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Here’s the program.
Andrew Warner: Hey everyone, my name is Andrew Warner. I’m the founder of Mixergy.com, home of the ambitious upstart. I had a little bit of an issue today. Today’s guest, the one who I had scheduled, wasn’t able to come. She had a family emergency. But I got an email from a viewer who said, “Check out this kid. You have to have him on Mixergy at some point in the future.” The article was about Christian Owens, a 16-year-old who earned his first million dollars within two years. So, a few minutes ago, I skyped Christian. I asked him if he would come on and help me out and do this interview. He said he’s a Mixergy viewer, and agreed to come on and do this interview and help me out. So Christian, thanks for doing the interview and welcome to Mixergy.
Christian Owens: Hi. Yeah, happy to do it.
Andrew Warner: So you started this business, and we’ll talk about what the business is in a moment, but you started the business when you were 14 years old?
Christian Owens: Yeah.
Andrew Warner: Wow. The business is called Mac Bundle Box. What is Mac Bundle Box?
Christian Owens: Uh, Mac Bundle Box is a software promotion company. We do deals with Mac software developers to offer their apps and their software in discount bundle promotions, as we call them, to the public. We might sell ten different applications that separately you’d buy for $500, and we’d sell them for $30.
Andrew: Wow. Now, this is very similar to a program that I’ve seen online before. I think it’s called MacHeist. Is that where you got the idea?
Christian: Yeah, kind of. I mean, I’ve been a Mac software developer before that, just developing little applications. I gathered some friends who are in the Mac development community and said, “What do you think about sites like MacHeist and things like that?” The general response that I got from the developers was they didn’t really think it was fair to the development community. The developers weren’t being properly compensated for the apps that they were putting in. So I decided that I’d make a MacHeist kind of business model, but make it fair for both myself and the developers of the applications.
Andrew: How’s yours more fair for the developers than MacHeist?
Christian: MacHeist don’t reveal a lot about what they do, like on commission and how much they’re giving to the developers. But from what we’re able to gather from talking to people who’ve been in them, MacHeist tends to pay the developers a lump sum of money to be in the bundle, whereas we pay them on a percentage basis of however much the bundle makes.
Andrew: I see. And what are some of the apps that you’ve had in the bundle?
Christian: We’ve just done one recently. We had things like Speed Download, YummySoup!, and 1Password. We’ve been able to work with hundreds of great Mac titles.
Andrew: I think 1Password alone is worth more than 30 bucks.
Christian: Oh, yeah. Most of the applications that we work with are worth more than however much we sell the bundle for. We just did one for $39, and one of the apps in there was worth $75.
Andrew: All right. Here’s my vision for this interview. I want to learn where the idea came from, how you launched the first version of it, how you got your customers, how you worked out the deals with developers, and basically how you built out Mac Bundle. Then later on in the interview, I want to talk to you about the second business that you launched, Branchr. But let’s give people a preview of what it is. What is Branchr?
Christian: Branchr’s a contextual, behavioral, and geographically targeted pay per click advertising service. We take publisher websites, who sign up with us, and match the advertisers to the publishers in a real-time basis.
Andrew: Okay. And I see someone in the audience. LatkeG is saying, “MacHeist raises money for charity.” And no one’s trying to bring down MacHeist or disagree with their business model. We’re just saying you saw a different approach to doing this.
Christian: Yeah, we donate a percentage of the Bundle to charity every time as well – 10 percent.
Andrew: Let’s go back. A couple of years ago you come up with this idea. What’s the first thing that you do?
Christian: I’m pretty much the kind of person who has an idea and then they want to do it straight-away. It was the kind of thing where I thought the idea, registered the domain name, put up a holding page with a sign-up for email updates, and wrote a press release and sent it out via a service called prMac. The reason that I kept pushing with the idea was actually the first press release we got 3,000 subscribers, 3,000 email subscribers in the first two days to our way of doing things.
After the initial influx of traffic and press and stuff, we worked from there, because obviously at this point we hadn’t done any deals with developers. We didn’t even know if it was going to work. Then we just started emailing developers, seeing if they were willing to be in a bundle, provide us with their applications, and they’d be taking this much commission from each sale by percentage.
Andrew: Let’s go a lot slower here, because people are asking for details, and I know I want to know more about the details.
Christian: Yeah, sure.
Andrew: MikeB in the audience is saying, “3,000 subscribers came into that landing page, put in their e-mail address and registered? 3,000 people just from a single press release?'”
Christian: Yeah. There’s a service called prMac.com. I know the guy now, after submitting every press release with him. He’s called Ray. Basically, he’s built a press release distribution service for Mac websites. He’s made an amazing community of people who are just willing to promote an idea if they think it’s good enough. You submit your press release, and he’ll help tweak it and edit it and make it the best it can be. Then it gets distributed to, I think, 2,000 media outlets. And then it just got picked up from there.
Andrew: Okay. And was this the first time that you submitted a press release for one of your ideas?
Christian: Yeah, I think it was the first time.
Andrew: Okay. So you just knew about this site. You said, “Let’s give it a shot,” and you promoted it how? What was it that was the draw in the press release? Why would people want to come out and see your site?
