Andrew: Hey there, freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy, where I interview entrepreneurs about how they built their businesses for an audience of entrepreneurs. Like today’s guest today’s guest is somebody who had listened to Mixergy interviews as he was building up his company.
And is back here to talk about how he did it. I asked him why he said, well, I got a lot out of the interviews myself, and I want to tell people, I want to tell other entrepreneurs my story, and hopefully they’ll get something out of it. And I know they will. And. Today’s guest founded software that you have no doubt used a bunch.
And maybe you didn’t know about the company behind it. And maybe didn’t know about the person behind the company. His name is George Deglin. He is the founder of one signal. If you’ve ever been on a website where you’ll see an alert that says, Hey, do you want to get alerts? When we update the site, when there are changes to what we do and you hit yes.
Accept. There’s a good chance that one signal was the company that powered that. Now I’ve known them always as the company that does these website, alerts these website, reengagement campaigns for free, but they go beyond that one signal makes it really easy for companies of all sizes to reengage users across.
All messaging channels. So it goes beyond that. In fact, the original inspiration wasn’t even, Chrome reminders, but iOS, iPhone, alerts and Android alerts, we’ll find out how he built this business by solving his own problem, his own pain, and then now helping so many other websites. Thanks to two phenomenal sponsors.
The first, if you’re building website, go to hostgator.com/mixergy. The second, when you’re ready to hire developers. Oh, I saw on your LinkedIn profile that you guys are still hiring. You should be checking out top tile, but I’ll talk to you and everyone else about them later on George, is there a company that you saw use one signal that made you feel like, yeah, this is, this is great that I get to create something that’s associated with that brand.
George: Oh, gosh, so many. I think the thing that really excited me early on was to see, game studios adopting a one signal. I don’t know if I can. You mentioned some of them, but yeah, that was certainly a highlight. I think another one was when HQ trivia was really, really popular. and I think I was hooked on it along with, seemed like half the people in the world.
, they were a customer of ours, so super excited to see that lead come in and,
Andrew: That’s a big one because with HQ trivia, You had to show up at the exact time that the game show started on your phone. And there would be be a million, 2 million people at the same time, all watching and competing against each other. And those alerts would have to fire without a delay. Right? If you just are five minutes late, forget it.
People are upset because they missed their chance to win the prize at that competition. how much revenue you guys doing?
George: we recently raised a series B, and I would say we’ve performed very, very well since then. So while I can’t say exactly where we got from a revenue standpoint,
Andrew: Can you give me a ballpark? Are we talking about the one to 5 million, five to even 15, any kind of range would give me a sense of how big you guys are.
George: yeah, the five to 15 is probably a closer range for us.
Andrew: Okay. All right. And you raised money? I saw from Justin Kahn. Am I right?
Y Combinator. Rakuten the famous, well, it sounds so famous. They want to be more well known in the U S even though a lot of us are interacting with their eCommerce software, they are the Japanese, Amazon, I think is the way that they’ve been described, but that’s not the best description.
It’s just the best way of communicating. I feel like though, your first big success and we’ll get into how you did this, but it feels like your first big success happened. Your first shot out of the gate with university. Am I right?
George: Yeah. If you can call it a bit of a success. I think one really exciting part of it. So university was the first company that I co founded. and I actually dropped out of school to start running that business. After we raised venture capital. so it was cool to be able to dive into the full time workforce being the founder of a venture backed startup, and, really an exciting journey.
lots of really positive times. Also some hard times we went through the, financial crisis with that company and survived it.
Andrew: started just before the financial crisis, 2007, right. You’re a guy who always wanted to be an entrepreneur, so that it wasn’t such a strange experience for you to have started. In the work world as a CEO
George: Yeah, absolutely. I was, I was itching.
Andrew: tell me, go back, let’s go back a little further. What was your childhood entrepreneurial experience like if you had any.
George: Yeah, definitely. so both my parents were engineers, so that really inspired my interest in computers and programming, and going even back a little further than that. my mom had been one of the first business owners, in Russia after, private individuals were allowed to start companies.
so she was very business minded, in a much more difficult business climate than, than we have here
Andrew: What was the business that you had
George: So it was that a consulting company, helps with, construction projects and a few other things like that.
Andrew: consulting company Okay. And then why’d she leave if she was already an entrepreneur there?
George: Yeah. I mean, mainly To make a better life here in the United States.
Andrew: Was there a family story that you guys tell about one difficult thing in, in Russia that made you guys want to leave?
George: I mean, there’s countless stories like, living in Russia at the time. you know, when we came over, , early 1990s was definitely like, not easy the country, like had a lot of things that made, Building a business or like, being successful, they’re getting good education, which is all very, very challenging.
and in contrast, I mean, I think it’s true. Yeah. United States, you can, you can come here and through like working hard and all of that, you can really build an amazing life for yourself. And I think that that is certainly proven true for us.
Andrew: I had a friend. I was just telling my kids about this on the hike. I tell them the stories while we hike. Get them to keep on going. And I told them about this friend who in elementary school, everyone thought was really weird until you stood up. And since we were talking about Russia, he said, I lived in Russia and I escaped.
And that’s why I have this accent that you guys all think is funny. And then he started talking about his experience there. He said, I used to call people names and the name that everyone called each other, if they were really. Like looking to be insulting was Jew. And he said, I didn’t know, until later on that we were Jewish because my parents were trying to shield me from it.
And I didn’t realize that my parents were really uptight because they had Mike’s in our house. And then we got to escape. And as he told his story in a way that was more childlike than I just expressed it, but also more pain than I could ever communicate. I think a lot of us just. Changed our opinion of him.
Completely. Do you guys have any of those types of stories? Obviously, not that bad, but was there any one incident that defined your experience there
George: Yeah. I mean, that’s a pretty familiar story to me.
so my family’s Jewish,
Andrew: you are, did you know that, did they know the dura Jewish was their persecution for being Jewish? Was it just like an insult the way some people will use to call people gay
George: there’s definitely like, religious oppression, in Russia. and yeah, it’s got that certainly in, in like early 1990s was, was more severe.
Andrew: What about the mix? Was there, were there Mike’s in your house too? Or was this
George: heard anything about that, but you know, to be honest, like we moved here. I was, I was like just four and a half. And I think my parents have shielded me from a lot of what they have to experience. so who knows, I’m sure that they went through some rough times.
