0:00 Everyone always asked, "How do I scale 0:01 my newsletter faster?" [music] The 0:03 shitty answer is it's a combination of 0:04 doing five, six, seven things really 0:06 well consistently. 0:07 >> That's Tyler Denk, co-founder and CEO of 0:10 Beehiiv, the newsletter [music] platform 0:11 powering some of the world's biggest 0:12 creators, publishers, entrepreneurs, and 0:15 media brands across the globe. 0:16 >> When we want to drive results, whether 0:18 it's to an advertiser, to our community, 0:20 to an IRL event, it's all the 0:21 newsletter. 0:22 >> In this episode, [music] Tyler breaks 0:23 down the importance of owned 0:24 distribution and the step-by-step 0:26 playbook to grow and monetize a 0:28 newsletter. 0:29 >> If you can't take [music] your audience 0:31 and your content and your subscriptions 0:32 from one platform to another, then 0:33 you're stuck. 0:42 >> So, Tyler runs Beehiiv, a nine-figure 0:45 brand commonly known for its email 0:48 newsletters. I'm staying till the end 0:49 where we're going to give you guys that 0:50 full playbook, but I want to start with 0:52 Big Desk Energy. 0:54 >> It's the best newsletter in the game 0:55 now. 0:56 >> Five hours a week, six figures using 0:58 your own product. I want to dive into 1:00 that playbook, really talk about growth 1:02 and monetization. There's a lot of 1:03 people out there that would love to have 1:04 a six-figure side hustle. So, let's kind 1:07 of go through that playbook that got you 1:08 to 120,000 followers. Take me back to 1:10 zero. How do you actually kind of build 1:12 the hype and awareness to launch a 1:14 newsletter? 1:15 >> Also, let's take a step back and say 1:16 what Big Desk Energy is. Now, it's it's 1:18 right now it goes to 130,000 startup 1:21 founders. It's a behind-the-scenes look 1:24 of what I'm doing building the business. 1:25 So, my thesis is most founders don't 1:29 actually share the secret sauce of how 1:31 they're building a company. A lot of 1:33 Silicon Valley and startups are this 1:35 like information silo. If I'm doing 1:37 well, I don't want my competition to 1:39 know what's working for us cuz that's 1:41 increased competition. I believe and 1:43 I've built the company incredibly 1:44 transparently from the first day. So, 1:47 you follow me on X, you see that I share 1:49 our revenue numbers, I share the ups, 1:51 the downs, and Big Desk Energy is 1:53 basically what you see on social on 1:55 steroids. It's a 1,500 word essay behind 1:59 the scenes of how we're raising money, 2:00 how we're what features we're launching, 2:03 how we run board meetings, how I run a 2:05 remote company of 130 people, how much 2:07 revenue we're generating, and kind of 2:08 like all of the stuff that most people 2:11 don't see from the outside of building a 2:13 startup. So, that's what Big Desk Energy 2:15 is. 2:16 >> Very intimate, very personal. I mean, I 2:18 just saw you that had that White House 2:19 dinner, like showing your personal life 2:20 as well, too. So, it's very unique to 2:21 you. 2:22 >> Well, which I I've never put myself in 2:24 the position of like I'm a creator, and 2:25 it's never really been about me, but 2:27 I've actually found the content that 2:28 most of the audience likes a lot is how 2:30 do you do what you do? And it's like a 2:32 like a day in the life, or a week in the 2:34 life. So, when we sponsor Cannes and go 2:36 to the Cannes Lions event, when we go to 2:38 the White House Correspondents Dinner, I 2:40 recap kind of my week, the meetings I'm 2:42 having, what it's like to be a CEO of a 2:45 quickly growing startup, and I think 2:46 there's a lot of interest in that type 2:48 of content. So, it's kind of how I 2:49 backed into it. 2:50 >> Founder-led distribution. 2:51 >> It's all founder-led content. 2:53 >> Yeah, for sure. 2:53 >> And it started on X, and it started on 2:54 LinkedIn. 2:55 >> And from the summer when I first started 2:58 building Beehiive as a side project, I 3:00 was building momentum of here's where 3:02 the gap is in the market. I was building 3:04 credibility. We just scaled Morning Brew 3:07 to 4 million readers. We got acquired 3:09 for $75 million. 3:10 There's this new startup called a 3:12 Substack that just raised at a $65 3:14 million valuation, and I think what we 3:16 built at Morning Brew is so much more 3:18 powerful than what they were offering. 3:21 Then when you look at all the 3:21 incumbents, whether it's Mailchimp, 3:23 Campaign Monitor, Sailthru, like legacy 3:26 post-acquisition incumbent email 3:28 software providers that I knew 3:29 intimately well from my time at Morning 3:31 Brew. 3:31 >> Slow. The slow boys. 3:33 >> No no no hustle, no reason to listen to 3:36 users, long annual contracts, not 3:39 actually building a platform that puts 3:41 their users in the best position to 3:43 succeed. 3:44 And so, as Beehiive is just a side 3:46 project for me and my co-founders, we 3:48 kind of need to like be testing our 3:49 language, or build some momentum, share 3:51 why we believe what we're building is 3:53 going to be the next big thing. And so 3:55 that's how I kind of backed into 3:56 building in public. It was 3:58 I think the referral program could be a 4:00 massive growth driver for newsletters. I 4:02 did it at Morning Brew, it led to over a 4:04 million subscribers. I want to build it 4:06 so any newsletter in the world can have 4:07 access to what we had at Morning Brew. 4:09 So I'd tweet that. And then I tweet 4:11 random stuff like 4:13 I think the third Friday of every week 4:14 should be a monthly wellness day where 4:16 it's a three-day weekend, you recharge, 4:18 you work, you don't have meetings, do 4:19 whatever you want to do. And so I 4:21 started this whole build in public 4:22 persona and that's how I grew my 4:24 following from 2,000, 3,000 followers to 4:26 now I think across platforms like 100, 4:28 150,000. 4:29 >> And this is without a newsletter. This 4:30 is without a newsletter. You are running 4:31 a newsletter company. You 4:32 >> This is even before we launched the 4:33 company. It was Again, I backed into 4:36 founder-led marketing. Like it was 4:38 really me just testing the waters of me 4:40 being very excited about what we're 4:41 building, sharing it on X and LinkedIn, 4:43 and seeing that there's a huge appetite 4:45 for what we are building and even bigger 4:46 appetite for how do you take this idea 4:49 which everyone has tons of ideas in 4:50 their life and actually turn that into a 4:52 business. And I have people that have 4:54 been following me from when when Beehiiv 4:55 literally was just an idea of like that 4:57 first tweet and have seen it all the way 4:59 up to the 50 million in revenue that 5:01 we're going to do this year. 5:02 I think that's really exciting as a 5:04 content category. It's business 5:06 creation, it's entrepreneurship. But 5:08 again, going back to my initial thesis, 5:09 everyone keeps it so close to the chest. 5:10 They're so scared of other people 5:12 sharing the secrets that makes them 5:14 successful. 5:15 And so there's a lot of alpha in the 5:17 transparency of when we lost we 5:19 tragically lost my CTO and co-founder. 5:22 I've shared that story many times. I 5:23 share it every year. We've almost failed 5:25 four or five times where I didn't think 5:27 we were going to be able to get out of 5:29 whatever rut we were in because of 5:30 either that instance or the many other 5:32 mistakes that we made along the way. 5:35 And I think because once you're on that 5:36 venture flywheel, you have to give the 5:38 perception that everything's perfect, 5:40 everything's up into the right. And 5:42 we've been very fortunate that we 5:43 haven't had a down month. Every month 5:45 has been up into the right. But that 5:46 doesn't mean there's a [ __ ] ton of 5:47 things that have gone terribly wrong. 5:49 And I have owned all of that. And I 5:51 think that has really been the alpha in 5:53 the content that I create. I'll own all 5:55 of the mistakes that we've made. I'll 5:57 own when I'm extremely burnt out and 5:59 struggling for motivation. And I think 6:01 that makes me more relatable to other 6:03 founders who look up to that type of 6:04 content. 6:06 And I don't fear the retribution of 6:08 investors thinking that one thing or 6:10 another that everything is perfectly 6:12 fine within the the org. That's what Big 6:15 Desk Energy before the newsletter, it 6:17 was just me creating content on X and 6:19 LinkedIn sharing. 6:20 But you can only go so deep with 140 or 6:23 280 characters. And so 6:25 Big Desk Energy became Well, first it 6:27 was a Spotify playlist. It's the best 6:28 playlist that you can listen to. 6:30 >> I've listened to it before you came in. 6:31 >> Yeah, it's 25,000 followers on Spotify. 6:32 It's the best work playlist. 6:34 >> That's actually a very unique piece of 6:35 the flywheel that you can get people 6:37 either or make them stickier and or 6:39 bring them in through that. But we'll 6:40 get to that here. 6:40 >> Yeah, yeah. No, I mean I think I like to 6:42 say that I'm the first person that has a 6:43 Spotify playlist to newsletter to media 6:46 company pipeline. I don't think that's 6:47 ever been done before. 6:48 >> I don't think so. I don't think so. 6:49 >> it started off as a Spotify playlist 6:52 with a cool brand. So Big Desk Energy 6:53 retro Windows 98 theme. 6:56 And then I just think it was November of 6:58 '23 7:00 where I had a little bit of time during 7:01 Thanksgiving break and I was like I'd 7:02 love to actually write a newsletter. 7:04 I've tons of thoughts. I've done the 7:05 build in public thing on social. And 7:08 I've always wanted to build a newsletter 7:10 for many reasons. One, I've seen the 7:11 success. I've seen all of the people on 7:13 our platform that had an idea who had 7:15 small audience and are now making 7:16 hundreds of thousands if not millions of 7:17 dollars in revenue. So I know the secret 7:19 sauce. I know how to build and scale a 7:21 newsletter from Morning Brew and 7:22 everything that I've built. And I 7:23 obviously sit in a fortunate situation 7:26 and position of seeing the success on 7:28 the platform of what's working for 7:29 certain types of content creators. 7:31 And when I initially went to launch in 7:32 November, I had zero subscribers and I 7:34 first started with like a preview of I 7:37 will not launch this till I have a 7:38 thousand subscribers. So pre-launch 7:40 hype, put it on X, put it on Instagram, 7:43 put it on LinkedIn, be obnoxious, say 7:44 that I've been working on something that 7:45 I'm really proud of, but I'm not 7:47 releasing it till I have a thousand 7:48 subscribers. Took about three weeks. I 7:51 launched it the first week of January. 7:53 And then there's just so many other 7:54 growth strategies to scale. 7:56 >> So, so you did so you did a waitlist, 7:57 basically. 7:58 >> a waitlist. If you want to see this 7:59 exist in the world, and I'm obviously 8:01 I'm I'm good at marketing it. It's 8:02 everything that happens behind the 8:03 scenes. If you want this inside look at 8:05 what it's like to build a high-growth 8:06 startup, I need a thousand subscribers 8:08 before I launch this. And so I had a lot 8:10 of people in the early waitlist promoted 8:12 to other people. So we had a little bit 8:13 of like an organic flywheel. 8:14 >> And for the operators out there, it's 8:16 probably just giving a little before 8:18 you're obviously building in public via 8:19 Twitter and LinkedIn. It's probably 8:20 giving, you know, probably 30, 40 posts. 8:23 Just give them a little taste of what it 8:24 looks like. Almost like a preview into 8:26 this. 8:27 >> Yeah, honestly. 8:27 >> to give them just got to give them a 8:28 reason. 8:29 >> Yeah, and and that's what that's I'd say 8:31 everyone always asks, "How do I scale my 8:33 newsletter faster?" And the shitty 8:35 answer is like there is not a silver 8:37 bullet. Like there's definitely 8:38 different strategies and things you can 8:40 do, and I'm happy to walk through all of 8:41 them. 8:42 But there's not one that leads to 8:44 hypergrowth. It's typically the 8:46 combination of doing five, six, seven 8:49 things really well consistently that 8:51 turns into 10 subscribers a day to 20 8:54 subscribers a day to 30 subscribers a 8:55 day to really hit that escape velocity 8:58 to reach scale for a newsletter. So, the 9:00 pre-launch hype, easy, anyone can do it. 9:03 Over-indexing on the channels that you 9:05 can already access for free. So, X, 9:07 LinkedIn, Instagram. Like most people 9:09 have some bit of a network on all of 9:11 those and just leveraging that. The next 9:13 thing, so Beehiiv has a feature that is 9:16 an email gate. You can do a pop-up, 9:18 which everyone knows what a pop-up is. 9:19 You read an article, it pops up, you get 9:21 it you get rid of it. There's an email 9:23 gate, which is just a much more strict 9:24 pop-up gate, which means you scroll, you 9:26 can only see two to three sentences, and 9:28 there's a hard gate where you have to 9:29 put your email in. Every piece of 9:31 content that I create has an email gate 9:33 on it, which means I'm driving traffic 9:35 to content both from social and 9:36 elsewhere. And if you want to read past 9:39 the second line, you have to put in your 9:41 email. 9:42 >> This This is undefeated. I think I get 9:43 so aggravated when I someone sends me an 9:45 article, I e. raised money, and it's 9:47 like Business Insider or something, and 9:48 I get that gate. And they make you pay, 9:50 and I'm like, "Fuck it, I'm not paying." 9:52 But for something like this, where 9:53 you're not charging, I would imagine the 9:55 conversion rate with this gate is is 9:57 >> you've already clicked through to see 9:58 like if I already said, "Here's a crazy 10:00 week at the White House Correspondents 10:02 Dinner." I post that on Instagram. 10:03 You've I've gotten your attention. You 10:05 click on it. And then you have to put in 10:06 your email. I make it clear that it's 10:07 free. You just have 10:11 to put in your email to get access. 10:12 Conversion rate is crazy high. 10:15 >> Guys, next 3 days, that's a definite 10:16 thing right there for the lead magnets. 10:17 I like that. Then it's like a lot of 10:19 like 10:20 >> easy things. So, I send my newsletter 10:22 every Tuesday morning. On Monday night, 10:24 I preview what I'm going to write about, 10:26 get a lot of people's attention, post it 10:28 on all my social channels, and drive it 10:30 to the subscribe page. Not rocket 10:32 science, but gets a few dozen new 10:33 subscribers just saying like, "This is 10:35 what I'm writing about tomorrow. Be the 10:37 first to get in your inbox. Sign up 10:38 here." 10:39 >> So, it's basically it's like the 10:41 pre-gate before the pre-gate. So, it's 10:42 just all these 10:42 >> And then we publish on Tuesday, and then 10:44 I have the content already written, and 10:45 I give you a cliffhanger of you'll never 10:48 like I'll I'll just keep using the White 10:49 House Correspondents Dinner cuz I was in 10:50 an active shooter environment and under 10:52 a table. 10:53 >> Insane. 10:53 >> Yeah, so easy to create content for 10:55 that, and I was like, "Hey, White House 10:57 Correspondents Dinner was one of the 10:58 wilder experiences, like an interesting 11:00 first one. If you want to read about my 11:02 week in DC, click here." I already have 11:05 their interest. They click on, they get 11:06 the email gate. So, there's like the 11:08 pre-post type, which is like Monday 11:10 night for me, and then there is the I've 11:12 already published it cliffhanger, 11:14 clickbait, whatever you want to say, 11:15 that with the email gate. And that's 11:17 just on rinse, wash, repeat, right? 11:19 >> just going on full offense on Tuesday. 11:20 You'll tweet about it once, maybe even 11:22 more times, looping back to that to just 11:24 really hit that window, because it's out 11:26 of sight, out of mind the next week, 11:27 quite frankly, correct? 11:28 >> can take your content, and a great use 11:30 for the MCP is like, "Hey, can you take 11:32 this article that I've already put 5 11:33 hours into writing and create a tweet 11:35 thread with that that will break that up 11:37 into like an engaging five six tweets." 11:39 So, then you just repurpose that content 11:41 on Wednesday or Thursday. 11:43 But instead of giving the entire post in 11:45 a thread, give the first three to four 11:47 and be like, "For the rest, click 11:48 through." For everybody out there 11:49 listening to our AI guys, they have a 11:50 new MCP which is absolutely amazing. 11:52 Stay tuned. We're going to get into that 11:53 very very deep. 11:54 >> Yeah, cuz it's it's doing so much work. 11:56 >> It's it's amazing. For us right now. 11:58 >> What about these referral programs? Tell 11:59 me a little bit more about those. 12:00 >> Yeah, so context of the referral 12:02 program, back when I was at Morning 12:03 Brew, we built 12:05 a referral program. And and and what a 12:06 referral program really is is 12:08 you have you already have your audience. 12:10 You I have 130,000 people that are 12:12 opening my emails and reading every 12:13 week. How do I engage and incentivize my 12:16 existing audience to refer more people? 12:19 And we did it extremely well at Morning 12:21 Brew. We offered coffee mugs, t-shirts, 12:23 exclusive content on Sundays, a 12:25 community at 10 referrals. And everyone 12:28 has their own referral link. You as a 12:31 reader of Morning Brew or Big Desk 12:32 Energy, you enjoy the newsletter and for 12:35 one referral, you get access to X. For 12:37 five referrals, you get access to 12:39 something else. 12:40 So, it worked extremely well for Morning 12:42 Brew. We we grew by over a million 12:44 subscribers from people who came in from 12:46 referrals. 12:47 >> Damn. 12:48 >> Which is crazy. And so, 12:49 >> And you And ultimately, it's like a You 12:51 want to obviously keep your cost basis 12:52 as low as possible. You want to give out 12:53 as much free stuff as possible. But if 12:54 you can create almost like a a little 12:56 mini pyramid at the at the top, you 12:58 know, you'll fly them out to go to this 12:59 game. You can create as big as you want. 13:00 A big as A big spectrum. 13:01 >> And so, that's kind of like what we did. 13:02 The most important thing to realize is 13:04 you have to have a brand for people to 13:06 want to go out of their way to share 13:08 your content with someone else. So, 13:09 Morning Brew had an amazing brand. I 13:11 actually say that was probably the most 13:13 important differentiator for Morning 13:14 Brew is you can read the Wall Street 13:17 Journal or Yahoo Finance, but Morning 13:19 Brew actually stood for something for a 13:20 certain amount of people. And getting a 13:22 t-shirt with the Morning Brew logo or 13:24 sticker or whatever actually said 13:25 something about that type of person. So, 13:27 Morning Brew built an amazing brand or 13:29 you could lead with value. And so, I 13:31 write to the 130,000 founders. One of 13:34 the rewards that I give at one referral, 13:37 you get access to my Series B deck. So 13:39 again, total through line with 13:41 everything I said earlier, most founders 13:43 don't share how they raise capital or 13:45 their numbers or how they actually raise 13:47 this 33 million dollar Series B. And I 13:50 tell you if you refer just one person to 13:52 my newsletter, I'll send you that deck 13:54 totally unedited raw. So, useful for 13:56 >> Good dangle, right? That's nice. 13:57 >> for any So, for any founder who's seed 14:00 stage Series A who wants 14:02 that type of, you know, insight into 14:04 like what does a Series B deck looks 14:06 like that actually works from a company 14:08 that I respect, from a founder that I'm 14:09 already reading about every week. 14:12 And so, it's one referral. 14:13 >> And I I would put that under kind of the 14:14 lead magnets universe. But that's like a 14:17 a lead magnet on 14:18 >> It's a lead magnet for your existing 14:20 readers who already have an affinity for 14:21 you cuz they're already reading your 14:22 content. And so, my goal with the 14:24 referral program is of the 130,000 14:27 people, how many can I get to like my 14:29 content enough 14:30 and be incentivized by whatever reward 14:32 that I'm offering for them to copy their 14:34 link and put it in their group chat or 14:36 recommend their friend or their mom or 14:37 their co-worker or their co-founder. And 14:39 that's kind of the name of the game for 14:40 the referral program. 14:42 >> The big desk energy vibe, we're going to 14:43 pop this up. The aesthetic is crazy 14:45 vibey. 14:46 That'd be That'd be That'd be some I'm 14:47 not even going to call it merch. That 14:48 would be some good products. 14:49 >> Well, I have merch as well. And so, that 14:51 at three So, I only have two incentives 14:54 in my referral program. One is the 14:56 Series B deck at one, which I actually 14:58 think and you kind of alluded to this 14:59 earlier. Like the game is how do I offer 15:01 as much value for as little cost? Yeah. 15:03 So many people go into I'm going to ship 15:05 them a t-shirt and a crew neck and a 15:06 hat. Like that's cool, but now you're 15:08 also dealing with buying actual physical 15:11 goods, shipping them, people claim they 15:13 don't get it, you have to send them 15:14 another one. There's like there's costs 15:15 involved. What we did at Morning Brew 15:17 was at three referrals, you got access 15:20 to our Sunday newsletter called Light 15:22 Roast. 15:23 It was a hit because it cost us 15:24 absolutely nothing to produce. It was 15:25 someone's It was a writer's time to 15:27 create a an additional newsletter. 