Hello! Who are you and what business did you start?
Howdy! I’m Baird. 👋🤠 I’m a sales guy that loves all things tech but can’t code (I tried. Not for me). I am also a marketer, but I’m not sure exactly how that came to be. I’m a husband and a dad. I love building companies that let me be those things more and provide value to others.
Most of my day job is running Wavve alongside Nick Fogle & Rob Moore. Wavve is a SaaS product that helps podcasters, musicians, and other audio creators to promote their content on social media. We do that through two products:
Wavve Video makes audio content pop on social. It allows any audio creator to clip a piece of their audio content and turn it into a custom-designed social video pre-fit for Instagram, Facebook, IGTV, Twitter, and more. Wavve comes with a drag-and-drop editor that makes it easy to create designs that include images, animations, subtitles/captions, and more. Here is an example of what a Wavve video looks like:
We recently launched a second product, Wavve Link which turns podcasters RSS feed into a website. It’s the easiest way to get a landing page up and running for your podcast. A lot of podcasters use it as a one-link tool to share their podcast Link page on Instagram. That way, any listener can get to their favorite podcast player and start listening in seconds.
We have over 70,000 audio creators that have signed up for Wavve. Some of our more noteworthy customers include:
- ESPN Radio
- Dave Ramsey
- iHeart Media
Over the past 3 years, we have bootstrapped the business to $75k in monthly recurring revenue. However, Wavve was born out of a failed startup that we tried to start before it.
What's your backstory and how did you come up with the idea?
Everything technically started with my co-founder and I’s wives. At the time, I was an early employee at a Startup and had been a sales engineer there for about 4 years. Nick had passed the bar (he is a lawyer) and decided for a change of pace to work at a tech company as a software engineer. We were both getting the entrepreneurial itch. Our wives got tired of hearing all about our ideas and forced us to go get coffee and talk to each other about them.
We started in 2015 with an attempt to build a new kind of social network. One where you followed radio shows, podcasts, topics, and other subjects and verbally talked with other fans about them instead of typing. Think Reddit crossed with audio & Twitter.
You need to judge your progress by years because that is how long it takes to accomplish anything of importance.
Greatest idea ever, I know.
The idea originally came from my time doing sales at a startup where I was in the car quite a bit. I listened to a lot of sports radio and hated that I couldn’t “chime in” virtually with my voice on whatever pointless debate was occurring at the time. The idea expanded from there to sports teams, politics, video games, and more.
We gave it a good run. It was called the uTalk. We spent two years total on it and I lost my savings account. We launched on iOS & Android, acquired thousands of active users, partnered with ESPN radio shows, secured partnerships with FOX & iHeart Radio Shows, and demonstrated various potential revenue streams.
☝️ Everything in the previous paragraph is true yet covered in lies. ☝️
Even though we had great PR headlines, we never found a way to turn it into a business. And this is why we decided we never want to start companies that require Ventures Capital again. It’s a different type of game that we aren’t interested in playing. Anyway… I digress.
Towards the end, we decided to try a marketing experiment. We figured that if we could take all of this amazing audio content our users were uploading and get it on social media, other people would hear what they are missing out on and download the app.
We found a problem. You can’t share audio on social media. So over a weekend, my partner coded up a quick tool that converted audio into mp4 video files which actually can be shared on social media. Here is what our first videos looked like:
We started using it internally and a funny thing happened. Podcasters started emailing us and asking us how we created these “audio-video posts”.
The lightbulb went off. We were working on the wrong thing. This is where I learned my biggest lesson in entrepreneurship: Focus on solving problems, not ideas. Two months later we had a beta version of Wavve out and an official release in January of 2017. We were able to sell the previous business and recoup a little bit of our lost investment. We were both out of money at the time so we had to start freelancing to pay the bills.
Take us through the process of designing, prototyping, and manufacturing your first product.
LOL. That’s funny.
There wasn’t any design or prototyping. I guess there had to be a little manufacturing.
We were just building a tool for ourselves to use as fast as possible. Once we realized that people would pay for it, we were trying to figure out how to hack our way to paying customers.
Our first paying customer paid us through a Wordpress Stripe Plugin and then accessed the app through a private IP Address with no authentication built-in. Customers would click a drop-down and find the design we made for them along with a list of other random designs (other customers). Gross, I know. Here is a screenshot of the original UI:
Once we realized podcasters and other audio creators would pay for this, we started acting a bit more professionally. However, design, UX, and prototyping was always an afterthought. Our sole focus was:
What are customers willing to pay for? What is preventing them from signing up? And what causes them to churn?
We focused on those three things obsessively (well, when we weren’t freelancing to pay the bills). After 6 months of manually creating designs for customers after they signed up, we built a drag/drop design interface that continues to be our biggest value driver today. Here is an early look at that first version:
I don’t advise this but we actually found that bad UX was a good litmus test for how bad a custom needed the solution. If they are willing to work through a tough interface to solve their problem, there is a good chance you are on the right path.
Describe the process of launching the business.