Andrew: So coming to the land of entrepreneurship and business, what are some of the little businesses you had when you were growing up?
George: Oh, gosh, there were a lot of little things I was doing. I, I ran a server for like a passive multiplayer online game for awhile. and I had like admins that I like recruited volunteers
and things like that.
I ran a personal forum just for like my friends and myself, in ICANN up to a couple hundred members.
so that was, that was cool.
Andrew: How old were you when you started that first one? You know what it is? I know that it’s MMO, but I feel like such a fraud, even talking about it, having never played it, you know, and I’m always worried. Am I going to be called out for not being a game or not being in this?
how old were you when you did that?
George: I don’t remember exactly. I was probably like 14.
Andrew: Okay. Wow. All right. So not super unusual that you’d be able to get a group of friends together. Start this business. What was the catalyst for creating diversity when you were in school?
George: Yeah, I mean a big one. I was, I was just fascinated by education technology, itself. and it was through my own experiences, like the software that. students have to use every day tends to be pretty abysmal and quality. , and as a, as a student that knew how to code and build side projects and things like that, it was painful to use something every day.
That was. Yeah, it seemed like I could do so much better. Right. ultimately what led to me, to a founding university is I actually met my co founder who had an idea had already started to dabble in it, how good really Silicon Valley. and it was an opportunity to just like jump on to something that was, starting to get off the ground.
Andrew: And so the idea was to create a better version of what already existed in school.
George: Of sorts. Yeah. I mean, and tech itself as a space I was interested in. And then, and then, you know, my co founder had this vision, which was to build a social network for students. and, you know, the timing of this is, so Facebook had just started to become a big thing and also Facebook had just released the Facebook platform.
and so they’re in, and also Facebook was starting to switch away from being a very school focused social network to being just kind of focused on, on everyone in the world. And so. There was an interesting opportunity to build something on the case of the platform, which is what we did. and, brings students together.
You know, all of us were, were like in school or just out of school. so, we were very familiar with kind of what students were looking for,
Andrew: What was the first version? What’d it look like?
George: So it was very simple. You would, add the app. It was a Facebook app.
It was very, very, very integrated into Facebook. And you would pick the school that you, attended. it could be a high school or college. you put in all the courses that you were taking and then it would tell you who else was in those courses with you?
Andrew: Okay. That’s super simple.
Okay. And so did it was on you now to go and recruit students for this
at your school? I’m assuming first.
George: not really. I mean, we, there were a couple of places where we were able to get early adoption and one was just through the Facebook app, like listing. So there was, there’s a bit of organic architecture and then Facebook also provided tools to ask we’re able to use to get some viral spread. So when people would take actions, it would get shared in the newsfeed and then that would bring their classmates and friends onto it.
and so we were leveraging a lot of that for, for growth and quite successfully actually.
Andrew: One of the things that they would do is as soon as somebody added an app, they would say, here are all your friends select the ones that you want to tell about this app and bring them into the app.
And people would because of the flow end up telling all their friends.
George: Yeah, exactly. and actually in the very first version of Facebook platform, you didn’t even have to ask the user to select what friends they wanted to tell. You can actually just send API calls, without the user permission. And then all their friends are getting invited.
I think one of the interesting things about the Facebook topic at the time is nobody really knew what was possible.
And so. These sort of, you could certainly use that to drive insane amount of growth and kind of malicious ways. And some apps did that. in our case, we were trying to really like, be good at providing a good user experience. So we didn’t use any of these like super stretchy growth hacking techniques.
but I don’t, maybe, maybe we should have.
Andrew: There was a point where it felt like this was going to be the new platform. The way that windows had become a platform, the way that the browser became a platform for web apps, it seemed like Facebook was going to be the new app platform. You could almost imagine. People using word processing apps on top of Facebook, because why wouldn’t they they’d want to have their friends participate in some of the writing with them.
So I get Facebook’s motivation and I get the world that we were living in. What I, what I’m not sharing about what I’m not sure about is what was your business model for this? How are you planning on charging or was it going to be advertising?
George: Yeah. I mean, if, when we initially built it, it was just get as many users as possible. and then monetize. Yeah, probably through advertising, similar to how Facebook does, yeah, eventually, We saw that we weren’t getting seen the kind of growth that we wanted to. I think a big thing is like the user engagement.
I like the product just wasn’t that sticky. Like people kind of use it once and then like go do something else. and so we asked our adding social features to it. and then ultimately you realize that there was an opportunity to, to, be a B2B company and sell the product to universities.
It’s been a long time now. So I don’t remember precisely. I think we had always, looked at partnering with universities as a good growth channel. because once you have that partnership, you can use the university to drive adoption within their student body. And then I think through that, we said, okay, well for partnering with, and we’re giving them value, why don’t we charge for the product?
And then we’ll actually bring in revenue. and of course revenue became. Particularly important, in the financial crisis because you know, there wasn’t, there weren’t gonna be any sources of funding. We had to really start making some cash.
Andrew: I saw the press release about your eventual sale to a company called target X. They listed all the different things that you did. A university’s school’s app is a private online community institutions. Incoming class enrollment intelligent is a premium feature for schools app that uses real time social behavioral data to predict admitted students rank and probability to enroll you.
Chat is the only chat widget built mobile first prioritizing realtime student engagement. You are taking on a bunch. You basically ended up creating a social network for each school powered by and paid for by the school.
And that was you guys learning to reach out to the universities and bring them in.
And that wasn’t your part. As the chief technical officer, you were developing the product.
George: Yeah. My main focus was running the engineering team, finding interesting technical opportunities. Like, you know, we build something very much like the Facebook news feed with content ranking and things like that. Um, surfacing things like, people you were more likely to be friends with based on shared interests or activities.
Andrew: Ah, so the incoming student would know here are a few people I might want to get to know because they happen to have the same interest as I do. I was trying to, before we got started, understand what you took away from this experience. And it seems to me like one thing you are especially proud of is. You found a way to show universities that this would pay off for them financially.
Right? And by making that in his case, you were able to come in and make the use case for the end user. You’re able to bring them in. What was the business case that you made for universities?
George: the thing that universities care about is actually pretty similar to what other businesses care about. It’s about user acquisition, which is like student acquisition and user retention, which is like students
staying at the school and
Andrew: Don’t drop out and don’t stop paying.
