Andrew: This interview is sponsored by WuFoo, which makes embeddable forms and surveys that you can add to your website right now. Check out WuFoo.com. It’s also sponsored by Shopify.com, where you can create an online store right now, within five minutes, and have all the features that you need to keep selling online. Check out Shopify.com. And it’s sponsored by Grasshopper, the virtual phone system that entrepreneurs love because it has all the features that they need, and can be managed directly online. Here’s the interview.
Hey, everyone. It’s Andrew Warner, founder of Mixergy.com, Home of the Ambitious Upstart. And today I’ve got a guy with me who has a company that sells themes for WordPress. And I know that the quality of his themes are great. I’ve heard people talk about him, but wasn’t sure how much revenue he made until he and I got together to do a pre-interview. And, actually, let me introduce you, before I start counting up your money, Adrien. His name is Adrien, also known as “Ady” Peynar. How did I do with the pronunciation of the name there?
Interviewee: Yeah, it’s pretty perfect.
Andrew: OK. And you sell themes for WordPress. We’re going to find out how you got into this business. We’re going to find out how well you’re doing. We’re going to find out how you get people to buy themes, when I know I could do a Google Search, and find themes for free.
Interviewee: Hmm.
Andrew: And we’re also going to talk about, in fact, let’s start off with this, before we even get into what you’re doing, just to clear it up. How much revenue are you guys making?
Interviewee: I think just before I say the number, and you obviously know this beforehand, just, and we’re not the kind of company that’s going to go around, you know, trying to, you know, to brag and be arrogant, because that’s just not who we are. I think Magnus, Mark and I, you know, we love that fact that we can grow a business organically, without having to tell the people, you know how much money you make. But with that said, we’re definitely a serious business, and you know, for the current financial year, we will be surpassing two million dollars in revenue.
Andrew: This is American Dollars, right?
Interviewee: Yup.
Andrew: OK.
Interviewee: Yeah, well we go South African Rands, you know that’s slightly, you know, we’re slightly than. You know, up north we have Zimbolis, and they even lately are worth less. So it’s definitely U.S. Dollars.
Andrew: Yeah, that’s what I was asking. You guys are all over the world. It’s not a team that’s working out of one location, and I wanted to find out what currency you were using. I also want to, here’s why I specifically asked you before we did this interview, to come on, be open about your revenues. I want to highlight stories here of companies that are proud of their sales, and proud of their achievements beyond raising money. In fact, you guys haven’t raised any money. You guys aren’t the kind of company that’s ordinarily profiled. But you’re doing. You’re creating good product. People love you. They use you. They build businesses on top of you. And there’s a real business to be built there. I saw that you were wiping your face as I said that you guys have no outside funding. And is that true?
Interviewee: Yeah.
Andrew: Or did I… It is true, right?
Interviewee: Yeah, yeah, yeah. It’s certainly true now. It shows you’re thinking. And the way you profile that is exactly the kind of way. That’s my perception of what our community perception is. All right. So I mean companies that get funding without, you know, positive business models, they actually get, you know they put into an unlightened. And when they fail, and they don’t, you know, like deliver on the promise, they end up in the limelight again. And you still have all these companies, you know, smaller companies, new themes, and you know, new rules. We’re still just going on happily, you know, minding our own business, you know, creating our own careers and futures out of that. So but definitely, I think you’ve got it spot on there.
Andrew: Thanks. Yeah, you’re right. You read in the news about all these guys who are raising funds, and all these guys who are raising another round, another round, and it starts to give you a distorted view of what the tech startup business world is really like. These guys get a lot of attention, but they’re not representative of what’s out there, and what could be done. And I think, in many ways, your story of being able to do so much with so little, is more inspiring, and more educational. And even people who raise money can pick up ideas from your experience. That’s why I’m having you here. The other thing before we get into your story, and even explain what WooThemes is,
Interviewee: Hmm. Hmm.
Andrew: I’ve got to ask you about where you are, and where you’re co-founders are.
Interviewee: Well, basically, I’m in Capetown, South Africa, with a large majority of the team. Then you have Magnus up in Sebanga, in Norway. I believe that’s how you pronounce it. And then Mark’s in London, at the moment. But he will be moving back to Capetown, South Africa, as well, because he is definitely a Capetown boy team. So he’s moving, you know, back here later this year. And then we’ve got, as I said, the rest of the team Folksa, Nea, Fresha, Wanda, and Jeffley, all based in Capetown. And then we’ve got Churanzo in Waranza, who heads up our support in Portugal. And lovely Lee Kirstan is in Isle of Skye, actually. So a pretty diverse team right there.
Andrew: Wow. OK. All right. I described what WooThemes is. Let me ask you to explain what it is, beyond just WordPress themes. And actually,
Andrew: And maybe we need to explain what a WordPress theme is. Right? And not a lot of people are familiar with the idea that when you have WordPress, which is more than just a blogging platform, it’s a platform for running websites, that you can just install a theme very easily on there. And that you can, as I said before. You can go online and get a ton of themes for free. And many themes are already baked into WordPress. But here you guys are, building a business, selling WordPress themes. Let me ask you to describe your business.
Interviewee: I think at first, you know, I mean that I would be only superficial in terms of saying that we’re anything beyond WordPress themes at the moment. So basically, the short answer, or the simple answer at this stage is, you know, we sell WordPress themes. And the way I define WordPress themes is that it’s basically just, you know, great looking design, functional, and you know, something that adds a little bit beyond the basics that grind up on top of WordPress. And WordPress simply is account managing system. And even though, you know, that sounds really basic and, you know, redundant, me even saying that. The fact of the matter is, a lot of people don’t understand that, you know, WordPress basically just does things actually with the [daltimus, daltimus] content. It’s up to the theme, you know, that displays that. So that’s what the themes are in terms of as I said that. So that’s the simple answer, you know. It’s WordPress themes. And taking it a little bit further, though, is I think what WooThemes are doing, where we’re trying to head, is taking that mentality of creating something beautiful, yet generic, in terms of functionality. And then hawking that out, to you know, all the accounting managing systems out there.
Andrew: OK. And actually, Jethro in the audience is saying that you guys do more than just WordPress. I know you as the WordPress company. Are you also doing themes for [Juma] and [Jupil] and he’s got I think EE in there too?
Interviewee: Yeah.
