Today I ran a little experiment with doing a live Q&A (that I called “Startup Chat”) with other entrepreneurs/startups. At any given time there were about 50-60 people in the chat room posting questions, which I then answered in a live video feed.
I felt like it went really well and in the end I answered questions for about an hour. Folks seemed to really enjoy it and I’ll keep doing it each week or so until people get bored.
If you couldn’t make it, here’s the video from the chat.
Would love to hear your thoughts on the format and if you found it useful!
Alright, how is it going? I think there is actually like a 30 to 60 second delay here between me saying something and you seeing it and hearing it, so we’ll wait and see how that works out. We’ll give it a few minutes for people to trickle in and then we’ll start tackling some questions. In the meantime I’m going to sip my coffee and stare at you, so there’s that. Or I could switch it back to this, like welcome sign, and we are back.
Alright, it looks like there is about a 60 second delay, so that’s going to make the conversation part a little awkward. That’s fine now. How is everybody doing? Everybody doing good? Yes, no, maybe so. So today what we are planning on talking about, this is, I’m completely winging this right now. I had this idea Tuesday evening I think, or afternoon, and so I’d throw on some stuff together, and then just see if anybody is interested in this long-term, I don’t know. Right now I’m saying I’ll do it every Thursday but we’ll see if there is enough questions, variety of questions over the course of, as the weeks go on. There might not be enough stuff to talk about, we are good once a month, whatever it is.
Can everybody hear me? Yes or no. I’m assuming you can see me, but I don’t know if you can hear me or not, but thumbs-up everyone if you can hear me, and then we can get started.
Alright. So let’s get the party off here, so let me start recording, so that we can go back and upload this to the YouTube’s. Hello everybody, I am Josh from Baremetrics, I run that thing, which is SaaS Analytics for Stripe users. This is the first of hopefully many startup chats. My goal with this is not to talk about Baremetrics so much, this isn’t like a pitch for Baremetrics, this is me hanging out with a bunch of other startup folks, entrepreneurs, whatever people just getting started, and talk and shop.
Over the past couple of days, I’ve asked people to submit some questions and I’ll tackle as many of those that were submitted early on as I can, I have had a little bit of time to think about some of those. And then also feel free to be posting your own comments and questions as the chat goes on. And then I will probably just kind of sprinkle in answering some questions as they come in through the chat, and then also some of my, some of these questions that people had submitted beforehand.
So let’s all start it off with … So the pricing for Baremetrics, if you are not familiar, there is no free plan, there is no free trial, there is a credit card that you have to put in and you pay right when you start. So from the beginning you pay, there is not a … I don’t collect a credit card, then bill you 14 days later, you pay from the start. So the cheapest plan is 29 bucks a month, and it goes 79, then 149, the 249. And then past that there is actually a mystical enterprise section of pricing that I’m still figuring out.
So how did I come up with the prices? That’s a question, it was a shot in the dark, but also a bit of educated guess based on prior experience. So I knew what I did not want to do was build like the fast food of analytics products where you pay five bucks a month, and you get all these analytics. You can’t build a business off that. You certainly can’t build a business off that, when you’ve got a very targeted niche, niche, niche … I’ll go with niche because I’m in the south. So you certainly can’t do that when you are targeting something like SaaS companies on Stripe. Like not, we are not talking about SaaS companies … oops, somebody just mentioned that, you can’t hear me when the question is showing, so noted off except for future ones. So here is the question again.
So how did you … again, how did you established pricing for Baremetrics and have you tested other prices? So either way, so like I said I don’t want to be like the fast food of the analytics industry, so the thing is if you are using an analytics product, chances are hopefully you have a business, like you are getting some kind of value out of that. You are not like my mom trying to like track eBay sales or something like that. So you’re already by default making money here, and are using this for this pre-existing business that theoretically is making some money.
So it’s crazy to charge what you would pay for a meal at McDonald’s for some product that’s offering business value. Either saving time, saving money or creating value, i.e. printing money for people because it’s giving them enough insight, that kind of stuff, so in saying that we are charging single-digit numbers. And really the $29 a month plan that I have is not, I’m not super-happy with that, but the deal with that is, I know that there are a lot of really early-stage companies and I know that if do my job correctly and build the right product. Those people will eventually upgrade because based on their customer account, like they will instead of having 250 customers, which is the limit for the low-paying plan, they could have, they’ll keep growing pass it out, and then end up needing to upgrade.
So that’s the thinking behind that, and 29 is like most people don’t want to think about that even on the early stages of their company. So establishing the price Baremetrics was just me picking a couple of numbers, so that I, I knew there are some price points that ultimately wanted. I want to build a business around like 50 to $100 a month, average revenue per customer. So that’s kind of where the pricing went from. And I wanted to say a little bit on the premium side of things, because I want people who are serious about the business that they are in. So that’s that pricing question.
