Episode Transcript
Speaker 0 00:08 Welcome to the rogue startups podcast, where to start up, founders are sharing lessons learned and pitfalls to avoid in their online businesses. And now here's Dave and Craig.
Speaker 1 00:20 All right, welcome to another episode of rogue startups. Today I have the famous Adee Pienaar from woo themes fame, also the founder of public beta, and currently the founder of Conversio who just got acquired by campaign monitor a D. welcome.
Speaker 2 00:42 Thanks Dan. Thanks for having me.
Speaker 1 00:43 I'm very glad to have you here today. So, uh, D and I have known each other for Oh God, years and years at this point. Right. So the first Microcom you were there, you were a speaker. We chatted a little bit then and then reconnected at Shopify like a year ago. And um, yeah, so we've, uh, we've known each other for a while and what's kind of unusual and kind of different about today is that a and I are actually competitors. So you're the first competitor I've ever had on the show, which is funny, but a D is awesome. And for those of you that don't know a D, I would strongly recommend a, and there'll be some stuff in the show notes for links to his blog and things like that. I would strongly recommend that you take some time and get to know him, get to know his products, cause if he is an amazing founders. So a D I'm glad to have you here today. Is there anything you'd like to tell the audience before we jump in here?
Speaker 2 01:43 Well, I'm mostly very grateful for all the very kind of kind words and compliments I'm in. Dave. I, I think though everyone else should, um, just make up their own mind and at least find some <inaudible> right. Just to kind of balance out, you know, we'll leave compliments because otherwise I'm just going to be way too uncomfortable over here.
Speaker 1 02:01 Well I did dig up some dirt on you and I was going to save this for later in the show, but it's kind of hilarious. I'm going to throw it out there now. I found that it was like this weirdo site. So I, I Googled you for a second to see if there was anything that was on the press release for campaign monitor. And what I found was that there's like this Wiki South Africa thing. Did you know that you're one of 10 youngest African billionaires?
Speaker 2 02:26 I have a the Zuber actually, yes. Um, uh, if you, if you find the real me out there in the world, because obviously I'm not that guy. Right. But if you find him, he's actually used my name and he's obviously been in billions, so I'm like, I would just like some kind of royalty, like I eat, he can have some of it. Um, I would just like some kind of royalty,
Speaker 1 02:47 well, they have your picture on the site, which, you know, makes it even weirder. But I was just, I was wondering, you know, what was it like hanging out with Bezos and Gates and, uh, you know, do you have lunch with buffet? Do you take calls from the other billionaires? Do you guys like call each other and say, Hey, you know, how's it going, bill?
Speaker 2 03:03 Yeah, it is basically something like that. Yes. I mean it's, you know, it's very boring as well. You know, we mostly just comp money, um, when we, you know, meet up. Um, so it's not really that interesting.
Speaker 1 03:14 Well, you've totally blown my entire thing about billionaires now. I'm very disappointed at the yeah,
Speaker 2 03:20 yeah. Sorry. Like this, this, this unicorn thing guys. I'm mean, it's, it's not what it's all kind of made out to be.
Speaker 1 03:26 All right. All right, well, all right, so let, let's get into something a little more interesting here. Besides being the 10th youngest billionaire in South Africa. Um, all right, so you, you have been a founder for a very long time. Like what year was WooThemes founded?
Speaker 2 03:43 So I booked the first week themes product end up 2007. Um, and then we officially founded with themes in the following year. So mid 20 a 2008 right?
Speaker 1 03:55 Right. So long, long, long time ago. And you know,
Speaker 2 04:00 especially the incidents years, right? I mean 1212 years intern years time is, is what like 50 normal years,
Speaker 1 04:06 right? In dog years. You're like 178 at this point. Right,
Speaker 2 04:10 exactly. Which means I can't be the youngest or 10 to younger in and you know in Africa like it has to be at least like 20th or something cause I'm old.
Speaker 1 04:19 Well we'll, we'll make sure to correct that with those guys later on. All right, so you've gone through WooThemes you had an exit there, you then turned around and did public beta, which went somewhere and then you decided you were going to move on from that and then you moved on to Conversio. So you've been through a lot of different scenarios here. You've bootstrapped, you funded, you've had companies that were not as successful as your previous ventures. And so then you founded Conversio here. So Conversio has been around since 2014 is that right?
Speaker 2 04:58 Yeah, launched late 2014
Speaker 1 05:01 okay. So you've been doing Conversio for five years. When you and I had a conversation at Shopify, you know, you've got people working for you. Conversio is profitable. What was it that made you want to get acquired this time? Well, you know, you, you were doing okay. Why not just tough it out as a bootstrapper or why not get funding, you know, what, what about acquisition was the right answer for you guys this time?
