cart abandonment product for e-commerce stores. What that means is we capture the email address of visitors to the checkout page on the e-commerce store that’s using our product and then once we capture that email address of the customer, if they don’t complete the purchase within 60 minutes, we then consider it abandoned and we start sending them a three part email campaign designed to bring them back to the e-commerce store to finish the purchase. A lot of us have received these types of emails in the past. What we do is enable small medium merchants to do it. That’s where the company started off. We worked on that for about a year, maybe a little more, and then we uncovered an idea for another product that we decided to tackle and the product that we’ve been working on is a check-out product and what it does is it replaces the check-out process of Shopify stores. Shopify is an amazing platform but their checkout process is very rigid and you can’t customize it and so forth. What we do is give a customizable, one page checkout and it also enables something called post-purchase up sales which are very hot in the e-commerce industry right now. That’s what we’re doing and the way we led into demos is because a new product, you don’t know what the on-boarding should look like, you need feedback, you want to talk to as many people as possible. That’s how we got into the demo thing to begin with for the new product.
Mike [03:11]: Got it. Just for the listeners’ background, Shopify is essentially an e-commerce platform where people can sell their stuff and I’ll use that phrase very broadly. But there’s a bunch of different platforms out there where people can basically create an online store and Shopify is one of the platforms that people can use. You’ve really focused specifically on this platform.
Jordan [03:31]: Yes, they’re super hot in this space. They just IPOed; they have an amazing developer eco-system. They have become the default choice for merchants selling physical products online. That’s where we play.
Mike [03:46]: Okay. Let’s dive into a little bit around the idea of these demos. Previously with CartHook, you just had one product before and were you requiring a demo for that or no?
Jordan [03:56]: No. We had a demo page so if someone didn’t want to sign up on their own, they could request a demo and we would get that pretty rarely; either people who really wanted to be hands on and ask questions or larger companies that were used to that process. But 95% of our sign-ups just came through self-serve sign-up, on-boarding, that sort of thing.
Mike [04:18]: Okay.
Jordan [04:18]: That was for the original product. The new product, what really happened, we worked on this product for a while with a lot of early users and then we opened up sign-ups and we got flooded. We had like 100 sign-ups in 10 days and we were not ready for it and totally messed it up and most of them left because the product wasn’t ready and we weren’t ready, the on-boarding wasn’t there so we said, “How do we slow down the rate of sign-ups while also getting a better feel for what our customers want, what we’re doing right, what we’re doing wrong?” We said we are going to do two things; we’re going to raise the price and we were going to require demos. It definitely slowed things down. The interesting thing is the other effects it had like it didn’t change demand very much. That’s how we got into-we used one on one demos specifically as a mechanism to slow things down and to learn more.
Mike [05:14]: That seems a little counter intuitive, where you would want to slow things down. You think of startup like, Oh they want to move as quickly as possible but you’re going in the opposite direction and I think it might be beneficial to explore exactly why that is. You’re talking about things, exploring, you’re going sideways and people leaving. What sort of things-I don’t want to point out specific people or anything like that. But really what types of things go sideways when you have too many people coming in?
Jordan [05:39]: It’s just the nature of our product that we had to learn about. It’s a fact we had to face. This product that we took on is [?] and not simple and we have a team. Then it was four people. Now it’s five. We bit off a lot. What that meant is that the product was going to take a while. You’re always like, “Oh, yeah, you’ll have an MVP up in three months,” and it’s not usually three months and this is a complex product. We just had to face the fact that it was going to take longer to get the product to a place where we could take on a lot of sign-ups successfully. We didn’t want to ruin our reputation. We didn’t want just let people in, the product wouldn’t be ready and they would just leave. It’s hard to get a second chance with people. We just thought strategically, okay, we don’t really have a choice. I’d love to go as fast as possible. I’m the one guy in the marketing side and everyone else is on the tech side. It has caused a lot of frustrations in terms of, “Guys, we need to go faster,” but it’s almost like they had to pull me into the tech side and educate me a little bit about what was happening and once I learned more about it, I understood, “Okay, this is not the time to rush; this is the time to be patient,” which was painful but it was necessary.
Mike [06:55]: It’s really about slowing down the number of people that are coming in more or less because you don’t want to burn the relationships of those people and leave a bad taste in their mouths when they sign up and maybe something doesn’t work or it doesn’t do everything that they want because down the road your hope is eventually you would get them as a customer. But if you don’t have the features in place that they really desperately need right now, they’re just never going to convert because then they’ll look at your product in a negative life basically forever. You only have that one chance.
Jordan [07:21]: Right and it goes against everything that I want or would give advice on. It’s just that the nature of the product is that so many things have to be perfect. It’s not like this core feature that we offer works. The other things, not so much but people still get value out of it. To get value out of a checkout product, so many things have to be perfect because if you mess anything up on a checkout page, people don’t convert and we’re going up against Shopify’s checkout page. Their alternative is to do nothing and Shopify is this $5 billion behemoth and their checkout page is amazing. We have to compete with that. It was just going to take a while to get page-load perfect, Facebook tracking perfect, credit card perfect, PayPal perfect. If you mess any of those things up, the person wasn’t going to get the core value. We had to deal with that fact.
Mike [08:10]: All those things you just mentioned, those are technical aspects of the product itself. What about the sale and marketing side of things? If you build in a product yourself, one of the things that come to mind is that if you are a developer, you look at the techs [?] and you say, “Hey, I just want to work on these stuff because I know how to do that,” and it makes it easier for you to do it. There’s this whole other world to you as a developer that all the marketing and sales stuff, you’ve got no idea. A lot of people will put it off and I’ve certainly succumbed to that as well in the past. The reality is that when you get into that position, there is a lot to do on both sides of it and if you’re just one person, it’s hard to juggle both of those. But you’ve already got a team in place. You’ve got four or five people there and you’re apparently having trouble dealing with stuff on the tech side, not because the team isn’t good. It’s just there’s so much stuff to do that needs to be perfect. On the marketing side, that is also the case in many respects. You’ve got all these things that need to be prefect in terms of your learning page, contact marketing, SCO, there’s all these stuff that goes with it that makes that difficult as well. If you have a really tiny team, if it’s only one or two people, juggling both of those at the same time, it just makes it astronomically difficult.
Jordan [09:21]: It’s been difficult.
Mike [09:22]: Okay.
Jordan [09:24]: Yap, you’re 100% right. Again a lot of these, if I look back objectively, a lot of these is going against what I would think is the right thing. It’s just that we’re just making the best decisions given the information that we have. It’s been a team effort for months of I get a demo, I get a customer, I pass it off, I learn a lot, I take that knowledge, I transfer it over to the tech team, they work with the customer, then they give me feedback. It’s been this knowledge transfer back and forth but the raw material for that process is users but not too many, right? If we had 10 sign-ups a day, it would be a mess. We wouldn’t learn nearly as much. We would just be dealing and putting out fires. But if you passing out one new sign-up a day, all of a sudden it’s more manageable and you learn a lot more. We also learn about who the right customers were for us. We’ve had one customer that just has done really well the whole time. That gives us this north star of like, all right, they are getting amazing value out of the product. They’re making a lot more money. They keep spending more on ads. They keep making more money. Their business is growing, they’re hiring and we are like, “We know we can do it.” That’s the thing that kept us going when we were like, “Jesus, this maybe just too hard.” The demo is the initial part of the process. It’s like, “Okay, talk to someone, figure it out and then put them into the tech side,” and then we learn back and forth from one another.
Mike [10:53]: That learning process actually helps you short circuit a lot of the other problems that you might run into where, with sales and marketing, sometimes you put a learning page out there or even just the homepage of your site, you’re not sure which of the benefits that you should highlight because you haven’t talked to enough people. You start guessing then you’re shooting in the dark and this short circuits that whole problem because you’re talking to those people, you’re making notes, you’re getting more direct contact with these people and you’re getting the marketing lingo in their terms that they would use versus the things that you know because you’ve researched the problem extensively and you have your own terminology for it. By gathering that stuff, you are helping to not have to shoot in the dark and not make guesses and then wait two, four even twelve weeks to see if it made any difference in the number of sign-ups and trials coming in.
Jordan [11:44]: Yeah. It got to the point where we didn’t update our marketing site on purpose. Our marketing site talked about version one of the product where it didn’t even work inside the Shopify store. It only worked as a bridge between your learning page and your Shopify store. If that sounds confusing, you’re not alone. It was impossible to describe accurately. We had our marketing site talk about that version, the first version of the product that only worked with the learning page. We didn’t even change the marketing site till about two months after we had started working directly inside the Shopify store because we knew just stating that was going to drive demand so much higher that we just avoided it. We just said, “No, we’re getting a few demos a day. We don’t need more. Let’s just leave it alone.” I would never recommend that to someone. It sounds ridiculous. Here’s another sin to admit to. We don’t really do any marketing or advertising. It’s literally a build-it-and-they-will-come scenario only in this situation I’m 100% convinced it’s right because the demand for the product is so high. We’re not even doing content. We just don’t talk. We say nothing. Just word of mouth out there and a few Facebook posts and that sort of thing is enough to drive a few demos a day and we just left it like that, up until a week ago.
Mike [13:05]: If you’re getting enough to keep you busy and move things along at the right pace, it’s perfectly okay to do that. When you make a mistake of saying, “If I make the product perfect, everything will work out,” but you don’t also have the accompanying number of sign-ups, I think that’s when people get into trouble.
Jordan [13:24]: Right. If you’re not talking to anyone and you’re guessing that you have the perfect product, that’s dangerous. If you’re talking to 15, 20 people every single week and they’re telling you, “Wow, this is exactly what I’ve been looking for,” then it gives you the confidence to say, “All right, let’s just get this right and then when we make the big reveal, it will work.”
Mike [13:42]: Right. I just want to make that clear to the listener that building the perfect product is not the solution if you don’t also have the accompanying number of people that are coming through your sales funnel. If you have that mentality and your sales funnel is empty and you’re not talking to anybody, then that’s the problem. It’s not about the product being perfect. It won’t matter. You need to talk to people. You need to have that marketing stuff in place. Going back to the marketing side of things a little bit, you said that you really don’t talk about a lot of things on the website, at least some of the advance features and the other stuff around the new product, how do you go about qualifying people in advance of the demo? I think there’s a certain amount of information that you need to gather from people and you don’t want to just give a demo to anybody. That’s a mistake because you’re going to end up with those people who give you an email address and you’ve got nothing to go on and you have no idea whether you’re just completely wasting your time or not. What sorts of things do you guys do?
Jordan [14:35]: At first I was happy to talk to anyone. If you read something about the product and you want to talk about it, let’s talk. As things progressed, you start to see that as, “Okay, this is a complete waste of time so let’s start adding a little bit.” On our site, if you go to carthook.com/checkout, you go to the pricing section and it has a few tiers and each tier has the same call to action. It’s just ‘schedule a demo’. When you click on that, you go over to carthook.com/demo. That’s just a really simple form that asks you for a few pieces of information; name, email, phone number is optional, your website address and then we’re just real straightforward. Our pricing is based on revenue and so this form is based on revenue. It just says, “What is your monthly revenue.” We just ask people how much you make. How seriously should I take this meeting? It’s real straightforward because we have two products; we ask which product are you interested in, the funnel product or the cart abandonment product? Almost everyone says funnel of both. That’s what starts off our process. We haven’t wired up into Slack. When we see something come in and it’s the highest here is over 100K a month, that’s just exciting. When it’s under 10K, we just look at it and say, “Okay, opportunity to talk to someone but not as exciting.” The one lesson I have learnt is that, that is far from perfect. Some of our biggest customers came in and identified themselves as less than 10K because the site was new, technically less that 10K but these people are very experienced with big budgets. It’s a little dangerous but we don’t do a survey or form. What we really wanted to do with this was slow things down but not put up too much friction. It’s just a form, you fill that form out, I get an email. After you fill the form out, the page changes and you can see a calendar link to grab a time on my calendar. If you don’t grab it there, then I’ll go to the email that comes in and I have a save-reply and I say, “Hey, nice to meet you. Here’s my calendar link, grab a time.” That’s how we start the process.
Mike [16:37]: It’s interesting that you use the monthly revenue as the qualifier for that. You’re probably much further along than I am just because you’ve got the two different products that you’re working with but I actually look for a lot more information than you do. I’ve got like a full blown form where when somebody comes to the Blue Tick website, they can enter in their email address for early access and it’s all I had asked them for initially. Once they do that, it takes them to a survey page that says, “Hey, great. Now we’d like some more information from you,” and ask where they heard about it, what do they find most appealing, how do they think it would help them, their top questions. I ask them to describe what their current follow-up process is because one of the things that I want to make sure is do they have one in place right now because if they don’t, I’m going to be doing way too much hand-holding and I’m going to be educating them. If you go to the mass market with a product, then, sure, educating people on how to do that is fine but what I’m really looking for is those people who are well qualified, who are going to essentially be more self-sufficient. Do you find that there are certain types of questions that you’re asked during a demo that help you narrow down whether or not somebody is well qualified for your product that would be very difficult to ask on a form?
Jordan [17:49]: I think it depends on your goal. If you only want to talk to people who are well qualified, I would use a form. In our case, we don’t want to only talk to a very specific segment. We just wanted to slow it down. We just wanted to put a barrier in place as opposed to you put up a higher barrier. You’re saying, “No, I really only want to talk to you if you’re right for me,” which sounds like the right approach when the product is earlier on. For us, it’s a little later on the product but we just wanted to slow it down. You can play with how much you ask how much time commitment you’re asking. Not only are you getting the information from that form but the person who filled out your form spent 10 to 15 minutes on that form. They’re motivated. When you have a conversation with them, it’s in that context, “All right, this is a real opportunity.” For us we didn’t want that. We wanted higher numbers but slow. What I do is I save those questions for the actual demo. After someone schedules something on [?] does its thing. It sends out a reminder on the day before and an hour before. In addition to that what I found works is if I go in and manually send them an email 15 minutes before. I just look at my calendar for the day, I set my iPhone and I set alarms for 15 minutes before each appointment a, so that I don’t forget and b it tells me, “Hey, send that email.” I go to Gmail, just super manual because you can tell that it’s manual. I have a ‘save-reply’ so it takes me 10 seconds to do. It says, “Hey, look forward to speaking with you in about 15 minutes. Here is the link to join the call.” After you do that, you can also join the audio,” because good lord did I have trouble the first week or two of like, “No, no, no click on the freaking phone button or call in the number.” Yeah, you have to be good at anticipating that. One of the tricky things is the way you see it-for me I use ‘join me’ which I like a lot-the way you see the ‘join me’ experience is different from the way your customers. You need to test that out yourself to make sure you know what it looks like on their end so you can actually be like, “You know that field where it says ‘your name’? Type in your name and hit knock the button that says ‘knock’ and I will let you in.” I have that in the email.
Mike [19:56]: This is really about identifying what those friction points all along through that is. That’s an entire sales funnel anyway. Getting people to your website getting them through the process of paying you, signing up, on-boarded, demos and all that stuff, there’s all these little touch points or friction points that, as you said, with your checkout products, if everything is not perfect or at least the five or six things are not perfect, then they’re going to leave, churn out or not going to end up paying you. This is the exact same thing though. There’s all these little things like ‘click on the knock button’. That’s not something that’s obvious but after you do it several times, going through this process with the demo, you see those things and you say, “How can I knock out that barrier? How can I eliminate that so that people don’t run into it or when they do, they know what to do? ”
Jordan [20:43]: I had some funny experiences. We love Zoom. We use Zoom internally for our daily standup calls. Our team is fully distributed in New York, Slovenia, here in Portland. We use Zoom and I love it. People are like, “I use Zoom for Demos.” I said, “Cool, I’m dropping ‘join me’ and use Zoom because I love it.” I had the most awkward week of my life because I couldn’t get-Zoom had this bug where you couldn’t disable video from coming on automatically. I have a demo and I send someone to Zoom link and all of a sudden, their camera were turned on and they weren’t expecting it. These days, not everyone works in office. You’re in your house with your cat on your lap and the video comes on and the initial touch point of the demo with me was you be like, “Oh__ my camera.” Oh, excuse me. That was a paid for experience. I had to go back to ‘join me’. I found that, that email 15 minutes before makes the show-up rate go through the roof. When we start the demo, I started off with one question that’s probably my biggest lesson learnt of the entire demo process was to open up the right question at first. That question I’ll give it verbatim, “Before we jump into the product and features and all that, why don’t you tell me about what you’re trying to accomplish and why you decided to spend half an hour of your time with me today.”
Mike [22:03]: That’s awesome.
Jordan [22:04]: Give that because I found that I would start going into the products. We have two main features. You can build two types of funnel and they’re for two different types of customer. I would just start showing them and I would just not know what they were actually trying to do. When I ask that question, first it just gets the conversation rolling more in a consultative way or like you’re talking about your business with another business owner. I’m not like a sales person that’s giving you a demo of a product I’m trying to sell you. It laid that context down to begin with. And then it told me how to tell the presentation, which main feature should I talk about first? How patient or impatient is this person on the phone? How fast are they talking? It gives you an idea of how to handle the conversation to begin with.
Mike [22:53]: I love the way that you phrase that question. It’s much better than the direction that I go so I will totally steal that.
Jordan [22:58]: It’s almost self- deprecating.
Mike [22:59]: It is, yes.
Jordan [23:00]: Like, “All the product features,” whatever, whatever. What about you? What are you trying to accomplish?
Mike [23:05]: Right. That also gives you an idea of what sorts of things you can go through in the demo and completely leave out because they were irrelevant. You can cut out 10, 15, 20 minutes out of a demo if you don’t have to go over a bunch of things that are just unrelated to what they’re doing. The other question I like to ask when I’m doing a demo is what other things have you tried? What that does is it gives you an idea of the pain points that they’ve had using other products and why those things didn’t work out and you can talk specifically to, “Well, you won’t have that problem because we do this,” or, “This is how we address that. Oh, you said you had that product? This is what we ‘do and this is how you would get around it or avoid that type of situation.
Jordan [23:43]: Yeah, I think that’s great. That sometimes comes up as a result of that initial question but it would be good to address. I think we don’t –I don’t do this much because I know there aren’t alternatives. There’s one alternative. I almost just focus on how will you drive in traffic? Where are you pushing traffic to? What kind of advertising you’re using and that sort of thing. People just tell me. They tell you exactly why like what’s the main feature that caused them to contact you. I’m interested in on click up sales. They just say that and you’re like, “Okay, this person is interested in this feature or someone else will say, “I just want my checkout page to look like the rest of my site and it’s like, “Okay, design focus person.” This just helps you do things right and focus on the right things.
Mike [24:29]: Something that you mentioned earlier was about the fact that if somebody does not sign up for a meeting with you right away after they have gone through and submitted the request for demo, you reach out to them. It’s interesting that you mention that because I automated that piece of it so in my sales funnel when they go through, they enter in the survey, I have it sent out to Google Spreadsheet, where I look it and basically decide whether it’s qualified or unqualified. There’s a drop-down column that I can use, just tag it as qualified or unqualified. If it’s qualified, then what it will do is it will populate it into Blue Tick. It will make some tag adjustments inside Drip and do some other things and it will invite them to a demo using a custom calendar link and it injects using [?] string variables. That gets sent through Blue Tick and if they do not sign up for a calendar link within a certain timeframe, it automatically sends them another one and it will send several follow-ups. It’s interesting to see that most of the people that end up coming to the demo don’t respond necessarily to that first email that gets sent that says, “Hey, you didn’t fill out the survey,” or, “You didn’t sign up for this yet, are you still interested?” It usually takes the second or the third. It’s interesting to notice that those reminders help. You were talking about sending an email 15 minutes in advance of the meeting. Those are the types of things that really help move people forward. You don’t think of them as a business owner initially but those reminders or those touch points help. What other places have you found that that’s true as well?
Jordan [25:56]: What’s been really helpful and I keep manual still and look, a lot of these is you look at the ideal and then you say, “Should we go for that ideal and spend the time to achieve that ideal in terms of process?” For us we are so jammed on the product side that I just tell the guys, “Don’t worry about making this process perfect. We’re not going to do demos this way forever. Just keep it ghetto and yeah, we’re losing some people but it’s better off.” Even you can acknowledge what it should be and what it isn’t, there’s a difference. That difference is acceptable depending on the situation. One of the things that I do manually that’s a touch point in the process that way is the most important touch point. We require demo, we also hide the registration link. You can’t sign up for our product unless you-some people find it somehow.
Mike [26:44]: There’s always people who do that.
Jordan [26:46]: Always, amazing. Those people churn out and like, “I told you, man.” You come in, you start asking questions and like, “We would have talked about this on the demo.” What I do, at the end of the conversation, is we have a talk about pricing. We make sure we’re on the same page so there aren’t any weird surprised because our product isn’t cheap and then I say, “Okay, what I’m going to do when we hang up is I’m going to send you an email with the registration link.” Depending on the way the meeting goes, if the person is super excited, I’m like, “Awesome, sign up, I’ll get you the email right now. I’ll look for it, pin me on intercom once you’re inside the app. Let’s do this.” If it’s less certain, regardless of how uncertain it is. I just say, I’m going to send you the email with the registration link so you have it in your inbox for whenever you’re ready and then when we hang up I go and I have another saved reply that says, “So great to meet you today, really excited to get you started. Here’s the link to register, let me know if there’s any help that we can give you in getting set up.” Again, it’s another manual email touch point after the conversation that’s tailored if we had a really good conversation, if they are a big potential customer, I will change that email up a little bit to address the specific conversation that we had. It’s another touch point after the demo instead of just hoping that they sign up. It’s, “Here’s the link, something personal, super manual,” and I make sure not to reply to the chain of emails we had before that; totally new, subject line is ‘CartHook Sign up link’. That way if they are ever searching for it in their inbox three weeks from now, it’s easier to find.
Mike [28:17]: One of the things that I think is a real advantage of doing that is it allows you to essentially ask for the sale right there on the call and get a solid yes or no and then be able to have a conversation about that. Before we go into that a little bit, I do want to ask you a question because you aid you had a discussion about pricing with them but don’t you list the pricing on your website?
Jordan [28:38]: We do but to assume that everyone looks at it, things about it, internalizes it and brings it into the conversation, I found is a bad assumption. I used to think that but then they kept being like, “All right, so how much is it?” And then I would say, “Okay, so clearly you didn’t look that hard,” and I would get pushback. Yeah, it needs to be part of the conversation. I know, technically, you’re supposed to do it as early as possible. I think in our current stage, if I hired a salesperson to take over for me, I would probably tell them to ask that question earlier on. The way I’ve done it is to focus on the product and get a lot of feedback on it and assume that they looked at the pricing and at the end confirm. I know I’m doing it ideally but I try to make sure it’s injected to the conversation and a lot of that comes from that initial form that they fill out showing how much they make. If I see over 100K a month, I know I’m going to have explain our pricing because our pricing is 300 bucks a months for up to 50K, 500 bucks a month for up to 100K and then over 100K is custom pricing. I know already in the back of my head that’ I’m ready for that conversation.
Mike [29:48]: It’s interesting that- you and I have taken different approaches on this, where you list your pricing there but if you go to Blue Tick’s website, it won’t tell you what the pricing is. You have to ask. That’s one of the questions that when people fill out my survey, that’s one of the, I’ll say, the tops five questions that people are asking; how much does it cost? We get into that conversation and it’s not really a big deal or anything but you do have to have that conversation. I think you’re right about the fact that some people just don’t look at the pricing. They see the product and they sign up for it or they end up in your sales funnel because of something else and you don’t realize that they may never have even hit your website or they just landed on that demo page and that was it. That’s’ their only interaction with it.
Jordan [30:29]: Yeah, it depends on the situation. We wanted to make sure we did give the pricing. That was part of our qualifier. If we didn’t have the pricing, I don’t know what would happen. If we could get more form people or a lot of people who self-select out of the process just don’t request a demo because they think it’s too expensive.
Mike [30:49]: It depends a lot on your own pricing. Your pricing is significantly higher than mine is but mine is also per user. It could obviously swing the other way. If you had 50 or 100 people that you wanted to put on there. There is a generalization that people will make about a product based on the pricing itself and whether they feel like they fit into that or they can afford it. I look at $300 to $500 a month and I’m like, “I’m not paying for that for a shopping cart.”
Jordan [31:16]: That has been a healthy challenge. When someone asks you that on the phone, it forces you into this position of, “I need to justify this properly.” If you’re full of it, it’s going to sound like you’re full of it. You have to believe that your pricing is right. We have only one competitor that does the same thing we do and they are $37 a month. We get the awkward question of, “So I just- I’m not saying anything bad about your software but just help me understand why you’re 10 to 20 times more expensive.”
Mike [31:49]: I’d go with the analogy of have you ever bought something at Walmart and then bough something similar-like a blender at Walmart and then bought a blender at any other distributor ever?
Jordan [31:49]: Right. You need a really good response to that and being forced to do that while on the phone while someone is looking at your screen, it forced a good answer to come out.
Mike [32:10]: How does the on-boarding come into play because there’s obviously an on-boarding discussion that you have to have to have with people. If people are willing to sign up or want to sign up right at that point, obviously you’re sending them the links and stuff. What about on-boarding? Do you talk about on-boarding sessions with them? How do you pitch that to them? Is that an up-sell or is that included as part of the cost?
Jordan [32:31]: At the end of the conversation, along with the sense I say about when we hang up the phone, I’m going to send you the registration link, the next sense that comes out is, “If you look at my screen right now, that little thing on the bottom right hand corner, that’s intercom chat. That’s where you can talk to us. That goes to me and the tech team. If you ever need anything, we’re right there for you. That’s how you’ll get the quickest response.” That puts people at ease a little and then the difficult lesson I had to learn was I need to hand off. I’m doing three or four demos a day and what would happen is those users, I would follow them into the on-boarding. Once they got into the app, they had the relationship with me. They say, “Hey, Jordan I need help on X.” I needed to stop doing that because I want getting any work done besides doing demos and talking to people on intercom. I had to be like, “Sign up and Ben out CTO will be here for you. Our tech team will be able to help you. I’m always here for you if you need anything.” There was a hand off of the baton of once you go into this product, I’m not your man. That had a very interesting effect actually. What it did is it created this social status thing where they were like, “Oh, that’s the founder I like can’t talk to him. He’s like out of reach. We did the demo but he’s too important for me to ask these support questions,” which is not true but you kind of want it to be true in their minds.
Mike [33:54]: You want to be able to redirect the work efforts or the task that they’re giving you because somebody’s got to deal with them.
Jordan [34:01]: Right. You have to make sure not to put down the tech site. I would always say our CTO, Ben. I’m positioning him like, “This is someone serious that you can talk to as a business owner also. Don’t treat this person as some random technical support that works for sales for us and some call center. No, no, no, you’re lucky to work with our team and we’re going to take good care of you,” which goes along with the higher pricing promise.
Mike [34:31]: Inside of Blue Tick there’s a link where people can click on it, literally says ‘support’ on it and then it takes them over to the helpdesk. It’s hosted helpdesk and there’s a place where they can submit something and all the tickets come directly to me but it almost doesn’t matter. I’d rather than go there-
Jordan [34:46]: It’s a process.
Mike [34:47]: Yeah, it’s all about process. I cover that as part of the demo because as you said, people want to feel comfortable that they’re being taken care of. I tell them, “Look, don’t hit me up on Skype, don’t send me directly an email. Send it to support@bluetick.io. You’ll get taken care of.
Jordan [35:02]: I like that. I’m going to take that because people hit me up on Facebook, Slack, Skype, Email, all over the place. I like that.
Mike [35:11]: I think there is a couple of different ways you can position that. One is that, for example Skype, I am almost never on Skype. The only time I’m on Skype is if I’m there to make a call and record podcasts. There might, very well, be a week between calls if somebody tries to hit me up on Skype. If it’s a support request, this could be a few days or it could easily be a few days. I’ve had several situations where that happens and I’m like, “You’ve got to email me like add support here,” and then I’ll get you taken care of.
Jordan [35:38]: That’s a good lesson for that.
Mike [35:39]: It is.
Jordan [35:40]: It’s tricky. Facebook is a full-blown sales channel. My Facebook Messenger is a full-blown sales channel.
Mike [35:47]: The other thing that It allows you to do is to use that as essentially a repository for information for when you bring on new people to help out with support and then they get to see what kinds of things have been asked before, whether or not it make sense to make a helpdesk article out of stuff. There’s a lot of advantages to that but making sure that they know where to go to get help is also an important part of that demo process.
