Episode Transcript
Speaker 0 00:08 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 00:19 All right, welcome to episode two. Oh one of rogue startups and happy new years, Craig. And happy new year everyone.
Speaker 2 00:28 Happy new year, Dave. Yeah, this'll be a, this will be going out on new year's day. Uh, we are a full, almost two weeks ahead at this point. So this is, uh, uncharted territory for us to be recording a bit into the future. But I think our topic today is a little bit timeless, are a little, it's, it's very timely and timeless at the same time, I guess.
Speaker 1 00:46 Timely and timeless. Yes. And if we can throw in a few more suffixes onto the word time. Time, full time. Licious
Speaker 2 00:55 Oh yeah, dig it. Yeah. So I think, I think we're going to try to put a spend on a typical kind of end of the year wrap up episode, but with a, with a little more kind of tactfulness and things that folks can take away. Um, our Christmas episode was kind of things we've learned this year, things that are working particularly well for us and then things that aren't working well for us and, and about a dozen of our kind of friends and colleagues. Um, but I think specifically Dave, like we'll probably do a deeper dive on, um, kinda how our years went. Um, and, and some things that we learned, uh, and that we're doing differently going in or thinking about differently going into 20, 20, uh, as a result.
Speaker 1 01:35 Yup. Yup. So let's just jump right in. What was your year like? What do you, you know, I mean obviously we've been talking about this for 52 weeks at this point. So that was sort of a dumb question, but no. Okay. So now you had some time to sort of look back and say what the fuck was working and what the fuck wasn't, you know, what would you do differently at this point? You know, cause when you're in the, in the thick of things, the day to day, the week to week, you don't really think about the strategic so much cause you're always buried in the tactical. And now you know, this time of the year kind of gives us that chance to look back and say, all right, well get out of the tactical and look at the strategic and what should I be focusing on next year?
Speaker 2 02:18 Yeah. You know, the thing that really jarred me from my interview with Asia Matos was you know, when she sees people really, you know, 10 X or two X their business, it comes from something that is not a kind of in the weeds technical booth. It's like a big integration or partnership or the shift in the business model or something. And when she told me that, I was like a little bit feeling like I am such a schmuck for thinking about like how can we squeak out 10 more trials a month from AdWords or something instead of thinking like really big, like, you know, like, so for an example for us it's like what do we need to do to charge $200 a month? Like that's the kind of question I need to be asking myself and, and, and like to where people would be lining up to get that right.
Speaker 2 03:09 Um, and I'm talking about for Castillo's and so that's the kind of thing that now I'm sitting here asking myself like, okay, how do we go from, you know, our lowest plan is $19 a month. How do we take our lowest plan and have it be $200 a month or a plan that's 200 or $500 a month and try to try to go kind of up market. So that's like that kind of really transformational thinking is, it's probably the biggest thing that I've learned recently. And I kind of look back at this year and kick myself a little to say like, Nan, I didn't, I didn't do a lot of that. Now it's like the end of the year and I'm realizing that, that I need to do it. So it's better late than never. But I think that it's scary for a lot of us to say like, I'm going to break my business and, and hopefully go into this other kind of direction or offering or target a different type of customer and maybe that'll really, really, really make a difference. That's cool. But that's scary. And so I'm excited about doing that into the new year and we'll be talking about it here on the show and how it goes. But, you know, at the same time, it's interest scary and it brings a lot of unknowns with it. And that's, um, yeah, it's, it's, it's exciting, but it's nerve wracking at the same time. So
Speaker 1 04:20 yeah. That, uh, by the way, that episode with Asia that you had was awesome. I'm so bummed that I missed that one cause I really would have loved to have been part of that conversation. It sounded like it was a lot of fun. Yeah. But um, I, you know, echoing that, like you gotta find that one big move and sometimes you don't, like for me this year I didn't realize when I made the move that I did that it was going to be that big of a move when I lowered my prices in Shopify and at the same time built in expansion revenue. I had no idea about the overall impact I was going to have with that move. Now of course, you know, the whole charge more thing says that the various experiments that I was doing shouldn't have even worked. But it did because it had to do with the price anchoring of the platform itself because Shopify starts at 29 a month.
