Episode Transcript
Speaker 0 00:00 <inaudible> welcome to the rogue startups podcast. We're two start up. Founders are sharing lessons learned and pitfalls to avoid in their online businesses. And now here's Dave and Craig.
Speaker 1 00:21 All right. Welcome to episode one 85 of rogue startups. Mr. Craig,
Speaker 2 00:28 how are you? This fine week. I am doing well this fine week. Uh, I've been spent kind of a whirlwind the last few days or a week or so, and I had a, I had to put our recording time off for a couple of days and those kind of stuff. We've had some family in town, uh, visiting for vacation. Um, so it's nice to, today was my first really, really intense full day of work in a while. So it is a nice to get back to the swing of things, but I'm a pretty fried. Yeah. So this might be an interesting episode. Yeah, I like interesting episodes. Yeah. Yeah. But it was really nice. We, uh, yeah, we spent the last, we're in Italy right now, uh, in Parma and we spent the last two and a half weeks with all of our kind of direct family in different parts of Italy.
Speaker 2 01:24 Everybody has come over very graciously to visit us here. And we've been in Tuscany and in Verona and in Venice, uh, and just got here to Parma last night. So it's been, uh, a ton of really wonderful food and I am fat, so it's kind of wonderful. Would this be the Pharma of Parmesan Fan? Parma Ham, which is the better part of the two? Yeah. I've never had Parma Ham. Oh Man. It's, it's other worldly. Yeah. I Dunno if you can get it in the states, but yeah, it's really amazing. No, I don't, well, I certainly have never seen it in a specialty food store, but you know, Parmesan around here's a diamond dozen, so. Wow. Okay. Yeah, I'm intrigued now. Parma. Parma. Yeah. Yeah, it's really good. So Parma Ham is a like, dried, aged, really wonderful stuff. Yeah, that's great. Nice. Nice. Yup. Yup. So how about you heard thanks.
Speaker 1 02:23 Things are a little bit wild, you know, I don't have a better word for it than that. We've got a bunch of stuff going on with, with the kids, with back to school. So it seems like every other fucking night we're going to, you know, get to know your teachers this and back to school that and here's a tour of this and here's a presentation from this principal. And our kids are across two different schools. So that doesn't really help cause that bread basically doubles everything. When you have three kids, it triples everything. But sometimes you can like, you know, skip certain things like our high schooler has now said, you don't need to to back to school night for me. And were like, yeah, you're right. We've seen your grades. It's fine. Right? We're not gonna, we're not going there. If there's a problem we'll go, but we're not going now.
Speaker 1 03:07 We just had to, like, there was just too much going on. So, but, but you know, we have, cause my kids, uh, you know, my middle daughter is dyslexic and has ADHD, so we've got an IEP for her. And so we have to have all these extra meetings about making sure that the new people understand what she's supposed to be getting and you know, understand there's definitely new people at the school, so we don't know like how much they know about the school's culture and the support structure and all of this stuff. So it's a little frustrating to deal with all that personal stuff. Uh, but on top of all that, I am actively trying to get the fuck out of consulting right now. So I am looking hard and I can't talk a lot about what I am looking at right now for an opportunity. But if it pans out, it will be really interesting. And that's unfortunately all I can say about it at the moment. Hmm.
Speaker 2 04:08 Interesting. Still in consulting or like doing product work? Uh, it's like for as, as an employee or what?
Speaker 1 04:16 This would be something entirely different and I can't talk about it yet. If it, if it falls through, I'll talk all about it. But if it, if it goes through all, so talk all about it. So, but right now we're in the, we're in the middle of it and I gotta keep my mouth shut, so. Okay. Yeah. All right. I'll ask you after we stopped recording that that's, yes. That's the son of a bitch for everybody listening right now. Sorry everybody. Sorry. It'll be a good story once a once. I can actually either way. Right. A couple of weeks. Nice. So how are things with the Biz? Yeah, man,
Speaker 2 04:57 I, you know, I have like one thing relating I wanted to talk about this week, uh, which has been like hiring and onboarding senior level talent. Um, so I touched on this a few weeks ago. We hired a salesperson for podcast motor, right. Uh, and we also hired a marketer, uh, for Costos and both of those people started in the last, say, three weeks. And, uh, it has been a wonderful experience. Um, generally I'm pretty much entirely out of like the implementation mode of both businesses, but it comes with a lot of like emotional, uh, changes. Um, like I feel like I'm a little disconnected, which generally is cool. Um, but, but changing the way I think about working has been really interesting. You know, think going from like, okay, I'm going to go in and write this blog post or connect with this person about a guest post or revamp the marketing, uh, or the copy on the site here.