George: and so the product, over time was, and you can see from some of the features was pitched as a solution to this.
It was. at the top of funnel, you would bring your admitted students onto it before they had even accepted their offer. And we would match them with student activities and clubs and tell them about the school. Um, and then also provide analytics to the university so that they actually could figure out which students to focus on, to convince them to join.
once we were on the platform and then you were attending university, we’ve helped them build social connections, which are actually one of the biggest indicators of whether or someone is likely to complete their degree or not. Whether they have the network of friends and, and support, throughout their time there.
Andrew: How did you know which students the university should focus on?
George: So it was ones that were most engaged in the platform oftentimes, or were not engaged. So, you could tell, okay. Maybe if someone is like on there every day has made a ton of friends, you’re all set. They’re going to probably accept the offer and join university,
George: They might even like specifically click a button in the product that says, yeah, like
Andrew: Got it. So the people who are gung ho about the university are the ones who are trying to make friends, the ones who’ve maybe signaled that they’re coming for sure. The university doesn’t need to spend time encouraging them. They’re already as encouraged as they can be.
George: And in contrast the ones that did enjoy the app or joined it, but haven’t had a high amount of activity or who had a lot of activity, but then haven’t engaged recently. Those are, prospective students that, an admissions counselor may want to reach out to
Andrew: That makes sense. Right. If there’s something that I want to buy, I might look at it, look at it and look at it. And then if I’m not that interested, I just stop. But the product creator. Yeah. I know that I stopped looking at it on Amazon. They can’t reach out to me here. You enable them to do that. How big did you get the business?
George: So I left about four years in and the company was acquired, I think three or four, not three years after I left. so I don’t know exactly how big they got. While I was there. It grew to about 30 people.
Andrew: They were here’s at least from the press release. university’s products have fostered over 3.9 million student connections, helping colleges provide more personal engaging student experience. Why did you leave?
George: so it was a couple of things. I think a big one was that I was ready to do something new and to take on a new challenge where a lot of my technical interests would contribute and the company had reached a stage where. Like we were continuing to build things. but it didn’t feel like there was something where like my experience would be able to like, add all that much more to the business.
and yeah, looking to do something new, something a little bit more technical was also kind of something that, that was important to me.
Andrew: So let’s be open. Is it because also you vested, you had as many shares you’re going to get, yes. You could get a little bit more, but that’s like a job. You couldn’t influence the direction of the company. So it’s not like you had the CEO role and find ways to double and triple the company.
George: Yeah, it actually wasn’t really time to vesting. Like I was, I was pretty satisfied non-equity and, you know, have big ownership in the company. I think it did come down to, not feeling like there was much like I can do to really influence them. and I was, I was happy with the direction that my cofounders are taking the company.
but I wanted something where
Andrew: How’d you do financially from that deal?
George: It was a small exit. the company like hadn’t raised several rounds of funding. the growth rate was good, but it wasn’t like world-class. So in the end, fortunately like made back a little bit, but cause like new car money, not new house money, I
Andrew: Okay. How’d you decide that you were going to get into games next.
George: Oh gosh. So the story there, like took a lot of different terms. I had been in like, just looking for something new to do. I looked at cybersecurity as a space that wasn’t, I was really interested in. and then, I was very interested in consumer products in part, because we had been building with B2B product that was kind of growing moderately on this social network, Facebook that was consumer centric and just grew explosively.
So I really wanted to experience some of that. and so when I met my co founder, he had a lot of experience in the consumer space. and we worked on a variety of ideas. Before, ultimately set up settling on James,
Andrew: partially it’s because you like the idea of having a lot of people know what you’re, what you’re creating.
George: yeah, I mean, I think that’s something that’s always been really exciting for me is knowing that I’ve had a hand in building something that’s being used or played by, by people all over the world. the games are an amazing
Andrew: Let me take a moment. Talk about my first sponsor. You know what I told you, I was going to tell you that you need to hire developers from them. I’m not going to push you to go hire developers. I’m actually going to give you something different that you could do a top town. It might’ve been reading in the news that a lot of these big companies have gotten really smart about getting government money.
Right? That they understand that we’re heading into for non a recession and depression yet we’re heading into a really brutal financial situation. And so I don’t begrudge them. And the fact that they understand and how, how the rules are made. Yeah. They understand how they should be operating to maximize the benefit for themselves, for their shareholders and their employees under the, the, the rules.
I just don’t want to be somebody who sits back and says, Oh, they’ve got all the smart people. We don’t have access to them. They’re going to win. We can’t, we can’t compete against them. One of the things that I did and I’ve talked about this before is a few years ago, I went to top talent. I said, do you have a business consultant?
And they introduced me to somebody who used to work at McKinsey and a lot of major organizations like that. And I said, sure, Here he is. Your Jack interview of Jack was one of five people that I interviewed. I really clicked with Jack. I started working with him as somebody who would give me insight into how I could fix my profits.
We were making so much revenue because then you can hear my interviews. I’m obsessed with revenue, but profits weren’t jumping. At times it was getting really dangerous. There we were, we were losing money for some months. What’s going on here. And Jack and I went through and we figured out all the little places where I was being wasteful or not thinking as, as strongly as I could.
One of the things that I discovered was Jack was helping the people we’re writing all of the, all the rules post COVID. It wasn’t that I hired him for that. It’s just that people who are smart, like him just get invited into the room by senators. And he’s given me insight into who he’s talking to show me the notes from conversations.
And I understand, and I basically think. Great. I’m not going to get the details, but Jack, you are. And so I’ve gone to him and I said, what can I do? here’s how the law is written. Here’s how the rules are written. He started explaining it to, he started explaining to me, and if I had any questions, if I didn’t know how to maximize the, My ability to, this is probably not the best way to say what I’m saying.
I want to take advantage of as much as I can because in the right way, because I don’t know how bad this environment is going to be in. So I reached out to Jack and he was able to help me out tremendously over the last six months as the economy got worse and worse. All that to say, if you’re out there listening to me and you need somebody to give you some business advice, I’m not talking about like the guru self-help business advice.
I’m talking about somebody who’s been at McKinsey, who’s been in organizations and been the person to get the unfair advantage for those org. For those bigger organizations. If you need it for yourself, go to top Cal they’ll help you hire somebody to do that. Help you hire somebody to help you raise money, help you put together.