The next question here is, how do you validate an idea? So validating an idea here, that’s convoluted one. Like validation is weird thing, like people talk, they talk a lot about how to validate an idea, and a lot of it revolves around trying for you to do the least amount of work as possible, which seems like such a cop-out when you’re trying to build hundreds of thousands or millions of dollars in business on this idea. So why would you just want to like throw it into the wind and see what happens here? That’s crazy. So validating an idea, ultimately I think comes down, so I’ve talked about this before.
But to me the only type of validation that’s exists when you are trying to build a sustainable business, we are not talking about debenture funded people, who just need a bunch of growth so they can sell the company off later. We are talking like building a sustainable business that will pay for itself, that will pay for your salary, that will pay for potential employee salaries, all that kind of stuff. How do you evaluate that idea? And the only type of validation that there really is in that regard is money. So if you are getting money from people then theoretically you really has got the start of a good idea.
If you can’t get anybody to give you money, you are up a creek, so that might tell you you shouldn’t be worrying with that idea, or you need to change what it is that you are focusing on. Collecting email addresses in a launch page is bogus, that doesn’t mean anything. A thousand people, 10,000 people on your prelaunch mailing list does not validate your idea at all. It doesn’t mean anything. If anything, it’s pretty misleading because it makes you think that people want that idea, but all they wanted to do was put their email address in a form field. That is they didn’t want to pay you to make your business succeed. So email address collection isn’t validation in itself. It can be a good way to stay in touch with, to let them know about you launching a product, but using that as your validation is a slippery slope. So that’s what I have to say about validating an idea.
So next question here is, how do you decide what features to include in a minimum viable product? I just realized that misspelled when I say ‘in lieud,’ that’s a typo on my part, ‘in lieud’ is not a word. So how do you decide what features to include on a minimum viable product, on MVP? The features ultimately comes down to, so my stance there is you need especially early on. You need the features that will ultimately make you money.
That sounds a little sleazy used-car salesman, but you need if that feature is not going to have a direct impact on your ability to stay in business, it’s not, it doesn’t make it into the MVP. It’s got to be, you’ve got to launch stuff that has an effect on the bottom line, otherwise you are throwing stuff out there that people probably don’t even want or they are not willing to pay for, which is a problem when you need them to pay for. So that’s how I decide that.
So next question here and this is kind of similar is, how you decide what to prioritize when you are solo or on a small team? So how do you decide what to prioritize, especially when you are a small team and you are not, have some team of 20 people or 30 people or 100 people working on some product? So Baremetrics has been from the start just me, so I’ve been handling design, development, any kind of marketing, whatever it is. So I’ve been handling that, so I’m technically solo, or until a few days ago I got a Ruby dev who is starting to help me tackle some stuff.
How do I prioritize stuff? This goes back to that MVP question. So deciding … by prioritizing is stuff that again helps me stay in business. So for instance there is like a notifications feature that I launched a few months back with Baremetrics, so that is an upgrade feature. And that’s what a lot of people want, so they want to be notified of, if they had failed charges or they want to receive a weekly summary of their metrics. That was a priority for me because I knew that people would pay for that. So that’s how I prioritize that stuff. It’s about what again affects the bottom line. This is early on stuff here. We are not talking about making a product that makes people feel happy or whatever. It is a stuff that you need to do this, so you can stay in business.
Next question here, to what do you attribute the success of Baremetrics compared to your less successful products? Here is that question. So that’s a good question here, and I don’t, I still wouldn’t say Baremetrics is quote unquote successful. It’s doing well, like growth is really great, but we have so much further to go. So the question here is, is referencing a couple of other products I have, PopSurvey and Temper. Both of those, PopSurvey I’ve had since for the past, I don’t know, I think I launched in 2011 and then Temper launched a little over a year ago.
And why did those not really work out? And it goes back to what I was saying a couple of questions back about, is about the solving a pain. So needing to make sure that the thing that you are building is actually something that people want. So like right now Temper, which is a customer satisfaction tool, measuring customer satisfaction tool. For most people that is a solution, that’s looking for a problem. So there are people who use it and love it and it works, it’s exactly what they needed, they had a problem, Temper fixed it. But for most people they arrive at the site and it’s like, I don’t even know what problem you are trying to solve.
And I don’t think it’s a marketing thing. It’s not like I need to reposition, it’s the tool itself is not solving a large enough problem. So that’s what I think Baremetrics is solving a big problem in a, that has a direct correlation to the money that people are making. So they know, okay, if I can figure, if I … someone can tell me what churn is, if somebody can tell me what lifetime value is, that has direct effect on how I run my business, and the money that it makes or does it make. So Baremetrics is an easy sell, so easy. So that’s why I think it’s done as well as it has.