Christian: We just explained that we were going to provide, as MacHeist did, we obviously didn’t promote them through the press release, but we wanted to provide low-cost software, huge discounts, and we were going to do it fairly for the developers. It seemed to be the fact that it was going to be fair for the developers is what all the sites latched onto, especially the Mac development sites. They latched onto that, and then said, “Yeah, we’ll repost about this because we’re happy to support the development community.”
Andrew: I think I’ve done over 300 interviews with entrepreneurs, and what I’m seeing over and over again is the ones who’ve had their businesses work out would just toss up anything at first. It doesn’t have to look good. Very often I see in their faces that it’s ugly. It doesn’t have to have all the functionality. I interviewed the founder of Webs.com. He said he just put up a list of features, and he didn’t even have them for years after he put those up on the homepage. He just said, “We’re going to have these someday.”
Christian: Yeah.
Andrew: I see that’s what you did too. So I’m wondering, did you ever do this before for another idea? Create a landing page or create an idea, and nobody cared, and you weren’t that fascinated with it afterwards, and you moved on? Or is this the first time that you took a shot at anything?
Christian: It’s the first time I’ve taken a shot at anything with a landing page, or a period of time before that where we marketed the idea of doing something. Anything before that we’d done had been things like, “We’ve made this. We put it up, it’s for sale now. Go buy it.” Before this, we tried to build an interest or a following or a community around it, and that worked obviously really well.
Andrew: What else did you try selling in the past?
Christian: I have a Mac software company called The Dream Apps.
Andrew: Mm-hmm.
Christian: We built an app called Dream Capture. It’s a video recording app, and another one called Involer, which is our best seller, which is an invoicing application for small businesses. We didn’t really market it. We used Twitter and Facebook and things like that to market the products, but we never did the kind of “get people excited about the idea before it happens.” I think businesses lose out a lot if they decide that the first thing the consumer sees about the product is where they can buy the product.
Andrew: If the first thing they can see is where they can buy the product, then you lose customers?
Christian: Yeah. I think so. I think it’s much more healthy for a company or a brand, or it certainly was in our case, if you can develop a following, a bunch of people who’re interested in an idea, and then grow that base of people to start with and then try and sell your product to them.
Andrew: I see. Okay, I got you. Before we did this interview, I saw a comment by a guy named Riyadh [SP] in the chatroom, who was asking about your motivation. Now as I’m talking to you, I’m wondering about that too. Where’s this motivation coming from? Why would you, as a 14-year-old, launch this company? And as a pre-teen it sounds like, why would you launch all these other ideas?
Christian: Yeah. It wasn’t money. I mean, 14-year-olds don’t really have much use for money, or especially the amounts that we’re talking about. It was just the drive to do something and make something that other people could use and build something that would be in front of all these eyes. It was just something that really appealed to me. I followed Steve Jobs for a number of years and think he’s amazing, even despite the antenna problems and the way he handled that. Just following other entrepreneurs and seeing how they do things, I just really wanted to make something great that people could use and be happy to use.
Andrew: What is it about Steve Jobs that inspires you?
Christian: His ability to make a great product, one after another. It’s just the Steve Jobs’ mentality of it doesn’t just have to look good, it has to work good as well.
Andrew: Okay. All right. So you came up with this idea. You started to get a following of people who said, yeah, we’re interested enough that we’re going to give you our email address, and we’re waiting for you to actually put this together and maybe we’ll be customers. The next step was to go out and get developers who would give you the software that you would then sell in a package at a discounted price. How did you do that?
Christian: Pretty much all through email. We’d use thing like MacUpdate and all these websites that list Mac software and downloads. We’d go to the developer website and find their contact information or their support information. We’d just send them an e-mail telling them exactly what we’re doing. We were clear with them about how much money that they could make out of this, like the following that we’d gotten and the press we’d been receiving and stuff like that.
Andrew: Okay. What was the reception when you started sending this out? Was it a bunch of noes, and then you finally tweaked your email and got yeses? Or was it a quick yes? What was it like?
Christian: At the start, we started sending this, we obviously wrote a copy kind of thing that we were sending to everybody. It was three or four paragraphs long. It just detailed the percentage you might get, and how much following we’d got at the minute. And we got maybe one or two yeses from that. But it was when we tweaked that email and made it more personal for the developers and mentioned the application that we want to use and the kind of people who have already picked up on this and the apps that we got before, it’s only then that we started getting like every other email was a yes. We started having to turn people away.
Andrew: I see. So there was a stock email that you sent and you got some yeses from it, but it didn’t do that well. You took the yeses that you got from that and you created a second email that was customized. You referred to the ones who said yes, and you talked to the person who you’re emailing more personally. That’s what got you all those good yeses. The flood of yeses.
Christian: Yeah. The personal touch, like mentioning the developer that you are contacting, saying that you really like X feature about his app and think it would be appealing to the community. Once you personalize the email and personalize the way that you are talking to people, rather than just sending a copy of what thousands of other developers are getting, we just found that that led the developer to trust us more into building a great product.
Andrew: So Andrew SG and a couple of other people in the chatroom earlier were asking if there was any friction from adults. Did people even know, while you were sending these emails, that you were a teenager?
