Andrew: Hey there, freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy.com, home of the ambitious upstart. Have you ever had an idea for a new business or new product and suddenly realized that somebody else already had it, and so you gave up and moved on to something else? That’s what happened to today’s guest, Joshua Parkinson.
He had an idea for a Facebook app that let you schedule your posts for the future. Soon after the idea occurred to him, he realized that other apps already existed and were doing it already. This is the story of what happened when he pushed through anyway, and how he built his business despite the competition. The name of the company is Post Planner. As I said at the top, it schedules Facebook posts for you and saves all that information on your Facebook timeline or your Facebook fan page timeline.
This interview is sponsored by andrewswelcomegate.com. I took the page that I have on my site that does the best job of converting hits into email addresses. Which means people come, they see it, they understand what my site’s about, and they give me their email addresses so I can stay in touch with them. I have a page that does extremely well at that. I want to give it to you and allow you to edit it and post it up on your site. It’ll be fully hosted and it’ll fully work. If you want it, all you have to do is go to andrewswelcomegate.com. Andrewswelcomegate.com.
Speaking of welcome, Josh, welcome.
Josh: What’s up, Andrew? I’m excited to be here, buddy.
Andrew: Me too. Before we get into the actual story, where’s your funding come from?
Josh: Well, we’re funded by customer credit cards, my friend.
Andrew: What does that mean?
Josh: Well, we don’t have any investors. We don’t have VC. We started out at the beginning and we had the choice of whether we were going to devote our time to creating some awesome pitch, a big slide deck, and going out and hitting the streets. Hitting Sand Hill Road [sp] and trying to get people to give us money.
Andrew: You’re in San Francisco. You’re right in the heart of everything.
Josh: Yeah. Or we could just try to build a product and get money from customer. The first option was never really an option for me. The second option is what we went with, and I’m glad we did.
Andrew: I know you’re a musician. I heard that you have a rhyme or something that fires you up about that. It’s not…
Josh: Yeah, man. I’ve got a few rhymes. You want to hear it?
Andrew: Yeah. Hit me with it.
Josh: [rapping] Pay attention while I let slip tricks from my sleeve. You need this refresher, so sit down and take a breather. Is this your lucky day? Yes. This message is effectively a kick in your ass. My company is plump, you see. It’s dropping Gs in front of me. All these blogs I read and see, they say I need VC. No. I need more visitors to be converted into a subscription that is recurring. If they leave too soon, they shall be churning. And then I won’t be able to say I’m only funded by customer credit cards. I’m only funded by customer credit cards. Nah, I ain’t funded by angel investors, no. My company funded, my company funded. I’m only funded by customer credit cards. I’m only funded by customer credit cards. My company funded, my company funded. My company funded, my company funded.
Andrew: How much funding do you have?
Josh: [rapping] Most these poseurs who are boasting never had a product in a marketplace chosen. They just posing. Brushing up their pitch. Sucking up to an angel like a Silicon Valley bitch. Wow, dude. You got in an incubator? Shit, man. You’re going to regret it later. These Y Combinator accelerators are gateway drugs. Get you addicted. You need a fix from an angel fund. Now you’re not funded by customer credit cards. Now you’re not funded by customer credit cards. You’re only funded by angel investors. My company funded, my company funded.
Andrew: You know what I admire about the way that you just did that? Most people would feel too insecure doing something like that for just one person. You did it, and then when I said, “All right, it’s time for me to ask you the next question,” you kept going. You weren’t going to let me dissuade you. That’s a lot of confidence.
Josh: I wasn’t done. That was the verse two, baby.
Andrew: I like that. How much? That’s what I was going to ask you. I was going to jump right in there into commerce, right in the middle of the art. How much customer funding do you have? Let’s talk about annual revenue. What are you guys doing now?
Josh: Our annual revenue, converted from monthly, is over a million I guess now.
Andrew: Over a million dollars in revenue. What kind of expenses do you have?
Josh: We have about 45 to 50 grand in people. Then all of our SaaS services that we pay for is another…
Andrew: 45 to 50 a month in expenses?
Josh: Yeah.
Andrew: Okay.
Josh: There’s seven of us.
Andrew: Okay.
Josh: And then we have everything on top of that. You know how it is with a startup. I think at least a smart start up founder and CEO is going to increase expenses to revenue. Our expenses increased as we increased revenue. We were putting a significant amount toward Facebook ads and Google ads over the last several months, and we just shut that down. Our content marketing is crushing it for us. Expanding expenses for us means hiring more bloggers or hiring more contracting bloggers to write more articles for us. Our blog is crushing it, man.
Andrew: Cool. Let’s go back in time and see how you got here. Before you were doing this, you were helping people with their Facebook pages. What were you doing for them?
Josh: We were just building the custom tabs. Back in the day, the days of FBML, which was the Facebook markup language. That was in fall of 2010 when I really started to get into it. I thought that it was going to be this huge business and all I had to do was get a few clients and I’d be on my way. I learned after two or three clients that I hate clients.
Andrew: What did you hate about them?
Josh: You have to spend time on them. You can’t fire them because they make up such a significant amount of your revenue. Obviously, mine was very small at that time, but I needed every one of them. They all have special needs, especially if you’re designing for them. They don’t like things. They want you to change this or that.
Andrew: Do you have an example of one thing that was especially annoying to have a client tell you?
Josh: I can’t even remember. That’s why I got into software, because of that experience. The money was small and the stress was high. The work was too much. I’m trading hours for money. That’s what really led me into software. That’s really pushed me toward that.
Andrew: I see. But back then in the day, if you went to Facebook.com/Mixergy, you’d see a static page that I created for Mixergy. Well, I didn’t create it because it was a pain in the butt to use their FBML. I would need a guy like you to create it for me, and that’s why people hired you. You were frustrated with that and you decided, “You know what? I’m going to start creating software.” The first thing you created didn’t go so well. What was that?