Speaker 2 06:05 Um, or I'm going to take the sales call for podcast motor, or I'm going to do some prospecting, or I'm going to do whatever, um, to saying like, okay, you know, Denise or Chris, you the crystal guy for podcast motor, this is what I think we should do. What do you think? They say? Yup. Or nope. We come up with a game plan and I say, okay, what do you need to go be successful? And they tell me, you know, either I'm good or I need this and I need this and I need this and we work together. Uh, and really I think where my role is kind of going is like enabling them to be successful. That's where I'm trying to ask her. I'm trying to sit at least, which I, you know, now that I'm saying all this out loud, I've been doing it on the product side for a long time.
Speaker 2 06:48 Right? Like I give the as good a scope as I can to our developers so they can go kind of be successful and build the thing that we want to deploy. Um, and now doing that, especially with like really senior level folks on the marketing and sales side, uh, is, is cool. And it's like I'm definitely humbled by how good a job they do and how shitty I am at both of these things. Um, so yeah, it's been a really interesting, a really interesting experience especially to do it twice across two different businesses and, and kind of roles in the same month.
Speaker 1 07:25 Yeah. Senior level talent when you get them on board and they, you know, just are instantly productive and they're asking all the right questions and just diving in there and doing stuff. God, I love that. I just love that. It's so awesome. Like when you're working with junior folks, like you can just tell after you've hired somebody, if they claim that they're senior and they're not doing these things, you know that disconnects there right away. But man, when you hire somebody and you thought that they were lower level and they're already operating at that higher level, that's pretty fucking awesome, I tell Ya.
Speaker 2 07:58 Yeah. Yeah. And you're right. I mean the tell is like in the first day, right in the first day you're bring Chris on, Chris comes on and he says, okay, what's your process for this? We don't have one. What's your process for this? We don't have one. What do you do if this happens? I don't know. I just usually make it up,
Speaker 1 08:13 you know? And so like him coming in and these are like
Speaker 2 08:16 really like business operation kind of questions that we should have. We've been in business for like four and a half years. We should have an answer to all of these things. I don't have answered any of them. Denise comes in and she's like, okay, I need this, this, this and this. And what are you doing about this and this? And I'm like, I don't, you know, I've never even thought about that.
Speaker 1 08:35 And both of them are piled thousands of users and I've never thought about that. Like how is this possible? Um, uh, that's, that's something that I'm always afraid of in hiring senior people is that, you know, you basically you hire them on to help you with all of these things and then you expose yourself in the, you know, in the sense that you say, right, here's all the things
Speaker 2 08:56 I'm looking to work on. And you know, in some sense you've got to be careful because you're basically going to end up looking a little like an idiot and say, I just have no idea what the hell we're doing here. I need you to help me with this. And you know, the fact that they are signing up for that is really cool. But you know, it is kind of freaky to say all those things to them, right? Because you're just afraid that they're going to turn tail and run. <inaudible> yeah. I mean, I, I'm, I tried to make it a pretty clear thing, like in the interview, uh, process especially like later on in the interview process to be like, we are a small team. Uh, this has been my role, you know, cause in both of these situations, that's been like my main role in the company.
Speaker 2 09:36 Um, it's probably not like the thing in the world I'm best at. Um, but it, it is what I've been doing. Um, and so your job is to come in and share it up a lot. Not, you know, these people that we're hiring are not like just the implementers, right? They're the pretty high level conceptual people. Um, and so I've, I've tried to be really humble about it really quickly to say, you are better at this than I am. You certainly will be very quickly. Uh, if you're not on the first day and that's cool. That's why you're here. And I have kind of resigned myself to say like, I am not the person that can do all these things at the level that we need to do them at. Yeah. And that gives them an opportunity to shine. Right? Totally. Yeah. Yeah. That's awesome.