Spreadsheets, presentations, all the stuff that we consider, these MBA types. Good for her, but we may not have them on staff. I could hire them part time, full time, project wise, whatever you need from top tile, all you have to do is go to top isn’t top of your head tells and talent that’s top talent.com/mixergy.
And when you go to that URL, you’ll see they’ve got an exclusive offer. They’ll give you plenty of time and a lot of confidence in why you should be hiring from them. All you have to do is go to dot com slash M I N E R G Y. Top tile.com/mixergy. All right. You launched it? Yeah, the company was called hip tick.
George: Oh, I don’t even remember actually. I think we just looked down a list of names and that was not a good.
Andrew: There was a good.com available for it. So you got hip tick.com and you created games. And one of the games that you created was a go Ninja. What was going Ninja?
George: Yeah, go Ninja was, you know, it started as an experiment, and a test for ourselves of whether we could build a fun game in a, in a very short period of time. in the game a was a two D side scroller. Where you were a Ninja, and kind of running through buildings and jumping up and down, rooftops and things like that.
And, and slashing all the mutans zombies that stood in your way. it’s actually kind of a play on fruit Ninja it’s fruit Ninja sports video game, where you’re like, our opinion was that ninjas don’t don’t slice fruit and like.
Andrew: Did you get what you were hoping for? GC friends use this and play this game. Did you get to experience that
George: Oh, yeah.
Andrew: did had, you know,
was a huge hit beyond the numbers? What did you see?
George: just people’s response to it. the game, we built it very quickly. we got the first version released in a month, which was a challenge. The game was very visually polished. we had some pretty complex game mechanics. but yeah, Apple featured it right away. so the editors definitely saw that the game was, was going to be, was going to be popular.
and then, we saw that the game actually had a pretty high viral coefficient. So people that would download it were quite likely to tell their friends about it. So even though we never spent money on marketing or ads, millions of people who went down at the game
Andrew: And so if you could create that, why, why did you struggle to get alerts, to get notifications on people’s phones?
George: Yeah. The interesting thing is, there were all these tools that we had been using to build, go Ninja and some are leader games. so lots of good tools out there for building the game, designing it, doing all the artwork, lots of resources for, sound effects and music. and also lots of things when it came to monetization of many ad networks, and places to run ads, if we needed to do that.
Andrew: So you’re not putting, I always imagine when you’re creating a game, at least back then that you were creating everything from scratch. Maybe you’re getting sound effects, but I thought does designing all the artwork yourself. And you’re saying, no, Andrew, we didn’t need to do all that. You could pick up some Lego pieces, some, some aspects of the game, like Lego pieces and put them together.
George: Well, sure. I mean, like we did do the sound effects ourselves, but of course there’s great software to help us do that. And we use the game engine at the top for that game. We use the game mentioned, it’s kind of funny that the name now, but it’s called a Corona STJ
they actually they’ve they’ve since renamed it, which is a smart, but, it made, it made a lot of easy, right.
We can just kind of load the sound effects in and it would handle them. Well, it could handle different formats.
Andrew: It’s called solar, right. Solar 2d, I think.
so yeah, I mean, it was, it was a great, it definitely sped up the process of the process of creating the game. and it also was cross platform, so we didn’t have to build it for iOS and Android.
We just had
Andrew: Okay. All right. And so you built it, but there was nothing, there was no way to create notifications
unless you did it yourself.
George: Yeah, basically. there were some vendors out there that would help. So I think one of the early companies to be in this market was urban Airship. if it’s reading themselves to just Airship, and they were, they were kind of a go to in the early days for most developers. but they had moved to be a very enterprise centric company.
And so the pricing was just completely out of reach for us. and in fact, I don’t think they even had a, an SDK for Corona nor anything that would make it easy to integrate in use. and so this was, this was true for, you know, that was the first game, but we built several after that. and it’s just kept being a problem.
It just like, how do we just send notifications? Like it’s free, technically free, like people have given us permission as on notifications, it’s very effective yet. Somehow there’s neither a suitable open source tool nor suit owner and affordable and good commercial tools to do this. and yeah,
Andrew: So you decided we’re going to go and create this ourselves. Was it going to be a project for yourselves or something that you thought other
George: Yeah, it’s a very early version of it. It was just like, we need to build things for ourselves. Let’s see what open source things we can, we can build on top of, but very quickly as we talk to other developers, other game developers and small businesses, we realized that this was actually a pretty promising business opportunity.
Andrew: And by other developers, you mean your friends, right? Who are creating this? Or was there something more formal than that?
Okay. So you’re reaching out. You’re seeing that this is an opportunity, but still now you’re going to get pulled back into B2B. Why is
George: Yeah. Well, B2B was, there were a couple of things that made it, still pretty exciting, but the first is that we intentionally want to take the approach of not building a product that would just focus on a small number of enterprise clients. When we looked at this, this is something that every single day that offer in the world, will want to use.
And so while it’s sure it’s other businesses, the impact that it has and the number of people using it, would be, you know, as now, you know, effectively each consumer scale. the other one is that, it really appeals my own passions as a developer and
Andrew: Plus when you’re talking about developers, it’s, it’s almost like consumers. You could be really proud to see that your favorite developers using your push notification. You could start to see the tech community that you love, that you’re a part of use it and get excited about it and feel that sense of pride that you get from watching strangers play your game.
George: Yeah. Yeah, absolutely. yeah, and then it was actually really fun to have early supportive conversations with people trying out the product because it, yeah, it was just like talking to a. To, someone like myself, who is really like having how much better are experienced as a result of finding our solution.
Andrew: You know, I remember around the time that you started, there was a company called that failed. They want to do the same thing as you did. And I interviewed the founder around the time that you started about why the company failed. And I don’t remember the details of it. Why do you think that that company failed?
Why do you think that this didn’t exist before.
George: Yeah. So there’s a lot of reasons why doing this is really hard. and actually one of the things that has been interesting in our spaces, if you look at the competitive landscape, the vast majority of the companies providing products like ours are very, very enterprise centric. and actually one of the biggest reasons for that is that providing this technology is hard.