Once we realized that we found some product-market fit, it was time to get serious and try to build a good business. There was never really a “launch” of any kind. We just pushed the web app live, worked to improve it, and slowly started driving attention to it.
At the time, podcasting was definitely a thing but wasn’t booming like it was today. Podcasters hung out in fragmented communities (Reddit, FB groups, etc.) and there weren’t many daily tech headlines talking about it. Facebook was still dominating but Instagram was growing like crazy and looked like it could take over the #1 social app spot.
Nick (my co-founder) and I both had $1,000 that we could use to start the business. We started a new LLC for the business and funded it with the $2,000. My primary job was to bring more users to the app and Nick would focus on engineering.
Our assumption was that most podcasters wouldn’t pay much more than $10/month for this type of tool. We created some rough financial models of what we think we could make over the next 12-36 months. At the worst, we thought this would be a great side-gig that could make a few thousand dollars per month. We agreed it was worth a year’s worth of work to see where it would go.
Even the most generous financial models we made didn’t look like business VC’s would invest in (there weren’t any indy investors like there are now). We knew we had to bootstrap it so we started the business focusing on three customer acquisition channels we could fund with our time:
- Direct outreach
- Content marketing
- Social media
Direct outreach was really the only way we had to generate customers on-demand. I spent the first half of 2017 mostly just emailing podcasters and hitting them up on social media. Here is a screenshot of one of my early sales email that someone (randomly) responded to two years later:
There were a lot of podcasters that were trying to figure out Instagram for promotion so I would send them DMs there and ask them to check out the product. They really appreciated someone reaching out and trying to help them grow their audience.
It was definitely a slow start:
The biggest lesson learned was how much patience is required to build this type of business. We had a functioning version 1.0 product, a well-defined target market (podcasters), and they were willing to spend (some) money. Even with these pieces figured out, we learned how long it takes to build an audience, brand, and inbound strategy from scratch.
Since launch, what has worked to attract and retain customers?
We have been lucky in that our product creates shareable social content. This naturally encourages word of mouth growth. Once we noticed this happening, we really doubled down on making sure our product made videos stand out on social media. The more we could get people asking “Wow. How did you make that video?”, the more referrals we would get.
We focused a lot on creating high-quality, custom audio animations. These animations are a staple of our product and while we had competitors, no one has animations quite like ours. Making sure these animations and other video elements stand out from the rest was key.
Another way we encourage word of mouth growth is by sharing customer examples on social media. We are firm believers in being the guide, not the hero when marketing. That means we try not to talk about how great we are but rather lift up our customer’s success stories from using our product. It’s a lot easier to talk about how great they are. A good example of this is our Instagram page where we share customer videos and show off their designs:
We also focused heavily on content marketing. The goal was to write one blog post a week. Of course, we didn’t hit that target often but it did result in a lot of blog content on our website. We primarily focused on writing “how-to” articles on podcasting. This strategy takes a lot of patience because it seems like 6 months is required to start getting any traction. We never tried to outthink Google when it comes to SEO. Rather, put ourselves in the shoes of our customers and ask “What kind of content are they searching for?”.
This screenshot from our last 6 months of traffic overviews it nicely. We are starting to experiment with paid social advertising using Facebook, Instagram, Twitter, & Adwords. We have always had Adword campaigns running ($1-2k per month) but we weren’t tracking conversions or experimenting. We feel this a good play for our next level of growth:
How are you doing today and what does the future look like?
We’re currently doing $75,000 MRR and enjoy gross margins of 80 - 90%. In 2019 we grew MRR by 141%. That’s two years in a row where we’ve posted 3-digit growth (+369% in 2018). It’s still early, but 2020 is already shaping up to be another year of strong revenue growth. We’ve already exceeded what we did in January 2019 and there are still ten days to go.
We have over 80,000 users and about 6,000 of those are paying customers. All Wavve customers sign up and subscribe through the website. We use Stripe to handle payments and have used Stripe’s API to automate our billing system.
We built Wavve to run as an extremely lean, passive business. While most of the business is automated, we do have some extra contract help on a part-time basis. This is mostly in the following areas: customer support, copywriting, and marketing.
We actually prefer hiring contractors over employees, because it’s less expensive and there’s the less administrative overhead required (and they love the freedom). While a 1099 contractor will be more expensive on an hourly basis, the fully-loaded cost of an employee could be 50% more after you consider taxes and benefits.
On the engineering side, we’ve automated a large number of tasks and have detailed monitoring in place to prevent downtime and speed up any bug fixes or maintenance. We’ve also been ruthless about optimizing our AWS infrastructure to keep costs as low as possible.
Our goal is to hit $1 Million in annual recurring revenue. We’ve dreamed of this goal for a long-time and now it’s within reach. We’re hoping to reach it this summer.
We are also working on some new product concepts under the brand Lofi Ventures. We are hoping to bring on a partner of some kind to help run Wavve day-to-day or take it over so we can focus on these.
Through starting the business, have you learned anything particularly helpful or advantageous?