Speaker 2 10:24 Yeah. Yeah. And you know what, something that, uh, it's Kinda made me think about like, uh, maybe we'll add this to our rules of thumb thing that we have a kind of ungraciously borrowed from the startups for the rest of us guys. Um, I have as a rule of thumb around when to hire a marketer now and I think this is pretty universal. Um, we hired a marketer way too late and I think almost everybody does. Uh, even with like having a, a nontechnical founder like me, the rule of thumb I think is you should hire a marketer when your salary is paid. You as the founder. Um, because if you're getting to that point, so say you're making whatever, 10 or 15 grand a month after you pay developers and other, you know, various kind of like other people and it infrastructure expenses and you bring home money, all of the rest of the money should go to growth because the assumption is then like you have product market fit.
Speaker 2 11:22 If you've gotten to that point, the product is good enough, your position in the market is good enough to where you just need to do a lot more butts in chairs. Um, so I don't know, what do you think is that, is that a reasonable rule of thumb? Ah, I'm thinking about that. You know, I mean, so as a founder of two different things that have not reached that level where I'm getting that level of salary out of them, I can't personally talk from experience on it, but it feels like that's a pretty reasonable time. It maybe you should do it earlier. Maybe you should cut back on your salary if that's the case. I mean, at what level? So here's a good question for you. At what level of revenue do you think a product hits product market fit? If you're getting x thousand dollars a month in MRR, you've hit product market fit. What's that number?
Speaker 3 12:17 Hmm,
Speaker 2 12:20 I, yeah.
Speaker 3 12:23 Um,
Speaker 2 12:25 is it 20? Because you know, you subtract out things for other developers and expenses and stuff like that and you're pulling out 10 does that, does that make that number happen? I am hesitating cause I almost think it has to do with like how many months of good growth you have because you could be growing consistently at like a decent rate and not getting the 20,000 for like a long time, you know, or you could be, you know, kind of one of these Cinderellas and get to like a hundred thousand a month in MRR in the first year. I'm like Edgar or something. You know. So like so is it, it's not a number, it's months of growth in a row maybe. Yeah. Like I would maybe say if you've grown 5% or more for the first year every month, then you probably have something you can bank. And this is the feminist is what you're asking is like when can you bank on making an investment in the company?
Speaker 2 13:17 Yeah. And I think if you've done those things in that amount in that time, then then I would feel comfortable saying like, okay, I this, uh, you know, this is somewhere I can, I can reallocate resources or pay myself less to invest in the growth of the business. Yeah. So that's really what I was getting at is at what point can I really feel comfortable in investing in that side of the growth of the business. Yup. Yeah. So that makes more sense. And you would assume that if you hired this marketer or the salesperson, uh, more you should have more revenue, right? Like they should pay for themselves pretty quickly. Yeah. And if they don't, then you either hire the wrong person or you don't quite have the product market fit you think you do. Yup. Yup, Yup. Yeah. Yup. All right. I'll buy that.
Speaker 2 14:03 I'll buy that. Yeah. Cause I was going to paint you into a corner with the whole, you've got to earn 20 k before you got, uh, you know, product market fit or whatever there. Cause there's definitely a lot of cases where that probably isn't the case. But yes, I would agree like solid growth over a period of a year, maybe less, but a year a year gives you a 12 solid fucking data points there. It's hard to argue with those. So yeah. Yeah. That I'd go with because I think there's some apps that are doing decent revenue but maybe aren't growing anymore. And so I would feel really scared about hiring a marketing person into that. Maybe, you know, cause there's some degree of misalignment there. Maybe, you know, maybe if the product, like I can think of a specific
Speaker 1 14:52 product that I was looking at at one point and that was less accounting and they, their growth had plateaued but they had a decent, you know, you could definitely bank on something there. So, you know, if you've hit a plateau and your growth and you need to reenergize the market or you need to find new sources of customers, I still think it would be appropriate to hire a marketer at that point. So, you know, it isn't strictly speaking growth, but do you have basically a means to support somebody to bring them on? So if you're new and you're growing, you have to wait until you've achieved a certain level of growth so you can actually say, hey, you know, I can, I can hire you for this. And maybe it's a contract person. Maybe you're only going to do it for three months and see how it works. I mean I don't, you know, that might be a little short for a marketing person, but maybe the right person could really make something happen there. I Dunno. Yeah. Yup, Yup.