Andrew: I don’t know what that is even.
Interviewee: Yeah. Well, basically what we have now, at this stage, we launched three especially deep lost man. So they are out there. We’ll soon be adding, you know, more fresh new themes this month. And then we also have themes at this stage for Juma, Jupil and Textaddon, at various stages of development. When they will go out, specifically, I don’t know at this stage. We just not the company that kind of rushes things. You know, those kind of things need to happen organically. Once they’re ready, you know, we release it. Sometimes that sucks a bit because, you know, we like to hype things up and tease our users. I And we can’t always deliver on those expectations. But, ultimately, we won’t release something until we’re totally comfortable with the fact that we created something that we can actually support and give proper support and quality support, because that’s the be-all and end-all of our business.
Andrew: OK, and let’s see, Gavin Elliott in the audience is saying, ‘just to give people guidance on scale, guardian.co.uk is run on WordPress’ and someone else in the audience is saying that you guys provide, hands-down, the best support or amazing support, for your themes. So, you got a lot of fans here in the audience who are watching you.
Interviewee: Well, that’s good to see.
Andrew: All right, let’s go back to what you did before you started this business. What were you doing before you developed woothemes?
Interviewee: I was finishing off in my final year of studies. I was doing my Honor’s Degree in Business Strategy and Management. And in doing that, the thing ideal to my personal situations, I basically had to find a way to fund my studies. So, up until that point, I basically just, history is, my dad had a computer shop way back when, which meant that I always had access to a computer. In one room, I had a computer, doesn’t matter how old it was. And gaming got boring, to some extent, very soon. So, I knew, I kind of started not hacking like hard-cores or nuts, but I did stop playing around and taught myself web design. So, I must have finally hit, I kind of custom designed a bit of work for clients using WordPress. And then late that year, I realized that, and I’m not ashamed to say this at all, but based on my studies, based on those academics, to those [capacity] models and what not, I realized that there’s got to be something more, there’s got to be a way to take all that hard work, all the hours that goes into customizing a design and work that goes into a raised product. So, in 2007, I think in 2007, I launched the very first premium theme that I ever did. Launched it on my own, and basically just sold it on premium news themes that were common. The idea was, at that stage, only the effort to substantiate my income, I just checked things out. And then things just kind of grew up from there.
Andrew: OK, let’s go back, and by the way, people who are watching the video of this, see me constantly taking notes…
Andrew: …see me constantly taking notes. I really hope people will start taking more notes on my interviews. If I’m doing it, I’m telling you there’s a reason why I’m distracting myself in the conversation to take notes, because it adds to my learning. It also adds to the value of the interview here. And I know that many people out here are considering taking notes, maybe they do take notes. I urge you, take notes, put them up online somewhere. Get yourself some traffic from what I’m doing from these interviews, because we’re learning interesting things that others that may not have the time to watch the full hour long interview are going to want to learn from. And, as I say, you’re going to learn yourself, too, if you take these notes. And somebody in the audience created Mixergynotes.com and he’s taking his notes and putting them up there. I urge others to do the same thing.
Interviewee: I can actually add to that just based on almost the same limitation of meetings. I don’t get the opportunity to go to international conferences a lot. So, just getting to meet and know inspirational people. So, the incident media, these kind of media are not suggesting that anything I say is certainly valuable, but these kind of things certainly took me a lot to, kind of gave me the opportunity to grow my business internationally without being international. Prior to the few upcoming Europe, international travels I have now, I’ve only been to the UK once. I mean, that should be inspiration and motivation for everyone to, there’s a hell of a lot you can do online, just being in your room in your house, wherever that is in the world. You don’t need to be face to face with the big names in the industry to build a business.
Andrew: Did you, I love hearing that. I love hearing that. It seems there’s a belief that if you’re not in Silicon Valley, you’re not really in business. And I love bringing stories of people who are outside Silicon Valley, outside the U.S., and even have interesting backgrounds that aren’t traditional to show that there’s lots of different paths here. Have you ever been outside of South Africa before launching woothemes?
Interviewee: No, not at all. We actually, when [Magnus] organized thoughts at the company, we were working together, we were 13, 14 months before we we met up and featured the web design. In London last year, May, was it April, May? So that was really the first time ever that we had physical, networking space available to us with other people online. Prior to that, it was literally just us building up our little company on our little corner of the internet.
Andrew: OK, let’s go back to what you said before. You started out by custom designing themes for who?
Interviewee: Random clients. I still, honestly, I don’t know how they found me, but they found me somewhere and just as I said, random clients, random small projects.
Andrew: Let me explore that a little bit and just see if I could figure out how they might have. Did you have a blog online that maybe they saw a theme and they said, ‘hey, you know what? I’d like this guy to design my site.’
Interviewee: Yeah, definitely, I had the blog and way back then, I did a lot of free workers themes, so basically just painting the theme. Not even theme, because there was no, or theme in the same as a dollar-free theme and hopefully, commission me for custom work.
Andrew: Ah, OK, so you showed the theme, and you said ‘if you want to commission me, here’s how to do it.’ And some people found you that way and hired you. How much were you getting paid at the time?
Interviewee: I got to think back now. First thing that I can remember, the very first work we seen, I did custom work, I got paid $100. And I’m really ashamed to admit that. I know, obviously, why? Just because, I think, way back then, even then, that wasn’t a lot of money. That was pocket money, really. But I was a student, I didn’t have bills paid, what not. I say I’m ashamed to say that, because I realize now how much hard work really went into that. And I was really undercharging and undervaluing the work I was doing. And just as a side note to that, the more people that actually do that, kind of creates a bad perception with clients about what they should be paying for proper design and development.
Andrew:
Interviewee: I see. OK. All right. I can see how you were undercharging and I can see how that would make you want to now start finding a more scaleable business. And that’s what set you off to create a theme, a premium theme that you could sell. What did that premium theme look like? What features did it have? Can you give me a sense of it?
Andrew: I like to think that it was pretty unique way back then at that stage. And I can give kudos to Brian Goneau, who’s the empress, because I think it was about a month or two just before that, he was actually the first work place to fill up with, to explore a commercial model. And again, I am not ashamed to say at all…
Interviewee: And again, I’m not ashamed to say it at all, that kind of gave me, not the idea necessarily, but the motivation to actually see if I can do this as well. In terms of feature sets, at that stage the themes you could download for WordPress very much blog orientated. So traditional blog, content side bar, simple as that. So I totally ran and I think the whole of 2008, part of 2009 was centered around this buzzword called ‘magazine design’ or ‘magazine themes’. And just kin of take from the donkey and stuck premium news themes on that and ran with that train and created something that the average person just couldn’t do without paying a thousand or two or three dollars having that custom made for them.