Speaker 2 05:28 Yeah, that's a really good question cause I think, you know, I think many founders think yeah, when they think about, except, listen, this is I just an extent back to kind of weave stage rights. But the one thing that I learned kind of that stuck with me from the way things XW there's loads of things, but the one thing that is relevant to here was this idea that once you bolt on thing and you sell and you have to start from scratch, you have to do all the hard work, you know, all over again. And yes, like you probably like if I take my situation with themes, yes, I had some of our own capital, which I used to, you know, eventually cell phone commercial. Yes. I had, you know, a reputation. Um, I had network, I had friends, um, I skilled, inexperienced, all of those things obviously helped in the next thing.
Speaker 2 06:12 But <inaudible> getting into that next thing is still hard. Right? So I kind of showed you that after I got into that kind of mindset where an early days conversion, which was let's just build something and run this thing forever and ever. Right. Because I never wanted to have to kind of, you know, start from, from zero, um, you know, with the blank canvas and you don't have to find customers. Cause I think that's the, that's by far the hardest thing to do these days, you know, with any tech business is finding that no initial attention and then, you know, finding enough of it's actually kind of build a business. Right? So that was for I think for the largest part of conversions, you know, five years. That was my mindset. Like this is something that I would, no, I want to work on very, very long term. I think what ultimately kind of changed my mind there was the fact that we had definitely kind of the, you know, the last two years had been tough.
Speaker 2 07:06 We had like, I don't think we had figured out kind of our marketing, for example, we've not figured out kind of our growth challenges. Um, and you know, email January or marketing automation, you know, marketing tech, whatever sector you're going to you or they will label you only use for the sector. It is very competitive as well. So it kind of, I think, you know, I think the choice, I mean I didn't think it's just a binary thing, but the choice kind of was, you know, yes, run this for as long as we can. You're independently and extract as much value from that but then run the risk of, you know, kind of just competition and the, you know, ecosystem ecosystem shifting on us or the market shifting or find a really good home for this. Extract some value, which I think as a founder and entrepreneur diversifies <inaudible> my own financial situation and then essentially use that new home for the product to pursue all the kind of ideas that we had before as well.
Speaker 2 08:07 And I think when, you know, when I think about campaign monitor, at least, you know, they, they took many of those boxes for me, you know, at least in terms of diversifying. I said my diversify my, my own kind of financial situation and give them as a really great home to, you know, say we built this thing, the social part that works and the significant scary thing that our for a big company like compare monitor to one to acquire it, but how do we pour, you know, kind of more, more fuel on these flames now. So that's, I think that's broadly kind of, you know, the the, the way kind of what made up my mind in the end and just kind of how that also kind of shifted from, you know, both from with themes, um, and the start to, you know, of conversion to towards the natural stages and exciting.
Speaker 3 08:52 Yeah, I totally hear you on the whole landscape
Speaker 1 08:56 there because <inaudible> if you're talking about eCommerce email marketing, it's getting very, very difficult to differentiate yourself in that space. And I feel that pain, you and I have talked about that pain and Shopify, others that are coming into this space, they are having the same struggles there and the ones that are staying on top are only barely staying on top because you know, they have market share and they're doing the right features for the customers. But I always feel like, you know, you're, if you get one or two features, key features behind your market is going to shift under your feet right there. That's what it's always felt like to me. I don't know about you.
Speaker 2 09:34 Yeah. Well, yes. I mean totally. I think, um, you know, when you know, and this probably not exclusive to the, the, the marketing space or the I-CAR space, I mean there's probably other sectors where the exact same thing as is true. But I think when, you know, when we play in a landscape where there are so many big funded competitors, do you know whether, well, they, they didn't even have to be funded, right? They could just be, you know, just massive and have, you know, a massive war chest to, to do things. I think the, the risk is always there that they, um, with their size and their speed or their ability to put up things, they can essentially skew a market might and they can skew a customer's kind of perception and expectation, you know, in terms of what they want from others. Right.
Speaker 2 10:21 And yes, they sometimes then kind of, I think where they, those bigger corporate kind of, you know, leave a gap is normally, you know, uh, you know, either and <inaudible> over-complicating a product or not having great customer service or um, you know, over pricing, like not being cost efficient. Right. And that doctor AIDS the gaps for smaller, independent companies to then come in and build viable businesses. But there are, I think the risk is still there for, you know, kind of, uh, you know, for, you know, teams and companies to really nail that and to essentially threaten the livelihood of smaller, independent companies. So I think I said, I don't think it's just exclusive to, to our space. Um, I think that's true for, for most office spaces at this stage.
Speaker 1 11:05 That's a good point. That's a great point. Now you didn't just get this offer cold from campaign monitor, you've actually had a relationship with them for a long time. Can you talk a little bit about like how, you know, you went from customer of campaign monitor to, you know, Hey, we'd like to acquire you guys, you know, that that seems like there's a, there's a map of something going on in between there that isn't entirely clear and you know, I realize you may not be able to talk about everything but you know, talk about what you can on that.