Christian: Not really. I mean, I didn’t mention it unless it was asked. I didn’t lie about it, but it wasn’t something that I mentioned unless I was asked. Once people had had an experience with the company and with what we were doing and figured out that we could be professional about it and I wasn’t just a kid who was online trying to scam people or whatever, once they figured out that we were being professional about all of this, then they were happy to work with me regardless of my age.
Andrew: What about the legal paperwork? A few people are asking about that.
Christian: In the beginning with Mac Bundle Box, we didn’t have anything, like there wasn’t a company. We didn’t set up a limited company over here or a LLC in the States or anything. It was only after that that we registered a company called The Dream Network, which we were going to use for all of the ideas and everything over here. We found a great accountant. We found great lawyers. People were just willing to help us because obviously a 14-year-old starting a business isn’t their usual client. So you have to kind of find people who are going to be respectful of that and not only that, they are just going to try and work with you rather than you be their client.
Andrew: So you’re saying that first you got the audience. Then you got the partners, the software vendors, and then you went out and you got the legal paperwork to work together with them.
Christian: No. In all of the time that we have done bundles, we do it now, but we have never had a contract with any of the software vendors.
Andrew: Oh really. It’s just by email. If we make this deal, would you join us? They say yes. You make the deal. They service it. You send the money. That’s it.
Christian: Yeah. We’ve never had a problem with receiving licenses. They’ve never had a problem getting paid. It’s just all been based on trust. I mean, a couple of the larger deals now, we obviously do sign contracts and non-disclosure agreements with them before it happens because we tend to take a very Apple secretive kind of thing to it before we do a promotion. But before maybe six months ago, we had never signed a contract with a developer or a vendor.
Andrew: Weren’t you worried that maybe they wouldn’t satisfy your customers or that there would be an issue or maybe they would demand more money? Was there any concern over that?
Christian: Not really. We just tried to make everything as clear as possible as to what they were getting and how much they would get per sale. We had no guarantee on what sales that they would get. We made it very clear from the beginning what their responsibilities were and what our responsibilities were.
Andrew: All right. I see a comment here in the chatroom by Dan Blank. He says, “What color is this guy in his world? This is one of those stories that seemed way too perfect.” Is this all as perfect as it sounds? Where are some of the issues?
Christian: The Mac Bundle Box story is pretty perfect. I mean, we started an idea with nothing. We spent like $100 buying a domain name and getting hosting, and it kind of just took off. The Dream Apps before that, we had little to no revenue at all. We built all of these applications. I put all of this time into building them and like not much has come from it. Before that, I did like web design – like get a client, build a website for them. It was just like standard stuff. Branchr was the first thing that didn’t go 100 percent to plan once we started.
Andrew: Okay. Let’s hold off on Branchr then till later. Let me check this out. First million within two years. That’s first million in sales, not profits. Right? That’s what the article was talking about.
Christian: Yeah.
Andrew: That’s one million in sales. What goes into the bottom line? What’s your net margin?
Christian: Quite a lot of that goes, because we are fair, to the developers. About 60 percent of that goes straight back to the developers.
Andrew: Okay. So you keep 40 percent – roughly $400,000.
Christian: Yeah. Then, of that $400,000, obviously after the first promotion, we started doing advertising for the deals, and we probably spend about five to seven percent of the money that we generate on advertising and marketing.
Andrew: Okay. So altogether, let’s say 10 percent in expenses after you pay out your developers. That means $40,000. That leaves you with $360,000 over the last two years in net profit.
Christian: Yeah.
Andrew: Well, congrat-freaking-lations I was going to say. Congratulations. Let’s keep going with the story. The design of the first site. Everything that has to do with Mac seems to need to look beautiful. Even little tiny apps that on Windows that look blocky and have that standard dialog box look to them, on the Mac they look so stunning you want to print them out and frame them. What did your first website look like? The one that was just a landing page getting email addresses.
Christian: The landing page getting email addresses was pretty horrible. It was basically like some text that said “Mac Bundle Box” and maybe not even 100 words about what we were, and then an email signup box. We hadn’t done any special design. It was all vanilla buttons. We didn’t even design a logo. We hadn’t even made images. It was just all text. I think we centered it on the page to make it look a little bit better.
Andrew: Oh, you centered it on the page. That was your design.
Christian: That was our design touch.
Andrew: People who are going to hear that are going to say, “That makes a lot of sense. That’s the way I should launch.” Then when it’s time to launch, they’ll say, “This doesn’t really represent me well or it doesn’t really communicate professionalism.” Then they will back off and they will wait until it is perfect. And by the time it’s perfect, it’ll be too late. So, I’m wondering how did you get past that when you were looking at that, a guy who now has incredible design, who loves a Mac, and so you love the design of the Mac and you admired Steve Jobs for his design eye. When you looked at that, how did you get past the design issues?
Christian: We had to get the balance between an amazing design, which is going to make “wow let’s just sign up anyway” and people who were going to look at the site, read the site, and sign up because they’re interested in the site, rather than, “Wow this has amazing good design. I want to see what they come out with.” So I think it was that balance that kind of made this so popular with such a poor design.