Next question, would you build a product first and then try to market it or start building up a mailing list first? We’ll talk about this, here is that question. So building a product first and then marketing it, which is, it’s kind of what I did with Baremetrics, so Baremetrics was built in a month, really over eight days spread out across a month. And I had built that first before trying to market it, before trying to see if anybody was interested in it, because I needed it for PopSurvey and Temper which I just mentioned. So I built the product first, but I spent, I literally spent about eight days of my time. That’s not a ton of time. And that was like nights and weekends kind of thing.
And I was juggling other client work at the time, I’ve got these other two SaaS products that are flailing. So it may have made sense to me to try to find a market for, but as fast as I turned that around, like there wasn’t really a lot of time to, quote unquote “prove the market.” So I saved myself this huge like months and months of trying to figure out if there is market for it or not by just building the thing and then saying, hey, here is the problem I think you have, here is the solution to that problem. So it’s a super-easy sell, and I didn’t have to because I have a product to show them instead of just asking them a bunch of questions.
So that’s, to me that’s ideal, to start a mailing list first, I don’t, I’m not a huge fan of that, I’ve got plenty of friends who are big fans of the mailing list thing first, like get a bunch of emails and then launch to that mailing list. I don’t think there is something inherently wrong with that approach, it’s too slow for me. I got to go move fast.
Next question here, let’s see, hold on. What is something someone can do today …? This is from Felix in the chat room. What something someone can do today to find a potential pain or problem that needs a solution? So that’s a hard one, I think when it is like looking to the ether and thinking, “Hmm, where is the problem, where is the pain? I need to solve that, and I’m happy to solve that.” So, yeah, that’s what somebody just commented, solve your own problem. That’s always been my trajectory there as, here is a problem that I’ve noticing for me. The benefit of the [inaudible 00:20:41] approach is that a lot of times, a lot of times there is, you are not the only person with that problem.
So it may be specific to your industry, it may be like a larger business problem that a lot of different businesses who need a solution for, but doing that at least gives you somewhere a path to start down. That product, that thing that you’ve built may not pan out, but the thing is is when the more you build stuff, the more that you ship stuff, the more that all the stuff that you learn from that goes onto the next one. So like Baremetrics would not have existed had I not built PopSurvey and temper. Literally the idea would not have been in my head at all.
But, so I needed to have built PopSurvey and Temper for Baremetrics to exist. So there is this whole timeline of the past decade of me building products, and all those lead into the next, into the next, and that being the stepping stone for the next. So that’s, I think it’s important to just keep shipping stuff as fast as you can, and knowing when to call I quit. Call I quit. So like if you’re not able to be honest with yourself about when this thing in working out, then that can be kind of a risky thing, but as long as you’re being honest with, hey, nobody wants this, I can’t get anybody pay for it then you … you should, if you are good at that, if you are good at being honest with yourself, then I think that’s a good way to go down.
Let’s do a couple of more questions from the chat room here. So Parker asks you mentioned client work, do you freelance? If so, how do you attract new clients and work? No, I do not do freelancing anymore. Actually, so Baremetrics, I’ve been freelancing with building products for the past few years, and I’m actually, I’m wrapping up with the last client that I have hopefully forever. They have been a great client but I’m out of the client world. So I’ve been balancing that for awhile, and now I’m getting out of that, I’m completely out of client stuff now.
So let’s see, there is a couple more chat room questions here. Alex asks, are you worried that Baremetrics is only first Stripe? I’ve heard that creating an app on platform is dangerous. So am I worried? No. I think Stripe is, we are like the birthing place of Stripe’s ecosystem. And right now, it’s a really nice place to be, and also I’m focused, I’m focused on SaaS Stripe users. The market Stripe’s user base, the SaaS part of that is actually really small. So the next step is open up to non-SaaS Stripe users. So that would be like e-commerce sites for instance. So that’s like, that’s the next step, that triples, potentially quadruples the market size of where I’m at right now.
And then from there if I still need more expansion and I want to get to a different type of market, then that’s where I can open up to other platforms whether that’s Braintree or heaven forbid PayPal, I don’t think … I feel comfortable saying I’ll never do anything with PayPal.
Let’s see another chat room question. Adam asks, do you plan on making Baremetrics your primary business going forward? And is there a milestone for Baremetrics that would cause you to sell or shutdown your other sites and only focus on Baremetrics? I am primarily focused on Baremetrics 100% now as is. And there is a personal income milestone that will eventually mean that I don’t need the income from those other ones. So yes.
Anymore chat room question first before I jump to these others. Let’s go back to some other questions here. So what metrics should you pay attention to and why? So few people actually asked this question too, like what metrics should I be paying attention to here? That depends, and I think it depends on, A, the industry that you are in; and I also think, B, that it depends on what stage you are in your business. So for instance, in certain industries the churn could be extremely high for what you’re doing, so that maybe normal. So if you’ve got some like 15, 20, 30% churn, like that’s painful, but at the same time expecting to get that down to 2% is probably not realistic. So focusing on trying to get churn down to 2% will be a waste of your time.