Speaker 2 11:35 Yeah. Um, and I, I mean like the disclaimer here is, I'm definitely a, you know, a couple of rounds of beers short of connecting all the dots here. I think the, what I can say this though, I think the fun part of the story is that we were, you know, campaign monitor customers with routines back in the day. And I think you kind of way, way back then, it was just as I think SAS started, I think, you know, well become, became more popular and more people at least start talking about it, right? I mean it was, did they have kind of, you know, the base camp rotation signals back then and coming out, you know, out of the woodwork basically and say, Hey, here's a Bible way to go from consulting into kind of product rights. And um, I can remember back in the day, we were on three, seven signals they put doing like a whole set of, of uh, feature posts that they called bootstrapped profitable and proud.
Speaker 2 12:27 And we featured alongside campaign monitor, which I still, like I said, I mean it's just one of those things. Um, I've, I've referenced that article cause it's still in line I breakfast it's so often just because it was so cool. It was so cool to kind of be side by side with campaign lights or who was at least by kind of, I never knew numbers but they were always the bigger company. Right. They, they had like, we were the kind of the unknown, you know, company dumps off and you know, Cape town, South Africa, right. But <inaudible> had these beautiful offices and you know, in Sydney. So it was always a very kind of aspirational company for us. At least. You're both for myself, Mark and I miss right. And I eventually got, I believe it was 2012, um, where I actually kind of got to meet Dave Greiner who's one of the cofounders and given month's or met him at business of software in Boston.
Speaker 2 13:18 And we just kind of, I mean there's a, I I wouldn't kind of name drop, you're in pain. The Davids <inaudible> my biggest friend but like he is a friend and we kept in touch and I can remember like one of the, in the early days with, you know, conversion when we were still called Receiptful for example. Uh, you know, I didn't know how to price this thing and I actually emailed, you know, day before for help and like the one thing I can remember is he steered me care of, you know, pay as you go pricing for, for email, which I think is, is now actually kind of blessing, right. That I need to to say no. So, like I said, that that's, I think that's the fun part here is that there was, regardless of conversion itself or the ultimate acquisition, there was, there were different new ties.
Speaker 2 14:02 I had a different kind of, I'm in relationship with campaign moments are as a brand and you know, with some of the people there. So I think that is pretty cool. As for the deal, that's what why I made kind of the disclaimer about the rounds appears. I do not know how much that's kind of uh, you know, paused and that relationship that I had with campaign monitor actually played into, you know, how like we became, uh, you know, uh, a viable or interesting option for acquisition, you know, for them. So yeah, I said, I, I need to buy a few people a few beers and figure, you know, and connect a few dots on that one.
Speaker 1 14:39 Well, I'd be happy to sit down with you and do that sometime. Um, yeah, the reason that I was asking those is that, you know, as a founder of a company that, you know, may someday actually get acquired. It's interesting to kind of see what was the landscape and how did that sort of evolve, like where were the serendipities and the opportunities that turned into a lucky break or, and the actual path to acquisition. So that's, that's what I was trying to get at here. So it's sort of getting along that same thing here. Um, I presume that you probably went around and shopped Conversio or had other offers once you started doing that, you went with campaign monitor, obviously. What made you turn the others down if you had them?
Speaker 2 15:25 Yeah, so I mean, I think the, the first thing I can say that, and by the way at night, I highly recommend that, you know, the, the, the following, um, I would ultimately proceeded this whole process was, uh, I chatted with, you know, how to chaplain through our boiling at your microcosm and Dubrovnik, uh, in November. And Rob interviewed me to, to INR who is his partner, um, at tiny seed, but I know also runs discretion capital. Um, and essentially does MNA advisory and brokering rides. And I think, and just kind of approaching this, I'm getting to a point where we, we did have, you know, multiple offers, um, to consider multiple options. Even broader definition. You're like, I was having someone experienced that process was incredibly helpful. So I definitely, for any founder out there, you know, considering, you know, selling their business in future, um, like get great advice and help, right?
Speaker 2 16:22 In terms of actually deciding between kind of the offers, I think like there were things that were important to me. Right? Um, I think the least important part was the, you know, kind of a doll to evaluation, right? Cause I think, you know, once I think if evaluation is fair at least, right, you know, 5%, you know, left or right or 10% left, right, it becomes immaterial at least, you know, in comparison to, uh, you know, other concentrations. So like that is part of it. But I don't think, you know, for me at least, that was not the biggest motivator here. The things that I was, was more keen about was, you know, finding, uh, you know, finding a new home for the product and the team that would essentially allow both of those to, you know, to flourish. And I think in doing so kind of that had to be a, you know, similar kind of culture, um, and similar values, uh, at least. So I think those are ultimately, you know, kind of the, you know, those were my biggest considerations. And then as I said, I think, you know, the, the day that, you know, kind of, you know, campaign monitor, express, um, you know, interests, they, they essentially had the inside lane. Right. Because, because of that, just that, that bond and affinity that I had with the brand. So I mean that's, you know, that that very subjective part ultimately played a big role as well.