Speaker 1 05:14 So if you start at 29 a month and people are like, Oh, that's reasonable, I can live with that. And then from there, once you get people jumping on board, then they can start to build their own volume. And then those that have a decent volume already got the expansion revenue. So I got a lot of growth out of that and it was very unexpected and of course because it was an integration and I had, you know, I always hate talking about luck, but I think it's an under acknowledged thing about all of our businesses that timing and luck play as much of a role as hard work and making sure that you're solving the right problem. If you don't have kind of a mixture of all of those things in your, your business can definitely struggle cause you can have the best idea and really good execution on that and just be late to market and people are going to be like, man, you know, it doesn't matter how good all the other stuff.
Speaker 1 06:10 So there's a timing aspect to it and sometimes there's a luck aspect to it. Just making sure that you're in places at the right time. Like right before things switched over. I really got lucky with the Shopify app store. They changed their listings and their algorithms in late 2018 and not everybody was ready for the transition, but I was ready. I had put all the work in to make sure my new app store listing was ready to go the second that they switched it over and then all of a sudden when it switched over, I got awesome rankings right off the bat. And with a few more tweaks, I moved those rankings up even a little higher. And now that I've already gotten there, others are trying to catch up. But if you have to play catch up, that's a harder longer game than it is if you just get it right off the bat.
Speaker 1 06:56 So that was a pure thing of luck. Absolutely luck. But then that luck six months later translated into combined with the price change, a growth opportunity for me on Shopify. Is that something that the average person can replicate? No, because that is a timing issue. Right. So you know, I, it brings me back to something that Justin from texting talked about. So if you don't know who Justin Vinson is, Justin Vincent has done a variety of things. He came to a microcosm and did, uh, he was working on a social media app for Twitter called plug EO and he's worked on a variety of other things and uh, he does nugget right now, uh, among some other consulting things. But anyway, he talked about on the texting podcast a long time ago, that concept of luck service area. And I firmly believe that you are in control of your luck surface area.
Speaker 1 07:50 So think of it this way. Uh, let's, let's use the analogy of a hailstorm and a garden. So let's say you've got a very small garden and there's a hailstorm that comes in. Well, it's very easy to protect that small garden with, you know, a cover over your tiny little space there to keep the hail off of it. Now if you have a larger garden, it's much harder to protect that because you have so much more space that you got to keep the hail off of it because all of those little tiny ice balls are going to go through and destroy your plants. Well, your luck surface area is very much like that, but in the opposite way. So if you have a small footprint in entrepreneur space where maybe you're not very well known, maybe you haven't done a lot of work, maybe you have a little experience in marketing that provides you a small luck surface area.
Speaker 1 08:43 But if you are putting yourself out there, you're making more networks, you're trying to attend conferences and you're doing more work and you're doing it in public, it increases your surface area so that more people are aware of it. And then suddenly when there's an opportunity, because you've increased that awareness because you have that larger surface area, someone is going to say, Oh, do you know about so-and-so over here because they're working on something that's kind of like that. Or maybe you should go talk to this person because they sound like they would be a perfect fit for this. That's luck surface area. So you know what I've been doing in the Shopify space for the first couple of years with recapture, I had a small luck surface area. I just didn't have a lot of recognition in the space. I didn't have a lot of contacts, I didn't have a lot of connections, I didn't have a lot of relationships and now that's slowly changing to where I'm able to leverage more of those relationships and say, Oh Hey, maybe let's do a partnership this year with this other hosting company and try to get a bunch of WooCommerce installs that I know about in the WordPress space.