Andrew: All right. Let me see if I understand this. Let me unpack what you said here. Brian Gardner, I remember him as the guy who created these beautiful themes that, as you said, he was one of the first people to charge for his themes. He also brought on this magazine layout that didn’t look like a blog where it was just a list of posts but something that looked more like a magazine website. And he started selling it and popularizing. Are you saying that the first theme that you came out with was also a magazine theme? That you just said, ‘If this is working for Brian I could do the same thing and start selling that too.’
Interviewee: Definitely. I was just going to say, tongue in cheek, I’d like to say I improved what Brian did but that’s probably down to marketing and what not. The themes are pretty much on par and I’ll let the users decide on that, tongue in cheek. But just on that, on copying and taking inspiration from elsewhere I’ve never been ashamed to admit and also we can get their later, working the subscription-based model was copied from the another company in the Joomla environment. And for me it’s just about taking that inspiration and just trying to do it in a little bit different way and seeing whether you can build it. Or you can find traction across your own audience of people that relate to you and selling that product to them.
Andrew: Okay. And so you said that what separated you from him was marketing. Which brings me to my next set of questions which is how you got anybody to buy this theme. How did you do that?
Interviewee: I think at that stage my blog had quite a little bit of traction and I think round about the same time… and I saw a question, I don’t know who asked, but people are talking about why I call myself ‘Rock Star’ Round about that same time, I think just before I launched the first theme, I had decided to basically go for AD WordPress Rock Star and using WordPress Rock Star as some kind of a tagline to this brand. The reason I call myself ‘AD’ and I don’t go by Adrian Pinar was just because of pronunciation on line. So as I say, so I had the blog, it had some traction and was definitely geared towards WordPress. I was talking about WordPress, I was talking about freelance. So I had a relevant audience basically to which I could punt. I can remember the first month or two of that the only place I marketed these themes was through my blog. I mean, in that stage twitter hadn’t even got on traction with me personally so I didn’t have the following I have now via twitter. It was purely by my blog.
Andrew: I see. Okay. So you had your blog audience. You said, ‘I’m selling this theme, does anyone want to buy?’ How many customers did you get from that? Roughly. This is a long ago but are we talking dozens, hundreds?
Interviewee: No. It’s hundreds and it’s not significant. I probably estimated that you know, if it was 200 or 250 that was about it in the initial month or two. So nothing significant but enough of a seed to basically grow a business from. Based on that Magnus emailed me and said why don’t we collaborate? So there was enough traction then in terms of the basic model, in terms of audience, in terms of marketing, everything had enough traction to make us believe that we could create something viable.
Andrew: Okay, let me see if I understand this. First theme that you put out there that’s a premium theme, you get 200 to 250 people to buy it from your blog. How much money were you selling it for?
Interviewee: I think it was $100 back in that day.
Andrew: $100 times 200. This is pretty impressive for just the first effort. What’s next? Now the next thing is you’re saying that Magnus found you and said, ‘Why don’t we partner up?’
Interviewee: Yeah, Magnus at that stage I think he just got into WordPress a month or two before. And I’d actually seen his work randomly and I’d actually secretly admired his work because he had a nice little touch.
Interviewee: …and I’d actually seen his work, randomly, and I’d actually secretly admired his work, because he had a nice little touch and it had seemed that the themes he was creating were top notch, and in the next moment I actually get this email from him, saying you know aren’t you keen to basically collaborate on a new theme. So, I immediately said ‘why not,’ simple revenue-sharing agreement, nothing overly committed, in terms of the longer term, and we’ve created a theme together, similar to the first theme, just building on that, just going for a little alternative. And that kind of created more attraction because that kind of took the initial idea of just doing one theme and I realized that, if you have one theme, you can have two and you can have three and you can ultimately have 100 and
Andrew: Why did you think you need it? Why couldn’t you just say to yourself ‘look I created this one theme, I sold about $20,000 worth of this one theme on my own, I don’t need another guy here! Maybe I’ll hire somebody else to design another theme for me so I can sell a second one without having to design it all myself but, I don’t need to split revenue with this guy. ‘ Why did you decide to do that?
Interviewee: Um it’s a difficult question, I’m just, you know my background is my dad always told me a parked ship is a sinking ship, but I can honestly say with Magnus and Mark it’s probably one of the best decisions I’ve ever made. And ultimately when we need to move things, we’ve totally democratized in terms of shareholding, the three of us are equal shareholders in the company, and purely because, you know it doesn’t matter how much I can hype myself as ( ) Rocks or this absolutely brilliant entrepreneur, having that partnership and having guys that are ultimately invested every decision I make influences, or a third of that decision influences their income, which means that they’ll have an incentive to keep me level-headed, and vice versa.
And from the very beginning, that was important to me. So what they’ve got is that incentive and being accountable and being invested, not just in terms of the profits, but also in terms of the longer-term sustainability. So, I don’t necessarily know why I did it at the first stage. I think the simple answer is the fact that I couldn’t manage the workload myself. Plus, I knew I was limited both as a designer and a developer. So, for me I think it was doing something sustainable and giving someone else the reason to build something with me, basically.
Andrew: Why Magnus? What was it about him that made you say ‘alright, I’m gonna partner up with him’ ?
Interviewee: Hmm, I’ll try and say something quirky now like he’s the absolute, the sexiest wordpress designer
Andrew: (Laughs) But, you must have looked him up at least online or knew about him or knew him before this, so what was it about him that made him stand out?
Interviewee: Yeah, I think he well he had a few themes out, himself, a few themes, that he was giving away, and there was definite quality in that so I think that the quality of his work spoke for itself. And I think in terms of the email that he sent, and this is another tip for everyone listening and tuning in, it was very professional and to-the-point and didn’t waste my time. He had good ideas and he was willing to act on those ideas immediately, which immediately made me feel ,’why not.’ I think ultimately in business you get that first few seconds of a decision and you get that gut feel, just of’ why not.’ It makes sense at that stage to just gun it.