Josh: Well, that was a voter survey app. I was looking for a pain point that someone had. I had a friend who was a lobbyist in Utah. That’s where I’m from originally. He was working for several politicians there. We got talking over Christmas. That was Christmas 2010. He just said, “Hey, there’s a major pain point that these politicians have. They’re wasting a ton of money on this.” That is paper, snail-mail voter surveys.
They still do it. They spend thousands and thousands of dollars sending out snail-mail voter surveys to their constituents and have them fill them in. It’s just a totally unscientific and complete waste of money. Even if people fill them out and send them back, they’re self-selected and it’s worthless information. It’s just throwing money down a hole.
He told me about this and I thought immediately about Facebook. That was where I was spending a lot of my time doing these pages. That’s where I was looking for the opportunity. That’s where I saw the opportunity as an entrepreneur. That’s the first thing I thought of. I thought, “For the unique identities on Facebook, this is the perfect thing.”
We could have an app on a politician’s fan page and he could ask questions to his constituents. Every person would have one vote, because your one vote’s tied to your one profile. He could keep his finger on the pulse of his constituency by dealing with them on Facebook. I thought, “This is going to be awesome.”
I started down that route, and my first move was to go to Elance and try to find a developer. I didn’t anyone who could code. I could code a little bit of front end stuff, but I couldn’t create an app like this. I did that, and for a couple weeks I got a lot of people telling me exactly what I wanted to hear. “It’s on the way.” “It’s coming.” “It’s doing really well.” They’d send me a skin of the app and there would be nothing behind it.
I finally gave up on that relatively quickly, which was good. And then I decided, “You know what? I’m going to go out and I’m going to find someone who has already built the app that I imagine. I’m going to try to sell them to join me.” That’s exactly what I did. I went out and I found this guy who had built a customer survey app that was tied to Facebook identity, and you know I connected with them, a guy named Slav. He’s in Bulgaria. And I connected with him, and friended him on Facebook, and asked him if he wanted to do a Skype call, kind of proposed that . . . Actually, no, I sent him a message on Facebook. I said, ‘Hey, I love your app, let’s make it do this, this and this. I got customers tomorrow, they’re ready to buy. You want to do it?’ And he said, ‘Yeah, let’s do it.’
Andrew: Wow.
Josh: So we got on Skype and talked, and he made the changes exactly like I asked him to, and we had it up and going like in a week. And so I went to those politicians and put it on their pages, and then, Andrew, it was the same thing. It was like, I didn’t like these guys as customers. They were a different kind of customer, because they were hard to acquire. You had to have connections, and they don’t pay their own bills. Lobbyists pay their bills, so you’re dealing with a third party to get paid. So that’s really why that app didn’t work out, because I didn’t like the customer base. It didn’t seem scalable to me. So, but the [??] . . .
Andrew: I see, so . . .
Josh: Yeah, go ahead.
Andrew: I want to just pause here and make sure that I understand why it didn’t work out, because what you did made total sense. You saw an opportunity and a product that was needed. You wanted to take something that was already being done offline and bring it online again, something really helpful. And the reason that it didn’t work out is, you didn’t make sure that the people who were going to use it were the ones who were paying, and so you’d have two different masters to try to court. And the second thing is, there weren’t enough of them. Right?
Josh: Yeah. And they were hard to get to, as well, right?
Andrew: And they were hard to get to. Okay.
Josh: And they were like a special class. You know, I don’t think you can . . . for example, I don’t think you could target them on Facebook with ads. I don’t think you could target politicians. That’s just an example. They’re not like a . . . they’re a small demographic.
Andrew: Give me an example of one of them that you pursued, and it didn’t work out. I really want to understand how this plays out.
Josh: Yeah, it was, you know, I really was just in the state senators and state representatives in Utah, so the people who were in the Utah legislature.
Andrew: Okay.
Josh: And every single one of them that I could acquire, it had to be connected to the last one, right? So I had to get recommended by the last guy, or I had to get recommended by my lobbyist friend.
Andrew: So did you get to reach one of them?
Josh: Sure.
Andrew: You did.
Josh: We reached . . .
Andrew: How did you call the first one?
Josh: We reached . . . We had about 12 to 15 right off the bat. And then . . .
Andrew: How’d you get the first 12 to 15?
Josh: The lobbyist.
Andrew: Oh, so you had a lobbyist. How’d you get the lobbyist?
Josh: He’s my friend.
Andrew: Got it. And so your friend introduced you to his clients and friends, they signed up. And now for you to get . . . Uh-huh?
Josh: Yeah, I mean they were excited. That was the thing. They were into it. Facebook was getting a lot of press at that time. This was the time when that movie came out, The Social Network, so everyone was talking about Facebook, and everyone was getting on, and they were excited. And it was a cool app. But, you know, after those first 12, or whatever it was, I made a few cold calls, and I just quickly realized that this was not something that’s going to go viral. [laughs]
Andrew: Give me an example of what happened when you made a cold call to a senator.
Josh: They just wouldn’t let me talk to them. They told me to call back at another time. They said he’d call me back. I tried to talk to my lobbyist friend, if he could connect me with them, and he was too busy. You know, it was just a pain in the ass, man.
Andrew: Okay, and you also didn’t like those clients. And the thing that strikes me is, you’re a guy who used to stand on the street and sing for money. People would just toss money in your bag, I’m assuming, right? So why . . .
Josh: [laughs] Yeah. I did it all the time. And I was good.
Andrew: So why was that okay? Why would those customers, some who would just pass you by, some who wouldn’t look at you, some who would maybe even be a little disgusted that you’re doing it, what did you like about them?
Josh: Well, what I liked about them is that there was no question about the value I was providing. If I wasn’t providing value, they’d just keep on walking. That’s the pressure of a street artist, right? You have to stop them in their tracks first, and then you have to make them stay there long enough that they get absorbed into the art you’re doing, the music you’re making. And then, you have to be good enough that they reach into their pocket and drop some coins. But, even better, then you have to be so good that they buy a CD from you, because that’s where the real money comes.