15:28 >> Which gets amortized to pennies once 15:31 it's done. 15:31 >> And everyone already on the list 15:32 obviously wants more business content 15:34 cuz they've already signed up for 15:35 Morning Brew. And if they're already 15:36 going to refer someone else, like 15:37 there's a high intent that they want 15:39 more content for whatever reason to be 15:41 competitively to to be in the know, to 15:43 understand whatever you want to get. 15:45 >> We are not doing this. We are idiots. 15:47 This is a This is a easy easy low-left 15:49 one that we have to be done. And we have 15:51 so much 15:52 especially free stuff to offer, like 15:54 unique one-of-one information that we 15:56 can just stack the deck here. 15:58 >> And and so one of the examples that I 16:00 always use and I got a lot of 16:01 inspiration for mine was Milk Road, 16:03 which was a crypto newsletter. 16:04 >> Of course, Uncle Ben. Uncle Ben Uncle 16:06 Ben and Uncle Shawn. 16:07 >> They launched their newsletter, I want 16:09 to say in January of 2022. They got 16:12 acquired for seven figures eight months 16:15 or 10 months later. 16:16 >> Yeah. 16:17 >> And so they figured out this crazy 16:19 flywheel of how to grow as quickly as 16:21 possible, but they did the referral 16:23 program. And because you're reading Milk 16:26 Road, because you're interested in 16:26 crypto, they said for one referral, 16:28 we'll give you a guide of what 15 crypto 16:31 experts think is going to happen in 16:32 2022. So like the the alignment of 16:35 incentive and people who are reading the 16:37 newsletter is one-to-one. And because it 16:39 was free, it took them I think eight 16:40 hours like one afternoon to create that 16:42 guide. I think it led to 30,000 16:44 subscribers and so 16:45 >> We are ideating right now for ourselves. 16:47 >> a live session here. 16:48 >> This is This is amazing, yeah. No, we do 16:50 uh the lead magnets are absolutely 16:51 great. We'll put one down below, but I 16:53 feel like we have so much the 16:56 the pattern recognition across all of 16:59 the episodes, we have so much 17:00 interesting information and we could 17:01 double click on any topic, whether it be 17:04 hiring, firing, marketing, digital 17:05 marketing, sales. So we can give codes 17:08 based on that. 17:08 >> MCV, too. Take the transcript and have 17:10 the MCP spit it out. 17:12 >> Love this. On the growth side, what 17:14 else? You're talking about referrals. I 17:15 see often on newsletters referring kind 17:17 of other newsletters. Talk about like 17:19 the the the cross-pollination of 17:21 utilizing other newsletters to grow 17:22 yours. 17:22 >> Yeah, so there's two things. We have a 17:24 recommendation network, which is exactly 17:26 what it sounds like. You can recommend 17:27 other newsletters, they can recommend 17:28 you. The key there is you get a hub of 17:31 other newsletters who are not 17:33 competitive with you, but are like 17:35 tangential. So, I write about startups, 17:37 there's other startup or creator-focused 17:39 newsletters that I recommend. In return, 17:41 they recommend me. And so, everyone who 17:43 signs up to my newsletter, as soon as 17:45 they put their email in, a little pop-up 17:47 comes up and says, "Here's four 17:48 newsletters that me, Tyler Denk, are 17:50 recommending that you should check out." 17:52 >> a barter system, or is everything for 17:53 free? 17:53 >> Everything's for So, there's both. 17:56 There's a altruistic free, I recommend 17:58 you cuz I know you're recommending me 17:59 back, and when you grow, I grow, and 18:01 vice versa, so it's good for all of us. 18:03 So, that is like the recommendation 18:04 network. Then we have something called 18:06 Boost, which is exactly what it sounds 18:07 like. It's boosted recommendations, so 18:09 you can put money behind it, and 18:12 pay other newsletters in the ecosystem 18:14 to recommend you. And so, like I have 18:16 You could selectively decide who you 18:18 want. 18:18 >> They need to say that they're offered 18:19 and willing to do that. 18:20 >> So, for example, for me, I have a boost 18:23 offer for $3. And I'd say that any 18:26 newsletter on the Beehiiv platform that 18:28 wants to recommend Big Desk Energy can 18:29 apply to recommend me. I get a full 18:32 download of who you are, what's your 18:34 audience size, what's your content. Like 18:36 if you're writing about sports, it might 18:38 not be a good fit for my newsletter, 18:39 right? Or but if you're writing about 18:40 business or tech or startups, then it's 18:42 probably a better fit. 18:43 >> This is where value of audience becomes 18:45 >> So crazy cuz you can charge a premium if 18:47 people want your readers. 18:49 >> Right. And so, you could sign on to 18:50 Beehiiv, you could see that Big Desk 18:52 Energy is offering $3 per subscriber. 18:54 It's great a revenue opportunity for you 18:56 cuz you know you're making you are 18:57 growing 100 subscribers a day. And if 18:59 half of them, so 50 of them, actually 19:01 opt in to my newsletter, you're making 19:03 $150 every day, hands-off, not doing 19:06 anything. So, why it's so powerful is 19:08 it's revenue for one side of the market, 19:10 revenue for your newsletter, and it's 19:12 growth for me. You're sending me emails, 19:14 I'm paying you $3. 19:16 And what we built is we built a lot of 19:17 different mechanisms to protect and like 19:20 make sure that they're actually 19:21 verified. And so, I only actually pay 19:23 for subscribers who are opening emails. 19:25 So, it's kind of like kind of like 19:26 paying for Facebook ads where you only 19:28 actually pay for customers who buy 19:30 something. Like I'm only the $3 only 19:32 goes from my account to your account if 19:34 the email that you sent me is actively 19:36 opening my emails. So, it's risk it's 19:38 totally risk-free. 19:39 >> So, you guys create very very safe 19:40 parameters on the back end. Do we Do we 19:42 get to control those parameters or you 19:43 guys just set it? 19:43 >> a black box cuz once you let the user 19:45 control them, then you can kind of game 19:47 the system. So, we have like a bunch of 19:49 different mechanisms to track like this 19:51 is for all this is like a [ __ ] 19:52 email. This is this person's not 19:54 engaging or this person's opening every 19:56 email and clicking and it's not 19:58 suspicious, thus it's a real subscriber. 20:00 >> And this is no friction and it's after 20:01 the fact. Like someone has subscribed 20:03 and then they're getting like a pot Like 20:04 it's it's it's no friction. 20:05 >> You sign up for Big Desk Energy, you see 20:07 who I'm recommending and vice versa. So, 20:09 those are like the two different flavors 20:10 of like the network effects that we 20:12 have. We have 55,000 active publishers 20:14 in the ecosystem. And so, you can 20:16 benefit from this recommendation network 20:18 where some people recommend you and vice 20:20 versa. Or if you're willing to put money 20:21 behind it, you can pay $2, $3, $4 per 20:24 lead and emails will then be sent to you 20:26 from whoever you approve that can do 20:28 that boost recommendation. 20:31 >> I feel I feel like that is safer. Like I 20:33 know people that play the game and they 20:34 play like the meta game where obviously 20:36 there's way more to it. You have to 20:37 monitor it, you have to create the 20:38 creative. How good is that email, 20:41 period? Quite frankly. And this is like 20:44 pre-vetted that you'd probably pay 20:45 >> Just hyper-focused for email, right? 20:47 Like we you have we have a mechanism 20:49 where you can auto-approve one. So, if 20:50 you're like if they have a 40% open rate 20:52 and higher, they're based in the US and 20:53 they write about business, I don't even 20:54 want to like approve it. Just like know 20:56 that that's good. And so, it's like 20:57 autopilot. And then inversely, you can 21:00 set it up so 21:02 like every newsletter is very different 21:03 in terms of quality and how good their 21:05 list is and what type of leads they're 21:07 going to be sending you. And so you can 21:08 like auto clean it as well. So if your 21:10 newsletter sending me subscribers and 21:12 their open rates to call it 20%, I can 21:14 say anything below 20% just cut off that 21:17 thing and then you can no longer send me 21:18 more emails. 21:19 >> Guys, we need 40% plus. 40% plus is the 21:21 benchmark. 21:21 >> Exactly, for sure. 21:22 >> 20% is down the [ __ ] dumpers. 21:24 >> Yeah, hey, just an example but yeah, 21:26 totally agree. 21:27 >> When you kind of look at all these 21:29 things like in a pie, I imagine that is 21:31 just like a crazy flywheel. On the lead 21:33 magnet side, I feel like for everybody 21:35 out there listening that wants to start, 21:36 it's like what do you have that is such 21:39 high value that is uniquely you, one of 21:41 one, i.e. this money raise deck and you 21:43 obviously have social proofing around 21:45 it. You've raised, I don't know, 30, 40 21:46 million dollars. How big has that single 21:49 lead magnet been as far as like 21:52 in your growth? Is it 15% 20%? 21:54 >> so the two other levers that I get to in 21:57 growth, one is lead magnet so I'd 21:58 separate referral program. I use a lead 22:01 magnet for the referral program but 22:02 referral program is me incentivizing 22:04 existing readers to share with other 22:06 people. 22:07 Beehive also has a full website builder 22:09 and so you can build custom landing 22:11 pages, multiple landing pages, lead 22:13 magnets, 22:14 interactive web pages, like whatever you 22:16 want. It's a full website builder with 22:17 like an AI integration as well. So you 22:19 can just chat with AI and say 22:21 you can upload a screenshot of your 22:22 favorite website. Be like, I want my 22:23 landing page to look just like this but 22:25 in my brand and my colors and it can do 22:27 that in a few seconds. So with the 22:28 website builder comes a whole world of 22:30 possibilities where you can build 22:32 different lead magnets. And so I'm 22:34 running lead magnets for our seed deck. 22:36 So the series B is like the referral 22:38 program. If you want access to our seed 22:40 deck where we raised two and a half 22:41 million dollars, then you just put in 22:42 your email and I run ads to that as 22:44 well. If you want we we're running a a 22:46 remote company of 130 people. If you're 22:48 curious how to run a remote company, I 22:50 have a remote playbook and you can go to 22:52 that landing page. You put in your email 22:53 and I email it to you. 22:55 >> Boys, more lead magnets. Let's next 22:57 three days. 22:58 >> So lead magnets are one massive thing 23:00 that I do for growth and then I would 23:01 say ads, which is what everyone of every 23:04 newsletter at scale eventually gets into 23:06 the paid acquisition game. You just 23:08 can't hit escape velocity unless you're 23:10 mega viral and can constantly create 23:12 such amazing content that you can drive 23:13 a ton of traffic. I think every 23:15 successful newsletter that I know 23:16 eventually gets into paying mostly meta 23:19 for different ads either to your landing 23:22 page or to your lead magnets. And so 23:24 landing page like just the subscribe 23:26 page, there's no button, there's nothing 23:27 to do except for subscribe. And then you 23:29 just lead with social proof however you 23:31 want to or however I want to promote Big 23:33 Desk Energy. Or you use a lead magnet 23:36 and say, "Hey, I raised two and a half 23:38 million dollars and this is the exact 23:39 deck that I used, totally unedited, 23:41 totally raw. Put your email in and 23:43 you'll get it sent to you." And so then 23:45 I'm kind of grouping together paid 23:47 acquisition with lead magnets. 23:49 >> We got to get you on that ManyChat 23:50 steroids. I don't know I don't know how 23:52 they're not a partner of this. I'm like 23:53 literally the mayor of of ManyChat. I 23:55 love it. It does this all automated. 23:57 Quick break and it's a big one. In the 23:59 coming weeks we are doing a live and 24:01 free email workshop with Beehive. Me, 24:03 Tyler, the Beehive team, and some of the 24:05 world's best email operators in the 24:07 world are going to walk you through how 24:08 we grow and monetize [music] 24:10 our email. This is the same exact 24:11 playbook that Open Residency uses to run 24:13 our newsletter and you're going to get 24:14 the same playbook at no cost. And 24:16 remember, your Instagram does not belong 24:18 to you. Your YouTube does not belong to 24:20 you. Your email list does. Stop renting 24:23 your audience and start owning it. 24:26 The reality is is this is all backing 24:28 into I mean you're putting a lot of 24:29 dollars behind it. I mean if you're 24:30 talking about referrals two, three 24:31 dollars, meta, let's just say it blends 24:33 out to two, three, four dollars. You 24:34 have to make money on the back of that. 24:36 What are the actual ways to monetize a 24:39 newsletter? Ultimately this has to be a 24:40 profitable business here. So how do you 24:42 make money doing this? 24:43 >> I think it's also worth the the hit on 24:44 how much I am spending cuz I just tossed 24:46 out a bunch of different numbers. 24:47 Probably spend $5,000 a month on ads on 24:51 meta. 24:52 And I probably put three to $5,000 a 24:54 month into that boost network. So about 24:56 call it $10,000 a month that I'm putting 24:58 in. So, cost are 10,000, platform's 25:00 negligible after the fact that I'm CEO, 25:02 but but it it it would still it would 25:03 still work. We're we're very We're very 25:05 efficient cost-wise. So, $10,000 are my 25:08 cost. So, like at to run a profitable 25:09 business, I need to make more than 25:10 $10,000 a month in revenue. 25:14 And that discounts like all of the 25:16 second and third order effects of like 25:18 how the newsletter benefits my business, 25:20 right? All of our a lot of our users 25:22 read my newsletter. We've gotten tons of 25:24 enterprise users from reading my 25:25 newsletter. So, like me breaking even, I 25:27 consider to be a win. 25:29 >> I mean, hypothetically, this could be a 25:30 loss later and you're going to win on 25:32 the second and third effects, for sure. 25:33 >> Totally. Totally. But how I actually 25:34 make money, just ignoring the second and 25:36 third order and like focusing on the 25:37 newsletter, there's a few different 25:38 ways. I think the most common is 25:40 advertisements. And so, you can do 25:42 advertisements a few different ways. 25:44 Morning Brew, we had, you know, 3-4 25:46 million readers and we were able to get 25:48 brands like Apple and Visa and 25:51 Mastercard to spend $70,000 to get in 25:53 front of a single newsletter because 25:55 they're reaching so many people. I think 25:57 that like set the model for how to do it 25:59 at mass scale. When in reality, we're 26:01 seeing so much success in these like 26:03 niche B2B areas where you only need If 26:06 you If you wrote a newsletter to 5,000 26:08 CMOs, that audience is so valuable, the 26:10 amount of companies like HubSpot that 26:13 would spend an egregious amount of money 26:14 to get in front of an engaged audience 26:16 of CMOs is so high that you actually 26:18 don't really need the 3-4 million 26:20 readers that Morning Brew has to build a 26:22 very successful business. 26:23 So, the ad market has evolved quite a 26:25 bit recently. But ads are probably the 26:28 easiest way to mon- monetize your 26:30 newsletter. 26:30 >> And is this flat rate, is it CBC, CPM? 26:32 Like what what does that look like? 26:33 >> Depends. Like 26:34 full There's like a full spectrum. So, 26:36 we have something called the Beehive ad 26:38 network, which is hands-off. You don't 26:39 have to do any work. You log into 26:41 Beehive, you type in {slash} ads, and we 26:44 have an entire archive of different 26:47 advertisers. We have Roku, we have 26:50 Netflix, we have AG1, we have HubSpot, 26:52 Like brands that want to get in front of 26:54 your audience and we've we're able to 26:55 match. We know that these brands are 26:57 looking for certain types of people that 26:59 you have in your list. And so that is a 27:01 CPC or CPM model typically. So you can 27:04 get paid between two and five dollars 27:06 per click or three and seven dollars per 27:09 thousand opens are kind of like the two 27:11 main metrics for CPM and CPC. And that 27:14 is like totally hands-off. You don't 27:15 have to do sales, you don't have to talk 27:17 to anyone at AG1. You don't have to 27:19 negotiate, you don't have to do tracking 27:20 links, you don't have to report back to 27:22 them. Like it's totally one click, add 27:24 it to your newsletter, you get paid a 27:25 few weeks later. So the 20th of every 27:27 month we do payouts for every dollar you 27:30 made the previous month. 27:31 >> How much you paying out on that? What 27:32 does that look like? 27:33 >> About a million dollars a month right 27:34 now. 27:35 >> Wow. 27:35 >> And the brands crush it on there because 27:37 one we're very creator-friendly, but at 27:39 the end of the day our customer for the 27:40 ad network are the brands. They give us 27:42 a hundred thousand dollar budget for Q2 27:44 and we want to prove ROI as much as 27:46 possible. 27:46 >> I mean, that's a good look for you to 27:48 have X logo on your newsletter. 27:50 >> It's amazing. 27:51 >> A random person with a hundred followers 27:53 looks like they have a Nike sponsorship. 27:54 >> and Nike on the sponsorship they're 27:55 like, "Holy shit." And like they're go, 27:57 "I just signed up." It's an amazing 27:58 growth lever for us too, right? If you 28:00 are if you have a hundred subscribers 28:01 and you have a Nike logo in your 28:02 newsletter a week after you launch and 28:04 everyone's like, "How the hell did you 28:05 get Nike to sponsor your newsletter?" 28:07 Oh, it's the Beehive ad network. I 28:08 literally clicked one button and I just 28:09 got paid fifteen dollars for that ad. 28:11 Which is another thing we try to do. 28:12 Like one of our North Star metrics is 28:15 how many of our users are actually 28:16 generating more revenue than they pay 28:17 us. It's like the old quote of like a 28:19 platform is I'm going to butcher the 28:21 quote, but it's when everyone in the 28:23 ecosystem is getting more value than the 28:25 platform itself. 28:26 And if we can have all of our users 28:28 generating far more revenue than what 28:30 they're paying us. One it gives us the 28:32 pricing power to increase pricing, but 28:34 two like why would you ever leave if 28:36 we're actually net in the black for you 28:38 and you're making more revenue. So yeah, 28:40 the Beehive ad network is amazing or you 28:42 could sell it yourself. So ads are one 28:43 thing. I use both. So to swing it all 28:45 the way back to my newsletter for Big 28:47 Desk Energy, 28:48 um I've great inbound. So, I sell my own 28:51 ads or I'll use the Beehive ad network. 28:53 We also have something called a direct 28:54 sponsorship storefront, which is if I 28:58 want to sell my own ads, where's the 29:00 page that I can send a Nike to say, "Oh, 29:02 it's $5,000 per sponsorship." And so, we 29:04 kind of are building the infrastructure 29:06 around what it means to sell your own 29:08 advertisements. 29:10 And I'll say this a few times probably 29:11 throughout this interview. 29:13 We're like very opinionated on how our 29:15 users succeed. I think there's not a 29:17 one-size-fits-all to being a content 29:19 creator, whether you monetize with paid 29:21 subscriptions or with ads or with 29:23 affiliates or with events. We know that 29:26 one content creator can do and succeed 29:29 very differently from others, and we 29:31 don't force our business model on any of 29:33 them. If you want to sell direct, we 29:35 make no money from that whatsoever. 29:37 >> that third bucket, by the way, too. I've 29:38 never heard you say that since we spoke. 29:40 I love that that you get to Basically, 29:42 you're basically sending the one-page 29:43 PDF or a media kit direct to the brand. 29:45 >> Or it's it's a media kit, exactly. It's 29:46 like a landing page for people to see 29:49 your menu of what you're offering with 29:51 like a media kit that comes inbound. And 29:53 we make $0 from that. And like that's 29:55 totally fine. My My thesis has always 29:57 been from day one, if our users are 29:58 having success, they're growing, they're 30:00 making money, and we are helping them do 30:03 that, then we don't need to be this 30:05 predatory take rate model where we are 30:07 constantly trying to figure out how to 30:09 extract revenue. I think we're playing 30:10 the long game of we know that we can 30:12 provide the best software and the best 30:14 service without also over-indexing and 30:17 finding ways to extract revenue wherever 30:18 we need. And so, that's been our thesis 30:21 from day one, and I That's one of the 30:23 main reasons why we don't take a cut of 30:24 revenue on anything that we do. 30:26 >> So, in this bucket, the sponsorship 30:28 bucket, we talked about three. We talked 30:30 about the ad network. We talked about 30:32 you doing it directly, and then we 30:33 talked about this conduit via direct 30:35 sponsorship where you guys don't take a 30:37 cut. When you do it direct, are you just 30:39 have the ability to be a little bit more 30:42 creative and storytelling and just 30:43 charge a premium outside of the CPCs and 30:45 CPMs. Is that basically what it comes 30:47 to? 30:47 >> yeah, to answer your question from 30:48 earlier, CPM CPC is like the ad network. 30:50 The other way that's probably more 30:51 profitable for larger content creators 30:53 is like flat rate, which is you're 30:56 actually the benefit of you advertising 30:57 Big Desk Energy isn't just the clicks. 