Andrew: Okay. Actually before we continue, I’ve got to ask you about what you did beyond just posted on your web site, because I’ve found that I get great feedback when I really dig into especially the early days of how people market. So, did you just put a blog post up on your website saying ‘I’m selling it,’ or was it something a little bit more to the way that you promoted it?
Interviewee: I think this approach, and actually you’re making me think, thinking back now, I think this approach is still evident in how we market our stuff today. After the first theme, and once Magnus had come on board, I started using, basically, teasers and hype, so putting concepts out there even if they were works in progress, putting them out there, getting comments, interacting with potential buyers. So I think that continued way into December and when Magnus’s or, our collaborated theme was ready we actually launched a secondary site for the themes, and along with that we had an affiliate program.
Interviewee: …and along with that then we had an affiliate program into which our users, even though it was limited, our little user base but they could tap into their affiliates or the affiliate program and they could actually promote the themes on our behalf.
Andrew: Okay, I’ve got a couple questions about the affiliate program and I want to come back to that. But let me make sure that I understood what you’re saying now because it’s interesting. You’re saying that you kept showing people screen shots of what you were working on. You kept saying, ‘This is what’s coming. This is what it looks like. This is why I’m doing it,’ and did you get feedback from people that made you adjust what you were working on? That made you change a theme a little bit based on what they were saying?
Interviewee: Oh, totally. Way back then, and it was much easier as well then, to basically go in a completely different direction with a concept. It’s a little bit more difficult now but way back then I sincerely think that we were running the company in an extremely open and accessible way and we really listened to what people had to say. Because we didn’t necessarily know ourselves what was the best decision was to a specific question.
Andrew: Do you have an example of how the audience shaped what you were building?
Interviewee: Do I have a…
Andrew: Yeah. Do you have an example of how the audience shaped what you were building?
Interviewee: I think, you know and obviously we’re talking about two years ago so memory is a little bit fuzzy. I think using the recent example, I don’t know just if you still the [INAUDIBLE] functionality that we built a few weeks ago, or released a few weeks ago, that got into WordPress Core and will be released when version 3.0 comes out. But that is exactly the kind of thing that our users had been moaning and bitching about in our support forums for years. Ever since we started this we knew that navigation was going to be a problem. And I think that ultimately it’s not necessarily that easy to act on that immediately or in a timely fashion in terms of everyone’s expectations but that’s a perfect example…
Andrew: What are we talking about with that? What’s the nav bar that’s going to be integrated into WordPress?
Interviewee: Basically in the past you had either [INAUDIBLE] screens or pages and you can display those. So if you had to intermix those or you had to include links to outside of your WordPress install, you were basically left doing that, hard coating that. So what we’ve basically done is add a functionality into the WordPress dashboard that mixes all of that in a little jquery drag and drop so even my mom would be able to use it.
Andrew: To do what? I’m sorry. I’m not following this part.
Interviewee: I said my mum would be able to use it.
Andrew: To do what? What would…
Interviewee: Manage menus and just simple site but really customize menus and use it the way she wants to use it, not be exposed to the limitations of WordPress itself.
Andrew: I see. To link out to pages apart from your WordPress installation. I see, okay. And then manage where those pages are going. Okay. All right. When did you guys decide to…actually, you talked about Magnus let’s go to Marcus. How’d you and he hook up?
Interviewee: I started actually when I finished studying at the end of the 2007, started a new job, also in an unknown space, corporate job, and then I knew that Mark was actually in Cape Town at that stage. And up untiI that point he was someone I really looked up to since he was from South Africa and he had been making a name for himself as a designer. So I emailed him and said, whilst you’re here can we grab a beer, can we grab coffee, whatever? And we just kind of chatted. I told him about the collaboration with Magnus and said that we started to build something; there was definitely income worthy to explore there, are you keen? And I think a month later I think early Feb 2008, we released our first collaboration with Mark.
Andrew: What was that first collaboration?
Interviewee: It was Gazette. It was a theme called Gazette Edition, very similar to the CNN site way back then. And I think it’s still number five or six in our all time top selling themes.
Andrew: And what website did you guys sell these themes from back then?
Interviewee: They were all still going. The third theme we released on Premium News [INAUDIBLE] a little site I had actually put together, no membership management to speak of. It was really just hacked together, front and side with a little bit of a blog and then payment links or payment processing link and links out to ejunky who was handling the payment at that stage. Or file delivery.
Andrew: Yeah. Ejunky creates these great shopping carts. Easy to implement, they look beautiful and they just work. And that’s what you were using for how long do you think? Roughly.
Interviewee: We used that up until June, July of 2008.
Interviewee: June, July 2008 we basically switched over when we released or rebranded as new themes. We rewrote the backend and went for a more integrated approach as far as managing our members and the support and what not.
Interviewer: Let’s talk about the affiliate program, when did you start that?
Interviewee: Mid December 2007 I think if I remember correctly, we launched that exactly at the same time magnus or we released the first collaborated theme with magnus. Basically we released that as well because before that I literally just had the sight setting my original theme just a site running on my theme to basically demo it. The only thing it had different was the package anyone could buy and the purchase link in the main navigation. So when magnus released its theme we obviously needed to change stuff around basically create a site that could show case more than one theme so when we released that we released the real program as well.
Interviewer: Why an affiliate program, and why so early on?
Interviewee: It’s cheap marketing basically. If someone else is willing to say buy themes from these guys then you must be doing something right. So I think in terms of it’s not costing us anything so it makes complete financial sense.
Interviewer: And how did you get the affiliates? Was it just from your blog, was there something else?
Interviewee: I think initially it was form the blog. It was also a transitioning phase going from moving attraction with regards to the themes off of my blog onto, I wouldn’t call it a company site, but the project site at that stage. I think it was partially people interested, partly people looking to build cash, and partly people actually buying the theme. They figure we can kind of recoup what we paid for this theme if we advertise with these guys.
Interviewer: Did you actually make every customer into an affiliate automatically?
Interviewee: If I remember correctly ejam actually does that. Once you’ve created a log in with them you simply need to log in again and enable yourself as an affiliate. All of the buyers have the choice of doing that.