Andrew: How do you be so good that they could do that? It’s not just about the music. Isn’t it about also the way that you approach them, the way you show appreciation, or am I wrong . . .
Josh: Sure…
Andrew: . . . and it’s just the music . . .
Josh: . . . sure.
Andrew: . . . and if it hits, it hits?
Josh: Sure, I think part of our secret sauce back then was a lot about personal relations in a weird way: making eye contact, not making eye contact. You make eye contact initially to get them to stop, and you vary eye contact with them because if you stare at them the whole time, then they’re going to get uncomfortable and keep walking. So it’s this balance of eye contact and connecting it with every single person who stops and just nurturing that relationship and not forgetting about them coming back and then giving them a glance, singing a few words to them, then the next guy, then the kids in the front, and then the grandma back there who’s nodding her head. That was the interesting thing, that was the interesting challenge, and I think we pulled it off pretty well.
Andrew: That makes sense. All right, so now this survey idea isn’t working out. What do you do next?
Josh: Well, you know we had various ideas, and this was at the time there was a company called [??] Social that was really killing it at that time, and several others. This idea of having a whole suite of Facebook apps was really popular, so that just seemed like something that we could do, too. One thing that we noticed was most of them were simply tab applications for promotions. This was also the time when you could come to a Facebook page and you would land on a landing page. You could have a little image that says “Like my page and then you can see this!” They don’t allow that anymore, but that was how it used to be.
Andrew: “Like-gating” is what it’s called, and it was a way of getting people to like the page, because they couldn’t get the access that they wanted until they hit “like.” And yes, you’re right, at the time there were these people who were creating this suite of apps, and that’s what you wanted to do, too.
Josh: Yeah, I thought that was the future. I was trying all kinds of ideas. I had some contacts in the auto world, and I was thinking about doing an app for car salesmen, where you could put your Facebook picture inside of the car and see how you look in the car before you buy it. You know, we had all these crazy ideas, but one of them was just to schedule posts in the future from inside of Facebook.
Andrew: Okay. And so you said, “All right, we’ll start with that.” Was that the very next app that you created?
Josh: That was the next one, yeah. So we started with that-
Andrew: And Sloth [SP] created it?
Josh: [??] created it. So that was the cool thing is that the survey app turned out to be a great thing because that’s how I met my technical co-founder, which is a hard thing to do. You probably run across this all the time. The business people, one of the hardest things to do is find someone to code their crazy ideas. I got so lucky that I met this guy who happened to be honest, and a smart business guy, and motivated; and he could speak perfect English even though he’s from Bulgaria, and his interpersonal skills are great. He just turned out to be a solid dude.
Andrew: And the way you got him was, you said, “He already has an app that he’s creating that’s doing well, I’m going to partner with him.” How did you convince him? I mean, you weren’t a guy who’d had tremendous success in Facebook at all, let alone in apps. What did you say that made him agree that you were going to be worth your share of the business? Did you say “I’m going to pay you?”
Josh: Sure, yeah, yeah.
Andrew: Ah, okay. So you were willing to pay him, and that’s what it was.
Josh: It was paying and partnering. From the beginning I was always “let’s partner.”
Andrew: “And I’ll give you a share.” Did you give him a share from the start?
Josh: Sure, yeah.
Andrew: You did.
Josh: Definitely. It was so vague. It’s so vague in the beginning, right? Like you don’t even-
Andrew: How did you express it? The money, I’m assuming, was not vague.
Josh: The money was more like “we’ll share the revenue.” The main thing is that, and this interesting because this is what really allowed this whole thing to happen, that we live in a world today where we have Skype and Facebook, so I could vet him. So I looked at his profile. I friended him. I looked at his profile. I saw pictures of him at these start-up conferences, speaking, so I knew he liked start-up culture and he was interested in that. And so my whole approach to him in the beginning was “Hey, I already have customers. You already have an app. This is perfect. We come together, and we have an app for customers on day one, so let’s just do this.” And I think that was what really sold him.
Andrew: You didn’t have that many customers, but you did have customers.
Josh: Well, I exaggerated, Andrew, right? I said I had a ton of customers.
Andrew: Oh, you did?
Josh: He was chomping at the bit, man. We just got to get this app to ’em.
Andrew: All right, cool. So that’s how you partnered with him, and I know you guys have been working together now for a long time. You had him on board when it was time to create the next app. How long did it take you to create the Facebook scheduling app?
Josh: About a month and a half.
Andrew: A month and a half, and one of the first steps you took was-
Josh: So we started in February, and we launched at the end of March in 2011.
Andrew: And it started with a mock-up, right?
Josh: Yeah. I drew up a mock-up, which was horrendous and ugly. I look back at it now and I chuckle at it. I just mocked it up. I took screenshots of the Facebook publisher and I just cut and paste them onto a blank white canvas. I added a few things I had screenshoted from other things. I’m not really a designer, either. I’m not really versatile in anything other than Photoshop and screen grabbing and stuff like that. I couldn’t design a beautiful lab, but I got the basics there. I sent that to him and then I explained how it would work. His first comment, which is interesting, was “Hey dude, there’s already Hootsuite out there. They already do this.”
Andrew: Yes. And not just Hootsuite, but others. So Josh, you hadn’t even gotten started and you already heard that there were alternatives out there. Why continue? Why not say, “Hey, you know what? I’m going to build a suite. Let’s start with something that nobody’s created yet, or that no huge company created yet. And then build something that’s has more competition.” Why did you continue?
Josh: Well, part of it was that I didn’t have any other option. Part of it was just pure, “Let’s just do it. Let’s just go for it and try.” I would like to say I was as sophisticated of an entrepreneur as I am now, where I would actually recommend that you do it. The market’s been proven. The demand’s proven. There’s a clear pain point that had needed to be solved and is being solved. It’s a big market. All those reasons are great. Really, at the time, I was more like, “This is all I have. Let’s just start with this and try to make it better than the rest.”