30:59 It isn't just the impressions. It's the 31:01 brand association of being in my 31:03 newsletter and me actually 31:06 saying that I get a lot of inbound, but 31:08 I chose to work with this partner cuz I 31:09 actually believe in the product. And 31:12 ideally it leads to conversions and and 31:14 revenue for them as well. 31:15 >> But that's some salesmanship there as 31:16 well, too. 31:17 >> Sure. And so and that's what we see 31:18 there there's like a barbell approach. I 31:20 think there's a the long tail of content 31:22 creators who are happy with the $3 CPC. 31:24 They know that they're going to make, 31:25 you know, $500 every single send. That 31:27 works well. And then there's the upper 31:29 end of the market that knows they have a 31:30 very premium audience and the CPM CPC 31:32 doesn't make as much sense. It is for 31:34 me, if you want to sponsor Big Desk 31:36 Energy, it's $7,000. And I think over 31:38 the course of two to three different 31:40 sponsorships, one you'll get a brand 31:42 list from me having a very loyal 31:44 audience that's very engaged, high 31:45 click-through rate, everything. And also 31:47 me sticking my neck out and saying that 31:49 this is a brand and a company that I 31:50 believe in, which is what I think all of 31:52 the larger publishers and content 31:53 creators do. 31:55 >> That's pretty crazy. It's an extra 31:57 300,000 of just net new money if you do 31:59 that one time a week. 32:00 >> Yeah, exactly. 32:01 >> Damn. Love that. So double clicking on 32:03 that direct sponsorships, the media kit. 32:05 I actually checked out your media kit. I 32:07 love it. What are some of those key 32:08 things that you think need to be in a 32:10 media kit to get kind of the sponsor 32:12 over the hump? 32:13 >> Yeah, I think you're either over 32:14 indexing on one of two things, sometimes 32:17 both. One is size, so how big is the 32:19 audience? That's the Morning Brew play. 32:21 It is we are reaching 4 million people. 32:23 The other one is like who is that 32:25 audience and like how premium, how 32:26 engaged are they? Morning Brew works so 32:29 well cuz it had both. Morning Brew, the 32:31 pitch was you can sponsor the Wall 32:32 Street Journal, the New York Times, 32:34 whatever for newsletter you can find, 32:36 but Morning Brew has 18-34 year olds 32:38 that live in coastal cities with high 32:40 disposable income that are upwardly 32:42 mobile in their career and really care 32:45 about the news, content, current events. 32:47 So, like they're the people that most 32:49 brands want to get in front of. It's the 32:50 long way of saying that. And so, you you 32:52 need to figure out are you selling like 32:54 the niche thing of like for me it's 32:55 130,000 mostly founders and early 32:58 startup employees. And so, if you are a 33:01 software vendor who is trying to have 33:04 B2B B2C companies adopt your software, 33:06 like you need to get in front of 33:07 founders to be able to sell them. And 33:09 like that's why you would come to us. Or 33:11 you can sell size. And I'm getting to 33:12 the approach we can kind of sell a 33:13 little bit of both. 33:14 But, those are the things and I think 33:16 most what most newsletters, so 33:19 maybe it's true of YouTube and some of 33:20 these other channels as well, but 33:22 to use the example of you having a 33:25 sports newsletter, say you have 100,000 33:27 people on this list. Do you actually 33:28 know who those people are? Like do they 33:30 like the NBA or the WNBA or MLB? Are 33:33 they male or are they female? Do they 33:35 live in the US? Do they live in these 33:36 types of cities? What are their hobbies? 33:38 Like email doesn't really give you that 33:40 out of the box. 33:41 You just have 100,000 emails of people 33:43 who kind of open your email to read 33:44 about sports. But, you really don't know 33:46 who they are. And so, that's actually a 33:48 big thing that we're focusing on now is 33:50 how do we hydrate 33:53 and augment all of that data to be able 33:55 to tell a publisher exactly who your 33:57 audience is. 33:58 The way that you've done it historically 34:00 is like at Morning Brew we'd send a 34:01 survey every quarter. 34:03 I have like an intake survey. So, other 34:05 feature that we built at at Beehive is 34:07 that 34:07 >> Like a little type form type thing. 34:08 >> Yeah, you can build your own survey. 34:10 Again, our thesis is a lot around 34:12 consolidation that 34:14 content creators and publishers don't 34:16 want to manage 15 different pieces of 34:17 software. And with our own survey 34:20 feature, so the way that it works, you 34:22 sign up for Beehive or you sign up for 34:23 Big Desk Energy. First thing comes up is 34:25 the pop-up. It's here's the four 34:26 newsletters that I'm recommending. 34:28 You choose you want to sign up to them 34:30 or you cancel it. The next step is a 34:32 survey where I'm like, this is what I'd 34:34 like to know about you so I can cater my 34:35 content for you. 34:37 Serves two different purposes. One, I do 34:38 want to know who my audience is. If I 34:40 can see a shift in age demographic 34:42 interest, like I would maybe change my 34:44 content to accommodate that. 34:45 >> And you could probably UTM that based on 34:47 the specific newsletter to know who is 34:48 >> And this is where MCP also comes in 34:49 great, right? They it will do all of 34:50 this. It'll take your survey responses 34:52 and and do that type of analysis of 34:53 where they came from and who's answering 34:55 what. So that there's one is like from 34:57 the content angle of understanding who 34:59 is my audience for like me creating 35:01 content for ideally them. 35:03 The other one is more self-serving is if 35:05 I know who my audience is, so I know 35:06 that I'm 70% male, 30% female. I know 35:09 the average age is like 28 years old. I 35:11 know that 60% of them self-identify as a 35:13 founder. Every all of that information 35:15 that I collect in my survey, I then put 35:18 in my media kit and that's what I'm 35:19 selling advertisers. 35:21 And so 35:22 that's the historical way of like 35:24 getting that data. We are thinking 35:25 creatively of how do we augment and 35:27 hydrate that data so we can actually do 35:28 a lot of that for you behind the scenes. 35:30 >> Man, that is literally 35:33 and again, I'm just thinking about 35:34 switching costs. Like I know that you 35:35 guys are consolidating everything and 35:37 you're already doing X and X and X here 35:38 that if you bake this in 35:41 that's huge cuz that's literally 35:42 everything. Like we keep incrementally 35:44 we're going to retouch on MCP. We're 35:45 going to get to MCP soon. It's just like 35:47 all these little things of knowing age 35:49 demographics. We now know via Spotify we 35:52 have show crossover. So we know that 53% 35:56 of you guys watching right now listen to 35:57 Diary of a CEO very very often. We know 35:59 41% of you guys like Joe Rogan. Cuz I 36:01 think every single one of those little 36:04 pieces of the pie 36:05 just make it that much easier to sell 36:07 the direct sponsorships which quite 36:09 frankly is where you're going to get the 36:10 most amount of money. 36:10 >> Totally. Yeah. 36:12 >> That's insane. What are those baseline 36:14 metrics? So people are selling this in 36:16 via media kit I said 40-plus open rate. 36:18 What are some of those kind of core 36:19 numbers that people out there should 36:21 know that like 36:22 this newsletter sucks it's above 36:24 average. What are those core numbers 36:25 they need to know? 36:26 >> So I guess like the downside of 36:27 newsletters is that there's just not 36:29 that much data to work with, right? So, 36:31 there's open rate, which is the 36:32 percentage of people that you that open 36:34 the email that you've sent, and that has 36:36 been obfuscated a bit because Apple has 36:38 privacy things, and there's other inbox 36:40 software. So, open rate is directionally 36:42 correct, but less accurate than it was 36:44 maybe 5 10 years ago. 36:46 There's click-through rate, 36:47 which is the percentage of people who 36:49 open the email and actually click on 36:50 links. So, is your content engaging? And 36:52 you can do click-through rate just for 36:54 advertisements as well. So, you know, 36:57 like a good to give you a benchmark, I'd 36:58 say anything like the 0.5% click-through 37:01 rate on an ad is pretty good given it's 37:03 an advertisement. 37:04 >> Under the notion that you probably have 37:05 multiple links to click. 37:06 >> Right. Yeah, but group them together, 37:08 right? So, you group all the ad links 37:09 together. 0.5% of people who are opening 37:12 that are actually clicking on the ad is 37:13 like pretty damn good. Anything over 1% 37:16 I consider like incredible, like best in 37:18 class. I think most ads are in like the 37:20 0.25 to 0.75 or 0.25 to 0.5 that I say 37:25 is like good. 37:25 >> Is there a direct correlation between 37:27 the number of ads and that click-through 37:28 rate? Like the more ads you have, the 37:29 lower the click-through rate? 37:30 >> Probably. 37:30 >> Yeah, I'd probably assume that. 37:32 >> But yeah, if you're a brand and you're 37:33 talking to newsletters, one like open 37:35 rate is like are the people that are 37:37 receiving this email even excited enough 37:38 to open it? And if open rates are below 37:40 30%, 37:42 I would consider that like a wishy-washy 37:45 audience. That's like they'll sometimes 37:46 open, but it's not like crazy high 37:47 engagement. For the Morning Brew story, 37:49 right, we're selling size, we're selling 37:51 who they are, but we also had a 45% open 37:54 rate while I was there. And so, what we 37:55 were also selling was these are people 37:57 who have built Morning Brew into their 38:00 daily habit and are super passionate and 38:03 reliably open this email. So, we do same 38:05 thing for us, right? I have like a My 38:07 last newsletter was 45%. And so, these 38:09 are founders who are interested in this 38:11 type of content, who want who are have a 38:13 high click-through rate. They're 38:14 clicking on ads. They they trust my 38:16 recommendations cuz I don't just 38:17 advertise any brand. And they're opening 38:19 40 45% of my emails. So, they're looking 38:21 forward to this and building it into 38:23 their habit every Tuesday. And like what 38:25 I just repeated is kind of like the 38:27 motions you have to go through as a 38:28 content creator or publisher to craft 38:30 your story of why would a brand give you 38:32 dollars to advertise when they could 38:34 also invest in Google and Meta and 38:36 Snapchat and TikTok. And so email subs 38:40 like convert crazy high. They're very 38:42 engaged audiences, but you have to be 38:43 able to tell that story. 38:45 >> Yeah, you have to know at the most 38:46 granular level your audience. I think 38:48 for people out there listening, a lot of 38:49 people out there are usually an operator 38:51 and they have their own company. I 38:52 highly recommend that if you are, you 38:54 should also become a creator cuz 38:55 obviously you'll own the audience and 38:56 that's going to scale and give you a lot 38:58 of leverage. Is knowing not only who 39:02 your reader is, but also who are the 39:05 companies that are going to pay you for 39:07 that reader. And you can look at 39:08 different industries and some of them 39:10 have a declining CAGR and like if you're 39:12 talking about AI in your newsletter 39:13 right now, and let's just say you have a 39:14 unique POV, 39:16 guys, they're paying a lot of money. 39:18 >> Well, that's what I'm saying. 39:18 >> a lot of money. 39:19 >> try to figure out what type of content 39:21 should I create? 39:22 I think it's important to understand why 39:24 like what type of newsletter you're 39:25 going for. Are you doing it for your 39:27 personal brand just to grow an audience 39:28 and so people recognize you and read 39:30 that content. But if you're like, I want 39:31 to monetize with ads and this one's and 39:33 I want this to be income in my life, 39:36 then you should back into how am I going 39:37 to monetize with ads and what type of 39:39 brands would even sponsor to get in 39:40 front of my audience. And AI is like the 39:42 perfect example. 39:43 >> And if you go hyper focus within AI, 39:45 let's just say obviously Claude is 39:46 leaning more on kind of the technical 39:48 verse I would say open AI is probably 39:50 winning more on image. Is like if you 39:52 just did just technical in the Claude 39:54 world and it was like 3,000, 4,000, 39:56 especially people that are trying to 39:57 compete with Claude, like those CPMs 40:00 would be through the [ __ ] roof. 40:01 >> Yeah, 100% and 40:03 >> And you guys have to think about that 40:04 before you start. Because that's also 40:07 going to inform you on like what is the 40:09 type of content that I'm going to put 40:10 out cuz is that X person going to be 40:12 interested? 40:13 >> Yeah, and their example is perfect cuz 40:14 you have all of these AI companies 40:16 raising hundreds of millions of dollars. 40:18 They raise hundreds of millions of 40:19 dollars to be able to get hundreds of 40:21 thousands of customers. Where do they 40:22 get those customers? And they they will 40:24 use Google, they'll use Meta, they'll 40:25 use out of home. But if you have a 40:27 newsletter of 50,000 people who are 40:29 super technical into AI 40:31 and they can sponsor your newsletter for 40:32 5, 10,000 dollars. Like that's a drop in 40:34 the bucket for them and it's a new 40:35 channel for them to get customers. So I 40:37 think that's like again, that's like the 40:38 business side of email and just content 40:41 creators in general that you have to 40:42 start thinking about if monetization and 40:45 advertisements are going to be a part of 40:46 how you grow your business. 40:48 >> I would say one more thing that makes 40:50 that very valuable that I just want to 40:51 layer in there for people out there 40:52 listening. Getting sponsors 40:54 that have high CACs, meaning it's cost 40:57 them a lot of money to get a customer, 40:58 you have to hit less home runs, less 41:00 people need to click through and win. 41:01 People that have high LTVs, 41:03 they can lose on the front and win on 41:05 the back. And then another big one is 41:07 price discrimination. Is let's just say 41:10 randomly I have someone here listening 41:11 that manages $700 million and I get that 41:14 one person for an X being, you know, B2B 41:16 company and that person's going to spend 41:18 a gazillion dollars. Like you want to be 41:20 able to get that asymmetric benefit. 41:21 Like if it's just a flat cost 41:23 throughout, you could get a huge fish 41:25 but they're going to pay the same amount 41:26 as someone that doesn't doesn't pay 41:27 much. So 41:28 >> Like HubSpot for example is a $50,000 41:32 CRM, right? I only need one person to 41:34 buy HubSpot and they are in the black 41:36 for five advertisements. And so I think 41:38 that's the way you have to think of like 41:40 that's very B2B centric but it's 41:42 relevant for anyone who's doing 41:43 advertising. 41:44 >> Okay, so sponsorships is one of the ways 41:46 that you monetize. I feel like that's 41:47 the most common and people people would 41:48 know that. What are other ways that you 41:50 can monetize your audience through a 41:52 newsletter? 41:52 >> So the other most popular I would say is 41:55 one that I actually don't use but paid 41:56 subscriptions, which is the Netflix 41:58 model, the Substack model if you want to 42:00 call it that. Basically, readers pay 10, 42:04 20, 30 dollars a month for whatever you 42:07 want to give with your subscription. The 42:09 most common model is you send, you know, 42:11 a free newsletter and you send two 42:13 paid-only newsletters. So, it's like 42:15 exclusive content. 42:16 But, there's other ways to bundle your 42:18 subscription. It can be a private 42:20 community, it can be a monthly webinar, 42:22 it could be IRL events. But, a 42:24 subscription is returning your free 42:27 readers into a recurring revenue and 42:29 building a subscription business around 42:30 that is the other common one. We are 42:34 very differentiated from every other 42:36 newsletter platform in the market where 42:37 we don't take a cut of revenue. So, it 42:39 kind of goes back to my thesis before of 42:41 we just genuinely want our users to 42:43 succeed. We don't think we deserve 42:46 revenue from hooking Stripe up and 42:48 playing middleman. Like, I think that 42:50 it's like a very predatory take rate 42:53 model that 42:54 puts creators and locks them into an 42:57 ecosystem and also leaves them 42:59 vulnerable to potentially pay more as 43:01 take rates potentially increase, which 43:04 Patreon went from a 4% take rate to a 43:06 12% take rate. Gumroad went from 4 to 43:09 10%. Etsy went from 3 and 1/2 to 6 and 43:12 1/2%. So, there's a history of platforms 43:14 that charge a take rate to return 43:16 capital to investors or to grow revenue. 43:18 If the only lever that they have to get 43:20 more revenue is to increase take rate, 43:23 then I would consider those content 43:25 creators to be in a pretty vulnerable 43:27 ecosystem to expose themselves to that. 43:29 >> Will you on the record with an evergreen 43:31 episode that will live on YouTube 43:32 forever 43:34 tell us that you'll never raise that 43:35 rate? 43:35 >> Yeah, so we have zero. It's So, there 43:37 there is no rate. 43:37 >> there forever. 43:38 >> Yeah, for sure. 100%. 43:40 >> Just look at me and I right there. 43:41 >> I know. 43:41 >> It's it's on the camera. Okay, so 43:44 let's just call them like kind of 43:44 digital products and paid subscriptions. 43:46 >> Two separate things actually. So, paid 43:48 subscriptions for sure, that's the 43:49 recurring revenue. Digital products is 43:51 something we launched in November, which 43:52 means you can sell templates, guides, 43:55 courses, time, like whatever you want. 43:57 Again, we don't take a cut of revenue 43:59 for that either. 44:00 And an example of that is 44:03 obviously, as you've heard me speak, we 44:04 I've scaled my newsletter to over 44:05 100,000 subscribers. 44:07 That's something that a lot of people 44:08 want access to knowing how I did that, 44:11 and you can either listen to this 44:12 podcast, which will be really helpful 44:13 for you, or I created a digital product 44:16 of zero to 100k full playbook. It is a 44:19 50-slide deck and then a 30-minute video 44:22 recording of me kind of going through 44:23 the deck and adding more color. Sell it 44:25 for $10. I've sold a thousand of them. 44:27 I've promoted three times. So, that's 44:29 >> Guys, we're going to give a little bit 44:30 of that sauce down below. You got to 44:31 give us a little bit of that sauce. 44:32 >> And that that took me, I think, 30 to 40 44:34 minutes. I I I had I had to build it for 44:36 a presentation. So, it's it's work that 44:37 I've already done. 44:38 I 44:39 flipped it into a digital product. That 44:41 took 10 minutes of time. And then I've 44:43 sold a thousand of them for $10,000. And 44:46 Beehiiv takes 0% of that. And so, that 44:48 is like what I consider a digital 44:50 product. And then the 44:51 two last ways I monetize, there's 44:53 another flavor of digital products 44:55 called like booking time, consulting, 44:58 coaching. It's kind of a blend. But for 45:00 an hour of my time, you can book time 45:02 with me directly, it's $1,000. And I've 45:04 done four of those calls. 45:06 And Beehiiv handles all of like the the 45:08 video conferencing, the scheduling, you 45:09 hook it up to your calendar. 45:11 And again, I'm a broken record, but we 45:13 take zero cut of revenue. So, any ways 45:15 that you're monetizing your audience on 45:16 the platform, we don't take a cut of 45:18 that. And we offer a very diverse range 45:21 of different ways from ads to 45:23 subscriptions to digital products. And 45:26 you can monetize however you'd like. 45:27 >> I know a couple companies that do that 45:29 the latter the one that you talked about 45:31 is, you know, people paying for the 45:32 time. Everyone takes a rip. That's a 45:35 good play. 45:36 You're basically trying all of these 45:37 kind of micro business activities. 45:39 You're just rolling them all up under 45:40 this umbrella 45:42 no take rate and just 45:44 land grab. 45:46 >> Yeah, I I in general, I I think it goes 45:48 to, unlike other companies in in this 45:51 competitive space, they have a different 45:53 business model. They are very 45:55 opinionated on how their creators make 45:57 money. If you only make money from paid 45:59 subscriptions by taking a 10% fee, then 46:02 your entire platform and business model 46:03 is how do we get more people to run paid 46:05 subscriptions, whether that's the right 46:07 business model or not for that 46:08 individual content creator. We have none 46:11 of those misaligned incentives. We know 46:13 that one creator looks very different 46:15 from the next creator. A paid 46:17 subscription product might be perfect 46:18 for one and terrible for another, and we 46:20 don't take a cut of revenue from any of 46:21 them, but we all we are still innovating 46:23 and supporting them and launching new 46:24 features every week towards these 46:26 different feature suites. And so the 46:28 thesis is as long as you have success on 46:30 our platform, that makes us more 46:32 successful. We have no take rate. We are 46:37 not opinionated in how you generate 46:38 revenue. We have full data portability, 46:40 so if you don't like using Beehiive, you 46:42 can export your list, you can export 46:44 your content, you can export your 46:45 subscriptions, and take it to whatever 46:47 platform you want. Data portability is 46:49 super important for content creators for 46:51 a lot of reasons. If you can't take your 46:53 audience and your content and your 46:54 subscriptions from one platform to 46:56 another, 46:57 then you're stuck with if they fall 46:58 behind in competition, you're stuck on 47:00 their old tech. 47:01 >> I dealt I've dealt with that before on 47:03 the I just I feel like Beehiive is 47:07 for all creators, especially operators 47:09 that are creators, but on the e-com side 47:11 we used probably some other companies 47:12 that you know of. And dude, they didn't 47:13 give us any of their when we left them, 47:15 they didn't give us anything. It was 47:17 like a battle back and forth. 