Interviewer: We have been talking about e junky. Every time I talk about a specific website they email me and ask me how do you type that in? Transcribers have a hard time figuring it out, so ejunky is the site we are talking about. Let’s see what else we want to talk about. The reaction, I mean I am going to get into how you got into the millings but I want to talk about the first few customers. Because I think that tells a lot about how you grew. The reaction to you selling themes around WordPress which is an open source platform available for free that has plugins and a community that’s just there to just give stuff away for free. What was that like?
Interviewee: I think most people at that stage were quite cynical, cynical in a sense that it’s something they weren’t used to. Like you said it was open source so they were used to getting thousands of quality themes for free. So I think we met cynicism but even way back then, and it’s the same as it is today. I have always told other people when it comes to open source verses commercial application into conversation people that ultimately buy themes, buy them because they find value in that. That’s all I have to say on that.
Interviewer: What about Newton in the audience is asking about a question that a few people are talking about. He is asking about pirates. What do you do about people who are just copying your themes?
Interviewee: Nothing. Technically they are allowed to do that. Luckily for us there is no application for that because people can sense out pirates very easily and ultimately, I have gone on record saying, people that are willing to knowingly download a pirated theme instead of buying the real product, I don’t want them as users anyway. Because they are the kind of users that just find ways to rip me off and make my life hell. They are not the normal kind of users to worry about anyway.
Interviewer: I see, can you explain a little more about the GPL? How that makes it ok for them to steal?
Interviewee: Well It’s not stealing per say. Basically the GPL gives us first the permission to actually sell our themes, but in respect of what we do .
Interviewee: themes is still the user that buys it from us also inherits the gpl and inherits the freedoms that go with that so, one of those freedoms are, they can redistribute it, or they can resell it,and few other things they can modify it. They don’t have to modify it. only requirement being they actually need to, you know leave out a crepitation base intact. They need to specify that these sections or this part came from were themes.
Andrew: So, if I wanna buy one of your themes I can technically take it. Put it on mixdude.com and start selling it myself?
Interviewee: Ya certainly.
Andrew: That doesn’t damage your business. Why would anyone buy from you if Andrew on mixadude could sell it too?
Interviewee: Well! I think you know this is , I think what people fail to realize is that customers especially on-liners, they, you know they trust brands. they trust things that they know, they trust the things that has a reputation, a credible reputation. So, you know on a sketchy means what people have said about workers itself
Interviewee: … You know we have people that pass and that… Now… Way back then it was six or three-month cycles, but now we have them paying on a monthly bases. So, the great thing about that you can kinda forecast your income and expenses and do proper planning based on that. It’s the perfect, absolute perfect personal income model.
Andrew: I see but once I have a theme for my website, why do I need another one? Why do I have to be a member three months down the road?
Interviewee: I think, you know, our clubs is trying… all club members, all developers, all business owners, or freelancers, someone with some kind of commercial application. I don’t think we have a lot of enthusiast, you know, bloggers or web sit owners, you know, that have a subscription purely for the luxury of being able to, you know, to pick any theme and change a theme, you know, when, you know we release something new. So I think the, you know, the most people on club subscriptions have some kind of commercial application for that.
Andrew: I see, ok. We talked about the two million in revenue, can you go back smaller and talk about what was it like to earn the first million dollars.
Interviewee: Incredible! I think, you know, throughout the two and a half years that me and Magnus (…) have been working together I think we continue to be astounded by the growth we have experienced. Specially because we were doing something that we were loving and I’m not saying we are not an ambitious bunch. I mean, I think every business decision we make, you know, we try and use sound, you know, business logic with regards to that, but, I mean, we absolutely ecstatic. I have actually no idea how to explain to anyone how, you know, just sitting here, just feeling absolutely blessed and honored, you know, being featured on a site as big as (…), just put things on me lab, that is a truly incredible experience.
Andrew: Was there a moment where you actually saw the number “a million” or over a million in your account for the first time that you remember?
Interviewee: No, unfortunately not.
Andrew: It just passed you by.
Interviewee: Yes, it actually, to some extent, you know, because nothing ever changed. Not in our business model, not in our personal lives, you know, I didn’t go and buy a Porsche or a Lamborghini or something. So, you know, to some extent it was just statistic, a reporting in terms of our accounts. It wasn’t that a significant thing, you know, it wasn’t even a significant achievement. So…
Andrew: Was there a moment where you said “OK, this is gonna be a business”? Was it when you hit the twenty plus thousand dollars in selling the affiliate, selling the themes on your site?
Interviewee: Yeah. I think, well, right around that stage, you know, I felt this attraction, you know, beyond, you know, beyond just this side project and as I mentioned I had a bit of a corporate job at that stage and I only stayed in that job for two months. And I ultimately quit that, partly because I already had, you know, a side project, you know, that I was still running, that I was still, you know, earning a good, you know, secondary income. So, yeah, I think, you know, very early, you know, I had wanted to take the chance of exploring this and seeing if I could make a career or a longer career out of it.
Andrew: Alright, let’s take one of the questions from the audience, actually, there is a lot of conversation here about when you guys are gonna launch Tumbler themes. Is it Tumbler themes? Is it gonna be in February 20th, is there another date you’re talking about?
Interviewee: No, there is no complete date. I can share that, you know, we have been in contact with Tumbler and I actually had a good conference board with them last week about, you know, bringing commercial themes to the community because they had no, you know, commercial themes or web application that were business model, you know, so to say, at this stage. So that is still something of theirs in the works and when we had our check last week, they didn’t have complete details about roll out either, so we basically just, you know, chatted. It’s just nothing more than conversational stage exploring, you know, how and when that we can work together or not for bringing some more or some missed Tumbler as well.
Andrew: What about post postress, or I guess they pronounce “postress”?
Interviewee: Yeah… Same thing there, at this stage it’s because postress, you know, there is no marketplace for it right about now. So, same thing, in conversation with them as well, something we’ll explore totally depending. I think, you know, just libeling with everyone just listening in, in terms of where things are going in the future. I think we would be willing to explore any popular, you know, system, community, you know, (…) system. At least initially, a little bit, you know, at least a theme or two and see whether there is traction on there. So that’s why we are in conversations with, you know, the players in those spaces.
Andrew: What inspired you to direct the film?
Interviewee: Great question. It’s a long story, but I usually…
Andrew: Can you start at the beginning?
Interviewee: Sure.
Andrew:Thank you.
Interviewee: Thank you . Bye.