Speaker 1 17:51 Yeah. Sounds a lot like the same sort of considerations that Rob was having with drip and lead pages, that culture fit and his team were like really top of his mind there. And anything that would compromise those was off the table immediately. Sounds like it was the same.
Speaker 2 18:06 Yeah, exactly. Cause I think, you know, as you know, the one thing that I think as a founder like in terms of, you know, building a brand and building a reputation, like the, the the worst thing or what number and maybe not the worst thing, but like that ain't the way you deal with your team in an acquisition. I think you get a reputation for that kind of thing. Right. And again, like I, I had a, we had a small team at, at the point of X we were 11 people. So you know, it is possible that, you know, even if I was being a bit of a deck that completely kind of at that that narrative completely vanishes and you know, five or 10 years down the line when I'm working on new thing, you're trying to sell that or whatever the case has been.
Speaker 2 18:45 Nobody remembers what 80 did to his first team, but, or his previous team. I guess the only risk that I think <inaudible> worthwhile to take. I think, you know, um, you know, being respectful and honoring what a team has kind of built together. You should be, you know, important, you know, important. I, I didn't think it should be just for founder at least, you know, to be like almost pump pumping dump kind of thing. So hence why that was so important. Cause I think that kind of thing, I think it's possible to get a really bad reputation. Um, you as fallen in that as an entrepreneur if you, if you don't at least try your best to find a great home for, you know, for your team in an acquisition.
Speaker 1 19:24 Yeah, I like using the whole pump and dump thing there like that. That should not be your goal there. Yeah. I totally agree. So as a two exit founder, what would you say was harder about this exit than the one from, whew.
Speaker 2 19:39 Oh, um, well I think Samantha and East was easier because I sold, I mean I sold to Magnus and Mark, right. So, um, they remained in the business, the business essentially. Um, you know, we repurchased my, my equities. So I think the, the complexity there was the front, the kind of a, I was also just younger and more immature, so which made that kind of exit much, much harder and much harder than it needed to be. I think with this exit. And again, like I think this is an absolute saving grace and you know, in hindsight, but once, you know, once we had a no at all, I signed, um, you know, I never said you have to get the absolute best, um, M and a legal counsel that you can on this deal. And we ultimately found a firm that was very experienced, um, and they did a fantastic job in terms of guiding us through that process without them.
Speaker 2 20:42 Like, it would have been really, really hot. Well, it would've been even harder. You're trying just learn so many things. I think, you know, the, there was definitely kind of technical complexity in terms of the kind of into the legal side of things. That was really tough here. Like that was really tough. Um, and I think related to that, like we, we had a really short amount of time from kind of, you know, signing other to closing. And that was intentional. I think having a short time to close is, is good in many ways, right? You don't have the risk things going South, right. To some extent because there's a lot of momentum, but it's also just like within two months, like at a, you know, kind of getting that position over the line, uh, you know, took over my whole life. Right. So I think those things, you know, it was just, it was just hard for two months, you know, for three months overall and was just a, a really challenging time.
Speaker 1 21:39 Yeah. Yeah. And having the short close time also helps avoid buyer remorse too.
Speaker 2 21:47 Well, one would hope so. Right? I mean, um, yeah, I mean it's like nobody in the group has told me just yet that, um, you know, can they exchange this? Where's the, you know, where's the warranty? Everyone seems pretty happy and we've, um, you know, we've done some good work since <inaudible> actually close. So, yeah, I, I'm not aware of any buyer fee more just yet.
Speaker 1 22:11 Ah, that's good. That's good. All right, so let's pull out to a broader picture for a second. You like me and like Craig on the show, we're all family men. So, you know, we have kids, we have a wife, we have a life outside of being an entrepreneur. How has your journey changed from Wu through public beta to Conversio? What things you know, are you just no longer willing to do today that you would have done back in the Wu days?
Speaker 2 22:42 Oh, um, I don't think there's anything to be honest, actually, that I wouldn't, you know, wouldn't do now that I kind of would have done back then. I think, you know, I, I love, um, what's how Natalie from, from wild, but she, she had the tweet where she bent he a couple of months ago, she said, cause there was this whole thing about kind of hustle porn, right? And entrepreneurs and founders working way too hard. Then experienced successful founders, almost shaming, you know, kind of, I would say newer founders like in terms of their journey rights or younger fathers, their their journey and saying like you shouldn't work 80 hour weeks. And then she made, she said like that's complete bullshit because most of us at some stage work 80 hours weeks for years to get kind of our business off the ground. Right. So I think to that extent that these, you ultimately find a way to get things done as a founder.
Speaker 2 23:34 And I don't think that there's really, you know, except for the kind of obvious ethical things and criminal things, I don't think there is really anything that's off limits with me. What I will say though is like I, I mean towards the end of, with themes, my first kind of, you know, first son was born and we now have two, two boys. They're almost eight and almost five brides. And I think there I have been more reluctant two work so hard or work in a way that I can't be present for them. So whether that means does he present, but being in front of my desk and you know, not being able to physically spend time with them or working in such a way that I get into such a frenzied state mentally and emotionally that I'm physically present with them, but I'm not really kind of your presence.