47:18 >> Yeah. 47:19 >> It's [ __ ] insane. 47:19 >> And and you 47:20 >> They had humans. 47:21 >> Exactly. And so it's one of those things 47:23 that you don't realize until it's too 47:24 late when YouTube when you bet all on 47:26 YouTube and then YouTube shuts down your 47:27 account and you don't have any of that 47:28 data or any capability to get in front 47:31 of your audience again cuz you didn't 47:32 own that direct relationship. I think a 47:34 lot of people find out when it's way too 47:36 late. 47:37 >> There's somebody out there listening. I 47:38 had it, I don't know, probably like 47:40 nine or 10 years ago with I Kotic, our 47:43 first media buyer, he owned the ad 47:46 account in Meta. And when we let him go, 47:49 he left with the ad account. Yeah. Got 47:51 to make sure you guys own that. 47:53 >> 100% ownership is everything. So we're a 47:55 I'm a believer in that. 47:55 >> Let's double down more on this money. I 47:57 think the last thing which when we had 47:59 dinner I was really intrigued by this is 48:01 you have another like highly profitable 48:03 vertical which you briefly touched on 48:05 which is the IRL. What are you doing 48:06 with this Costa Rica mastermind and how 48:08 can somebody else duplicate what you've 48:10 done with that? 48:11 >> Yeah, this is the one I'm most proud of 48:13 because I think it involves thinking 48:14 outside the box. Everyone thinks of 48:16 monetization and ads, affiliates, 48:18 subscription, products and we support 48:20 all of that. But if you actually 48:22 understand who your audience is and I 48:23 think it starts from the top. I know the 48:25 type of content I'm creating and the 48:26 type of people it 48:27 it attracts. 48:28 And then I also have the survey form so 48:30 I know that 60% of my audience self 48:32 identifies as a founder. So what are 48:34 other creative ways that I can extract 48:36 revenue or provide value ideally both to 48:39 this audience? 48:40 And 48:41 founders love meeting other founders. I 48:43 sit in my room 16 hours a day in 48:45 isolation and just grind headphones in. 48:47 But there's so much to be learned from 48:49 other founders who are either further 48:51 ahead from me or have made different 48:53 mistakes that I haven't experienced yet 48:55 or have unlocked different parts of 48:56 their business that I just am unaware 48:58 of. And so I started hosting these 49:01 founder masterminds in Costa Rica. It's 49:03 like a high ticket event. I invite eight 49:05 founders. It's $10,000 per person. We 49:08 get a massive villa for five days. We go 49:10 surfing. We get a private boat. We have 49:12 a private chef the whole time. There's 49:14 all of these like sessions of like 49:17 strategy sessions of how do you hire? 49:18 How do you scale? What software vendors 49:20 do you use? The last one was very AI 49:22 centric. How do you use open claw? How 49:24 do you use claw? How do you get 49:26 employees to adopt AI to unlock more 49:28 efficiencies? 49:30 And it's just a five-day nerd session of 49:32 like geeking out but we're in Costa Rica 49:34 on the beach and it's a very high 49:37 premium event. 49:39 And I love it. Like I I now I have a 49:40 network of 40 founders that I've gone on 49:42 this trip with. It's like kind of like a 49:43 fraternal experience, right? It's cool 49:45 to be able to understand the problems, 49:47 the personalities, the people behind all 49:49 of these different businesses and learn 49:50 from them. And it's super profitable. 49:52 >> And this is 100% on the back of the 49:54 email list and obviously sprinkling in 49:55 social as well, too, right? 49:56 >> Yeah, so I I put in the newsletter, 49:58 "Hey, we're doing our next founder 50:00 mastermind." 50:01 I get 40 applications. I run through 50:03 them. I choose eight of the best people. 50:05 We go down to Costa Rica. We have an 50:06 amazing time. I walk away with a better 50:08 better and bigger network of founders 50:10 who are building really cool [ __ ] and 50:12 are like 50:14 alumni, I guess you'll call them. Like 50:15 our alumni roster's not like crazy uh 50:18 successful startups. And it's super 50:20 profitable for me. It's like pays the 50:22 bills. It's like a nice way. And it's 50:24 another like I think what's most 50:25 important to me is it's a proof of 50:26 concept that you can take this 50:29 online community through my newsletter 50:31 that I've created through creating 50:32 content, boost recommendations, 50:34 referrals, and Facebook ads, and can 50:37 convert that into real-life 50:39 relationships and revenue that is far 50:41 higher margin than anything else that 50:43 I'm doing. 50:45 >> Looking back on this, what's the biggest 50:47 mistake you made in doing this? Because 50:48 somebody out there might even have less 50:50 subs, maybe two to five engaged subs, 50:52 and they're going to do this. If someone 50:53 wants to do something like this, what 50:54 are some big learning lessons? 50:56 >> Data's super important. And so I think I 50:58 flexed like the importance of doing the 51:00 survey and actually understanding who 51:02 your audience is. 51:03 I You can go so much deeper than what I 51:05 have. I have a survey form of five 51:07 questions that are all self-reported. 51:09 Again, kind of hinting like some of the 51:10 stuff that we're playing with at Beehiiv 51:12 behind the scenes, but being able to 51:14 actually show you exactly who these 51:16 people are makes your life as a content 51:18 creator so much easier cuz you know 51:20 what content to create, what 51:22 advertisements you can sell, what IRL 51:24 experiences you can sell. So I think 51:26 data's super important. 51:27 >> Yeah, data's definitely the weapon in 51:29 real life. I use WhisperFlow for hours 51:32 every single day. I think way faster 51:35 than I type. I speak about 220 [music] 51:37 words a minute and type only 45. 51:40 WhisperFlow closes that gap. It's a 51:42 voice-to-text tool that works anywhere 51:44 on [music] your computer or phone. You 51:46 talk and clean formatted text shows up 51:49 wherever your cursor is. All right, let 51:51 me show you. I'm going to answer a real 51:52 email right now without typing. You can 51:54 see here Ty is asking for feedback on 51:56 our intro video for the next episode. 51:58 Watch how I respond. 52:00 If you could just make a few changes, 52:01 [music] 52:01 uh make the red a little bit brighter, 52:03 the typography a little bit smaller. Uh 52:06 for the music, if you can just give me 52:07 some other options. [music] And that 52:08 first photo, some more options as well. 52:11 Uh please give me three options for 52:12 each. And uh make sure you send it to me 52:14 by end of day Friday. Thanks. 52:17 So, as you can tell, the text is way 52:19 cleaner. [music] I kind of speak in half 52:20 sentences and sometimes mumble on. This 52:22 makes it very clean, [music] 52:24 formatted perfectly, and avoids all the 52:26 small mistakes. This is a product that I 52:28 cannot live without. I promise you that 52:31 you will love it. If you guys are want 52:33 to get 1 month free of WhisperFlow Pro, 52:35 click the link below and use code open 52:37 residency. 52:39 >> I think a big way that you get a lot of 52:40 these people is obviously it's magnetic 52:42 that, you know, what we talked about 52:43 earlier is you're just building in 52:45 public. 52:46 I want to just 52:47 touch a little bit more on that because 52:49 there's very few people, especially the 52:50 scale that you're at, that's like 52:52 putting out the like you're putting out 52:54 a lot of stuff on the internet. So, has 52:57 that ever like burned a deal, a hire, or 52:59 a relationship? I want to just kind of 53:00 go into like the plusses and minuses cuz 53:01 like 53:03 you've been doing it, you've been doing 53:04 it at a high level, and you've been 53:05 doing it for a while. So, I don't think 53:06 that there's, quite frankly, many people 53:08 better to answer this than you. What's 53:10 been the plusses and minuses of building 53:11 in public? 53:12 >> Yeah, more plusses than minuses, for 53:14 sure. I think it's worth calling out 53:16 that I'm a super competitive person. And 53:20 me, part of building in public, one it's 53:22 I guess this is less building in public, 53:23 but I sent a monthly investor update 53:25 every single month since we first 53:26 started the company to all of our 53:28 investors, friends, family, and every 53:30 investor who passed on us as well. Just 53:33 kind of like a little [ __ ] you for not 53:34 believing in us cuz like 53:35 >> Wow, I like that. 53:36 >> Cuz I actually later stage series A, 53:38 series B, a lot of investing is like 53:40 based on the fundamentals and the 53:41 numbers. Like you either hit these 53:43 numbers and you have a certain growth 53:44 rate or you don't. But, investing in a 53:47 seed round is a total bet on you. It's 53:49 We We 53:49 >> believe in you, baby. 53:50 >> When When I When I rate When I raised 53:52 our seed round, we had no product, no 53:55 customers, no revenue. It was me with a 53:57 slide deck with my story of this is what 54:00 we built at Morning Brew, my vision of 54:02 like this is how big I think this 54:03 company can be. And the only thing in 54:05 between you writing the check and not 54:07 writing the check is whether or not you 54:08 believe that I could be the person to do 54:10 that. And we had 40 people say no. And 54:12 so, that pisses me off and like I 54:14 definitely have a grudge of me pouring 54:17 my heart and soul into something and 54:19 selling this vision to have someone on 54:21 the other end of the Zoom call be like, 54:23 I don't believe you can be the person 54:24 that do it that can do it. 54:26 >> Yo, Liz bro. 54:27 They don't [ __ ] with University of 54:28 Maryland. For sure. 54:29 >> That's mid-market. That's mid-market, 54:31 baby. 54:31 >> I know. 54:32 >> I'm University of Delaware. It's the 54:33 same [ __ ] It's kind of like upper 54:34 mid-market. I think Maryland's like a a 54:35 little better. But, you're not like a 54:37 freakazoid from the Bay. So, maybe they 54:39 didn't think that you were the guy. 54:40 >> Yeah, so Yeah, so I don't know if So, 54:43 for 54:43 >> Working out pretty well so far, guys. 54:45 >> I I give that context because building 54:47 in public has that same type of 54:48 pressure. Like, when I go to send that 54:50 investor update, like I know for a fact 54:52 that I can't write that update and let 54:53 them know that we had a down month, 54:55 right? Like I I have and I know at the 54:57 end of every month I'm going to write 54:58 that update. So, 2 weeks into the month 55:00 we are hustling. If we're not hitting 55:01 numbers, I'm making sure cuz I have one 55:03 like our actual investors, but everyone 55:05 who passed on me and said that it 55:06 wouldn't be possible, like I have that 55:08 chip on my shoulder that I have to prove 55:09 to them that this company's going to 55:10 [ __ ] make it and it's going to crush. 55:12 And so, that drive is the same thing 55:14 that also drives the building public. If 55:16 I've already taken the stance that I'm 55:17 going to share our revenue, our our 55:20 customer growth, our feature launches, 55:23 like everything that I do around the 55:24 building in public thing, 55:25 like there's no faking that. Like, that 55:27 the the rent is due. And 55:30 part of building public sharing the 55:31 failures, too. And like we have made 55:33 tons of mistakes. I have full 55:35 newsletters dedicated to me spending an 55:38 entire 3 months on a certain feature 55:40 that just totally flopped. And like I 55:41 think there's a vulnerability and 55:43 transparency to building in public that 55:44 actually makes it more relatable, makes 55:46 my content, and quite frankly, me more 55:49 interesting to follow because if it's 55:50 always sunshines and rainbow, like no 55:53 one wants that. They want the actual 55:55 like what's happening behind the scenes. 55:56 And I think I've been able to in a 55:59 manner of using storytelling and 56:01 narrative be able to weave what it's 56:03 like to build a company with real 56:05 numbers with the caveat that I'm not 56:07 just sharing like look at us, look at 56:09 this revenue milestone. 56:11 I try to incorporate valuable things and 56:14 strategies that anyone can take with 56:16 them. So, I think that's the kicker, and 56:18 I haven't seen too many people that have 56:19 been able to do that. 56:21 >> You said something really interesting 56:22 there, and I completely agree. I mean, 56:24 quite frankly, it's like one of the 56:25 reasons why I do the podcast is just the 56:27 pressure. It's just 56:30 I have to live my life a certain way to 56:32 be prepared to be on this podcast both 56:35 physically and mentally. I think for all 56:37 the people out there listening is 56:38 finding something They always say like 56:40 pressure is a privilege. Just finding 56:41 something that it forces you 56:43 It's like, you know, if you have a goal, 56:44 you say it out there into the public, 56:46 and there's a way higher likelihood that 56:48 you're going to want to obviously live 56:49 up to it, and I think you're doing it 56:51 at the highest of high levels. 56:53 >> I'd say the the other benefits outside 56:54 of like just creating the content and 56:56 the reason why I do it is the benefits 56:58 have been, I'd say, 50% of our employees 57:01 have came inbound because they and made 57:04 a decision between us and other 57:05 companies paying them if not if not the 57:08 same amount of money or more, but they 57:09 were like, I've already got a sense of 57:11 who you are, the company you're 57:12 building, and like I feel like I'm 57:14 already a part of the company before 57:15 even signing. And so, I do think there's 57:17 a level of transparency there. And then 57:18 also on the user side, like Time is one 57:21 of our biggest customers on the 57:22 enterprise. They came in because their 57:24 CTO read my newsletter. Like, the CTO of 57:27 Time signed up to a newsletter called 57:28 Big Desk Energy, read it for 6 months, 57:30 got a full understanding of who I am and 57:32 the vision in what we're building, and 57:34 then decided to convince his team to 57:36 move all of their email over from 57:38 whatever company they were using before 57:39 to beehive solely because he had this 57:41 parasocial relationship of 57:44 respecting what we are doing and seeing 57:45 the big vision and how we could benefit 57:47 him. 57:47 >> So many second and third level effects 57:49 on the newsletter and obviously these 57:50 investor updates. It's insane. And it 57:52 just could be one thing, i.e. the time 57:54 CTO coming in, that makes it all 57:56 worthwhile. 57:57 >> The only thing I can think about like 57:58 where did it blow up in my face would be 58:01 a lot of things I I don't know what I 58:03 don't know. Like I I'm very transparent 58:05 about our road map and what we're 58:06 building. And so like our we're 58:08 operating in a very competitive 58:09 industry. 58:10 Have I tipped my hand to things that we 58:13 are building that maybe 58:15 and I know for a fact our competitors 58:16 have taken attention to and maybe 58:18 launched something very similar to 58:20 compete with us. Like that's definitely 58:22 happened a handful of times. 58:24 And then I think when I wear my emotions 58:26 on my sleeve, 58:28 there are and like I've I've ruffled 58:30 feathers of other competitors in the 58:32 space. 58:34 I think that is me being competitive and 58:36 being me and standing for what we stand 58:38 for and being unafraid to speak my mind. 58:41 There are definitely people who are on 58:43 their pedestal who see the correct way 58:45 of doing business of wear suit and tie, 58:48 don't talk about competitors, don't do 58:49 this. And me 58:51 being competitive and talking negatively 58:54 about some of our competitors definitely 58:56 rubs some people the wrong way and they 58:58 think they are above wanting to support 59:01 a business who would have a founder who 59:03 is outspoken about those types of 59:05 things. And so we've definitely lost 59:06 customers because of that. I don't think 59:08 it's like a massive loss of customers. 59:11 But I mean there are definitely a vocal 59:12 minority of people who actually care 59:14 what the CEO says of the software that 59:15 they're using and if it's not 59:17 appropriate or above the belt for them, 59:19 they just don't engage. 59:20 >> Yeah, I've woken up to Tyler versus 59:22 Substack. Some shots fired on Twitter. 59:25 >> Not not 59:25 >> And you either love it or you hate it. I 59:27 I mean personally 59:27 >> more yes than no you're going to get 59:28 from that. I think you're going to get 59:30 better outcomes than worse. And those 59:31 people you just don't [ __ ] with them 59:32 anyway. 59:32 >> Totally. What's the first step people 59:34 like this if they're going to share in 59:35 public? What do you think the biggest 59:37 and most important step it is? There's a 59:39 lot of operators out there listening 59:41 that they hear they've been hearing this 59:42 a long time about kind of founder like 59:43 content. What do you think is the most 59:44 important first step and/or first inner 59:47 dialogue conversation they need to have? 59:48 >> I think it's to start testing and shoot 59:51 your shot on X or LinkedIn, like 59:53 X is such a great channel because it's 59:55 small sound bites of like that's how I 59:57 got into it. What my voice is now and 1:00:01 how outspoken I am and how opinionated I 1:00:02 am, like that's not what I was 5 years 1:00:04 ago. The way that I got into building in 1:00:06 public was just my genuine excitement 1:00:09 for what we are doing and the 1:00:10 possibility that I as a 27-year-old 1:00:13 could launch a company doing something 1:00:15 with people I care about in a space that 1:00:17 I'm interested in and bring something to 1:00:19 life and maybe have a life-changing 1:00:21 outcome one day. And ideally along that 1:00:24 journey change the lives of millions of 1:00:26 people. And like that, just even saying 1:00:28 that out loud gets me excited. And so 1:00:30 that is who I am as a person and my 1:00:32 building in public was just sharing that 1:00:35 openly on X. So we launched a new 1:00:37 feature and it's not look at me this 1:00:38 feature, it is this is so [ __ ] cool 1:00:41 that if our users got to use this 1:00:42 feature, they can be more successful. 1:00:45 And so I think it's just finding your 1:00:46 voice by testing different things on I'd 1:00:47 recommend X or Threads. And then once 1:00:50 you kind of build that up, like 1:00:51 obviously I would plug a newsletter. We 1:00:53 actually see one of our biggest segments 1:00:55 of users are CEOs and founders because I 1:00:58 think they are opening their eyes to how 1:01:00 valuable it is to have a voice, to have 1:01:02 an audience and be able to reach your 1:01:04 potential customers. 1:01:05 And so I think you can eventually 1:01:06 graduate to a newsletter, but if a 1:01:08 newsletter seems like too much to like 1:01:10 bite off at once, I just start testing 1:01:12 things on LinkedIn and X. 1:01:14 >> Yeah, I don't do a good enough job of 1:01:15 like showing my personality and doing 1:01:17 behind the scenes. I had a long talk 1:01:18 with my buddy Aaron Paul about you know, 1:01:21 the stuff that we do every single week 1:01:22 is absolutely crazy and then we just 1:01:24 don't put it out there enough. I think a 1:01:25 lot of people out there would be very 1:01:26 surprised about how big of a cohort it 1:01:29 is that are interested in 1:01:31 whatever you're doing out there. There's 1:01:33 always going to be a group of people 1:01:34 that are interested in what you're 1:01:34 doing. 1:01:35 >> And and that's why I never run out of 1:01:36 content. I have a meeting with the 1:01:37 product team. Someone shares a graph of 1:01:39 like some We tested something. It led to 1:01:42 better results. We have data to prove 1:01:43 it. That's content right there. How many 1:01:45 other founders or product teams would 1:01:47 love to know that we 1:01:49 tweak something on our onboarding flow. 1:01:51 We did this. We made a stance. The data 1:01:54 showed that and you can do that for your 1:01:55 business. That could be an entire 1:01:57 newsletter. I could give the backstory 1:01:58 of why we tested that, what problems our 1:02:00 users were coming into, what we tested, 1:02:03 here's the different variants that we 1:02:04 explored, this is what we went with, 1:02:05 this is what the data said. And anyone 1:02:07 reading that newsletter now has tons of 1:02:09 ammo to go back to their growth and 1:02:10 product team to test something similar. 1:02:12 And so I think it's like developing that 1:02:14 muscle. Same thing with like tweeting in 1:02:16 general. You like 1:02:17 it was never natural to me to like have 1:02:20 a life experience, whether it's in a 1:02:21 meeting or in the car, and be like, I 1:02:23 should share this. But once you get that 1:02:25 muscle, you start to actually look for 1:02:27 opportunities of things that you can 1:02:28 create content around. 