Episode Transcript
[00:00:00] Speaker A: Foreign startups. In this episode, I'm chatting with Jordan Gall from Rosie. Hey, Rosie.com Jordan is building in the AI space and as we continue this theme of AI on the podcast, I wanted to have Jordan on to talk about the realities of building an AI native platform, what that means from like a risk perspective and product and fundraising and velocity, how he thinks about like the, the kind of time sensitivity of everything in the business and building this sandcastle that we talk about and what are the benefits of that, of being in a kind of rising tide and what are the risks of that and how is he managing it? We talk a lot about how he and his team are kind of AI forward and AI native as, as users, but they're selling to a non technical audience. And so what does that dynamic look like as well? Hope you enjoy this conversation with Jordan Gall.
Hate us anyhow. Right? So glad to drag you back into the arena.
[00:01:07] Speaker B: Yeah, it's good. Get warmed back up.
[00:01:09] Speaker A: Yeah, yeah. Okay. So like, Jordan, I want to start with, like, a lot of us are consumers of AI, right? Users of ChatGPT and Claude and Deepseek now. But you're like building there and this is somewhere that I think is dangerous. I don't know, is dangerous the right word? How do you feel about like building an AI tool? AI wrapper tool. Yeah, for lack of a better term.
[00:01:33] Speaker B: I don't know if dangerous is the word that comes to mind, but paranoia seems to be necessary. Okay, you, you, you have to be humble and paranoid, right? You have to be happy that you're building in a space that's hot, that there's real demand, right? That that's actually the most important thing about AI, that, uh, people are signing up and using them. Uh, but you cannot assume, right, if, if you're OpenAI and you're raising, I don't even know how much money they've raised now. An enormous amount of money. They need to be par. Paranoid too. So you and your like, little startup should probably keep an eye out and not get all, oh, well, we're at the app layer, so we're all good. Like, not really. No one's all good.
[00:02:13] Speaker A: Well, what are like some practical things you're doing aside from like moving really fast, which I know like, you, you had raised some money, you know, previously, and you kind of like pivoted that money into Rosie, so. Sorry, Rosie is automated phone call answering and appointment scheduling for service businesses.
[00:02:30] Speaker B: Yes, that's right. Rosie creates a new option in the market for small businesses, whereas the only way to Handle phone calls, especially when you weren't working, or during the day, was either voicemail or human powered answering service. This now creates a new option in that market where an AI can answer the phone for you, take messages, send them out, call transfers, emergencies, all that stuff. So it, it creates a new option for small business owners.
[00:02:59] Speaker A: Yeah, yeah.
So back to like, paranoia, like practically, what, Aside from moving fast, like you'd raise some money, like, y'all move very fast and like you're, you're a really good executor anyhow. But like, aside from trying to move fast to kind of capitalize on the opportunity while it is in its current phase, that we understand, like, what else are you doing to guard the business against some of the risk?
[00:03:27] Speaker B: Yeah. So there's a few things. Internally, we insist on making adjustments to be more efficient. So Rosie came out of my previous company. It's the same company, actually, just different. Product Rally was an E Commerce checkout, and that required more people and more sensitivity around deployments because in E Commerce checkout, if anything goes wrong, you're costing people money immediately. So when we, when we made the adjustment and pivoted to Rosie as a product, we like, insisted that we also drink the Kool Aid, that we say, well, we're going to get leverage in our customer support, in our design, in our development process. So we feel like we have had to make an adjustment and have learned a little bit along with the way we want people to learn about our product.
But there's still a very clear separation. You're a software company and you gotta do software company things. And the people that buy from you are not software companies. They're just business people looking for solutions. So that, that feels very much the same as it used to with any other product.
[00:04:35] Speaker A: I want to, I want to talk about, like, you use the word leverage. I assume you mean kind of like using AI for yourself to be more productive.
[00:04:43] Speaker B: Yes.
[00:04:43] Speaker A: We don't need your team doing.
[00:04:45] Speaker B: Right. It's like, when should we hire for support? A lot longer than we think because we could get leverage out of, you know, Intercom's FIN tool, for example, we use for the Tier one support is actually very good and has allowed us to avoid hiring in the support role.
[00:05:00] Speaker A: Yeah, yeah. What are you doing as a founder to. To kind of do. To. To leverage this. I just listened to my first million with Andrew Wilkinson and it was like, ah, you know, I learned a couple things but like, would love to hear, like, what you're doing.
[00:05:13] Speaker B: I'm not really personally obsessed with, with like efficiency. I'm just not that type to begin with. I have found myself increasingly adopting ChatGPT as my go to for a bunch of things. So I use it, but I don't, I feel like I don't really overemphasize it. The truth is, being a non technical CEO, I actually sympathize much more with our customers and it's almost like I view our team in the same way as they do, where it's like, I don't really understand what you're doing. I don't understand this magic. I don't know how any of this works, but I know it is improving my business. So it's almost like I view our engineering team in the same way that our customers view our software company where they're like, I don't know how any of this works, but I do know that on Saturday morning at 10am When a phone call comes in. A few weeks ago I felt the need and the pressure to take that phone call even though I'm with my kids in the morning because I don't know if this is a $3,000 job that I'm trying to close for my business. And now all I know is Rosie answers, it sends me a text message and I read the text message and I know what the message is about and I get to make the decision on whether or not to call them back.