Speaker 1 09:54 So all of those things don't come because I just showed up and asked for them. It's because I've cultivated something in the past and then have the opportunity when it comes up to be able to, I don't want to use the word exploit because that's not the right way to capitalize on it. That's better that, yeah, so you get a chance to capitalize on that. And that capitalization is something that I've seen all of our friends that are very, very successful do. When, you know, Rob was getting started with startups for the rest of us and MicroComp and all of these things. He wasn't that well known, but he did lots and lots of things. He bought and sold businesses. He made connections. He started the conference, he published a book, he was doing a blog, he did the podcast. All of these things massively increased his luck surface area. So then when other things came up, Rob Wallings name was in the mixed and that's how, that's how you can get that kind of success. You have to increase your luck surface area. And so knowing that for this year, one of my goals is to try to continue to capitalize on what luck surface area I have and expand more of it so that I can actually get more opportunities in later in 2020 and 2021 yeah.
Speaker 2 11:13 Yeah. I think this is, I think this is really powerful and I think that the key here is not like you have your luck surface area, which has increased by just being out there and doing stuff in your space. But then it's the, the, uh, awareness to recognize what's going on and capitalize on those opportunities. I think that's like the real magic is like when you, when you see something about to happen and you're in the space and you can capitalize on it like you did with your, you know, your listings or like, yeah, Rob did with drip realizing that like marketing automation was where email was going. Um, I think that's where these massive hits come. Um, you know, Josh <inaudible>, Josh Pigford with bare metrics, like Stripe was becoming big. Everyone wants like, let's
Speaker 1 11:53 go do that. Um, but just cause he was in the space. Um, so I think that's, yeah, it's massive, man. It's huge. Yeah. Yeah. And that's, and it isn't always, you know, I don't want to make it see in hindsight you can go back and look and say, Oh well I did all of these things and man I'm such a smart person because I took advantage of this situation here. And it's like that's all bullshit. The truth is in the moment you don't really know you, you get hunches, you get feelings, you kinda somethings like, you know, pulling at your gut saying, Oh maybe you should want to do this. And that happens. Even with the things that don't work out, you know, I'm just, there's a certain survivorship bias to my decisions at this point where I say, Oh well these decisions worked out well.
Speaker 1 12:35 You don't really know about the, you know, two dozen other decisions that I made that, you know, didn't do shit or they didn't, they just flamed out massively and they move the needle in no way, shape or form. You know, you have to, you just have to basically be ready for when an opportunity comes up. There's another quote that always sort of haunts me that's attributed to Edison and that is success is when 10,000 hours of preparation meet with one opportunity and you know it's trade and all of this stuff, but at the same time there is a grain of truth to this and the times that I have invested in myself, invested in the business, invested in marketing or sales and just gotten myself to a point where I know that I can actually capitalize on this when it comes up and then that thing comes up, you're ready to hit on it.
Speaker 1 13:30 There have been times that I was not ready and something came up and I tried to capitalize on it and it was a massive failure. I mean it just, you stumbled, you fell bloody nose, scraped base, the whole, yeah. You know, like I can remember specifically last year about this time, there was the whole snafu around MailChimp and Shopify and you know, I was looking at that going, I have an opportunity. But the truth was I didn't really have that good of an opportunity and I also wasn't really prepared to take advantage of it because I hadn't been positioning recapture as the mail Chimp alternative. So then I clumsily went out there and tried to do exactly that. I tried to position it as the mail Chimp alternative. I tried to explain why recapture was better than MailChimp. I tried to run paid ads that went out there and push this stuff.
Speaker 1 14:20 I got a handful of installs but it did not move the needle. It was not the right opportunity and I was not prepared for it. So you know, it's very much one of those things like you've heard other stories where you know you have two really strong competitors and then all of a sudden one of those competitors just massively fucks up and the other competitor just gets tons and tons of customers jumping ship because the second competitor screwed something up. That's just fundamental to the whole business model and really pissed people off. You know that didn't really happen with MailChimp in this case. I tried to make it like that was the case and I wasn't, you know, I wasn't even on par with MailChimp on a lot of things there. So it was just a bad fit. And me trying to put a square peg in a round hole and you know, stuff like that, you, you have to be smart enough to recognize you're not ready to do that yet. You know, I was not smart enough to recognize that. I just, I tried it and it failed. And you know, I probably burned $600 on ad words trying to make it work and it just, yeah, it was a massive, massive face plant.