Speaker 2 24:25 Um, so that's something that I really tried to be much more aware of just personally at least, um, and having better boundaries. Right. And that's definitely kind of that translated at least to kind of what we try to do within the team. Right? So we installed certain things in the team and like considers our values are about culture and what ended up happening, which I am now kind of, I think that's probably one of the things I'm most proud about in terms of what be created, uh, was the fact that we got to a point where as a team we defined our culture as being family and life first with ideas. Simply being that, you know, we want to do, you know, fun, challenging, stimulating work. But the most meaningful experiences that we can have is outside of work, right? Where friends at work, but we don't like work is not our lives. Right? Life is the rest of the life kind of life. Right. We're just kind of fits into that. So I think I said, you know, that's from my side, just personally, that was more of a, you know, awareness to try and gravitate towards that more often, to try and optimize for that outcome more often instead of necessarily saying, there's definitely some things here that, you know, I, you know, when all went, you kind of do. Um, in terms of my work.
Speaker 1 25:40 Yeah. Yeah. More work to live, not live to work. Although, yeah. You know, it sounds like you might be a little bit like me in that if you can get into a state where you're just like totally focused on the work and that it actually requires some mental awareness to say, all right, I'm way too deep into this and it's taking me away from the things that I consider important. And so I gotta I have to separate that and make a, an actual boundary of it.
Speaker 2 26:09 Yeah, totally. And you know what, they would, I think the, the like, uh, I wouldn't say the best thing that I did, I think to a good thing. Um, and I will explain that now, but the first one is, is not that I wouldn't say that, you know, having a partner, maybe you know, my wife and the same sense that's, is that like her, I think she's learned over the years to pick up on my cues in terms of when I'm to, you know, kind of way too deep down a rabbit hole somewhere in terms of work and shift. She has a way to either create space or like, you know, kind of me out of it. So like having that has been great. Right. And then from my side, like when you know, when she does take up a cue, like to understand that this is someone that's observed me, you know, for, you know, for a couple of days, couple of weeks, couple of months sometimes.
Speaker 2 27:00 And as I figured out that this near like something at work is off, um, and it's, you know, putting me out of equilibrium. So I think that's, you know, in terms of those kind of boundaries, that's been helpful. And the other thing, and that's what kind of, I think the kind of the, the best thing that I did, which is very counter to, well I think most people would say I hired my best friend who was kind of ultimately became our COO and he became my two IC and which meant like we totally blurred all lines in terms of kind of being a friendship and professional kind of work, right to mean there. Like when we hung out and had beers, the conversation could be about work for example, right? There was like, I don't think, you know, both of us weren't necessary greater those boundaries, but what that did as well, at least, you know, but that's my perspective, right?
Speaker 2 27:48 Had the benefit that I got there was that I, I always felt connected to what was going on at work, but I also felt connected to what was going on in the rest of my life by just in that kind of single kind of relationship and friendship. Right. Cause it was constantly, I was in a suit pulling, but you know, reminding me of both those things. Um, and a very contextual way. Cause I think that's the hard thing with at least friendships, most friends that I can totally say shit. Like I barely read tough. You're at work, but they don't necessarily have the context. Right. And they, and they're not investors in your business or in my case, like they don't have 70% equity in the business. So they, it's, it's not the same. Right. But having someone in the business that's also your best mates, like they have the context, um, and they can seamlessly shift from between both those worlds. Um, yeah.
Speaker 1 28:44 Wow. That's interesting. Yeah. I w I would not have expected that. And I, that's definitely a very unique situation. You know, I have lots of good friends but they're not necessarily overlapping in tech and then some that are overlapping in tech. You know, I think we are good friends but I don't know that we'd necessarily be good business partners. So that's really awesome that you had that mixture there. That worked really well. That was, that was super cool.
Speaker 2 29:07 Yeah. I, I'm the coolest thing by the way. We, um, the two of us have a third mates and I actually poached, I post them from our other mates company. Um,
Speaker 1 29:17 Oh we do,
Speaker 2 29:19 which w who is also was an investor in know kind of conversion as well. So, um, it's a very incestuous kind of thing going on. You're obviously, um, but yeah, I mean I think all of those things, I think it's totally counter. Like most people say don't do business with friends. I totally think there's a place you know to do that because if you contrast your friends, like who can you trust?
Speaker 1 29:40 Exactly. Exactly. All right. Let's, let's pull back a little bit further here. And we've talked a lot about your new company and your journey here. As an entrepreneur, I'd like to hear a little bit about what you think in eCommerce space, because obviously as a guy in Conversio and you've been working in there for years at this point with woo commerce and, uh, Conversio both. What do you think the future holds in e-commerce right now? Like what's going to be a commodity in five years and what's going to be a differentiator that we don't see today?