Andrew: Okay. What was the next version of the design like? This is just the email collection. What was the next thing that you launched?
Christian: So the next thing after the email collection was the very first sale that we did, which if I remember rightly, it was 15 applications for $49 with a retail value of about $550. By that time obviously, we had run the email signup for a couple of weeks while we had been organizing this getting developers, and we had time to put into a good design. We tried to design it as much towards the Mac as we could, because obviously that’s our target audience and people on the Mac clearly love the effort and the detail that goes into everything on the Mac. I mean, if you look at an icon on the Mac, it’s not just a block. If you zoom in, there is so much detail. We tried to reflect that, but my skill level wasn’t amazing. So I wasn’t really happy with it, but we launched anyway.
Andrew: So you were still designing the next version, and it was just a page that showed off the 15 apps that you had, that explained what they were, that explained the deal most importantly, and that let people buy.
Christian: Pretty much, yeah.
Andrew: Okay. What did you design it in? Was this a WordPress? Was this standard HTML?
Christian: No. I designed it in HTML, designed it in Photoshop, sliced it all, coded it in HTML, and then coded the payment and license delivery stuff in PHP.
Andrew: When you look at it now or think back on that first page now, what do you think?
Christian: We’ve come a long way. I mean from something that I could make now in 15 minutes to the deal pages that we have now, which take days and weeks to design and get absolutely perfect and the intricate detail on every button and word. I just think the added effort that we put in now really reflects what the company has become and like how much effort that we want to put into every bundle and how the design is important to us. It just reflects like what we are as a company.
Andrew: So this what a couple of people in the audience were saying, Dan Blank and Riyadh are saying that there is nothing about you that feels like a 16-year-old. How is it that you can be this articulate? Look at me now. I’m stammering and stuttering and having a hard time getting the words out, and I do these interviews every weekday. I know when I was 16 I wouldn’t be comfortable with some stranger calling me up on Skype and saying, “Jump on and do an interview with me.” Where does this come from?
Christian: I don’t know. To be honest, I don’t know. Over the last year, I’ve obviously got better with increased press and interviews and talking to people and become more confident with that. But before that, I would like to say I was pretty normal for my age. But I honestly don’t know where it comes from.
Andrew: The more you talk, the more comfortable you get. Is that what it is?
Christian: Yeah. I think that’s with anything. The more you do it, the better you get at it and the more comfortable you become with talking to people and the more it becomes routine and something that you are used to doing rather than something that is so foreign to you.
Andrew: When I graduated from school, I didn’t want to take a job while I was building my first company because I was worried that I wouldn’t have enough time to launch that business and give it the time that it needs to grow and so on. You’re doing this while you’re in school, while you have obligations to your parents, while you have obligations to do kid things after school. I don’t even know what you do – karate class, you skateboard. Do you do anything like that?
Christian: Play guitar, paintball, and stuff like that.
Andrew: So how do you fit in running a business while you’re doing that?
Christian: Sacrifice social life. That’s one thing. Just work every hour you have to spare. You’re not going to get somewhere or any success if you don’t put the work in. So I was coming home from school, working from like the minute I got in to the minute I went to bed. Working in the mornings, working weekends just to get this idea that I had. Work holidays. Work through the summer. Things like that.
Andrew: Do you do anything with the money to kind of impress your friends? In other words, I remember I had a business in high school and had a little bit of money. I had pizza delivered into school to impress my girlfriend in the cafeteria. I had a little bit of money. I was able to do stuff like that. Do you do stuff like that?
Christian: Not really, no.
Andrew: No. You might want to keep that in mind. That worked pretty well.
Christian: Yeah. That’s something I’ll have to remember next time.
Andrew: Let me know. Taking orders, how did you do that?
Christian: Excuse me?
Andrew: How did you take orders? You have people now coming into the website. You have the developers. You have the product that you’re going to sell them. You talked about how you designed it. You talked about how you got all that. What about the orders? How did you take orders?
Christian: I can’t remember what we did on the first one. We took orders via PayPal. We used the instant payment notification API to ping back our servers, and then sent out the licenses. It was all done in PHP.
Andrew: And the developers give you the ability to generate licenses yourself, or you have to ping them and they give it back to you?
Christian: We worked in three ways. We worked in one way where they’d give us a list of license codes, and then we’d just assign them to people when a sale was made. And then, at the end of the promotion we’d give the list back. We worked on another one where we’d have a URL. We’d ping that URL and that would send the license back, and then we’d send it out ourselves. And then, we had another one where we’d ping the URL, and they’d send it from their servers along to the customer.
Andrew: How automated was this?
Christian: Completely.
Andrew: It was completely automated. So, even if you’re pinging the URL or you’re drawing from a list, it’s all happening automatically for the user.
Christian: Yeah. They’d place their order, and within two minutes, they’d have all their licenses.
Andrew: Oh, wow. Okay, because I bought from a competing service, it wasn’t MacHeist, but I can’t remember who they were. And it took them a little while to send me the licenses. I kind of had the feeling that maybe they were emailing them and then forwarding me that email. You develop that yourself?
Christian: Yeah.