[00:06:26] Speaker A: Yeah, right.
[00:06:27] Speaker B: So that's, that is the user point of view. It doesn't really matter to them what stack you're using, which model, and that we have taken as a general philosophy in how we're building the product. If you go sign up for some of our competitors, it's like, you know, literally one of the first things you see is which model do you want to use? And we're like, nobody cares about what model. At least we don't want them to have to care.
[00:06:50] Speaker A: Yep.
[00:06:51] Speaker B: So it's like point of view.
[00:06:52] Speaker A: Yeah. Cool. So, so like we, we are looking at AI a lot in internally and we, we kind of, we talk about it like Team Pink and Team Purple, they're like our, our colors. One is like intern we use to make ourselves more efficient and the other is like externally. What can we do for our customers to introduce AI to them? I think the internal thing is everyone has their flavor for it, everyone has their Chateau d'you Claude or it's this email tool or the developers have all their preferences. Largely we just let them kind of run with it. I think externally one thing that we talk a lot about is if we rewind six months, it's easy to say, like, let's just slap a chat bot on top of our tool and call it AI enabled. But increasingly, like, what we're thinking is like, the real value that we might have with AI is like helping our customers understand their own data more rather than, you know, like this kind of like weird chat layer. So like, we're a podcasting company. You can imagine saying like, hey, you've done 300 podcast episodes, but you've never talked about this thing. Or when you have episodes with this guest, they always do better. Or when your episodes are 25 to 28 minutes, they perform better. Are you guys looking at anything like that to say, like, hey, it's not just like the answer the call and then they send you a text or something, but like, Rosie can give like business insights to your customers or are they like not even thinking about that yet?
[00:08:19] Speaker B: We're probably thinking about that more than they are. So, okay, so here's, here's the difference, right? If we take a step back, go, go six months, you know, go six months back in time and, and we've got some money in the bank. I don't like the way the checkout product is going and we decide to pivot in that moment, we, we had to make a few very clear decisions. One of them was that we wanted to build something in AI that was not possible without AI. I don't know if you want to call that AI native or whatever that term is now. The reason for that is I, I mentioned briefly the third option that Rosie creates in the market. So at the macro level, that is what's happening in a bunch of different markets. The US economy, the world economy, software economy, is pretty built out. There aren't that many large scale problems that don't have any solutions. Any large market has a bunch of solutions. And if you want to compete, you got to dive into it. The thing that's most attractive about AI from a software like founder point of view is that there are places in the economy now that have very large problems, but the solutions simply weren't possible. And that space is going to be filled up pretty quickly. And just being inside of that space as it gets filled in, you get a lot of benefit. It's a little bit like, I don't know, cheap mode or easy mode, whatever you want to call it. But the companies in our space were all growing because it's a solution that literally was not possible. But it's a very large problem. So going in, I Didn't want to build anything that could be.
The way you're talking is established software companies and other companies look at AI and they say we can use this to improve our product and add more value to our customer. That is a very different thing, a different approach, different, you know, game. Then I'm going to build something that wasn't possible a year ago.
[00:10:20] Speaker A: Yep. So cool, Cool. Okay, how like going back to that decision time, right? Like what was it about this market and this opportunity that you liked?
And like, you know, I look around and I'm like, what about this? Or what about this? Or what about this? Because we, I mean we think about building another product because we're pretty mature product and we're like, we got a lot of shit going on over here. Like, can we just have another thing to sell to our existing customers? I don't know how to think about an AI native type product to sell to our customers because I, you've, you've done it, you've gotten through like that decision making. Tell me about how you evaluate the market and the opportunity.
[00:11:04] Speaker B: Okay, okay, so, so I had like, you know, a little list of criteria. One like a native and not like it, like an add on thing. The other thing I really wanted to make sure we got is that we built in a category that was currently not good.
I want it to be bad because a lot of things around AI, you're making assumptions about the future that you can feel pretty comfortable about. For example, your cost of goods sold, it's going to go down. It's a decent assumption to make. You're not taking that big of a risk there. So one of the things I liked about voice was when we looked at it six months ago, it was not good.
And so if you look at that, you just kind of squint out into the future. You know, it's going to get good and then it's going to get incredibly good.
[00:11:50] Speaker A: So building now from a technology and solution perspective, you mean.
[00:11:54] Speaker B: Yes, yes. If you call Rosie right now, it's pretty good. Six months ago it was not nearly as good as it is now. And a year from today, you are really not going to be able to tell if it's a human or a robot. My assumption is actually people are going to prefer robots.
[00:12:10] Speaker A: Yeah.
[00:12:10] Speaker B: Because of the reliability, the consistency, the ability to turn the phone call into a text message instead and switching languages and I mean, you know, robots are gonna be better at that. Humans are still gonna do things that only humans can do. But this washes away a lot of the stuff that a person just does need to do, Looking up my account information, how much I owe you, and taking a pain. Like, a person doesn't need to do that. It's a database. It's a database.