Andrew: So how did you get Tech Crunch to run a discount code for you? That’s basically an ad. When somebody says here is a discount, they’re saying ‘Go buy it, we’re making it easier for you.’
Interviewee: Honestly, I think if I remember my interaction, because I organized that article with Daniel, and I can say organized in the sense that I brought it to his attention that we were doing a special engine*. And again, similarly for a start-up of our size and without the funding and going back to those limitations of mainstream tech-medias, I’ve made connections with various prominent figures within in the tech-media space trying to get us featured but never trying to get us featured in terms of, you know, only trying to get us featured if the story is news worthy. I’ve tried a few different angles and ultimately the angle that Daniel decided on was that we were going to release special engine** themes and we were the first to do that. And I still think objectively that my story had legs, so him tweeting and, sorry, I made a long story of that but the coupon code for us, you know we did coupon codes for a lot of different promotions and it really was an afterthought, it was just like oh, stories already written and here’s a coupon code if anyone wants it. So that never entered the fray in the initial discussions.
Andrew: I’ve talked to people in the past who have gotten traffic from a Tech Crunch article and they’ve talked a little bit about the conversion rates. I’m going to ask you about your traffic and conversion rate from that article. And not exactly, but if you could just give me a sense of it.
Interviewee: Interesting enough, there was no immediate spike in traffic and even though the site went down on the day that Tech Crunch published the article, I think there was a lot of traffic coming in within a half an hour frame so it put strain on our server but the traffic wasn’t significant. If we had a 10% spike in the first three days I think that’s about it. And neither conversions, they weren’t higher or much different from before. So I don’t think initially there was really a spike at all. That was just as surprising by the way. I do however think that judging by the growth in the traffic to the site since, and we’re about a month down the line now, I do think that being featured by Tech Crunch had some kind of a longer term more sustained effect on the increase of our traffic.
Andrew: So let me see if I understand it, you guys had a spike that took you down but it wasn’t a major spike, it was just that it all came within thirty minutes? Overall you had sustained business from it, or sustained business growth ñ why? What kind?
Interviewee: I think, obviously this is me guessing because I actually have no idea in terms of how many and analytics are difficult in the sense that it’s one thing to see that there’s X amount of boosters coming in from techcrunch.com, but there’s still the brand awareness thing. There’s no way of me telling that you might have seen the Tech Crunch article, never clicked a link, but a week down the line you needed work for a client and you remember Woothemes and you Google Woothemes, and Google gets the credit for sending us the hit but because of the Tech Crunch article and the brand awareness, you know that’s actually why we got that visitor or that click or whatever. So it’s totally guesswork and I think that in terms of that there has been sustained effect in terms of increased traffic.
Andrew: Let’s go into margins. What size margins are there in a business like this? Net margins, not gross.
Interviewee: Net margins are, I think, we’re probably at about 50-60% now from the top of my head. Obviously they’ll be confirmed at the end of this month as that’s the end of the financial year in South Africa but that’s pretty much an accurate estimate at this stage.
Andrew: What’s it like to build a business from South Africa, to be so far away from the US where I’m imagining… actually, is the US the biggest part of your market?
Interviewee: Yeah, I’d estimate probably about 65% of our users are from the States.
Andrew: So what’s it like then?
Interviewee: Challenging. We have really shitty broadband in South Africa and I’m surprised that I can actually do this video. I mean, it’s not that bad but there’s generally a lot of limitations. Bandwidth for example is extremely expensive and there’s a lot of hurdles to overcome. You just kind of get used to it after a while. I’m used to not having a fast internet connection and I just work around it so it has limitations and I think I alluded to this earlier…
Interviewee: And I’m just working around it. So it has its limitations. And I think I alluded to this earlier, when I said about networking opportunities. I think for me personally, in terms of just connecting with, you know, really inspirational people, on a subject that I’m passionate about, is something that I actually love to do. But also you think of the African space. You know we’re limited. And here’s why, you know, I’ll be traveling in the next few months, I’m sure to look up, you know, quite a few people that, you know, that has inspired me, you know, up until that stage. Because I crave that interaction. But, you know, beyond that, you know, I would say we still managed to build a business, you know, without having that at our doorstep basically.
Andrew: How old are you now?
Interviewee: I’m 25.
Andrew: 25. So you started this business when you were how old? 23?
Interviewee: 22.
Andrew: 22.
Interviewee: 22, 23. You know?
Andrew: Were you all around that age? Were you all in the early 20s?
Interviewee: Magnus is a little older. Magnus is 30 now. So yeah, but Magnus was late 20s. Mark was, I think, three years older than I am, two years older than I am, so.
Andrew: OK. I get a lot of crap for the headlines that I come up with in Hacker News. And so I’m kind of fishing for one of those…
Interviewee: Yeah.
Andrew: headlines that will get a lot of traffic, but will get the people on Hacker News a little upset. I’m looking for something like, “How 3 Guys in Their 20s Built WooThemes, the 2 Million Dollar a Year Plus Theme Business”. Or something like that. What did somebody in Hacker News say? It’s “Andrew’s formula is how someone just like you did something outrageous.” So it’s “How 3 Guys with Nothing but a Computer Built this Big Empire”. I’ll look for that when I see the transcript. I’ll see if I can find that “How they’re like you moment”. All right. I’m very fascinated by, and I could almost do a whole interview with you on this, I’m fascinated by membership sites. I’m wondering what you’ve learned about how to get more people to join your membership site, that maybe the rest of us can learn from.
Interviewee: I think firstly say it’s probably what I haven’t learned, to do that. It’s difficult, I think, because it’s always a challenge to go after people who are committing to pay a monthly cost. I think people try to avoid that because immediately the overhead thing, you know, comes to mind. People avoid, you know, general business advice is, avoid, you know, unnecessary overheads at all costs. So, that’s difficult. I think the only success you can have is basically finding a balance between, you know for us, for example, it’s finding a balance between releasing something really nifty and flashy and something new. But that something new might not necessarily solve a problem for one of our users. So we need to balance that by releasing just a newer version of something old, something that we know solves problems, creates businesses for our users. So, basically that balance, and just continue in pushing that same. The only way people, I think, commence paying you a monthly fee is when they see that you act like they’re not going to commit to something now, and then a month or two down the line, you’re not really doing anything more.