Andrew: Wow. How long did it take you to do all the development for that first version?
Christian: I was quite naive in the fact that I didn’t realize how much work it was going to be to compile all these emails, especially when the load started to go up and then it broke. But, it probably took about a week of the two weeks that we had of organizing the bundle. Probably a week of that was solid development.
Andrew: All right. I want to ask you about marketing, but first let’s talk about . . . Noah Kagan launched something called AppSumo. Basically, what he’s doing is . . . you know his website?
Christian: Yeah.
Andrew: He’s taking web apps. He’s bundling them the way that you are, and he’s selling them. I’m looking at his numbers because he also donates to charity, and he says publicly how much he’s donating to charity. They’re not that impressive. They’re not as impressive as your numbers. What do you think he could do differently?
Christian: Try the option with the community, try and sell to your previous customers, because it’s going to be much easier to convince a previous customer to make a sale than it is to find a new customer. When you do a bundle, don’t take any of the money, the profit from that bundle out of the company. Use all that for your next bundle.
Andrew: I see. To do what with, because it doesn’t look like it’s that expensive to do a bundle? What are you doing?
Christian: We bought ads.
Andrew: Okay.
Christian: That’s what we did. We bought lots of ads.
Andrew: What kind of ads work for you?
Christian: This kind of leads into Branchr, but we tried search advertising, so Google, the standard Google AdWords. We tried direct advertising, so banner ads on blogs and stuff, and we tried the AdWords banner ads service. And we spent a lot of money on that for not a lot of return. But if you do it right, we figured out, if you do it right with AdWords, you can get a lot of return from what you spend.
Andrew: What’s doing it right? What worked?
Christian: For us, what worked was be extremely specific, like you don’t have to target the masses to make a sale. If you target niche markets and you target very specifically to a person that you want to make a sale from, then you’re 10 times more likely to make a sale if three people click that ad than you are if like 200 people click the other ad.
Andrew: I see. What about an affiliate program? I saw that you have one of those. I think you pay out a buck fifty every time somebody sells one of these bundles. How did that do?
Christian: Yeah. Extremely well for us. We obviously made, I think we made, the last bundle we made 200 sales through our affiliate program. So, obviously, the use of an affiliate program both can lead to high earnings for the publisher who is displaying information about your service, but for us it’s the highest form of performance-based advertising that we’ve done.
Andrew: And what did you use to organize that, to make sure that people were getting the right accounting, that they were getting paid and so on?
Christian: We didn’t launch the affiliate program until quite recently. So, some of this stuff I’ve learned from running Branchr has gone into that affiliate program.
Andrew: Okay. So, how much did that first sale make, that first bundle that you described, with the 15 apps?
Christian: I think we made about $40,000.
Andrew: $40,000 in revenue from that. Okay. So, actually that seems in line with what Noah is doing with AppSumo. So, probably as he does more and more of these, he’ll keep building up his customer base and past customers will buy in the future. And he’ll reinvest whatever profits he gets into buying advertising, and that’s how it goes. It just snowballs and snowballs.
Christian: Yeah. It just keeps going. You just have to get a customer base who are a willing community behind you who are going to enjoy the things that you put out. As long as you put effort in, there’s going to be people who want to buy it.
Andrew: The second one, how much did that do?
Christian: I think the second one’s about . . . I’m going completely off numbers in my head right now. So, this might not add up at all. But, I think it was about $110,000.
Andrew: Oh, okay. All right. And so, what did you do differently the second time?
Christian: Nothing, nothing at all.
Andrew: What about unlocking? I see today where one of the more recent ones had an unlock where you were offering a certain number of apps as part of the package, but if more than a minimum number of orders came in, then you’d unlock another program for people. When did you come up with that, and how effective has it been?
Christian: Oh, we haven’t actually done that. We have never done an unlock model for our bundles. I know MacHeist has, and I know the MacUpdate promos have done that in the past. Until now, until the last couple of promotions, we’ve never been getting the volume of sales required for us to say, if we sell . . . we don’t have the consistency and the volume of sales to say, “If we sell over this amount, then we’ll unlock this app.”
Andrew: Gotcha. Okay. What about having a deadline, saying that these apps will only be available at this price for a certain amount of time? Do you have any sense of how effective that is?
Christian: I think it helps us too, because we do that for every bundle. We usually do between a week and about 18 days for a bundle. I think that just keeps people interested because if they’re able to go back to the site once and then go back to the site a month later and it’s the same deal there, it just doesn’t give them encouragement to purchase it now.
Andrew: Have you tested having different limits or different time limits, maybe, one three weeks, another two weeks, to see if that drives more people in?
Christian: Yeah. I mean, the first promotion we did was a month. So, it was the very first one. And I think we’ve got increasingly shorter the amount of time that we run the sales for since then. So, the second one, I think, was three weeks and then we just got shorter. The shortest one we’ve ever done was a week, and that was a Christmas bundle that we did. But, we think we’ve found the sweet spot, and it’s between 10 days and 2 weeks.
Andrew: I see. Let’s see what else I’ve got here. If you could go back to the first time you launched it and tell yourself, do this one thing. Do this one thing differently. What would it be?
Christian: Social impact.