Like. The technical hurdles that you have to cross are very difficult. The difficulty of setting up and being successful with a product like this can be quite difficult. And I think most people believe that if you build this for everyone, that like, they just won’t be able to figure it out where you’ll have to provide them too much support or it’ll cost too much to provide it.
and so I think a lot of companies have like either realize that and moved, or they haven’t realized that and like add a lot of trouble and it failed as a result, but we, we found a way to really nail it. Like there’s a couple of things that we’ve done differently in our business that have helps us scale as a broad Yeah, so a few things. one is, being fanatical about keeping our infrastructure costs low. So we’re a freemium product that provides a piece of infrastructure to our customers, which means we have to make sure to provide that in a way that’s affordable to us. So we can not provide, we provide to almost a million developers now for free, as an example, we host everything on bare metal to that, improves our margin.
We are very careful about how he builds stuff. So it doesn’t use too much computation or storage.
Andrew: Can you give me an example of something you do to keep your costs low.
George: I mean the bare metal part is a big part of it. So a lot of people will build on AWS and I’ll use a lot of the AWS managed services, which make it really easy to build, powerful features.
But you pay a fortune for them. So if you’re using Amazon’s hosted database or, a lot of the tools that they offer your hosting costs are going to be much, much higher than if you, essentially run it yourself.
Okay. Yeah. So bare metal means I’m a server. That’s not running a virtualization layer and it’s also not, it doesn’t have any other companies using it.
It’s a lot of times when you spin up an Amazon server, that’s a piece of hardware that is being used by four or five companies, depending on the size of the server that you provision, with bare metal. It’s just like having a computer in your room or in your closet, you have complete control over it.
You’re the only tenant on it. there’s no virtualization layer, which means you get even higher performance. and then the other thing that we’ve done, and kind of tied to that is we actually have control over the hardware that we get. So we customize the hardware, that’s put into our servers so that we’re not paying for things we don’t use.
And we are optimizing our costs for the specific hardware
Andrew: I guess I would have thought that it would be more expensive to do that because you have to run so much more of yourself.
George: It does create additional overhead because you’re having to, there’s certain services that you have to run yourself instead of just using a managed service. it can also introduce like a little bit of an operations burden. Like you have to have engineers that are experienced at running systems like this and that that’s more rare skill these days.
But when you’re operating at scale and infrastructure costs are focused, this is, this is definitely a very efficient way to do it.
Andrew: with a pen.
George: Let me put that away.
Andrew: clicking. What are you so many entrepreneurs who do that? I do that all day long is you’re sitting there. You’re kind of clicking over for me. It’s there are a few different things that I use. Sometimes I’ll spend the iPad pencil. I feel like almost it’s there just to give me something to play with. struggle with it.
No. The thing that I wonder, George, as we talk about, this is Apple makes so many things so easy. Why aren’t they making notifications so easy? Why is it such a difficult aspect of so many businesses world?
George: Well, there’s a couple of things. you know, the hub. It’s Apple makes it surprisingly hard to, to be honest, like the protocol in order to send user a message is quite complicated. You actually have to make a separate HTTP API call for every user that you want to send a message to like, like we haven’t gone into that.
You have millions of users. That means you need to make millions of API calls building. That is pretty annoying. If most of the time you’re building, you just want to build your game instead. but then, that’s just, you know, sort of the base layer of it. but on top of that, you actually want to do more than send notifications.
Do you want to send them to a relevant audience or do you want to translate them into each user’s local language? Or do you want to schedule it at the right point of time
And so you’re not just building something and looking at petitions, you’re building a marketing platform. and that’s, that’s not something that Apple ever really cares to do.
Andrew: That makes sense. Right. I might want a notification during the day, but not at seven in the morning. And you’re analyzing, were you thinking even back then, how do we analyze each user’s experience when they happen to be on the game? What time zone they’re in? You want to do all that?
Got it. Let me talk about my second sponsor and then get back into what, what the reaction was, how you’re going to make money.
And then how you went beyond these iOS notifications. Was it iOS and Android from, from the very beginning
first two. All right. So my first step, my second sponsor is company called HostGator. I should tell everyone was listening to me. If you like the idea of notifications that bring people back into apps, I should understand the one signal also enables you to do that on the browser.
Do you have an example of a company that’s done that really well with WordPress. WordPress is one of the things that HostGator is especially good at.
What’s an example of something
George: Let’s see if I can think of a word, press one. I’m not sure if this is a WordPress site, but you know, an example would be, our client business insider, sends
Andrew: Yeah. Every time that it could be, anytime they have a post or anytime they have a really good post. And could they do if then analysis also using one signal. So instead of sending it to everybody, as soon as the poster, it is published, send it to people based on something.
George: Yeah, absolutely. Or actually sometimes what we’ll see people do is they’ll publish two articles and now AB tests, which one gets more clicks and then they’ll send notification for the
Andrew: And they’ll do it within one signal too. They’ll take a small batch of people, send them a notification based on the headline, see what people click on. And then if then they have a winner and they change the headline. And then everybody gets the notification with a winning headline and all the future web browsers,
George: Yeah, exactly. Yeah. So we have some support for multivariate testing.
Andrew: One of the reasons why I knew you guys were super effective was I happened to go down a rabbit hole of conversations with direct marketers, online marketers, and they were talking about how they were telling all their people to go and sign up for one signal because it’s free because it just works because it brings people right back because you guys don’t stuff, all kinds of nonsense in the alerts.
It’s not like nine alerts for Andrew site. And then the 10th alert is for your sponsor. Right? You guys don’t do that.
So it just works really well. All right. And where was it? I was even on there. I’m on wordpress.org. There’s a one click install of your plugin that has high ratings. It looks like over a hundred thousand active installations where where’s the rating, strong ratings.
People love it. And it makes it real easy to install this on any WordPress website. That means that even if there is the browser, even have to be open for one signal alert to come up.
George: in most cases, well, it depends. One of the big places where our user on Android devices. So you can visit a website on your Android device and get notifications without having to install an app. And the browser does not have to be open. most of the time on a, on desktop. the browser has to be open, but you don’t have to be on that website.
So you could be doing something else,
then you get a notification, says there’s a new post or a new offer or a new discount. Right. Hit the link. Boom, go over. Listen to me. If you’re out there and you haven’t created a website yet. WordPress is an easy way to get started. All you have to do is go to hostgator.com/mixergy, and you can get that started with WordPress and yes, they have lots of other platforms you can use, but WordPress super easy.
And I like how portable it is. If you’re not happy with this hosting company, I think you will be. You can pick up and move, but with HostGator you get super low price, dependable service that will scale up with you. We switched to HostGator a while back and nobody noticed the site’s not down. We’re not dealing with any headaches.