Speaker 2 30:16 Um, yeah, I mean, I, I wish I had that crystal ball, right? I mean, Dave, I know you're obviously asking, cause like whenever I'm going to say you're just gonna take our crystal ball and you're going to blow it, right?
Speaker 1 30:29 Well maybe, maybe. I mean, part of it I think is the, you know, there's enough people in our audience that are looking to build businesses and trying to figure out what, what would they, you know, where would they want to go? Where's the puck? Gonna move on the ice. Right. And obviously I'm interested in that too, but that doesn't necessarily mean that it would overlap with what I'm doing in recapture. But I'm, you know, I like talking about e-commerce in general and just sort of speculating, where do you think it's going to go? Cause there's lots of crazy shit that's out there. Uh, so what, what's your crazy shit?
Speaker 2 30:58 Yeah. So I, you know what, I th I think that the thing that I often come back to, um, and the two things, right? You know, it's just, it's always still top of mind for me. So I think the first thing is, you know, profitability, right? I don't think we're, like we speak or profitability gets mentioned enough and the e-commerce kind of space, right? And specifically, uh, you know, this is, I can, you know, we probably need seven hours from you two to go off on this tangent, but I'll keep it to three sentences. Um, I mean, my wife runs an eCommerce business and like, I know for example, because I have a accounting degree, right? So I understand accounting and just using shitty inventory software to get her like accurate, you know, <inaudible> cost of goods sold figures is really hard. Right? And if you can't do that, then you have no idea of profitability.
Speaker 2 31:55 All right? So, and I think if you don't know whether and how your property in your eCommerce business, then that's not sustainable. Right? So I think that's the kind of, the first thing that I think is in string in the next couple years is how can the profitability plays out. And then the second part to that is daunting kind of customer acquisition costs, right? And the channels that we use for that. Cause I think what we're really seeing at least is <inaudible>, no Facebook ads, Google ads, all of those in most kind of markets have become like the cost has gone up and the ads have become less effective. Right? Engagement was on convert conversion rates down, right? So if you layer on top of that, all the kind of the, I think the, you know, the dissonance, you know, with those companies and data privacy and like just the shitty bad vibes people have with them.
Speaker 2 32:45 And I know that this is probably more us because we're in the tech space and like we're the early adopters and we feel that more, but that's gonna kind of bubble up brides and it's definitely going to hit the mainstream and that your next couple of years where the sentiment towards those companies is, is going to change. Like people might not be kicking their ass at all but to be using Facebook in five years time. And I think the reason I mentioned that related to profitability writers, that customer acquisition cost, again another thing beyond kind of your inventory costs that influences profitability, but as soon as you take that away in terms of where do I find customers like that is a question that you know the the eCommerce ecosystem will have to solve for, right. How do you find customers if you can't, if you actually can't at no cost, you use Facebook or Google or Instagram or whatever. But you know the, you know, the, the cool kids are using these days. But I think those as for me, these, that those are my biggest questions that I have for, for e-commerce for next couple of years.
Speaker 1 33:47 Those are pretty solid ones. Yeah, the profitability one. Yeah. Approaching that from recaptured. We always look at it from the how are, how are people converting? What kind of revenue are you making? What's the customer lifetime value? What's average order value, stuff like that. So that's all on the input side. But on the output side, for the cost of good sold, you're right. If we, if you don't know what that number is and you don't have a really solid idea, you're screwed because you can have all kinds of stuff coming in. But if you're pushing it all out, your business is not going to survive. Yeah,
Speaker 2 34:19 yeah. Well, exactly. That's the, I think the, you know, I, I've heard at least a handful of, you know, kind of podcast episodes, multiple shows where no funded companies find themselves in situation where their unit costs <inaudible> making a loss on the product as it's wide, which means they experienced significant revenue growth. But the more revenue they get, the more money they're losing rights. And most of the seat, I said like you would think someone in eCommerce understands what a Darden gross margin is. I'd but many people don't. Right. So yeah,
Speaker 1 35:00 math is hard.
Speaker 2 35:03 Well, yeah.
Speaker 1 35:04 Yeah. And the, and this has been true for years, by the way. I remember back in the dotcom days where everybody's like, Oh yeah, we're losing money on every customer here, but we'll make it up in volume. I'm like, that's not how that works.
Speaker 2 35:16 No, exactly. Exactly. Right. And I think that's it. Like you didn't get into the question of what scale actually looks like for, you know, but you commerce company in the next five to 10 years because like economies of scale probably still exists. It probably just doesn't exist them like the way it did in the past. Or you could say like, sure I can only afford a hundred units, you know, manufacturer a hundred of this thing now and at greater volumes. Like I can reduce that cost by 30% right over time as I can find where capitalized. I don't think that's what economies of scale industry looks like for your course carry forward. It comes to scale. We'll have to come in different ways probably and probably the most obvious one and one that's close to my heart to these is to think about what you can do for your brand, right? Because a brand can scale. It's probably not the most measurable thing that you can do or directly attribute growth to, but I think that's where the kind of equals brands that are going to win are the ones that are going to find those economies of scales in their brand and not like within other things, not within their kind of specific customer acquisition channel that's working or within, you know, kind of the, you know, their, their cost of inventory.