Andrew: What would you do with it?
Christian: Things like leverage the power of Twitter and Facebook and Google Buzz and all these other services and StumbleUpon and Digg and everything. Just put a real emphasis on that, perhaps. We started doing it now, but perhaps reward customers and users for sharing the applications or sharing the bundle or tweeting about the bundle. Reward them for it. So, incentivize the sharing of the site via social.
Andrew: How would you do it?
Christian: This last bundle that we did, we offered an extra app for free if people connected their Facebook account and sent out a Facebook message.
Andrew: I see. Okay. And how many people did that?
Christian: I think it was 11,000 people.
Andrew: Oh, wow. And how many people on your mailing list?
Christian: Now, it’s just shy of 50,000.
Andrew: Shy of 50,000?
Christian: Yeah, 5-0.
Andrew: Wow. I do interviews all the time here, and entrepreneurs will give me their numbers. Some have even had their CPAs confirm their numbers with me by email. I am wondering, why is there so much openness. Why are entrepreneurs willing to reveal their numbers? Aren’t you afraid someone in your school might say, “Hey, if Christian can do it, I can do it,” and copy you.
Christian: I encourage competition. If there was no competition in this space, if MacHeist didn’t exist, if MacUpdate didn’t exist, what would encourage me to put out a great product each time? I mean, if there was no competition, then why would I need to put this much effort into design or put so much effort into marketing? If there wasn’t that competition, then I wouldn’t be doing that, and that would lead to a worse service from me.
I just prefer the way the company runs when you’re putting all this effort in. You’re putting the time into the design. You’re putting the time into the way the website feels and it loads and the speed it’s loading at. You never can tell.
Andrew: Can you measure the order increase? Can you see your orders increase when you get an article like the one that I read that said, “16-year-old earned his first million dollars?”
Christian: Yeah. We use things like Google Analytics and . . .
Andrew: And you see the increase as soon as the article hits?
Christian: Oh, yeah. We see spikes in sales. If we become a trending topic on Twitter or we get on the first page of Digg, we definitely see spikes in sales and the data that we can collect from where our website has been featured or if we’ve been on Digg or Twitter or anything like that. That’s how we learn, and we do our marketing in the future, based on the data that we collect from that.
Andrew: What did you collect? What did you learn from being on Digg?
Christian: So, from Digg we learned about what sites that we should encourage people to Digg. So obviously, when people visit, we get like a million visitors every time we do a bundle. So we, obviously, have this amazing power to say if we get a Gizmo article or a TechCrunch article about our bundle, we know that we should promote to the same million people who visit our website. We know that we should promote the Digg button for that article, rather than the Digg button for our site.
Andrew: Ah, gotcha. Okay, I see. What’s been the best source of traffic for you?
Christian: The Unofficial Apple Weblog.
Andrew: That’s a great blog.
Christian: That’s been the best one.
Andrew: It’s the first one I subscribed to when I got my Mac.
Christian: That and MacWorld.
Andrew: Okay. I don’t subscribe to that.
Christian: You should.
Andrew: All right. I’ll give that a shot. Have they been sending you a lot of orders? How does that compare to 2L?
Christian: It’s about the same. We didn’t get featured on MacWorld the first time, but in subsequent bundles they have provided a good amount of traffic.
Andrew: Who’s managing the business now, because we’re going to talk in a minute about Branchr, but I’m wondering who’s managing Mac Bundle Box.
Christian: Me. I still do it all.
Andrew: So, it’s still you reaching out to developers. It’s still you developing your own site and making sure that you’re pinging the developers and getting the license code and taking the orders and making sure that PayPal didn’t go down.
Christian: Yep.
Andrew: And you’re still using PayPal?
Christian: We experimented with a credit card processor on the last bundle we did, and it turned out that that is one thing that people wanted. Quite a lot of people don’t trust PayPal, big corporate company. So, we decided to just go with a credit card processor the last time as well as PayPal, give people the option.
Andrew: I see. Okay. And the website is MacBundleBox.com?
Christian: Yeah.
Andrew: Okay. All right. So, where did you get the idea for Branchr from?
Christian: So, Branchr kind of stemmed from Mac Bundle Box. So, with all the money that we spent on advertising, I think we spent probably like $50,000 in our first year on advertising for Mac Bundle Box. So, it was the lack of return that we were seeing on this advertising and the lack of our ability to target towards a specific person rather than a specific search term or a specific website that inspired me to start Branchr.
Andrew: Okay. And what was the vision for it? How were you going to make things different?
Christian: We wanted to make a service that allowed people to target ads to a person rather than a website. We knew services like this existed, but the kind of price range these services were after, it was large corporate companies that were able to use the large online source. So, we wanted to make it available to everyone, the way Google AdWords is. Anybody can go and sign up and place a search ad. We wanted to do the same thing for a behavioral target.
Andrew: So, give me a sense of who would want to use this, and who they would be targeting?
Christian: So, as an example of the kind of customers that we have at the minute, we have a lot of online stores that use us so they’re able to target to people. Say it’s a travel company who is selling holidays. They are able to target to people who are looking for a specific holiday or a specific flight or a specific hotel, who the person’s been looking for, rather than placing the ad on a website that’s about that.