Andrew: I see. Today, you would advocate it. Why would you tell someone who has an idea? Well, I guess you said it. You’re saying, “Look, if there’s a big company, in fact, if there are a lot of companies out there doing this, then it means that there’s a need for it that’s big enough. We can find a small part of that need that those bigger companies hadn’t satisfied. As long as the market’s big enough, we can have a small share of it and still do well.” That’s why you would still advocate it.
Josh: Yeah. You have a proven market. If the market’s fragmented, if it’s big and if it’s fragmented, that means that a lot of people have different features. They’re competing with different features, and no one’s proven that they’re the best. With a thing that’s changing as quickly as social media is, you know that there’s going to be brand new pain points in the same realm.
You can compete, you can out-iterate, you can out-compete them on new features and on customer service and on branding. Now, we out-compete a lot of our competitors via content marketing, which is somewhat related. Our app now has become a content app. There’s various ways you can out-compete your competitors, but you can’t do that if you go into a market that’s brand new and unproven. You could be in a market that just doesn’t have pain and there’s no money to be made there.
Andrew: How did you get to your first customers?
Josh: We had signups on day one. Not a lot, but we had some coverage in TechCrunch France on day one. That got us a little bit of hype. Then, we just started reaching out to influencers back then and asking them to use the app. A few of them bit. We nurtured those relationships. It was really slow going. I don’t want to paint this as we had hundreds of users three days later. We didn’t. It was like two users on day one and then a few days and then a new signup. It was very slow at the beginning.
About three months in, we launched our first content features. We call it the Status Ideas Engine. We still have that. It’s still a very popular feature where you can go in and you can choose a category, like questions or fill-in-the-blanks or quotes. We had a database full of pre-written status ideas.
Andrew: So if I don’t know what to write, you’ll give me something that’s going to go viral.
Josh: Right. That was the pain point that I saw from my days doing custom Facebook pages. You could build a business the coolest Facebook page in the world and then hand it over to them. The first thing they’re going to ask is, “OK, now what do I do? What am I supposed to do on Facebook?” The main thing is they don’t know what to post. A lot of businesses still have that problem. That’s why we’ve taken our app fully in the direction of content.
Andrew: I see, there’s trending content that I can use here within the app. There’s viral photos. There’s status ideas. I can come up with questions, fill in the blank, contests, promo, trivia, deep thoughts. Let’s look at a deep thought. “Only Gurus can access our . . .”
Josh: [??] You got to upgrade, bro.
Andrew: So, I have to buy in order to see that?
Josh: Yup.
Andrew: Oh, right. Because then otherwise I could just copy and paste it into my own account. And what you do is, if I try to use it, you pop up something that says, ‘Try for 30 days for free.’ And then I click, and then I give my credit card, and the first 30 days are free and after that, you charge. Right?
Josh: Yup.
Andrew: So there is no free period without a credit card?
Josh: [??] There’s a free app. There’s a free app that you can use to schedule posts on a limited number of profiles, but you can’t access all of our content. If you want to access the content features, that’s the first level of upgrading.
Andrew: Okay. For the first version, you charged how much for?
Josh: We started at $4.95 per month. Five bucks.
Andrew: $4.95 per month. You’re smiling as you say that. Why are you smiling?
Josh: Because that’s so cheap, and you can’t build a business on that. There’s no way. That, also, allowed us to get traction, so maybe it’s a good way to go to start out. And our app just had so few features that I don’t think it was even more valuable than $5 per month. Once we brought out the status ideas engine, it became more valuable. And then we started adding more features. Actually about 6 months in, we released this white label version, where you could name the app your own brand name. Then when you posted on Facebook, it would say, ‘posted via Andrew Warner.’ Facebook removed that attribution from page posts about 2 years ago, so we had to scramble when they did that. That was our first foray into a higher priced product.
Andrew: I see. I remember talking to Buffer, and they told me that in the early days, they talked to customers a lot, before they even started coding. They put up an email request box on their site. They talked to people, who filled out that box. They, then, talked to people, who said they were interested in paying, and they kept talking and talking. What were your customer conversations like in the early days? . . . If any.
Josh: Wow. [laughs] I can’t remember doing that much, then. I didn’t really follow that whole “lean way” of doing things. It probably would have been good to do so. I didn’t really know that much about it in the beginning. Yeah, honestly, we didn’t talk to customers that much. I guess a few here and there, but that doesn’t stand out as an important thing that we did.
Andrew: Okay.
Josh: I think that that’s, and I hesitate to say this, but that’s kind of my philosophy. I’m a little bit more on the “give customers what they don’t know they want yet.” Right? That side of things, rather than ask costumers what they want, and build that for them. I’m more on this side of that whole argument.
Andrew: So then, how did you know, for example, that people needed ideas for what to post? It was just your own personal experience.
Josh: Yeah, I knew that the clients in the past needed that, and I just knew that people needed it in general.
Andrew: [??] They didn’t say that. They didn’t say give me specifically examples of what to post. You just saw that they had problems trying to figure out what to post.
Josh: Exactly.
Andrew: So Josh, it seems to me like that’s the same thing that Buffer’s doing, except they had to make a phone call to people. And not just Buffer, but the whole “lean startup” methodology is to talk to customers and see what their issues are, and not ask them what their solutions would be. So it seems like you did it by working with clients.
Josh: Yeah, maybe I did, but it was so much earlier. It was like six months earlier that I did that.
Andrew: You mean six months before you even started this?
Josh: Yeah, so, I knew from my experience that they had those needs. I didn’t go out and ask them and get more information from them on other problems they were having, et cetera, et cetera.
Andrew: Okay. Content marketing: we talked about it a few times, and we touched on it in this interview. What’s the first bit of content marketing that you did?