Then think about the stage of your business, for instance. Right now Baremetrics is still pretty early, six months in basically. So what metric do I care about? MRR, monthly recurring revenue, that’s really my only focus. My churn is higher, my user and revenue churn is higher than I really want to be, but at the same time I need more customers especially for the user churn metric to really make a lot of sense to say, let me try A and see if this happens. If the outcome of trying A actually makes the churn go down, like I don’t have enough customer, 160 or 70 customers isn’t really enough as far as I’m concerned about being able to measure effectively reducing churns. So right now I’m focusing on getting revenue up, and that’s it.
So that’s what, that’s the metric I’m personally focused on. It depends on, if you are further down the road, yeah, I like figuring out how to lower churn is a big deal because that establishes your ability to stay in business longer. And doing the things like getting the average revenue per customer up, average revenue per user, ARPU. Getting that up means that you can have fewer customers. So the ARPU for Baremetrics is like 60 to 70 bucks. We have customers whose ARPU is like 2 or $3. So they need a massive amount, 20 times as many customers to make the same amount of money, and that’s just too much work for me. I don’t want, I would much rather have a higher ARPU that means I can have fewer customers and serve them better than have some thousands and thousands of customers who are paying me very little.
And then regards to churn, somebody just asked, Josh, why do you think your churn is that high? So I think right now it’s a lot of, the people that are churning are, and my churn right now I think is about eight or 9%, which is still way higher than I want. And the reason I think its high is that people don’t understand what to do with the metrics. So the people that who cancel, I talk to most of him and say, hey, why did you cancel? A lot of them it’s like, we don’t know what to do with the metrics or we are focused on other things or they are early stage enough, where they know the only thing they need to worry about is getting that MRR up. So seeing all these other metrics can be a distraction for them. But I think a lot of it is an education thing or it doesn’t quite give them enough insight, or it’s that stuff that we are certainly working on.
Next question here, did you design the site while developing it [Inaudible 00:28:32] at first or contract it out? So here is that question. So I did sort of tandem design and develop it at the same time. I did a little bit of stuff in Photoshop but mainly I just got it into the CSS stuff as fast as I could. Yes, I did them both at the same time. I didn’t contract anything out, I just did everything by myself. So I think that answers that question, sorry, if I didn’t.
Next question here is, what methods do you or will you employ to win customers back who have canceled their account? So interesting question here, how am I trying to get customers back who have left? To some extent I am not, but there is more to that. So interestingly we have quite a few people who come back after they’ve canceled a couple of months later and said, I thought I could live without the metrics. It turns out I actually do want to see them I’m back, I’ll start paying again. So lot of just me being patient, that’s one way to get customers back because they realize I did want that.
And then another is its expanding the product, so making it more valuable. So I think, that’s the main thing is like, there is some huge stuff that we’ve got in the works that I think will certainly bring back customers that otherwise have left because they felt like it didn’t do enough.
Let’s answer a couple of chat room questions. Pedro asks, you have been very open about your revenue on Baremetrics, which is the most successful product that you’ve built so far, and can we get insight about what numbers you were getting with your other products? So Baremetrics is the most successful from a growth standpoint, monthly recurring revenue, all that stuff. I haven’t decided if I’m ready to open up the numbers of the other products, mainly because if we are not try to sell them. I don’t want to like the new owner to inherit this openness that I forced on to them. So I’m keeping those low-key for now.
Someone asks, given a SaaS product with $5 a month plan and practically zero churn, do you think the price should be raised? If so, to what price? I don’t know anything about the business there, like what you are building there or anything, so it’s hard to say. I think $5 a month I would, I personally would never build anything that I was only charging $5 a month for. It’s just not a business that I want to be in.
Alright, let’s move on to another question submitted. Here we go. Alright, what has been the biggest growth channel and what have you done to capitalize on that? So again, what has been the biggest growth channel and what I’ve done to make the best of that to make it, help with growth even more? So biggest growth has been two things: One, content marketing, but not sleazy like posting generic content that nobody actually wants to read, content marketing, but like posting, my favorite type of stuff to write and it seems most people’s favorite type of thing to read is the, like here is the insight into my business.
So it’s getting other entrepreneurs giving them insight into how I’m running my business, because like in all honesty nobody really knows what they’re doing. People act like they know what they’re doing and some of them have more experience to back up what they are doing, but at the end of the day everybody is winging that. So giving people insight into the stuff that I’m trying, what is working, what isn’t working, that kind of stuff gets other entrepreneurs into the Baremetrics funnel per se and droves.
And that’s just being honest with the stuff that I’m writing, and it’s easy for me to write because it’s just been my experience, but at the same time I think just writing, writing in and of itself isn’t necessarily, although helpful. It’s writing stuff that’s legitimately useful to your market. So there is that. And then the other side of that has been Twitter, which is, I found so nasty, but it’s Twitter and people share, like the word-of-mouth that that gets, that people use Twitter as the vehicle for word-of-mouth marketing per se. They are able, they share Baremetrics a lot through Twitter. That’s just a really easy way for them to share. And a lot of my customers, so they are Stripe users, they are also, which tend to be early adopter types, through also [victories 00:34:16] or so.