Andrew: I see. So, it doesn’t matter where the user is. If they’re interested, if they’re the right user, they’ll get the ad.
Christian: Yeah.
Andrew: Didn’t this exist before?
Christian: It did exist before, but it wasn’t available for everybody to use. It wasn’t available for, like, you or I could just sign up, pay $20 into an account, and start using the behavioral target and technologies.
Andrew: I see. I didn’t realize that there was such a big barrier to entry. Who were the big players at the time?
Christian: Google offered the service. Yahoo offered the service. But, again, it was for sites that had to spend of over $4,000 a day. So, it was the kind of services that were out of reach for smaller online stores and people who are just starting their first business. But these technologies are so valuable in online advertising that someone needed to make a service that allowed anybody to use it.
Andrew: So, what was the first thing that you did after you came up with the idea for this business?
Christian: First thing, we made a prototype of a system. So, we started researching technologies and the way that we could do this because obviously in running any ad network you go through a huge amount of data. In a behavioral network, you have to save all data, because we have to learn from people’s browsing history and stuff like that. So, we had to figure out ways to save all that data and what was going to be the cheapest option for us in terms of service and database software and things like that.
Andrew: So, you built a database. And then, what was the next thing that you did?
Christian: We built a database, and then we actually built the thing that was going to serve the ads on the website, try and make it as fast as possible because obviously we did lots of calculations and algorithms and stuff that we have to run. And we want to try and keep this time that people are waiting for an ad to load on the page down to a minimum.
Andrew: Okay. How did you get the publishers?
Christian: We just started emailing sites, the same way that we got developers for Mac Bundle Box. We used that method to get our first load of sites for Branchr.
Andrew: What kind of sites tried you out at first?
Christian: We didn’t really target any big sites because we knew we couldn’t handle the traffic that they bring. So, we kind of targeted small, like, WordPress blogs and people on Blogger. So, sites that might be getting, maybe, 100 hits a day, we’d want to manage their advertising.
Andrew: And the advertisers, how did you get them?
Christian: The same way. We just emailed people and told them about our service and how we felt that we’d be able to bring higher returns on investment for the amount that they’d place with us. We offered things like double your deposit. So, if they put in 10, we’d give them 20.
Andrew: If they’d put in $10, you’d give them $20 worth of advertising in the system.
Christian: Yeah.
Andrew: Okay. And how many sites did you launch with?
Christian: We launched with about 50 sites that we were serving ads on and probably three or four advertisers.
Andrew: And 50 sites, was that enough, or are we still talking about just the first . . . is this is kind of the landing page that you had for Mac Bundle Box?
Christian: We did start with a landing page so people who were interested in the site and people who liked the idea of being able to use these behavioral targeting earn more from the site, or on the flip side have a higher return on their advertising. We did a site like that, but it was more like reach out to sites, reach out to advertisers to try and get these people to sign up with us.
Andrew: How did you know who was on the website? How did you know who the users were, for Branchr? So, the whole idea behind Branchr is to say, Andrew is a Mac user. He may not be on a Mac blog like the Unofficial Apple Blog, the Unofficial Apple Weblog, but wherever he is we should be serving him an ad about Apple. How did you know who I was?
Christian: So, basically, our system learns. So, all the websites, every time you visit a website with a Branchr ad on it, we collect information about you. We know that you’re . . . say that you visit a travel blog. We know that you visited a travel blog. And then, say you read an article on a tech site. We know what the article’s about. We use the contextual technologies that have been around in other ad networks like Google and these other sites that were allowing people to do cheap advertising.
We use these technologies to kind of build a profile around a person and what they’re browsing and the sites and network that they’re browsing. Once we have that profile, we can allow advertisers to target towards that profile.
Andrew: How long has the business been around?
Christian: We started in January of 2009.
Andrew: Okay. And I know you also are available on the iPhone and the Android. How’s that compared to the web?
Christian: We launched the iPhone and Android SDKs and the ability to advertise on them and publish ads for them, we launched that, maybe, two months ago.
Andrew: Okay.
Christian: We’re still new in that space, but it’s proven really well. I mean, mobile is definitely the way forward, so the iPad, the iPhone and the other devices that are out there. Mobile is the way forward, especially like hyper-targeting things like geographical location.
Andrew: So, someone in the audience, I don’t even remember who it was, was asking about Mark Bao. You partnered up with Mark Bao. Mark Bao’s another guy who’s a kid, who’s just launching companies. So, I kept reading about him on TechCrunch, reading about him in the papers. How did you hook up with him, and what’s the responsibility breakdown between the two of you?
Christian: Me and Mark partnered about a year ago on Branchr. So, it had been around for a few months, and Mark was starting another advertising company called Adaptance. And this was a similar thing to what we were doing, but it brought in a social aspect to advertising. So, it was targeting people who use social networks and share stuff online.
I had known him for about three years before that as well. But, it was about a year ago that we kind of put our brains together and said, “Why compete with each other when we can merge our two ideas and just make this company even more successful than it could be?” So, we got to work and developed a new version of the system, which we launched maybe half a year ago. It just leveraged more technology in the target, which made it smarter, faster, and easier to use.