Jordan [36:10]: Yeah, I like that. I’m going to regret that a lot because we have so much in intercom and intercom search is horrific. It’s just terrible. When we hire someone for customer support that we’re talking about doing in the next few weeks, they’ll have everything there but it will be impossible to find. It will be a lot more painful.
Mike [36:29]: That almost sounds like a product on its own, like intercom search but I think you’ll get run out of business at some point.
Jordan [36:36]: Yeah, eventually we’ll get it right.
Mike [36:39]: We’ve talked a lot about some of the different advantages of going with a sales model where you’re forcing people through a demo first. Is there a point where you have in mind right now, where in the future you’re going to switch over or do you know that at some point in the future you’re going to go in the direction of, “Look, let’s kind of stop these one to one demos,” or is there a hybrid approach that you’re thinking of where people who are well qualified, above a certain point, you’ll do demos for them but below that, you want it to be more self-serve? How do you envision that working out for you in the future? What sorts of data points have you pulled in to make those decisions?
Jordan [37:14]: That is the single, hottest topic of conversation internally in our Slack. What do we do to transition out of one on one demos? What we have found is that there is no one way to do it. You can be as creative as you want. We’ve come up with a hundred different ways to do it. There is going from requiring a demo to completely self-serve. That’s like going all the way. Between where we are right now and doing that, there’s this huge range of creative solutions. I’ll tell you some of the things that we’re considering. We thought about A, just experimenting with opening up completely, not requiring a demo. We always require a credit card but not requiring a demo and just letting people in and then doing that and at the same time me taking the time that I’m spending on demos right now and spend it on creating on-boarding videos, documentation, helpdesk stuff, knowledge stuff. That’s one way to do it. We talked about allowing for sign-up but then as soon as you log in, you get a welcome screen with effectively a 10 to 15 minute demo of the product. We’ve talked about doing that and requiring the person watches it before they can go forward. We’ve talked about letting people sign up. Having more on-boarding videos but not letting them launch. Taking the bottleneck and moving it from the signup process to the launch process. Our product requires one line of code added to their Shopify Store. In the process, they give us access to their Shopify Store, we go in and we add one line of code. We looking at them and say, “Maybe that’s actually an opportunity to slow things down, if and when we want.” Maybe we just let people sign up, let them on-board, let them set up but don’t let the launch and have them do launch appointments instead of demo appointments. Someone on our team can do a quick 15 minute call, “Hey, is the checklist, looks like you’re good. Do you have any questions before you go? Let me take a look at your account. You’re good to go, cool.” We’re still only launching [?] three a day instead of just 10 people a day signing up and just asking a million questions and not knowing what to do and launching before they’re ready and so forth. We’ve also considered keeping the demo requirement but doing a one-to-many approach. We’ve talked about daily webinars, which would still be more efficient than doing four individual appointments a day. We’ve talked about a weekly webinar on Wednesdays. This isn’t like a webinar to sell a product. It’s really like a demo webinar, it’s, “Here is the product,” for 20 minutes and then another half hour of Q and A. We’ve also talked about doing that but doing it recorded. We’ve talked about putting it in between so when you sign up, you just put your email address in there you can watch a recording and then you can have a learning page using called [?] pages. You could have the video and then only have the button pop-up to register after X number of minutes. I could do a 10 minute video and the button doesn’t show up to actually register until X number of minutes. It’s like-
Mike [40:17]: That seems really sneaky.
Jordan [40:20]: It’s like okay, take the email upfront but there is no right way. We can do whatever we want and what we always say, internally, is, it’s all reversible. What’s the worse that happens? We just go back to demos. What’s the worst? It’s time to open up and see what happens. If it’s an absolute mess, we go back to doing one on one demos.
Mike [40:39]: It’s interesting the way that you put that in terms of moving where you’re putting that bottleneck or that artificial throttle line to make sure that people are doing the right things. Initially or at least right now, you’ve got that bottleneck right in front of where they can sign up. They can’t sign up unless they go through the demo. You’ve talked a lot about moving that further in so they can sign up but they can’t really use it. There’s other ways that you can think about that as well, in terms of if you allow people to sign up without a credit card, for example, but as soon as they go to do something where it’s going to create value for them, that’s when you require a credit card. That’s another place that you could presumably put a bottleneck.
Jordan [41:18]:-which is exactly what we do with our other product.
Mike [41:22]: But I think all that boils down to what is it that you’re trying to do and why. It has to be whatever makes sense for your product and customers and making sure that you’re not putting negative stress on the business in certain ways, whether it’s on the servers that are running or on your support staff or you as a founder trying to answer those support calls or on the sales demo process. There’s lots of things that go into that. It’s interesting the way that you put that in terms of all the different decisions that you have ahead of you to figure out like where is the next best place to try this?
Jordan [41:57]: Yeah, we’ve probably run ourselves a little crazy for about a week on it. Now it’s just-now every time I get a new demo request, I just say, “Time I should be working on something else.”
Mike [42:09]: We can probably do an entire episode on the pros and cons of having the bottlenecks in different places but I think we’re a little short on time at this point. Any parting words for the listeners?
Jordan [42:20]: The only thing I’d say as a parting is to ignore what other people tell you to do. There’s this unbelievably impactful tweet I saw recently and all it was ‘stop telling me what to do’. If you read all these headlines and blog posts it’s like, “Do this for this action, then you get this result and like-,” all these advice but in reality, you don’t have to take any of it. You just do whatever is right for your situation. There’s no such things as, “I’m doing it wrong just because I’m not doing it the way [?] does it.” It sounds a little stupid for us to slow down, people signing up for 300 bucks a month but that’s what makes sense for us. My parting words would be just do whatever is right for you, not what you think you’re supposed to be doing given your industry or space or whatever.
Mike [43:08]: Excellent advice there. If people want to follow up with you after the podcast, where can they find you?
Jordan [43:13]: I’m on Twitter @Jordangal and Jordan@carthook.com, if you want to email me and hopefully see you at Micro Conf in a few weeks, depending on when this episode gets published. I’m looking forward to Micro Conf.
Mike [43:25]: And you’re also based out of Portland, Oregon, right?
Jordan [43:28]: I am, Portland, Oregon. There’s a good, strong, contingent here of web businesses here, a lot of people that go to Micro Conf. Yes, it’s a strong community, really cool people. Everyone’s supper open to get in-touch with everyone. If you are in the Portland area, definitely get in touch.
Mike [43:43]: Excellent. Well, Jordan, thanks a lot for coming on and if you have a question for us you can call it into our voicemail number at 1-8-8-8-8-0-1-9-6-9-0 or you can e-mail it to us at questions@startupsfortherestofus.com. Our theme music is an excerpt from ‘We’re Out of Control’ by MoOt, used under creative comments. 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 345 | How to Get Your Emails Delivered to the Gmail Primary Tab
Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike review their progress on their 2017 goals thus far, and discuss an article about how to get your emails delivered in the Gmail primary tab.
Items mentioned in this episode:
Transcript
Rob: In this episode of Startups For the Rest of Us, Mike and I review our 2017 goals to see our progress so far through about the first half of the year. We also talk about how to get your emails delivered to the Gmail primary tab. This is Startups For The Rest of Us episode 345.
Welcome to Startups For The Rest of Us, the podcast that helps developers, designers, and entrepreneurs be awesome at building, launching, and growing software products, whether you’ve built your first product or you’re just thinking about it. I’m Rob.
Mike: I’m Mike.
Rob: We’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s the word this week Sir?
Mike: Well, I’m really close to finishing my two-step signup process. Unfortunately I’ve spent most of the last three to four days doing nothing but refactoring unit tests.
Rob: That is a bummer. Yeah, it’s good to have in the long run, a bummer to do right now.
Mike: Yeah. Although they have saved me in several places where I definitely would have not uncovered the problems that came up because of it. It’s just painful refactoring certain pieces of it, generating new data, and having that all thrown in there, but it’s working
Rob: Yeah. That’s what they’re for man, is to alert you to something, edge case that you missed. That’s how I always think about it. If they fail and you have to refactor, you’re thinking to yourself, “All right, why is this failing? Why am I rewriting this?” Having to rewrite a bunch of your test, that’s due to the big change you made to your data model, is that right?
Mike: That’s part of it. Some of the refactoring was just to make it easier to write the unit test in the long term so that I can add a bunch more data in there and use somewhat generated data. But of course when you’re generating data, you have to massage the stuff that’s being generated in such a way that it actually matches what would be in the system to begin with.
For example, I’m using something called autofixture which just generates data for you based on the types. For a string, it’ll just throw a goo it in there. Unfortunately that doesn’t work for an email address. There’s always places where the data itself, the data generation needs to be fixed so that it generates something that’s a little bit more accurate. And then there’s places where it’s only expecting two characters for the country code and it generates 30 or something like that. That stuff needs to be fixed so that when it goes to throw into the database, it will actually not fail and then afterwards then my unit test will succeed. Stuff like that.
Rob: There it is. It sounds like so much fun.
Mike: Oh yes, very much so.
Rob: That was sarcasm in case you didn’t detect it. For me, I’m actually hopping on a plane in about eight or nine hours and flying to Stockholm, Sweden for Brennan Dunn’s Double Your Freelance Europe Conference. Both Sherry and I are speaking. Since we’re doing that, we’ve taken this opportunity to leave the children at home. We’re going to hang out at the conference for a couple days. I think it’s three or four days actually. And then we’ll wind up staying in Stockholm just for an extra couple days to see the city. We’ve been there once before but it was only for about a day or a day and a half and really interested in digging in. There’s so much cool stuff there.
Mike: Are you coming back?
Rob: I am coming back. Without the kids, you could imagine Sherry and I will be asking ourselves that question every day.
Mike: “Do we really want to come home?”
Rob: Come home? Yeah, definitely.
Mike: We can push this off.
Rob: We’ll call home and be like, “We got snowed in.” “It’s the middle of the summer.” Yeah, looking forward to that and also to getting back. It’s fun to go away but I’m actually in the middle of working on a lot of interesting things. We’re pushing a lot of features right now to production, we’re just really hitting our stride, have a good shipping velocity. When you enjoy what you do, it’s also hard to step away from it for a few days but I think it will be good. I think I’ll come back refreshed. I’m looking forward to get back in the saddle.
The first thing I want to talk through today is something we mentioned last week. It’s that you and I in December of each year, we set out a few goals for ourselves, typically three or four each. In the past, we tend to just revisit them the following December and we say we succeeded or failed or whatever.
It was interesting, we’re about three months into this year and you’ve suggested that we just revisit them. It makes sense to do it again now because we’re almost halfway through the year in another week or so, week or two, we’ll be halfway through the year. I thought we could quickly step through as a precursor to the main topic and just run through these goals again and report on our massive successes or immense failures that we’re currently experiencing.
Mike: Great.
Rob: Yeah I know, fun. Why don’t you kick us off.
Mike: My first one was to log at least 100 days of exercise this year. The past two months or so have been pretty rough just because my shoulders screwed up. I’ve only logged 20 so far this year.
Rob: Oh, wow.
Mike: Yes. I should be up closer to 50. I’m pretty far behind at this point. I knew I’d be behind just because of what was going on. The doctor put me on some medications. It was 1,000 mg of Naproxen for two weeks, which is above what the normal dosage would actually be. I think if you go over the counter, I think they only recommend 600 mg or something like that per day, but she has me on two 500 mg tablets twice a day.
That actually helped quite a bit. It was mostly I think inflammation in my shoulder right now. Now I’m getting to the point where I can move it around a little bit. I’m doing some physical therapy to help just give me some flexibility and range of motion back. It doesn’t hurt as much as it did before but I still have to be a little careful of it, because I just don’t want to have a major regression or anything like that.
Rob: Oh, totally. Yeah, that’s a bummer. Have you thought about bike riding or swimming or something? Something that won’t put impact on it?
Mike: I didn’t even have the range of motion. I literally couldn’t lift my arm up above shoulder level before, so swimming would be difficult. Although we just opened our pool this past week so I might be doing it anyway.
Rob: Yeah, yeah. That’s a bummer, man. I felt the same way a few weeks ago when I got strep throat. I was basically out of commision physically for about a week and a half or two weeks. During that time I also didn’t exercise.
I have a similar goal to you and it’s two days of exercise per week. For the first three months of the year when it was still cold here, I was almost getting it, man. I think we reported about that in March. I was definitely getting one day a week, some weeks I would get two days, and others it just wasn’t happening. It’s hard when it’s five below or five above zero to do that even indoor stuff, just wasn’t shaking out.
Since the sun came out and it started to get warm in March, I’ve been very consistent. In fact, I’ve been probably up at three days a week. Because with the sun like this, I mentioned last week that there’s bike trails from my house. It’s about a 25 to 30 minute ride to work. Every office day, which is three days a week, I’m riding to and from work. It’s almost 50 minutes of riding. I need to look to see how much that is, five miles or something to get there, four to five miles. It’s decent, it’s not a huge ride but someone like me who really just needs to not be completely sedentary, I’m definitely ahead of where I normally am and feeling pretty good about this goal.
At least through September, October, and then we’ll have to see what I can do during the close of the year through December 31st. As it gets cold, I know that that will negatively impact my ability to do it.
Mike: And your motivation.
Rob: Yeah, right, both.
Mike: Yup. Yeah, I’ve definitely got some catching up to do on this. It is something that I still want to keep on track as a goal. It’s not like I want to throw this aside and walk away or anything like that. I still think that getting to 100 is still doable but I’m definitely going to have to double up my efforts a little bit.
Rob: Totally. How about your second goal which is making Bluetick profitable, including your time? Where do you think you are there?
Mike: Well, I’m not as far along as I would like to be but I still think that it’s doable by the end of the year. I’m at over $1,000 a month in revenue which I hit a little while ago, I think last month or the month before. It’s still going up. Slowly onboarding people and looking at ways to get more people on it faster. That has to do with the two-step sign up process.
Once that’s done, I’m probably going to spend at least a week or two just working on the marketing side, getting a lot of the marketing copy, and getting some videos built that illustrate how the product works and what it can do so that I don’t have to explain it individually to each person. I feel like that’s the bottleneck right now. It’s just me having to explain everything. The product itself works pretty well. That’s nice to see. I’m not afraid of it falling over and breaking if I add a bunch of people to it but I would still be concerned about adding 200 people or something like that.
Rob: Sure, but you can go slow. Yeah, it’s nice to say you’re not concerned about falling over and breaking because I remember a time, I don’t know how many months ago it was, where you were concerned about that.
Mike: Yeah. I’m definitely past that at this point. Just because the level of unit tests and just the infrastructure behind it, watching the logs, watching all the stuff that’s going on, and how much synchronization is happening between the mailboxes and stuff, I’m not seeing anything where I’m like, “Oh my god, this thing is going to fall over and die at any given time.”
Rob: Yeah, that’s cool. My second goal was to not start any new projects. It was to run the three MicroConfs, continue the two podcasts, and then working on Drip obviously, and to take a break from the chaos of launching new things. The only exception is I maybe second author on Sherry’s book, ZenFounder Guide to Staying Sane. I forgot what the title is.
So far so good. I haven’t launched anything new, I do have hobbies, I’m tooling around with investing and stuff like that, doing a lot of reading but I’m actually on track to do nothing which was the goal. Sherry is working hard on her book right now. I’m weighing in a little bit here and there which has been fun. It’s been nice to have the time to do that. How about you on your third?
Mike: My third previously was to blog every two weeks or so but I canned that about three months ago.
Rob: Yeah. Didn’t we dismiss this funnel together?
Mike: Yeah, we did.
Rob: I was like, “Why are you planning to do that?”
Mike: Yup.
Rob: It’s like Bluetick’s smart board is what it comes down to. Cool.
My third goal was to do one to three angel investments this year and I did one. I was actually a follow on round and it’s for more of a brick and mortar business in California. The first round, I was not even really an angel investor. I literally invested less than $1,000. But this round I bought a bigger chunk. I feel good about that. They have some growth in there. They’re going to start franchising which is a good model, I think, for them.
I think that’s been about it. One to three angel investments per year I think is probably my pace for now. So far, so good. I have evaluated several other opportunities and nothing has been a fit for what I want to do and has the valuation that’s in a range that make sense for me but that’s been a nice little fun side thing to do.
Mike: Do you have anything in the near horizon that you’re keeping an eye on, that you’re looking at? Or is it just completely, I don’t want to say completely empty, nothing right now that you’re looking at actively to evaluate and pursue, and you’re just looking at stuff as it comes up?
Rob: Yeah. There’s nothing in the pipeline right now. Stuff comes and goes. Someone approached me in MicroConf, we had a conversation, we exchanged the numbers, and talked about stuff. He wasn’t quite far enough along where I think it make sense for me to do it. Another one, there were a couple others where, I think I’ve mentioned this, it’s like when you’re raising at a $10 million or someone who’s at a $30 million evaluation, it’s not even angel investing anymore.
My little check doesn’t even make sense, even if you 10X it. I make a little bit of money but you have to get to $100 million or $300 million in revenue, or at least in valuation I guess, that’s not my game. My game is to invest in real businesses that are going to make money. If there’s an exit, that’s fine but I don’t want that to be the exit strategy.
You look at businesses, a lot of my recent investments, you look at Churn Buster, you look at CartHook, and you look at LeadFuze, these are business that could be as they grow that can be wildly profitable and don’t need this massive valuation or a bazillion users. They’re profitable today if they weren’t growing type thing and just reinvesting back in.
Those are the types of things that I’m looking for, and at reasonable valuations. If I’d invested at any of those at high valuation, it doesn’t make sense, you have so little of the company that you can never get it back even if they do become wildly profitable. If you make only a few thousand bucks a year back and you wrote a check for $25,000 or $50,000, it just takes too long to get paid back. That’s where it is.
I had a fourth one, it was my honourable mention. I was pretty vague about it. I basically said there’s this list of features in Drip that I want to get launched this year. I have them listed in this doc and we’ve launched one of them, we’re working on the second, and I have a third that we haven’t started yet. I actually think we’re on pace to hit all three of these by the end of the year. It’ll make a lot more sense when at the end of the year I can look back and point to these features.
I guess one of them is sharable workflows. We went live so it was not a secret at this point. I just don’t like to project a road map. There’s competitors and there’s all kinds of reasons not to do that.
Sharable workflows, which means you can take a workflow out of your account. You could put it in another one of your accounts with one click or you could share it with people, you could post it on your blog and people could import it into their Drip account. It’s also nice for internal education. It’s like we’re cranking out. We’re going to be cranking on a big library of them where you can just one click import a webinar funnel, this funnel into that funnel. It just makes a lot of sense to do that.
Mike: Cool. There’s something else you guys just launched recently, snippets.
Rob: Yeah. What’d you think about that global snippets? Yeah.
Mike: It caught my eye because I have snippets inside of Bluetick. I’m like, “Oh, I haven’t launched that. You bastard stole it.”
Rob: Oh, funny. Oh man, yeah. We’ve been working on this for a while and had it in the hopper probably four or five months ago but really buckled down on it last couple of months. Snippets are cool, man. People can use them as email signatures or they can use them as a webinar call to action, or even some people who advertise in there have a little ad unit in their newsletter could stick it in there. It’s just a piece of HTML or an image or something that you can change once and it changes it everywhere.
Mike: Got it, yeah. I basically had the same thing, but it was literally called snippets. You could just drop it anywhere. It includes the liquid tags and it can do whatever you want.
Rob: Yeah, yeah. That’s cool. There’s only one, as far as I know there’s only one competitor of ours that has anything similar to snippets. They did it plain text only so you can’t do any HTML, you can’t embed images, you have such little flexibility. We really wanted to do it, I don’t know, the right way I think and this is the way you should build this.
Mike: Am I that competitor? You’re stealing my Dropbox stuff.
Rob: No. You’re not, man.
Mike: Just kidding.
Rob: Is yours text only?
Mike: No.
Rob: Yeah. Okay, haha. No, I don’t get to. You’re in sales automation.
Mike: Yeah, yeah.
Rob: We’re in email marketing.
Mike: Yup.
Rob: Cool. Let’s dig into this article. It’s on chamaileon.io, it’s the blog. It is actually a guest post from Zoran Orack who is an email marketing consultant. He ran a bunch of tests about factors that affect primary tab placement versus promotional tab placement in Gmail.
If you’re not familiar with the Gmail multi-inbox, which I personally do not use because it makes me feel like I have three inboxes I have to check all the time, Gmail auto-sorts your email into the important, promotional, and notifications. Is that right? Is the third one notifications?
Mike: I think it’s social.
Rob: Social, thank you. Social is like Twitter, Facebook, and whatever, Instagram, all these notifications you get. I’m guessing GitHub stuff probably goes in there. Again, since I don’t use them, I’m not actually that familiar.
The curse of a lot of email marketers is if you do things, I won’t say incorrectly, but if you don’t do things smart, you can wind up in the promotions tab and a lot of people completely ignore their promotions tab. It’s where they get a lot of emails from Groupon, or from people trying to market to them. It’s not spam obviously but some people consider it when they look through and they think, “Oh this is one step above spam.” If you want to build a relationship with an audience, especially if it’s a one on one blogging relationship where you’re giving advice as a person, you want your stuff to wind up in the inbox.
There’s an argument here to be made. Let’s say you’re an ecommerce website, you’re keeping in touch, you probably should wind up, it’s probably right that you wind up in the promotions tab. Trying to game the system and use these tips to get into the primary inbox I would actually say is not a good idea if you really are just selling with your email.
Mike: I think a big point about this is really just making sure that you don’t end up in a place where people are much more likely to overlook the emails from you because you’re clearly sending them for a reason and you want them to be read. It’s not like you want these emails to go off into the ether and have nothing happen with them. If they’re not being read, if they end up in that promotions tab, and a lot of people are ignoring them, or they have much lower open rates because they’re on that promotions tab, that doesn’t do your business any good.
Again, these tests are all about at least letting you know how you can stay out of the promotions tab and what sorts of things influence that. I don’t think that any of this stuff is foolproof nor will it ever change. I think that’s one of the key points to keep in mind here is that even if you do all the right things, you could still end up in the promotions tab just because of the nature of the algorithms on the back end. All the stuff that goes into the search ranking factors, you really can’t see those. Some of this stuff is just trial and error and you may end up there anyway.
Rob: Yup. Those are all good points to make. Your open rates will be substantially less if you are on the promotions tab, just the way it works out. Some people never check their promotions tab, other people just clear it out, skim through it.
The author of this email says that Gmail is the most popular client right now. When I do a search, Litmus has the 1.29 billion opens tracked. They said it was in May of 2017, so just a month ago. They say the Apple iPhone has 31%, the Apple iPhone client has 31% of market. Then Gmail is second, and then Apple iPad, and Apple Mail.
I know that maybe the less consumer emails that are sent, let’s take for example all the emails that Drip sent last month, the majority of them are opened in Gmail. Take it for what’s it worth, Gmail is either the most popular or one of the top. Promotion versus inbox is also a big issue. In fact, emails that arrive in the primary inbox actually send a notification if people have those active on their phone and emails that arrive in the promotion tab do not.
Mike: Alright, let’s dive right in.
Rob: Cool. The author talks about how if you search Google for how to get into the inbox, there’s all the same tips. It’s like don’t sell, authenticate your domain with DKIM and SPF, greet recipients by name, have no more than one link in the email, don’t include pictures, don’t use RSS campaigns, don’t use heavy HTML, all this stuff.
What he wanted to do is just run a few tests and see if he could trigger the promotions tab. The first thing he tested, and this comes back to everything I’ve been saying for years Mike, is that heavy HTML email, it’s going to go into the promotions tab and that’s what they do. This guy, he goes into Mail Chimp, he creates a very simple HTML email, and it’s got an image but it’s definitely HTML. There’s no qualms that this is text, a text email and it’s got the share buttons at the bottom, it’s got a bunch of stuff.
All it says is let’s see in which tab this ends up. It’s got a picture of what looks like some dessert. And then cheers, and he puts his name, and it goes right in the promotions tab. This is not a sales email, he doesn’t mention products, he doesn’t have any links in the email aside from the view this in a browser, the Facebook share link at the bottom.
This is it. You’re going to hit. If you use heavy HTML and a lot of design, you are much more likely to wind up in the promotions tab. You can still use HTML, but use HTML that looks like plain text, and that is the default template in Drip. That’s why we did that is we know that it’s A) a more personal experience, and B) it’s more likely to get to where you want it to go.
Mike: He’s got screenshots in the article. If you look at the screenshots, it’s very clearly a newsletter email. CSS styles are definitely embedded into the email, there’s Twitter and Facebook links at the bottom. I’m sure there’s an unsubscribe link if they sent it through MailChimp. It’s all centered, you can very clearly see that it was sent from some sort of newsletter. Just that stuff alone, even the one without the image, it still looks like it was a newsletter of some kind. As you said like that, heavy HTML, it seems to me like just styling your emails as if it was a newsletter, that’s going to throw it into the promotions tab.
Rob: Yup. And then, he was concerned maybe it was just the image so he took the image out, leaves the rest of the heavy HTML, still goes into the promotions tab.
Again, you mentioned this could change over time, this is just one person’s test, this is not definitive by any stretch but this is what we’ve seen too. We send a lot of email every month and this is in line with my experience across tens of thousands of people sending it through our system.
Then he goes with light HTML email. He doesn’t have DKIM and SPF authentication which is where you sign it with your own domain. He just goes with, again, it looks like plain text, it is actually HTML, similar to the Drip default template. I’m sure you can get these templates in Mail Chimp as well. Sure enough, I think it’s the exact same text, and it is the exact same text but it looks more like plain text. It winds up in the inbox.
The only link in there is an unsubscribe link because it was through Mail Chimp. It has the Mail Chimp image at the bottom, the share link there, and that’s it. That’s the simplest way to get in the primary tab.
Then he wanted to run another test and he added more formatting, he added several bullets, he added a hyperlink that just said click here for more info, and he started pitching. He says, “The best product everyone enjoys just got better. Here’s some features that you like, features you beg for.” He’s being silly with it but he definitely is pitching a product. He even includes a price in the email and he had a sale-sy subject line. There it is, he still made it into the primary tab.
Mike: I do wonder how much of an impact it has that he’s sending the same email to himself multiple times. I wonder if there’s anything in the algorithms that look at how much email you have received and have opened from a particular source. I’d be curious to know whether that has any sort of impact.
My feeling is that in looking at emails that I’ve received or that I have sent, the more that something has been opened, the more likely it is to appear in certain places inside your email, or the more likely it’s going to not be classified as spam. Because obviously, there’s learning algorithms behind it. I don’t know how across the board those are or if they are localized to just your account based on what you open or what you tend to open.
Rob: Yeah. I agree with you. What you’ll see is when we get to the end, he’s continued to send the same way and he trips one filter and it goes to promotions, even after he sent all these emails. It helps disprove that thought.
My theory on this, again this is based on seeing a lot of email get sent, is that doing just a few emails isn’t going to give you the positive reputation if someone opens a few of your emails. If you’re sending mass emails, Google knows if you’re sending 10,000 or 20,000 or 30,000, I believe. I think that if you have low engagement with those, that they do start to see that as a signal that your stuff is lower quality or that people aren’t engaging. By engagement I mean opens and clicks.
I don’t know, the author of this article is sending five, six, seven emails which is what he did with minor variations over the course of a few hours. I just don’t think there’s enough data there that Google would really, really engage with it. Obviously there’s a chance that they could say, “Well, if it’s from this sender and you’ve opened their email in the past, then it’s more likely to go to the inbox.” That would be intuitive. But again, he trips a filter here in a couple examples that we’ll get to, and it goes right to promotions. That almost dispels that. It almost makes me think that Google needed more data in order for their machine learning to form an opinion on it.
The next step. He had plain text that was formatted, he included a price, and a link, and it was still in the inbox. So then he decided to add images, he added two images, he left everything pretty much the same, still went into the primary inbox.
Mike: He removed the price though.
Rob: He removed the price. That’s right, he removed the price, he added images, went into the inbox, and this is where he trips it. With the image and the plain text, he added a price, and then it went into promotions. It’s really interesting.
Once you’re going with the plain text look, remember, again, it’s an HTML email, it’s just not heavily formatted, you’re in the safe zone. You can add images, you can add formatting, you can add links, you can add bullets, doesn’t matter. At least again in this example, it didn’t seem to have an impact but he added an image and a price, and that seemed to send him in. That’s pretty interesting.