It just freaking works. So go to hostgator.com/mixer. Do you get started today? If you’re not happy with your hosting company, switch to HostGator, save yourself some money and understand that they have the cheapest price available on hostgator.com/mixergy. But as your needs develop, and you decide that you want right more than what they have on there, they will scale with you.
They have things like managed WordPress hosting. I’ll give you a dedicated server, all that stuff also at a really low price, because thankfully they’re a leader in this. They’ve got so many resources to bring in that they could reduce their costs. Alright, hostgator.com/mixergy, super low price. If you use that slash Mixergy great service, that will just work.
And if it ever doesn’t work for you, I’m email@example.com. Let me know. And I’m at two Oh one mission street in San Francisco. Let me know. I always want to make sure that I bring good sponsors who will especially take good care of my audience, hostgator.com/mixergy. All right. How did, how were you planning on making money if you were offering this for free?
George: Well, actually, when we first released it, the business model was to continue giving it out for free, into monetize, similar to an ad network. once we had enough, market reach,
Andrew: Meaning that it would be that thing that I suggested earlier where it might be something like nine, nine links back to the site owner who, who got the installation. And then the 10
George: No, not exactly.
one of the things, yeah, one of the things we had looked at as an example was a company. you may remember them. It was called flurry analytics. and what flurry analytics had done is they provided a free analytics tool and they use the data they got from the analytics that all these publishers were, we’re providing them that user to create a more personalized ad network.
and so that was actually the model that we went with, initially as well.
Andrew: Oh, so you would have your own ad network completely different from these alerts to ads, wouldn’t show up in the alerts that you served up. It would just be, we understand the audience better. We understand where you should go. Got it. Wow. Why did you decide to do that? Instead of going freemium?
George: Uh, you know, I think coming from the mindset of developers, we really, really liked free products. I’m new to just developers love free stuff. and the prospect of being able to do that, to offer such a powerful product for free, and to, you know, both be able to provide notifications to help people increase retention, but also then to be able to provide a really good monetization mechanism, felt like, like a win for everyone involved.
Andrew: Yeah. And you had so many features already built into the first version and no advertising. Did you ever get into the advertising part of it?
George: In a sense. Yes. So, yeah, while we never built an ad network, we did work with advertising partners who were licensed things on the data that we were generating
Andrew: Hmm, you had AB tests for messaging. You had real time tracking. You had segmentation targeting. This is in the first or early versions, right?
George: early versions. Yeah. it was just the stuff that we wished we had had ourselves,
Andrew: Totally building for yourself the way that the base camp people keep preaching. Don’t try to do market research. Just
George: Well, yeah, I mean, that, that really helped early on. but actually, the next kind of thing that happened because the very first version was just built on our own intuition. but then we became very, very customer driven. So we had, you know, live chat on our website with our customers. And as soon as we got a request that was reasonable, we would put that to the top of our priority list, build it and try and convince that customer to integrate the product.
Andrew: I think because I’m not a mobile app developer, I always knew you guys had. The browser alerts
George: Yeah. So when push was a really fortunate channel for us, it was something that had gotten announced very soon after we released the mobile version of our product. and we knew that it would be both a really big channel because nobody had been using this before. And a lot of traffic still goes to websites.
Whether that’s on desktop or on a mobile device is also channel that nobody else had built for yet. So it was not like a Greenfield opportunity to support this, this amazingly popular new channel. And a lot of what we had already built, carried over to it because desktop notifications, what push notifications are, are actually very similar to mobile and a lot of ways.
and yeah, that, that led us to doing it very quickly.
Andrew: How did you get more customers beyond the first friends who knew you or more users? How did you get them?
George: so a couple of things, word of mouth has actually been one of the largest drivers that we have. People just love telling, like, as soon as they integrate our plugin, I think they really like telling their friends about the experience and the value that we provide, especially while I was free. I think that builds a lot of really Goodwill and curiosity about the product.
The other big channel for us, especially these days is the quality of our documentation. so many people have questions around how to amend notifications or how to use them better. And they’re always landing on our docs because we’ve spent so much time
Andrew: I’m noticing that that’s a huge reason why developers integrate software. If the, if the documentation is good, they’re more likely to work with it.
Did you also get one signal like branding on the alerts?
George: We actually have decided never to do that. so one of the things that you can do when you’re prompting for a web notifications is you can put branding on them in a lot of, other like smaller vendors in the space do that. our thought is even that for free clients, it’s a pretty bad user experience to put our branding on their website.
Andrew: Really? Did you do anything else to court developers?
George: basically. What I covered, documentation, documentation obviously ties into SEO, so that, that helps us.
Andrew: Wow. And no, no push with developers, no organizing events, no educational
George: Yeah, we do webinars now. actually I’d say the webinars are most helpful for like existing customers or those like, like evaluating the products more than they are like bringing in someone who’s never heard about us. we haven’t done events yet. It’s something that we’d like to do. you know, either virtually or maybe in person after COVID.
but, there’s just too many other things to do for now.
Andrew: Yeah, good luck with that. It feels like there’s, there’s not enough of an upside for doing it now. Right. what about on the other side, how did you end up getting, the, one of the things that you do is you aggregate data right on usage
George: Well, not anymore. that was, our business model when we started the company and in the first couple of years, but no, actually, about, 18 months ago or so we, we switched to being just a SAS business. We stopped, sharing any data with any of our customers on that side.
Andrew: Wow. So I guess it was a couple of years ago, I, I sent an email in and I got a response. And then you responded afterwards. You said, Andrew, I recognize the domain. I recognize you. You said a lot of really nice things. And then you said, I’ll be open with you. We do aggregate our data and sell it. And then I followed up and said, what about individual data?
You said, I’ll be open with you. We don’t. Do that now, but we have the right, we do within our terms of service. We might at some point in the future and I just respected the hell out of that response. and then you’re saying you didn’t do any of it or you don’t do any of it. You never did any, targeting based on my individual side or selling my individual data.
And you don’t do any aggregation sales either.