It's funny. It's like a. When I first learned about voice, again, not being technical, I was kind of amazed by how simple it is. It's audio turned into text sent into a language model turned into text turned into audio. It's like, actually not that complicated.
So this is also a way to talk to databases, but audibly.
So that was important to me. Something that was not good. When I looked around at the competition, I was like, oh, I see what they're doing. They're just getting in the market and starting to build now in anticipation of as it gets better and better and the word of mouth gets better and better. Right. Like, what I told my investors when I was like, hey, we're going to pivot to this totally new thing was sometime in the next two, three years, there will be a million small businesses in the US that use. Using something like this. And if we jump in now, we become a leader, we can have 100,000 customers. So, yeah, it's a big opportunity.
[00:13:29] Speaker A: Yeah. Okay. So, by the way, like, preferring robots, I wrote an OEMO in December.
[00:13:36] Speaker B: Okay.
[00:13:37] Speaker A: Amazing. Amazing. Yeah. Like, I think about, like, I would buy. I would buy one tomorrow if I could, to send my kids to their sporting events and stuff.
[00:13:45] Speaker B: I like that it drove.
[00:13:47] Speaker A: I'm like, I consider myself a very good driver. Like Rain Man, I'm a very good driver.
It drove perfectly, like, for like a 45 minute in the city thing. And like. Yeah, that's a trick. Yeah. Anyways.
[00:13:59] Speaker B: Yep.
[00:13:59] Speaker A: Yeah, I hear you. Okay, so. So that's like on the solution side, on the market side, like, what. What was it about, like, service businesses.
Not super technical.
[00:14:11] Speaker B: Yeah.
[00:14:11] Speaker A: An AI resistance market. Right. Like, AI is not going to kill the plumbers. Right. Like, what. What was it about that, that you. You liked the customer?
[00:14:18] Speaker B: Yeah. There's a little bit of, like, playing, you know, both sides of the bet there.
[00:14:22] Speaker A: Yeah.
[00:14:23] Speaker B: Whereas AI is definitely going to kill a bunch of things.
Or at least I'd never.
[00:14:29] Speaker A: I'd never build what you do for accountants. Right. Because accountants are just going to go away. Right. Like.
[00:14:34] Speaker B: Right. Or a lot of markets are going to be disrupted more than others. So it's like selling AI into markets that are pretty protected from AI felt like a good bet in general.
Um, a lot of the decision making around that is Directly a response to my previous experience with Rally. So one of the things I wanted to do. This still sound familiar to you? Cause we know each other. I did not want a platform to be dependent on no platform. Daddy, don't tell me what to do, what I can do, you know. So that was really important to me.
And I did not want to do the enterprise sales process. I wanted self serve.
And then as we got further into it, that started to become like a North Star from a product point of view. The North Star was I went to the team and I said, we are selling to people who are not technical and we are selling a very new type of a product. And the way I want us to think about the product is prepare it to onboard 100 people a day.
If you have that in mind, you immediately can make assumptions on all your constraints. Can't talk to everybody. Gotta be simple, you know, can't be complex onboarding, can't be complex execution. All these different things just kind of fall into place as a set of assumptions. When you say, can 100 people a day do that without talking to us? If not, then we're going in the wrong direction. So these, a few things. Self serve market. No, big platform, big market. You know, all those things helped all the, all the smaller decisions that come after, like pricing, like trials and so on.
[00:16:17] Speaker A: Yeah, I want to talk about pricing for sure. I have a question about.
We're having some work done in house right now and I knew we were having this conversation, so I thought about you a couple of times. When we had electricians coming over.
[00:16:29] Speaker B: We.
[00:16:30] Speaker A: Had an electrician called the other day. Hey, can you come by and give us a quote on this thing? He's like, where do you live? I give my address. He's like, oh, I know that street. Is that like on the. Do I turn right or left coming up, you know, the cross street. I was like, you're not going to put this in gps? Like he just knows our town and knows where we live. I was like, holy shit. And then like doesn't write anything down. He just like, he asked me to text him something.
And I'm thinking like, our customers at Castos are like reasonably tech savvy.
Did it scare you to get. Did it scare you? And what is like, implications of dealing with like not tech savvy customers?
[00:17:08] Speaker B: So there are, there, there are implications. You know, what is the. Pricing is the most common question inside of our support chat. It's literally. The pricing page is just literally right at the top. Right. So there are Just things like that. Fine. Now what it does make you do is it removes marketing fluff. You can't make these crazy promises. These people do not have time to waste. They're like literally in their truck on their phone signing up for your product.
[00:17:39] Speaker A: Yeah.
[00:17:40] Speaker B: And that, that forces you to, to, to provide them something that they really care about. Because if they really care about it, they will deal with whatever hurdles they need to deal with.