Speaker 1 15:46 So yeah man, it's been, uh, it's been a roller coaster for sure in a really good way but just a lot going on in both businesses with, you know, Chris on the podcast motorcycle, nice on the Casto site, just doing a lot of really good stuff. I'm trying to support them and get out of their way at the same time, which is a cool and new experience. But yeah, it's going good. Very nice. Very nice. The uh, the plugins have been kind of interesting lately cause we did the AWP CP four o release and we have gotten slammed in support. There's always like a two week delay. So if you release on August 1st it's about August 14th when the support requests kind of come in and earnest and everybody finally gets the bravado to upgrade, especially if you've released a few patches in between. Cause we've been doing pretty consistent weekly releases and some emergency stuff for people that had stuff that was really broken.
Speaker 1 16:44 Um, but now we're like the support queue is just buried and you know, I've got poor Bobby asking me about, you know, what's going on with the guys and one of the, when did they going to get stuff fixed? We've got a release tonight. Um, and then, you know, one of my senior developers is leaving at the end of the month, year. Although I've gotten him to agree to, you know, providing uh, an email based support role to the other guy. But I kinda feel like the, the other guy is buried a little bit here and he might be a little out of his depth at the moment. And I'm hoping he steps up on this and if he doesn't then I've got some hard decisions to make here in September and October, which is going to so on. So yeah, I dunno. I Dunno. That's, that's Wayne in the back of my mind right now.
Speaker 1 17:32 And then a, with recapture, you know, things are, things are actually going really well. We're having another good month of growth. So solid fifth month in a row of growth in the, you know, five to 9% range every month. That's awesome. Yeah, that's true. That's been really good. Expansion revenue is the key to that. Now that it's built in, you know, as soon as they hit that spot where their revenue just gets above a certain tier, they automatically bump up. I don't have to ask them, I don't have to convince them. It just does it and nobody's churning because of that specific reason. I'm seeing people churn because they've signed up, they've activated and then they get $53 in the month. It's like, well yeah, spending 29 to recover the carts for that. That's not going to be worth it. Sorry. Right. And I'm seeing those and I've had a few zombies turnout, but other than that, you know, everybody else seems to be reasonably happy with it.
Speaker 1 18:25 Uh, which is good news. And you know, I have like one customer right now that has, uh, Geez, how many stores do they have? So this is a, this is a Hong Kong based thing. And they have, I want to say like 18 to 24 online storefronts that they're doing. There's like four different brands in each of those brands has like six, six or seven individual storefronts. So they'll have like a Canadian one and English one, a French one, you know, um, German one, Spanish one, et Cetera, et cetera. So that's a lot like, you know, that's a significant chunk of my MRR at this point. I mean, not, not like 50% or 25% or anything like that, but I mean it's like if they were to leave, ouch. That would hurt. Yup. Um, so they're just coming up with like all kinds of things. So they've got like several different support people asking us questions they're having like issues with, you know, our analytics over here.
Speaker 1 19:28 We're trying to figure out what's going on and we want to export them and do our own things. And so we have to add that for them. Cause there are big enough customer now like you want to make them happy. Right, right. And so we're like constantly scrambling and then they've got a question on this abandoned cart over here. Why did this happen? And these settings don't seem to be working over here in this weird configuration. What's going on with that? Oh and we want to do custom sender domain on these three domains over here. Can we get that set up? And I'm just like, yes, yes, yes, yes, yes. Yeah. And it's all good. It's just, it's keeping me extraordinarily busy. Uh, you know, and then we get the support requests for regular customers coming on where they're just asking questions, how do the carts work?
Speaker 1 20:04 How do I reprocess cards, you know, do you support x? And then we're trying to find some bandwidth in here to like add in new features like unique coupon codes so that, you know, coupon code can only be used once by this particular person and nobody else. So they can't just share out random coupon codes where people will abuse them over time or whatever. Yup. That's been a commonly requested thing, but you know, we haven't finished that yet, so it's Kinda hard to get that all done. It's not quite, you know, our revenue is not quite at the level where I can dedicate one person to the support questions of one person to features is just one guy that's trying to keep his head above water for all of it. So how do you decide, uh, like when a bug
Speaker 2 20:48 or a feature requests from like this super important client gets prioritized all the way to the top of the queue and Mike stops doing what he's doing?