1:02:30 >> I'm terrible at that [ __ ] man. 1:02:31 >> Yeah, I think it's like 1:02:32 I was terrible forever. I'm still not 1:02:34 great at it. I still have so many 1:02:35 thoughts that are in my notepad 1:02:36 somewhere that I just never get out. But 1:02:38 once you start finding that muscle, you 1:02:40 can just start looking for new 1:02:41 opportunities to create content and 1:02:42 provide value. 1:02:44 >> Start a newsletter. 1:02:45 So much valuable information there on 1:02:47 how to grow and monetize a newsletter. I 1:02:48 appreciate that. Let's talk a little bit 1:02:50 more about 1:02:51 talking about your six-figure side 1:02:53 hustle. Let's talk about 1:02:55 the nine-figure Beehive. 1:02:57 A couple things. 1:02:59 All of your team, Julia especially, 1:03:00 talked about your insane speed to market 1:03:04 on shipping product. Let's talk about 1:03:06 some of those kind of new products. 1:03:08 Obviously, it's very relative to this. 1:03:09 We recently moved over there. Native 1:03:11 podcasting hosted on Beehive. Tell us a 1:03:13 little bit about that. 1:03:14 >> Yeah. 1:03:15 >> And and why you did it? 1:03:16 >> Yeah, so 1:03:18 I'm a big believer in consolidation. I 1:03:20 think I said this earlier where content 1:03:22 creators don't want to manage 15 1:03:24 different pieces of software. They don't 1:03:25 want to have 15 different logins. They 1:03:26 don't want to pay 15 different 1:03:27 subscriptions. And most software is 1:03:29 [ __ ] Like most of the platforms that 1:03:31 people are using on a day-to-day basis, 1:03:33 they're not actually raving like that 1:03:34 was an enjoyable experience. They upload 1:03:37 their podcast to like some janky UI. It 1:03:39 spits back a little bit of data. They 1:03:41 don't love it. They don't rave about it, 1:03:42 but it does the job. I think what we've 1:03:44 gotten really good at be from our 1:03:46 engineers and our product designers is 1:03:49 we can build amazing software that 1:03:50 people love. And I think that's rare for 1:03:52 most companies. And so if you have the 1:03:55 ability to build software that people 1:03:56 love 1:03:57 and you realize that most content 1:03:59 creators want more to want us to be the 1:04:02 platform that they're using to run their 1:04:04 business, like where are the different 1:04:05 opportunities where we can innovate 1:04:07 there? 1:04:07 And we saw that a lot of our users had a 1:04:10 podcast. Right? If you have if you're 1:04:11 creating content for a newsletter, you 1:04:13 are a content creator as I alluded to 1:04:15 earlier. Most content creators now that 1:04:17 are more sophisticated and successful 1:04:19 aren't one channel, they're 1:04:21 multi-channel, podcast, video, audio, 1:04:23 newsletter. 1:04:25 And so we found that there was this no 1:04:27 brand affinity for podcast hosts. 1:04:29 >> Zero. You asked me what I was on, I had 1:04:30 no idea. 1:04:31 >> No one knows. Neither No one knows cuz 1:04:32 someone else does it or they signed up 1:04:34 to the first thing when they typed in 1:04:35 podcast hosting and whatever Google link 1:04:37 came up first is what they chose. 1:04:39 And it's just a rinse, wash, repeat, 1:04:41 upload audio, send it out, check it once 1:04:43 a month for data, and then like put it 1:04:45 into your media kit. 1:04:46 But people were logging into Beehiiv 1:04:47 daily to send their newsletter, to check 1:04:49 their stats, to look at their lead 1:04:50 magnets, to look at their surveys. So we 1:04:52 already had this behavior, people coming 1:04:54 to our software, and people loving using 1:04:55 the software. And so the natural 1:04:57 extension was always like can we offer 1:04:59 podcast hosting as well? 1:05:01 And we launched it early I think it was 1:05:03 like the first week of the quarter. We 1:05:04 shattered through our goals for our Q2 1:05:07 adoption 1:05:08 because our thesis was just so correct 1:05:11 in 1:05:12 how amazing is it to bundle your 1:05:15 newsletter and your podcast in the same 1:05:16 platform? We are already offer paid 1:05:18 subscription, so you can now group like 1:05:20 hey, you have my free newsletter, but if 1:05:21 you pay $10 a month, not only do you get 1:05:23 my paid newsletter, you also get a paid 1:05:26 only episode for the podcast. So you can 1:05:28 do freemium podcast as well. We already 1:05:30 have the Beehive ad network, so that's 1:05:32 to monetize newsletters. We're a few 1:05:34 months away, but you can see a world 1:05:35 where we'd also monetize your podcast. 1:05:37 >> Wow. 1:05:38 >> So there's like a monetization angle. We 1:05:40 already have the recommendation network 1:05:42 and we're doing that for newsletters 1:05:44 where we can help one newsletter grow 1:05:45 throughout the Beehive network. Can we 1:05:47 also do that for a podcast where you can 1:05:49 bundle and group and promote other 1:05:51 podcasts within the ecosystem? And then 1:05:53 we're already amazing at data. We're 1:05:55 ingesting billions and billions of rows 1:05:56 of data every day on the email side. Can 1:05:58 we get more transparency and tightly 1:06:01 couple with YouTube and Apple and 1:06:02 Spotify to provide that data who's 1:06:05 actually listening to your audience in 1:06:06 your podcast? 1:06:08 And then I think you get into what I'm 1:06:10 most excited about is once we're hosting 1:06:12 your website and your newsletter and 1:06:14 your podcast and you're collecting your 1:06:16 own first party data with surveys, but 1:06:18 we're hydrating data, you can actually 1:06:20 find out who your 10,000 top fans are. 1:06:23 And then you can't really do that on 1:06:24 YouTube. 1:06:24 >> Give us the sauce now. We're going to 1:06:25 get into MCPs. That's a perfect bridge 1:06:27 right there, too. It's the best way to 1:06:28 get it. 1:06:29 >> Yeah. I mean, the MCP is definitely one 1:06:31 of the ways, but it like right now all 1:06:33 of that data lives in different 1:06:34 platforms. You have your YouTube data, 1:06:35 you have your newsletter data, you have 1:06:36 your website data over here, you have 1:06:37 your podcast data. And in saying data 1:06:40 five times in 10 seconds, like I think 1:06:41 that is like the world that we're moving 1:06:43 towards. 1:06:43 >> Is that ultimately the play on how this 1:06:45 company sells for a gazillion dollars? 1:06:47 Is I mean, you're not you're not taking 1:06:48 a take rate on anything. So ultimately 1:06:51 if 1:06:51 >> No, we're not selling data. So like to 1:06:52 to be very clear when I say data, and I 1:06:53 think data like the data business model 1:06:55 has a bad reputation because people 1:06:57 think that you aggregate data and then 1:06:58 sell it to data brokers. You own all of 1:07:00 your data on Beehive. Like we don't own 1:07:02 that, we don't sell it, we don't touch 1:07:03 it. 1:07:04 >> But ultimately that's informing you guys 1:07:05 to make smarter decisions on behalf of 1:07:07 the whole entire ecosystem. 1:07:07 >> I want Mark to know exactly who his top 1:07:09 thousand fans are. Where if he were to 1:07:11 launch a $10,000 trip in Bali next 1:07:13 month, that he knows the thousand people 1:07:15 that would 100% sign up to do that. And 1:07:17 the way that you do that is you see like 1:07:19 who is reading who who is reading all of 1:07:21 your newsletters and clicking on the 1:07:22 links. Who's listening to every podcast? 1:07:24 Who goes to your website five times a 1:07:26 day? Who watches every YouTube video 1:07:27 that you put out there? And right now 1:07:29 like there's not a way to do that. To 1:07:31 use the YouTube example, you might have 1:07:33 people that watch start to finish every 1:07:35 single episode and comment on every 1:07:36 single episode, but YouTube will never 1:07:38 tell you who those people are. That it's 1:07:40 it's an individual. YouTube gives you 1:07:42 aggregate level stats. 1:07:44 The power of what we're building of 1:07:45 understanding the full ecosystem is you 1:07:48 can actually click on Tyler at Beehiive 1:07:50 and see that I've opened every one of 1:07:51 your emails. I've clicked on all of 1:07:52 these links. Every time you promote your 1:07:54 podcast, I click on it and I listen to 1:07:56 it. 1:07:56 >> Individualized one-to-one. 1:07:57 >> Individual one-to-one. So then whether 1:07:59 it's the MCP, there's like the manual 1:08:01 way of doing it before which is like 1:08:02 through segmentation, or what we're 1:08:04 alluding to in like the MCP where you 1:08:05 can just ask Claude 1:08:07 Claude with our MCP can connect to your 1:08:09 Beehiive account and pull all of your 1:08:11 data across everything. And so you can 1:08:12 say who are the thousand most engaged 1:08:14 people that I have across podcast, 1:08:15 newsletter, website. And we have data on 1:08:18 all of that. That's your data that we 1:08:19 can now serve to you. 1:08:21 And then you can be like, okay, now let 1:08:22 me send an email just to these 5,000 1:08:24 people and upsell this Bali trip that 1:08:26 we're going to make, you know, half 1:08:28 million dollars on. 1:08:28 >> And you can segment it however you want. 1:08:30 It could be based on geography, people 1:08:31 that are close it could be anything. And 1:08:33 for people out there listening, this MCP 1:08:35 I don't know what it actually stands 1:08:37 for. Something with the protocol, but 1:08:38 it's like a connector like a Zapier. It 1:08:40 just basically allows you to connect 1:08:41 like external tools and and different 1:08:43 sources into one. Where basically when 1:08:45 you're talking in an LLM to Claude or 1:08:47 ChatGPT, you can ask it literally any 1:08:50 and all of these questions. I love it 1:08:52 because then you're obviously layered on 1:08:53 to the LLM that you could be like 1:08:56 How should I How should I monetize this 1:08:58 specific cohort of audience? 1:09:00 >> And I think 1:09:01 the way to about the MCP is like 1:09:02 historically for all of time since we've 1:09:05 been alive or been alive as a company is 1:09:08 like you access Beehiiv through the 1:09:10 platform. You log in, you put your 1:09:11 email, you put your password in, you 1:09:13 click around. If you want to know how 1:09:14 much you grew yesterday, you go to a 1:09:15 dashboard, you put in like the time 1:09:17 frame is yesterday, it loads and you're 1:09:18 like, "Oh, we grew by 500 subs." If you 1:09:20 want to know your best performing post, 1:09:22 you go to your post, you scroll around, 1:09:24 you're like, this one did really well, 1:09:25 maybe we can sort it based on 1:09:26 engagement. But it's a user clicking 1:09:29 through the app to figure out what they 1:09:31 want to do. 1:09:32 In the past, definitely past 5 months 1:09:34 since the most recent models came out in 1:09:36 December and January, more and more 1:09:38 people are doing their work through 1:09:40 Claude or Codex or name your AI client, 1:09:44 but they are going first to Claude, 1:09:46 they're connecting all of their tools to 1:09:48 Claude, and instead of going through our 1:09:50 dashboard and figuring out how much you 1:09:51 grew by yesterday, you can just simply 1:09:53 ask Claude from your phone, "Yo, how 1:09:56 much did I grow and how many subscribers 1:09:57 churned yesterday?" It has access to all 1:09:59 of your data and it can pull that in and 1:10:01 give you the answer directly in Claude. 1:10:03 >> And it and it could have other 1:10:04 connectors to other programs. 1:10:06 >> can connect it to Slack. You can be 1:10:07 like, "Hey, you can set up something 1:10:09 that's like we want be our advertisers 1:10:12 are B2B brands. Every night, I want you 1:10:14 to go through everyone who signed up and 1:10:16 pull based on their email if they work 1:10:18 at a B2B company, so at HubSpot or 1:10:21 whatever. And then I want you to ping 1:10:22 our Slack channel with our sales team 1:10:24 and tell them, "Here's the people who 1:10:26 just signed up to our newsletter in the 1:10:27 past 24 hours." And because it's the the 1:10:30 benefit of an MCP in working with like 1:10:31 something like Claude is 1:10:34 it can think on its own. So you'd be 1:10:35 like, "I don't just want the email 1:10:37 address. Can you go scrape LinkedIn or 1:10:39 whatever 1:10:40 >> Give me their contact 1:10:41 >> me who they are. Are they a director? 1:10:43 Are they an entry-level employee? Are 1:10:44 they a mid-level employee? Are they in 1:10:45 product? Are they in sales?" And then 1:10:47 you can filter down more and be like, "I 1:10:49 just want decision-makers that are more 1:10:51 senior who work on the product and 1:10:53 marketing team that work at a a company 1:10:55 and ping that into our sales Slack 1:10:57 channel every day. And you can set that 1:10:59 up to run every single day. And like how 1:11:00 much of an amazing benefit is that as a 1:11:02 newsletter operator who's has a 1:11:04 advertising business model to have your 1:11:07 sales team fully equipped with everyone 1:11:08 signing up in real time with a full 1:11:11 download of exactly who they are. And so 1:11:13 it's like one of like the infinite 1:11:15 examples of why an MCP is so powerful 1:11:19 and why we're leaning so heavily into 1:11:20 understanding. Again, we're very 1:11:22 unopinionated. Like we don't need you to 1:11:23 go to our app. We don't care that you're 1:11:25 using other software. We encourage the 1:11:27 fact that you can do so much more in 1:11:29 Claude, even if that means you're 1:11:30 spending less time in in our app, you're 1:11:33 still getting value from the Beehive 1:11:34 platform, from the infrastructure. 1:11:35 >> say. Like like the quote-unquote 1:11:38 dashboard is not I'm not going to say 1:11:40 it's losing value. Ultimately, it's 1:11:41 still the input and they're you 1:11:44 utilizing Beehive for any and all those 1:11:45 other things. So they're always going to 1:11:47 stay with Beehive. But you're just not 1:11:49 emotional to how you extract the 1:11:50 information via an agent Slack or direct 1:11:53 to Claude. 1:11:54 >> Yeah. And I think an example and and a 1:11:56 company that I take a ton of inspiration 1:11:57 from is Linear. So Linear is a project 1:12:00 management app. 1:12:00 >> Never heard of them. Linear? 1:12:01 >> Linear. So they they're like a Trello or 1:12:05 like a monday.com. So project management 1:12:07 app, mostly for product and engineering. 1:12:09 So every 1:12:10 >> Big ClickUp guy here, guys. Co-sign 1:12:11 ClickUp. Let's go. 1:12:12 >> So if you are going to launch a new 1:12:15 feature and an engineer creates 20 1:12:16 tickets, so like 20 like items that they 1:12:18 have to like build, you can track that 1:12:20 all in Linear. They have the most 1:12:21 beautiful interface. And so 1:12:24 where Linear has won in this ecosystem 1:12:26 for the past 5 years is their UI is 1:12:29 stunning. It's so sleek. They have 1:12:30 amazing shortcuts. It's it's beautiful 1:12:32 and like really easy to use. So I'm a 1:12:34 huge fan of them. 1:12:35 They have leaned so heavily into agentic 1:12:37 workflows and MCP where you actually 1:12:41 don't need to go into Linear anymore. We 1:12:43 have Linear integrated into Slack and 1:12:44 you can just tag @linear like add a 1:12:46 ticket for this. You can go to Claude 1:12:48 and be like what's the status of this 1:12:50 project and it pulls everything from 1:12:51 Linear and brings it to you in Claude. 1:12:53 And the reason why I think it's such an 1:12:54 amazing example is the reason why Linear 1:12:56 was winning was cuz their UI. And they 1:12:59 And And in a way, and what a lot of 1:13:02 incumbent companies do, is they see that 1:13:03 as a threat. If they move everyone out 1:13:05 of the UI into Cloud, then it's an 1:13:07 equalizer to for all these other 1:13:09 companies. 1:13:10 But what they've actually found out is 1:13:11 now that they've made it so easy to 1:13:13 access everything within Linear, it's 1:13:15 not just our product and engineering 1:13:16 team that uses it, our support team uses 1:13:18 it, our sales team uses it. Like they've 1:13:20 extended the number of seats that our 1:13:21 team use from 50 to maybe 85. 1:13:25 Because now a support a member of our 1:13:27 support team might get a ticket that 1:13:29 something seems broken. They can go to 1:13:31 Cloud and say, "Hey, I just got this 1:13:32 support ticket. Are there any issues in 1:13:35 the app that I should be aware of?" And 1:13:36 it can quickly pull from Linear, "Yeah, 1:13:38 there's a bug that's related to that. 1:13:40 Here's the status of it, and this is the 1:13:42 engineer that's building it. Looks like 1:13:43 it should be shipped tomorrow." And like 1:13:45 that was never possible before or it 1:13:47 required a new seat going into Linear, 1:13:49 finding that ticket, being able to have 1:13:51 enough context know that they're even 1:13:52 connected. And so like more or less like 1:13:54 wasn't possible before. 1:13:56 Um 1:13:57 but I take a lot of inspiration from 1:13:58 that because I think a lot of incumbents 1:13:59 view that as a threat. And a company 1:14:01 that was actually winning and 1:14:03 differentiated on UI and UX leaned into 1:14:06 something that got people away from 1:14:07 their UI and UX and are actually winning 1:14:09 10 times harder because they've doubled 1:14:11 the amount of seats that we're using and 1:14:12 how much we're using their platform. And 1:14:14 so I think that's an amazing parallel 1:14:15 like what inspires me at Beehiive is 1:14:18 we could maybe decrease the amount of 1:14:19 people on a daily basis logging into our 1:14:21 platform, but we can level up the people 1:14:23 who are reliant on Beehiive 5 10x by 1:14:26 using this MCP and empowering their team 1:14:29 and more people on their team to be able 1:14:30 to plug in via Cloud. 1:14:32 >> Yeah, it's so crazy. I think that you 1:14:34 just like drew a hard line in the sand 1:14:35 between shitty leaders and good leaders, 1:14:37 especially in this inflection point with 1:14:38 AI. Like 1:14:40 for Iconic for 10 years we had one moat. 1:14:43 And then that is no longer the moat. You 1:14:45 know, like an example like design was 1:14:47 the moat. And now, obviously, with like 1:14:50 AI gen, it's way easier to do it. So, 1:14:52 now, one of our moats, one of our new 1:14:54 moats, is pricing power. We're the only 1:14:56 person in the space for the last 10 1:14:58 years that has produced X thousand 1:15:00 number of units. So, we have the ability 1:15:02 to get lower COGS. Thus, if any new 1:15:04 people come in, they're never going to 1:15:06 get the unit economics that we're going 1:15:07 to get cuz we have the leverage of the 1:15:08 volume. So, for people out there 1:15:10 listening, I'd say that's like a great 1:15:11 exercise to just like 1:15:14 Spence very non-emotional. Just from the 1:15:16 from the moment I met you, it's just 1:15:18 like be non-emotional and just take a 1:15:19 step back and you know, it's the old 1:15:21 adage like you go to the top of the 1:15:23 mountain like it's it's Naval 101. He 1:15:25 talks about how hard it is to go back to 1:15:27 the [ __ ] bottom. [ __ ] we've done 1:15:29 that with this podcast. Like literally 1:15:31 going back and starting at zero, it 1:15:32 [ __ ] sucks and it's hard. Um but the 1:15:36 real gangsters 1:15:37 >> Totally. 1:15:37 >> can do it. 1:15:38 >> Any Any last kind of things to touch on 1:15:40 on the MCPs? Things that I thought was 1:15:42 very unique with it is 1:15:44 >> It got so and again, 1:15:47 I I'm not the one directly playing with 1:15:49 it as much as the team is, but like 1:15:51 getting down to like subject line 1:15:52 trends. What gets the most open rate? 1:15:54 >> one of my favorite examples, actually. 1:15:55 >> It's It's amazing, bro. 1:15:57 >> Two things that I I I think would be 1:15:59 helpful for the audience is like I think 1:16:00 where people get stuck on the MCPs is 1:16:01 it's so powerful and can do so many 1:16:03 things that the what people need is like 1:16:06 a push in the right direction of like 1:16:07 where where should I even point this 1:16:08 thing? And so, a few different examples 1:16:10 that I've worked on, 1:16:12 the lowest hanging fruit's the easiest 1:16:13 one. It's here's my draft for my 1:16:14 newsletter, just like edit it, make sure 1:16:16 it's good. But, train it on all of your 1:16:18 content so it keeps that like the same 1:16:20 tone and voice. That's like 101, like 1:16:22 super easy. I would imagine most people 1:16:23 have done that. Um the subject line 1:16:25 one's really interesting. I was like 1:16:26 look at every post I've ever sent, look 1:16:28 at the subject lines, figure out what 1:16:30 works and what doesn't. And I actually 1:16:32 didn't really expect much, but what it 1:16:33 came back with blew It had its own 1:16:34 framework. It was like anytime you use 1:16:37 the word beehive in the subject line, it 1:16:38 goes 5% less open rate. If you have more 1:16:41 than three words in the subject line, 1:16:42 it's like two to three percent less. If 1:16:44 you do something abstract like a city or 1:16:46 location, it's like plus four percent 1:16:48 open rate. And so it built like based on 1:16:50 these like 200 posts that I've sent. It 1:16:52 created this entire framework where now 1:16:53 I send it the final draft and it just 1:16:55 spits out four subject lines for me to 1:16:57 test. 1:16:58 Based on like data, not just like based 1:16:59 on like whatever. And then another thing 1:17:01 I did recently, which was like really 1:17:03 interesting, was 1:17:05 I run an ad in every newsletter. Ads are 1:17:07 by far the most promotional part of the 1:17:09 email. So it's like use free code, sign 1:17:11 up for free. And with like email spam 1:17:14 filters with like enough words or enough 1:17:16 promotion, you either get bulked into 1:17:17 the spam folder, which is the worst, or 1:17:19 the promotion folder, which is not as 1:17:21 bad, but still not great. 