Josh: Well, this is another funny story. Just randomness in the life of an entrepreneur. We didn’t do much content marketing at all for the first year and 1/2 of our company. We had a blog. We posted to it like once every 2 months randomly here and there. I think released an info-graphic that did really well one month. We didn’t pay anyone full time to be a blogger for us. But then in December of 2012, yeah, right, I got an email, a random email from a guy named Scott Ayers [sp]. Who I had known because he’s working for another start-up Facebook app called Hubsy [sp]. That’s not around anymore and that’s why he was emailing , because Hubsy had gone down and he lost his job there. He had created this video saying hey, guys, you know, I know a lot about social media, I don’t want to go and get a full-time job. I can blog. I can do this. I can do that. If you know of anything out there, please let me know.
I think he only meant to send that to like ten people, ten like influencers. He accidentally sent it to every person he ever gmailed in his life. All right and that’s why I got it. I got this at like Christmas 2012 and immediately I was like you know, this is an opportunity. I should take advantage of this. I wrote him back immediately. Got on the phone with him. I said, hey let’s try something out and he was kind of, he was into it, but he was a little bit reluctant to do it on a contract basis. He was like listen I know what I’m doing. Hire me or don’t hire me. I’m like okay, let’s do it. I’ll hire you. So we hired Scott at that point. I hired him on January 21st, 2013. In December 2012, we had 9,000 unique visitors to our website. This month we’re going to crack like 280,000. So, we’ve increased like 30x in about you know, 20 months.
Andrew: Because of his content marketing?
Josh: Because of his. He was the sole blogger for the first nine months then, I hired another guy named Aaron Lee who is awesome. Then, I hired my brother as an editor. Now, we’re even looking for more. I have several guest bloggers who are blogging for us. I contract out single blog posts from several writers, because this is what’s proven to be… this is what drives our entire business.
Andrew: Content marketing.
Josh: Yeah.
Andrew: What’s the content marketing process? Let me see, I’m going to go to postplanner.com. I thought I was on it, but I have all these tabs open that sometimes.
Josh: That’s the first thing right there. That’s not how someone’s going to come to us, all right? They’re not going to type in post planner, because they don’t know who we are. So, what they’re going to do is they’re going to type a question into Google that says something like how do I get more Facebook likes on my fan page. Then, they’re going to see search results and we’re going to be right at the top there. Probably one, or two or three of our blog posts for that particular search query. They’re going to click on that. They’re going to come and read the blog posts. They’re going to see calls to action in the side bar. They’re going to get hit with a side bar when they exit that says hey, if you really want to get more like, try our free app. They install the app and then, we begin to nurture them from there. You know, we hit them with marketing messages. Tell them what our pay versions do. That’s the top of the funnel.
Andrew: I see. I’m looking at one right now that Aaron Lee put up fairly recently. 65 ways to make awesome Facebook covers and one of the examples is a dinosaur that’s about to bite the head of the person’s profile whose on it. It looks pretty cool.
Josh: Yeah, that place is crushing it man.
Andrew: Yeah, it got 1.8 thousand.
Josh: Thousand.
Andrew: Yeah 1.8 thousand shares. I see okay.
Josh: 1.8 million would be good though.
Andrew: Yeah, for a second there I said wait, who does 1.8 thousand? But, it’s the app. It’s the side bar app that you guys use. It says 1.8 thousand. So it’s doing really well and I can see on the right margin that there’s Brian Morgan’s face. He’s saying Post Planner saved us countless hours of work. I can click a button to say, yes I want it for free. I can give you my email address. I can see what Kim Garth [sp] boost social got by using Post Planner and again click yes. So, that’s how people come in. That’s how you get them to try the app out. Once they try the app, at some point you say to really use this you need to pay. Then, you lead them to a page on Facebook where they can select which level they want. Google is the first level $29 a month. They submit. They pay you and become one of your investors so to speak.
Josh: Almost, it’s more like they in the moment they come to the blog and they install the free app, but then they go to the app and they start running into walls just like you ran into, right? You ran into the wall when you wanted to get a status idea. Then, at that point, you’re going to make a decision of whether you try the paid version.
Andrew: But, first you collect their email address so that they don’t know, you send [crosstalk]
Josh: We get their email address. When they give permission to install the app, they give permission to take their email address. Then, they get into our newsletter. They start receiving our mess sages.
Andrew: I see and actually you guys do a really cleaver thing with the app where as soon as I come in before Facebook asks me for permission you say, Facebook is about to ask you to do this. Here’s why you should say yes and you’re setting me up to say yes on their button.
Josh: Yeah.
Andrew: It looks like there’s a lot of testing to get to that. What kind of testing do you guys do?
Josh: Well, we know we do some basic AB testing. It’s hard to answer these kind of questions right now. We’ve been in this strange period for about two or three months. We’re launching a web app that’s going to replace our Facebook-based app. Actually, by the time that this comes out, that will hopefully be out there. It’s a strange period in the life of a business.
Andrew: You don’t want to talk about the past one. You want to talk about what’s coming up next. That’s what’s most exciting.
Josh: Yeah. We haven’t really done a lot of testing. We stopped all that on the old app. We’re in this limbo phase where this new, awesome, amazing app is going to come out. We’re just waiting for the final thing. It just takes another couple weeks and then another couple weeks. It’s just a strange thing in the life of a software business when you do a big update like this. You have to stop innovating for a little bit and stop testing, at least we did. Maybe other people…
Andrew: Stop with the old one so you can focus on the new one.
Josh: Exactly.
Andrew: I have to tell you, the old one did really well. I want to understand how you got it there. It’s because of the success of the old one that you have the money, the confidence, the customer base, the ideas that allow you to build the new one. There are quite a few things here that I really like about what you did. The first is you let me know what’s coming up. As soon as I hit Facebook, you say, “Facebook’s about to ask you for permission.” That’s clever.
Within the app, you have some kind of training. I don’t just use the app, I can also learn how to use the app and learn how to do social media right. That’s not so much a course as a set of how-to guides that include gifts that show me where my mouse is supposed to go. Where do you get these ideas? What’s the process for innovation?