George: Yeah, not anymore. and we never did it for web push. It was something that we had experimented with. but, ultimately like never, never did on that side. we did work with some of the partners on the mobile side, but
Andrew: So now it’s all freemium, a lot of people using it for free. Some of them paying for the enterprise version
George: it’s been really interesting, actually. We weren’t sure what to expect. But very quickly, two big things happen. The first is that on the number of nodes vacations that our customers are sending per day, all added together, went up about 25%. and it’s actually stayed about that level has dropped down a little bit, but, it’s now much higher than it was before the other is, For the first couple of weeks of COVID in particular, the number of people sign up for one signal.
We now have about 25 or 30% as well. So the number of just top of funnel, people having one signal and setting it up, grew a ton.
Andrew: I noticed that from my interviews, that a lot of entrepreneurs were seeing that. If they were catering to two website owners, they were getting more usage because people were stuck at home. They weren’t sure about their futures. They decided that if this was a side gig, they better start taking care of their side gig website and improving it and they had time to do it.
So they were focused on it. Is that still true or are you seeing that the numbers went back to pre COVID levels?
George: The numbers are down a little bit from there still much higher than
Andrew: Because still a lot of people are at home. Still. A lot of people have time now to fix their online businesses. Is that it?
George: I think that’s part of it. I think the other thing is, so one interesting part about our platform is, we’re not just us centric. Like I think like at the start of COVID all countries were very highly impacted and now I think it’s more, just a smaller number of countries, yeah, across the globe, even in countries that have sentenced slunk ended sort of locked down or, or most restrictions.
we continue to see like high adoption and high usage. So I actually think that there has been a shift in people’s mindset and knowledge to be more focused on promoting their business online.
Andrew: You know, Scott Galloway said everything that we thought was going to happen over 10 years to online businesses just it’s going to happen, but it’s going to be compressed now to one year. And so we always knew retail was going to be dead. Or suffer dramatically. It’s just all happening now, 10 years worth of suffering dramatically happening in one, which is way more dramatic.
And so that’s, what’s happening. People are much more willing to buy groceries on. I always thought everyone bought groceries online. Why don’t you go into store? It turns out a lot of people, most people by far, I go into stores and now they’re willing to consider online and same thing for a lot of online businesses.
That makes a lot of sense. yeah, you look at this, your pricing is completely different when you guys switched. Did you imagining you, you made more money when you decided to switch to freemium that than you did before when you were selling data, right?
George: Yeah. Yeah, both. we grew revenues quite quickly when I made the switch, and actually a lot faster than we even expected. we thought that a lot of our users would just say, it’s not free. I’m not gonna use it. but, in fact, there wasn’t like that at all. very few users were upset, many of them, more enthusiastic.
a lot of them, converted to being some of our biggest customers today.
Andrew: Why they, they weren’t seeing any problems with, with the free version, right? It’s not like you were selling their individual data. What did they care for? They’re selling aggregate data. They didn’t seem to care. Right? They were using you. Why were they suddenly happy to pay you?
George: No, I think it’s a few things. I think there were definitely customers that cared, or where it was just a question Mark in their mind. Maybe they didn’t really understand it. Like, do I need to worry about this? I think another part of it is, they wanted to know that we were a business that was going to have a business model.
They understood, and we’ll be able to support them for a long time. And while our free model was working in many ways from that standpoint, I think people didn’t necessarily believe it. and so they didn’t necessarily trust, the longevity of our business, with that model.
Andrew: Yeah, that make sense. I’m looking at the email. I thought we just exchange exchange emails two years ago. This was four years ago. The we’ve sent emails almost exactly four years ago. And that was my hesitation at the time. I wasn’t worried about you selling my personal website data. I knew that I would be able to pull out if you were, I just thought.
Well, I don’t use told me that there’s a way to pay you if I want to switch to an enterprise version, but I couldn’t figure out where that was. It wasn’t on your website. It doesn’t seem like it was a major part of your business. Am I going to get pushback from my audience? Because some of them are worried about where the data’s going.
And then I thought, I can’t take my users away from you if we’re talking about web browser alerts, right? It’s not like I can say I’m taking all my permissions with me and going to your competitor, right. Which is great for lock-in. Do you see a lot of churn?
George: The main churn we see is just because we have a lot of small businesses using the product. and so they tend to be more support, price sensitive, or more likely to go out of business. but turning to competitors is really low. but I think we, we have by far the best product for the space, and
Andrew: Yeah, we’re looking at $99 a month. If somebody has, what is it? I don’t know. I see it actually starts to scale up based on the number of subscribers.
subscribers? Okay. So if they’re not active, I can just
George: Yeah. most of the time you probably don’t want to like, even an active user as are ones that you have the opportunity to reactivate. but if cost is a concern or if you know that those users, aren’t interesting, you can, you can print them.
Andrew: Where do you get the majority of your revenue from the browser alerts or from,
Apple alerts and then there’s browser there’s app. You guys also do email alerts. I have to collect email addresses for that. I’m imagining that’s a smaller part of your business, right?
George: It is for now. It’s actually something that were, putting more and more attention towards, because we started, we’re starting to see more of our customers, especially as customers start to pay us. And some of them get bigger. They want to just, they love our system so much for, for notifications. They want to use it for email as well.
and in that messaging has actually been a very popular channel for us that we introduced recently.
Andrew: That’s the alerts that come on within the app, not when I’m away from the app to remind me to use it, but when I’m in the app, I get that a lot more. Now from Spotify, they’ll alert me, I’d say an average of twice a week with an ad for message about a new podcast. I don’t know if it’s paid ad or what, but here’s a new podcast.
Hit this button.
George: Yeah. Yeah, it works super well because it lets a lots of company present new, timely content to their users. It can be designed by like their marketing team or product teams of developers don’t have to build it. and also they don’t have to ship a new app version.
Andrew: What do you mean? They don’t have to ship a new app version because he is, as long as they have your SDK in their software, they could just send out a new offer without having to update the app in order to get the offer in.
George: Yeah. So for example, one of the things that happened, around, the black lives matter movement, recently in the protests. There’s a lot of companies wanted to, share their support, for this. and so we saw a bunch of clients actually using that messaging to, to voice their support for black lives matter and to share links towards the resources and places to, to donate money.
and they were able to just turn this on overnight without having to ship a new version of the app with like some new page, they could just use it in that message.
Andrew: So I understand the use for website owners, for app makers. What about for end users? Isn’t it annoying that you can go to any website and they could flash an alert that says, do you want to get an alert to be reminded to come back here? And there’s no way to get rid of it.