Speaker 2 15:23 You know, the, the, the thing about like looking back at the end of the year like this, that they'd always kinda like surprises me and kind of makes me mad as, as like, uh, realizing this like we are now. Uh, and then it always makes me think like immediately, like, what else am I missing? You know, like we, we talk a lot like internally about like, Oh our app is so much better than it was and we are so much smarter than we were. And then it like really gets us scared about like, uh, what, what do we still not know that we're fucking up? Like right now? You know? And like what, like what are we building that's wrong or what, what about our engineering process or a marketing strategy is just wrong and we don't, we don't know. And I think that's like, you know, a lot of this is like doing the best we can with incomplete information.
Speaker 2 16:14 But I think that's the thing that really scares me the most is like we know a lot more now than we did a year ago or six months ago or a month ago, but we still are, are nowhere near like where we need to be in terms of like really, really, really, really understanding all this stuff. And I think that's like, that's like on a really metal level. Like the thing that I worry about a lot, and I think we have a lot of things in place in the business to try to do better with that. Like, we're doing development team retros now, um, after every kind of development cycle. And I agree, development process is a ton better than it used to be. And so we're shipping better product faster than we were before. And so like, I feel good about that, but it's almost like this process that we're trying to put in place to make sure we're learning and that like, what we're learning is getting implemented in the business. You know, like it's all those things together. I think that's kind of what you're talking about too, with, with like the luck surface area and being ready for these changes. It's like if you don't know how to get ready for that and put a process in place for yourself to realize that there's no way that you're going to be ready to, to see these changes and actually do something to implement and, and capitalize on them. So, I don't know.
Speaker 1 17:25 Yeah. And, and I just had an insight that, uh, I'm going to deflate your balloon a little bit about, you know, the whole bean smarter and better thing. So yeah, I mean if you spent 12 months and you're not smarter and better than you were 12 months before, well you're fucked. And, and furthermore, your competitors assuming that they are reasonable and also intelligent, also driven, are doing the exact same thing. So where they are 12 months later than when you last did your baseline point, they're also going to be smarter and better. So each year it's not like it's getting easier. You're smarter and better. Didn't suddenly put you ahead of your competition if they're doing the same things that you're doing in terms of like trying to improve themselves and be introspective and focus on what can we do to better serve the customer, then you are just staying even with them.
Speaker 1 18:23 So you've got to, you know, figure out where can I go that they are not or what are the like this, this is the thing that Asia was getting at, right? With a 10 X move, you've got to find a move that's going to move the needle in your business in a significant way that isn't just diddling around with little tiny stuff. Yup. Yeah, and so that's, that's the thing, I think that's changed my thinking the most this year and Asia puts some great words around it and thanks again for coming on the show Asia if you're listening to this. But you know, that's when I was looking at what were the things that I wanted to do in 2020 those were the only things I really focused on specific partnerships and integrations that I thought, okay, if this is in place, here's what kind of an impact that's going to have in terms of customers I can bring on board and what I can do.
Speaker 1 19:15 And then secondarily to that was looking at all right, what are the features we can add to the platform that are the ones that the customers want the most? Because it just, the reality of it is you can add 12 new features a month for the next year and unless it was the right features or unless those features put you so far ahead of your competition, it isn't going to push you into the $200 a month tier because your competition is probably doing something similar to that. You know? And that's the reality, especially me, I'm so far behind on my competitors compared to their features. Like depending on what you sort of compare me to, I just realized the other day that I've been like lumping myself in with two groups of competitors that are really distinct and one is like the general email marketing crowd. So that's the Klaviyo's and the drips and the converse CEO's and um, gilts and other things like that.