So our churn is shockingly low. When I did my projections, like for the board and for ourselves, I assumed a very high churn rate because I'm like super technical AI product for a non technical audience. It has shocked us how low it is because what I described there, Saturday morning comes around, your phone rings and you're with your family. That is so painful and such a great thing to relieve that a non technical person. They're just going to deal with some hurdles. They're just okay with it. They're just like, you can hear it in the way questions are phrased in support. They just want this thing to work. Help me. I want it to work. I don't want to quit, I don't want to stop. So that felt like, oh, we're addressing something very painful and that gives us, it gives us some room for error.
[00:18:46] Speaker A: It's not surprising to me that churn is low. I would suppose that like trial to paid conversion, it also kind of suffers though, right? Because they haven't gotten to that value point yet and so they're not sticking around. You don't have to say. But like that would be the crux to me is like if they haven't experienced the value, then the technical bits are harder to get over.
[00:19:09] Speaker B: Yes. Okay, so this is probably my favorite part of software. So let's get into this stuff.
The way we approached it, the way I broke it down is different parts of the acquisition funnel. And I basically told the team, like when we did all hands, you know, the, the company update and then like agenda and then the first slide would be we are here. And it was, it was basically the, the steps of the funnel broken down through like philosophically, right? Like, like customer acquisition, trial, conversion, conversion to paid. Oh no. Activation and then conversion to paid and then retention. Right. So I would just bold and highlight one and say we are here. We do not care about the next ones. It doesn't matter what our retention is. We got to get this thing done first.
So by focusing on one step of the customer funnel, we, we were able to just kind of zero in and identify mistakes that we were making quickly and then adjust and adjust. Experiment, experiment. And it has been. It has been a. That has been extremely satisfying because it's similar to like an e commerce funnel, where you're like, your advertising needs to be right for the audience. The. The product page need to. The price needs to be good, the card needs to be good, the checking to be good. And then they convert. But once it clicks, then. Then it starts to fly.
[00:20:25] Speaker A: Yeah.
[00:20:26] Speaker B: So going one at a time has been a very satisfying journey. And most of it has been focused on exactly what you mentioned. How am I supposed to know if this is good if I can't try it? So what did we do? If you go to heyrosie.com right now, we give you a little bit of that wow factor. But before you need to create an account, so the funnel is split. Part of the onboarding funnel is on the marketing side, not on the app side. So you come in, you click the cta, and the first thing is give us your business, a Google business profile. So you put in your business name, Pest Busters. It finds you and you hit click. And then the first thing it does is it creates two clips for you so you get to hear your own AI agent. On the marketing side of the funnel, you have not put an email address. You haven't created an account. Only then once you hear those two clips and you're like, damn, Rosie knows Pest Busters. She's offering to take messages. It's customized. It took 10 seconds. Now I have enough desire to create an account.
And then once you create an account, then you get into the onboarding. So, like tweaking that and moving that around was cool. And then of course, the paid and the credit card and usage and all that stuff has been interesting.
[00:21:48] Speaker A: This is my favorite, right? Like, this is my favorite customer acquisition thing, or conversion thing in your case, maybe is like showing the thing as lead gen, right? Or like conversion generation or whatever. Like working with a couple SEO people and like, they just send SEO reports to prospects like, your shit's broken in these ways or your page speed sucks and so your E commerce site is not converting like it should.
[00:22:13] Speaker B: Yep. We looked at Ahrefs, Ahrefs and all those because they do an incredible job of it. So we looked at all those for inspiration. And then the next thing we did, you know, all of us who have software experience, we want to apply the lessons that we learned. And what worked for us and what worked for us at Cardhook like two companies ago, was force the credit card up front. Make people show their seriousness. And, and that worked. So we tried that with Rosie. So you would come in and you'd put a credit card on file and then we would give you a seven day trial. And you know what happened? Everybody converted. We thought we were so smart because people come in, they're super excited about this AI product. They put their credit card on file, seven days goes by bang, 49 bucks. We another conversion. But then you look at the usage and everyone churned. Most people aren't using it. So we were like, oh, we're building our castle on sand right now. What we should do is take a big risk. This is probably the biggest risk we took and something very important that I think we did or we would regret it. We switched from seven day trial time based to 25 minute. First we did 50 minute. Later on we moved it down to 25 minute. But usage, and what that meant was the only people converting are activated users. And that allowed us to focus on the activation part of the funnel. Really hard.
[00:23:36] Speaker A: Yep.
[00:23:37] Speaker B: And then we knew what that would create was a few week gap where all of our conversions would disappear because the time base no longer is in effect and then people are coming in and they haven't gotten that much usage. So that was a sweaty few weeks of oh, you know, where is this going to go? And the hope was all that usage was eventually going to cascade into a bunch of conversions and right around middle of December it like hit. And that only then did we feel confident that we had made the right decision. And now the reason our churn is so low is because 100% of the people who convert are activated using users. So overall you have a lower conversion rate from trial to paid, but everyone's using the product and happy.
[00:24:21] Speaker A: Right, Right. And if you're, you're basically giving them freemium. Right. Like unlimited free trial from a time perspective, you can market to them forever.