Andrew: Let’s take a look at one of your themes here and how you sell it. I’m looking at the postcard theme, which, man, you’re themes look freakin’ beautiful. This is spectacular.
Interviewee: Most of us loved doing that.
Andrew: Did Matt Mullawag, what does he think of your themes? Did he comment publicly on them?
Interviewee: No, he wouldn’t. I think, as a result of the perception that is extremely bad vibes, between the commercial theme guys, and Matt and [code]. Basically, he wouldn’t necessarily comment. Just, my section is for fear of being flamed for that. But, I know, maybe, Matt…
Andrew: I’ll tell you why I said that. First of all, I had him on here. He is the founder of WordPress, the co-founder of WordPress, and the founder of Automatic, the company that now runs wordpress.com. That’s who he is, for anyone that doesn’t know. The reason I say it is, that he is the creator of WordPress, the guy who is standing behind it has got to see these themes and be proud, and say ‘look, I built code. I believe code is poetry. But what these guys did, that’s a whole other level of art that they’re introducing to the code that I have put together.’ So, I got to believe that he loves it, and, but who knows, who knows? I have also heard him say… Uh-huh?
Interviewee: Sorry, I mean I’ll just say, I think ultimately, for instance, a very big thing I touched on the numigation functionality that we had developed at last. For us, the ultimate kudos from basically the WordPress founders or founder and the Lean developers basically asking us whether they can use our code and integrate that…
Interviewee: For us, the ultimate kudos, basically, from the WordPress founders or founder and the lead developer, especially asking us whether they can use our code and integrate that into their core, because that means that tens of millions of users will be using that.
Andrew: Okay. All right, so let’s go back to what we were saying earlier. So, I’m looking into a specific theme, here’s what you show me. You show me the theme a little bit bigger. You say… you show me the unique features of this theme, like I can create a custom homepage slider, I can integrate Google Maps and an image gallery and a bunch of other things in here. And let’s see what else you do. There are a few other options here, including a “Try Before You Buy,” which I’ll talk about in a second, but I also see on the right here that you offer three different purchasing options. You say, “Buy it as a Club Standard,” which is one-twenty-five slash fifteen, which I understand because I know your site needs a hundred and twenty-five dollars right now, today, and fifteen bucks every month after that.
Interviewee: Yep.
Andrew: You also offer the “Club Developer,” which is two hundred plus twenty a month. Then, you offer “Standard,” which gives me seventy dollars, which lets me just use this one theme. And then you’ve got something called “WordPress Developer,” which… what does that mean?
Interviewee: It’s actually just, the only difference between… or, there’s two differences between the Standard and Developer packages. Install the individual theme – for Standard you get two bonus packages, whereas the Developer package has three bonus themes, in addition to the one you actually choose. And then the Developer package includes the Photoshop files. So, for designers or developers, it’s just much easier to customize a theme if you have our original layered Photoshop files.
Andrew: Okay. All right. By the way, for anyone who’s listening this far into the program, come back to Mixergy and give me your feedback. Do you want me to dive in deeply into this kind of specific set of questions, or were you guys over it a while ago? I’m really curious. To me, I’m fascinated, and I would love to show you your homepage so we can both look at it together, and then start dissecting every piece of it. Since we can’t do that, really, and show it to the audience at the same time, I’m just going to ask you a question about… I’m just going to ask you questions about your decisions here. Why show all four different pricing options and not have one button that says, “Buy It Now,” and then, after that, separate people out into which buying option they want?
Interviewee: Well, it’s probably… it’s an extra click, basically, because if you do that, then you’ve got to send them to the next page which then details what we can already do on the one page. So, it’s just saving everyone one click.
Andrew: Why offer four instead of three, which seems to be the common set of options, or instead of one, and then upselling them later on the others?
Interviewee: I’m not a big fan of upselling, by the way. To the extent, for example, that GoDaddy does that, I’m not a fan. So, I’d rather just… because the Club versus buying an individual theme is two different products… so what we’re basically doing is we’ve got a club where you can buy individual themes. So, that’s the first choice you could have made. And then you’ve got to decide whether the standard package is fine or whether you need a little bit more, to go up to the Photoshop files and Developer packages.
Andrew: Okay. How did you decide what to put in the Standard and what to put in the Developer? How did you even decide to create a Developer package?
Interviewee: Total guesswork. I think we’ve tweaked that four, five times now. So, it’s just trying to find something, find structure to use, and the only reason… there’s no science to it. The only real way to do that is to base it on user feedback and tweak, and tweak, until you find something that basically works, and is [unintelligible], and is appreciated by the users.
Andrew: What was it like before you tweaked it? I want to get a sense of how the audience shaped what went into the standard and what went into the developer package.
Interviewee: So, for example… well the Standard and Developer have always been the same thing. I think the only thing we have changed with regard to that is actually decreasing the price and actually increasing the amount of bonus themes you get when you purchase individual themes. So, that’s the only thing that’s changed on that. I touched on the [unintelligible] of the descriptions of what we did, and that is, pretty recently we had three- and six-month options. So, you were being billed two-hundred-odd dollars every three months, and we changed that to be almost more valuable in the longer term. So, you still pay the initial fee, a sizeable fee up front, but it ultimately comes relatively cheap.
Andrew: Okay. I see. And then, if somebody stays a member of the Club, what happens from month to month? What do they get? Access to all the themes?
Interviewee: Yeah, we basically… well it’s obviously the support, and they continue to get the support resources. Once they’re not a member anymore, they still get access to support resources but don’t get access to theme updates. So, WordPress pushes our new version that conflicts with the old version of our theme, and they need to re-signup to actually get the update of the new version.
Andrew: I see, okay. All right, and that’s why you want to stay a member because that’s the only way to get the latest versions.
Interviewee: Exactly.
Andrew: What about in the audience? Anyone have any other questions? I think I’ve covered everything here. What do you think? Is there something else that people need to know about how you guys sell online?
Interviewee: No, I think in terms of just based on how we sell online, when we created the current site, we just took inspiration from all the best guys out there. So you will see basic [xx] signals that had a huge influence on our site design. Comparing one [?] to the huge influence. So it was like we were just going about finding the best of what we thought–and it’s still guesswork–but finding just a starting point, the great examples that are already online, and constantly tweaking that until you find something that really works.
Andrew: James in the audience is asking, ‘What advice do you have for somebody who’s starting out in a theme business?’