That’s been a pretty good place for me to get new customers. And capitalizing on that has been just a matter like posting a lot of stuff, again like being honest, posting smaller snippets of things. I have actually tried this thing where I put an article, so this is kind of tying in Twitter with the content marketing stuff, but providing like an image that’s super easy to share on Twitter. So like with a quote, for instance, like a pull quote from the article and a nice graphic and with a button that says tweet this. So, yes.
So somebody asked have you tried Twitter ads? Yes, and I still use it. The conversion is not great on it, it’s more to get people, Stripe specific people to the site so that I can then retarget them with advertising, which I’ll talk about in a minute.
Alright, so let’s go to another question here. Next is what platform do you use for your blog? Rails, that’s the platform. It’s custom-built, simple little backend content management, like talking basic. It’s just part of the full Baremetrics app, Rails app. So it’s just simple entries in a database, nothing special.
Next question here, what kind of things do you do to get people to upgrade to higher plans? So what things do you do to get people to upgrade to higher plans? A few things here, so some of that’s feature limitations, so I mentioned notifications earlier. You have this notifications feature where people can get notified of certain events in Stripe or people cancel and they get summary emails and stuff. So it’s a big thing for a lot of people because they don’t necessarily want to have to visit the Baremetrics, their Baremetrics page every day or throughout the day. They just want to get a notification when certain major things happen.
For instance, you have to be on the $79 a month plan to get that, and that makes quite a few people upgrade from the $29 a month plan, even though if they are not technically there from a customer standpoint. They want the feature, so they are happy to pay for it. And then after that, it’s the limitation on customers is a pretty big one where they, at some point they either have to upgrade or they just have to stop using the service because there is that limit on the customer account.
There are some other things to let the people know that they should upgrade, so they might not know about that Baremetrics can send out a weekly summary email. So what I’ll do is after they’ve been around for a week or so, I will send them one week for free, so they’ll get on a Monday when those weekly emails go out, they’ll get one that has a little note at the top that says, hey, you like this, upgrade to the next plan if you want to keep getting this and some other features. So that is a way I give them a taste of this cool thing that they might want and then tell them how they can keep getting that.
Let’s see. So in that same vein, what do you think about lifecycle emails to activate users should not … should the user automatically activate if the product is good enough? For me as far as what’s, what, how, when a user becomes active is if they connect their Stripe account. So because that means that they, all of a sudden got a ton of value out of it. If they don’t connect their Stripe account then they are literally paying for nothing. So that’s when they become active or activated as far as Baremetrics is concerned.
Next question here, so few people have asked this in the chat room already. What’s the most effective marketing tactic for getting the first 10 customers? So most effective marketing tactic for getting the first 10 customers. This would vary dramatically I think across any business because your customers are in different places. For me, and I think that your, maybe like you are barking up the wrong tree, like looking for a simple, like do this thing, here are five steps to get your first 10 customers. I don’t think it’s that easy. I think there is a core fundamental shift in the way that you are building your business that get you the first 10 customers.
So for me it means solving, again, going back to that pain point thing, like solving the pain for people. When the first 10 customers were probably, like me reaching out to some people, but that might have just been posting a tweet, saying, hey, I’ve got this SaaS analytics for Stripe thing, anybody interested? And that gets re-tweeted, like that sounds so like that’s an easy thing to do, but I don’t think, that’s not something you can do and it just worked. It comes down to the type of product that you have and the type of, the solution that you’re offering to the, hopefully big pain point.
So that might be a tweet, that might not be anything at all. That might not be any social media thing. That might mean you’ve got to make 100 phone calls or send a bunch of cold emails. But you have to do something to get in front of those people, and there is no like secret sauce there, I think except other than offering a huge solution to a major pain. So some of those off, I think kind of playing off that.
What was the moment … this is from the chat room. What was the moment Baremetrics really took off and how did it happen? It’s been like a gradual thing, the past two months have been big from a growth standpoint, like last month almost doubled customers and recurring revenue. So a lot of that happened because I started pushing the content stuff again, like launched the blog and started posting legitimate content and not just junkie stuff. And then deal with Buffer that we made last week. So that, they are making their metrics, their Baremetrics account public really through Baremetrics into the spotlight as it were. So that worked out really well.
Did you do an early access beta program to get early feedback and work out bugs? No. Again, I built the thing in eight days, so there is not enough time to create a beta program or anything like that. I got a couple of, I think I might have gotten three buddies of mine just to log-in and connect their Stripe account, to make sure everything didn’t hit the fan. But other than that, so they obviously gave me some feedback, but all those people are paying customers now, like they started paying. So that’s, I didn’t do, it’s the early, I don’t have a problem with bugs in the sense that like if I get a, if there is a server error or something like that, like fine, I’ll get an email about it and I’ll fix it, like spending months and months and months trying to have 100% bug free software is impossible, one. And two, the payoff is not there for the time that you have to put in.