Speaker 1 20:12 And then on the other hand, there is a category of like highly specialized abandonment only apps. And recapture is kind of straddling those two worlds because I'm not just abandonment. I do have some other things, but we're kind of like focused on what are the things that will only drive revenue to your eCommerce business. So it's stuff like, you know, review reminders, which will increase your sales and win backs, which gets you more money to bring back your existing customers. But we also have, you know, strong abandonment stuff and then email popups to help make sure that you get those abandonment people in there. Well, that was an insight. I, I, you know, in, uh, in looking at this now, I'm like, why didn't I think of this before? Like this was sort of obvious. Uh, but it's not that obvious until you sit down and think about these things strategically.
Speaker 1 20:59 But the reality is now I'm left with a dilemma. Do I want to continue trying to straddle those two worlds or do I really want to like hard go down one path or the other? And if I go down, if I go down the email marketing path, I'm already behind the eight ball. I'm way far behind compared to almost all the others. So then what differentiates me from them aside from the fact I have less, perhaps not a great, that's a bad differentiator. That's a terrible differentiator. But that if I go the other direction, is that something that people outgrow more frequently? Because I still see a shit ton of installs on all of these apps and the number one app, this is going to surprise you. Guess what the number one abandonment app is? Oh, I have no idea. Pay pal marketing. Come on.
Speaker 1 21:52 Did you even know that PayPal marketing existed? No, neither did I until I actually joined the space. I'd never heard of them. I've never seen them installed. I've never observed their product in the wild. Yeah. But it's interesting. They are the most installed, the most used and they have a pretty steady membership. So you know, the question is, you know, we pay pal is a shitty vendor. Let's be, let's be brutal about this here because of all the payment vendors I've ever worked with, you know, and I've worked with probably a half a dozen at this point. PayPal is definitely down on the bottom half of that cohort. No doubt. Yeah, their API sucks. Their customer service sucks, their user experience sucks. The payment, just the whole payment experience sucks. It all sucks. And the only reason that it gets used in my opinion is because it's so God damn popular thanks to eBay.
Speaker 1 22:46 Yeah. And as a result of that popularity, you're forced to integrate with them even if you don't want to, even if you hate them and you know you have to suck it up. So the, the PayPal marketing solution is there, is there an opportunity there? So I'm, you know, that's one of the things that I'm thinking about right now is what strategic opportunity can I get out of trying to position. Oh, and by the way, the whole notion of this positioning, the reason I started thinking about this is because I finally read obviously awesome April Dunford. Yeah. Great book. And we should probably have April on the podcast at some point because she's got some really fantastic special massage. There's also a lot of people after our last episode, a yes, yes. And I think that's a no brainer. And she also has a new mentor at tiny seed.
Speaker 1 23:35 So I joked on Twitter that a, she's probably the most popular mentor, uh, this coming month here. But you know, that just going through her book, thinking about the questions that she poses there about how to position your product was what made me realize I didn't understand my own positioning that well and therefore what category I fit in and what people think I fit in. So that was what spurred that thought process. But you know, plug for April's book, if you haven't read, obviously awesome, then you obviously need to do that because that's the most obviously awesome thing you can do for your business right now is to understand your own position. Um, and you may think that you understand positioning. I thought I got positioning, I didn't really get positioning. And this, even if you get positioning, this is still going to give you a great set of tools and, and questions that you can rethink your positioning on. Because just like your pricing, you know, you can't just set it and forget it. You have to, you have to revisit it every now and then and see, am I still in this space? Are these still my competitors? Is this still what I'm doing for my customers? This is why people buy from me. You know, those are, those are great things to think about. The book is very nuanced. I agree.