1:17:22 And so I actually had it run analysis. I 1:17:24 was like, look at every newsletter and 1:17:25 the 1:17:26 and focus on the ad. And tell me how the 1:17:29 language I use in the ad influences the 1:17:32 open rate of my newsletter. And it found 1:17:35 like 15 key phrases from try this for 1:17:37 free, free trial, sign up, or use code 1:17:41 XX, whatever. 1:17:42 Anytime that I do more than one of 1:17:44 those, the open rate drops like four to 1:17:46 five percent. And so it's now created 1:17:48 its own markdown file and skill where 1:17:50 it's like feed me the ad and I will 1:17:52 revise it to make sure that it is 1:17:54 optimized for open rates based on all of 1:17:56 the data that we've seen. And you 1:17:57 combine that with my voice and tone and 1:17:59 now I have an ad that is 1:18:01 in my voice, optimized for email 1:18:03 optimized for opens that won't be 1:18:04 penalized. And like I've I've run it for 1:18:07 one week and I had my best open rate of 1:18:08 the year last week, so like I'm 1:18:11 Yeah. 1:18:12 >> Yeah, this MCP stuff is absolutely 1:18:14 crazy. Most creators are just duct 1:18:16 taping together a bunch of different 1:18:17 tools to run their podcast and their 1:18:18 newsletter. Your audience, the 1:18:20 analytics, the attention, it's all 1:18:21 split. Everything is fragmented. This is 1:18:23 where Beehive changed everything for us. 1:18:25 It's where Open Residency runs our 1:18:27 newsletter and they just dropped a new 1:18:29 native podcast tool. Upload your audio 1:18:31 and immediately get distributed to Apple 1:18:33 Podcasts and Spotify. If you're hosting 1:18:35 somewhere else, just paste your RSS feed 1:18:38 >> [music] 1:18:38 >> and your entire back catalog, the 1:18:40 metadata and the episodes all carry 1:18:41 over. One platform, one login, 1:18:44 everything talks to each other. [music] 1:18:45 Head to beehive.com/openresidency 1:18:48 for 30% off your first 3 months. [music] 1:18:50 Just enter code mark30 at checkout. 1:18:53 That's b e e h i i v dot com slash 1:18:56 openresidency and code mark30 at 1:18:58 checkout. Stop renting your audience, 1:19:00 start owning it. 1:19:02 >> Um, I want to get just a little bit into 1:19:05 marketing. How do you guys market? 1:19:07 >> It's a great question. We've already 1:19:08 done the founder led marketing stuff. A 1:19:11 lot of our sign-ups actually do come 1:19:12 from Twitter. Like the first year that 1:19:13 we started the business, we didn't spend 1:19:15 a dollar on acquisition. So, it was all 1:19:17 product led growth, founder led growth, 1:19:19 and organic. 1:19:21 We're we're investing a lot more in 1:19:22 brand now. We're seeing a lot of traffic 1:19:24 come in direct, which means that people 1:19:26 are hearing about us from 1:19:29 our content creators or from 1:19:31 >> From this podcast. Yeah. 1:19:33 >> Yeah, so brand brand something like 1:19:35 I almost feel like you have to earn the 1:19:36 privilege to invest in brand. I think 1:19:39 like as a small scrappy startup that 1:19:40 raises $2 million, every dollar out has 1:19:43 to return money. And so, you're very 1:19:45 focused on performance marketing, which 1:19:47 is we're going to put a thousand dollars 1:19:49 a day into meta and hopefully we get out 1:19:52 500 that will eventually grow with LTV 1:19:54 and to be like ROI positive. 1:19:57 You get to a point where and for us 1:19:59 we've seen like performance marketing 1:20:00 work less effectively over time, which I 1:20:03 think is like the natural evolution that 1:20:05 you eventually get and like shifting 1:20:06 more into brand. So, we do a lot of 1:20:08 creator partnerships. I think that's 1:20:10 actually There's a tailwind with what 1:20:12 we're doing in the creator economy and 1:20:14 building and like the business models 1:20:16 that are supporting our users being 1:20:18 successful. And what I mean by that is 1:20:20 it used to be influencer marketing when 1:20:22 you find a content creator, an 1:20:24 influencer, and for one post you give 1:20:26 them $5,000. And like that [ __ ] doesn't 1:20:29 work. 1:20:30 >> What what actually works and you do 1:20:33 this, others do this, where you actually 1:20:35 are like I'm only taking a certain 1:20:36 amount of brands, or flip it the other 1:20:39 way from the brands perspective, the 1:20:40 only way that you're actually going to 1:20:41 win trust with that creator's audience 1:20:44 is if there's repeated exposure across 1:20:46 different mediums. So, you're on their 1:20:47 social, you're on their podcast, you're 1:20:49 on their newsletter, and not just once, 1:20:51 but many times. David Senra with 1:20:53 Founders is like a great example. Like, 1:20:55 you can't listen or watch an episode of 1:20:58 Founders without knowing what Ramp is, 1:21:00 cuz Ramp has backed up the dump truck 1:21:02 and given him money to sponsor that for 1:21:04 years. But, Ramp knows that their target 1:21:07 customer listens to that podcast. 1:21:09 >> And it's CAC, LTV, and price 1:21:10 discrimination. 1:21:11 >> And so, the amount of pricing power that 1:21:14 they are willing to allocate to just own 1:21:16 that ad space on the Founders podcast is 1:21:19 extremely high. 1:21:21 As like as a consumer, I I associate 1:21:24 Ramp with Founders. I'm I'm probably 1:21:26 making him pay a lot more by saying this 1:21:27 right now. But, like, it worked a 1:21:29 thousand percent. And from the content 1:21:31 creator's perspective, they're not on 1:21:32 this flywheel of constantly finding the 1:21:34 next advertiser every week. He's like, I 1:21:37 can focus on creating content, cuz I 1:21:38 know Ramp just bought out my inventory 1:21:39 for the rest of the year. 1:21:40 >> Yeah. 1:21:41 >> And so, I think it's a win-win-win, and 1:21:42 I think more brands are coming around to 1:21:44 it. So, that's something we've been 1:21:45 doing a lot. So, I So, creator 1:21:46 partnerships is something we've done. We 1:21:48 were deep into SEO. We've been creating 1:21:50 content like for our blog two articles 1:21:53 every day for the past 4 years. So, we 1:21:54 built up this like content engine for 1:21:56 SEO. 1:21:57 >> Best practices on the platform? 1:21:59 >> Ev- everything. Anything for like that 1:22:00 that's like the low-hanging fruit. We'll 1:22:01 do case studies, we'll highlight things. 1:22:03 It could be anything that there's a lot 1:22:05 of search traffic for. So, what does an 1:22:07 open rate mean? How do I increase my 1:22:09 open rates? What's a good click-through 1:22:11 rate? Anything that our target user 1:22:13 would be Googling for or asking now 1:22:15 asking ChatGPT or Claude for. Like, we 1:22:18 have content to answer that question. 1:22:20 SEO, obviously, has been big for 1:22:22 decades. Like, that's something we 1:22:23 invested a lot in. And a lot of It's a 1:22:24 long-term play, right? Like, people try 1:22:27 SEO, and they give up on SEO cuz there's 1:22:29 they pay $10,000, $20,000 a month for 1:22:31 content being created. And then they 1:22:33 don't see results till years later, and 1:22:36 so you have to be you have to like stick 1:22:37 with it. But we invest we built our own 1:22:39 content engine, like our own content 1:22:41 engine, human generated. We have writers 1:22:43 around the world that are creating 1:22:44 content for us. 1:22:45 So then as AEO and GEO kind of take off, 1:22:48 we're obviously doing the same playbook, 1:22:50 but using more modern tools to 1:22:52 understand what's ranking in ChatGPT and 1:22:54 Claude, and how do we create our 1:22:55 content, change our website, and 1:22:57 reposition things to show up organically 1:23:00 in ChatGPT. So, that's like one bucket. 1:23:03 We have the product-led growth. So, at 1:23:05 the bottom, it's like the the classic 1:23:06 Hotmail example of 1:23:08 when you signed up for Hotmail in like 1:23:10 the '90s or whatever, it said like this 1:23:11 was sent with Hotmail. Kind of butchered 1:23:13 it, but like at the bottom of every 1:23:14 email it was like oh it was like free 1:23:16 email at Hotmail. And so we do that at 1:23:18 the bottom of all of our newsletters, 1:23:19 this powered by Beehiiv. So, we get a 1:23:21 new user who comes over, they send to 1:23:23 100,000 people. Those 100,000 recipients 1:23:25 see that their newsletter looks better, 1:23:27 it's cooler, there's more design, it's 1:23:29 more aesthetically pleasing, they have a 1:23:30 referral program, and they scroll down 1:23:32 to the bottom and see that it says 1:23:33 powered by Beehiiv. So, we get a bunch 1:23:35 of growth through that. And then word of 1:23:37 mouth, like 1:23:37 >> That's a really subtle flywheel right 1:23:39 there with the powered by Beehiiv play. 1:23:41 And the earliest 1:23:42 >> days, so like you can now pay to remove 1:23:43 it as like most companies allow you not 1:23:45 some of our competitors that are very 1:23:47 opinionated and don't let you do that, 1:23:49 but you can pay to remove that and like 1:23:50 private label your newsletter. Again, 1:23:52 our thesis is we don't want to be the 1:23:54 brand, we don't say that you are 1:23:56 launching a Beehiiv, you're launching 1:23:58 your own business, your own newsletter, 1:23:59 your own website. We're tools and 1:24:01 infrastructure in the background. So, 1:24:02 you can pay to remove that. But in the 1:24:04 earliest days, we saw data of how many 1:24:06 people that flywheel was a crazy. Like 1:24:08 the the amount of new users who would 1:24:11 come, send their newsletter, and that 1:24:12 would drive hundreds of new sign-ups 1:24:14 just from the powered by Beehiiv, where 1:24:16 we actually wouldn't let people pay to 1:24:17 remove it. It was a huge friction point. 1:24:20 Cuz people are like, "Hey, I'm paying 1:24:20 you $500 a month. Like, why can't I 1:24:22 remove this? And the answer is I knew 1:24:24 the data and I knew that it was driving 1:24:26 more of our growth. And as as pissed off 1:24:28 as that one person was, I would rather 1:24:30 them churn because the other nine out of 1:24:32 10 people who aren't complaining were 1:24:33 driving so much growth for us. So we 1:24:35 were pretty opinionated on on not 1:24:37 removing that for a while, but then 1:24:39 threw up a little bit and allowed people 1:24:40 to remove it. 1:24:41 >> What about Meta? 1:24:42 >> We we spend a good bit on Meta. We 1:24:44 actually haven't like cracked the code 1:24:45 on Meta, which I think is both good and 1:24:48 bad. 1:24:49 Good because if we're able to grow a $30 1:24:52 million ARR business without cracking 1:24:54 the Meta code, like I think there's room 1:24:56 for improvement and a way to like really 1:24:58 dial that in. 1:24:59 Bad because Meta is one of the most 1:25:01 scalable channels and like we we have 1:25:03 not made it work to the extent that I 1:25:05 think we could. Think I've like a lot of 1:25:06 different theses around that. One is 1:25:08 like I think Meta, like when I'm 1:25:09 scrolling on Instagram, like it's very 1:25:11 passive. I'm not I'm usually not like in 1:25:13 I want to take over the world mode of oh 1:25:15 [ __ ] here's a newsletter platform where 1:25:17 I can launch my own business, launch my 1:25:18 own newsletter, launch a podcast. 1:25:19 >> Interesting. 1:25:20 >> And so we've shifted Meta to be more top 1:25:23 of funnel brand where it's 1:25:26 showcasing the success stories on the 1:25:28 platform, some of the capabilities, more 1:25:30 in like the consideration stage. I think 1:25:32 the 1:25:33 I was on my couch watching football, 1:25:35 scrolling Instagram and in between this 1:25:38 girl and this clothing brand, I there's 1:25:40 a newsletter company that started trying 1:25:42 to tell me to like now stand up, go to 1:25:44 my computer, launch this business, come 1:25:46 up with a logo, plug into the MCP. Like 1:25:49 we haven't seen that work super well, so 1:25:51 >> I think you need a little bit of time to 1:25:53 explain it to people. Like the YouTube 1:25:55 ads that I get from you guys are good 1:25:56 cuz they're like longer, they're 1:25:57 in-depth. 1:25:58 >> YouTube's better. I I I I think it's 1:26:00 like what what's the analogy where like 1:26:02 Twitter's more like lean in where you're 1:26:03 kind of like learning things, you're 1:26:05 scrolling, you're active, you're being 1:26:06 either enraged by this tweet or really 1:26:08 engaged by this tweet where Instagram 1:26:11 and TikTok are a little bit more like 1:26:12 laid-back, kind of like slouch, it's 1:26:14 more passive, it's more entertainment. 1:26:16 And I do think there's something around 1:26:17 the state of mind that people are in 1:26:19 each of those platforms why one works 1:26:20 better than the other. 1:26:22 Same with YouTube, right? YouTube could 1:26:23 be a little bit more laid back with 1:26:24 typically you're going out of your way. 1:26:26 When you get served an ad, you're going 1:26:27 out of your way, you type in something, 1:26:28 you want to learn something. And if you 1:26:30 get a 30-second demo of a product that 1:26:32 could hopefully help you launch a 1:26:33 business, we've seen a lot more success 1:26:35 on definitely Google and YouTube. 1:26:39 >> What about the state of newsletters? 1:26:40 People have been saying it's like the 1:26:42 top it's like the peak of newsletters I 1:26:43 feel like for like 1:26:45 >> Since I started raising capital. When it 1:26:46 when when those 40 investors passed on 1:26:48 me, a lot of it was, "Hey, like Morning 1:26:50 Brew just sold, Axios just sold, 1:26:52 Politico just sold, The Hustle just 1:26:54 sold. Like there's not that many of 1:26:55 them. We're at peak newsletter. Like 1:26:57 there there can't be that much room to 1:26:59 run." What they didn't see is like one 1:27:01 this is like a totally wrong thesis. 1:27:02 Like we're still very early in 1:27:04 newsletter. Like we we see no slowdown. 1:27:07 There There's a few ways to look at it 1:27:08 from where I sit as a founder. There is 1:27:11 inbound coming in and excitement in the 1:27:15 newsletter ecosystem has only continued 1:27:17 to accelerate from everything from our 1:27:19 sign-up numbers to the amount of press 1:27:22 coverage we're receiving to the amount 1:27:24 of big content creators from like Arnold 1:27:25 Schwarzenegger to Cody Sanchez to like 1:27:27 all these people who are investing 1:27:29 heavily in email. And I had dinner with 1:27:30 someone on Saturday night and they 1:27:32 they're a TV personality. They have a 1:27:34 massive podcast. They're like, "All of 1:27:35 our good business comes from the email. 1:27:38 Like when we want to drive results, 1:27:39 whether it's to an advertiser, to our 1:27:41 community, to merch, to an IRL event, 1:27:44 that doesn't happen on the podcast and 1:27:46 it doesn't happen on TV, it's all the 1:27:48 newsletter." And so I think people are 1:27:49 waking up to like how impactful and 1:27:53 useful reaching your audience is via 1:27:55 email. So I'm very bullish on that. The 1:27:58 other way to look at the market is 1:27:59 Mailchimp's doing a billion dollars in 1:28:01 revenue. There's dozens of incumbent 1:28:04 platforms that move a fraction of what 1:28:07 we move and are post-acquisition, zero 1:28:11 hustle, run by a totally different 1:28:13 ethos. 1:28:14 And there's 1:28:15 I'd say 10 billion plus of revenue 1:28:17 sitting in all of these companies that 1:28:19 do something tangential to what we do. 1:28:21 And so we don't even need the market to 1:28:22 grow in that sense, which it is growing, 1:28:25 but we can just out-innovate and beat 1:28:28 out the existing competitors, and 1:28:29 there's billions of revenue sitting in 1:28:31 those companies. 1:28:33 And then the last bucket I'd say is like 1:28:35 newsletters are not the end-all be-all 1:28:36 for us. We we acquired a website 1:28:38 builder, and we have a very powerful 1:28:40 website builder. We launched podcasts a 1:28:43 month ago. 1:28:44 We launched digital products in 1:28:45 November. We're launching something else 1:28:47 big in July. Like we are really good at 1:28:50 product innovation, and the 1:28:51 consolidation I think is going to 1:28:53 continue to accelerate how big of a 1:28:55 market we can go after. 1:28:57 But I don't know if like the tagline is 1:28:59 creator OS, like the operating system 1:29:01 for creators, but you can kind of see 1:29:03 as we talk more about data, and as we 1:29:05 talk more about the MCP, like Beehiiv 1:29:07 being this infrastructure layer that any 1:29:09 content creator, whether you're video 1:29:11 first, audio first, or newsletter first 1:29:13 need to plug into an operating system 1:29:16 that allows you to focus on what you 1:29:18 want to do, which is creating content, 1:29:20 and allow us to augment what you do, 1:29:21 which is growing and making money. 1:29:24 >> What are you launching in July? 1:29:25 >> So we're launching community. So you can 1:29:28 think of it as Discord or Slack or 1:29:30 Circle. 1:29:31 >> Nice. 1:29:31 >> But now that you reach an audience of 1:29:33 100,000 people that are all interested 1:29:35 in startups or tech or sports, like how 1:29:37 do you actually go deeper and build 1:29:39 those relationships? And historically a 1:29:41 content creator is like one to many. So 1:29:43 it's you are creating a podcast, and 1:29:46 thousands of people listen to it. Where 1:29:47 you get a lot of value is when those 1:29:49 thousands of people actually interact 1:29:50 with each other. And so can you get them 1:29:52 in a community that you can paywall, so 1:29:54 you can turn it into a new revenue 1:29:55 stream. And you have different channels, 1:29:57 you have live feeds, you have audio, you 1:30:00 have video, you have text, you have IRL 1:30:03 events, like you can plug a lot into to 1:30:05 community where that becomes your home 1:30:06 base. And unlike other competitors, like 1:30:09 we it's not a beehive community. It's 1:30:10 your It's like Mark's community. 1:30:12 So, you can get your thousand super fans 1:30:15 and they're together paying you $30 a 1:30:17 month. You can do quarterly payments, 1:30:18 you can do annual payments. 1:30:20 You can do an SF channel, an LA channel, 1:30:22 New York channel so they can meet in 1:30:23 person. You can go live and do like a 1:30:25 live stream weekly. And like there's 1:30:28 exclusive access that they get. But I 1:30:30 think community is like the next 1:30:31 evolution of like what it means to be a 1:30:32 creator and to be really own the 1:30:34 audience. 1:30:36 >> Zero take rate? 1:30:37 >> Zero take rate. 1:30:39 >> Nice. Excited for that. This episode is 1:30:41 brought to you by Momentous. Most 1:30:43 Americans today are walking around 1:30:45 deficient in omega-3, vitamin D, and 1:30:47 magnesium. Three of the most 1:30:48 foundational things in energy, recovery, 1:30:51 and sleep. And even if you're already 1:30:53 taking supplements, the industry is so 1:30:54 loosely regulated that you really don't 1:30:57 know what you're taking. I know the team 1:30:58 behind Momentous personally, and that's 1:31:00 why I trust it. Every product, [music] 1:31:02 every batch is third-party tested for 1:31:04 NSF certified for sport. So, what's on 1:31:06 the label is exactly what's in the 1:31:08 bottle. It's why over 200 pro sports 1:31:10 teams trust them, and why my whole stack 1:31:13 is theirs. Omega-3, vitamin D, 1:31:15 magnesium, and creatine every single 1:31:17 day. If you're putting real effort into 1:31:18 your health, you want to know that it's 1:31:20 actually working. Go to 1:31:21 livemomentous.com, use code 1:31:23 openresidency for up to 35% off your 1:31:25 first order. 1:31:28 This episode is sponsored by Poppy AI, a 1:31:31 visual AI workspace that almost acts as 1:31:33 a whiteboard where you can ingest in 1:31:36 YouTube videos, podcast episodes, voice 1:31:38 notes, PDFs. You ask it a question, and 1:31:41 then it gives you answers based on 1:31:42 everything that you added. It's made for 1:31:43 visual thinkers and for anybody that's 1:31:45 sick and tired of bouncing back and 1:31:47 forth from a bunch of different tabs. It 1:31:49 really just helps you organize your 1:31:50 ideas and thoughts and research. For 1:31:52 podcast prep, I load in a bunch of past 1:31:55 episodes, some ideas for interview 1:31:57 questions, past links, and then Poppy 1:32:00 comes back and helps me kind of shape 1:32:02 questions that actually sound like my 1:32:04 true voice. Go to 1:32:05 getpoppy.ai/openresidency, 1:32:08 use the code OR for 25 bucks off. If 1:32:11 you're a creator at any level, this will 1:32:13 change your workflow. 1:32:16 Let's get into this last block before we 1:32:17 get into quick strike. 1:32:19 The king of Colombia, 130 people, 100 1:32:23 percent remote, no offices. Make the 1:32:26 case for remote at scale cuz I 1:32:30 don't know anybody that has that many 1:32:31 employees that's doing fully scale that 1:32:32 I talk to on a regular basis besides 1:32:34 you. 1:32:34 >> I can work it I can say the opposite. We 1:32:37 were just in San Diego for offsite last 1:32:38 week and the energy of having 130 smart 1:32:41 people in one conference room where you 1:32:43 can find a bug and walk over to the 1:32:45 engineer, tap them on the shoulder and 1:32:46 show him that and then have a meeting 1:32:48 outside and work through all of these 1:32:50 problems and whiteboard. Like there's 1:32:52 obviously a ton of value in in person 1:32:54 and we that one week in person, we see 1:32:57 such incredible strides across the 1:32:59 business where like we unlock a ton of 1:33:01 things, energy is super palpable. Part 1:33:03 of that's cuz we only get together once 1:33:04 a year and so we like really have a lot 1:33:06 of fun and pack a lot in and it's 1:33:08 amazing. So I when I say that I am very 1:33:11 pro remote, I'm not making the case that 1:33:14 in person's not better. I think if I 1:33:15 could get all 130 of those people in an 1:33:17 amazing beautiful office up every day 1:33:19 with that same passion, we would get 1:33:21 further faster. 