Mike: Yeah. That’s what I would almost expect from something like that though. You get a newsletter from a retailer or something like that, it’s probably going to have an image or a picture of what it is that they’re trying to pitch you, and a price associated with it. Intuitively, that makes a lot of sense that that would have triggered it.
Rob: Right. Again, this is the promotions tab. The whole point is it’s people trying to sell you stuff. If there’s a price in an image, that lends itself to doing that. I don’t think there is two if statements in Google’s algorithm that says, “If image and price, then promotions.” It’s a big ass machine learning algorithm. That’s how they work. There’s some bayesian filtering going on and I think that’s what it’s picking up.
One of the last test he runs, I guess it’s the last test, is he’s trying to refute the RSS to email thing. People had said if it’s RSS to email then it’s going to go straight to promotions. He does an RSS to what looks like a plain text email. Again, it’s html. Of course, it doesn’t set off the filter. It goes straight to the inbox, which would make sense.
I’m not a fan of RSS to email because I think it’s not a very personal way to engage with your list but I don’t think that Google really cares that much about it. Since a lot of RSS email is bloggers anyways, that’s often not promotional content. You’re not selling stuff. You’re often giving valuable information, writing an article, offering advice. You can debate whether that’s promotional or not but personally if I’m subscribed to someone’s’ list, of Brennan Dunn’s writing or Ruben from Bit Sketcher, Hiten, I want that in my primary. That’s important to me. I’m not subscribed to a bunch of list that I don’t want. If I was, I would unsubscribe from them.
Mike: Yeah. I’d be curious for that specific example, the RSS, if you were to also add in the images and the price of any kind or multiple prices if it would trigger, it seems like it should.
Rob: Ah, it should, yeah. I bet images would be fine.
Mike: Yeah. I think you’re right. I think the images would be fine. I think possibly a price might be fine but I wonder if they take into account like how close it is to a link as well. I don’t know. That was something I noticed about the emails. The price was not necessarily right next to the link.
Rob: Yeah. Or the image. It’s not like it was clustered together like it was a product. It just happened to be in the same email.
Again, we will link this up in the show notes if you do want to see the screenshots and the emails. It’s a fun little romp through and it does confirm a lot of what we’re seeing in the space as well.
Mike: I think that one of the directions that all the stuff leads to is just providing value from the emails that you’re sending to people so that you don’t end up in the promotions tab. You can sell to some extent but you have to be delivering value to people in order to get them to engage with your emails to begin with. If you’re not doing that, then it’s a promotion. Chances are it’s going to get chucked out with all the rest of the advertisements.
Rob: Yeah. Another thing to think about is each of these things is a signal. Although he says you can get into the inbox without SPF, DKIM, the SPF, DKIM is not a bad thing to set up. It is going to be in general a positive signal to someone like Google.
I also think this is where people don’t prune their list enough. I think this is one of my soap boxes is if your open rates are less than 10% on your list, you need to prune that thing, because Google is smart and so are the other inbox providers. They’re starting to catch onto this stuff. If they see you have a mass mailing and very few people are engaging with it, they are going to start to putting you in spam or in promotions.
In my opinion, you should have open rates above 20% but there’s a grey area there between 10% and 20%. That’s where pruning can help with engagement and therefore help get you out of some of these sticky situations that you can wind up in if you’ve kind of not been cleaning your list.
Mike: I think that about wraps us up for the day. If you have a question for us, you can call into our voicemail at 1-888-801-9690 or you can 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 the full transcript of each episode. Thanks for listening. We’ll see you next time.
Episode 344 | 9 Summertime Productivity Tactics
Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike talk about 9 summertime productivity tactics. As summer gets into full swing and the weather gets nicer, these tactics will help you stay productive all summer long.
Items mentioned in this episode:
Transcript
Mike: In this episode of Startups For the Rest of Us, Rob and I are going to be talking about nine summertime productivity tactics. This is Startups For the Rest of Us episode 344.
Welcome to Startups For the Rest of Us, the podcast that helps developers, designers, and entrepreneurs be awesome at building, launching, and growing software products, whether you’ve built your first product or you’re just thinking about it. I’m Mike.
Rob: And I’m Rob.
Mike: We’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s going on this week, Rob?
Rob: Well, you remember how I was sick last week, over the weekend, I don’t know if it became or developed or if it always was but I basically got strep throat again. I have never had it in my life and then I have had it twice in the past eight months. Both of the times, it has been our six year old’s class, we get an email that’s like strep throats going through our class. My six year old is like a carrier. He doesn’t get it but then I wound up with it both times.
I was wrecked over the weekend, sleeping. Basically, in and out of consciousness and Sherry on Sunday morning was like, “Dude, you have to go to urgent care.” Both times I’m like, “Ugh, it’s such a waste of time. I’m not that sick.” She’s like, “You’re a wreck.” Sure enough I go in and did a test. 10 minutes later, they’re like, “You have strep.”
Mike: That sucks.
Rob: But the good news when you have it is that they give you antibiotics and it fixes you up right away. Within six or seven hours of taking the first pill, I felt quite a bit better and then the next day, you’re up at 60%, 70%. The day after, you’re 80%. It’s a much faster recovery if you can use the antibiotics. That was that. It was a bummer. Half speed this week because of it.
Mike: If you’d only gone in like three or four days in advance.
Rob: I know. When I still felt fine, when I just had a head cold.
Mike: It could be worse. At least you’re starting to get over it now.
Rob: I know. I do feel better and I’m really enjoying the summer. I think it is because we live now in a place that has more broader seasons or more noticeable seasons, but I just don’t remember having this kind of euphoric feeling of like, “I want to be outside all the time.” Right now, I’m actually not sitting in my office. I’m sitting out on a deck overlooking the street, the trees, the breeze, and stuff. I just didn’t used to do that as much because year round in California, you can be outside but there’s just so much going on right now.
It’s an interesting thing. I feel like I’m working a little bit less and I want to work a little bit less but during the time that I’m working, I’m hyper productive, hammered out. Honestly, it felt like a day or a day and a half worth of work the other day in four or five hours. I was just that full race car speed and all the stuff poured out of me. I had this to do list that I expected to take literally multiple days and I just hammered everything out. I think it’s part of this vitamin D and being able to easier exercise and all that.
Mike: One of the things that contributes to that or could contribute to that is the fact that like you said, when you lived in California, it’s almost summer time the year round and our brains act as a difference engine where we are able to notice stark changes but if there’s gradual changes, we don’t notice them nearly as much. That’s probably a contributing factor to how you’re seeing things different in Minnesota versus California.
Rob: For sure. How about you, what’s going on?
Mike: I think last week I talked about how it was probably going to take me at least a week or two to get my self-signup process and I’m probably about halfway done after working about a week on it.
Rob: Why does that take so long? It doesn’t seem like it should be that complicated.
Mike: You wouldn’t think. The issue is that a subscription inside the software was originally tied to a user. What it would do is it would create the subscription first and then create the user. It was just because the way things were built early on and because I’m decoupling that where you have to create the user account first like there’s no backend subscription that it’s tied to. All these other things break because of that. I’m going through it.
I’m kind of hacking things together. There are a lot of things that I’m overlooking and making this blanket assumption that just says, “Look, if you don’t have a subscription ID, then you really don’t have an account. You’re just not going to be able to login,” which makes complete sense. It’s just that there’s that decoupling right now that a ton of code had to change to make that work. Just because database constraints and things like that.
Rob: Got it. You’re not just building a time flow. You are refactoring your data model and then building that. Is that correct?
Mike: Yeah.
Rob: That makes sense. We went through a couple of these really early on with Drip and I remember Derek spending like a month and a half twice, at two different times basically trying to decouple things in the data model because we, together, had just made the wrong choice early on. If you’re doing that, that makes sense but I would separate that in your head like, “Alright, this is a necessary refactor,” because that’s going to make everything better long term if you decouple the subscriptions from users. It’s going to give you more flexibility.
We can talk offline. It would be probably boring to talk about it in the podcast but just how we architect it in Drip where you can have a bunch of different users and subscription is the master and then there are accounts which are a separate thing. That’s what’s in the drop down list in the upper right and how they’re all many, many in essence and I guess given us a maximum flexibility to allow agencies to have the flexibility to do what they want and individuals for it not to be too complicated and that stuff.
I’m assuming that’s the direction you’re headed. As long as you have it on the back end, as long as your table structure supports that, you don’t even have to build the code to do it yet but obviously changing the data model later is really time consuming. That’s what you want to do.
Mike: All the stuff and the data model, that’s exactly what I’m dealing with right now. I knew in the longer term that it would be an issue but I kept pushing it off and pushing it off. Now, I have to bite the bullet and just say, “Alright, I got to do something about it.” There are hundreds and hundreds of places where the subscription ID is referenced directly on the user account. It shouldn’t be there. It never should have gone there but I don’t want to go through and make all those changes now because one, it’s time consuming and two, it’s going to be risky, to be honest. I’m pushing some of those things off and refactoring some things and just making that assumption that, “Hey, you have to have a subscription ID in order to log in.”
Rob: And hopefully writing a lot of unit tests.
Mike: I’m definitely adding unit tests to this one.
Rob: Cool. What are we talking about today?
Mike: With the onset of summer, I’m sitting here next to a giant window that looks out into my backyard and I’ve noticed that the day has gotten progressively nicer and nicer. Even in New England, sometimes it just rains right up until early summer. In fact, it was still raining pretty continuously for the last couple of weeks so earlier this week it started to clear up so I’m looking out the window thinking to myself, I’d really like to be outside right now.
I thought it would be nice to go through some summer productivity tactics that people can keep in mind. I realize this is only applicable to probably half of the world because people on the other hemisphere are going into winter at this point but at the same time, these types of tactics you’re going to apply as you’re going into summer whether that’s now or in six months.
Rob: Sounds good. We have nine summertime productivity tactics. Let’s dive in.
Mike: The first one is time box your day. Essentially what this is is putting a hard stop on the end of your day so that you know that at some point, you’ve looked at the clock and you know what that time that’s going to be, that’s the end of your work day. This is I think especially important for people who work from home or out of a home office and have a lot of more flexibility and can find themselves in a situation where they’re working extended hours because they really want to get something done.
The idea here is really just put that hard stop on the end of your day. I think this is a general tip that is a good practice to follow but I think it’s more important in the summer time especially when you’re looking out the window and there’s this draw to go outside just because it’s nice out and you really don’t want to be spending the time in front of your computer.
Rob: I think it’s important to do this and I think if you have flexibility with your schedule, that cuts both ways. It’s as much of a curse as it is a blessing. Probably the best way I found to approach it is to think of the day in three chunks, three four to six hour chunks. There’s your morning, there’s your afternoon, early evening, and then there is your evening or late night.
I don’t like to work three of those in a row. You can work up to two in a row. To be honest, when I was younger, when I was in my 20s, I was a momentum player. I would love to do these long, 15 hour sometimes longer work days and then take the next day off. I don’t so much enjoy that anymore and you have to be doing some pretty specific tasks in order to do that. I used to be able to write code like that for an extended period of time but you can’t be creative for that long. You just don’t have the juices.
Nowadays, I think I can work any two in a row and then I need to take the third off. If I work afternoon, evening, I’ll take the morning off. I don’t do that as much anymore now that we have more of a normal schedule. But you get the idea here. I think that time boxing your work day and getting the maximum productivity out of let’s say the four to eight hours that you’re going to work in a row, which is what I recommend, I know a lot of founders who work for four to six hours a day and get a ton done.
I think if you actually think about what your day looks like, if you’re sitting at your desk for eight or nine hours, if you’re really hammering it, you could probably get all that done if you didn’t have any distractions and minimal interruptions and you just went full force with the music and the caffeine and just went in the zone for a good solid four hours. You can get as much done as you can in a full day of screwing around. Time boxing is something I definitely believe in.
Mike: The second one on this list which probably should have been first was to keep what’s working. Really what that means is don’t throw away all the productivity tactics and hacks that you’ve put together over past the six months to a year because it’s summer time. If you got those to the point where they were working for you, whether that’s getting up early, or taking a break at 11:00AM for an hour, or taking an early lunch, things like that, if you find that those particular things are working for you and have worked for you, don’t just immediately throw them away because it’s summer time.
There are situations where really readjusting your schedule and doing a complete overhaul on it are warranted but I wouldn’t say that going into summer is one of those things. You can play around with things, experiment a little bit, but I wouldn’t make such a drastic change unless there were some major reasons for doing that. Like you’ve got into a car accident and you’re on crutches for a while or something like that. You don’t have that with the summer time coming.
Rob: The third tactic is to take outdoor breaks. Maybe you’re eating lunch outside, maybe go for a walk before or after lunch or an early afternoon when you start to get tired. Early afternoon, it’s a tough spot coming back into work. You can use this time to think about hard problems while enjoying the weather and getting some vitamin D.
To give an example of this, this morning, I was sitting outside. I was drinking coffee. I was thinking about stuff. I did a little bit of email. I responded to everybody’s Slack messages and then I had a hard problem that I wanted to think through so I hopped on my bike and I rode around this lake that’s right near us. It’s called Lake Harriet. Literally, from the time I jumped on the bike until the time I got back into the garage, it was like 20 minutes, maybe 25 minutes but it was a perfect amount of time for me to think through this issue and it was very much like when you have major epiphanies when you’re in the shower, when you’re doing dishes. Bike riding is the same for me.
It could be walking. It could be running. It could be whatever but just being outside for those few moments really kicked my day off in the right fashion. By the time it was 10:00AM, I was highly motivated to come back and just hammer out a bunch of stuff that I had to get done.
Mike: I remember when I used to work at a pedestal software. One of the things that we would do, the guys that I’ve worked with on my part of the engineering team, we basically take a walk around. There is this interloop inside the office campus that we’re at and every day after lunch, we would just take a couple of laps around that and just talk about some of the different things we were working on and it was really nice and motivational to have that time not just to get the outdoor time but also to talk about the things that we were working on. It was almost like a mini meeting but we were getting that a little bit more of a creative spark by being outdoors.
The fourth tactic is to change your working hours. Some companies refer to this as summer hours but I think that there are a lot of different variations that you can put on to this tactic. The first variation is two four day work weeks. You can take Wednesdays off or Fridays off. Most companies will take a half day on Friday but you can also do other things. You could say, “We’re going to do six hour work days instead of eight hour work days.” And then you do that every single day of the week.
Or you can shift your schedule a little bit and get up and start working at 6:00AM and you can be done by 3:00PM or 4:00PM or just start later and end earlier. There are a lot of different ways to play around with the schedule but just shifting your schedule a little bit to give yourself more time during the summer to enjoy the summer, all that’s going to be very helpful and beneficial for your motivation.
Rob: If you’re in control of your schedule, if you’re founder, you have flexibility, now is the time to do it. Now is the time to take that extra day off to shorten your days. You’re not going to regret it. I guess that’s what I’ll say. It always sounds scary to think about changing your work schedule and that you’re not going to get as much done or you’re competitor is going to catch you or whatever, it’s pretty unlikely.
You can always change. Try it for two weeks, maybe a month, somewhere in that range and just commit to doing it even if it feels weird, even if you don’t love it, commit to doing that and then figure out if you actually are enjoying the summer more.
The thing is you need to figure out something to do with that time. The hard thing is if you work for four or six hours and you say, “Alright, I’m not going to work.” You have to now go ride a bike. You have to start playing the guitar. You have to go paddle boarding. You have to fill that time with something. Otherwise, we all naturally will revert back to working. Fill it with a hobby or exercise or something so that work doesn’t constantly pull you back to the laptop every time you see it.
Mike: There are other things to keep in mind when you’re doing that is that that time is really spent rejuvenating your mind and mental energy. It’s not as if you are at a dead stop at that point. It’s like you’re really recharging your batteries. This analogy came to me the other day where if you’re doing a cross country trip and you need to maintain an average of 50 miles an hour, if you stop for four hours, your average speed at that point is zero. But the reality is you are allowing yourself to be able to move faster in the work context when you take those breaks.
If you do those in the middle of the day, you’re going to be able to move faster and make better progress while you’re working versus having your progress decrease over time throughout the course of the day so that by the end of it, you’re only operating at 10% or 20%, when if you took a break in the middle, you’d probably be able to get yourself back up to 70% or 80%. It’s really just a balancing act and being able to rejuvenate yourself as part of that time that you’re taking off.
The fifth summer productivity tactic is to schedule your vacation time. I think this is something that most people will probably have done quite a bit of by now. Like we plan our family vacation probably six months in advance so around January or February time frame but these are the types of things that allow you to get out of the office for an extended period of time. It’s not just the weekend or a couple of days in the middle of the week. Usually, you want to take several days off in a row in addition to the weekend. We try to take at least a week off. If we can do more, we will, but it really depends on what other things are going on.
Now that my wife owns a business and I own my own business, it makes the scheduling a little bit more difficult just because of all the different things that are going on. You really want to be able to take these times and schedule those vacations with everybody so that everybody can just enjoy the time off.
Rob: Our sixth tactic is to learn something new. This goes along with what I said earlier about learning to fill this extra time that you’re going to eek out of your day. Learning something new obviously can be motivational, so consider spending some time this summer learning a new skill that you can put to a good use during the summer. Later on learn to play the guitar and then you could play now on the outdoor patio and the during the winter when everyone is sad and it’s dark and cold, you can sit inside and play. Or again, pick up paddle boarding or get a bike.
About a year ago, when we moved into Minneapolis, we’re near some lakes, Sherry bought two stand up paddle boards and within a couple weeks of us getting here, I’ve actually quite literally picked up the guitar again. I used to play all the time. I was in a couple of bands years ago. I’ve been picking it up lately and just learning new songs. It’s been fun.
I actually got a road bike. I’ve had a comfort bike for a long time but these things are so heavy and I’ve been riding back and forth because there’s bike trails basically from my house to work. It’s about a 25 or 30 minute ride. My big comfort bike was so heavy that it’s taken like 45 minutes because I just couldn’t get the big ol’ steel frame going fast enough.
Sure enough I talked to Anne on the Drip team. She’s big time into cycling. She gave me some recommendations. I got a really nice road bike off Amazon for $550. I say it’s really nice. For me, it’s really nice. It’s an entry level road bike but this thing is awesome. It’s super light and it feels like a kind of a neat little new hobby to be able to ride this bike around.
That’s what I’m saying. Like this morning, I actually don’t like exercise. It’s not something I enjoy. I’m not into it. People say, “My day is a wreck without exercise.” Mine is not so I have to force myself to do it. I used to play sports in college and what I liked about that is it forced me to exercise basically. I loved being around the team and I love the competition. I didn’t actually love the physical exertion. It’s just not something that I naturally need.
Having a bike around or this lake or just some outlet has been this excuse for me to get outside, move around, get the endorphins pumping and staying in some kind of shape. Of course summer is the time to do that right after several months of being indoors during the winter.
Mike: Instead of taking 40 minutes to get to work, it only takes you 38 because you’re old, right?
Rob: Yeah, exactly. Nice one. No, I get there in about 25 on a good day and 30 if I’m taking it easy. It works out nicely. Given that the ride is about 25. My drive to work is like 16, 17 minutes with no traffic but on the drive home, it’s 25 to 30 with traffic so it’s essentially equal but I get the exercise out of it so it’s pretty fun.
Mike: The seventh tactic on our list is to schedule fun time. This could be specifically summer fun time or something that you dedicate time to on a regular basis. One of the things that I enjoyed doing lately is there is a local meet up where they play board games. I’ll go there on Friday nights but during the summer, you have a lot more options so whether that’s riding your bike.
We have a pool as well so our kids love going swimming in the pool pretty much all year long. Right now, it’s kind of cold. It’s probably mid 60’s right now, pretty close to 70 I think in terms of the pool water. But as the summer marches on, it’s just going to get warmer and we have a pool cover. It’s going to be nice to be able to go out there and just hang out by the pool for a little while. We typically have friends over on the weekends, most weekends I’d say, but there are also times where they’ll just come over in the middle of the week because it’s summer vacation so the kids don’t have school. They just come over and do their thing. It’s nice to be able to sit there and just take the time in and enjoy the nice weather outside. That is essentially scheduled fun time at that point.
Rob: I think doing something at least once a week is a good way to think about it and a good way to map it out. In the past couple of weeks, some things that I’ve done is during my work day the other afternoon, on one of the work from home days, I went to this super cool coffee shop. I got some iced coffee. Normally, my afternoons are not as productive as my mornings but this afternoon, it was. It’s that new environment where it inspires creativity or there is something about the chaos of being in a new place and of course getting lightly caffeinated in the afternoon was great.
We have been going to, there are these outdoor concerts at the Lake Harriet band shell here near our house. There’s like five nights a week of different bands. There are cover bands. There was a Beatles cover band. There are drum circles and all kinds of stuff so we’ve been riding over there. It’s about a five, seven minute bike ride so we’ve been taking the kids after school. We’ve been swimming in the lake, that kind of stuff.
It’s like having one or two of those a week to look forward to as a family. We’re also doing Monday night is family movie night and we’re watching movies about historical things of like people doing hard things, overcoming hard things. We watch Hidden Figures, about the African American women in NASA, we watched Apollo 13, that kind of stuff. People struggling. It’s like lessons for the kids but it’s also good films that we want to see.
Getting some stuff, this is also good to do in winter, to be honest. We were doing some of these things especially the indoor things in winter just to have something to look forward to each week but it’s definitely time to up your fun game.
The eighth tactic is to revisit your annual goals. We’re getting close to the midway point of the year and you want to revisit them now so that in September, you don’t have to cram six months of work into three or four months. In fact Mike, you and I should maybe, just at the beginning of next episode, do a little touch base about where we stand with the goals that we set forth last December.
Mike: Sure.
Rob: This is a good time to do it and you’ll either find yourself well ahead of schedule or you will remind yourself that you are not actually exercising twice a week or that you’re way ahead. It’s always good to reflect on these every couple of months and summer is a good time to do it.
Mike: Yeah, I’m definitely a little bit behind on my exercise schedule but part of it is due to my shoulder being out of commission for the past six months.
Rob: Mike, Mike, Mike, oh man.
Mike: I know. I’ll get there. I’m not too far behind but it could be worse. Anyway, back to our list, number nine is to allow for cheat days. Essentially what you’re doing with a cheat day is giving yourself permission to just throw in the towel on any given day for whatever reason you feel like and just walk away and do anything that you want at that point. Really, the idea here is setting up those rules in advance so that you don’t feel guilty about taking that time off.
If you’ve already given yourself permission to take time off whenever you feel like it because something came up that you just want to go do, whether that’s just going to see a movie in the middle of the day or going out running for example, if you have like a nature trail nearby, you want to go run through the woods or if there’s a hiking trail, you can do that as well. Go to a pool. Go to a basketball court, anything along those lines.
The bottom line here is just giving yourself that ability to do those types of things in the middle of the day and just call it quits on the day without feeling guilty about it. That’s a huge piece of this.
Rob: Is the gist of this episode that we’re telling people not to work during the summer?
Mike: I don’t want to say that. I don’t want to go that far. I think that looking around, what I’ve seen historically over the past couple of years is that business for people like you and me, it feels like it ramps down a little bit during the summer time. It doesn’t seem like things are picking up. It’s not like the beginning of the year or after summer time where things are really picking up and the pace is hectic. It feels to me like this schedule seems to be much more dialed back in the middle of July for example.
Same thing happens for a lot of businesses, second or third week of December. The businesses, they don’t do a lot, at least not our types of businesses. The demands are a lot less pressing and you can take it easy. I think that it’s a good time to recharge your batteries and not put the pedal to the metal because you don’t have to. There’s no real driving force to make you do it. Everybody needs a little bit of time off.
Rob: It’s interesting that the advice of only working let’s say six hour days, I actually think that for a lot of people, that would be better year round. That you would actually get more done with more focus time if you time box your day, if you got out and did some exercises instead of sitting in front of your computer for another hour clicking around on social media or doing whatever you’re doing when you’re getting distracted. This is stuff that can apply if used well. It can apply and actually improve your productivity in a counter intuitive way, meaning working shorter days. I believe you can actually get more done because you can be so focused about it.
That about wraps us up for today. If you have a question for us, call our voicemail at 888-801-9690 or you can 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 the full transcript of each episode. Thanks for listening. We’ll see you next time.
Episode 343 | Growing from $1k to $5k MRR, Projecting SaaS Revenue Growth, Refining Your Sales Process, and More Listener Questions
Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike talk about growing from $1k to $5k MRR, projecting SaaS revenue growth, refining your sales process, and more listener questions.
Items mentioned in this episode:
Transcript
Rob: In this episode of Startups for the Rest of Us, Mike and I talk about growing from $1,000 to $5,000 of MRR, projecting SaaS revenue growth, refining your sales process, and more listener questions. This is Startups for the Rest of Us episode 343.
Welcome to Startups for the Rest of Us, the podcast that helps developers, designers, and entrepreneurs be awesome at building, launching, and growing software products whether you built your first product or you’re just thinking about it. I’m Rob.
Mike: And I’m Mike.
Rob: We’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s the word this week, sir?
Mike: I’m hoping that in another week or two, I’ll have my completed self sign up process in place. It’s been rather painful to rework those pieces of code just because it’s core to somebody signing up so it has to work properly. I’ve found places where if the signup process previously had failed, at some point along the way, it left a bunch of orphan data and I’m like oh God. And then you start over and then it leaves all these things in the database and I’m just like, “Alright, I got to start refactoring some of that stuff.” The cleanup is kind of a pain in the neck but things are progressing pretty well at this point. I’m hoping to have that cleaned off of my plate in the next week or two.
Rob: That’s nice. One thing that we do, we have a two step sign up process for trial. If they do the first step but don’t enter their credit card, we cookie them. If they come back, we just present them with the credit card. We don’t want to make them do the first step again.
Mike: That’s sort of what I’m looking for right now but I’m looking for ways to create the account and have it as a placeholder without also creating a subscription inside the system. That’s the part that’s hanging me up a little bit. I’m trying to figure out exactly how to do that. The cookie idea is interesting but at the same time, I don’t necessarily want to leave their credentials sitting there in a cookie or someplace either.
Rob: Oh yeah, no. We store it in the database and then cookie them with an account ID or at least a user ID. We wouldn’t store that in a cookie. It’s just an idea. It’s a nice elegant way. Some people will come back and be like, “I can’t believe it. I didn’t have to enter my stuff again to get in.” It’s like a usability thing for people who get stuck in the middle with the credit card and then come back a few hours later and see that it’s already there at the credit card screen.
Mike: Yeah, that’s exactly what I’m looking for. I’m looking at trying to get around because like I said, data structures don’t really support that just yet.
Rob: Got it. That’s a bummer. For me, you probably hear, I’m sick this week. I’ve been working but I just kind of feel hazy and everything is just taking longer to get done. I hate being sick a lot because I feel like I have a bunch of work to do. I got things to do. Who’s got time to be sick these days?
Mike: My son was sick this past week so he was out for one or two days at school.
Rob: That’s crazy. We went to California last weekend for Memorial Day and pretty much my whole family got, it’s just a head cold, we all got it. I don’t know. We had it within the first day we were there so I feel like we caught it before we left. I don’t think you catch it on the plane and then the next day you wake up. I think there’s a longer incubation period for most colds so the timing was kind of bizarre but it seems to be hitting each of us in its own way right now. But the show must go on. Am I right?
Mike: Yes.
Rob: Every week. Every Tuesday morning, we get this podcast out. Apologies in advance if my voice grates on people, I am heavily using the mute button to cough while you’re talking right now.
Mike: What are we talking about this week?
Rob: We have a nice backlog of listener questions once again and so I wanted to run through some of those. Actually, there are a couple that really aren’t questions. They’re just comments and accolades for us. This first one is a voice mail about growing from $1,000 to $5,000 of MRR.
Bryan: [Voice mail] Hey Rob and Mike, Bryan Fleming from Detroit City here. I just wanted to call and say thank you so much for the podcast you guys put out. Being here in Detroit, you just don’t talk to anybody who’s doing the SaaS stuff. It is so goddamn hard.
I’ll tell you what guys. A year ago, I was listening to your podcast, struggling along my SaaS business, doing about $1,000 a month. I listened to an episode where you guys were talking about how to know if your business is viable and sketching out your lifetime customer value on a napkin. I did that and it’s like a lightbulb went off. I moved to a yearly re-bill. I increased my prices and here I am a year later, my business went from $1,000 a month to $5,000 a month. I know you guys have seen ones that have grown better but I’m pretty proud of it.