Josh: Well, on the first one, it was just purely a numbers thing. We saw that so many people were coming to the app. We were getting a 60-70% install rate. That means 30-40% of people were getting to that first permission screen and then they were bouncing because they were afraid of giving permissions on Facebook. We just thought that if we just explain exactly what they’re doing, show the exact screenshot of what they’re going to see, and then explain it for them in a really clear and concise way, we thought they would go up. It went way up. It went up to 96%. It went from 60-70% to 96%.
Andrew: That’s huge. A lot of times, that kind of data gets buried. In fact, it did even for us. We had this mailing list at Mixergy where a third of the people who signed up for it ended up confirming their email addresses. I didn’t notice that that was true for maybe three months. The only way that I knew it was I said, “Here’s the flow where users are going to the experience that people are going to have on the site.” I said, “Let’s get numbers for it.”
We put each step into a spreadsheet, then we put numbers, and we said, “Whoa. Why did we lose people here? It’s the confirmation page.” And we said, “What can we do to make it easier for people to understand that they’re expected to confirm?” We just added another page saying, “Go into your inbox and confirm.” Suddenly, we went from a third of the people confirming to over 85% confirming. Huge. But that number disappeared until we put it on a spreadsheet. What’s your process for getting that data?
Josh: It’s really not that sophisticated. In that case, we could just see in our Facebook Insights that so many people were bouncing. In general, you think that you’re supposed to concision rules. Fewer steps is better. You don’t want them to have one more screen to have to read and click through. Fewer clicks is better. I think many people are finding that that’s actually not the case. The more clicks that someone goes through, the more screens, they get more and more invested.
I don’t know if that’s exactly the reason why this was the case. If you keep doing that, we have three permissions. Before each one of those three permissions, we have a screen that explains it. It’s not just the first one. We increased the number of clicks. We doubled the number of clicks a user has to take to install our app, and yet we increased the conversions to 96%.
Andrew: I see.
Josh: Don’t just assume that adding more steps is going to decrease conversions. Actually, sometimes it increases.
Andrew: Okay. The reason that you knew it was you looked at your Facebook analytics. You can see how many people were hitting your app and saw how many people were actually using the app. You said, “There’s a disconnect here, and this is how we’re going to increase it.”
Josh: Facebook provides, in the App Insights, the conversion rate on your permissions.
Andrew: Okay.
Josh: That was easy.
Andrew: I want to say this for my sponsor, Lead Pages, Josh. At the top of this interview I said that I had a page on Mixergy that had huge conversions for us, and I’m making it available for the world to use. I’m actually charging a buck for it. If anyone out there has a page on their site that does great conversion rates, that is especially clever, and they want to sell it, they don’t have to sell it for a buck, they can sell it for whatever price they want and keep 100% of the revenue. All they have to do is go to Mixergy.com/leadpages.
Lead Pages will make it so easy for you to design, create and make that page work for you and your customers that you don’t even need to know deep HTML. If you just have a page that works, or an idea for a page that works, go to Mixergy.com/leadpages, upload it there, and they will sell it for you as a template to other entrepreneurs who have websites, and just keep sending the money directly to you. It’s really simple. There’s a great opportunity for you to do it. Customers are looking for these kind of landing pages. All you have to do is go to Mixergy.com/leadpages, Mixergy dot com slash lead pages.
All right, not everything was going really smoothly, Josh. So far we’ve talked about a lot of the highs, but there were a big set of challenges, and they had to do with Facebook shutting you down.
Josh: Yeah, we got our first Facebook ban about 6 months in, and it was funny because it happened… I told you that we did that infographic. We devoted a lot of time to creating this infographic on our blog. It was kind of about our status ideas engine. It was a good infographic, and Guy Kawasaki shared it. So we had this huge boom to our page, to our website, and then Facebook banned us like, a couple hours later.
Andrew: Why?
Josh: Most of the time it’s just pure automation. So you’ve tripped a wire in Facebook that… your users are spamming people, so your app is considered to be a spam machine and so they shut you down. We never really find out exactly why, although the last time this happened, which was actually just a few months ago, we did find out why. But in the beginning- and I’ve got to say, Facebook has become way cooler about this and way more easy to contact – but in the beginning, they were just this behemoth, right? This faceless behemoth that, you know, suddenly your app gets banned and you didn’t know who to turn to. There wasn’t even an appeals process back then. So it was just really crazy. We thought our business was like, done, from one hour to the next.
Luckily we had some contacts at a few places that weren’t Facebook. There was this app, “App Bistro”. They’re not around anymore. We had started to sell our app there, and they had some connections to Facebook. One of their people was a former Facebook employee. It’s like this Politboro feeling, you know? You’ve got to know someone on the inside of the behemoth, and maybe, just maybe, you might get to the right place. Someone might know the decision maker, who might be able to trip the wire back and turn your business back on. It was really scary, and it still is, to a certain degree. I think any app developer who creates on a single platform, or even a couple platforms, really faces this risk, platform risk. It happened to us and it sucks. It was very stressful.
Andrew: How long were you shut down?
Josh: In that case we were shut down for at least a day, and immediately, Slav got in and created a second app to replace it, and said “Hey everybody, go over to this app.”
Andrew: It was the exact same app, just…
Josh: Yeah. Which is not the way to do it, right? That’s not the way you want to run a business.
Andrew: No.
Josh: So that happened the first time. That was six months in. Then the same thing happened a year ago, but this time it was really legit in the fact that we used to have group posting. If you don’t know about Facebook groups, they’re like… A certain side of Facebook groups is this kind of cesspool of multi-level marketer-
Andrew: Oh, really?
Josh: -make money online, spam people. A ton of our customers- in the end it worked out to about 30 to 40% of our customers were these types of people. They were just carpet bombing Facebook groups with their spam messages, with our app. Our app was pretty powerful. You could select like, 200 groups, compose one message, and click ‘Post’ and it would put the same message to two hundred groups like immediately right. Obviously that resulted in a lot of people; I mean that’s a horrible thing for user experience on Facebook. No one wants to go to Facebook and see their newsfeed filled with spam.