Interviewee: Specifically workers themes or specifically in the workers’ community, I’d say anyone would need to spend a lot of time marketing themselves or creating an orientation [?] themselves I think because in recent months a lot of people are trying to sell workers themes because it seems really easy. But it’s not necessarily that easy, and people won’t just buy it from anyone because there’s a lot of these one-theme wonders. They come along and try and sell one theme, and they just fall off the wayside after that.
Andrew: OK. But why haven’t you? What have you done? You said earlier that one of the things that separated you was marketing. We got into a little bit of affiliate programs. We got into how you had an audience for yourself. What else do you do that’s so spectacular about marketing?
Interviewee: We try a lot of stuff. And again, it’s experimental, and it’s a hell of a lot of fun. For example, our current promotion running now, Send Some Woo Love, was centered around the Valentine’s Day [xx] and whatnot. But that allows any of our members to send a 50% off coupon to as many of their friends and family and whoever that they’d like.
And I see as Jeff [?] was pointing out with the Boobs Campaign. The Boobs Campaign was centered on, obviously–anyone that followed it–we specifically said in pink in October for breast cancer awareness, ‘We love Boobs.’ And we raised money for charity. And beyond us giving back and doing something good, that was marketing. So just doing something a little out of the ordinary and really marketing a brand for your company.
I think all our users would associate the ninjaóthe little black guy we haveóor the specific Woo logo, or just our approach, our mentality. Everything that we say at this stage, it’s seamless and it’s integrated with our marketing. And because of that, it’s more of a discussion. And that sounds totally silly, and me using buzzwords, because social media’s apparently all about conversation and interacting. But to an extent that is all it’s about. Continue keeping your audience interested.
Andrew: All right. Let’s leave it there. We’ve already gone way over. Thank you to all the transcribers who are going to be working on this.
Interviewee: [laughs]
Andrew: Thank you to the audience who stuck with this all the way to the end. Before I say goodbye to you, I would like to ask the audience for feedback here. I’m going to ask them a few things actually.
First of all, feedback. What do you guys think of interviews that go this long? I know that the standard content on the Internet is a two-minute video or less. I want to know your feedback of it. What do you think of the questions that I asked? What do you think of the direction that I took the questions? What do you think of just even having Woo Themes here on Mixergy?
Is this the right kind of company for you? The more feedback you give me, the better I become as an interviewer. Also, don’t just take this information. Find a way to get it out there. Maybe it’s just writing it down for yourself because I know that if you start writing down notes from these interviews, you’re going to start to use more of what we’re talking about here.
But more importantly, I’m noticing some of the big bloggers now are taking my interviews, they’re pulling out the bullet points of what’s been going on, of what’s been said, and then they create these blog posts that get insane traffic! I say, ‘Why should these guys who are Johnny-come-latelys to Mixergy get all that traffic and get all that attention?’ You guys should do it. Write it down on your blog and start tweeting it out. I’ll tweet it out. I’ll help you guys get traffic with it.
I know that we said some things here that are either news breaking. In fact, I don’t know that you guys have ever said how much revenue you’re making with Woothemes.com, let alone the margins. I know there’s some news in that. I know there’s some business tips here that people can use.
Let me also say this. To the skeptics who are saying, ‘Andrew’s just doing this because he wants links back to Mixergy.’ Let me say, ‘Yeah, you’re damn right I want links back to Mixergy.’ But that’s not the big goal. The big goal is if you don’t link back to me, I am going to be happy if you just do this because I know that you’re going to become inspired just by writing it down. And know
Andrew: Because I know that you’re going to become inspired just by writing it down. I know that when you start pulling out information to share with the world about what WooThemes is doing right, you’re going to start to get that stuff in your head. And then two, three years from now, that’s when I’m going to get my payback. Because you’re going to say, “Andrew made me write this down. I actually started using this thing. The freakin’ tip that WooThemes used, that they gave away for free here on Mixergy, I now have in my head. I used it in my business. And that’s what helped me to grow. What do you think of that? Is there any logic in that? Or am I just ranting because it’s the end of the interview, and I know I’m only reaching out to my most loyal fans.
Interviewee: Oh, no. Oh, no. Totally. I think for anyone that hasn’t built a business before, the easiest way of doing it is, just, you know, grab the inspiration from other people that have done it. You know, shared their experiences, and what not. So Marcus is, by the way, just before I met Delowin, when you’re going to cut me off, Marcus just asked me that I was supposed to say “Hi” to his mom. So “Hi to Mark’s mom.” I haven’t met her, but just “Hi” to her, as well. So that’s a wrap.
Andrew: All right. I will say “Hi” to his mom, too. I know.
Interviewee: [Laughs] No, but let me tell you, I mean you know, these kind of things, interviews such as these, there is value in there. I think challenges just for every unique individual to find their own value, you know, and relate that to their context. And if they can do that, then perfect. I mean just copying what we did isn’t going to work. Just for us copying we’re finishing the signal, isn’t going to work. But we can find bits of unique inspiration and use that related to our own business.
Andrew: All right. OK. I’m not going to cut you off. In fact, I’m actually going to ask you how people can contact you. How can people say “Hi” to you, or thank you for doing this interview?
Interviewee: Well, they can reach me on my personal email, which I’ll give out. Don’t mind doing that. It’s Adii@radiiate.com. Just note the double “i” in radiate, as well. So they can reach out to me. Otherwise, you know, comment on the blog. There’s no contact form on the blog right now, so, but they can comment on the blog, and that’s at ausortofrocks.com.
Andrew: OK. Why no contact form on the site?
Interviewee: Partly because I’m lazy, and I haven’t done that. But partly because I try not to invite, overly invite, you know, email. If someone really needs to get in touch with me, you know they can reach me on Twitter. Username, by the way, is just Adii. And if someone occupies me and says, “Adii, I need to email you”, I always give them my email address. But I try not to make it too easy, which is kind of a faulty mechanism for the rabid emails.
Andrew: OK. All right. All right. Well, guys, have gotten lots of different ways to contact Adii. You’ve got lots of different ways to contact me. I want your feedback. He wants your feedback. And more importantly, go use this somehow. Even if you just teach it to the world, I’m telling you, you’re going to get this inside. You’re going to start to internalize all that we’re saying here. All right, everyone. I’m Andrew Warner, and I’ll see you in the comments.