George: There’s totally ways to get rid of it. but actually one of like, we, we agree. It’s like super annoying when you get to a website without context,
Andrew: And it stops everything else, depending on the browser, you could possibly not be able to do anything else. It’s it’s like those old iOS alerts you should. Get our brow. You should get our app instead of using our website. And in the end, Apple finally said, tell you what, we’ll give you an alert at the top of your site.
It’s not gonna interrupt the user’s experience. And they could always exit out right with these alerts. It takes over the interaction with the website. It doesn’t take over the whole page, but you can’t do anything unless you X out or say, okay,
George: Yeah. So there’s a couple of things that we’ve been doing to improve that experience, but also that the browser vendor has done. so for us, we actually provide, a built in way for our customers to create a prompts that has user con like customized context for why you should allow them. And by default, we tell our customers don’t prompt on the first visit prompt after the user has either specifically clicked the button that says, I want notifications and you, can we give you the HTML for the button or after they’ve had a certain amount of engagement, like visit number of visits or visit duration.
So we have a bunch of stuff we’ve done there. you’ve probably seen a little bell icon at some websites use. That’s another way
that we make. Yeah. it can be customized the colored and customized. but then the other thing that’s happening is browser vendors, have seen notifications, abused, or been used to trick users.
And so the latest version of Chrome version 84. if websites are using notifications in an abusive way, or if they keep showing the native prompt in the deny rate is extremely high. That website last you get penalized and will not be able to ask for notifications
Andrew: Alright, let me ask you one other question that, I probably should have asked earlier, when you made the switch over, you took people who had unlimited free and you told them now you have to pay, right.
George: Yeah. Yeah, it was very interesting, like plan we had to put in place. because actually we didn’t want to alienate all our users, in Kozlov, like a bunch of like anger or frustration. We also recognize that offering a really good free service was an insane source of leads for us. Like the reason we have a million developers now, is because.
They came to us, wanting to many of them came to this line and start for free. So what we did is we picked Gates that would affect a smaller number of users and the ones that were clearly getting value higher than our cost. And we still stayed very, very generous. So to this day, and, looking towards the future, we will always offer, unlimited mobile subscribers and unlimited mobile notifications for free,
Andrew: Mobile apps or
app users. Yeah. On web, we did put in a limit of 30,000, but that’s quite high and you can print your subscribers. and then it is pretty affordable going up beyond that. and so that, that turned out to be a very good kind of place to put the feature, gaming. And then the newer features that we’re building, always included almost all of them include a free component.
So you’re not messaging. You can create one for free. and if you want more than one. You either have to turn that one off.
Andrew: Got it. And so it feels like it’s the features largely that, well, if I’m understanding you, right, it’s Hey, you’re saying Andrew, the majority of our people who are free fell below the threshold, it seems like you’re also willing to work with some of the ones who weren’t right. And make some exceptions, but it wasn’t that much of a deal.
George: Yeah. Yeah. I mean, there were definitely customers that well for any customers that are really big, we don’t like our pricing. It doesn’t scale linearly. Like they can talk to us and we’ll give them the pricing plan where they have a volume discount. and for customers that were particularly squeezed by some of the payment Gates that we put in place, which was a very small number total, we did work with them to give them like pricing options that, that made it affordable.
Andrew: A lot of the new features. You gave a little bit to the free people, a lot more to the paid or you give none to the free people, right? Like comp time trigger notifications. That’s just for the paid plan.
George: Yeah, it depends. So our thought process is if we believe that in order to understand the value of a paid feature, someone has to try out a free version, then we’ll always do it that way. If it’s obvious, like. Time, trigger notifications, like through our documentation and just sort of like looking at it.
Andrew: Yes. All right. Let me close out with this. I heard in the last round of funding that you did, that you were able to take a little money off the table for yourself, that after all these years, you finally were able to put a little bit aside in the bank for yourself.
Okay. All right.
George: yeah, let’s see. I think just seeing the scale that the company, is out at this point, is really quite remarkable. Like the number of customers that we serve, the number of notifications that we be sent. it’s cool to just see the stats and know that everything we’re building has such a big impact,
around the world.
Andrew: And the response rate is huge on these things, right? You send an alert people or what’s the response rate on average for a web alert.
George: totally varies. Depending on the customer. you know, it’s like a social networking app and you get a message from a friend, like it’s going to be like 80% plus, if it’s something that’s more of like a marketing message, might only be like one or 2%. but all in all, when you compare it to any other channel compared to email, for example, it’s like
Andrew: No, we should probably reactivate this. We had it up on our site for awhile, and then I switched to Facebook messenger as an obsession and now, and so I decided to take it off just to focus on messenger and never put it back on, but we should do that again. I remember w we would have high response rates and I would.
I wouldn’t send a message out every time I had a new interview, but every time I had a new interview that was especially popular, I would send a notification out. People would come to the site, they would download it and it would get definitely the higher response that we were hoping for.
George: Yeah. Yeah.
Andrew: Thanks so much for being on here and for being a supporter of mixer G you were a premium member, you were listener, somebody went out there and you built a site, and I appreciate you coming in and doing this interview. My schedule has been a little bit unpredictable over COVID because I’m trying to figure out when I could.
Get recording time when school will be open when I’ll have time to myself. And I sent you a message yesterday and I was so happy when you said yes, Andrew, I will do it even though I’ve got less than 24 hours. Notice.
Thanks for coming on here. The website for everyone else is have, wonder, doesn’t know it.
It’s just one signal.com. And of course, if you’re in a, if you’re in WordPress, it’s built into your WordPress app. So go into. Go into the plugin section and get it. And I want to thank the two sponsors who made this interview. Then the first will actually help you get a WordPress website built fast. I know it’s fast because I tested it just recently.
I created a website for somebody. It took me less than 30 minutes to do the whole thing. The toughest part was I kept fussing around with the freaking themes, instead of saying just fricking launch Andrew, move on. I’m trying to get the best perfect design. And then that freed me to get started. And that is hostgator.com/mixergy to get the special price from them.
And if you’re hiring a developer, you know, to go to top talent, you should also know if you need a top level MBA to come in and help you think through your business strategy, especially now during these own, what is it that everyone says in the top of their email, these unpressed unprecedented times, especially now in these unprecedented times, really go to a top tower.com/mixergy.
Thanks so much for doing this. Bye everyone.