Speaker 1 20:57 Ah, that's a good question. A lot of the time it is, it's usually the question of is this something that's causing like a data loss or is it, um, you know, if it's crashing the app or it's presenting incorrect information or it's something that's like super critical, like it's braking, abandoned cart flow, like all of those things straight to the top immediately. And then when it comes to other things, if I see, like they were asking recently, hey, you know, we've got 24 freaking stores, we don't want to look log into 24 accounts and download these things to get the reports. How can we get that? So we built in an export function that would basically say you can log into one store for each brand. So that's four different logins and then pull out all of the stuff at once for all of those brands, for all of those sub stores or whatever.
Speaker 1 21:51 So that was something that was kind of on our roadmap for data management, but because they asked for it, I prioritize that like under those previous bugs I just mentioned. Okay. Okay. So that's usually how it goes. Cause I wanna you know, if it's something that they're asking that's like way out in left field, but I'm not getting those, I'll tell you that the people that are at this level in their stores, they're asking for like smart, smart stuff, things that I would have put in the roadmap anyway, things that I've heard of that people request. It's just that they're at a point where they need it now. And so I'm like, yeah, okay, that makes sense. And usually the stuff that they're asking for is also not something that takes like weeks to implement. It's like six to eight hours a lot of it. So it makes their life better. It's something that was on my roadmap. It takes less than two days. I'll probably just bump it to the top just as a customer management sort of thing. They're right. Yeah. Cause it's very much my job to keep them happy at this point. Right. They're
Speaker 2 22:52 at their level. No, I mean if they have, they're a significant part of your revenue. I totally hear you. Yeah. I mean we, we unfortunately don't have that kind of like revenue dynamic where a customer could be a substantial part of our revenue. But we have like influencers that I view kind of like the same way. Like they're responsible for bringing us other customers cause they're just like a thought leader in the space. And yeah, we try to do the same kind of thing to where like if they're like a power user, so they're seeing an edge of the product that other people don't see. Um, if it's like a catastrophic thing, like it's crashing the app or breaking their feet or something like that, we, we fix it like right away. Cause they need their shit to work as they're a power user. And other people will probably see this eventually. But if they're like, you know, hey, we're wanting to do this thing that's like an edge case so we can import data into our custom analytics solution. Uh, yeah. We just tell them, yeah, okay, it's on the roadmap. Um, unless you're going cancel, we, you know, we can't do it right now. And that's the tough thing. It's like, are they going to cancel or do they just want it?
Speaker 1 23:57 Yeah. Yeah. And that's, you know, when I was doing this with the plugins, the way I always sort of separated the wheat from the chaff on that one was just ask them straight up, you know, they'll come and say, hey, I want to, I want the plugin to do x, y, z. And I'm like, Huh, okay. That's interesting. It sounds like something I would put on the roadmap. Um, are you willing to pay for it? You know, shared development costs and you know that usually nine times out of 10 gets them to say, ah, yeah, no, I'll just wait. Which means, you know, it wasn't really that important to them. They just wanted it. They thought it would be cool to have, but it wasn't like the critical must have, oh my God, I can't use this without that feature. I've had people come and say I need this.
Speaker 1 24:40 And I'm like, okay, great. And then I said, you know, this is what it's going to cost to develop that. If you'd like to do this custom work and I'll give you a 50% discount on that because you know, it's something on our roadmap and I want to put it into the core of the plugin. And then you know, when they enthusiastically respond to me at that point. Oh yeah, totally. That I'm definitely on board with that. Then I know how important it is to them because they're actually willing to do for it. But I don't, you know, you don't really do that with Sass because you know, with the plugins, it was always the one time purchase thing in the annual renewals. So you're not really, you know, you're, you're not dealing with that transactional relationship when it comes to somebody who's paying you several hundred dollars a month and they're like, Hey, I want, you know, to be able to export all my CSV files. It's like serious, sir, I'll happily do that for him. Yep. Yep. What color do you want them to be? What color do you want your CSV files in? Exactly. Yeah. Yeah.