1:33:23 The argument for remote is one, talent. 1:33:27 Like when we open a new role for a 1:33:29 product designer, I don't care if that 1:33:30 person is in New York or in India and in 1:33:32 that case we've hired multiple product 1:33:34 designers from India. It's whoever's the 1:33:36 most talented person for the job, like 1:33:38 that's who we want on the team. 1:33:39 I joke that if I only hired people from 1:33:42 LA, we would have failed years ago. Like 1:33:44 LA just doesn't have the talent pool. 1:33:46 Like the the people that we want that 1:33:48 are best in class aren't located in LA 1:33:50 and I think it's archaic in like with 1:33:52 what we have with technology to move 1:33:54 people from New York or whatever to to 1:33:57 have to move to a different location 1:33:58 just for a job. Like we can do our jobs 1:34:00 totally remote. And so talent's like the 1:34:02 big bucket where we open a new role and 1:34:04 I don't care where they're located. We 1:34:06 find the best person for the job. And 1:34:08 that in itself I think is a 10x 1:34:10 multiplier of like how we're able to 1:34:11 build a successful company. It really 1:34:13 starts and ends with good people. So 1:34:15 that's the first bucket. 1:34:17 Second bucket, you can say cost. We 1:34:19 don't pay for an office. Like the 1:34:21 offsite is expensive that we do every 1:34:23 year, but like we're not spending on 1:34:24 office or on office managers or on 1:34:26 materials like any of that [ __ ] So 1:34:28 it's like a pure like P&L item. Office 1:34:31 space, which is usually one of the 1:34:32 biggest items on the P&L, is like just 1:34:34 something we don't have to focus on. 1:34:36 There's also just 1:34:37 one I personally projecting hate 1:34:39 commuting. Like even when I was in New 1:34:41 York, even just commuting 30 minutes 1:34:42 every day, like that's 30 minutes that 1:34:43 I'd rather be either at the gym or at my 1:34:45 desk doing things. So the fact that I'm 1:34:48 not spending 30 minutes both ways 1:34:50 commuting in a car, like quality of life 1:34:52 is so much better. 1:34:54 There's retention. We have plenty of 1:34:56 people that [ __ ] off and go to Europe 1:34:58 and they work from Europe for 3 months. 1:34:59 And as long as they can show up to the 1:35:01 meetings that they need to show up to 1:35:02 and they're doing the same amount of 1:35:03 work that they need to be doing to not 1:35:05 let anyone else down on the team. I 1:35:06 couldn't care less if they're in 1:35:08 Bangkok, which we have employees in 1:35:09 Bangkok, or in Europe in the European 1:35:12 summer, or back in New York where they 1:35:13 typically live. 1:35:15 And I think that flexibility is amazing 1:35:16 as a person where I mean I'm a 1:35:18 psychopath and I have to work 16 hours a 1:35:20 day. A lot of employees only have to 1:35:22 work 8 10 hours a day. And if they want 1:35:23 to be in Europe and enjoy their time and 1:35:25 still hustle, like as long as the bar is 1:35:27 not being lowered of the work that 1:35:29 they're producing, that level of 1:35:30 flexibility I think is a reason why we 1:35:33 can I can count on two hands how many 1:35:34 people have left the company in 5 years. 1:35:36 And so 1:35:38 we have like next to no attrition. I 1:35:40 think the remote culture is a big part 1:35:42 of that. 1:35:43 And so yeah, I'm a huge believer in 1:35:45 remote culture for that reason and 1:35:47 there's a lot of baggage that comes with 1:35:48 being in person as well. With like we 1:35:51 have no HR problems. We have we have no 1:35:53 fights. We have no arguments. We have no 1:35:54 office issues. Like there's just so much 1:35:56 [ __ ] that like as you grow into a 1:35:58 company that has actually 130 bodies in 1:36:01 a single location where there's friction 1:36:03 and things that you have to deal with 1:36:04 that we just totally don't deal with. 1:36:06 And when you add the talent density 1:36:08 thing and you add the cost savings on an 1:36:11 office and you add the lifestyle 1:36:13 benefits of being where you want and 1:36:14 working where you want when you want to. 1:36:17 Uh the upside I think is is far exceeds 1:36:19 the downside. 1:36:20 >> What about the operating rhythm? Cuz I 1:36:22 mean you have a bunch of people that 1:36:23 could be working in Europe or behind a 1:36:25 computer with their underwear on. How 1:36:26 are you making sure everything stays 1:36:27 organized? Like what are the key things 1:36:29 that you're doing from like a structure 1:36:31 and rhythm perspective? 1:36:32 >> Yeah, so a few things. And and I I'd 1:36:34 also preface all this with like it 1:36:35 requires a very high trust environment, 1:36:37 right? You can't If you think like, "I 1:36:39 don't know if I want to hire this guy 1:36:40 cuz he might just watch Netflix all 1:36:41 day." Then one you're hiring the wrong 1:36:43 person. And and so the way that we built 1:36:45 the company like that's that's always a 1:36:47 number one question I get is, "How do 1:36:48 you know they're doing shit?" And I can 1:36:50 like break down very easily how. We 1:36:52 started off as an like a full team of 1:36:54 like six engineers. There's like my two 1:36:55 co-founders and our CTO and our first 1:36:57 few hires were all engineers. You either 1:37:00 get [ __ ] done or you don't. We we have 1:37:01 to launch these five features in the 1:37:03 next 2 weeks. You're doing this one, 1:37:04 you're doing this one, you're doing this 1:37:05 one. If you're able to do your work 1:37:07 faster and or you're ahead of pace, like 1:37:09 good for you. Take the take the the 1:37:10 afternoon off if you can get it done by 1:37:12 4:00. But like what what matters to me 1:37:14 is outcomes. And if you can ship that 1:37:17 feature before you're supposed to, like 1:37:19 that's all that matters to me. And when 1:37:20 you have a team of engineers, there's 1:37:22 also like no room for [ __ ] So if 1:37:24 you say that this is going to take 10 1:37:26 days and an engineer goes, "I think that 1:37:27 takes 4 days." Like we will get to the 1:37:28 bottom of that. So I'd say as far as 1:37:30 like the pace and the operating cadence 1:37:32 of how we do things, like engineers have 1:37:34 to get [ __ ] done. 1:37:35 The sales team, like you either hit 1:37:37 quota or you don't. And like so 1:37:39 everything is outcome-oriented. If you 1:37:41 can hit quota and go to lunch and and 1:37:42 take a 4-hour lunch break, that's 1:37:44 totally fine. But you have an aggressive 1:37:45 quota that you have to hit. Customer 1:37:47 support, like you have your queue of 50 1:37:49 tickets you got to get through any day 1:37:51 and like you have to get you either get 1:37:52 them done or you don't. For product, 1:37:54 like we have to push product, we have to 1:37:56 do QA, you have to create a product 1:37:57 requirement document. I can go down the 1:37:59 line of every single role at the company 1:38:01 and they're all there are very specific 1:38:03 outcomes that have to be done. And it's 1:38:05 very obvious whether you're doing it or 1:38:06 you're not. And when you have a high 1:38:07 trust environment and you have a bunch 1:38:09 of A players, it's not acceptable to 1:38:11 have four fifths of the team hustling, 1:38:13 busting their ass and getting their [ __ ] 1:38:14 done and this one person who's not cuz 1:38:16 that one person that will become very 1:38:18 obvious very quickly and there's just no 1:38:19 room on this team for that type of 1:38:21 person. 1:38:22 And so, when you run the team like that, 1:38:25 I couldn't care less if they're working 1:38:26 from the beach. Like if they're getting 1:38:28 their stuff done at a high level and 1:38:29 they're responsive and they're 1:38:30 communicative, that's what's most 1:38:32 important. As far as how I run the 1:38:34 company, 1:38:35 every Sunday I send an email, which 1:38:37 takes me like 2 hours to write. It's 1:38:38 like therapeutic for me. It's a I get a 1:38:40 download of everything that's going on 1:38:42 and I inform the company. And that's the 1:38:45 other caveat as being remote, like 1:38:46 communication's everything. Like I over 1:38:49 communicate every initiative that we're 1:38:50 working on, where we are as a business, 1:38:52 how are we doing on our quarterly goals 1:38:53 and then you have to drill that into 1:38:55 everyone's head because we don't have 1:38:56 those like 1:38:57 points of friction in the office where 1:38:59 we're running into each other and 1:39:00 talking about it. So, every Sunday I 1:39:02 send a deep dive email of here's like 1:39:03 the 20 things that we're working on with 1:39:05 tagging the right people. This is what 1:39:07 they're owning, this is what they're 1:39:08 owning. At the end of that email, I send 1:39:10 a form which everyone submits. It's 1:39:12 their top priority for the week. So, I 1:39:14 collect all 130 people. They have to say 1:39:16 this is like the number one thing I'm 1:39:17 focusing. 1:39:18 Partially for me cuz I want to know what 1:39:20 everyone's up to. Partially for them, I 1:39:22 think intentionality is super important. 1:39:24 I want them to go in the week on Sunday 1:39:25 knowing exactly like if I get nothing 1:39:27 else done, this is the one thing that 1:39:28 I've already prioritized. So, I think 1:39:30 that's good just for like level setting. 1:39:33 On Monday, we have our all hands. I had 1:39:35 it right before I came here and we have 1:39:37 something called the weekly success list 1:39:39 and this is something I made up. It came 1:39:40 out of like it's such a whirlwind Monday 1:39:43 through Friday where I'm putting out 1:39:44 fires, I'm doing this, I'm launching 1:39:45 this. Like it's so chaotic. And I 1:39:47 remember every Friday afternoon, I would 1:39:49 end the week and I'd have no idea if it 1:39:50 was a good week. Like we had a great 1:39:52 revenue week, but this customer churn 1:39:54 and then this broke. And so there was no 1:39:55 way to measure like was that objectively 1:39:58 a good week? So I created something 1:40:00 called the weekly success list, which is 1:40:02 every team can contribute up to two 1:40:03 things that like if they get it done by 1:40:05 the end of the week, then it's 1:40:06 considered a successful week. So it's 1:40:08 basically weekly goals essentially. 1:40:10 And on our all hands on Monday for 40 1:40:13 minutes, we run through all of the 1:40:14 items, about 15 to 20 items. So every 1:40:17 person can speak to exactly what they're 1:40:19 owning. So I'm adding like a layer of 1:40:20 accountability where it's not just me 1:40:22 projecting this, it's the team leads or 1:40:24 whoever's owning that initiative saying, 1:40:26 "This is what I want to own this week." 1:40:29 And going back to like me sending the 1:40:31 investor update to investors, like that 1:40:32 time is going to come where they have to 1:40:34 explain to the company whether they hit 1:40:35 that goal or or not. So there's a lot of 1:40:37 accountability baked into everything we 1:40:39 do. And this guy 1:40:40 >> So it's on Friday, I imagine. People 1:40:42 >> Sunday Sunday email goes out. I include 1:40:43 the weekly success list, which is hey, 1:40:45 this is what our goals are this week. 1:40:47 Every employee submits their top 1:40:48 priority of the week. So that then we go 1:40:50 over that on Monday, the weekly success 1:40:51 list. 1:40:52 Friday we have our second all hands. So 1:40:54 we have two all hands. We have one on 1:40:55 Monday, one on Friday. 1:40:57 Friday to all hands, I pull up the week 1:40:59 I pull up the top priorities. So it's in 1:41:02 it's in a spreadsheet of 130 people. And 1:41:04 I was sort it by team and I randomly 1:41:06 choose one or two people per team to 1:41:08 say, "Did you get that done or not?" And 1:41:09 they they speak to it. So they're like, 1:41:11 "Hey, if I'm on the sales team, I wanted 1:41:13 five outbound deals." I call on them and 1:41:15 they say, "Oh, we only got four this 1:41:16 week." It's not like a penalty for not 1:41:18 getting it. I honestly think if it was a 1:41:19 culture where you got penalized for not 1:41:20 hitting your goals, then no one would 1:41:22 have ambitious enough goals. 1:41:24 But it's a level of accountability that 1:41:25 you're going to have to speak to the 1:41:26 company and tell every all 130 people 1:41:29 whether or not you hit your goal. 1:41:30 >> So 130 people are on this meeting? 1:41:32 >> Yeah, 130. All hands Monday and Friday. 1:41:34 >> Damn. 1:41:35 >> And so there is Sunday you decide what 1:41:37 you want to prioritize and Friday you're 1:41:39 going to get called on to speak to 1:41:40 whether or not you hit that. So, there's 1:41:42 that level of accountability. I pull up 1:41:44 the weekly success list after that and 1:41:46 we run through item by item. It's did we 1:41:48 hit it or did we not? And so, when you 1:41:49 run the business like that and every 1:41:51 role has its own things that they need 1:41:52 to do. Every person has their top 1:41:53 priority of the week. 1:41:55 Every team has their weekly success 1:41:57 item. 1:41:58 And then we have a culture of A players. 1:42:00 Like A players reject and and I get this 1:42:03 every now and then we'll make the wrong 1:42:04 hire. And you the team lets you know 1:42:06 right away. It's like, "Hey, we've 1:42:08 worked so hard to build this amazing 1:42:10 culture and like we hustle and this new 1:42:12 person you brought into this team is not 1:42:14 they don't have the same level of 1:42:15 hustle. They're just like not cutting 1:42:16 it." And the team rejects them pretty 1:42:18 easily and so like I think that's why 1:42:20 maintaining a talent bar that's very 1:42:22 high is like probably the most important 1:42:23 thing you could do as a leader. 1:42:25 >> What is that rubric for when you're 1:42:27 hiring? How does that go? How involved 1:42:28 are you in that and what are the big 1:42:29 things you look for? 1:42:30 >> Yeah, I would like to say that I'd love 1:42:33 to wear like a badge of honor that I did 1:42:35 the Elon talk to everyone but like it's 1:42:36 so chaotic. Like I give him a lot more 1:42:38 respect. I used to hear that and be 1:42:39 like, "Yeah, no [ __ ] Like that's how 1:42:40 you create like a and maintain a bar of 1:42:43 talent." Until you're putting out fires 1:42:45 and managing a million things and like 1:42:47 you're like, "You know what? That hire 1:42:48 like I trust the lead to do it." So, I 1:42:50 don't speak to every new hire. But one 1:42:53 thing I do over index which you can 1:42:54 probably get out of like how I speak 1:42:55 about how we run the company is 1:42:57 I bet on passion and drive over 1:43:00 experience 10 times out of 10. We It's 1:43:02 funny we I don't think we have a single 1:43:03 engineer in Silicon Valley. It's like a 1:43:05 whole 'nother thing. I think it's a huge 1:43:06 competitive advantage for us. We don't 1:43:08 need the most accredited Harvard 1:43:09 Business School, went to Silicon Valley, 1:43:11 worked at Google. I worked at Google. I 1:43:14 wouldn't hire someone that worked at 1:43:15 Google. Like I I think that there is 1:43:17 value into the scrappier drive. We also 1:43:20 hire a lot of people that are Beeline 1:43:22 users. If they love the product so much, 1:43:25 they are using it daily, they know what 1:43:27 works, what doesn't and they want to see 1:43:28 it get better and they apply for a job 1:43:30 to help make us better. We've hired some 1:43:32 of our best employees from our existing 1:43:35 user base, and so that's been a huge 1:43:36 secret weapon for us as well. 1:43:38 >> Love it. I want to go a little bit into 1:43:40 money raising and capital allocation 1:43:41 before we get into the final questions. 1:43:42 So, 12.5 million Series A in 6 days. 1:43:47 Walk me through how that actually 1:43:47 happened. 1:43:48 >> Yeah, so you can read my newsletter as 1:43:50 well, which is 1:43:51 another great story that you can't get 1:43:53 from ChatGPT. 1:43:54 It it's pretty interconnected with a lot 1:43:56 of things we've already talked about. We 1:43:57 I send my monthly investor update every 1:43:59 single month. 1:44:01 And another thing that I think a lot of 1:44:03 people over index on is like a lot of 1:44:04 founders think that they're being 1:44:05 productive by taking these coffee chats. 1:44:07 And when you start the benefit of 1:44:09 building in public, so I didn't even 1:44:10 answer that question as fully as I 1:44:12 should. Like I talked about the new 1:44:13 users and I talked about the employees. 1:44:15 Investors are probably the biggest 1:44:16 thing. Every time I say that we just hit 1:44:18 20 million ARR or hit this different 1:44:20 milestone or we sent 2 billion emails, I 1:44:22 get dozens of emails from every investor 1:44:24 being like, "Hey, we should chat. Hey, 1:44:25 we should have coffee." 1:44:27 And so when 1:44:29 the all of these investors want to meet 1:44:32 for coffee, my most valuable resource is 1:44:34 my time. Like I have a strong thesis 1:44:37 that I don't need to be best friends 1:44:38 with any of these investors. If our 1:44:39 business looks like up into the right, 1:44:41 they wouldn't give a [ __ ] if I met with 1:44:42 them or not. They just want to invest in 1:44:44 winners. And in order for me to build a 1:44:45 winner, we need to I need to spend my 1:44:48 time building the company, not sitting 1:44:50 in traffic, grabbing coffee, having a 1:44:51 surface level conversation to check the 1:44:53 box that I'm building investor 1:44:54 relationships. So, I think that's 1:44:56 [ __ ] I never invested in a single 1:44:58 investor relationship. 1:45:00 Instead, investors would come to me. 1:45:02 They'd be like, "Hey, super impressed 1:45:03 with what you're doing. Would love to 1:45:05 meet." I go, "I don't have time to meet. 1:45:07 I'm building the company. But I have an 1:45:08 investor update and I'll add you to 1:45:10 that." And so 1:45:12 I would just take their email, add it to 1:45:14 my investor update, and they're going to 1:45:15 get far more value out of reading our 1:45:17 investor updates month to month than 1:45:18 they would ever get in a 30-minute 1:45:20 coffee chat with me. 1:45:21 And so Faraz from Lightspeed came 1:45:23 inbound. He came in LinkedIn, texts, 1:45:26 acts, like I ignored all of them cuz I 1:45:28 typically ignore them. When we're not 1:45:29 raising, we're not raising and so like I 1:45:30 don't even pay any attention to 1:45:32 investors. Then finally he got my 1:45:33 attention with a dinner. He was like, 1:45:37 "Hey, we're doing like a founders dinner 1:45:38 in LA." And I at the time, you know, I 1:45:40 sit in my room for 16 hours a day. It's 1:45:42 fairly lonely and he caught me at a time 1:45:43 where I was like, "You know what? It'd 1:45:44 be nice to get out of the house for once 1:45:45 and like maybe just meet a few other 1:45:46 founders." He also sat me next to 1:45:48 Jessica Alba, which was amazing. He told 1:45:50 me the guest list. He's like, "She is 1:45:51 like the special guest." I was like, 1:45:52 "I'm only coming if you sit me next to 1:45:53 her." 1:45:54 >> Hey, yes, I guess that 1:45:55 >> That doesn't matter. 1:45:56 >> Yeah. So, that's how I built a 1:45:57 relationship with Faraz. And I added him 1:46:00 to our investor update. And I was like, 1:46:02 "We're not raising money. Don't really 1:46:03 want to talk to you. There's no reason 1:46:04 to like just build this relationship." 1:46:06 And fast forward, there came a time 1:46:08 where I was still answering support 1:46:10 tickets. I was up to 1:00 a.m. 7 nights 1:46:12 a week answering support tickets. I 1:46:14 would do my job, my like normal job, 1:46:15 which is like product design engineer, 1:46:18 whatever. And then at like 7:00 I'd open 1:46:20 up Zendesk and I'd answer support 1:46:22 tickets for 4 hours. And it got to the 1:46:24 point where I was like this isn't the 1:46:25 most sustainable way to build this 1:46:26 business. And I think we were at an 1:46:28 inflection point where we should have 1:46:29 raised capital. And as soon as I said, 1:46:31 "Okay, it's time to raise money." I had 1:46:34 a list of 300 investors who've been 1:46:35 reading all of our investor updates. I 1:46:37 knew Faraz as and Lightspeed has been 1:46:39 very interested in us. So, I text I I 1:46:41 sent him an email Saturday morning and I 1:46:43 was like, "Hey, I think we're going to 1:46:44 consider raising a series A." 1:46:46 He's like, "Okay, let's get you in 1:46:47 contact with like our VP and this." I 1:46:48 go, "We're going straight to the top. 1:46:50 Like you've been chasing us for for 1:46:52 months. If we're going to do this, you 1:46:54 are going to get me in the room with the 1:46:56 partners who actually make the 1:46:57 decisions. Like I'm not going through 1:46:58 all these rounds." And I did that with 1:47:00 like three other funds or firms. And 1:47:03 fast forward by that Friday. So, I sent 1:47:05 the email Saturday morning. By that 1:47:06 Friday, we had two term sheets. And then 1:47:09 I spent all Saturday and Sunday in 1:47:10 Mexico City walking around like taking 1:47:12 calls, trying to figure out cuz like I 1:47:13 feel like the seed round was like 1:47:15 >> The hard round. 1:47:16 >> Hard round, but also the like just to 1:47:19 get off the ground. 