Speaker 2 24:43 I read it a couple of months ago and I mean it is the kind of thing where you need to sit down and go through the process that she talks about. Cause it's not just, you know, yeah. How do you, how do you compare it to other people in your space but you know, from the ground up, like kind of who are you and what are you about and um, what do you wanna what do you want people to think of you about? It's just, I mean there's, there's so much where we, I can't do it justice, um, in this kind of episode. But yeah, we'll definitely have her on in the new year to talk about, uh, you know, her book and the exercises there. You know, Dave, I think like to round out, I think that something we all have known for a long time and really appreciate and value but, but maybe like take for granted or don't know when it's that good is like the community that we're all a part of and how and how valuable other people helping you is.
Speaker 2 25:33 And so like the most obvious freaking thing ever. But like I like it's gotten kicked up a notch for me this year with the tiny seed group you mentioned April is as part of the, the tiny seed um, mentor program. I mean we have access to anybody you would, you really want to talk to you like at any subject matter in SAS or marketing or running a business, there's somebody there that you can, you can call within a week and like to, to have access to that caliber of people. And that range of expertise whenever you need it is, is massive. And this is not a, an advertisement for tiny seat. I mean it's been a tremendous experience for me as a business owner, as an entrepreneur. But if you can get that somewhere else, then then get it. And if you have to pay for it, that's cool.
Speaker 2 26:22 Um, but, but getting really, really, really top notch coaching and guidance and mentorship and I think I'm talking about like a level up from this podcast or from your mastermind group or whatever. And those are all great things and I hope we're delivering some value here, but I think something where you can talk to somebody that is 100% been and done that before. Um, and they could just tell you exactly, you know, Hey, do this, don't do this. This is you're stupid for going down that road. Uh, I mean, you just, it's such a high leverage thing. You're saving yourself time and effort and pain and everything and in return giving up whatever, you know, a small percentage of company or you know, a couple hundred bucks to get 30 minutes with, you know, somebody on clarity.fm or something like that, uh, is, is massive. And I think that it, for me, it's kind of like takes community up a notch when you're able to tap into this quality of resource, I guess.
Speaker 1 27:18 Yeah. Yeah. Most definitely. Having a, just a sounding board, somebody to bounce something off of is always valuable, but that targeted expertise can make a huge difference. And you know, I will say, so I do have one critique about April's book and it's really not a knock on April or her content per se, but it has to do with her experience and the perspective that she's writing from in the book because she comes from a lot of big companies. She used to work for IBM and she talks about her positioning that she was doing with the DBT team in IBM. And you know, you're looking at that and reading through it as a bootstrap strapper and she's talking about bringing in all these product owners and these sales teams and the engineers and you're like, I, I am all of that. I don't have a team to bring in.
Speaker 1 28:05 I can't talk to anybody. And if I talk to myself, which I do all the time, people just to let you know, they look at you a little strange, but it doesn't really give you that perspective. It doesn't give you a variety of perspectives is what I really am trying to say to, to be able to, you know, say, Oh well maybe we should try this and do that. Because otherwise you kind of get stuck in your own head and you stuck in one way of thinking. So the one thing that I would really love to know about April's book is how we can work with that from a bootstrapper perspective because you just don't have the same number of people that are involved. And so, you know, when we bring her on the podcast, that's going to be the question I asked her. Yeah, that's it. I'm not asking her any other questions. Just that one. And then just drop the mic and walk away and we'll just drop the mic and walk away. No, no, no. It won't be that line. Sorry.
Speaker 2 28:56 Uh, but no, I think this is a, this is a good time to, you know, to, to ask folks out there, uh, you know, if they have, you know, things that, that they've learned throughout the year that they're putting into place next year. Um, and or things that they would like to hear more from us about. Kind of to bring it full circle back to what we don't do at the beginning is, you know, we do this show not for ourselves. We do it for everybody that listens and, and this community that I hope we're building here. And if there are things that, uh, that y'all want to hear about or don't want to hear about or people you want to have on or things that you want, Dave and I to talk more about, let us know policing cause that's, that that makes us better in this as a product, uh, and a resource for everybody better. So please let us know, shoot us a message podcast@roguestartups.com uh, or drop a comment in the post for this episode and happy new year again, everybody happy new year.
Speaker 0 29:48 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>.