Speaker 2 25:33 Um, going back to the, what are you talking about with the plugin in the, the, the release and all that kind of stuff. Uh, do you feel like the, now that you've gotten this major release out, and I know you added another one on the classifieds, um, no, that was <inaudible> on the business directory plugin like last year, something like that. And you feel like you can slow down development resources there sometime in the near future, or is it still requiring you to backfill this guy that's leaving?
Speaker 1 26:03 I'm not backfilling the guy that's leaving. So that's a, that's a given. Um, the idea is definitely, you know, I'm gonna keep adding features and you know, between the two it's clear which of the two plugins is like the bread and butter. It's like a five x difference between them, between classifieds and the business directory. So you know, I put the classifieds one out there but because we took a very long time, you know, I mean the revenue that it was getting at one point has, there are competitors that have come into the space and eaten up some of that market share. So I'm still getting stuff on there but I, I'm not seeing an uptake in plugin that justifies that. So I'm probably gonna back off additional features that go into that plugin now and just kind of keep it into, I don't want to say maintenance mode cause it's like maintenance mode plus we'll add in small features here and there, but I'm not going to go through this major development effort on classifieds for quite some time.
Speaker 1 27:01 Yep. Business Directory. I'm still kind of up in the air about it. The whole block thing didn't really take off and we didn't, we have, you know, zero explicit support for blocks from Gutenberg and business directory and I don't have people knocking down my door saying, why the fuck don't you work with Gutenberg? We are compatible with Gutenberg. If you install us and try to use this in a block, you can put a short code in there and we'll show up. It won't break, but we don't have a block to drop in. So we're not seeing that block uptake. And I know one of my competitors invested a significant amount of time in blocks. So at this point, you know, they're probably like, hm, well fuck yeah. Yeah. So I'm kinda sitting back seeing where that's going. You know, there are definitely some UX UI things that I would like to fix in there.
Speaker 1 27:52 And I flirted with the idea of like hiring a major senior UX person to come in and revamp the front end of the plugin so that it just has a better experience overall. But at the same time I'm like, yeah, that means I've got to manage it and I'm doing these other things and I got plenty of my plate. So yeah, man, I don't see that happening anytime in the near future. So it's probably going to be in feature mode, you know, maintenance mode plus. Yeah, yeah. No that makes sense. That makes sense. I mean I think if it's cash cashflow in you and bankroll and the other stuff and that the time that you're wanting to put into recapture, uh, that's, that's what it's there for. That's great. I think, yeah, I mean recapture is heading in the right direction at this point. So energy is definitely going in there. I would much rather put my time and effort into there and get multiples out on the other side. Cause you know, the plugins in many ways if uh, peaked and, and plateaued there so I can squeeze a little bit out. But you can only, you know, you can't get a second squeeze out of that lemon so to speak. Right. Kim Milk that rock.
Speaker 2 29:00 So I think that wraps us up for this week. This is a one of our shorter episodes, but, but Dave and I wanted to just have kind of an updates episode to say, you know, kind of what we've been working on, checking in on, on the businesses, uh, you know, some personal stuff cause, uh, you know, here in the, in the Twitter sphere and in the microcom fee bootstrappy crowd, you know, that, that a lot of folks really like these kinds of podcasts and this type of episode from us. So, um, but we leave it up to you, our wonderful listeners. Uh, and we would love to hear kind of what you guys think of, of these types of episodes that are just updates and kind of some lessons that we're learning along the way. Um, I guess it is like the tagline and the intro of the, but I know we do some other kinds of formats from time to time, so we'd love to hear what people think, uh, in which goes and gals want more of. Um, so shoot us a message podcast@roguestartups.com. Uh, or just hit us up on Twitter if you would like to, to kind of chime in on, on you know, what you like and what you don't like, and what you'd like to hear more of here with the podcast. Um, as we're getting into the last part of 2019. And as always, thank you very much for listening and if you're enjoying the show, please share it with someone that you think would enjoy it as well. And we'll see you next time.
Speaker 0 30:16 Thanks for listening to another episode of rogue startups. If you haven't already, head over to iTunes and leave a rating and review for the show for show notes from each episode and a few extra resources to help you along your journey. Head over to rogue startups.com to learn more. <inaudible>.