So legitimately Facebook you know firstly they gave us a warning and then there was a little temporary ban and then they rescinded it and said you guys got this much time to stop this from happening. We made a decision really that we decided to shut down Facebook groups, which was a huge hit to our business, like I said it was 40% of our customers. So that was in November of 2013 and from one month to the next, our revenue went down by 30%. We lost like 30% of our customers in two months.
You can imagine after a nice growth trajectory and then you just from one month to the next you get hit that down to like eight six months before. It was tough. We had to grow through that. But in the end, these kind of challenges are great because they force you to make changes that you don’t know are going to be beneficial in the future but turn out to be. And us banning like stopping group posting made our app a much more of a legitimate app for businesses. That’s really the only sustainable way to create a business as the business that we had targets small businesses that are really doing real marketing on Facebook. So in the end it led to something that’s positive. Bu it was scary as hell when it happened.
Andrew: Did you have to cut off your salary at that point or suffer personally because of that.
Josh: Sure man, The CEOs salary, the first thing to go was brother.
Andrew: How did you do it? Because you live here in San Francisco and it’s not cheap here.
Josh: Well luckily I had a really smart wife who makes good money. And it’s only because of her that I was even able to start Post planner and try all these things in the first place. So you now a lot of people don’t have that luxury and I realize that it isn’t one. But other people I guess have their parents. Some people don’t have anything like that. But it’s not easy. If you don’t have if you can’t pay your bills, it’s pretty hard to bootstrap an app for six months with no salary.
Andrew: So you did over a million in sales in the past 12 months.
Josh: No. That would be our future run rate considering what we made in the last two to three months.
Andrew: Have you got on the pocket put on the bank more than a quarter million dollar from this business yet?
Josh: Personally.
Andrew: apart from your salary.
Josh: No I mean we don’t have a million bucks saved up.
Andrew: No yeah because…
Josh: Because we plowed up capital right back in to the business. That’s the way you scale. That’s the way you grow. That would be a stupid thing for me to do as CEO is take that money and leave it in the bank. I want to invest that in stuff that would grow the business. For us, that’s hiring new bloggers. Like I said we completely shut down our ads. Because I don’t know actually I mentioned that. We had completely shut down our ads in the last couple of months. We had a pretty big budget for around six months. And they just couldn’t compete with our content marketing. The cost per acquisition for customers was so much higher from ads that it didn’t make any sense so.
Andrew: And that’s a lot harder to predict how well content marketing is going to go.
Josh: It is harder to predict, but it is a much more long term investment in the fact that it has a long term ROI. You know ads in general are like a [??] right something that you turn on and they are on and you get traffic from the ads and then you turn off, it’s gone. Right. Content marketing, you can’t turn it off. We get hundreds and thousands of people to our website every month and the only way we could stop them from coming to our web site is to turn off our web site. They come like clockwork be an organic search and be an organic social.
And you know, so you could imagine the cost of acquisition to those customers is pretty low as long as you are not paying too many bloggers to blog for you. But you can handle so many content because you need editors you need the system to push out quality content. So, it’s not like, that’s a hard thing to scale. I can’t go out tomorrow and hire hundred bloggers and just have hundred posts per day. You know it’s harder than that.
Andrew: Why not?
Josh: Because you the quality of your writing does matter, you know? It’s not just a numbers game, you have to push out stuff that people can read, first of all, you know? You have to push out stuff that people will click, which means you’ve got to be good at headlines, you’ve got to be good at featured images. Push out stuff that people will start to read once they get to your website, so you’ve got to be good at intros, writing the intros to your blog post. And then you’ve got to get-you’ve got to push out stuff that once people start reading it, they keep reading it, and then it’s so good, that they share it.
Andrew: I see, and that’s [??]
Josh: If they [??], if they miss any of those steps, [??] it doesn’t work, so. Did I miss that last question, Andrew?
Andrew: Nope, we’re fine. Before we officially started, I told you that you had really good lighting, and a good setup. I know you’re doing this from home instead of the office today, and I complimented you on it. You said, “It’s not just the lighting, it’s the man, too,” or something like that.
I said this guy’s got a lot of confidence. And then I went back and I looked at my notes, and you told April that confidence is one of the things you got from building this business. Was there ever a period when you weren’t confident?
Josh: I mean, I don’t really know what that word means, you know, ‘confidence’. I mean, I just know what I can do, and I just do what I can. So, I mean, I think that actually the better trait to have is actually humility, not confidence. And I think that the one leads to the other, the more humble you become, or the more you realize how little you know, the more comfortable you can be in your own shoes.
Andrew: Why?
Josh: Maybe because you’re honest with yourself about what you can do, right? When you have too much hubris, and you think that you’re smarter or more capable or stronger or invincible, then you probably have more problems, and you probably have more failures. Yeah, that probably leads to less confidence in the end. But when you are honest with yourself about what you’re capable of.. I think I’m losing you.
Andrew: Yeah, looks like our connection is suffering again.
Josh: Ah man, sorry about that.
Andrew: It’s all right. But here’s what you said to April. You said, “Look I never thought-There was a period of time in my life where I didn’t think that I could build a mobile app and compete on every playing field like my competitors. I just felt like I was more of a hacker app and that maybe my customers were scammers”, and so you lack confidence in your ability to scale beyond or to grow beyond. There was a period where you felt that you couldn’t grow and create a mobile app. There was a period where you thought that you couldn’t compete with others, and then you eventually realized that you could. That’s what I mean by confidence, and what you’re saying-what allowed you to get that confidence, to start to realize that you can get bigger, that you can go outside of Facebook, for example?
Josh: Well, actually I think that that was smart to not-to know that I couldn’t do that, because really what that was is I knew I didn’t have the resources to scale that quickly to build the features, the kind of ‘dream app’ that I wanted to. I knew that I had to, in a [SP] lean-ish way, had to slosh through a less powerful app for a time, make enough money, hire a big enough team that we could build the app that we always dreamed of, and that’s where we’re at now.