[00:24:29] Speaker B: It is. What do you, I don't know what you would call it because we originally thought, hey, maybe this goes freemium and there's a free tier. And what we're doing right now, I think it's a usage based trial more than freemium.
[00:24:40] Speaker A: Yeah, yeah, yeah. I just mean like for us, like we have a 14 day trial just because I don't think like usage doesn't make sense as much for us.
But like, yeah, we could market to folks forever after they fail the trial, but if they're still able to use the product, it's just a different conversation, hey, come back in, blah, blah, blah, your account's still there.
Cool. So we're experimenting with some paid acquisition stuff right now. Eight years into the business, finally figuring some of it out. And it's amazing, it's amazing what it's done to our trial count. Like, we're just at like, we're seeing conversions, but still trying to figure out that very first part of the sequence like you were talking about.
I know from advising some tiny seed companies that in the kind of home service business, paid acquisition works really well.
One of the tiny seed companies, you know, works with contractors, like construction folks, and they, they, they, it's a very direct funnel where, where they just have like lead forms and they book a call and they call the guy and he's in his truck on the job or whatever and they're like doing this kind of stuff. I, I guess what I'm, what I'm getting at is like, that's a sales process and if you're running ads, it's to a trial. How are you kind of bridging that like physical gap from like this guy, see if you're running ad thing on the phone, he's got to come and do this thing that maybe should be better on the computer. Like, is that, is that an issue?
[00:26:19] Speaker B: Yes, yes, it's an issue, but it, it isn't, it isn't having that big of an impact. There are definitely people who want a call. Like, we have a Rosie number on the website. A lot of people call it and like, can someone on your team call me back so I can talk to them? So that's definitely happening. But that's a, that's a minority of the trials where we started was cold email. I just thought, okay, this is the most straightforward way to just go out and touch 500 people a day. Because we needed beta users, like, we had nothing.
So we did cold email. And that just got us into conversations and it helped us understand the market and what people want, what they care about. And then we transitioned over to paid advertising.
[00:27:02] Speaker A: Yep.
[00:27:03] Speaker B: Yeah, meta, Facebook, Instagram reels, video based, some, some graphics also.
But it's almost like we, it, it feels like consumer advertising because our audience are small businesses and that's basically the general population. It's basically everybody on their phone during the day. A lot of people are involved in small businesses and one of the benefits that Rosie has in general is when you see it, you get it. There isn't that much explaining to do. It's, you know, I hate getting into the office on Monday and seeing 14 missed calls and only one person left the message because nobody likes voicemail. So I found Rosie AI. It's kind of like, you know, there's not much explanation. Do you get it?
[00:27:52] Speaker A: Yeah, yeah, yeah.
[00:27:53] Speaker B: But that is working and it has helped us grow, grow to our like initial, you know, initial revenue. And now the challenge is, okay, I don't want to be dependent on advertising 12 months from today. So what do we need to do now to start diversifying our acquisition and ideally bring down our, our cost to acquire, you know, individual signup?
[00:28:18] Speaker A: Yeah, I mean, I think that's a good question. Like, I, I don't, I don't know the answer. Right. Like we, we have been an SEO driven company because we're, we're self serve too. We're $19 a month, not even 49. And so like paid has been kind of out the door for a long time.
But like the right, it's not even the writing on the wall. It's like the fucking door is slammed for me from, from like an SEO, pure SEO perspective, which is why we turned to ads. I was like, we just got to make this work. Like this is kind of our only option. I think the only other option is video content, you know, so like a bias, of course, but like podcasting, video, YouTube, I think again, I know I'm biased, but like I think kind of what AI has done to SEO leads more people to something like YouTube or podcasting and maybe social if you can, like organic social if you can make it work.
But man, it's so hard. It's so, it's. We're a media company is so hard. I mean this, this is easy because we're friends and we're just bullshitting, but like to, to really do it well is so hard.
[00:29:30] Speaker B: I agree. You know, a few months ago, at least at rally it was, I was puzzled, like B2B software. I just didn't even know what worked. I was like networking, luck, word of mouth, some content. It was like everything just felt like it was just screaming into the void. You launch on the blog post, nobody cares. It was really challenging in that way. So I feel very lucky that advertising is working to get the initial growth.
I do think SEO is important to us, so we are investing in SEO significantly.
I think our market will be much slower to be impacted by AI and how to find things and that sort of thing. I think for a while people are just going to be searching stuff online and finding it. And I had a, I had a very important conversation before pivoting with our friend Justin McGill and Justin right. He got into the content writing AI space but before it was hot. And he explained his experience being in an AI space right before it got hot and then while it got hot and then when it became incredibly competitive right after being hot. So that wave, I think is going to happen with AI voice also. And I think we are pre, you know, hot, like right now. It's not a normal thing for a small business to have an AI answering their phone. It is just not. But over the next year, I think it's going to be increasingly popular and common and a lot of word of mouth. And we get it from our customers. Our customers are like people in the industry are calling, talking to Rosie and then texting me like, what the hell was that? You know, how do I do that?
[00:31:21] Speaker A: Yeah.