Again, it’s all from listening to your guys’s episode, that was one in particular. I appreciate everything you guys do like I said. You’re the first one I go to on my podcast, really looking forward to it every week. Keep up the great work guys and when I do have a question, I’m going to call back in and hit you up on it. Take care. Bye.
Mike: That’s good to hear. It’s always nice to hear from listeners who listen to an episode and that are able to act on that advice or the commentary that we give and be able to take things to the next level and really move their businesses forward. I really appreciate hearing that from you, Ryan.
Rob: Yeah, that’s awesome. That’s really why we do it. The fact that anyone ever gets value out of anything you and I say, Mike, it’s just a miracle at this point. Our next question is about how to project revenue growth? It’s from a friend of the show, Craig Hewitt. He’s the founder of Podcast Motor at podcastmotor.com.
He says, “Hey guys, after launching my first SaaS product last week, I’m wondering what realistic ranges for growth scaling are. Heard Mike talking about doubling Bluetick revenue from $1,000 to $2,000 in a month on the last episode, it seems like a great goal but is that kind of expectation realistic? Does the same growth curve slope apply at scale? For instance, did Drip see 100% growth months after you were doing mid five digits a month? Be interested to hear your thoughts.”
Mike: For mine, I looked back over the revenue numbers for Bluetick after I started officially selling it to people. There were a couple of months where I did 100% month over month growth but it was not common. It was like I would get 100% one month and then I would double it and then the month after that, I get like 50% or we just stay even in terms of growth.
There is this exponential curve that you end up getting. Depending on which numbers you’re specifically looking at, whether it is growth from one month to the next versus your total size, those are two entirely different things. What I was looking to do was originally, I was saying, “Okay, I want to go from $1,000 to $2,000.” But even a couple of days later, I looked to that and said, “You know what? That’s actually not very realistic.” Because in my mind it was like, “Oh, I’ll be doubling my customer base.” But the reality is that doubling the customer base is not realistic because it took me x months to get there.
What would more realistic is if I were to say, “Look, I want to double the number of customers that I got last month.” That jump is probably too large. If it takes you four months to get to 20 customers, you’re probably not going to be able to add 20 customers in the next month barring some major marketing strategy that you do or a big launch or something like that. That’s not what I had planned. I realized a couple of days later that that was not going to be a realistic goal.
Paul Graham has some advice about the growth rates for Y Combinator start-ups. They’re looking for 5% to 7% growth per week and he says if you can hit 10% a week, you’re doing exceptionally well. If you can only manage 1%, that’s a sign you haven’t yet figured out what you’re doing.
In the early days, I think it’s a lot easier to get those higher percentage growth numbers just because adding 1 person if you’ve got 10, then that’s a 10% growth rate but once you get to 100, adding one is only 1%. Again, you have to look at both the total size that you’re trying to grow and then back track a little bit and look to see how long it has taken you to get there in order to be able to start projecting forward and establish more realistic goals.
Rob: Yeah, there is kind of early stage growth where you’re just scrapping for every individual customer and it can be a little harder to project at that point. But if you have a nice source of folks that you can bring in almost by hand where you have that 300 person launch list or something and you’re kind of individually choosing people out of that, then you kind of get a feel for how many you can logically bring in in a month.
Once you’re past that, let’s say you’ve launched and you start marketing. You have content marketing. You have Facebook ads. You have SEO. You just have all the channels. You’ll start to see that the numbers just pan out. Depending on the number of unique visitors you get to your site, what percent convert to trial or a customer and you can just look at those numbers and that will allow you to start projecting how in a month, two months, three months and then you’ll be able to see which levers you need to pull in order to increase that. This is where it becomes easier to project but harder to make a dent because adding one, two, three customers doesn’t make a dent when you’re going $5,000 a month MRR.
Now, to really dig in on Craig’s question. He’s asking, “Can you have 100% growth once you’re already doing $50,000 a month?” The answer is not typically. That’s not really a sustainable growth pattern. Don’t think of it in terms of percentages. Think of it in terms of flat dollar amounts.
In the early days, I would shoot for if you can get into four figures of monthly MRR growth, you’re doing okay. Early days is like sub 10,000 or 15,000 of monthly recurring revenue. If you can grow at $1,000 or $2,000 a month during that time, I don’t think of it as a percentage. I just think of it as getting the $1,000 or $2,000.
If you can get to that and make it sustainable so that it’s a flywheel in essence that grows at $1,000 to $2,000 a month, that’s a pretty decent start. If you look out a year, then you think, “Wow, I’m going to have grown $12,000 to $24,000 MRR.” And then what you do is you look at how do I know get to $4,000 or $5,000 MRR and then how do we get to $10,000 MRR growth.
The sooner you can get there, your growth will be huge at first. Let’s say you get to $20,000 MRR and you’re growing at $5,000 a month, man, you have a 25% growth rate. But then next month, you’re going to have a 22% growth rate. And then the month after, if your growth stays flat, you’re going to be at 18%. It’s going to get smaller each month but if you’re still growing at $5,000 MRR, that’s actually a pretty damn good bootstrap business. The percentages start having less of an impact at that point or I should say less meaning because if you continue to grow at $5,000 MRR every month, that’s a good business.
At a certain point, your churn will make it so that your $5,000 MRR growth will get smaller and smaller over time. That’s really a whole separate conversation. That’s when you hit a plateau and there was an episode we recorded probably 100 episodes ago with Reuben Gomes about how to see plateaus coming and how to get over them.
I guess what I’d encourage you to do, Craig, when you’re thinking about this is think about it in terms of absolute dollar amount. People say percentages because A, it sounds impressive or B, they want to not give absolute revenue numbers in public. When I used to talk about Drip’s revenue growth on the podcast, I didn’t want to say we’re growing at $5,000 or $10,000 a month so I use the percentage instead.
But realistically, the absolute dollar amount especially for a bootstrapper in my opinion is what counts because that dollar amount is what allows you to hire people, it’s what allows you to buy Facebook ads, it’s what allows you to run the business whereas percentages really have just such a smaller meaning. You do hear about Y Combinator start-ups or even some bootstrap start-ups that get really good traction.
Growing 20% to 40% a month for a while is totally doable. It’s hard work and you really need to catch a flier. It’s a Cinderella situation but it is possible for the time being but growing 100% month over month for more than just a few months is unheard of. I think you would literally need to be like an Uber or something to be seeing growth like that. I hope that helps, Craig. Thanks for the question.
Our next question is from Chris from vendorregistry.com. He says, “I’ve been thoroughly enjoying your new podcast. I heard you were looking for some questions. Vendor Registry’s SaaS platform and marketplace streamlines the $250 billion dollar local government purchasing market by standardizing and centralizing traditionally paper intensive workflows. Since we have so much green field ahead of us, coming up with new ideas takes only 10% of our time. The other 90% is spent debating which ideas to execute first. Ideally, we stop debating. We let the market decide through AB testing however, implementing AB testing requires money for the tools dab time to build out two versions of everything and enough users to generate actionable data. All of which are in short supply. How do you recommend we get started with AB testing given the resource constraints?”
Mike: I think the resource constraints that you mentioned are probably the place to start because you’ve talked about how there’s a couple of different places where you have these resource constraints. There’s time, there’s money, and then there’s the low numbers of users. I think the low number of users is the thing to really focus on just because it’s really difficult to do AB testing if you don’t have a large number of people that you can put through a particular part of your sales funnel and get the results that you need in a short enough time span.
If you’re running an AB test and it takes you 12 months to get a result, there are two problems to that. The first one is that it takes you 12 months to iterate and do any sort of testing to move you to the next level. The second part of that is that because it’s such a large time span, those results are probably not really statistically relevant anyway.
Even if you go through those calculations and you think to yourself, “Oh, well yeah, this is statistically relevant.” It’s probably not just because of the seasonality of that stuff. It may be statistical over the course of another year but it’s not helpful. That’s the root problem. It’s just not helpful for your business to figure out really what’s going on. I would not really look at AB testing at all.
I would probably look at other areas of your business and try and find places where you can really drive the business forward whether that’s content marketing or advertising. You could try various different advertising channels. You could try face to face meetings.
For this particular industry, it seems to me like it’s very much relationship driven and yes, there are certain lists and stuff that you can get on but having relationships with people who can recommend your services, that’s really what tends to drive business in a larger enterprise environment which is kind of what the Vendor Registry falls under.
Rob: I’m not sure how much I have to add to that other than it doesn’t sound like split testing is the way to go for you. You just need a lot of traffic to do it and it does take a lot of time. It’s easier to split test things like headlines, pricing page. I would not build out two versions of anything.
I think this is much more about talking to customers, potential customers and getting a small sample size but getting real feedback, whether that’s in person at conferences, or trade shows, or Skype calls, or emails, or whatever it takes. That’s going to be a faster and more effective way to try to figure out what to build next.
This is the conundrum of being a good product person. It’s figuring out what to build next. I think there’s a big element that your vision of what it should do is a big part of gut feeling based on your experience in the space. You take a method of landscape. Part of that in my opinion should not be the over riding part is talking to customers and getting ideas and getting a sense of where the market wants you to head.
I don’t think split testing is the way to go. You think about how we decide on what’s the next feature to build in Drip. We don’t build two different features and split test them. We make the decision. It’s based on a bunch of factors that we combine and have honed over the past couple of years. Thanks for the question. I hope that was helpful.
Our next question is from a listener who asked to remain anonymous. He says he’s been following the podcast for a few years, can’t get enough of it. He’s a self funded a B2B SaaS startup for about two years. He says, “I have dozens of potential customer interviews and have been quite involved in helping beta users and testing the product myself. It touches on a sensitive business process that impacts other processes so potential customers are on a certain level of configuration and they are very afraid of bugs. I’ve had a few bad experiences with some beta users who keep asking for improvements and never sign up for the product. To be fair, the app has had some bugs here and there as we were in a hurry to push new features. We may have gone too far in the opposite direction asking customers to sign up first a statement of work contract before doing any implementation. It is really slowing the intake of new customers even if they are enthusiastic after we show them the demo. Now that we can slow down on new features, I’m hesitating on the priority to pursue. I have a number of things we’re looking at. Do you think we should remove any barriers from the sales process for the time being, focus on removing all bugs, and send the message that the app will have to be used mostly as is or do you think we should make Screencasts, write tutorials, etc. to let users start on their own? I’m hesitant to do this because based on their objectives and on their existing processes, they will have to use the app in different ways. For what it’s worth, the cheapest pricing tier is $300 a month and the medium tier is $900 a month.” What do you think, Mike?
Frankly, I don’t think we need to stay within this. He said should I do this or that? I’m not sure that either of those is the right choice. I don’t think we need to stay within the boundaries he’s laid out.
Mike: I think this is an interesting question. The problem here is I think that you’re unsure of how to proceed and it partly depends on where your revenue is and I think at those price points, you’re probably at a point where if you’ve been working on it for a couple of years, my guess is that it’s probably profitable.
I think that given that, you probably want to put yourself in a position where the app is making enough money that you can pour additional money from the business back into it and reinvest those profits to build not just the business but also go back and address some of the quality issues or the bugs and stuff that are in there. That’s just going to take more resources, more engineering time, and to get that stuff, you need money. I would probably focus on anything that is going to be bringing in revenue.
It doesn’t seem to me like that’s doing screencast and tutorials. Those are things that are helpful for users but they’re not necessary to get somebody in the door as a paying customer. You can deal with a lot of issues like that that come up on an ad hoc basis or during on boarding sessions. There are ways to get around that without actually having to do the work.
Basically, do whatever that needs to be done in order to drive those sales through, if people need personal demos or hand holding during a personal walkthrough or something like that. You can use those as well. The price points, my guess is you’re probably talking to people directly for most of your sales especially if you’re going to do any sort of annual contract or anything like that. Those are the places where I would focus and then once you have that money coming in the door, then turn around and start deciding where that money should be allocated to help build the product in the right direction.
For people who are coming in, I think the interesting piece about that was that flip flopping back and forth between, “Oh, there’s some bugs. We should get them taken care of.” Versus going to the other extreme because people aren’t actually signing up for it after you go in and address the issues that they brought up. What I’ve been doing is telling people, “Look, if you sign up, then I will look at that as kind of a higher priority.”
I typically track feature request during a demo and I’ll write down some of these name or tag it on a bug in an open case inside my bug tracker and put the person’s name on it. But if they don’t sign up, automatically, it becomes a lower priority to me because it’s not a paying customer. They didn’t sign up for it. But if I get enough of those onto a particular case, then I can probably justify spending time and effort because then it looks to me like it’s impacting sales.
It doesn’t sound like you are tracking any of that information right now. You’re really just micro focused at the individual person who you’re looking to onboard. I’ll back off from that a little bit and try take more of a macro view to it and say is this a big enough problem that we should deal with it or is this something that we can just log and come back to in the future?
Rob: My sense is it sounds like you have a couple of issues. If you have bugs in the app right now, that’s the first thing you need to take care of. I would put the brakes on everything and fix those because if you get a reputation in this space, and it sounds like it might even be a small space where people know each other and are talking, if you get the reputation of being buggy, that doesn’t go away. It’s like your credit score. Once you jack that score, it is really, really hard, if not impossible to get that back. That would be the first priority of all this stuff that I would basically buckle down.
It’s kind of like having performance problems. It’s like we halt almost all feature development if we find that we’re running into performance problem because you just can’t let that stuff go. It’s only gonna get worse and it’s going to tarnish your reputation. As that’s in process, it sounds like you had folks who ask for improvements and never sign up. By improvements, if you mean bug fixes, then that’s fine. I would do that.
But if they’re asking for more features, something that I would do in the early days of Drip, is if someone asks for a feature, I would say, “Is this the one thing that you need us to implement to be able to use Drip?” If they said, “Yes.” Then I said, “Great. Sign up for a trial and we will have this implemented by the time your trial expires. If we don’t, I will comp your account until this feature is built.” We don’t do that anymore. Tens of thousands of users, you can’t. But in the early days, when we were scrappy, that’s the kind of stuff I was doing to try to get.
If someone had a list of 10,000 or 15,000 people, it’s going to pay us a couple of hundred bucks a month. That was a big deal and it sounds like for you, it’s totally worth doing. It’s interesting. I don’t know about a statement of work contract or any of that stuff. That to me, feel a little cumbersome and a lot of overhead but just having them sign up, put a credit card on file, is a step and you’ll find that some people will balk and they don’t sign up and that’s fine. That’s fine. They were never going to sign up. The ones who do are committed to it and then you implement their features. I just found that that’s a good way to do it.
Given your price point, personally, unless you have a lot of inbound interest, I would personally be hand holding and doing very much one on one sales. The fact that between $300 and $900, I’m assuming you have a higher end tier, your monthly average revenue per user is going to be let’s just say $400 or $500, $600 range. That’s a nice chunk of change. That is definitely worth your time or someone you hire’s time to handle, focus and get them started.
I would not tend to go towards the self on boarding at this point just because of the price point and the value. I think that the value the customers bring to your business is worth the time to spend especially in these early days, to do the learning and to handle everybody into the app. I hope that helps.
Our next question is actually not a question. It’s a compliment for us and the podcast. It’s from Alex Summerfield. He says, “I’ve been listening to your podcasts for about three years. I remember when I first listened to the episodes, just thinking about it, part of your intro really fit for me. I tried a couple of ideas but they never took off. After switching a couple of jobs and getting too busy to work on side projects, I finally got sick of my job and started consulting and working on a startup on the side. I listened to your latest episode and heard that just thinking about it part, and it finally hit me that I’m no longer just thinking about it, I’m actually doing it. I just want to say thank you for the impact you’ve had on my life. All the advices helped and I really enjoy hearing the updates on your businesses.”
Mike: Thanks for the compliment, Alex. I do think that it’s really hard to get started and I think a lot of it has to do with barriers that we encounter as we’re going up in the social environments that we either come out of or immerse in on a daily basis. Breaking away from the things that the people around you are doing is just really challenging, to be honest.
If you don’t interact with the people who are starting their own businesses, or entrepreneurs, or even doing software on their own, it could be very difficult to break the mould and people look at you funny and say what is it that you’re doing because you’re the oddball at that point. You’re weird. It’s nice to hear from someone like you who’s gone out there and actually started working on side products with the intent to move forward and start your own thing.
Rob: A couple more questions. Our next one is from Rob. He says, “I’m part of an early stage bootstraps startups company in the UK with two other co founders. We are between three to six months from launching a product and having any revenue. One of my co founders is pushing for job titles/corporate roles to be assigned like CEO, CTO, etc. Is it important to allocate corporate titles/roles? Is it best to get this sorted early in the life of a company or is it just a distraction?”
Mike, as you think through this, I think corporate titles versus corporate roles is two totally different questions so maybe we can tackle each of those individually.
Mike: I was going to mention that because when you’re doing customer development, it seems to me like CEO and CTO, when you’re talking to a prospective customer, you may think that that sounds impressive but for the most part, especially if you’re early on, you don’t even have a product yet, those titles, I feel like they detract from whatever it is that you’re trying to do because they say, “Oh, you’re the CEO of this company that really has nothing.” And you’re asking people for help. Versus if you are the CEO of a company that has a full blown product and it’s been in the market for three or four years, that has weight behind it.
That early on, I would just say founder or co founder. I wouldn’t even worry about those corporate titles when you’re talking to customers or prospective customers. They’re basically meaningless at that point. In terms of roles though, that’s what people tend to think about when they think of titles like, “Oh, the CEO does this. The CTO does this.” Really, internally, that’s where that matters but externally, it doesn’t.
You want to have a clear expectation of each other and what it is that you’re expected to do inside of the business. And then externally to your clients and customers, I would just say you’re a founder or co founder. I wouldn’t go into what it is your actual title is because it really doesn’t matter. But internally, you do need to be clear on what is your responsibility versus what your co founder’s responsibility is so that each of you know what they’re supposed to working on and when they should be getting guidance and input from the other person into the things that they’re doing.
Rob: I don’t have much to add to that. I think that’s a very good summation of it. There are certain things that are distractions. I found that using the phrase co founder is really helpful especially in the early days when folks know that you’re still being scrappy and doing customer development.
Last question for the day is about sending promotional emails to existing customers. It comes from Bruce. He says, “Thanks for the great show. I have a simple software product I’ve been selling online for several years. My customers all need to provide their email addresses so I can send their payment confirmation and so I can authenticate them when they log in to use my product. I don’t state on my signup page anything about what types of communications the new customer should expect to receive from me when they provide their email. I’m releasing some improvements and new features. Some of these improvements will benefit existing customer with no additional payment. Some new features I intend to sell to existing customers as add ons. Is it okay to email my customers to tell them about the new features? They haven’t given explicit consent to receive email from me. I noticed that whenever I send a SaaS part because I’ve received a lot of emails providers even though I don’t recall opting in to any mailing list. If you guys think it’s ethical, legal, or wise to send emails to my existing customers, would you recommend I add an opt in checkbox or some small print stating the customer is going to expect to receive occasional information/promotional emails and only send only send emails to customers who opt in or have had the chance to read the small print? Thanks in advance for your advice on this. This app is called countingdownto.com.”
I like the way he phrases it. There are legal implications and then there’s ethical. That seems a little strong but your own moral compass is how it feels. What are your thoughts on this, Mike?
Mike: I think we have to provide the standard podcast disclaimer that we’re not lawyers and you can’t rely on us for legal advice, especially given that this business is based in Canada so laws there are different than they are here in the US. Given that, my thoughts on this are that if somebody is signing up for your SaaS product, there are a couple of different types of emails that you could send to them.
When they purchase it and then you send them a receipt, that’s what’s considered to be a transactional email. They purchase something from you, you send them a receipt. That’s completely legit. You are almost expected to send that email and that does not fall under any sort of spam laws that I’m aware of. When you get past that and you start talking about newsletters, and product updates, and things like that, that’s where it gets into the gray area which I think that you’re a little concerned about.
If you’re running a SaaS, it seems to me like you almost have to have people on a newsletter of some kind or a product updates email list of some kind. That said, I would default to adding them to it but I would explicitly give them the ability to opt out at any time. Even if they are an ongoing customer, you might want to segment that list a little bit to give them a profile page that says only email me about product updates and include me in my newsletters. Two different options and then you segment your list based on those two things.
That way, if somebody wants completely out, and they only want the receipts from you, you can still send those email receipts to them. But if they also want to receive your newsletter and the product updates, you’re still going to be sending those to them. Again, just segmenting between those two types of people or if there are other segments that you want to include in that, I would do that but I would opt them in by default and them let them choose otherwise if they want to. That’s probably the way that I would approach it for that.
But again, there are obviously legal implications as well. As to what Rob said about the moral implications of it regarding your moral compass, if you sign up for a SaaS, you expect to get email and told like, “Hey, this is how this product can provide additional value.” I think what you’re probably seeing is when you sign up for new products, people are sending you a lot of onboarding emails. I think that those fall into that grey fuzzy area where a SaaS vendor could easily overwhelm you with a lot of email to the point that you start to consider it spam more than anything else, especially if you decided to not use the product.
There is a difference between those emails that are being sent as onboarding emails where you don’t have the opportunity to opt out because some vendors will send those and you can’t opt out. That’s part of their on boarding process. Depending on whether you allow them to opt out or not, that factors into it.
Rob: Yeah. In the US, CAN-SPAM says if you have a commerce relationship or customer relationship with someone that you can send emails to them related to the business transaction and I think otherwise, there’s always this grey area. It’s like if you read the verbiage exactly, you could interpret it one way or the other. But in general, you do see SaaS apps. If you sign up, they don’t explicitly make you opt in and they send email and people are not being investigated by FTC or FCC or whoever would investigate that. I think the precedent is that this is generally considered a legal thing.
Like Mike said, your moral compass is going to vary. There are people who will say, “Oh, I should explicitly opt in for every single email you’re going to send me.” People get so far into the protection of your email address and your inbox and that no one should ever email you and then on the other end of the spectrum, there are spammers. You gotta ask yourself what’s it worth. There’s some business value to you.
People genuinely do generally really want to hear about feature updates, specifically feature updates to the app. Absolutely! Who doesn’t want to hear that? It’s pretty rare that people unsubscribe. Like Mike said, you should give them the opportunity to do that. Even if you’re sending things that are up sells, my guess is that’s going to be pretty valuable information for people because if it’s an up sell, it’s likely going to have some value that a good chunk of your list is going to at least be interested in and interested in hearing about.
Everything you’ve mentioned in terms of content, it’s not like suddenly you’re taking customers and just starting sending random blog posts with some content. These are really applicable to what they’ve signed up for and what they’re paying you money for. I don’t personally have any kind of issue with you doing that. It sounds like you’re not going to be overly promotional based on how careful you’re thinking about this, which some people don’t do.
Anyways, that’s my take on it as well. It sounds like Mike and I are pretty much in line on this. I think that’s the general consensus of the industry and where it’s at today.
Mike: Yeah. Coincidentally, it’s the first that we’re recording on and I’m getting ready to send out an email to the people who are current subscribers for Bluetick to tell them like, “Here’s the list of all the different updates that have been added over the past four to six weeks that you might be interested in hearing about or maybe you didn’t know about this feature or this was something that was requested by a couple of people.” Just to let them know because there’s a difference between features that a specific person requested and you can let them know when those things go in but you still have to let the rest of the customers know that that new feature has been added. Otherwise, they won’t know anything about it.
I’ve seen a couple of support requests come in and say, “Hey, is it possible for us to be able to do this?” I’m like, “Yup. I actually just added it a week ago and I haven’t gotten around sending out basically the product updates over the past month.” I do think that it’s a good practice to get into. Just be sending those out especially if you’re running a SaaS where it’s regularly changing and the expectations of the customers are that over time, that SaaS app is going to get better.
That matters a lot more I think in the early stages than when you’ve got a late stage SaaS where it’s like you’re not really adding a lot of features. You’re adding scalability and things like that. But if you’re adding features at a very fast pace, it’s probably best to email them on a monthly basis and say, “Hey, here’s all the new things that are going in that you’re getting essentially for free just for being a paying customer.
With that, I think that wraps us up for the day. If you have a question for us, feel free to call it into our voicemail number at 1-888-801-9690 or you can 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 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 342 | SaaS Development Shortcuts
Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike talk about SaaS development shortcuts. They discuss the gap between what you think needs to be done versus what really needs to be done and give you tips on how to move faster.
Items mentioned in this episode:
Transcript
Mike: In this episode of Startups For the Rest of Us, Rob and I are going to be talking about SaaS Development Shortcuts. This is Startups For the Rest of Us episode 342.
Welcome to Startups For the Rest of Us, the podcast that helps developers, designers, and entrepreneurs be awesome at building, launching, and growing software products, whether you built you first product or you’re just thinking about it. I’m Mike.
Rob: And I’m Rob.
Mike: We’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s going on this week, Rob?
Rob: It’s been a good week and it’s memorial day weekend coming up so we are flying to California for a couple of days, just like a three or four day trip to see some folks, just looking forward to it. We haven’t been on a trip for I guess since MicroConf which is maybe six weeks ago, it’s not that long ago but looking forward to getting some sun and it’s also nice and warm up where we’re going. Kind of just easing into it. How about you?
Mike: I have to go see a specialist and have some x-rays taken because I might have a torn rotator cuff.
Rob: That is such a bummer, man.
Mike: I know. It’s not bad. If it’s a tear, it’s really small. I think it’s not bad enough where they look at it and say, “Yes, this is obviously a tear. It might just be inflamed and some other stuff.” They’re going to start with some x-rays and see if there’s any fluid buildup or some bone spurs or something like that. If that comes back kind of inconclusive then they’ll move on and do a whole shoulder MRI and see what comes out of that.
Rob: Yeah, that’s a bummer. If they find it then they have to do surgery and then you’re not able to type with that arm for a while.
Mike: Yeah. They also said that because I still have good range of motion, it just hurts when I move in certain positions that physical therapy might be something that they could work with, anti inflammatories or various other things but I’m hoping that I can dodge that surgery bullet. To be honest, that’s not something I want to go through.
Rob: Yeah, totally. It’s always a bummer to get hurt. Nowadays, when I get injured, it’s not like we’re that old but it’s like I remember getting injured running track when I was 21 and you just heal quick, your body is in really good shape and you’re younger. These types of things now, it’s going to take you awhile to get over that. You’ve also had back issues. You just don’t heal as well as you did 20 years ago or whatever.
Mike: Yeah. That actually came to mind like, “I’m not as young as I used to be. I just don’t heal as quickly.” Back then, in your 20s, you can take the bumps and bruises and shake them off and you’ll be back at it the next day. This is just like that dull ache and I’m like, “Oh, this is just going to go on and on.”
Rob: Yeah, totally. Cool, what else? What are we talking about this week?
Mike: Today we’re going to be talking about SaaS Development Shortcuts. I pulled some of this from my MicroConf talk. The basic idea is that there were some parts of my talk where I highlighted where there are gaps between what we think needs to be done versus what really needs to be done. In these places, there are some shortcuts that you can take to avoid doing work now that you can presumably do later. Some of it, you can just avoid indefinitely but there’s other pieces of it that you can push off to the future because it’s going to either take a lot of work or there’s going to be a long time for you to see any results or benefits from doing that work.
There’s workarounds that you can put in place to avoid doing it now. In some cases, you’ll take on some technical data or some other types of work data that you just have to defer really. But by doing so, it allows you to concentrate on the more important things now versus delaying your launch or delaying getting sales or just delaying moving your product further than it would if you took the month or three months or whatever to implement the things that you were looking at.
Rob: Yeah. There’s a lot of these tradeoffs that go into building any type of software, that go into building any type of business. A lot of things that you have to think about and think to yourself, do we have to do this now? Can we push it off? If we push it off, does it create more of a hassle later on? Does it create more debt later on? Not monetary debt, obviously, but technical or business debt. Or is it the same amount? Is it the same amount in three months if I build the knowledge base today, if I build the knowledge base in six months, is it the same amount of work versus when you’re in code, if you take a shortcut, we all know that technical debt will actually get worse over time. There are some of these that get worse if you don’t do them and some are the same or maybe it’s a linear progression. These are the kinds of things you have to think about as you’re trying to figure out what you can delay.