Speaker 1 36:25 All right. Switching gears. Last question here, you obviously spent a huge amount of time in the WordPress space and I can imagine that after you left Wu that you just suddenly stopped thinking about WordPress altogether. Cause Conversio for example, I know supports a woo commerce. So with that said, what are your thoughts about the WordPress space? Cause they are seeing a ton of change in there right now. Gutenberg is on the scene, automatic is making waves with jet pack. All kinds of stuff is going on there right now. What, what do you think is the future of WordPress and where do you think the biggest struggles or opportunities are in that space right now?
Speaker 2 37:05 Yeah, so I'm going to surprise in your day. Like I, once a week, once I got on food, I literally got out of the WordPress ecosystem and yes, conversion did have, you know, does have a <inaudible> course integration, but I am definitely not as anywhere close to kind of WordPress itself as I was kind of back in the day. Right. Um, I mean I'm still a user, um, and I still think it's a great skin of product. And, uh, you know, what's <inaudible> is a really good company, but I, I don't have to, I don't know that there is anymore. Right. You know, if you asked me like five, six, seven years ago, like I would have some juicy took bites about the, you know, about the ecosystem that said though, I think what is interesting is that's some extent, at least, you know, I think everyone undervalues you know, what's a magic as a company, right?
Speaker 2 37:55 And doesn't necessarily understand just the magnitude of their reach, right? I mean, I think what they're up to, you know, powering almost 40% of the, you know, the internet and if you add, you know, tumbler now, like that number becomes significantly more, right? So you said you have a company that has such a broad foundational base, but if they were to properly monetize this, you have a massive company. Right. And I think what is interesting and what is definitely in their favor in that sense is, and I see this often when people speak to me about Shopify versus eCommerce for example, where, you know, so far as the media darling and mean fantastic company, but then you look at something, I read commerce and like I know that whilst it's much harder for big commerce being a kind of distributed solution here to have the kind of merchant data that Shopify has that in volume size, at least they are probably there or thereabouts.
Speaker 2 38:55 Right. But people don't perceive them as such. All right. So I think, you know, in that sense I got you. Here is what's meant to get a bit of a, you know, and WordPress is a bit of a kind of sleeper company in that, you know, uh, in that regard. And I said, if they, if they can nail there, you know, all of their, you know, revenue opportunities in the next couple of years. Yeah. I think it's gonna be fascinating, but you know, the, the, the buck before press is always that there is a, you know, there is a tension between, you know, the capitalist mindset, um, and you know, the open source philosophies and ideologies. So, um, you know, whether kind of getting those aligned, you know, and, uh, alignment in a way that's agile enough to really build a massive, massive, like even bigger business rides. Um, I think that's, that's going to be interesting.
Speaker 1 39:45 Okay. That's fair. I actually am surprised. I kind of thought, you know, once you kind of get embedded in WordPress, you know, you're just gonna follow along with the news stream there. But yeah, I could see that, uh, getting into e-commerce would have distracted you there.
Speaker 2 39:58 That doesn't mean, you know, one thing is it's, I don't think it's just that I think, um, you know, at least my kind of experience, uh, you know, from back in the day was, you know, because it was open source as well. You know, there's, there were many cooks in the kitchen. Um, and it's easy to have a loud voice and to shot the people at, which means that there's just, you know, there's just a bunch of politics as well. And to some extent, whilst I, I still have great friends in the space, you know, and I, there's no, I think there's ill feelings, but I think to some extent as well, it was just, you know, it was good for a phase of my life and then I wanted something new and I wanted to get up of that a little bit, if that makes sense. Right. So because it is, it is a very, there is a WordPress way, you know, for doing things. Um, and I basically just, I just, I exactly right. You know what I'm talking about.
Speaker 1 40:50 I do
Speaker 2 40:52 like everyone will have their own definition, their own rights, but there is a word persuade and I, as I, I just wanted something a little bit different.
Speaker 1 40:59 Okay. All right. I get it. I lied. There was actually one more question and actually I feel like this was the most important one and it was the leading question on my list there. So you have a book of poetry coming out. Correct.
Speaker 2 41:12 Yeah.
Speaker 1 41:13 So talk a little bit about that. And I like to hear, cause this isn't something that you hear a lot of founders doing in general, it's not, you don't hear a lot of people doing this in general unless you're like, you know, a lit major in college and you're writing poetry or reading poetry as part of your, your thesis or something like that. So why, and this may be a bizarre question, but maybe not because I think I know you well enough that there's probably a connection between the two. How does poetry help you be a better founder?