[00:31:21] Speaker B: So it's just naturally just going to grow and then, you know, movies come out. It infects popular culture. You know, SNL does something, whatever, it just starts to get into the zeitgeist. So I think SEO is going to be really, really important to go from the not hot phase to the very hot phase. And then after that is what you talk about. And that is owned media. So when it becomes very competitive, I think by that time you better have your own media ready, your own email list, your own YouTube channel, your own podcast, your own followers, people who like your brand. And that's the only thing that's going to protect you from, you know, hundreds and hundreds of competitors.
[00:32:01] Speaker A: Is the SEO you're talking about like branded SEO or kind of like keyword search intent?
[00:32:07] Speaker B: Keyword searched. Yep, yep. Traditional stuff.
[00:32:09] Speaker A: Yeah, yeah, okay.
[00:32:11] Speaker B: Right. So, you know, AI Voice for plumbers. We don't have a page like that. We need 50 pages like that. So there's a lot of like, just fundamentals. I was, have never been a big believer in SEO. I've been in E commerce and fighting. SEO and E commerce is like a pointless game in my opinion.
So I just never gave it much attention and investment. And this is, this is different. So we're kind of, we hired a great SEO firm and they're just doing like, here are the basics, here's how your website should be. Where these are the pages we're going to build out. It's going to be six months, we're going to build links. So really traditional in that sense.
[00:32:46] Speaker A: Yeah, yeah, I think, yeah, like, I shit on SEO a lot. Like one because it's self serving, because it's tells people to go start a podcast, but, but also, like, we've done it, you know, We've done it for 10 years. And so, like, we have all of the basics done, all of the intermediate stuff done. We're doing. We're still doing something. Like we're doing some programmatic SEO. How to start a podcast for agencies. Why to start a podcast for thought leadership. Like, we're doing a bunch of that stuff right now, but I think we just have like the, the, the 10% left maybe, so it's just not our main focus right now.
Yeah, the.
[00:33:23] Speaker B: Yeah, that almost feels like this, like, boring thing. This garden that you have to plant and then water for a year before you see the first signs of life.
[00:33:34] Speaker A: So it's almost like for you guys.
[00:33:35] Speaker B: Yeah, Yeah. I, I looked for an SEO firm that was really full service because I just knew I just want this thing to happen off to the side. I've written off that money for the year. It's in the budget and it just needs to happen.
And then I don't really count on it to materialize. It's almost like when that kicks in, we'll be happy that we did it six months ago.
[00:33:54] Speaker A: Yeah.
[00:33:54] Speaker B: But the focus, the day to day needs to be turned toward the owned media. Yes. Improve the advertising funnel and the conversion rate and keep that moving. And we're doing experiments. I just did like a, like a TikTok contest. There's a cool. Yeah, there's a cool company called Posted, and they allow you to just like, post a contest and whoever gets the most views wins your prize money. So, you know, I think those experiments are important. We probably have about 200,000 views, most of which are not good. I probably won't do it again, but it was like an experiment that we should, we should have these. And then I think integrations and that form of marketing will also be really important. But the integrations that we plan on doing there is an inevitable crash in terms of competition. So anyone that we integrate with is going to want to compete with us eventually. Right. So I talked to one of the. I won't shame them too much, one of the CRMs for Home Service companies, and I talked to the founder and he was like, we're going to do this, and yours is better right now. So I don't think we want to integrate. And, you know, what are you supposed to do in that situation? Well, your customer should have choice. Like, no, you can understand their point of view that they're just not going to push your product.
[00:35:13] Speaker A: Yeah, yeah.
How do you think about, like, software in general? Right. In the, in the AI era, like, I I mentioned before we started recording was listening to Andrew Wilkinson on, on my first million saying like software is less good of a business than it used to be. And I kind of look at him and say like, you know, you don't, you don't have a software business. So like what, what do you. I have a ton of respect for him, but like, I, I certainly don't think anybody is going to go around and make their own. Rosie, like none of your plumbing customers are going to go on replit and make their own version of what you guys do. No podcaster is going to go build a Castos. But is software as good of a business as it was two years ago and will it be five years from now?
[00:35:58] Speaker B: So I think the risk of people building their own software to compete with you is generally overblown. It's definitely linked to which market you're going after. If you're selling.
[00:36:07] Speaker A: Yep.
[00:36:07] Speaker B: If you're selling to software engineers that might be more disruptive than other places.
I think now is a good time to bootstrap. It is not a good time to raise money.
I think big outcomes are going to be incredibly challenging.
I think we went through an amazing time where valuations were crazy, like there's liquidity was crazy. Money went nuts like that, those, that was a really, really good time to raise and YOLO into whatever you had in mind. Yeah, I don't think that's nearly as good anymore. I think it's a great time to build a bootstrap company.
I think you can do a lot more with a smaller team now and what that really means is you don't need as much capital to start something and then you keep this optionality and you look, if you have a great two year run and you make some money and then the market changes and it obliterates your market, you know, what are you going to do? You built a nice company, you made some money, but you're not, you know, you haven't raised 20 million bucks and you need all these crazy expectations to meet or you, or you effectively go to zero.