1:47:20 Once you get into like series A, like 1:47:22 then we had to form the board. Then 1:47:23 there was like an equity pool. Like 1:47:24 that's I felt like that's where the 1:47:25 business got real. Like 1:47:28 it now and now numbers are so conflated 1:47:29 with AI and like companies are raising 1:47:31 such crazy amounts of money. Like it 1:47:32 doesn't sound like much. But as someone 1:47:34 who's a year and a half into building 1:47:35 this company, thinking that a tier one 1:47:38 fund is about to invest 12 and a half 1:47:40 million dollars into our baby, it like 1:47:42 felt real to have like a board and 1:47:43 everything else. So I'm like on the 1:47:45 phone with our lawyer. I'm talking to 1:47:46 like my co-founders. Like trying to 1:47:47 figure out whether we want to do the 1:47:49 deal or not. But long-winded way of 1:47:51 saying, yeah, the email went out to say 1:47:52 I decided Saturday morning I wanted to 1:47:54 raise money. I had all of the warm 1:47:56 introductions from sending that investor 1:47:59 update every month. They already knew 1:48:01 the numbers. They trusted me. They saw 1:48:03 how I thought about the business. 1:48:04 They saw our growth rate for every month 1:48:06 that they've been on the investor 1:48:08 update. And so they didn't have to think 1:48:10 hard when I was like, "Hey, we're 1:48:10 raising money." They're like, "Yeah, 1:48:11 we're in." And so that's how we did that 1:48:13 in 6 days. 1:48:14 >> What's that open rate on the investor 1:48:15 update? Probably [ __ ] high. 1:48:16 >> 75, 80%. 1:48:17 >> Damn. 1:48:18 >> And I think the only 15, 20% that don't 1:48:20 open is cuz they've moved on to like a 1:48:22 different fund and we just haven't 1:48:23 cleaned them out. 1:48:24 >> Or they know that you're checking in 1:48:25 saying 1:48:26 >> [laughter] 1:48:27 >> Or or the the one of the ones who passed 1:48:28 and after like the first like 3 years of 1:48:30 rubbing it in their face that they 1:48:31 should have invested in us, they're 1:48:32 tired of getting that email. 1:48:34 >> You raised another 30 outside of saying 1:48:37 [ __ ] off to to coffee meetups and and 1:48:39 join the list. What are some of those 1:48:41 other big things that you've seen have 1:48:43 been successful for you in raising 1:48:44 money? 1:48:44 >> So the B was 1:48:47 harder because once you get into like B 1:48:49 and more growth stage, it really is like 1:48:52 for both the seed the seed's all 1:48:53 storytelling. It's here's my my 1:48:56 credentials. Here's my vision. Do you 1:48:58 believe I can do it? 1:49:00 The A is we have a lot of early 1:49:02 traction. We're growing a lot. The 1:49:04 market's growing a ton. 1:49:06 And if you invest at this point in time, 1:49:08 there's an amazing upside for you as an 1:49:10 investor in our series A. 1:49:11 >> On the multiple side. 1:49:12 >> Series B is when you get into like, 1:49:14 okay, like how do your numbers actually 1:49:15 look? Like when you put $10 in, how much 1:49:17 money are you getting out? What are your 1:49:19 growth rates? What are your expansion 1:49:20 opportunities? What is your LTV? And 1:49:23 like they really dig in to understanding 1:49:26 the business. 1:49:26 >> do they 4 or 5 x their money? 1:49:27 >> How do they How do you How do you 4 It's 1:49:29 easy to 4 or 5 It's not easy, but it's 1:49:30 easier to 4 or 5 x that at like a $10 1:49:32 million valuation than at a $225 million 1:49:34 valuation. Once you're in that, for them 1:49:36 to be happy with their investment, it 1:49:37 has to be a billion-dollar company. And 1:49:39 like how many billion-dollar companies 1:49:40 are there? More now, but it's still not 1:49:43 easy to build a unicorn. 1:49:45 And so the the scrutiny of like actually 1:49:47 knowing your numbers and trusting the 1:49:49 team, like we got a lot of scrutiny of 1:49:50 around 1:49:52 is that person on your team the right 1:49:54 person to lead this org? Like they're 1:49:55 good in the zero-to-one stage. They can 1:49:56 get you to 10 million in revenue, but 1:49:58 can they get you to 200 million in 1:50:00 revenue? And so there's a lot more 1:50:02 scrutiny of both numbers and people 1:50:05 to see if they can 5 x this into like a 1:50:07 billion-dollar 1:50:09 earn-out at one point. I say all of that 1:50:11 because like we we ultimately raised it 1:50:14 from NEA. They were involved with our 1:50:15 Series A. There was already like a 1:50:17 mutual interest before then. We didn't 1:50:18 choose them for our Series A. So we 1:50:20 already had like a strong alignment of 1:50:21 like they believed in us and wanted to 1:50:23 be involved. And then 1:50:25 but we 1:50:26 played the field. We wanted to see what 1:50:28 different valuations, what different 1:50:29 partners we can get. And like the 1:50:31 partners dug in like very deep across 1:50:32 the board. But we're very happy with NEA 1:50:35 and also because like it goes back to 1:50:37 like at that point NEA had read every 1:50:39 investor update I've sent for 20 months. 1:50:41 Like they knew the business inside and 1:50:43 out. And we met with them for our Series 1:50:45 A. So they got to really know the team. 1:50:47 And so in a way of my like [ __ ] you 1:50:49 attitude towards investors of like I'm 1:50:51 not going to take the coffee chats cuz 1:50:52 like nine out of 10 of them were going 1:50:53 to go nowhere and they're all 1:50:54 surface-level anyway. Like that was a 1:50:56 total cheat code for me just to add them 1:50:58 to my investor update. But it also just 1:51:00 nurtured these relationships in like a 1:51:02 weird way 1:51:03 I did less but more. 1:51:05 >> That's really interesting. That like 1:51:08 low-touch 1:51:10 check-in on the investor updates. I 1:51:12 mean, if someone sees up into the right 1:51:14 five times, 10 times, 15 times, the FOMO 1:51:17 is crazy there. Um we're going to get 1:51:19 into quick track. I'm going to ask you 1:51:21 a bunch of questions. One word to 1:51:23 describe Andrew Plotkin. 1:51:25 >> It's hard to describe him in one word. 1:51:27 In- incredible is probably the the 1:51:29 easiest one that comes to mind. 1:51:31 A machine is probably another. 1:51:33 Never seen an engineer with as much 1:51:34 passion 1:51:36 and was able to ship so much code, 1:51:38 unblock five other engineers, 1:51:40 and just do everything at such a high 1:51:43 level like him. So, I think everyone's 1:51:45 first reaction to working with Andrew 1:51:46 was just an absolute machine. 1:51:49 >> Young legend. 1:51:50 >> The best hire you've made and when did 1:51:52 you know it was the best hire? 1:51:55 >> Sorry guys, we're just calling out one 1:51:56 single individual here. 1:51:58 >> Yeah, no, it's hard. It's like picking 1:51:59 my favorite child. The the one I'll 1:52:01 that's top of mind is Dan, our COO. Like 1:52:05 he's just such an operator, amazing 1:52:07 experience. He worked at Meta, he helped 1:52:09 launch Instagram, he worked at DoorDash, 1:52:11 he helped launch Dash Pass. He comes 1:52:13 from the background of like helped 1:52:15 launch Puck airmail, he was at The 1:52:17 Information. Like he just knows email 1:52:19 like the top 1% but also knows big tech 1:52:22 like the top 1% from an operational 1:52:25 level and that's such a rare mix and 1:52:27 like a perfect piece of like what we 1:52:29 need. We want to be big tech or some 1:52:32 part bigger tech than what we are today, 1:52:34 but we obviously play in this media 1:52:35 ecosystem with subscriptions and 1:52:37 businesses and content and he just is a 1:52:40 one of one that knows both inside and 1:52:41 out. 1:52:42 >> How long until you know? 1:52:44 >> Instantly. 1:52:45 >> Hey. 1:52:47 >> What's a feature you killed in the last 1:52:48 24 months that you thought would be a 1:52:49 winner? 1:52:51 >> Killed as in like we as a good killed or 1:52:52 bad killed? 1:52:53 >> Bad killed. 1:52:54 >> Killed on the bad side? 1:52:57 It's a great question. I 1:52:59 kind of a cop out. The the sponsorship 1:53:01 the direct sponsorship network that we 1:53:02 talked about earlier, I think has the 1:53:03 potential to like totally change the 1:53:06 game for all of our content creators and 1:53:08 newsletters who want to sell direct 1:53:09 sponsors. We had such an ambitious road 1:53:11 map for it. It just took so much longer 1:53:13 to build. And so, what is available 1:53:15 today is like still our V1. It works. 1:53:18 There's tons of dollars being transacted 1:53:19 through it. There's a lot of publishers 1:53:21 who are selling tons of deals through 1:53:23 it. It's like a fraction of what we want 1:53:25 it to be. It just never had been 1:53:27 prioritized to get it to where we want 1:53:29 it to be. 1:53:29 >> What did you learn from working at 1:53:30 Google? 1:53:32 >> I'm sorry I [ __ ] on that experience a 1:53:33 lot just because like of how slow it 1:53:34 moves, but it actually did teach me a 1:53:36 lot. When I was at Morning Brew, I 1:53:39 didn't know what product was. I what I 1:53:42 figured out what product was cuz I 1:53:43 worked on growth and I worked on 1:53:45 engineering and backed into product. 1:53:47 But, I was the most raw product manager 1:53:49 ever. We never did a mock-up. We never 1:53:51 had a product requirement document. We 1:53:53 never had a timeline or a road map for 1:53:55 anything. I would just open my computer 1:53:56 and start building things. 1:53:57 When I went to Google, I saw how you 1:53:59 actually do product management at scale. 1:54:01 There's a product requirement document, 1:54:03 like 10 pages, outlines every user flow. 1:54:05 What's the timeline? What's the mock-up? 1:54:07 How does it work? What is What happens 1:54:08 when you click on this versus when you 1:54:09 click on this? 1:54:11 It's like I'd never known that what a 1:54:12 product requirement document was. Makes 1:54:13 it perfect sense to write out what 1:54:14 you're going to build before you spend 1:54:15 time building it. And then after that, 1:54:18 there's the technical requirement or the 1:54:20 tech spec essentially, which is now that 1:54:22 you have the PRD, hand it to the 1:54:23 engineers and let them outline exactly 1:54:25 how they're going to build it. So, 1:54:26 before writing a single line of code, 1:54:28 it's already been vetted and engineers 1:54:29 all agree this is the best way to build 1:54:31 it. 1:54:32 The PRD, the tech spec, like streamlines 1:54:34 everything. It's like a little bit of 1:54:36 like upfront work, saves you so much 1:54:38 trouble on the back end. Had no idea 1:54:40 either those existed before Google. And 1:54:41 in my 10 months, like learned to do 1:54:43 those really well. 1:54:46 >> The most underrated Beehiiv feature? 1:54:49 >> The most underrated Beehiiv feature? 1:54:53 Maybe 1:54:55 hm 1:54:56 magic links. 1:54:58 It's the one-click sign-up. And so, I 1:55:00 can create a magic link and give it to 1:55:02 you, and you can put my link in your 1:55:04 newsletter. And anyone who clicks on it 1:55:06 will automatically sign up to my 1:55:07 newsletter. They don't have to go to a 1:55:09 page, they don't have to go to a form, 1:55:10 they don't have to type in their email. 1:55:12 It's just like a thought around every 1:55:13 additional step adds more friction and 1:55:15 more drop-off. Because when you send 1:55:17 your email, you can like auto-populate 1:55:19 their email, it'll automatically add 1:55:21 them to mine. 1:55:22 So, you can partner with a bunch of you 1:55:23 can partner with different newsletters, 1:55:24 different publishers, different 1:55:25 whatever, give them your magic link, and 1:55:27 everyone who clicks on it automatically 1:55:29 joins your list. 1:55:31 >> Nate, that. Best newsletter you read 1:55:33 every week that isn't yours? 1:55:37 Probably Call Outsider Techery. Total 1:55:38 tech I'm a total tech nerd and just 1:55:41 going deep in like how these massive 1:55:43 businesses and tech companies are 1:55:45 innovating and building and hitting 1:55:46 their revenue numbers. Like, I think 1:55:48 he's the best in the business. 1:55:51 Most overhyped AI tool right now? 1:55:55 So many of them, right? 1:55:57 I think 1:55:58 >> One that people actually use. 1:56:00 >> I think what's interesting 1:56:02 is for the past 3 years, there's been 1:56:05 all of these like AI wrappers that say 1:56:07 they can help you write better, they can 1:56:08 help you create video, they can help you 1:56:10 do this that 1:56:13 weren't that powerful, but were marketed 1:56:15 with like the happy path beautiful demo 1:56:17 of what it can do. 1:56:19 I in the past 6 months haven't heard any 1:56:21 of their names. I've heard Claude. I I 1:56:23 see Claude workflows now. 1:56:25 >> Yeah, for people out there listening, 1:56:26 the wrappers are basically people 1:56:28 betting on brand distribution, how they 1:56:30 market, and they're just piggybacking 1:56:31 off the existing LLMs. I completely 1:56:33 agree with you. I know a lot of people 1:56:34 that spent a lot of time and money on 1:56:37 just literally a little small tweaks 1:56:40 with their language and thought process 1:56:43 on top of a Claude or an Open AI. 1:56:45 I don't think that's going to end well. 1:56:46 One word to describe Austin Reef. 1:56:50 >> Mhm. 1:56:51 Discipline's not the right word. It's 1:56:53 like 1:56:54 I don't know what but you can we'll 1:56:55 workshop this together. I think he's the 1:56:57 best operator that I've ever worked 1:56:59 with. He can see like a 10,000-ft view 1:57:02 of how a business is functioning and 1:57:04 break it down, figure out the right 1:57:06 pieces, who we need, what processes we 1:57:08 need to put into place, what's working, 1:57:09 what's not, like almost better than 1:57:11 anyone else I've come in contact with. 1:57:13 So, like operator's the word, but that's 1:57:15 not a great adjective. It's more of a 1:57:16 noun. 1:57:17 >> It's a nice compliment. We've just done 1:57:18 the Zoom. I'll probably meet him next 1:57:20 month. What's the best lead magnet 1:57:22 you've ever seen that wasn't yours? 1:57:24 >> Yeah, I 1:57:25 now I'm just recycling content. The Milk 1:57:27 Road one was amazing. They're the ones 1:57:28 who inspired mine, but it's again, you 1:57:30 sign up to Milk Road cuz you're 1:57:31 interested in crypto. If you're 1:57:33 interested in crypto, you probably want 1:57:34 to make money with crypto, and they just 1:57:36 had the lead magnet of one referral and 1:57:39 you'll receive a guide of what 15 crypto 1:57:41 experts think about crypto in 2022. If 1:57:44 you want to make money in crypto, you 1:57:45 got to know what the experts think. It's 1:57:46 like it sells itself and it crushed. 1:57:49 >> Uh shout out Uncle Ben. 1:57:51 Dude, I had an amazing time. Last four 1:57:52 questions that I ask everybody. Favorite 1:57:54 book or podcast and why? 1:57:56 >> Favorite book, so 1:58:00 I'll give two. One, I like love 1:58:01 psychology, so Thinking Fast and Slow is 1:58:04 amazing. And then my favorite business 1:58:06 book is No Rules Rules. It's about like 1:58:08 the Netflix culture. Obviously, I'm a 1:58:10 big culture guy for building a company 1:58:13 as you could tell when you're asking 1:58:14 about it like how I run the business. I 1:58:16 think Netflix culture is like second to 1:58:17 none and the book is is really 1:58:19 incredible. 1:58:21 >> Entrepreneur or brand that you want to 1:58:22 give flowers to and why? 1:58:25 >> I'm a huge fan of Brian Chesky and 1:58:27 Airbnb for a lot of reasons. I think 1:58:29 category creation like super inspiring 1:58:31 the Airbnb story. I think his background 1:58:34 in design and focus on design is really 1:58:36 interesting. I've also listened to a few 1:58:38 podcasts of him and 1:58:40 he thinks very similarly to me in terms 1:58:43 of how to build a business, being 1:58:45 authentic, how he values people. I think 1:58:48 during COVID when they laid off a ton of 1:58:49 people they they had to They so many 1:58:50 different divisions within Airbnb. The 1:58:52 way that they laid them off, the 1:58:54 severance, and then I think he also 1:58:55 created a page dedicated on their 1:58:57 website of everyone they laid off with 1:58:59 their profile and like a recommendation 1:59:02 for them. So, obviously firing people 1:59:05 and laying off people is the worst part 1:59:07 of the job, and do in a time of crisis 1:59:09 where you had to do it to be able to do 1:59:10 it with class and try to help them and 1:59:12 their families, I think there's like a 1:59:14 lot to respect about him. 1:59:16 >> Never heard that. I like that. What 1:59:17 about a creator you want to give flowers 1:59:19 to and why? They could have a good 1:59:20 newsletter or just a creator in general. 1:59:21 >> I think Colin and Samir have done such 1:59:23 an incredible job of building that 1:59:25 business because I think it exemplifies 1:59:27 what it means to be a modern successful 1:59:30 content creator. It is meeting your 1:59:32 audience where they are. When they 1:59:34 started with YouTube and then launched a 1:59:35 podcast and then launched a newsletter, 1:59:37 and now they're doing IRL events in New 1:59:39 York and LA. They do merch as well. It 1:59:42 is like the full encapsulation of what I 1:59:44 think our road map is providing, which 1:59:46 is again, unopinionated, however you 1:59:49 want to provide value to your users and 1:59:51 your audience, there should be a way to 1:59:52 be able to do that, especially on our 1:59:54 platform. 1:59:55 And 1:59:56 they're great. They create high-quality 1:59:57 content. They they push the limits and 2:00:00 they meet their audience where they are. 2:00:02 They aren't overly opinionated. They 2:00:03 start off as YouTubers and weren't 2:00:05 saying they weren't anti-podcast, they 2:00:07 weren't anti-newsletter. 2:00:09 They are able to adapt to like the 2:00:11 changing needs of like the ecosystem and 2:00:13 their audience. I think that is super 2:00:15 admirable. 2:00:16 >> The two ladies that are editors, they 2:00:17 work out of Lighthouse, we work out of 2:00:18 there. They do not use AI. They make it 2:00:20 very clear to me. It's a great 2:00:21 newsletter, Public Apology. 2:00:22 >> Yeah, it's amazing. 2:00:23 >> Public Apology, check it out. 2:00:24 Last question, man. How big can Beehiiv 2:00:27 be? 2:00:28 >> Uh I mean, I'm coming off our offsite 2:00:30 last week where we had some like really 2:00:32 big ambitious conversations. I think 2:00:34 we're so early. Um 2:00:37 I've hinted at some of the data things 2:00:38 that we're thinking about. 2:00:40 Depending on when this launches, you you 2:00:41 know what we're launching in July. 2:00:44 I know 2:00:45 my best trait as an entrepreneur is like 2:00:48 I'm a bit of a perfectionist and I know 2:00:50 everything in the platform that's a five 2:00:52 out of 10 or six out of 10. And there 2:00:54 are so much room to innovate and get 2:00:56 everything that we already offered to a 2:00:57 10 out of 10 and be such a 2:00:59 differentiated product. 2:01:01 But there's so much with AI and building 2:01:03 the infrastructure layer and the 2:01:04 operating system that we're like on the 2:01:05 cutting edge of and like so early in how 2:01:07 we can build this infrastructure. The ad 2:01:10 network I think is in the earliest days. 2:01:12 We're doing a million dollars a month 2:01:13 from the ad network. I've said from day 2:01:15 one that I think the ad network could be 2:01:16 the biggest revenue stream for us. 2:01:18 >> 100% agree. 2:01:18 >> Like we can get we I think we can what 2:01:21 My initial pitch in our first seed deck 2:01:24 where all those investors said no, was I 2:01:26 actually don't think our competition is 2:01:28 the current email providers. I think it 2:01:30 is Meta and Google cuz I want to take ad 2:01:33 dollars from them. I think if you want 2:01:35 to monetize if you want to find 2:01:36 customers in email, the only place to do 2:01:39 that will be Beehiiv. And I've been told 2:01:41 that's actually I thought that was a big 2:01:42 ambitious goal. 2:01:44 My goal was I want to create Facebook ad 2:01:46 manager for email. And I'd always like 2:01:48 mic drop. I was like that's such a big 2:01:49 goal. That's a multi-billion dollar 2:01:51 business. And then someone told me that 2:01:53 I was thinking small. They were like 2:01:54 what you should actually be is the only 2:01:56 place to be able to get in front of 2:01:58 content creators or to serve if you're a 2:02:01 brand and you want to get in front of an 2:02:02 audience of a content creator, whether 2:02:04 it is email or podcast or website or 2:02:08 community, we own all of that. And so if 2:02:11 you sponsor Colin and Samir 2:02:13 and it goes extremely well, how can you 2:02:15 find the other 500 or 5,000 content 2:02:18 creators that hit that same audience 2:02:19 like Colin and Samir? And where's the 2:02:21 only place that you can go to get in 2:02:23 front of them across all of those 2:02:24 different mediums? And that's the ad 2:02:26 network that we're building. So I think 2:02:28 we're so early in what we're doing. I 2:02:29 think this can be multi-10 2:02:31 billion-dollar business. 2:02:33 >> Big vision. 2:02:34 Dude, amazing time. Where can everybody 2:02:35 find you? Hit him with the playlist, 2:02:37 too. The Spotify playlist. 2:02:38 >> yeah. I mean Big Desk Energy is 2:02:39 definitely the place to go for sure if 2:02:40 you want to listen to good tunes. My 2:02:42 newsletter is just 2:02:43 mail.bigdeskenergy.com. 2:02:44 That's where you'll get the best 2:02:45 content. And then on Twitter or X or 2:02:48 whatever you call it, dank_tweets. 2:02:51 Amazing time, bro. Appreciate you. Thank 2:02:52 you. 2:02:53 >> Thank you guys so much for watching. If 2:02:54 you got value out of this episode, every 2:02:56 single principle, framework, tactic is 2:02:58 [music] in one free playbook, linked at 2:03:00 the top of the description. Grab it, hit 2:03:02 subscribe, and we'll see you in the next 2:03:04 one.