Mike: What we’re going to do is we’re going to walk around some of the different things that we might think that we need but could be delayed with various workarounds and we’ll talk about what some of those workarounds entail and then we’ll talk about some of the things that are really difficult to find workarounds for. And then we’re going to dive into some general guidelines for deciding how to push things off and whether or not you should do them now or schedule them in the near future, kind of how to prioritize them.
To kick things off with the things that we might think that we need, the first one is a sales website. It’s interesting that I ran into this where my traditional thinking all along has been, “You need a sales website in order to sell your products, to tell people what it is, what it does, how it works, how they would use it, what the value is.” What I realized is that if you’re doing direct sales with people, you don’t have to do any of that. You can get away with a lot less than you need to.
For example, I’ve got Bluetick up over 20 customers, around 20 to 25 right now. I still only have I think 3 pages on my website. One of them is a privacy policy, another one is a terms of service and the third one is just the landing page where basically it gives you an overview of what it does and asks you for an email address either to signup, to get an invitation code or to join the mailing list and go through a five part email course. That’s it. I’ve got to this point really without having a website.
Rob: This is an easy one when you’re doing direct sales. With Drip, I wasn’t even doing direct sales but it was onboarding, it’s really what I think about it as. It’s like people wanted to try, always doing emails back and forth and all we had was still that landing page from months and months of onboarding and we did the same thing, got into the high teens, low 20s in terms of customers that way.
Given that you’re still probably trying to find a product market fit at this point, it almost doesn’t makes sense to build a website because you don’t really know what your positioning is, you don’t know what your feature set is, this is still early customer development. I think there are a lot better places your time can be spent than going and trying to hack together some entire website.
Mike: The interesting part about all the stuff that you just said is that because you don’t know what to put on the website, most of it is probably going to be wrong anyway. Going that direct sales route allows you to have the conversations and get people’s feedback and understand truly what it is that they are trying to solve for and what the terminology is that they use and what resonates with them.
Once you’ve done that enough, you get to a certain point where then it makes more sense to build the sales website because you have enough information from those conversations to be able to build something that is going to be effective and pitching towards people that don’t know who you are and you haven’t had a referral or had no conversations or had nothing explained to them, that’s really the position that it puts you in. That really leads into the second one which is marketing automation.
I think people look at marketing automation as a panacea for all types of sales problems but the reality is that it’s very difficult to automate a sales process when you don’t even know what it is that people think yet or what they’re really looking for and that’s what that direct sales approach is going to solve for you.
Rob: Yeah, I agree there too. As much of a proponent as I am of email marketing and marketing automation in general, which is more advanced form of email marketing, it’s just too early at this point. Until you hit the point where you really do feel like you have a good idea of your positioning, you’re going to start to feel like you know what content people need in order to understand your product. There are questions about how you use the product but there’s also questions about the higher level architecture like, “What are best practices for sales nurturing?” That’s what you’re going to get, Mike.
We kept getting what are best practices for email automation or marketing automation? How do I structure my tags? What should I use custom fields for? How is this different than email marketing? It’s a higher level stuff, that’s the kind of stuff that you’re going to either be sending to people via email or you’re going to start pushing some blog post out at some point. That’s at the point where I think you should tip into now I’m going to actually add lead nurturing stuff and build some workflows and start doing behavior tagging because at that point you just have such a better idea of where your business is.
It’s almost a waste of time if you only have 100 website visitors or you only have 20 customers. You really need to get to the point where you’re getting 500 or 1000 uniques a month to where you’re getting at least a handful of new subscribers to go through that stuff.
Mike: The caveat here is that marketing automation is a very broad term and it doesn’t mean that there aren’t certain tactics that you can pull out of the marketing automation playbook that would be beneficial for you. For example, I just saw that Drip sent out an email with a pointer to a mechanism used by Christoph Englehardt who’s a good friend of the show, comes to MicroConf Europe, has taken notes for MicroConf Europe as well. In that article, he went over the idea of using Drip to send an email to people after you’ve captured their email address to pull them back and help with abandoned shopping cart emails. That’s a tactic that you can use to help pull people back to your website.
I actually use it for Bluetick right now where if somebody goes in, they request an invitation code that pops them over to a survey page. If they don’t fill out the survey page, it sends them an email from Drip about 10 minutes later. My hope and intent is that they will fill out the survey because they’re right there. But if they don’t, then they get a follow up email from Drip a little while later. Interestingly enough, I got an email earlier this week from somebody saying, “Hey, how did you do that? Because I’d love to know a little bit more information about it.” We actually have a demo scheduled here pretty soon. It’s tactics like that that can really help. You don’t have to go out and implement everything that’s marketing automation related but there are certain tactics that you can pull from it.
Rob: Another thing that I tend to push off, because it doesn’t get harder to do this in three or six months, it doesn’t build debt, is documentation. At first, when you’re doing hand onboarding, you’re doing direct sales, really the documentation that I had was the emails back and forth with people. I just started gathering those up. First it was an FAQ doc and then I realized some of them needed to really be flashed out. That was the best way to kick off our knowledge base.
First there was nothing. As soon as we get to the point where I knew we’re going to be emailing several thousand people on our launch list, I knew we needed something. What I did is knowing that writing documentation was going to take forever, I went in and I recorded about maybe somewhere between eight and a dozen Screencasts. Three to five minute Screencast where I walk through. This is what a campaign is. This is just basic stuff. This is what this setting does, there wasn’t a ton in the app.
I just slapped up again, that was 8 to 12KB articles. It was in a WordPress, there’s a WordPress theme, I think, that allows you to make a KB and I just put up there and that’s it. We had 8, 9, 10 KB articles at the start. Screencast or not, the ideal way to consume that, it was very fast for me to make them but within the first few months people are saying, “I really want to be able to read through them. I was at the airport, the WiFi was bad and I couldn’t play them.” Overtime, I actually paid someone to turn those Screencast into documents, like actual KB articles.
That’s the progression. You don’t need to write all the documentation upfront. It would be great if you could but you just don’t have the time. That’s the idea, you start with nothing and it really is just manual and you’re going to have more support upfront because of that but then you move into something lighter, for me that was Screencast, for you it may be something different and then ultimately you build that out over time.
Mike: The next item on the list for something you can push off until later is a billing system. It sounds like a billing system is probably not something you want to push off because you want to be able to start getting revenue as quickly as possible. There are hacks around having a billing system in place. Instead of having an automated billing process in place, you could send people manual invoices. There’s tons of different pieces of software out there that allow you to send somebody an invoice and then have them pay you, you could easily do something like that through PayPal, you could send them a PayPal invoice once a month.
Yes, that doesn’t scale but that’s not the point. The point is to allow you to avoid building out that billing system until you get to a point where it is difficult for you to keep up. Another thing that you could do is you could manually enter people’s credit cards in Stripe using the backend. There’s a WordPress plugin called WP Simple Pay which is from Phil Derksen who’s also a MicroConf attendee and friend of ours. That WordPress plugin can be used to capture those credit cards and help you with that stuff without you being involved directly and taking the credit card and entering it in.
If you want to automate some things a little bit, as Rob said, there’s that natural progression. Over time, you can add more and more things into it until you get to a point where it is fully automated and it helps you move things forward. But until you need it, there’s no point spending a lot of time doing it because a billing system can be very, very complicated. At the start, you don’t need all that complexity.
Rob: With Drip, we didn’t actually use any of those approaches, we just had a little Rail script that Derick cranked up. I think it took him less than a day. We wind up building that five days before the first billing was going to run, we were signing people up and I think we got 30-day trial so we got 25 days into the trial and I’m like, “Alright Derek, we got to get something that’s going to bill people on a couple days.” It was super simple at first, it was literally this is an amount and this is how much you’re getting billed.
Again, over the coming month, you have to upgrade and automatic downgrade and prorating and whatever else goes along with it. We built that into it but we started pretty simple. I agree, you don’t need as much logic as you think you do in the early days in billing.
Mike: One of the more common things that you probably need to implement in a SaaS application is permission system. Depending on whether you’re going to do it like a single tenant or multi tenant model on the backend, you may need to implement permissions inside the system to allow certain people access some resources and then prevent others from accessing those same resources.
This can get very, very complicated, especially if you get into the idea of having group accounts and some people with certain roles or permissions. Again, there are lots of white papers and documentations you can read out there about different ways of implementing the permission systems or claim system and it does get complicated. But in the early days, you really don’t need any of that. All you need is the ability for somebody to login and see their data and not see somebody else’s. You don’t need to create all this additional complexity with groups and roles and permissions and stuff like that, you could really get started with one user.
To Rob’s point earlier, there are certain types of debt that you’re taking on. In this case, it’s a technical debt and that can be difficult to get around. But in the early days, if you need to get around that just to help prove out the idea and make sure that things are working and people are getting value out of the app, this is one of the shortcuts that you can take. You have to be forewarned that it is technical debts you’re taking on when you use this approach but it could be what you need to do.
Rob: Yup. When we first launched Drip, it was just one login and then people wanted to invite whatever teammates and so then we had to add the ability to have additional folks. The only thing we had was owner and I think we called it an admin or something was the other role. 6, 12 months down the line, we kept getting requests for like, “I don’t want some people to mess with our settings.” We added a member, there is three tiers, owner, admin, member.
We have been able to maintain that. We are tens of thousands of users and four years into a pretty substantial SaaS app. We do get periodic requests to add more granular stuff and we started talking about that internally, what that would look like. But the good thing is now, we really understand our customer, we really understand our audience and we have had enough request for it asking in different ways. I want people to be able to come in but not export anybody or not be able to view my subscribers or not be able to send anybody. There’s all these different things.
We’re not making it up in a vacuum, it’s not like we just dream up how we think that they might use it, we have real usage patterns and real feature requests. I’m very much in agreement with you on this one. If you need multiple logins, that’s fine but as soon as you get to anything granular at all, I would pump that so far down the line unless that’s a core, core competency of your app which I’m guessing it’s not going to be.
Mike: One thing that I recently did was I repurposed our impersonation mechanism and applied it to people’s accounts to let them have multiple users inside the same account. It works fine. It’s not great, there’s certainly a lot of work that needs to be done there but for the time being it allows people to use the products and have different logins physically associated with the same account. Like I said, it’s a tradeoff but it does work. Early on, your customers are probably going to be pretty understanding about that stuff.
Rob: Another one is password reset and account management type stuff, it’s a lot of time to implement versus the actual number of minutes anyone is going to use it or the number of times someone is going to use it in the first three months of your app. I know that pretty sure we had a reset password button and I think it may have fired off an email to us or something that’s like, “Reset my password.”
Again, this is very, very early on, you’re at 20, 30, 40 customers, you’re going to get one a week and you can just do it manually and people understand. It’s not until you go a little broader and again you’re going to have to really start to scale up that you need to build this out.
Mike: Funny enough that I had mentioned this is my MicroConf talk as well but the password reset in Bluetick did not work at all for nine months. We implemented it probably six months ago but it did not work for the longest time and we would just go in and manually do if somebody came back and said, “Hey, my password reset didn’t work.” There was literally only three people who would ask in those nine months. It’s one of those really low frequency things that is important and needs to be taken care of but you can manually handle it if need be. I did have a manual backend where I could go in and I could reset somebody’s password, they just couldn’t do it themselves.
The next one is a big thing which is reporting. I think in most cases, the challenge with reporting is that unless your app is specifically designed to provide reporting services for somebody, then you can probably get away with very little reporting in the first version. Most of the reason that you would want to pump this down the road is because you don’t necessarily know what people want to be reporting on. As you have conversations with people, you’re going to learn more about it. When you are initially looking at building reports, you’re guessing what people want and it’s just not going to be helpful to you because you’re going to build a bunch of things, people are going to say, “Hey, could you do this instead?”
Now you’ve built a bunch of things that essentially you have to support longer term because you’ve already built them and put them in the app and people are expecting that those things are probably going to stick around but now you’ve got all this legacy code there and it wasn’t really what people were looking for anyway. I think that in most cases it’s best to just put this down the road and not bother with the initially. [00:19:13] had done a recent episode in the Startup chat where they talked about killing features. You can kill features like this but if you only have two reports, it’s really hard to take away one of them.
Rob: Another thing you can push off to get further down the road is the classic marketing strategies, the ones that require long iteration cycles, higher workloads like SEO and content marketing. These are things that take a long time to ramp up to, it’s not something you should push off so long because it’s not like you’re going to launch a blog and then start getting traction with either content marketing or SEO immediately.
Again, when you are under that 50 person mark, it’s just not something that you want to scale to. If you are not doing these other things of building a password reset and building a billing system, you’re not there yet, you don’t actually want to drive this type of cold traffic to your site and stuff. Everyone talks about it, they talk about this, they talk about split testing, these are things that you need to do later on, you need to wait until you’re starting to scale up marketing and you feel like the app and your team is at a place where it can really onboard people, you have documentation and you’re ready to start dealing with really new users to see how they come in and how they get onboarded and how they convert.
Mike: The next one is new feature development. The rule of thumb that I’ve taken lately is that unless I get a certain number of people asking for something or saying that that’s important, or if they’re not a customer yet and they say that, “I need this in order to be able to sign on.” It’s a deal breaker to them, I generally push that off to the side in favor of other things that more people have asked for or are higher priority because it’s not something that is being asked for a lot, therefore, it’s just less important than those other things. I’m not going to spend my time building something that very few people are going to use or it’s not going to be used very often. Instead, I’ll spend my time working on those things that people are going to use a lot, that are getting asked for a lot because those are clearly most important.
The other ones are stuff that they’re nice to have sometimes, it’s just people are asking a question because they want to know the answer to it, not because they’re actually interested in using it. That’s an interesting side note that I’ve discovered is when somebody asked you something, a great way to deflect the question is to ask him if it’s important to them. Sometimes they’ll just say, “No I was just asking, I was just wondering.” If you have that developer mindset where how do I solve problem X that somebody just presented me? You can very easily find yourself going off into the weeds and trying to do something that’s going to take you a while to do when the person was just asking, they just wanted to know because they were curious, not because they needed it.
The last one is being able to provide real time results for people. This delves partially into reporting but also if you need to do any sort of complex calculations or you’re not sure how you’re going to get the data from one place to another and it needs to be done manually for the time being until you go to a point where you automate it.
This could be any sort of situation like if you have to deal with a government website, for example, and you have to feed data into it, those are notoriously terrible when it comes to APIs and being able to send data into them. A lot of times you have to resort to various hacks like using Selenium to automate a browser, to go plugin all the different fields and stuff. Instead of doing that, hire somebody to go in and type in stuff that customers have entered, you’ve made it easy for them to either import the data or put stuff in in a way that makes sense and then you have somebody that go in and type it all in.
Most people would say, “This is a SaaS application and that should be real time.” But it doesn’t need to be, most of the time when you’re looking at those types of things, there’s customer expectations about how long it should take and then there’s also what they really needed return to them. If the time period is a 24 or 48 hour window, it’s probably not that big of a deal. Unless your whole value proposition is that it is automated and very fast, in those types of cases you probably have to do all the leg work and automation upfront. But a lot of times you can get away with just pushing it down the road. Once it gets to a scale where you can’t handle it or it is causing you far too much to not have it automated, that’s when you go down that path.
Rob: Let’s take a look at three things that are difficult to get around, things that you’re going to have to implement upfront and the things that you should be focusing on. The first one are the core parts of your value proposition. Things like features, reports, if they’re absolutely needed, automation, if that’s really what your app does. Without this, you don’t really have much value. This is probably the core piece of finding product market fit and building something people want, you should be focusing on the features that are driving value for your prospects and customers.
Mike: The next one is probably a judgment call but I find that user impersonation is really difficult to get around. You can use screen sharing, so if somebody runs into a problem, you can get on a call with them using a variety of different tools and share their screen and look at what it is that they’re seeing. That type of thing is impossible to do without the other person being present and allowing you to essentially watch them as they login and go do whatever it is.
It’s a lot easier in many cases to have an impersonation mechanism in place so that you can flip a flag on your account or in the database directly and just say, “Hey, log me in as that person.” Then you will be able to see exactly what they would see. If they come back and they have questions about how do I do this or how do I that or why is this showing up in my account this way, it allows you to go into their account, take screenshots and then send them those screenshots or do a Screencast and explain to them what it is that they’re seeing. If you’re seeing data that shouldn’t be there, then it’s a lot easier to do it without the customer present and having you say why is this there? I don’t understand myself, we wrote it. You’re in a much better position if you have that impersonation ability.
Rob: By impersonation you mean like being able to login as one of your customers, is that right?
Mike: Yes.
Rob: I totally agree, this is a huge one. We call it ghosting, you ghost in as them. But it’s incredible to be able to see the app as your customers see exactly what they need. If you don’t have that ability, it’s like you’re digging through raw data that’ll send you a bug and you can’t reproduce it but as soon as you can login as them, that’s a big deal. This is something I would build very, very early on.
The third one that’s difficult to get around is not having any type of sales channel. You need to be able to get to customers somehow. Referrals can be one, this direct sales model, you could be doing outbound cold outreach, you could just have an email list of 50 people and you email them one at a time and you’re bringing them in. You need some type of sales channel to be bringing people in for this to be worth it. Until you get the feedback, you can get a little bit of revenue and you can start building something that you hope a broader audience wants.
Mike: Actually, emailing them individually, that’s what Bluetick does. It allows you to iterate through those people and email them individually as if it was coming directly from you and you can very quickly go through large numbers of people, personalized automation at scale. But I agree. It’s difficult if you don’t have a sales channel at all, you can’t do that with five people.
Rob: That’s Bluetick.io ladies and gentlemen.
Mike: Now we’re going to move on to general guidelines for deciding what to push off. There are a couple of different criteria you can look at. The first one is is there a manual workaround of some kind? It doesn’t need to be something that is quick and easy or automated. If it takes writing sequel and running against the database manually for an individual customer to do those types of things, then it counts as a manual workaround. It doesn’t mean that it’s easy but if it’s easier to do that than it is to spend a week or two writing code, then chances are good that you can start with that and not have to go through that couple of weeks of writing code that may not be used very often.
That leads directly into the second thing which is it’s not something that you or a customer would do very often. If it’s not used very much, then there’s no real point in automating it and writing the code to do those operations.
Rob: Another guideline for thinking about when to push stuff off is if it’s going to take a long time to automate. There are even things that happen fairly frequently that if it’s like two or three months of dev time to implement, you might still be doing manually or having someone on your team do manually a year, two, three years into your business. It’s always a balance. If you can build two killer features in two months or you can build this one background task that only happens once a week or once a day or five times a day, there really is a balance to human automation versus code automation.
Another guideline that leads right into is you’re not really sure what to automate. If you have some stuff that seems like it takes manual time but maybe you don’t know how to automate it or you’re not sure exactly how that would work, then it’s a good reason to push this off. What I found is things do become clearer over time. The more people you get, the more customers you get and the further along your app gets, things just mature and it becomes easier to tell how to automate things and what you should automate.
Mike: The last situation where you should consider pushing something off is if it’s a feature or a task that different customers are going to want different things or are probably going to want different things. This is where reporting falls square into this bucket but there are certainly other things where if there’s a presentation layer over the top of the data that customers might say, “I want to see these columns versus those columns. I want to be able to filter certain things out of the data right on the screen.”
Those are the situations where you can take the stands, here it is out of the box and we will get to those things down the road when they become more important or when enough people ask for them. But because different customers are going to have those different requirements or different needs around it, you can build a lot of customization around presenting data but people are going to want different things and it can take you a long time to build even just those individual pieces.
Rob: I think that about wraps us up for the day. If you have a question for us, you can call our voicemail number at 888-8019-690 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 in iTunes by searching for Startups and visit startupsfortherestofus.com for a full transcript of each episode. Thank you for listening. We will see you next time.
Episode 341 | How to Deal With Toxic Customers
Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike talk about how to deal with toxic customers. They give you some warning signs to help predict if a customer is turning toxic as well as some strategies to help deal with them if they do.
Items mentioned in this episode:
- Spark
- Laravel Spark
- Delicious Brains post
- Future Hosting Post
- Rob’s “How to Detect a Toxic Customer” Post
Transcript
Rob: In this episode of Startups For the Rest of Us, Mike and I talk about how to identify and deal with toxic customers. This is Startups For the Rest of Us episode 341.
Welcome to Startups For the Rest of Us, the podcast that helps developers, designers, and entrepreneurs be awesome at building, launching, and growing software products, whether you’ve built your first product or you’re just thinking about it. I’m Rob.
Mike: I’m Mike.
Rob: We’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s the word this week, Mike?
Mike: A couple of things. I’ve just pushed a major UI release for Bluetick to address some usability questions and stuff that kept coming up for people. It’s a massive improvement but it took forever to get it done. It was like a week and a half to get everything finalized, tested, and pushed out the door. It’s over and done with so I can move on from that side of things at this point.
Rob: Congratulations. That’s a big deal. It’s over and done with for three to six months until more usability stuff comes up.
Mike: It’s done for like three days. That’s what it really boils down to.
Rob: That’s a big deal. Congratulations. I know that this kind of stuff, it nags at you because you know it has to get done but it doesn’t exactly move things forward. It’s better than like doing taxes in terms of moving things forward for customers but it’s also not a new feature. It’s that balance of I got to push this.
Mike: Right. I think the part that made this piece so difficult was the fact that this was one of the areas that I knew needed to be rewritten for the past six months, to be perfectly honest, and I just didn’t get into it because I knew that it was going to be a hornet’s nest and didn’t want to deal with it at the time. But with that said, it’s like, I went through it, got most of the things cleared away, got all the code organized and commented properly.
Everything’s much more tested now more than it ever was before. It’s just so much easier to work with. I can go in and make changes now whereas before, I was afraid to touch anything because it might fall over and break.
Rob: That’s good. It’s nice to refactor as well. It sounds like it was a UI improvement as well as a code refactor. That’s two wins.
Mike: Now that that’s out of the way, now I can move onto more important things like the website and getting the signup process working.
Rob: Cool. For me, the only thing I have this week is we got a nice email from Victor Perolnick. He had listened to our previous episode where someone asked a question about resources for the engineering side of launching a SaaS. We had given a couple but it was mostly blog post and such. We did specifically say, “I know there’s going to be some out there for specific languages like if you want to do it in Rails, you’re going to find stuff. If you want to do it in PHP.
Victor called out Spark which is from Laravel which is a PHP framework for building a SaaS app. It’s spark.laravel.com. He also talked about Laracasts has a bunch of Spark screencasts if you want to see something really quick. And then link to a couple of blog posts that talk about it.
It gives you a head start if you’re going to build a SaaS app in PHP. Anyways, I wanted to call it out. We’ll link those up in the show notes. If you happen to be building in PHP, that’s probably where I would start.
Mike: I looked through some of those links that he had sent over and we’ll link them up in the show notes. The Spark system looked really nice for getting a SaaS app up and running and not having to deal with a lot of the fundamental plumbing that you would typically have to work with, the billing accounts, subscriptions, impersonation, and things like that. It looked like it was all kind of cookie cutter which is really nice.
Rob: This week we’re going to be talking about how to identify and deal with toxic customers. I wrote a blog post back in 2010, looks like December 2010 that we’ll link up. It was called How to Detect a Toxic Customer. It actually got a lot of traction on I think it was Hacker News at the time. It has like 72 comments or something on it.
I basically walked through a case study of what I had experienced with an invoice and a customer who is quite demanding and was just really combative. I talked about how to identify them and what to do. I find that this type of thing, it comes up every 6 to 12 months. If you’re running a SaaS app, if you’re selling software, it can be a challenge. You talk to anyone who’s been selling software for any length of time and they’ve run into something like this.
We’ve talked a little bit about this in the past on the podcast but I just want to walk through these steps of how to identify really early on, because one of the keys is being able to see it ahead of the actual person getting in and starting to use your app. Because once they’re using it, it actually becomes harder to force them to switch. It’s a really tough decision to do that. Maybe not at the same level of firing an employee that you mis-hired but it is in that spectrum of like, “Man, if someone gets in and they’re really using it and being a pain in the butt, it’s hard to make them switch.”
That’s where we want to start, early signs if you’re in conversation with someone that they may not be a good fit for you even before they ever get into your app. I have a big list here, mostly culled from this blog post.
You know what the first sign is that they view their “vendors” or they view you as like, it’s this weird attitude that you’re like somehow a servant or a slave to them. They’re extremely demanding. They treat everyone they speak with as if they’re an idiot. They talk down to your support people. They talk down to you whether you’re the founder or the salesperson, just this very demeaning tone. It’s like they expect everyone to bend at their will. It’s like they’re doing you a big favor for being their customer.
Mike: I think there’s a few different pieces to this part of it. Most of the time, you can identify this type of thing in the language that they use or how they reference the types of problems that they’re running into. Whether they say, “Oh, this is a massive problem in your app.” Or “Why doesn’t this work?” They get very angry and frustrated very, very quickly and things just escalate fast to the point that they see even just little, minute problems or UI glitches and things like that as a massive problem that calls into question everything that’s underneath the cover.
Most of the time, that’s just not the case. There might be a color that’s off or something is mislabelled or the documentation isn’t quite up to date and they’ll just blow things out of proportion and what you’ll find is that the language or the tone that they take with either the support emails that they send in or the calls that they make or even just the way that they get in touch with you.
If they send you an email and then five minutes later send you another one, that’s a classic sign of a toxic customer. The way that they communicate to you is heavily indicative of how they’re going to be to work with long term.
Rob: Yeah. I have that as a warning set number four in this article. This was an actual sequence of emails that I got from someone again with .NET invoice years ago. Warning set number four is unrealistic expectations. I got an email in support. It says, “Is your software localized for Australia?” And then literally, 10 minutes later, “I wanted to make sure you received my previous email. Is your software localized?” And then 30 minutes after that, “Hello, is anyone there? I haven’t heard back.”
It’s been 40 minutes since you emailed. This is insane. And then 20 minutes later, it was like an all caps thing of like, “Why aren’t you answering?” It’s like I have a feeling maybe I shouldn’t answer this one. If I answer the question and they spend the $300, how much more of a pain are they going to be later on? It’s unrealistic expectation, expecting everything to be answered or done yesterday.
Mike: I wonder if there’s a way like Brennan Dunn as you know is working on RightMessage.io, I wonder if you could somehow flag them and just jack up the price by like 10x to account for that kind of thing.
Rob: Yeah, that’s awesome. I think you make a good point about little things. You’ll have thousands of customers using an app and no one complains about a bunch of stuff and then one person will just have this such an issue and like, “This is a major issue.” Like you’re saying, it’s like all caps subject lines. Everything’s a bug instead of a feature request. It’s like, that’s actually the way you think it should work but everyone else is fine with the way it works. Or it’s like this fixed rigid mindset of you should do it this way because the only way to do it or that’s the way my old system did it.
It’s a bug since you don’t match the way my old system did it but it’s like that is a point of view but your point of view isn’t necessarily the right one. Again, telling back to toxic customers tends to think that way, the language they use early on and maybe the expectations that they have.
Another thing that I’ve seen and it was funny because I used to man support with .NET invoice and so I would answer a response and then I would get this threat to escalate like, “Can I talk to your support supervisor?” “Can I talk to the founder?” “Can I talk to the CEO?” Or “I demand to talk to the CEO is another one.” It’s like, “That happens to be me. How can I help you?” That would be my response but there’s always like really? We’re going to do this because there’s one misspelling or whatever it is. Like you said, the button caller doesn’t agree with how you want it to be.
To threaten to escalate, again, not always and each of these on its own isn’t the end of the world but it’s when you start seeing multiple of these go on over the course of a few interactions, your red flag should be going off.
Mike: I think the other interesting thing about these is that sometimes, it is just one thing that you can see and say, “This person is going to be a toxic customer.” And then there are other times where it needs to aggregate. You need to have several different data points.
If your first interaction is why doesn’t this work and it’s all in caps, it’s kind of a giant red flag but then, there’s other more subtle things that you get into and they add up over time. Sometimes, you don’t see them until much further down the road. As you said earlier, that’s when things become a problem because then they’re probably already in your app, or already using it, or have already paid for it. It becomes much more difficult to cut them off as a toxic customer.
Rob: Another potential sign of a toxic customer is that they provide way too much feedback. Every interaction with them is just a stream of consciousness of how they feel things should be different. We had people tell us like, “This word doesn’t make sense. You should rename that everywhere in your app to be this other thing. It should just say emails up there instead of broadcast or something like that.”