Another question here, this is, I mentioned this earlier, but other than … we’ll talk about two things here. Here is the question. Other than retargeting what paid advertising have you done? So there is actually two things I want to hit on here. I’ll answer the main question, which is what paid advertising have you done. Twitter ads and Facebook ads separate from retargeting I have tried both of those. And that early on, like we are talking the first couple of weeks, I did Google, I did AdWords, but that was mainly trying to catch things like Stripe term … search, term searches like Stripe metrics, Stripe analytics, that kind of stuff. Within a couple of weeks of launching, I ranked first for that. So I stopped paying for it. It wasn’t worth it, it was expensive, I think it was costing 10 bucks a click, which was stupid, and I ranked number one. So who cares?
The Twitter ad stuff, it’s hit or miss, again that’s to get more people funneled into the retargeting, which I want to talk about. So I use perfectaudience.com for retargeting, so that’s … If you are not familiar with what retargeting is, that’s a way that if someone, say someone comes and visits the Baremetrics site, they get tagged with a cookie that says, hey, he has been to the Baremetrics site. So then other sites you’ll start seeing Baremetrics ads, the most effective type of retargeting or channel for retargeting is Facebook, so showing just a little sidebar ad.
And the reason that works really well is that they are familiar with, they’ve seen Baremetrics already. So it’s not like some random thing they haven’t heard about it before and they just saw a banner ad for [inaudible 00:44:03] and think I’ll get some money from them. That’s not how that works, that’s not the reason that retargeting works. Retargeting works because you are triggering in their head again, oh yeah, I saw that earlier. Oh that was that thing that does the thing for the thing.
So that’s what happens with the retargeting stuff on Facebook they see like, the little ad that have a stripe logo on it or they’ll have the Baremetrics logo or they are going to have headline about SaaS analytics for Stripe. So it reminds them of, gets them back to the site and they ultimately convert. So that’s why that works pretty well, and I wrote about that on the blog, the how we get a 600, we get $650 worth of customer from $6 acquisition, so you can read about that on the blog.
Let’s see. It’s a good question. This is in the chat room. What if in the future Stripe, basically Stripe creates metrics and analytics and puts within their system. So that’s a [valid 00:45:00], that was actually a major concern of mine from the start like, I almost didn’t even launch Baremetrics because it was like, I need this now but I don’t, I mean Stripe is going to build it in a year and who cares. I just do it myself and keep it internal. But conversations with guys at Stripe, understanding where they are headed in their long-term goals, I’m not terribly concerned about it.
Again, I’m SaaS focused right now and Stripe is so much bigger than SaaS products. SaaS is not even the majority of their user base. So there is just, that’s a huge market, and it’s not something I’m all that concerned about anymore, and there is the whole possibility of me expanding to other platforms like Braintree or whatever. So I’m not too worried about it.
Next question. I believe I read that Hiten Shah had a helping hand in the Buffer deal, correct? Do you find it hard to network with people in the tech scene while living in the south, which is outside of the tech hub? So, yeah, we are very much out of the tech hug, I’m in Birmingham, Alabama, which there is not anything here from a tech standpoint. Do I find it hard to network? Yes and no. I don’t know, I go and … I work from home, this is my home office. And once a week I go, work at a coffee shop or at a buddy’s studios or something like that. So I get interaction with other people, which to me ends up being, I don’t know. From a just networking with other businesses standpoint, I’d always find a ton of value.
I think it’s more like just hanging out with other business owners, tech or not, to me is really interesting. But I also go to conferences, be at conferences, all that stuff, which if I do that every few months, it fills the tank for me, and I’m in like a couple of different chat rooms with people that I literally talk to every single day about business. And a lot of them are much more successful than I am, so it’s like, I get some of their, the tips and tricks and their business acumen rubs off.
Next question, what’s your development process like that allows you to ship often? A big thing that I talk about a lot is shipping fast and frequently. So that means I’ll have an idea for some new feature and I’ll 24 hours later will ship it. So that was the case with like Baremetrics has a live stream thing and a notifications thing, like both of those are ultimately built-in about 48 hours or less.
So it’s just, how do I ship stuff that quickly? The big thing is focusing on not trying to build this gargantuan feature. I want to ship a really basic version of a feature, and then see how people actually use it. So when you talk to people via email or even on the phone and talk to them about features that they want or whatever, they’ll make a feature suggestion. A lot of times that’s not the think they are really wanting, there is some other deeper problem that they are trying to solve.
So by launching a really basic version you can figure out if anybody actually wants it, and if they do how are they actually using it. So you don’t end up building these features with lots of extra craft on them. So it’s just a matter of building really basic things and shipping it as quickly as humanly possible. That’s a big thing for me.