So I think software, it's a great part of the economy. It's just changed a lot. It's, it's dealing with reality much more now than a few years ago.
[00:37:25] Speaker A: Yeah, yeah, we, but we definitely raise money like at the absolute best time, like absolute best time when we raised our additional money for Castus. Like it's, we, we will never see valuations like that again. And I'm glad we did. I, I wouldn't today with current Valuations. Like, I saw someone raise like three times worse valuations than, than we got. Yeah, that's rough. That's rough. It's.
[00:37:48] Speaker B: It's rough. We. I feel like we. So we raised money for an E Commerce checkout right when things were kooky with Vault and Festival. We did not go crazy. We raised at a normal valuation. That felt good at the time. We raised a good amount of money, and now it feels like we are.
Look, if you just look at the economics, it'd be better off. It was a bootstrap company, but I also didn't have millions of dollars in the bank to build the product and all this other stuff, so.
[00:38:13] Speaker A: Cool.
[00:38:13] Speaker B: It's a good trade off. But a reasonable valuation really gives you a lot more of a chance to succeed than what happened to some people where, I mean, if the investors are willing to, you know, give you a crazy valuation, you did it. But it traps people into a set of expectations and a bar to hit that. Now, given where multiples are in valuation, you, you, you have money in the bank, but you have a really difficult time with the exit that you're trying to achieve.
[00:38:46] Speaker A: Yeah. And that, you know, largely that's where we are. Right. Like, would be tough for us, our investors to get paid, which they absolutely will, and for me to get paid what I want because we, we haven't grown like we wanted to. So. Yeah, that's the downside of raising money.
I'll tell you though, like, from here, I have no plans to do anything but cast us, but if I did something else, I would either 100, bootstrap it or raise a ton of money. Okay.
Because I don't think the. And not even tiny seed, because tiny seed, like, doesn't, doesn't even kind of qualify, but like couple, couple hundred grand like that, that's just what I'm doing. But like, yeah, it's only worth it. I'm 44. It's only worth it to take a, to take a big shot if it's an enormous shot.
[00:39:33] Speaker B: Okay. Okay.
[00:39:34] Speaker A: Or not. And just say I'm gonna do something that can make me 2 or 300 grand a year for basically ever. And I would optimize for that. But, but nothing in between. Yeah.
[00:39:45] Speaker B: I mean, I just talked about how I think software still can be a good business, but if you put the question to me on would you start another software company tomorrow? Let's say Rosie goes away, gets acquired, whatever, something good, you know, it just gets wrapped up with a little bow. Cool. I don't think I would start on the software company.
[00:40:01] Speaker A: Yeah.
[00:40:01] Speaker B: I think the biggest, the best opportunity in the market right now for entrepreneurs like you and I. I'm 44.
Is. Is small private equity.
You take your business, know how you go out, you buy a company, you raise some equity. You use the SBA. You buy a company for 3, 4 million bucks. You work hard at it for five years, you sell it for 50 million bucks. 15.
[00:40:26] Speaker A: Yeah.
[00:40:26] Speaker B: That's how you. That's how you have a nice outcome. It is much.
It's not nearly at the same whims as a software company. It moves slower. But that, That's, I think, the best wealth generation opportunity for entrepreneurs with, like, you know, business experience. You just go in and grow a company and lead people and do all that hard work. That I think is the best way to make millions of dollars.
[00:40:53] Speaker A: How do you think about this phase of your career? So we're the same age, have kind of similar experiences.
Like, I think that the one thing I've kind of heard from, from, like, my business coach is like, you go from.
From kind of like this building and learning phase into this, like, crystallized intelligence phase. Okay. And I think that's. I think that's kind of where we are is like, I. And this sounds so, so terrible. Like, I don't necessarily want to be the doer. I want to be the. The thinker at this point in my career. And that. That dictates as much of, like, what I do for the next 20 years as anything is. Like, I don't. I don't want to build out the drip sequence. I don't want to design the landing page. I don't want to do all this stuff. I want to be the guy who, like, I know you and I know more about SaaS than 99% in business, 99% of the people. I feel like that's the value maybe that I bring at this point. Sure. Not that I can do the work.
[00:41:56] Speaker B: Yeah, I agree. Right. The other way to say it is everything you do should have leverage. And a lot of that comes from capital and from people. So doing and paying, you know, gets you a lot more. A lot faster than doing yourself.
[00:42:13] Speaker A: Yeah.
[00:42:13] Speaker B: So I feel the same way in terms of anything that you do needs to have some form of leverage, whether that's actual debt as leverage or. Well, I have. I have the ability to hire three people and lead them and motivate them is much better than me trying to do it myself. There are different phases. Sometimes you got to do it yourself and learn all this, there's nothing wrong with doing it yourself, but I agree with you that that is a requirement. The way I currently think about my phase in my career, this is just directly related to my personal situation. My oldest daughter, I have three daughters. My oldest is 12.
I want to, I want to be post economic.
[00:42:57] Speaker A: Oh, don't even.