Andrew: Is it a 50-50 breakdown in ownership?
Christian: It’s 55-45.
Andrew: Who’s the 55?
Christian: Me.
Andrew: Oh, wow. All right. So, what’s the deal with teenagers running businesses? We were talking about that, too, while we were waiting for you to get set up. We were talking about it in the chatroom, that I’m seeing more and more of it. Why?
Christian: Well, there’s a few reasons. I mean, it’s so easy to do. You don’t need extensive amounts of knowledge to set up a company, especially online. You don’t need money, hardly any money at all to start the business online, and as long as you put the effort in and I think, especially if the teenagers are putting in the effort about something that they’re passionate about, if they feel strongly about something, they’ll put the effort in.
Andrew: But I see adults who have the same access to technology, they have fewer barriers who are struggling even more to bring in revenue. Why?
Christian: You have to have a willingness to change. So, as the market changed, you have to change with it. So, there’s obviously a focus on social right now, and there’s a focus on geo location and geo location of social networks. So, if you’re willing to accept all these new things, regardless of what you think about them, and you’re willing to go with the trends that are happening, then you’re going to succeed because you’re going with what’s happening now, what’s popular now. If you adapt the business to that, then you’re going to be able to succeed then.
Andrew: I see, Okay. And I see LatkeG in the audience, help me pronounce your name, saying that we were brought up on technology, that’s true that you’ve had technology as long as you’ve lived. It’s just been a part of who you are. You’re more comfortable with it, and you’re saying, in addition to it, you’re willing to adjust. He’s saying, Latke. That’s the way to pronounce his name.
All right. So, what’s next?
Christian: I want to continue with what I’m doing at the minute, perhaps not the software promotion side of things as much. I want to focus on the advertising and growing that side of things into something incredible. Then, I mean I come with ideas all the time and end up just doing them and staying up to crazy hours in the morning and doing them.
Andrew: In addition to Mac Bundle Box and Branchr, you might have another idea at some point. You just go and you build it. You’ve had this happen to you.
Christian: About three weeks ago, I came up with an idea for like a One Riot kind of search engine, like, social search engine but specifically for Twitter trending topics. And I built that in like 48 hours. I don’t think I slept. I kind of get focused on something, and then I’ll just get an idea, and then I’ll just run with it.
Andrew: So, developers can do that. Non-developers have to go out and figure out who to hire, how to partner up. How did you become a developer?
Christian: I don’t know. I think I was about 12. I might have been 11. And I kind of went to my parents and said, “How do you make a website?” And they go, “Well, why would we know?” So, I just went online and learned about HTML and CSS and how to build a website. It just interested me how you can, especially with the Internet, how you can start with completely nothing and come out at the end of it with something by just putting in effort.
Like, if you were going to build a company to do with consumer electronics or something, there’s that side of it, but you also need the materials, and you have to buy all this stuff and you have to put it together. But with online, it’s just the putting together that you have to do. You just have to take the knowledge and the resources that are available, for the most part for free, and put it together.
Andrew: You hired your mother?
Christian: No.
Andrew: Oh, you didn’t?
Christian: That was a misprint.
Andrew: Okay. Who did you hire?
Christian: Mainly support staff and people like customer support. That’s really important to us, especially at Mac Bundle Box. So, people having customer support and keeping the customers happy.
Andrew: So, where do you find these people?
Christian: I’m not a fan of interviews and doing things like that, or like resumes and CVs for that matter. I don’t think that you can really display a person’s ability, especially with things like design and development. You can’t really display a person’s ability to do these things through a resume.
So, I tend to use things like Twitter and Facebook and sometimes our own site just to say, “We’ve got this position open, and we’re looking for these kinds of people. Just give us an example of what you do. If you’re good enough, we’ll hire you.”
Andrew: Oh, cool. All right. Well, it’s great to meet you. I see that there are a lot of people here in the audience who are loving this interview, who are wanting a way to follow up with you. Is there a way for them to say hello afterwards, or ask you questions if they’re teenagers who want to get into business, too, or adults who want to get into business?
Christian: Yeah. I’m on Twitter at The_Dream. I need to change that. It’s a horrible Twitter name.
Andrew: What is that Twitter name again for the transcribers to get it right?
Christian: It’s The, and underscore and then Dream.
Andrew: The_Dream. Okay.
Christian: Yeah.
Andrew: All right. Check out at The_Dream. Check out MacBundleBox.com. And Branchr is spelled B-R-A-N-C-H-R, no E, Branchr.com.
Christian: And ChristianOwens.com has links to all my profiles and social networks and everything. And you can contact me there if you have questions.
Andrew: And ChristianOwens.com. I see you’ve got one fan here in the audience who just keeps saying, “Andrew, please, ask him how can I say hello? How can I get in touch? I’ve got a question.” So, he’s really happy that I asked you that question.
Thanks for doing the interview, and really, thanks for coming in at the last minute like this. I really appreciate it.
Christian: Yeah. Thanks for having me.
Andrew: Cool.
Christian: It’s been a dream of mine to be on Mixergy.
Andrew: Rock on. And thank you all for watching. Bye.
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