It’s like, “Okay, thanks for the feedback. We have four years of history of this being broadcast everywhere and that’s what all our documentation says. That’s what all of the marketing says.” It’s like everything calls it broadcast just because right now, you don’t understand that yet. In a week, you’ll know what that means and changing it to emails is actually more confusing.
I guess what I’m saying is it’s fine to get feature requests and it’s fine to get some feedback from someone but if every phone call you’re walking away with 10 different things that someone is asking for, there’s a potential there that that person may take their opinion a little, too seriously is not the right word, but it’s like they value it over your own or over the opinion of your company or your product.
Mike: The specific example that you just brought up about the name of a particular field, or a drop down menu, or just something that is presumably really just a label in the app, it brings up an interesting sideline about the fact that some people would go and say, “What can I implement and put in as a technical solution to this thing that keeps coming up where people wants to use different terminology?”
The thing I have seen a lot of apps do is allow you to rename things throughout the apps. So that instead of calling something emails for example, they’ll call it broadcast. If a customer comes in and says, “Hey, this should be called x.” You can go in and you could presumably change that inside of their user account, they would just propagate it throughout the entire app. But then, it makes it more confusing. It’s a little bit harder to support because all your documentation is probably not going to line up directly with that.
I think that you have to be a little bit careful about whether or not you put technical solutions in place for problems that are actually warning signs of problematic customers.
Rob: Totally, it’s like if everyone request that, then that might make sense but that’s a heck of a lot of work to do for one customer. If literally you have thousands of customers, no one ever complained about the naming thing and one customer gives you 10 things and a bunch of them are naming things, it’s like, “Really? Are you going to change that?
Everyone has an opinion and you’re building for the masses and a single customer coming in doesn’t understand the context, and they don’t understand that you do have thousands of other customers. I think that’s another kind of mindset thing with the hard customers that you deal with is they don’t have any context for the thousands or tens of thousands of other people who are already using it. I think that comes back to that fixed mindset thing I talked about earlier. That there’s only one way to do it and it’s the way that I think it should be done.
Another thing that I’ve seen is someone raising the same issues over and over. I guess it comes back to that email that I kept getting about the Australian dollar. They’ll just email back with the same issue everyday or every week even if you say like, “We’re working on it.” It’s like they feel somehow this anxiety or this sense of urgency and they need to, I don’t know, continue to force it on you.
I’ve also seen multiple contacts with the same issue through multiple channels. They email you. They call you on the phone and they chat. You’re like, “You’re actually making this harder on everyone because that mixes things up. Please don’t submit the same questions.” Something about urgency and expectations. It’s expectation of turn around.
If you’re a consulting firm, then maybe they’re paying you $50,000 or $100,000 and you have someone dedicated to them. If you’re a SaaS app and you have 10,000, 20,000 customers, even big customers, they likely will not be getting that level of turnaround time on their feature request. Again, if they were a consulting firm, then yes, they’re going to build what you say. If you’re a SaaS app, you’re not necessarily going to build everything everyone suggests.
Some folks have a hard time understanding that. Those tend to be the ones with misaligned expectations that turn into toxic customers.
Mike: The other thing that sometimes you’ll see is that they will, after a very short time period with your app, they will have several pages of “suggestions” for you to change. It’s partly just a lack of education on their part because they haven’t taken the time to learn how your app works and how it compares to things that they have used or done in the past, but they feel like they know better than you do about how this particular app should be built.
There are certainly exceptions to the rule here but generally speaking, you probably know the market way better than they do especially if you’ve been doing this, running an app, for any length of time and it’s a profitable app. They’re going to come in and they’re going to base all of their thoughts and ideas around their previous experiences.
A lot of times, you’ve designed around those because they weren’t good experiences or those other apps that you were competing against weren’t doing things in a way that made sense for most of the customers and really you’ve just been pushing yourself in a position to put in bad features because of their request. Those are the customers that you’re trying to avoid.
Rob: That’s a really good point. It’s a trip to see if you’re competing against apps and some of them will make what you see as poor design choices. Over time, you’re like, “Man, that’s pretty hacky.” Customers coming from those apps think that as the “right way” to do it even though it’s not. It tends to be a bad user experience for new customers but since they’ve been using something, they expect that to be the way, that’s the way things should be named, or that’s how it should work.
We see this with Infusionsoft to be honest. There’s just a lot of I would say questionable UX and design decisions but if you do it different than them, even in a what I would consider more modern or better way to do it, that’s much more efficient, it can confuse people who are used to thinking in the Infusionsoft mindset.
I think the last one for perhaps identifying toxic customers early is that they can expect a lot of special treatment. They’ll ask for extra services get thrown in and they’ll ask for almost always a big price break like they’re doing you a favor for being their customer. They get a price break that no one else asked for without giving a reason. There are just a lot of special favors that they can call in.
Again, if this is the only thing a customer does early on, alright that’s fine but if it’s coupled with these other things, it’s something to really be aware of and watch out for.
Mike: The big one here for like a SaaS app would be phone support or direct access to the founder which is justifiable especially in the early days when you’re the only one who is running everything or maybe you have somebody who’s doing some part time support. But it becomes a problem over time that can get bigger if you leave it unchecked. You have to cut those things off early if you can possibly help it but the people who have that expectation going in, that’s where you start running into the problems.
Rob: Now, we’re going to switch gears a little bit and talk about potentially how to handle this. Whether you detect it early or you get down the road a bit some strategies on what to do as this type of thing unfolds. I think I’ll start by saying that hard customers, toxic customers, they will by nature just absorb and suck away an enormous amount of your time. There’s someone out there who calls them time vampires.
I’ve seen folks that will literally just demand dozens of hours a week of your time based on the number of request and the number of the hand holding and the phone calls and all the stuff. It can really be chaotic especially if you’re running SaaS. If you’re selling downloadable software, I’ll tell you something we had to do with .NET Invoice a few times. It wasn’t often but it was maybe once a year, we would refund them. Tell them to keep the software, we refunded them and we basically ran away.
We told them, “Look, for $300, one time, we cannot provide this level of support.” And then let them be on their own. But with SaaS, it’s harder because if they’re already using you platform and you didn’t turn them away in advance, you have to force them to leave, to migrate away, which is a bit harder to do. We’ve only done it a very, very few times in the life of Drip. It really sucks, to be honest.
Like I was saying earlier, it’s close to but it’s not nearly as bad as hiring the wrong person but it can be a real drag which is why you’ll want to learn to identify these folks in advance, to see the signs early on in the sales conversation and try to cut them early because you have to ask yourself, is this going to be worth it in the long run? Trust your gut. If you see a bunch of these signs, it’s easy to talk yourself into, “We can work with it.” Or “We can manage expectations.” It’s likely going to get more complicated than that.
Mike: I think there’s an important distinction to be made here between the customers who are taking up a lot of your time because they have legitimate issues versus the ones who are being difficult. I’m in a situation now where there are certain issues that are taking up a ton of my time and there are some customers who are coming to me and saying, “Hey, can you do this?” Or “Can you do that?” I don’t want to say constantly but I’m getting fairly regular emails from them.
If you go through this list, you can say, “These people are problematic customers.” At the stage that I’m at, that’s actually not the case. It’s the opposite. I’m actually appreciative that I’m getting this feedback and these people are saying, “Hey, could you do this?” Or “Could you do that?” Because it gives me ideas and yes, I’m spending a lot of time on it but it’s also pointing me in the right directions. I need that right now.
If I were 100x where I’m at right now, that might be different but I’m not, so there’s a very big distinction between where your business is at in terms of how much time you’re probably going to be spending with the customers and whether or not they are problematic customer.
I don’t have any of those right now but you could certainly potentially mistakenly view some of those customers as all of these are problematic when the reality is your app is just not quite there yet and it still needs more work and there’s still a lot of effort that you need to put into it on the front end in order to be able to cut those issues off on the back end.
Rob: Totally. I am glad you called that out because especially in the early days, getting a lot of feature request feedback input, especially, there’s a tone element to it, if it’s not demanding. If it’s like, “Hey, have you thought about this?” Or “Hey, this would really help me out or this would be a great feature to build.” You’ll get emails like, “How have you not built this yet? I am shocked and appalled at the catastrophic way that your app does not do x, y, z. yet.”
It’s like it’s being shocked that it doesn’t, versus suggesting it as an improvement and realizing the software, especially SaaS, is an ever evolving thing, that everything is not perfect all the time, going to work exactly the way everyone wants 100% of the time. There’s a difference in tone. I agree with you. We’ve had a ton of people who give us a lot of really good feature suggestions.
You look at Brennan Dunn, he does it publicly. He does it via email. He gives us a ton of feature request, suggestions, ideas, and they’re damn good. These are things that really have leveled up Drip over the course of years. But he’s never been on that other side where he’s like, “I can’t believe Drip doesn’t do this.” I never heard the out of his mouth. It’s just this difference in attitude and tone.
Mike: A tell tale sign that they’re trying to be helpful is that if they apologize for sending feedback over. I’ve gotten that from several people where, “Oh, I’m sorry to keep bothering you with this stuff but it’d be great if you could do this or can this be done?” If they’re apologetic about writing into you for email support or anything like that, that totally puts them in a different category. They’re certainly not a problematic or toxic customer at that point. They’re the opposite.
But as Rob just said, it’s the tone of voice. You can tell from that whether or not that’s the case.
Rob: The thing to remember here, if you do have a really hard customer who’s demanding, is you have to keep your cool, you have to be kind, you need to be honest with them, and you need to be firm. The more you give in to irrational demands, irrational feature requests, there are actually things that makes sense, and you say, “Look, we are going to build that. That’s a great idea. Let’s do it.” And the person backs off, then you’re cool. You fixed the thing.
If they continue to still email everyday or every week like, “Why isn’t this done?” Then you know, maybe you’re tipping in that other direction of it being hard. If it’s rational stuff and you’re building it, then keep going. If it’s not rational stuff, if it’s stuff that you know is incorrect, bad for the product, bad for other customers, you’ve already tried it, it doesn’t work for whatever reason, that’s where you do have to be firm and you have to separate your emotions from the conversation.
If you can’t do it, you need to have someone like a support person or customer success person who can do that. Someone who is exceptionally good at this is Anna on my team. She would handle angry customers. She would handle toxic customers. Those two are different.
Mike: She’s talked to me a bunch of times.
Rob: Yeah, nice. Well done, Mike. But you know, you’ll have angry customers who are just angry about one thing. They get frustrated. You can smooth that over. Toxic is when they’re angry all the time. It’s the way I would put it. But Anna is really good at it. If you remember, I interviewed her, it may have been on ZenFounder actually, it was maybe 6 to 12 months ago, but we talked about dealing with negative emotions and how she was able to separate herself from the emotions coming from customers who are frustrated.
Like I said, this is by far the hardest thing to do especially if someone is making sweeping insults about you, your team, your intelligence, your application, but this is where you have to be kind, be honest, be firm, and not lose your cool, this is going to be the hardest thing to remember, and not let it derail you. Once you know that a customer is being particularly difficult, don’t let it derail your day, or your week, or your month because it’s so easy to do that.
In the best case scenario, someone who is difficult upfront winds up not actually being a toxic customer. Maybe they were just frustrated and they had several issues that you’re able to work with them, you’re able to fix them and they’re able to move on because there’s often this on ramping period where let’s say the first 30 days of using a new app, you’re confused by a lot of things.
Most of us go with it. We figure out how to use it. We don’t ask the app to change everything but some people are of that more fixed mindset. But if you handle a few of their issues and they like everything else, then it’s like you can move on and they really won’t be long term, won’t be that toxic customer.
I guess what I’m saying is often issues are clustered when someone first starts using your software. After that, they’ll calm down and people can understand how it works. That is the best case. I would say it’s not the norm but in the best case, if you do handle them with kindness, and honesty, and firmness, again, that’s the best case of coming out of this.
Mike: Something else to keep in mind with this is that dealing with customers is a learned skill. You might not be very good at it at first but you will get better at it over time. In addition to that, there are some people who just have a knack for this. Like you said, Anna seems to have a knack for it. She’s capable of separating herself from the problems and from the app itself and empathize with the customer.
Some people are better at that than others. Even if you train yourself and go through a lot of doing this type of support, and dealing with a lot of these types of people, it doesn’t mean that you’re going to be better than the next person at it or worse than them. Some people just have a knack for it and some people don’t. But with that said, if you don’t have a knack for it, you can get better at it. You can learn to separate yourself. It just takes time and practice.
Rob: To wrap things up, we talked about the best case which is working with them early on and then being able to transition them into a productive, happy customer. The worst case of course is that you find yourself and your team just living through ongoing stress for weeks on end. There are a couple of ways to approach this.
Firing a customer is not unheard of especially with larger SaaS apps. It depends on how you want to handle this. Sometimes, I’ve seen folks just plain ignore and just say, “Look, even if this customer sends 10 emails a day, we’re going to respond once a day or once every two days to all of them.” That is one way to handle it.
Or you can fire them. If they start being abusive to you or your staff, that’s not cool. You have to protect your people and your loyalty to your people in my opinion is going to go so much further than loyalty to one demanding customer. This is a hard decision because it’s not always black and white. You can have a toxic customer that’s not abusive. You can ask your support team, are they abusive? No, they’re just a little demanding and it’s like okay, then maybe it’s not time to fire them.
But if people are really shaking up, and you feel like things are rattling around, you have to evaluate at what point you let this single person have so much control over your team. Again, this is a hard decision. It’s always going to result in people being pissed off but if you find that you’re at that point, and you feel like you’ve done everything you can over the long run, frankly, firing someone who you think could cause this level of headache for you, for months or years on end, it’s the right decision.
Again, it’s like making a bad hire. It’s not as bad as making a bad hire but once you’ve made a bad hire and you know you need to fire someone, it’s a hard decision but over the long run, you always think to yourself, “Why didn’t I do that sooner?”
Mike: I was thinking about this and trying to figure out whether or not there’s a specific turning point or a hard benchmark that you can look at to determine whether or not you should just turn the tables and cut a customer loose because. Early on, you really don’t have any history with the person so you’re not entirely sure whether or not they’re going to stick around to begin with but you probably have an idea of what your lifetime value is for that customer.
If you’re looking at that and trying to track it back to how much time and effort you’re spending with the support, that’s not the whole picture. The whole picture is actually the impact to the rest of your day. I think that that’s not something that any of us would really be measuring. You might only take 15 or 20 minutes to answer a support request but if you spend the next couple of hours with that stuff turning at the back of your brain and it’s distracting you from doing other things, the time for that to cost you weren’t 15 minutes, it was 2 hours.
These things can be exponentially more damaging than you initially realized and in some cases, you have to be able to identify those people as early as possible just because you don’t want it to get to that point where it is causing you 5x, 10x, or 50x what it is that they’re paying you or would even potentially pay you if they were to stick around for 10, 20, 30 months.
Rob: To circle back, we’ve talked about some signs to look out for. We’ve talked about what to do. Hopefully, you’ve heard that the best case is that you can actually work with someone and help turn them around. I guess that would be hopefully something you can shoot for if you do find yourself amidst “toxic customer.”
Mike: With that, we’re going to wrap up for today. If you have a question for us, you can call in our voicemail number 1-888-801-9690 or you can 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 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 340 | Hiring VAs, Struggling with Engineering, Bootstrapping vs. Raising Funding, and More Listener Questions
Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike take some listener questions about hiring VA’s, struggling with engineering, and bootstrapping versus raising funding.
Items mentioned in this episode:
- Gofccyourself
- Dear FCC
- Fearless Salary Negotiation
- Virtual Staff Finder
- Upwork
- Scaling SaaS
- Meet Edgar
Transcript
Rob: In this episode of Startups For the Rest of Us, Mike and I discussed hiring VAs, struggling with engineering, bootstrapping versus raising funding, and more listener questions. This is Startups For the Rest of Us episode 340.
Welcome to Startups For the Rest of Us, the podcast that helps developers, designers, and entrepreneurs be awesome at building, launching, and growing software products, whether you’ve built your first product or you’re just thinking about it. I’m Rob.
Mike: And I’m Mike.
Rob: We’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s the word this week, sir?
Mike: I have a website for you. It is called gofccyourself.com.
Rob: Really, I’m clicking on it right now. That sounds dubious. Is this safe for work, as they say?
Mike: It is safe for work. This is actually created by the Last Week Tonight show with John Oliver. The idea behind them putting together this website was that there’s some pending discussions inside the FCC about whether to deregulate certain parts of the internet specifically as it relates to internet service providers. It allows them to essentially self police themselves in a way that they decide whether or not what they’re doing is morally correct and net neutral, which is obviously not a good thing for net neutrality in general.
The FCC has made it very difficult to get to the page where you can actually leave comments in support or against this particular piece of decision making in the process. John Oliver and his team put together this website. It’s essentially just a redirect that takes you directly to the place where you can fill out the form and leave a comment.
If you’re interested in contributing your voice to that net neutrality legislation, then go over to gofccyourself.com. I’ve already done it. It does take a few minutes. I thought it would take two minutes so I’m hesitant to say that because it took me like 10 but I think that it’s well worth putting your voice into for them to hear it.
Rob: It looks like there’s another URL, dearfcc.org.
Mike: It’s the same type of thing except that, I believe, it sends a physical letter as opposed to just commenting directly on the FCC’s website.
Rob: Got it, very cool. Hey, we had a comment on last week’s episode. I thought it was a pretty thoughtful comment. I appreciate it. It was from a guy named [00:02:17]. He said, “Hey, first time commentary. Congrats Mike on reaching your MRR milestone. What makes it more impressive is you did it in spite of all the armchair criticism. All the more power to you.” I didn’t even read that part. That’s funny. He said, “I did want to say that hearing Rob talk about hiring an in house nanny and how everyone should get hired help was a little bit perhaps insensitive. Not sure if that’s right word but Mike’s response pretty much sums it up. Similar to a guy who could afford to fly first class and tells everyone they can’t imagine flying economy again and that everyone should fly first class.”
I appreciated his comment. A couple of things, first of all, I felt like the first class analogy was a little, maybe didn’t translate to what I was saying because flying first class is like 5 times, 10 times more than normal flights and the only value is comfort and perhaps snobbery whereas I was genuinely saying outsourcing stuff. It’s not about having a live in nanny. It’s about not mowing your lawn. That’s really what I was talking about.
I had switched topics by this point to if you’re a founder and you’re still mowing your lawn, and you’re pressed for time, and you don’t have time to spend with your kids or work in your company, and you’re still mowing your lawn, or shoveling you snow, or cleaning your own house, that’s not a money decision at that point if you’ve got any type of success.
I used to pay $55 every 2 or 3 weeks for a house cleaner. Most of us can swing that. None of this is stuff that I started doing after I sold my company. I started hiring small amounts of outsourcing over 10 years ago when I was literally making just a normal salary gig but I was trying to do stuff on the side. I wanted to clarify that and also say I apologize if I came off insensitive. Did you feel like I did?
Mike: I don’t think so. I actually thought it was kinda funny when you said I’m not advocating outsourcing your parenting of your kids and I was like, “Why not?” Isn’t that the point?
Rob: Mike’s like, “I am advocating outsourcing raising your kids.”
Mike: I was like, “When did we decide to go against that idea?”
Rob: Totally.
Mike: I could definitely see what you decide could be misconstrued. I don’t think that that was your intent. As you said, the conversation had shifted from one topic to another in the middle of it.
Rob: Right. I don’t think everyone by any stretch should have some type of live in nanny. Sherry and I have been talking about that for five or six years. We haven’t been able to do it. We just didn’t have the house that it worked for back in Fresno. It really doesn’t have anything to do with suddenly having more money. I’m not advocating everyone should get a live in nanny. It’s game changing for us but that’s a personal choice.
The part that I am saying entrepreneurs and founders should do if you’re strapped for time, and all of us are, is that you should be outsourcing more of your day to day groundwork. That’s a decision you’re going to have to make early on. It’s like hiring a VA, I’m going to pound that drum forever, but if you’re still answering your own email support and you’re more than about 3 or 4 months into your product, you’re making a bad choice.
You can try to tell me it’s not a bad choice but I’m going to tell you over and over based on my experience and the experience of everyone who I’ve told this to, who haven’t hired someone says, “Oh my God, why didn’t I do this years ago,” that you should be doing it. It’s a different thing but hopefully that clears it up and is a little more helpful who think I’m some type of pretentious d-bag.
Mike: Monster.
Rob: I’ve always tried to be on this side of that argument.
Mike: I do think that there are certain cases to be made where you don’t outsource that stuff. For example, like mowing the lawn. I find that sort of therapeutic because I listen to my headphones and podcast and stuff like that while I do it. That’s a regularly scheduled thing that comes up versus something like snowblowing the driveway and taking care of that where you’re much less in control of the weather and those things pop up and it needs to be taken care of. That is easier to make that decision on than something like mowing the lawn where it’s predictable, I’ll say.
Rob: Yeah. If you’re saying it’s relaxing for you, that actually is a good argument for it. I would say alright then, that’s not a bad choice. I actually cook quite a bit because cooking is not a chore to me. It’s actually something that I enjoy. I do outsource part of it. A lot of the prep, I use Hello Fresh or Blue Apron so I’m not going out shopping. It’s more expensive for sure but it saves me time.
Cooking itself, the act is similar to what you’re saying. I typically have a glass of wine and I have podcast playing and so it is actually relaxing. That’s a good point too to bring up. It’s only if this is something that’s detracting from your life.
Mike: I think that’s the point. If there are certain things that you can outsource because they are detracting from your life or they’re inconvenient, that was really I think the point that you were trying to make with the nanny. There are times where it’s inconvenient to drop what you’re doing to do something like picking up the kids at a specific time. You don’t have to be the one that does that. Again, that’s very different than being the person that are parenting your kids. Those are just two very, very different things. I think the distinction got muddled in a conversation, that’s all.
I just want to bring up a comment that we got. This one came from Josh Doody. Josh gave an attendee talk at MicroConf. One of the things that he talked about in his attendee talk was about SEO. This relates back to episode 338. He just said, “Hi, I just listened to episode 338. Summary of the Moz case study on ranking number one for competitive head terms. Really good stuff. I heard a couple of things that I’m going to try to keep improving the SEO on fearlesssalarynegotiation.com. I added the episode link in the case study that linked my MicroConf summary page. I think my talk in some of the links on that page could help people get started with SEO. My talk was a one on one level talk where I would say the Moz case study is 201 plus.”
He gives a website URL. It’s joshdoody.com/microconf. We’ll link that up in the show notes. Anyone who wants to go take a look at that, it’s a really good overview of what his talk was and it is some practical strategies if you’re not quite to the level of where that Moz episode that we did and all the different things that they did for SEO. If you’re not quite there yet, head over to this link. Again, it will be on the show notes. It gives a lot of the basic tactics and stuff that you can use to help your website rank in the search engines.
Last before we get started. I did not know this but apparently, for the past two or three years, there has been a Viking combat training facility here in my hometown.
Rob: Do they teach you to fight with the axes?
Mike: I think that they put stuff over the ends of them. I saw them training one day out in a parking lot. They have these giant bo staffs, they almost look like giant erasers or q tips or something like that. They are like padded on ends and they look like they’re ready to beat the snot out of each other in the parking lot.
Rob: That’s awesome. Your town is not that big so it’s kind of odd that you wouldn’t have known that.
Mike: I know. That was the part that struck me as odd. It’s literally called the Viking combat training center.
Rob: That’s fun. Last time we were in Italy, my son and I did gladiator training in Rome. It was like a one or two hour little adventure where we had foam swords and you wore the helmet. The stuff is bulky and heavy. It was super fun to learn kind of the different approaches to combat though.
Mike: What’s on the agenda for today?
Rob: Today, we are answering listener questions, trying to play catch up. I think we have one voice mail and a few written questions. Our first question is from Richard Gorbet. He says, “Hey Rob and Mike, love the podcast. Only one I have to auto download when a new one appears. A couple of years ago, there was a lot of chat about virtual assistants. Is it worth a new topic in one episode as I suspect the dynamics may have changed. I’m thinking from a help desk perspective but many, many uses for a VA. It’s come to my thoughts as my latest ideas about MVP in the next few weeks. Thanks.”
What do you think about this? I don’t know that it’s so much different than the previous thoughts we’ve had. Maybe the specifics of hiring have changed slightly but I think we talked about 15 ways to use a virtual assistant. I think all of that is still the same. That stuff hasn’t changed. What do you think?
Mike: I would agree. I think the specifics of how to go out and find somebody and vet somebody to do those things has definitely changed over the years but I don’t think that the types of stuff that you would have them do is going to change all that much. It’s probably going to be more of an evergreen topic to be honest. It’s just there’s always ways to save yourself time.
The one thing that I think that might change over time is that as the level of skills of people that are available at a certain hourly rate, that dynamic shifts over time. You might be able to find people who are more qualified to do things that are probably further along than what you would think that a typical VA would be capable of. Again, that’s going to be shifting the global economy in terms of who is available at what hourly rate and stuff like that. It’s not really a dramatic shift in what you would have them do. It’s just a matter of what people are skilled at, at a particular hourly rate.
Rob: I actually think the hiring process, at least the one I outlined most recently was through oDesk. That’s still where I would go today. I would use that or I would use Chris Ducker’s service, virtualstafffinder.com. It’s Virtual Staff Finder, that’s the URL. If I recall it was like $300 or $400 to pay them and they basically vet a bunch of candidates and then they give you the top three. They guarantee them, that if they don’t work out in the first whatever days, they’ll replace them and stuff.
If you have the funds, I would do that if you’re in a hurry. If you have less funds and more time, then the oDesk approach that we’ve outlined, I guess it’s Upwork now, the Upwork approach that we’ve outlined in the past is what I would go back to at this point. Thanks for the question.
Our next one is an anonymous question that he actually sent to me directly. He say, “Hi Rob, I’m in the process of creating a B2B SaaS app for universities but I’m struggling with the engineering of the application. What resources such as books, tutorials would you recommend for developing a SaaS app on the web? I’m a huge fan of the podcast and of your book. Thanks for all your help.” What do you think, Mike?
Mike: It’s funny, as I’ve been developing Bluetick, I‘ve come across various topics where this type of thing would be very highly relevant. I’ve looked around and depending on what you’re doing, it can be very difficult to find this type of stuff. It kind of actually spoke the idea of writing the technical side of developing a SaaS application, a book that basically covers that topic. The problem obviously, I just don’t have the time to do that kind of thing.
There’s also just a wide variety of topics that as a SaaS founder, you may run into them and you may not. It depends on the type of SaaS that you’re building and how data intensive it is, how much search you have to do, if you have to do data indexing. A lot of times, you can get away with just very basic stuff and then when it breaks, then you fix it.
I think it’s very easy to go down the path of trying to engineer something to work for the largest case that you could possibly envision your app doing and then get into it and realize that you’re not going to hit that for six months, or a year, or three years. You’ve over engineered the early stage stuff. There are certainly things in Bluetick where we’ve had to rewrite them two, three, there’s sections of the code where I’ve rewritten it four or five times just because the backend stuff has scaled to that point.
Had I sat down and just designed it on day one to try and reach that scale, it would have taken me so much longer to get something out there. I think you really have to just weigh what it is that you’re trying to accomplish and what those short term goals are which your primary ones should be get something working in front of people versus how do I make this thing survive in the long term.
Unfortunately, that’s something that’s sort of diametrically opposed to each other. You don’t want to have to rewrite code more than once or twice if you don’t have to but at the same time, in order to take those shortcuts, you almost need to build those sections of code as prototypes just to get to where you need to be and get that revenue in the door.
In terms of looking around and trying to find specific resources, I’ll be honest, I looked around and I could not find very many. There’s all the generic stuff on how do I build an application or how do I use this particular type of technology, and those are great and helpful but they don’t give you a much broader picture of how do I handle authentication or how do I handle permissions inside of a system.
There are different areas you can go into like claim space authorization and all these different things. At the end of the day, you got to pick what is right for your application and what is going to get you as far along as possible with the least amount of effort.
Rob: The hard part of this is if you get into like how should I do authentication, it’s going to depend from language to language. You should use the built in .NET stuff for .NET but in Rails, you should use the built in Rails stuff. You almost have to go one level higher and talk about concept.
I agree with you. I don’t know of a single good book or tutorial course about really the high level engineering side that’s not language specific. I went to Google and typed in how to build a SaaS application. There’s actually some decent stuff. There’s a good conversation on Quora. There’s a good article on Glenn Stovall’s blog. He’s a MicroConf attendee. He talks about all the technology he would use and it’s like 19 apps in a row. He made the list. Thanks Glenn. I haven’t even noticed that. That’s kind of funny.