So that’s all the pre-submitted questions I have. So if you’ve got other questions, go ahead and post them in the chat room and we’ll tackle that stuff there. Alright, let’s get back to some questions in Stripe. Pedro asks you have pricing plans from the higher pricing on the left to the lower pricing on the right, and was that on purpose? Yes, that was the purpose. So it’s a price anchoring strategy there. So people start off, they read from left to right, so they see on the left the $250 a month question, $250 a month plan and they are like, “Good glory, this is expensive.” And they keep reading and they see, “Oh, okay, this is like the top-level plan.” And it makes the other plans not hurt so much. At least that makes for them, it doesn’t feel as like a big of a cost because they started off seeing the big one.
What if anything have you decided … Mike asks, what if anything have you decided to outsource or contract out? So right now I’ve got a Ruby dev that I’m contracting out some stuff for. And he is tackling a lot of the big data problems, so managing millions and millions of rows in a database, gigabytes of data, and having to process all that stuff to calculate all the metrics. It can be really slow and it’s expensive. So he is right now focused on reducing some costs there because my [Heroku 00:50:40] bill is nasty. So he is helping with that right now, but eventually I’d like to get another designer in or frontend of whatever, couple of backend people. There is lots of work that I would like to do so.
How long have you been … Jordan asks, how long have you been a bootstrapper for and have you had to go back to freelancing or a job during that timeframe? So I’ve been self-employed for a decade, doing my own thing. I’ve never taken funding for anything, any project that I’ve worked on. Back in 2007 I think I had a site called TheAppleBlog that got acquired by a company called GigaOM in San Francisco. So I stayed on board with them for awhile, running that and growing that while also building my own stuff. So that was a weird hybrid period.
I freelanced, I was actively taking on new clients up until six months ago maybe, and then Baremetrics has taken off to enough to where I haven’t, I had do that. And I hadn’t had a job per se, like going to the office, work for the man, kind of thing, and yeah, almost a decade.
What dev tools … Adam asks, what dev tools do you use or love the most? It’s pretty simple, so I use Sublime Text and, as far as the actual tools go, that and OS X Terminal, that’s been a good junk of my day in there from as far as dev stuff goes.
Let’s see if there is any other questions. Post more questions if you want to keep yapping. I can chat all day, so definitely post them. Oh somebody mentioned this earlier. So posting on medium is becoming a very good way to get growth in traffic as long as the content is good. So I’m kind of anti-medium, only because you have no control over capturing that reader. They have no reason to … sure, you can include links to things but you can’t really get their email address to get them within any kind of like sales funnel or anything like that. Like you are one of thousands of other pieces of content there that anybody else who get easily distracted by an, ooh, I see that headline done here, let me stop reading your article and then do the other thing. Like it’s, I don’t think that there is enough of real distribution.
And as far as getting growth in traffic, traffic itself doesn’t really mean anything. So you need to get growth in customers, so people who are willing to give you money, and I would say that that’s … you might get some traffic but it’s all like Hacker News, like I get a ton of traffic from Hacker News but rarely does it actually end up in new customers.
So let’s see, some copywriting tips. I’m not sure what you are talking about, like talking about writing headlines and things or actual like writing articles, I’m not sure. I don’t know that I have any tips other than write about things that or be clear when you are like in a headline for instance. Be clear, like don’t try to be clever, taglines are usually a really bad idea because there are kind of ominous and people have to chew on it, and think what does that even mean. So we go to the Baremetrics site, it’s SaaS analytics for Stripe, that’s the big headline, and that’s clear, it’s about as clear as it can be. Though not clear enough, people still sign-up that aren’t SaaS companies and they don’t even use Stripe [try to sign-out 00:54:27], which is crazy.
Jordan asks, how do your friends and family think about what you do? Do they consider you a real entrepreneur or think you should get a real job? Friends and family are great, most don’t get it. Like, I don’t know what do you do, like Josh does the thing with the computers. My parents are pretty good, again, I’ve been doing this for a decade, even in college I was always building stuff. I have been building web stuff for the better part of, since ’99 or something like that.
So it’s not like this is out of nowhere, I’ve had small business stuff for a decade. So I would say family and friends, they are used to it. Sometimes they’ll ask questions but for the most past I don’t even necessarily like talking about it a lot. Not that I’m afraid to talk about it with friends, it’s just sort of there is lot more to life than being an entrepreneur. Like there is the garden that I spend a lot of time in, there is hanging out with my kids or hanging out with friends and all that stuff, doing other stuff completely unrelated to the Internet.
Jarrett asks, how do you tackle something way more complex? So he is talking about shipping things quickly if something is way more complex, what if there is no basic version? I would say that there is a basic version, so that may not be, I think you have to break down to smaller pieces that maybe, that it may not be the thing, the ultimate thing that you are wanting to build, and it may not do the thing that you are wanting it to do, but at the same time I think, again, the same way that you needed to, you need to prove that your business is viable by charging for it as early as possible and getting people to give you money. You need to prove that if anybody wants the feature as quickly as possible, so that means doing whatever you can with as little work as possible to prove that that feature is worth your time.