Speaker 2 41:43 Yeah. So then the, the backstory then is that, uh, when back in, uh, November, 2017, right? So it's almost two years ago, went through a, uh, really challenging time and the business had to, uh, retrench layoff, um, you know, two team members, uh, had to brutally kind of yank the business around to safety. And it was just a really tough time generating rides. <inaudible> and for some other reason, uh, cause the last exposure I had to, to poach ETL was, you know, probably high school. Right. And for some other reason, you know, between, uh, you know, just based off some of those billionaire calls, um, you know, that we had
Speaker 1 42:27 on my, no,
Speaker 2 42:29 I got a recommendation to um, to pick up, uh, you know, a book of poetry by Rupi Kaur called milk and honey. And it's very much, uh, you know, contemporary poetry, which means also very different to kind of the poetry that I was exposed to, you know, in high school was supporting more like in a classical realm. Right. And I started reading this and you know, groupies work is, you know, very rude, very emotive, pretty provocative. And for summary, I think initially it was just, it was a complete distraction for me. Two from the, the challenge that I was facing in business in life at the time. But I think in that as well. Um, a big part of what I procrastinated from from her book was this idea of, you know, really being yourself and putting your, your true self out there. And that process became, we became really cathartic.
Speaker 2 43:26 Right. And I essentially looked down, cause I, I've always enjoyed writing journey and I will always used writing whether it gets published or not, but I've used writing as, you know, a bit of therapy, right? Just to kind of cleanse, cleanse my mind and you're trying to clarify some thoughts. But I essentially looked at that kind of, um, you know, the way she was writing. And I figured, you know, how, why I have emotions, like what would happen if I tried to put this, you know, and, and paper. And I think what ultimately ended up being really fun at the time was that I felt quite, you know, kind of, which probably sounds ridiculous kind of being an entrepreneur, but I thought I felt constraints like within the business. And like I felt there was a structure, like, uh, you know, being profitable, having enough cash in the bank.
Speaker 2 44:12 Like there were clear like markers of like, you know, do this, don't do that, you know, fuck this up. And what the poetry ultimately did was, you know, especially the kind of contemporary poetry that seemingly has no rules, right? You could just do like, right, single, you know, single line of and words and it becomes a poem. I mean, I think, you know, from my upcoming book, for example, there is one poem that is simply the following line, which says, I think, I mean, if I remember correctly, can I give you some of the Koolaid that I'm drinking? And that's about right.
Speaker 2 44:49 What would it be? Not like what I loved about that was it was really free for, and it was just such a different experience for me to be creative and to be able to do something that had, didn't necessarily have any goals that they had to achieve and it didn't have any requirements. Right. And I think just through that, like ultimately like where I'm at today, um, you know, to answer your question in about, you know, how it influences me as, you know, as a founder, I think there's more of a artist, um, you know, kind of in the way that I think about business and not just this almost kind of industrialist, this, this worker bee, um, kind of mindsets. Um, you know, someone that is, you know, the ones to struggle, you know, kind of more than one perspective, not just capitalism but capitalism and something else.
Speaker 2 45:37 Um, or you know, and maybe it's not even just two things. Maybe it's like three or four things, right? But I think that's at least what kind of, what poetry and integrator concept kind of art has done from you. Can, I think most people, again think I went through this person, by the way, when we get in, like, you know, I, I probably have too many words about this, but I started this journey thinking that, you know, capitalism and business on one side and art was completely opposites. And I, I slowly started to merge those and I, like I said, I think there's a intersection there where they overlap, where one can do really great creative, valuable, profitable kind of work. Yeah. I don't know if that makes any sense.
Speaker 1 46:17 That, that's fun. That's really cool. Thanks for sharing. So you're like, you're a little bit Carnegie, but you're a little bit Tennyson and you're still one of the 10 youngest billionaires. So it's like you've got all the things going for you here.
Speaker 2 46:30 <inaudible> exactly. But, but remember, it's only 10 youngest in Africa. Like that's important. You have to like that the African heritage is important there.
Speaker 1 46:36 Yes, yes, of course. All right. So, uh, 80 uh, can you tell people, you know, if they want to read your poetry or if they want to read your blog or connect with you further, what are the best ways to do that?
Speaker 2 46:48 Yeah, so I'm, I, I'm hopefully back to my Wiki publishing said you shared a lot on my blog, which is, you know, 80 double-eye. Dot. M E. um, otherwise I am also, uh, 80 <inaudible> at both on both Twitter and Instagram. Instagram has some poetry. There is some poetry on my blog as well and the book should be out. I will save myself a goal before the end of the month. Um, if all goes well and I will be announcing at or making available via my, my newsletter society if anyone wanted to read my contemporary thoughts and poetry. Um, you know, that's the, the safest bet in terms of you're kind of finding out when it is ready.
Speaker 1 47:27 Awesome. Well we're looking forward to seeing what comes next and for those that are listening, if you have any thoughts or questions for ADT and we didn't ask them today, please send us an email podcast@roguestartups.com we'd be happy to follow up on that. And if you're enjoying the show, the one ask that we have is that we'd like you to share it with somebody you think could benefit. Thanks for listening. Until next time,
Speaker 0 47:53 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>.