That’s where I would start. Again, I don’t know of any tomes, any books, any dead tree of things that are out there. It’s much more going to be about blogs, article here and there. I do know that there are people out there like Derrick, my co founder, has a blog called Scaling SaaS. It’s at scalingsaas.com. He talks about challenges that he’s run into and how he’s fixed them but it’s not a step by step tutorial or a really deep dive into engineering a SaaS app. Perhaps, there is a gap in the market here that someone would be interested in filling.
Or if you have heard of some good resources for stuff like this, feel free to write in questions at Startups for the Rest of Us and we’ll be happy to mention them in a future episode.
Laura: Hi, this is Laura Roeder from Meet Edgar. Hey guys. I was wondering about Rob’s perspective on bootstrapping versus fundraising now that you are operating inside of Leadpages, a funded company. I’m a bootstrapper, I know you guys have been big proponents of bootstrapping over the years. What have you learned being inside of Leadpages about bootstrapped versus funded companies and has it changed your point of view at all about what you might like to do in the future? Thanks.
Rob: This is a really interesting question. The hard part is think about how I run a bootstrap company versus maybe how you run one versus Reuben Gomes versus Josh Pigford. I don’t know if you can say there’s one way to run a bootstrap company and so I can only compare the way I run them with the way that the Leadpages team runs them.
If you think about a funded company in Minneapolis run by Clay Collins and his two co founders, started as a distributed company and then raised funding and grew to 170, 180 employees at this point, it’s probably a different trajectory. They’ve always been profitable. Different trajectory than a funded company in the bay area that maybe B2C, has never been profitable and is hiring a boiler room of bros to make the phone calls.
There are a lot of different ways and thoughts around raising funding and different ways to run a company. I guess I want to couch that in advance by saying it’s only one person’s experience. It’s with basically two companies, comparing them to one another.
The base thing I’ve learned moving to a funded company is that it’s so freeing and amazing to not have to worry about resources, to not have to be concerned with adding a $200 a month server or upgrading the database over to a $2,000 a month box. You know it’s going to fix your problems but you just don’t know if you have the money to do it.
That is gone. I’m not saying money is infinite but compared to the bucket we were in a year ago, before the acquisition, money is essentially as close to that as you can get. Anytime we bring up a problem and we’ll say, “Here’s how to fix it but it’s going to cost this.” The cost is actually the afterthought in the conversation. That’s very freeing and it allows us to operate quickly. We can hire. We can pay market rates. It’s like having the resources, it’s crazy.
Especially because we’re not doing the crazy I’m going to raise $20 million and do the B2C shuffle where we just hire way out ahead of sanity. You hire 20 people before you hit product market fit. We’re not doing that. We’re literally hiring to scale. This is the perfect time at which I would have raised funding if we were going to. It’s a point at which you have product market fit, you’re growing quickly and you’re just pouring money into either scale the marketing or scale the engineering. That’s been cool.
The other thing I’ve learned is that specialization is amazing. The fact that they don’t have people who do support and customer success and marketing, we used to have a Drip when there were five of us. There was one person doing support. To be honest, there’s like eight people doing support for Drip. Marketing is divided into like some people just write blog posts. That’s all they do all day. And then there’s this person and all they do is all the social paid acquisition. There’s this other person and all they do is the search paid acquisition because they have the staff to do that.
Specialization is extremely powerful because you can get so good at stuff. This is when we see these case studies like we talked about last week. It was two weeks ago, about the SEO stuff, the reason those people are so good at that and can write that incredible case study is because that’s all they did. That’s all they did for 90 days straight, was work on that one problem and you can accomplish a lot doing that.
I think another difference and I don’t think it’s not a fun diverse thing but like Drip was an engineering driven culture because I’m an engineer and so is Derrick. Leadpages and marketing is different culture so it’s a different way to look at it, a different way to run a company but that’s not because they’re funded. It’s because they’ve always been that way. Clay, Tracy, and Simon bootstrapped Leadpages to, I don’t even remember what the number was, but it was several million dollars in annual revenue. They kind of are a bootstrapped company that then raised funding.
I think those are some cursory thoughts. I could probably do about a 20 minute rant, not even a rant, just a conversation of me talking about the differences but I think those are probably the most pronounced.
Mike: I think the only thing I’d add to that is that there’s this I’ll say sort of a pervading fallacy that when you start talking to not self proclaimed experts but the people who are leading the masses when it comes to startups, you look at them and your immediate thought is, “Oh, they know what they’re talking about and that’s the way to build a business.”
The reality is that that is true to an extent, however, there are lots of ways to be successful and there’s more than one path to do it. There’s no one true path. There’s no one silver bullet. There’s no one way to do things. There’s lots of ways to do it and be successful. Just because it worked for somebody else, it doesn’t mean it’s always going to work for you and that when you’re looking at those types of examples, that’s one path. There are lots of others that may or may not work for you. It’s about finding what will work for you.
Rob: It’s interesting. There’s always these big things about don’t raise funding because you’ll lose control, or you’re going to make bad decisions because you have too much money, or you’ll feel all this pressure from investors. I’m not the founder or the CEO of Leadpages but I don’t feel like I’ve lost control like we’re being pushed to make bad decisions because we have “too much money,” or that there’s all this pressure from investors. Perhaps the board or the CEO, Clay feels different than that.
It’s not this black and white dichotomy that so many people make it out to be. You and I have never done that. We’ve never been anti funding. We’ve always been anti the dumb B2C startups that have no product trying to raise all this money and go viral. It’s the stupid Silicon Valley stuff.
For 10 years, I’ve been saying there’s a right time and a right place to raise funding. I think it’s post product market fit. You bootstrap to that and then you add the fire to grow the company. Typically, it’s going to be more B2B although if you had a B2C that had hit, I think there’s a good time to raise it as well.
It’s really interesting. There’s a lot more to talk about. Maybe we’ll record an episode in the future and revisit that whole topic.
Mike: Yeah. I think you and I are more anti pipe dream where you have something that you’re putting out there but you’re not charging for it and you don’t have any way of making money. The reason you need funding is in order to increase your reach and get it in front of more people. And then, at some point down the road, you’ll figure out how to make money from it. If you can’t do that very early, then it makes it difficult to build a business out of it.
Rob: Right. We’re anti billing slide decks and asking for permission instead of actually building a company. You should be able to build your company to the point where people want to invest without any funding. It’s very, very rare exceptions. Maybe hardware, although even these days I would say do a kickstarter. Maybe there’s something with incredible computing power, something that you can’t have access to and I would say build something simpler first.
For the most part, most of what we all do, you can bootstrap that to the point where it becomes very interesting to investors.
Mike: I think that about wraps us up for today. If you have a question for us, you can call it into our voicemail number 1-888-801-9690 or you can 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 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 339 | Updates on Bluetick, Drip and Other Madness
Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike give updates on Blutick and Drip. Mike talks about some progress he’s made as well as his current MRR with Bluetick. Rob gives his update on Drip continuing to scale and fill new positions.
Items mentioned in this episode:
Transcript
Mike: In this episode of Startups for The Rest of Us Rob and I are going to be talking about updates on Bluetick, Drip and other madness. This is Startups for The Rest of Us episode 339. Welcome to Startups for The Rest of Us, the podcast that helps developers, designers and entrepreneurs be awesome at building, launching and growing software products whether you’ve built your 1st product or you’re just thinking about it, I’m Mike.
Rob: And I’m Rob.
Mike: And we’re here to share experiences to help you avoid the same mistakes we’ve made, what’s going on this week Rob?
Rob: Well I’m back to feeling really good about Drip because for the last maybe month, prior to last week, which I talked a little bit about it. We just had you know scaling issues right, it’s like stuff comes up, you don’t know if it’s database, you don’t know if you can add more horsepower to it, code implementation, you know what it is. So, different times of day certain ques would back up and it’s like we’re shipping a lot of features, the team is kind of firing on all cylinders right now and I feel like we’re the most productive we’ve been in ages perhaps ever,
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Rob: I mean just given that the time size is so much larger, we’re able to just ship stuff faster and yet, like every week was ruined for me because there would be this delay or whatever, this page load is slower, just whatever that like makes me feel like we’re aren’t living up to the promise that we make to our customers, but we turned like a big corner last week with it and I just feel great about everything. So that’s my week.
Mike: Yeah, I know what you’re saying. I think the best analogy, I might have heard this someplace but I kind of feel like I thought of it on my own at 1 point, is like when you’re working on a SaaS app like everything is in motion while you’re working on it, so it’s almost like being a heart surgeon like you have to make sure everything stays up and running while you’re still working on it.
Rob: Totally, that’s right, Reid Hoffman the founder of LinkedIn said building a startup is like jumping out of an airplane and assembling the parachute on the way down right, because you kind of in free fall and you’re burning through cash and the analogy works really well for running a SaaS app and having to do kind of performance improvements, refactors, anything like that that impacts a lot of things and this is where unit testing is such
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Rob: a nice scaffold right, unit testing is like having good test coverage, it’s kind of like jumping out with the parachutes already half made or maybe the parachute is, I’ll just stop there because that was a really dumb analogy anyway.
Mike: I was going to point out, I wasn’t sure where you were going to go with that.
Rob: You’re like you’re really taking this too far, let’s ditch the parachute thing.
Mike: That’s almost like my analogy against a heart surgeon.
Rob: How about you, what’s going on this week?
Mike: Well minor champagne moment, I’ve recently crossed the 1,000 dollar a month MMR with Bluetick, so things are going in the right direction. Of course, because it’s the beginning of the month you look at the statistics for growth and stuff like that and they’re just tanked at the bottom which because it’s the beginning of the month instead of the end.
Rob: I know you’ve got preorders up front but this is active customers right, these are people that are actually using it and not people who have paid you and are planning to use it.
Mike: Yes, these are people who have paid me and are currently using it.
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Rob: Sounds good.
Mike: Yeah, most of the people I had who had come in as preorders and then converted over into paying customers, a lot of them I had essentially applied credits to their account to give them credit for that preorder to some extent, mostly to kind of boost them over from being a preorder and kind of having an indefinite beta period over to like being a paid customer and those payments are I think going to be starting to kick in this month but even with all of that it’s still over 1,000 dollars a month and my goal for this month is to double it but we’ll see how that goes.
Rob: Wahoo, a 1,000 bucks a month man.
Mike: Yeah.
Rob: Are you going to Disneyland, are you going to go out and buy a new car?
Mike: No, I had a beer last night, that was about it.
Rob: Nice, that was your champagne moment, was to drink a beer.
Mike: Yeah, champagne, beer, I’m sure somebody’s going to have a coronary over that analogy.
Rob: Nice, do you feel like the pace is picking up in terms of how quickly you’re adding customers?
Mike: It is and that’s both intentional but also as a byproduct of people talking about it because they are
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Mike: using it and they’re having good experiences so they’re turning around and referring other people to it and saying hey I’ve been using this and it’s been working really well for me, that and coupled with some of my outreach efforts, they’re either going on podcasts or talking to people who are on mail lists. It’s a combination of things but I’m definitely pursuing things a lot more in that regard as well and it’s unfortunately a juggling act too because there are things that come in and people say hey, can it do this or can this be modified, can we add a feature or a function over here that does X, Y or Z and it’s prioritizing those against all of the other things that are going on, it’s really pretty hard.
Rob: Yeah, that’s how it always is right, especially in the early days man, it’s tough. That’s why starting on your own and really being the single founder is such a hard road to go if you’re going to build an app like this that’s not in a small niche market where you can move slow and there’s no competition and you can kind of trudge along but building something like this, where there is competition and you’re going to have to be keeping up, you need to get to the place where you’re keeping up enough revenue to basically hire somebody
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Rob: soon and essentially, Justin Calcian says hire your cofounders, right that’s what he does now. He doesn’t have cofounders but he hires really early because he races around and he has a little he can back it with and he’s able to give our less equity but he brings people in very early, you don’t see him building something solo or alone because there’s just too much to do when you’re launching something that you want to see grow pretty quickly and it’s in a big market.
Mike: Yeah, I meant there is definitely things that are kind of falling on the floor right now, I mean 1 thing that’s been sitting on my to do list for well over like a couple of months at this point has been working on the sales website and even people who come through the sales funnel when I start talking to them, the biggest chuck of questions that they have is kind of what does this actually do, because the website doesn’t explain it very well and really the website is just 1 page, so there’s not a whole lot of explaining that it can do on that 1 page, it doesn’t provide use cases or examples or screenshots really, I mean there is very little there to go off. Most people are really reliant on what they’ve been told by other people or what they’ve heard about either from me or from other places where I’ve
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Mike: done like a podcast interview or something like that.
Rob: You know it’s really cool when you say that some of your new customers are coming from other people using like word of mouth was a big driver in the early days of Drip, not as much with hit tail but there was some but if you have that already, like if you have that when you only have low double digit number of customers, that’s a good sign, right it’s a really good sign because as you grow that’s just a snow ball that allows you to continue kind of leveling up and when you add 100 or a1,000 if you still get that same percentage of people, you’ll always be lower as time goes on right but if you can get folks talking about it, it’s a really nice way to be involved in every conversation right, you always want people to say remember how like infusionsoft and Ontraport, it was always just the 2 of them and just by nature of that fact Ontraport which is nowhere near the product that infusionsoft is, you know had all of this growth and then I remember when Drip started to be part of those conversations when they would say of infusionsoft or Drip and I would like see it, I would say it’s
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Rob: not in every conversation about it, but I would see it in these online forms, these threads and then get thrown out and I remember when that started happening and it was gaming changing because you just become another viable option rather than a tool that no one has heard about.
Mike: Yeah, 1 of the things I do, I think it was 1 of the 1st questions that I ask in the survey when you go to Bluetick’s website and ask for an invitation code, 1 of the questions in there is where did you hear about this, so from that I’m finding out exactly who people heard about the product from, so it’s nice to be able to track it back to people who either placed preorders or are current customers, I even have 1 customer who like has a bunch of customers that he works with and he’s going to start recommending it to them because he’s had such a good experience with it and they wanted to use it internally 1st and things have gone well in that respect, so now they’re turning it around and going back to their customer base and say hey let’s get you on boarded with this so that we can help you more. So, what about you, what else is new?
Rob: Well, you know as I talk about most weeks most of my updates involve scaling
[00:08:00]
Rob: Drip and hiring people, right. That’s kind of a big focus of mine now, there is some other stuff, I might get into it later depending on how much time we have today but I feel you know we have been pretty consistently, just we’ve had an open job, at least 1 job opening since we got acquired and most times we have either 2 or 3, so we’re constantly, we’re hiring other new front end like IUIUX, new rails folks or new people to help with scaling and I feel like I’m kind of in the groove of hiring at this point, like I’ve gotten pretty good. You know it’s kind of this skill that you go in and out of because when you’re not hiring you forget how to skim through a resume really quick, how to do a quick phone interview, how to do a quick phone interview but we’ve just been doing so many recently that I feel like I’m kind of in the groove of it which I don’t know that I necessarily want to be, hiring people is not an aspiration of mine, like I think we’ve always talked about like my book start small stay small, the small was about head count, not about revenue right. I always want to grow revenue but it’s like I want to keep head count down, but
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Rob: in this case it’s even just looking ahead as we’re Xing, 2 Xing, 3 Xing every so often it’s pretty frequent that we’re doubling our customer base, we just have to hire a little bit ahead of where we actually are, as well as like I said earlier, being in a competitive space we need to continue delivering features, which as we’ve talked about in the past is harder and harder to do the bigger you get because you spend so much time just maintaining what you already have right, making sure the database is ahead of everybody’s need and the code base and the ques and just all of the stuff that you’re running. So yeah, I guess to summarize we’ve been hiring a lot, I’m hoping we can slow down here pretty soon, we’ve found some really good candidates and I guess it’s getting in the groove of it. I do like doing a bunch of hiring and stopping so that I don’t have to constantly you know being doing it and can kind of focus on other things.
Mike: So, is that going to be the focus of your next book is how to hire people at scale?
Rob: Oh, my gosh seriously. No, it will
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Rob: definitely not, and like I say it’s super cool when you get a new person on board and you get them up to speed and they start contributing and like Derek and I looked at each other and we’re like we are shipping a lot of features and it’s because there’s all these people you know doing things that used to be either in our lap or we just pull, hey we have a scaling issue so we’d pull 1 developer off of something and now we don’t have too, like we have dedicated people who that’s all they’re doing and I keep saying we’ve hit our stride. I hate to keep using that analogy but it really does feel like we’re getting the right people in the right roles and it’s kind of a good feeling when you do slot somebody in and you see them start shipping things, you’re like man I’m really proud of what we’re putting out even we’re not doing all of the work anymore because you think back when you’re crafting this software or you’re crafting the UI, with Drip that was really all Derek right, it was he and I deciding what to build and me handling everything else but for so long it was all bottle necked by 1 or 2 people’s bandwidth but now with the growing team it’s neat to see that
[00:11:00]
Rob: we’re able to maintain the efficiency and still continue that hiring more people actually means we can push out more software rather than in other companies I worked at where hiring more people actually makes things worse, you know it like slows everybody down.
Mike: Yeah, I definitely hear what you’re saying. Do you find that as you are adding more features that like the individual features that you’re adding tend to be more invasive throughout the entire course of the apps, so it’s not like a little surface thing that you can toggle here or add over there, it’s like you’re adding this feature that needs to be added throughout a large part of the pipeline of the applications?
Rob: You know that doesn’t come up too much to be honest. I think in the early days it did because you’re just trying to get to that point where you built something that people want, but I think these days our product is so much more mature that there are things we add now and again that impact everything but our architecture is really solid, so things are broken out into their own subsystems and such. While there certainly are some that come through for
[00:12:00]
Rob: the most part a lot of these things seem to be more self contained I’ll say, I mean it may impact 5 files or worst case 10 files and you have to go through all of these layers of something and those are the ones that get a little scary right because you’ve got to make sure you have unit test coverage like crazy on that but yeah, I would imagine you’re probably in that boat though right where kind of everything you add it’s like oh gosh I have to go rearchitect this thing in order to do it.
Mike: Yeah, and that’s kind of why I was asking because I find that a lot of the changes that I’m making tend to be stuff that have to be tracked down or tracked all the way through from the front end all the way through the API and then into the service layer and the security layer and then into the database and it gets to be, I don’t want to say frustrating but it takes a lot longer to get some of those things done than I would like especially because of all of the maintenance and ongoing requests or butt fixes and things like that, there are just tweaks and adjustments that kind of invade into that space while I’m trying to get those things done, it’s
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Mike: just, it’s honestly like the juggling act right now is really pretty hard, so I was just kind of curious of whether or not you still ran into those things, so maybe there’s light at the end of the tunnel for me.
Rob: Yeah, yeah there is but it takes a while. I remember we refactored Drip, like major database refractor probably twice before we got to launch right, so Derek broke ground on code December of 2012 and we really launched to the world in November of 2013 but we had kind of our 1st group of 10, 20 customers coming on as early as June of 2013, so that was 7 months in and I think within that 1st 6 months before we really had people he had to do a massive rip apart of things we just had made decision to couple and they shouldn’t have been coupled and then there was another 1 when we launched, automation right so that was early 2014 as he was building automation that was just painful, it was like 2 months of standing still and then he built automation, once he had it done the automation stuff was actually not so hard to build but it was like we have to rip
[00:14:00]
Rob: separate these 2 database tables and you know as you’re falling down making your parachute and it was gnarly but after that like once we hit there, we’ve had limited need to do that because I think the building blocks got in place and the product was solidified. Now us marking automation and we’re not going to add on shipping cart landing page, affiliate marketing management, you know what whatever else, that would all I think impact some of this other stuff where as you’re still figuring out, like where I would guess at your stage, we were still figuring out I should say, so really trying to figure out should I build this feature, what is this product going to become, what is the vision for the product and is my vision still aligning with what the market is asking for and that makes things very fluid, I think is probably a good word for it.
Mike: Yeah, I’m having the same types of general conversations with most people when it comes to either features that they want implemented, like the road map that I have in my head, it’s obviously different than I originally started out with but over the past several months it really hasn’t changed a lot and most of my time is spent trying to
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Mike: get those things done, so that’s more of the challenge, it’s not trying to figure out what to do, it’s figuring out what order to do it in and how to get it out as quickly as possible without wrecking things along the way because like you said, there’s that issue where if you go to roll out a new feature or a new piece of the code, if it touches a bunch of different pieces of the application and you don’t have as many unit test around it as you would like than it’s a little scary to hit that deploy button. So most of the time what I do is I deploy it out to my development server and I just try to beat on it a little bit to see like can I break this or is there any obvious things that I might have missed that may not be covered by unit tests because the front of the UI, like there’s very little unit tests are on the front end stuff, like the services and all of the back end stuff, like there is unit tests there but the front end is not tested well but that’s also because I know that the front end is changing a lot, so it’s much harder to put something in place where I’m just going to have to change all of those things anyway.
Rob: Right, and
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Rob: you know the front end unit testing, which I guess now becomes what integration or system testing, there’s like a different name for it when you’re going all the way from the top down, that’s stuff runs super slow right and I consider it a more advanced method of testing, not a bad thing to have for some critical paths, I think it’s just my opinion, others may disagree with me but it’s like your sign up flow yeah you should probably have, it would be nice to have a nice UI test for that and maybe sending a broadcast in the sense of marketing, I mean it’s your basically fundamental things but A I would not be testing settings pages or like little corners of the apple out that people don’t use and I’ve heard of folks who separate those front end tests that hit that UI into a completely different test sweep because they can take 30 minutes to run or an hour to run, because they are so slow because they have to speed up browser instances and click on things. So, I don’t know, I would say at this point you will be better off annually QA your stuff and then just having unit tests below the surface, that’s probably what I would have. I don’t think I would spend a bunch of time doing UI tests yet. I actually don’t think the UI
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Rob: testing suites are that still, they’re still not that great.
Mike: Oh, they’re terrible.
Rob: I know, I was using Selenium in 2008 maybe, 2007 to 2009 in there to test on an invoice and it was horrendous and I’ve heard there’s like another layer now built on top of Selenium and I heard it’s still not that great.
Mike: Yeah, I poked around it a little bit but realized that there was just too many things changes to really make any sort of difference and it wasn’t worth going down that road. I mean the API and stuff gets tested and some of the different layers but you know once it’s passed that, I mean the front end of the app, it’s all this massive Java script application because it’s all written in angular so there’s not much there other than the smoke tests in that if I make a change on the front end UI I can be reasonably assured that the APIs and stuff underneath are working but that’s no guarantee that if you click on a button it’s still going to do what it’s supposed to do.
Rob: Sure, and that’s where I think about having code that doesn’t have a bunch of side effects on it or places on it so if you’re working in a
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Rob: certain part of code you know that you don’t have to go test all of these other things right, that you can test this 1 thing and be fairly confident that you’re not going to break something in the UI and do a cursory test as you deploy it and then just let your customer finds your bugs, no I’m only kidding. That’s like the worst, some of our competitors do that and it has tarnished their reputation.
Mike: Yeah if I can find and fix a bug before the customer ever sees it or knows that it was an issue than that’s the probably ideal scenario but it’s still hard, I mean I’m just constrained on resources and time and speaking of time, things have gotten even worse for me because as of 3 days ago my wife acquired a larger fitness studio here in town, so commence schedule craziness at this point. It’s just her schedule is all over the place and obviously, mine is pretty swamped as it is, so just kind of trying to overlap enough so that we make sure that the kids are taking care of and dinner is ready and all of the other stuff that needs to be taken care of
[00:19:00]
Mike: is done and out of the way is really been super challenging in the past couple of days.
Rob: 2 people running business in the house, that is tough. I can imagine that is really complicated and having flexible schedules sounds great until you realize that like 2 people with flexible schedules is chaos, like Sherry and I have run into that in the past where it’s like I think I have a flexible scheduled but like you said, you actually have kids and you have like some other responsibilities to get kids picked up and get dinner made and this kind of stuff, so I totally get it.
Mike: Plus our youngest was sick yesterday, so it was either yesterday or the day before, 1 of the days this week he ended up staying home from school and then last night he had a fever and we thought he was going to be home again from school today and it turned out he was fine, but it’s hard to juggle all of that stuff and then plus with her new business, I mean it’s a larger business so she’s got multiple contractors that she didn’t have before and there are scheduling issues, and moving to a new space
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Mike: and new software and all of this other stuff that goes with it, it’s a pretty large learning curve is what it comes down too.
Rob: Yeah, I bet man. Well good for her, big congratulations to the both you I guess for her acquiring that studio, sounds kind of cool. I bet that’s a good move for her to kind of up her game, she’s leveling up, stair stepping up if you will, boom.
Mike: yeah.
Rob: how involved are you in her business?
Mike: You know I help look at the business financials and stuff early on but beyond that stuff and just kind of verifying hey is this a good move to make, I really try to kind of stay out of it. Just kind of point out here’s something that you might run into or here’s something else that could be an issue or just don’t worry about this over here, but just kind of try and stay aways from it. I mean that’s kind of her thing so I’m not trying to get in the way, is really what it comes down too, trying to stay out of the way.
Rob: Yeah, that makes a lot of sense. So, speaking of all of the scheduling madness and how to juggle that, Sherry and I made the decision early in the year actually, we were talking to
[00:21:00]
Rob: someone who said they had an au pair and an au pair is someone who is typically young woman who comes from oversees and wants to come to America and is basically like a live in nanny. So, we were talking to someone who had an au pair and said it was life changing and said it was the best decision ever and so I started noodling on it and we realized that we were both going to MicroConf and I was going to be gone for a week or like 6 days and Sherry was going to be gone for like 4 or 5 and every time we go away for overnights A, it’s expensive, really expensive to hire someone to watch your kids overnight and then there’s always they don’t know your routine and they don’t know your house and there’s just so much to communicate that it’s super stressful. So, we’re just like let’s hire a live in nanny, like let’s see if we can find essentially a local au pair, you know, someone who Sherry was like a young college student would be prefect right, and so we did. So, I interviewed, I don’t even know a dozen people here in Minneapolis and right before MicroConf, like the week before she moved in and she lives in, we have like a basement living suite, it has everything except
[00:22:00]
Rob: for a kitchen right, so it has a full bath or a 3 quarter bath and then it has laundry and a bedroom and then we share the kitchen but it has been game changing man and for exactly the reason you said, it’s like sometimes Sherry and I just are 30 minutes off of where we’re not going to be there and the kids are going to be there or sometimes we need to be in 2 places at once or Sherry goes out of town, she went out of town for like 4 or 5 days to Austin for a yoga, some training in aero yoga and it’s like during that time I could handle the kids but they get on the bus at 9 15 in the morning and so that would put me to work at 9 40 and now it’s like you don’t need to be around that much to watch the kids because they’re both in school but I can leave at 8 30 or whatever and someone is just kind of hanging out with them for 45 minutes, so it has been game changing for us.
Mike: Yeah, I can imagine. I mean that’s something that we’re kind of struggling with right now is just trying to manage schedules and it’s just really so early on, but you know hopefully that will straighten itself out but I would love to have a nanny.
Rob: I know, it’s something to think about long term
[00:23:00]
Rob: man, I mean especially 2 people running businesses right, the idea is your schedules are going to be gnarly and in the long run the business should generate a lot of cash, right. I mean it should turn out more money than you would make with a salaried employee and with those 2 things in mind it’s like all right, then we outsource as much as we can and that’s you know, if you’re still mowing your own lawn or snow blowing your own snow I think that honestly, I think that’s not a good use of our time as entrepreneurs. We moved to Minneapolis and 1 of the 1st things that I did, we already had a lawn service but I was thinking like I’m not shoveling walks and it’s not because I’m above it, I used to do it but now the time versus money trade off is insane. So anyway, that’s kind of my soap box about outsourcing stuff and of course I’m not talking about outsourcing someone raising my children of course, I know that’s probably the joke or what folks are thinking, but it is like outsourcing driving them from school to the house, or outsourcing our live in nanny like the kids go to bed at 8 or 8 30 and so she’s hanging out in her room reading and
[00:24:00]
Rob: Sherry and I are like it’s 8 30, we’re just going to go out for 2 hours and like have a late dinner and have drinks and talk and you don’t have to hire somebody, there’s no clock running where you’re paying somebody 15 bucks an hour while you’re sitting down the street at a restaurant. I think that about wraps us up for the day, if you have a question for us call our voice mail number at 1 888 801 9690. No one ever calls us anymore.