[00:42:59] Speaker B: By the time she goes to college. Yeah, that's like, that's my goal. I want to put them through college the way, you know, without, without any debt. I want to be able to travel with them and with my wife, I don't want to have two kids in college at the same time with a third one on the way and like hustling and worried, like. So I'm really focused on just working very hard and making things happen. I, I give myself, you know, it's like six years, like, okay, work really hard for the next six years and, and make it happen. That coincides with, by the time I'm 50, by the time she goes away to school, all these other things. So the life goals, the important stuff, the travel with the kids, the fun, all that stuff along with the timing. So that, that's kind of what, what I have in mind. And I, I had this argument a little bit on Blue sky with, with Laura. Blanket on her, on her last name.
[00:43:50] Speaker A: Rotor.
[00:43:50] Speaker B: Yeah, Rotor. Because she was like, well, I see it the opposite. I'm gonna take it, not take it easy, but I'm gonna work. I'm gonna focus less on working more on my family while they're home. And then when they leave the house, I'll go back to working. And I guess I kind of want my cake and eat it too. I want to like, you know.
[00:44:05] Speaker A: Yeah, yeah, yeah, yeah. I would.
I guess I probably side a little more with Laura where like I, I, I don't want like all these like hills and valleys to, to my, like my career and my energy. Like, I want to be on this like hopefully upward sloping kind of trajectory with, with all of it and, and balance. Like probably why I won't do a thing that, where I have to raise a whole bunch of money because then I sacrifice all the family stuff now, I guess.
[00:44:32] Speaker B: But like, you know, we've raised 18 million bucks. I work from home, I hang out with kids, you know.
[00:44:39] Speaker A: No, it's cool.
[00:44:40] Speaker B: I work, but it's not like I work 80 hours a week.
I like the work. So it does feel like there's opportunity. Look in, we're just lucky in software we're doing like brain work. We're, you know, we're sitting at a computer. There's huge leverage in the ability to be remote. You get to see your fam, you know, My mom, My mom, my wife is like, can you pick up the kids today at 5:00? Because I got this other thing. So I say yes. I go hang out my kids and drive her friends to, you know, to the soccer thing. So I don't really see a problem with trying to have your cake and eat it too.
But it puts an enormous amount of pressure on, you know, hitting out of the park with Rosie because, you know, in any business, that first year, man, it is not. Not pretty. Yeah, it just takes that work to get off the ground.
[00:45:29] Speaker A: Yeah, yeah, it's funny. So my kids are like two years older, I guess, so my daughter's in eighth grade right now, and she. She tells me she wants to go to nyu.
So I'm like, fuck, yeah, that's awesome. But now I'm like, okay, casual.
[00:45:42] Speaker B: 80 grand a year.
[00:45:43] Speaker A: Yeah. 90 grand a year I gotta be paying for in four years. So, yep, yep, here we go.
[00:45:48] Speaker B: So, yeah, so I'm. I'm, like, seeing that pressure on the horizon and I. I want to take action now to nuke that pressure for future me.
[00:45:57] Speaker A: Yeah, Yeah.
[00:45:57] Speaker B: Y.
[00:45:58] Speaker A: Awesome. Awesome. Okay, so, hey, rosie.com folks, want to check it out? Jordan. Blue sky, the best place to, like, connect with you or. No, I can't believe it.
[00:46:08] Speaker B: No, I'm on Twitter. Certainly I'm on X. I tried Blue Sky. I wanted Blue sky to be like old Twitter, where I could be like, look what I made for dinner. You know, like this very, like, friendly social thing. And it's. It's just not that.
And it's just a different form of Twitter with a bit more insufferable politics, in my opinion. So I'm sticking with X.
Yeah, so.
[00:46:36] Speaker A: I. I'm the same way. I. I just find, like, there's almost no content on it. Like, I just can't find interesting stuff. I post stuff there and I follow my handful of friends or whatever, but I like Twitter because there's a bunch of shit that I just wouldn't get otherwise. Yes, that's the. That's the best part.
[00:46:50] Speaker B: I like Twitter. I contributed today to Twitter, to being good. I posted something about, like, an email campaign that we launched recently that.
[00:46:59] Speaker A: Oh, nice.
[00:47:00] Speaker B: Huge, huge roi. We just set up an email campaign that is completely focused on getting your credit card on file. So 50% of the way through your trial, get an email. Thanks so much. You're amazing. You're 50% you haven't put a card on file. Make sure to put it on to avoid interruption. Then 80% it's oh, you're getting close to the end of your trial. Then a hundred percent it's you don't have a card on file but we love you. So we gave you an extra few minutes but get it on file as soon as possible or let me know why you're not joining. Like that little email has just got the notch one notch up on the conversion paid. So I posted that on Twitter. Like that's what we used to post about five years ago, remember?
[00:47:41] Speaker A: Yeah, yeah, yeah, yeah. I definitely don't have a strategy there. I'm much more of a consumer than a creator, so. Yeah, true. All good. All right, buddy, it's good to catch up. Thank you.
[00:47:53] Speaker B: You too. Thanks for having me on. Appreciate it.
[00:47:55] Speaker A: Yeah.