Mikey asks, as Baremetrics has grown, have you sort of feel any particular pull to move to a more traditional tech city like San Francisco or New York? I was talking to my wife the other day about this, mainly because a few weeks ago I was at MicroConf, and that was a few days of basically a bunch of self-funded people hanging out and just talk and shop and stuff, so that’s fun, tons of fun. And I love going to conferences in that regard because it’s this like really concentrated group of people who all are just interested in the same thing. So it’s like being able to be around that a lot I think would be beneficial.
The problem is San Francisco and New York as far, like the tech cities are not, they are not building the businesses that I have any interest in building. I have no interest in getting like funding or anything like that. And I think a lot of those, those are quote unquote “bubbles” in many regards. So the surrounding yourself with people who are building things that, I don’t care about that, a lot of their customers don’t care about their build, they are not solving actual problems in many cases. And that’s just not necessarily something that I’m attractive to be around. So I’m not, no, I’m not, I don’t feel a real strong pull to those like major tech cities. I wouldn’t mind being in a bigger city; Birmingham, Alabama, is not huge by any regard. I lived in Denver for five years, and that’s a great city and a good size and doesn’t have that like just gross weird startup like tech scene that San Francisco and New York have so.
Do you still work in your other projects, Temper and PopSurvey, did you put them on autopilot? They are largely on autopilot, I answer support requests, but that’s pretty much it.
What aspect of entrepreneur … that’s the hardest word on the planet to say. What aspect of entrepreneurship do you think is most challenging: Time management, prioritization, quantity of work or something else? Prioritization is a big one, like there are so many things I could be working on, but what makes the most sense. And for me like what moves the needle as far as revenue goes. And that’s the most challenging.
And then also like still, there is so much that I want to do, but since I’m growing my business only on the revenue that I’m making and not taking outside funding or anything, means that I’m not getting to do the stuff as fast as I would want. Like if I had somebody give me $1 million, I could hire people and move faster, but at the same time there is a major drawback to that, because I have, then I don’t have to like actual, I don’t have to solve problems as efficiently or, and I’m less inclined to work on stuff that actually helps from a business perspective.
So right now my main focus, again, is getting the MRR up because that means the sooner I get the more money I’m making, the more I can hire or expand and add more stuff, that kind of thing. So that’s the prioritization part, like not knowing what to prioritize because not knowing what the outcome would be, that is probably the hardest part.
Alright, let’s do a couple more questions and then we’ll cut it off around one, so we can all get back to doing work. Let’s see here. Carson, how to pronounce entrepreneurship? There is a funny YouTube video but I think you … yeah, no links because you are a guest. Again, we will take like maybe two more questions if those exist and then we’ll call, we’ll put this one on the books and call it a day.
This is good one, Taylor. Have you thought about starting an affiliate program? Yes, and then I quickly decided no. So the reason I’d say affiliate programs don’t work for B2B, because for instance, like why would I post a bunch of affiliate links for this business product, like instead I don’t care about saving 10 bucks a month or whatever. I just want to pay the money and move on and focus on my business. So like, affiliate programs typically are attached to trying to save money on something, so like I would want the [drawl 01:01:15] to doing affiliate program is that, or for me like signing up for someone else’s affiliate program is like to save money on my bill or something like that. But in reality those never … you are never ever saving a lot of money.
And so as a business there are much more effective things for me to do, ways to spend my time. So it makes a lot more sense for me to spend the time that I have, instead of doing affiliate links and posting those around and stuff to try to save a few bucks, I’d just grow my business and make a hundred extra bucks that month, that recurs instead of trying to save a few bucks once. So I have no real plans of doing an affiliate program, because I don’t think it makes sense for B2B.
And this might be a good one to end on. So Mikey asks do you drink coffee? When I started bootstrapping from home, I felt I had to start. Yes, I do drink coffee. And I drink a few cups a day, but I’ve been doing for awhile, so for years. Something that I didn’t, business didn’t make me inherently drink coffee, I just like coffee.
Let’s call I quit on this one for this week. Whatever I think, actually I’m going to hit stop record now, and then we can just yap a little bit. So what did everybody think? Let me know in the comments what you think. Did you like doing this, was the format nice? Anything you, that wasn’t a lot of fun. What was, something, moving drag on, audio quality good, video quality decent, that kind of stuff. I’d like to hear what you think. So you can either post them in the comments, I’ll hang out here in the chat room for a little while or shoot me an email at firstname.lastname@example.org, and we can chat more there or hitting up on Twitter at Shpigford is my Twitter handle. There we go. So hit me up wherever, I’m happy to talk about this stuff all day. Thanks folks.