Mike: They don’t love us.
Rob: I know, we get like 1 call every 2 months. I tell you what if you want us to answer like go to the top of the queue of questions, just call it in because we get so few of them and they’re fun because you get to hear the person’s voice, you can remain anonymous, you don’t have to say your name or your URL if you don’t want too but it’s kind of nice to get those every now and then. You can also email us questions at questions at startups for the rest of us dot com. Our theme music is an exert from We’re Out of Control by Moot and it’s used under creative comments. Subscribe to us in iTunes by searching for Startups and visit Startups for The Rest of Us dot com for a full transcript of each and every episode.
[00:25:00]
Rob: Although you know what Mike, did you hear that our transcription service again, this is like the 5th 1 we’ve used, they just like disappeared. I know, this happens like probably once a year. I seriously think, we’ll we’ve been doing the podcast for 6 years maybe, 5 or 6.
Mike: Something like that.
Rob: And I literally think we’ve gone through more than a half of dozen of these.
Mike: Are we at 7 now, 7 years?
Rob: Are we? Was it 2010?
Mike: I think so, yeah it was.
Rob: Gosh, dude we are old.
Mike: I know, our podcast is older than most businesses who listen to us.
Rob: Yeah, I know our podcast is older than a lot of children. All right, so anyway transcription service I think Josh, our editor is looking for 1 right now, but it’s just funny how these things just come and go. I guess it’s just such a commodity you know, it’s tough to stand out.
Mike: Well I think that’s the issue with all of them and I think that’s why they come and go because you get the transcriptions and they go for a while and they have a really hard time raising the price because most of them tier their pricing
[00:26:00]
Mike: in terms of how quickly you get it, like oh if you need it in 24 hours this is what it will cost and it’ll be some outrageous number and then it goes down if you don’t need it for like a week or so and that’s the issues is that there’s that race to the bottom in terms of getting it transcribed and I think that most of them just can’t make ends meet and it’s not just because they don’t have enough business but it’s because they’re not able to pay enough for those people and the business just kinds of implodes at some point.
Rob: All right, back to the outro here. Visit Startups for The Rest of Us dot com for a full transcript of each episode. Thank you for listening and we’ll see you next time.
[00:26:36]
Episode 338 | How To Rank #1 for a High-Volume Organic Keyword in Under 3 Months
Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike talk about how to rank number one for a high-volume organic keyword in under 3 months. Based on a case study posted by Moz.com, the guys give their opinions on the eight steps listed in the blog post.
Items mentioned in this episode:
Transcript
Rob: In this episode of Startups for the Rest of Us, Mike and I discuss how to rank number 1 for a high volume organic key word in under 3 months. This is Startups for the Rest of Us, episode 338. Welcome to Startups for the Rest of Us, the podcast that helps developers, designers and entrepreneurs be awesome at building, launching and growing software products, whether you’ve built your 1st product or you’re just thinking about it. I’m Rob.
Mike: And I’m Mike.
Rob: And we’re going to share our experience to help you avoid the same mistakes we made. What’s the word this week, sir?
Mike: Well, I’m spending most of my time these days working on support issues and as I on board people more often, what I’m finding more often is that there’s certain usability issues that keep coming up and I have to keep going back and either help people get through them and then go see what it takes to fix them or just kind of implement the work arounds for them. Then on the other side of it is fixing some outright bugs that I found, which were not obvious. Most of them are just little things like
[00:01:00]
Mike: sorting issues or stuff like that that’s just affecting the UI, but it’s going pretty well so far. Kind of exciting I guess.
Rob: Yeah. There’s 2 sides to this, right? It’s like, on the 1 hand, you don’t want to be spending time working on this stuff and trying to work out kinks and improving usability and all that stuff because you just wish it was done. But on the flip side, you know that these are problems that, at scale, are going to be even worse, right? At 50, 100 or 1,000 users, you need to fix them now. There’s that needing to invest the time, but also it feeling really productive, you know? I don’t know. Like you’re ironing out the rough burs, the rough edges of the product and just smoothing it out over time. I think that this is where you want to be, right? You don’t want to be where you were whatever, 6 months ago and you have 0 customers and is there people using it? It’s like, you don’t know what you should be working on technically. You know? You’re kind of flailing around and it’s like, now there’s people using it and it’s probably pretty obvious what you should be fixing at what point in time.
[00:02:00]
Mike: Yeah. As you quoted, like the rough edges. That’s kind of what I’m spending part of my time on and then figuring out how to fix it. It’s 1 thing to know what is busted and where you need to spend your time, but it’s another to figure out how to do it, so that it’s clearer. Obviously, you wouldn’t design a product that you thought was confusing, but at the same time, when other people get in there and use it, they weren’t inside your head when you designed it. They don’t have the same perspective.
Rob: On my end, this actually is a pretty good week for us. We turned the corner on some scaling challenges that we’d been working on for well, I mean we’ve been working on them for years. You know? They just come back every 6 months. You get just enough ahead of them that you scale up again and then they rear their ugly head. Every time we, I don’t know. Maybe it’s 2 to 3 X, the user base, we see stuff again. In the early days like, well just add an index to the database or add more hardware. But you hit a point where you kind of start exceeding the physical bounds of a single database. You know? You’ll
[00:03:00]
Rob: get a quarter or a half terabyte of RAM and disc IOPS through the roof and it’s expensive. You still just, it isn’t making enough of a difference. We’ve had to circle back and we attack it from a bunch of different directions. We’ve re architected some things. We’ve actually piped some new relic stuff that allows us to really see some detailed traces and we’re seeing, you know? There are some query issues, but there’s also code issues that creep in as you write more stuff where you’re doing N plus 1 queries, in essence. So, we’ve just started to see those creep in and as we’ve been pulling them out, we’re seeing these incremental bumps. We’ve pushed like, 3 or 4 developers pushed 7 different performance improvements over the past maybe, there was a week where we did 7. Then this week, we’ve probably done 3 or 4. It just little by little, it is just making the throughput so much higher, so much faster. We’re sending between 2 and 4 times the volume of email right now than we were even 3 or 4 weeks ago. It’s pretty crazy when you think about it that way. It was
[00:04:00]
Rob: a bit of work to get there, but once this stuff started rolling, it really made a big difference.
Mike: Yeah, it’s funny you mention performance improvements and that. I just rolled one out this week where people can go through and they can identify who has sent them emails and who they’ve received emails from and how many of those in each direction. There was a performance issue earlier where it was just a little bit slower than it should have been and it wasn’t returning all results because there were so many. Just pushed out a fix this week where it’s lightning fast now. It’s amazing how much better the experience of the app is just from those little improvements.
Rob: Yeah. It’s super cool. Sometimes it’s noticeable by users and other times it’s not, but you know that even if users aren’t noticing yet that it’s eventually going to catch up with you. It’s nice to get that done. I remember the days where we’d have a customer with 3 or 400,000 emails in their account. They’d do a big send and we’d be like, man we can totally handle this, but as long as another big sender doesn’t send at the same time. Now it’s just common place. I mean, for 3 lists of 3 to
[00:05:00]
Rob: 500,000 to send within minutes of each other. We’ve gotten to the point now where it’s like, we can hammer through that stuff. It really is just like climbing that mountain and doing things that you never think you’re going to have to do. Denormalizing databases, starting to shard things. Right now considering stripping a table out and literally putting it into a different kind of data store. I mean, just crazy stuff you would never architect from the start when you’re building an app. It would be gold plating when you don’t have any users, but when you do hit scale and you have tens of thousands of people using your app, it is necessary.
Mike: Yeah. I was talking to somebody. I think it was Help Scout at Micro Conf and he was asking me about how some of the back end stuff of Blue Tick was done and I didn’t tell him because it just didn’t occur to me, but the back end data store for the mail, I rewrote it 4 times over the course of 8 months just because it needed to go bigger and faster and it just wasn’t doing it at the time.
Rob: Yeah. It’s crazy how the stuff that you need to do in order to make it work from an engineering prospective, you wouldn’t ever want to do because you’re like, I want to have referential integrity on these things. At some point, you realize that
[00:06:00]
Rob: speed trumps that.
Mike: Yeah. We interviewed a [UNKNOWN] architect this week. We have an open position for that right now to just help handle this because we’re trying to build the product and it just really is a completely separate discipline of being able to scale things to this level. One thing he brought up, which I hadn’t heard of, but as soon as he said it, it made sense. He brought up CAP theorem. C A P. C is consistency. A is availability and P is performance and you get to pick 2. He said, in most databases or most apps, you go for C and P and your availability is 99 point whatever percent and it’s fine because if you were to go down for like, an hour, it’s not catastrophic. But if you pick the other 2, it’s just trade offs, but he said at a certain point, once you scale, there’s a bunch of big companies in town, like Target and Best Buy who run these massive e commerce sites and he was saying once you scale one of those sites, you have to give up some consistency. You have to have availability because it’s millions of dollars per hour and you have to have performance because obviously being slow is costing money.
[00:07:00]
Mike: So, you give up consistency and you have to dealing with that. You have to start writing code and you have to start thinking about what happens when it all doesn’t sync up? There isn’t referential integrity in this certain instance and data consistency in the reports are just not going to be exactly matched across everything. It’s pretty fascinating. Today we’re going to talk about how to rank number 1 for high volume organic key word under 3 months and this is based on an article on moz.com, actually on their blog. It’s a case study that Pipe Drive co wrote with Moz and it was the former Director of Content Marketing at Pipe Drive is where the case study took place. This article is detailed. It’s very long. We actually won’t be able to cover in depth every step, but there are 8 steps that they talk about and we, at a minimum will cover the 8 steps and then go into as much detail as we can, given the time constraints. Then you, of course can come to the show notes at startupsfortherestofus.com. This is episode 338 and click on the link if you want to read the entire article. This thing,
[00:08:00]
Mike: I didn’t do a word count, but it’s got to be like 4 or 5,000 words. Pretty cool. The article starts by outlining the 8 steps and we’ll go through those 1 at a time. They talk about how much more difficult SEO has gotten and that SEO these days is much more about content and content marketing, whereas it used to be more about just straight up link building and it was a lot easier to game and Google has done a really good job of essentially closing those loopholes, much to the chagrin of a lot of marketers I know. Let’s dive right in with these 8 steps. They basically said they got a top search engine ranking position, which is a SERP spot. It was a focus of a 3 person team for a better part of 3 months to get this. It’s pretty crazy. They invested a lot of energy in it. Step 1 is to find a good topic, one that has significant key word volume and he goes right into the Google key word planner where he said when they ran the search, they picked a key word with 9,900 searches per month and we’ll go into why that’s enough later on. Now, the key word planner doesn’t even get you that close. It gives
[00:09:00]
Mike: you like, 1 to 10 K range, which is like, horrendously helpful. He said the same key word, how to search volume of 1 point 7 to 2 point 9 K in the Moz key word explorer in case you have a Moz account. They give you tools to help do this kind of stuff to help rank for key words. He looked at a chart that Moz had published and they said that if you ranked 1st for a term, you’re likely to get, it was like 30 or 32 percent of the clicks. If you rank 2nd, it’s about 14 percent and if you’re a 3rd, it’s about 10 percent. They figured that if they can rank 1st for this 9,900 search term, they would get around 3,000 visitors a month for a top position. If they could convert 5 percent into leads, which I’m assuming they are trying to email capture. I’m assuming they’re thinking about that. That would net them 1,800 leads a year, which they said it would justify the time. That’s kind of the 1st part of the 1st step of finding a good topic, is to make sure there’s enough volume that if you rank 1st,
[00:10:00]
Mike: given whatever it is you’re email capturing or trial rate or whatever it is you think you can do that it’s going to be justified time wise and financially.
Rob: I think the thing I take away from this, in selecting the right topic is more about doing the back of the envelope calculations to figure out what you should be going after based on what your return on that is going to be and it’s not so much about a specific raw number that you’re going for in terms of the search volume. It’s more about how many of those people you can convert to leads because if you’re conversion rate is higher than other peoples based on your content, then target search terms that have lower search volume because they’re going to be worth just as much or more to you than they would be to somebody else, assuming that you can convert them better. I kind of like that idea of starting from this side of it and not focus in solely on, what should we focus on for content or what should our ad line be or anything like that? It’s really about what your ROI is going to be on that.
Mike: Continuing with step 1, which was finding a good topic, the 2nd thing they looked at was to pick a winnable topic. This is actually where Moz is really handy. They said for example, if you’re trying for content marketing,
[00:11:00]
Mike: the 1st page is dominated by the Content Marketing Institute and they have a domain authority of 84 and that is very high. It’s a scale of 1 to 100. What they did is they looked at Moz Bar, which is just like a Chrome plug in and you can check domain authority and page authority on the fly. It overlays them in Google. There’s a screen shot of it here in the post. They looked at a bunch of different key words that had search volumes between, I think it was like, at least 3 to 10,000. That’s kind of where they were thinking. They were searching for like, sales management. They were using page authorities in the 30’s and 40’s. Domain authorities, there was 40’s, 70’s, 30’s and 20’s. Given that some of these 20’s and 30’s, they knew that they could kind of get in and then they used Moz key word explorer to look at the actual difficulty versus the potential scores. Then they kind of outlined some loose ranges. You want your opportunity to be above 50 and your potential to be above a certain amount. There’s obviously a bunch of different ways to do this. I have always used Moz for
[00:12:00]
Mike: this kind of stuff. I know there are other tools that do it, but their data is solid and they’ve been around a long time. At this point, they wound up with 4 key words. Sales techniques, sales process, sales management and sales forecast. One of them has 4,400 searches and then it goes up to in the 8’s and 9,000’s and they said any of the above would work for them, but for added impact, they added a 3rd and final filter to help them pick the key word and that is strategic relevance. If you’re going to turn your visitors into leads, they say it’s important to focus on key words that are strategically relevant to your conversion goals, and in their case, sales management is the optimal key word because Pipe Drive is a sales management tool. It described them perfectly. In contrast, sales techniques and sales forecast are key words a salesperson would search for, not a sales leader or a small business owner who would be a decision maker to decide to buy Pipe Drive. It’s pretty in depth here, but it’s something to think about, right? If you see a key word with low difficulty and high search throughput you think you can rank for, it may not actually
[00:13:00]
Mike: be that helpful, right? If it’s not strategically relevant to your business.
Rob: I like the fact that they point out in the article that you’re looking for a competitive score of under 50 and a potential or opportunity score of above 50. I don’t know if that side of it is so important to me or at least it wasn’t when I started out, but knowing that under a score of 50 for difficulty is a lot easier to rank for and it is possible to get it than going over that. I mean, even trying for things that are in the 50’s or 60’s, those can be very, very difficult to get, especially if you’re going against certain types of companies, trying to rank against them for those terms can be really, really hard, but anything below 50 is not actually all that difficult to do, especially if you are kind of limited in the amount of time that you can spend on it in your budget, those things are definitely attainable for the average person.
Mike: Step 2 is to write a bad ass piece of content. That’s the words they use in the article. Theirs is broken up into multiple parts. The 1st is extremely thorough research of the
[00:14:00]
Mike: existing ones that rank in the top and they kind of look through them and figured out what works, what doesn’t, what are they like both from a reader’s perspective and with an SEO eye in mind? When the pages had way too many headlines, it was over key word stuffed, basically. Then they looked for anomalies and 1 thing that caught their eye was 2 of the top 10 results were dedicated to the key word sales manager, so they realized all right, we know that we’re going to want to talk about at least sales managers in our article. Then this was 1 I hadn’t seen before. I went all the way down to the bottom of the SERPs and there’s a related searches thing that Google puts there. They looked through for those terms and they realized we probably want to include some of these in there. Part 2 of this, of writing the piece of content is the actual content creation. They say you don’t need to be a subject matter expert, but if you do a lot of research, you can put something together and they go through some steps on how to write, I don’t think it’s super relevant here, but it’s like, don’t multitask and work alone and put on some play lists and such.
[00:15:00]
Mike: Personally, I like Spotify’s Deep Focus. They have a different one. Then they talk about going through and adding images and adding headers, subsections and all that. That really caps out step 2. As I said, they go into more detail, but it’s almost like its own little article on just how to write a decent piece of content.
Rob: Yeah. The 1 piece that I took away from this is paying attention to the part at the bottom where it says, searches related to, in this case, it was sales management and you can use those for kind of off shoots. If you want to create dedicated pages for each of those. In this case, they’ve got objectives of sales management and sales management PDFs. Those are the types of things you could target as a secondary page with a different article and trying to drive related traffic to those pages as well. I think that’s a perfectly vital strategy, especially when it comes to things like where people are searching for PDFs and you can give them a PDF of, like a template or something like that. Lots of people have used that strategy where it’s like they drive people to that page
[00:16:00]
Rob: using SEO because they’re specifically looking for something that they can download. You give it to them in exchange for an email address and that’s one way to drive up the level of your email list.
Mike: Step 3 is to optimize on page SEO and engagement metrics. This is the steps they took to optimize the on page SEO. Number 1 is to fix the title. They wanted traffic from people searching for words related to sales management, such as sales management definition, sales management process, sales management strategies, sales management resources and so, their headline, their title and their H1 tag is Sales Management Definition, Process, Strategies and Resources. So, they covered them all right there in the headline. It says Google is now smart enough to know that a single article can cover multiple related key words. The common [UNKNOWN] to the list, they said should work for them.
Rob: I wonder how long it is before Google realizes that people are key word stuffing into headlines now.
Mike: I know. Well, it’s interesting because if that’s all you’re doing, it’s not going to work. You know? It’s all this other stuff they did that then propels that to work. You know?
[00:17:00]
Mike: It’s writing this massive piece of content, spending months doing all this optimization. So, part 2 of that is to fix section headings. One example is instead of writing Sales Management Definition as a header, they actually wrote the header as, it’s a sub heading, but it is, So, What is Sales Management, question mark. It’s an actual question a reader might ask. 1, it makes the article easier and better to read, but 2, it’s a natural question, which makes it more likely to rank for voice searches and for Google’s answer. This is good stuff. They also peppered related key words in the headers throughout the article. Later on, they realize they key word stuffed, basically. They actually go back and roll this back a bit. Then the 3rd step was to improve content engagement, like they have colons and line breaks and internal links and outgoing links. They just make things kind of easier to skim and easier to read. The 4th thing, I had heard this as kind of a rumor that this might exist in the Google algorithm, is to shorten the URL. There’s this graph they include where the longer your URL,
[00:18:00]
Mike: the less likely you are to rank for number 1. It’s fascinating. They have these really long blog URLs. They just shorten this way down. They essentially just have sales dash management, aside from the date in the URL. Then they improve the key word density. Obviously including the key word in the 1st hundred words of your content is kind of a well known thing, but then they talk about going through it and adding a glossary at the bottom, so they can include a few more key words. They do point out how important it is to make these as organic as possible because otherwise, it looks and feels like key word stuffing and Google and users are pretty smart about this stuff. They said, as a result of the on page key word optimization that their traffic went up and they have a screen shot of 19,000 page views. As they say, we over optimize key word density in the beginning, which slightly hurt rankings, but once we stopped this, we changed things around and saw an immediate improvement. We’ll get to that in a step or 2 later. They don’t show that 19,000 page views, they don’t show what the time frame is on that, but they did indicate
[00:19:00]
Mike: that this definitely had a positive impact on the post.
Rob: You know, I do wonder if adding, what is blank and adding in the key word is something that Google specifically looks for. The reason I think that is, or at least I kind of have an inkling of that is when I was doing Audit Shark, I had a bunch of pages that said, what is blank. So, for example, what is compliance management and if you would look around for compliance just in general, then that’s a very difficult thing to rank for just because there is all these different compliance institutions and it’s government regulations and it’s really difficult to rank against those, but if you go out and search for, what is compliance management, Audit Shark’s website actually ranks higher than the fdic.gov website for, what is compliance management system.
Mike: That’s crazy. Should you sell that? You should sell it to the FDIC. Hey guys. I have this site that ranks above you.
Rob: Right. But I wonder if that is something that specifically Google looks for. What is blank and whatever that key word is.
[00:20:00]
Mike: Yep. Totally. I would totally imagine that’s part of it, I think. More and more of these voice searches are happening in the Google answer stuff. I think it’s become more common for people to search like that as it has worked better. So, step 4 is to build internal links to the article and that means linking to this article from other articles that you have. It talks about how Google bot discovers your content by crawling your links and it also tells Google that this page is important if a lot of your pages link to it. You don’t want to just put a link in a header or footer. You actually want to link from individual pages in your site and kind of pick the right key words to link through. You look for high traffic. You look for high page authority and then they have a kind of site colon search you can do on your own website to find these key words that you want to use that appear in your other posts. You can link them out. This gives you just that basis of page authority on this new article.
[00:21:00]
Mike: Step 5 is stepping out and finding external link targets, meaning external links that will target you.
Rob: So, just to kind of clarify what Robert said, this is a little bit different than putting a footer on your website and having pages that you basically put a site map in place. This is specifically looking through your site where you refer to these terms whether it’s in your blog posts or in different articles or white paper pages, point those back to the page that you’re trying to rank for. It’s very slightly different, but it kind of achieves the same thing. It gets those internal links back and forth inside of your website.
Mike: And as I said, step 5 is finding external websites to link to this new article and they outline using open site explorer, which is a Moz thing, I think. They allow you to crawl the top 10 search results for this term and look at those back links. They dug through a few pages of that, built up a list of a few hundred prospect websites they thought might link to it and it’s a very raw list. Then they
[00:22:00]
Mike: only look at domain authority above 30. They eliminated sites that are free hosts, like BlogSpot and wordpress.com and put it in an Excel file. Then they go through finding the email addresses for people on these sites. They used Email Hunter, which is at hunter.io and they did their outreach. They don’t go through specifically what text they use or whatever. This is kind of a slog, right? It’s called outreach and I’m sure that most people, because I get these emails and I just delete them. But I think if you have a compelling case, apparently whether it’s the Pipe Drive name or whether it’s their approach, they said they just outreached like crazy. They used tools like, you could use one of these tools like Mix Max or Lead IQ or Tout, Perspectify. I suppose you could use Blue Tick as well. DO you allow outreach like this?
Rob: Yeah, it is because it’s going out through your own email server, so you could use that. I was actually going to recommend Links Spy, which is linksspy.com from Christoph Engelhard, who has [UNKNOWN] several times and been our scribe on a number of occasions and taken copious notes.
[00:23:00]
Rob: So, I would probably point to that instead.
Mike: Instead of open site explorer, right? Because Links Spy views your competitor’s back links.
Rob: Yes, it does. You could use it in conjunction with it as well, but Link Spy also has the built in capabilities to reach out to people who have those other sites, so you could use it to do that outreach step.
Mike: Yep. I’m glad you pointed that out. I remember him building that in. I think he has like, boiler plate templates and everything to make it super simple.
Rob: Yep. All the templates and stuff are there already.
Mike: Awesome. This whole outreach step, I’m actually going to skip. I’m going to say you can look at it if you like or you should just go use linksspy.com. That’s links with an S at the end, and then another S for spy. Step 7 of 8 is, they say be prepared to guest post. Guest posting and then when you guest post, you can link back to, within the content of your guest post you can link back to this article. I was doing a ton of guest posting with the aid of the growth marketer, Zack that I’d hired at Drip and it was doing stuff for us. It was sending traffic.
[00:24:00]
Mike: Traffic that converted. It was also building up some SEO juice in our blog and guest posting is most certainly not dead. I know at one point, Google said they were going to start penalizing guest posters, but high quality posts on high quality domains, we have never seen any negative repercussions from all of that.
Rob: Yeah. I’m not sure how they would really find out, other than a manual review that it was done by somebody else. It just seems kind of crazy. I mean, don’t get me wrong. Google has got some really smart people that are way smarter than I am.
Mike: Nice.
Rob: Yeah. I don’t know how you would do that at scale.
Mike: I think it’s like byline stuff, right? You can say, this post was written by blah or this was a guest article, this was a guest post. There tends to be certain phrases that are used. They use machine learning. They’re like, translating languages to hundreds of crazy, exotic other languages. I feel like this is a pretty solvable problem using technology like that.
[00:25:00]
Rob: All right. Well, let’s leave our idiocy in the dust and go on to step 8.
Mike: Totally. The 8th and final step is something I’d never heard of. They say fine tuning content with TF IDF. TF dash IDF, and it is Term Frequency dash Inverse Document Frequency. I won’t really go into what that means here, but basically it’s a way to analyze a document to figure out, what are the important terms based on how many times they’re used and in what context. They just simply counted up the number of times that sales management occurred in their article. They said it occurred 48 times and their article was 2,500 words and they thought that was just way too much. They hypothesized that they were actually being, not penalized, but they weren’t ranking as high as they should because they looked like they were key word stuffing. They backed it off to 20 and they replaced it with terms that have high lexical relevance to sales management, but were not the exact phrase, sales management. They said that it
[00:26:00]
Mike: bumped them up. Their organic page views went from 0 when they started, to over 5,000 in just over 8 months. So, they ranked number 1 for the term in 3, I guess based on the headline of the article and then got these 5,000 recurring page views in 8 months.
Rob: I think if you’re trying to be objective about this, it’s a little difficult to take every single piece of this at face value when it walks through and says this is what we did and this is exactly what happened because there’s so many factors that come into play. Over the course of 8 months, there’s a lot of different things that can happen. Even though they backed off the number of times that sales management came in to the article at a certain time and yes, the search volume went up after that, but it is hard to say that’s exactly why because if you look at the graph that they show, it went up for 2 months and then it went down. Then it kind of meandered a little bit and then it went back up. You know? Over that time period, lots of different things can happen and a lot of them are just
[00:27:00]
Rob: completely out of your control. You don’t have any control over the rest of the internet. It’s hard to say definitively like, hey we did X and Y happened, but there’s certainly correlations that you can make between them to say this is the general direction that we wanted things to go. These are the things we did and yes, it went that way. But you can’t put a velocity on those things or a hard metric on every single one of these things.
Mike: Yeah. I mean, that’s SEO. That’s been organic SEO since it became a thing. It’s gotten a lot harder over time. It used to be easier to gain, but you’re right. There is no way to know that this specific change actually did this or was it just coincidentally just something else? You know? So much of it is correlation and if you do it enough times and you can say I’m confident that it’s causation until Google does their next update. But yeah, you’re never going to know for sure, which is tough. That said, there are these best practices. I mean, there’s a lot of things in this article as I read through that I thought yes, that’s what I would do. That’s what I would do. Then there were a bunch of things that were, I kind of called them out. I was like,
[00:28:00]
Mike: I hadn’t heard this, but this must be kind of a newer thing. I haven’t been knee deep in SEO for, I mean it was 2 or 3 years ago. I was doing it for Drip. It was a couple years before that, I did it for Hit Tail and I tend to do it in little bursts of, I get up to speed and do it, make a bunch of decisions and then kind of move away and work on the product, but people like this who are literally doing it full time, they’re going to always have, doing so many experiments that they’re going to be kind of at the bleeding edge of these tactics. I think there’s something to be said here, like yeah. You could game Google and you could try to get a piece of crap article up to the top of the results, but it’s like, I’ve always felt like we should all be trying to make the internet a better place. Even when I have used SEO and I’ve optimized to get there, I always thought my content was amazing. Like, it was really high quality content. I would either write it myself or pay a lot of money to have a good writer do it. I feel like if you’re trying to push crap to the top of the results, don’t bother. Don’t do it. It actually makes us all, it makes the results crappy, right?
[00:29:00]
Mike: Then it makes the internet a worse place to be. I guess that’s kind of my recommendation. There’s certain people that say you shouldn’t do SEO at all because it just pollutes the internet and I believe that you can do SEO, but in an ethical and high quality way.
Rob: Yeah. That’s not really any different than how some people view marketing. I don’t want to do marketing because it feels sleazy or I don’t want to do sales because it feels scummy and SEO is exactly the same way. I mean, you kind of have to do some level of marketing in order to get your product out there. There’s wrong ways to do it and there’s right ways to do it. This article outlines a mechanism that works so long as you have content that is appropriate to be promoted. That’s it. I think we’ll wrap it up today. If you have a question for us, you can call it into our voicemail number at 1 888 801 9690 or you can email it to us at questions@startupsfortherestofus.com. Our theme music is an excerpt of We’re out of Control, by Moot used under creative comments. 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.
[00:30:05]