This is a bit meta but the most important thing I have learned is how important decision making is when running a business. Decision making is the most valuable skill your founding team can have. We learned that you can make the right decision but still be a bad decision-maker. For example, if it took you two weeks to choose your next blog post title, you made the right decision in a poor fashion. You have to learn how to make good decisions fast and know when to reverse those decisions if you made the wrong call.
I recommend reading about mental models if you need help in this area.
We also learned that your customer is changing everything. Pricing, acquisition strategy, retention, etc., In our case, most of our customers are podcasters. The more we learned about them, the more we understood our business. For example, we found most Podcasters take breaks throughout the year (some of them release “seasons”) which meant a high churn rate. To counteract this, we launched an account pausing feature to help them keep their account open and available to turn back on after the pause.
What platform/tools do you use for your business?
Our tech is running on a modern JS stack with VueJS on the frontend and NodeJS on the backend. Our video rendering infrastructure is fully serverless which cuts our rendering time down to a fraction of our competitors.
On the customer side, Intercom is our go-to platform. We use their live chat to give our customers real-time support. Our responsive customer support is something that’s allowed us to separate ourselves from the competition. We also use the intercom platform for our help articles and outbound messaging campaigns.
For project management, we use a combination of Github for issue tracking and a simple Google Sheets spreadsheet for long term project planning. The marketing team uses Asana to keep track of the content calendar, ideas, and projects. Slack is the preferred internal communication tool.
What have been the most influential books, podcasts, or other resources?
Moneyball is hands down the most influential book for me. The way Billy Beane was able to step away from all the norms in baseball and think differently is really inspirational to me. We try to apply a “Moneyball” type strategy to everything we do when building a business. Even if you aren’t a baseball fan, you can learn a lot from how the Oakland A’s were able to beat better teams consistently by thinking differently.
After adopting the “Moneyball” attitude, we became pretty stingy when deciding which features to build and focused on only adding functionality that users were willing to pay for. With our previous product, we built all sorts of shiny new features because users were asking for it.
We both read the Lean Startup when we were first getting started in 2015. Since we never took venture money, it became really important for us to ship and iterate on the product quickly. Those principles seem like common sense to us now, but when we were starting out, it took a lot of practice before we were comfortable releasing ugly MVPs for early feedback.
I really enjoy reading the Farnham Street blog (also Knowledge Project podcast). Shane talks a lot about decision making, mental models, and interviews really interesting people that are experts in different fields.
We also like Buffer’s open blog. We were building Wavve as a remote team and Buffer was one of the first companies to publicly write about it. They’re radically transparent and share information around salaries, business metrics, and how they navigate leadership decisions. We’ve also found Baremetrics’ blog helpful at various times. There’s a lot of great advice around the challenges of building a SaaS business. They also share some amazing Google Sheets for things like marketing planning, financial projections, etc... Eventually, we became a Baremetrics customer, and we really love the product. Their reporting data has helped us get a clear birds-eye view of our business health and we’re able to make more accurate forecasts about future growth.
Advice for other entrepreneurs who want to get started or are just starting out?
I think I’ve learned more in the last few years than I have my whole life. I will stick to learnings specifically related to starting a bootstrapped SaaS business:
Get Ready to Play the Long Game
If you are like every other entrepreneur, you will judge your progress by the month or even the week in some circumstances. It will always feel like you are behind or not moving fast enough. Instead, you need to judge your progress by years, because that is how long it takes to accomplish anything of importance.
Don’t get me wrong: You still need to move fast and with a sense of urgency… but don’t let one or two slow months break you down or stop you from pursuing what you think is a good business/product idea. Doing part-time and contract work is a great way to extend your runway and give yourself the time needed to see a project through to a certain point.
Transition from “My idea” to “How can I solve your problem?”
Treat your idea exactly for what it is: an idea. Now quickly turn that idea into something tangible that can be given to potential customers and tested for feedback. From this point forward, it’s no longer your idea. It’s either a solution to their problems or it’s not. Don’t romanticize your idea just because it’s yours.
Work on marketing as much as you do product.
Building an MVP isn’t hard. Getting your first initial users/customers can be tricky but it will come. Aligning product, business model, and marketing channels so they all work in unison for growth is really f***ing hard.
Too many entrepreneurs focus solely on building their product and either neglect marketing or don’t put in the work to attract the right type of customer. (Spending months attracting the wrong type of customer was a huge mistake I made). Figure out what pillars your business needs to succeed/grow and focus on all of them.
Learn how to prioritize properly.
I thought entrepreneurship was going to be about learning how to get more shit done.
It’s actually about learning how to determine what needs to get done next.
There will always be a dozen things that have to get done immediately. If you try to do them all, you will either go broke or do a half-ass job. Use that constraint to focus and determine what actually needs to get done to move forward.
Where can we go to learn more?
- Lofi Ventures, we are launching other products and will blog about our experience
- Twitter @bairdhall, @nickfogle, @robmoore
Hey! 👋 I'm Pat Walls, the founder of Starter Story.
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