Andrew: Okay, do you ever look at buffer and get a little jealous of their growth, because they’re just raking it in right now? And they’re essentially doing the same thing you are.
Josh: Sure, man, I look at all of our competitors and I want to compete with them, and I want to build something more powerful than them. That’s just part of business. But I have a lot of respect for those guys, and I’ve learned a ton from those guys, with all their transparency and talking about things that have worked for their business. I read it all the time, I learn from it, and I benefited from it.
Andrew: What’s the number one thing you learned from them?
Josh: Well I remember, actually, it was on your program with you, you were interviewing…
Andrew: Leo? Or Joel?
Josh: No, the other founder, Joel. Right?
Andrew: Yep.
Josh: And he talked about exactly what we were talking about earlier, about not talking, not stressing price so much in the in the sign up flow. Get your customers into the app, and using the app, and then let them hit walls. I remember him specifically talking about that, and that really, like, I thought, “Yeah, that’s, what we got to do.” Eventually, that’s exactly what we did. I definitely learned a lot from those guys.
Andrew: I see, so that’s where what we talked about earlier, what I experienced while I was using the app, and this interview came up. I tried to use it, and there was a wall that said, [??]. And then got it, wow. That’s pretty cool. Alright, I don’t want to leave people with this idea that you are the same as Buffer. There’s clearly a lot more that you do than any of those other apps, right? Especially, considering your focus on Facebook, and soon, you’re going to grow beyond it. What are some of the key features that others can’t match that people, who are using Post Planner, should pay attention to?
Josh: Sure, for me, what I really want for our customers is I want them to get results. All of our competitors allow for scheduling, and some of them, even, give you the content to post, but I don’t want to just do that. I don’t want to just allow our customers to fill up their quota for their fan page and post that three per day, and that’s it, and not get any results from it. So, I want to build an app that once people start using it, they’re like, ‘Holy Shit! Facebook actually works. I’m getting so many likes. I’m getting so many shares on my posts. My posts are going viral. I’m getting a lot of traffic, now, to my website. That’s my whole imperative, as a CEO of this company.
I want to build an app that when people use it, it actually works. We’re trying to serve content to people that almost can’t lose. That’s what our viral photos and our trending content does. We allow our users to find content that has worked in the past for other pages, and then give them the opportunity to share or replicate that content. At Post Planner, we look at every social media post as an experiment with data. That’s all it is. Facebook posts are just experiments with data. And our app just crunches the numbers, we crunch all those experiments, and then we show you the ones that worked.
So you don’t have to be guessing in the dark when you’re creating an image or you’re writing a status idea or when you’re choosing a third party piece of content that you’re going to share on your page. You don’t have to think, “Okay. I have to go off of a hunch.” You don’t have to say, “I really think this is really going to resonate with our audience. I’m going to post this and see how it does.” What we want you to think is, “Hey, look. This experiment, this worked really well. This was an out-performer in another set of circumstances. It’s very unlikely that if I perform the same experiment on my page that it’s not going also have a success. It’s very unlikely that it’s not going to have a success.” So, that’s, kind of, our whole mindset as far as content goes.
Andrew: Yeah, I do notice that. That you don’t just give me articles that I can post on my profile. You give me articles that are categorized, so that I can find the right category. In my case, it might be business or social media, and of those you show me only the articles that have gotten a lot of likes and a lot of re-shares. And that’s how I can be confident that when I post it on my site, it’s going to do especially well.
Josh: Exactly.
Andrew: And it is clever.
Josh: We try to find the outliers from any feed, so you when you add feeds to Post Planner, and then we crunch all that content, and we show you the out-performers, so you can replicate that experiment.
Andrew: Got it. All right. That makes sense. Alright, the website is postplanner.com. I get lost just looking at the content that you’re giving me to share with other people.
Josh: [??] . . . one success story, real quick, Andrew.
Andrew: Yeah, hit me.
Josh: You mentioned Kim Garth, she’s there in the call to action on the side of our blog. I just actually at a conference. I know you’ve interviewed Kim, as well, haven’t you?
Andrew: I think so.
Josh: Yeah, you have, because I remember. I watched it. Anyway, Kim . . .
Andrew: You know what I can’t remember, sometimes. Did I talk to them offline or online? Like even in this interview, you noticed there a couple times, you said, “Like I said,” and then you realized, “No, that was before. That was in our conversation before we recorded.”
Josh: Yeah, I remember I heard your interview with her. Anyway, she’s a great lady. I just spent some time with her this weekend in Florida at her conference. She does visual content just amazingly. Our app has been a godsend for her because now she takes the images that are viral photos. So she has a bunch of feeds in her Post Planner app, and she can see what the out-performers are of these images. Then, she just smartly replicates them, puts her branding on them, and gives them a much better design. So she’ll take a quote, for example. Inspiring quotes on images just kick ass on Facebook. A lot of the images coming through viral photos are exactly that.
So she’ll find an image that has an inspiring quote, and then she’ll take that text, and she’ll put it on a brand new image. So she’ll run the same experiment, but with a better design and her branding on the image. Well, she has had huge results, and just one of those, her most viral photo of all time has been shared 800,000 times. Her page has 100,000 fans, okay. This post has been shared 800,000 times, and it’s reached, like, 30 million people at this time, and it’s still growing.
Andrew: And this is something, Josh, that she saw through your app, through Post Planner, and said, ‘I will take it.’ Actually, I think that one is one that she just used as is. She didn’t put her branding on it. She didn’t do any twist to it.
Josh: I think the one that you’re thinking of is the one on our featured page. That’s one that didn’t get as many shares. Since then, she’s done this other one that has got 800,000, and now that’s pretty much all she does. She finds the success stories and posts part of them, then she replicates them. We didn’t talk so much about this, but Facebook it’s all about getting virality, getting a lot of clicks, so that when you share your blog posts, you get more reach. Because the more people, who click on those images and share them, they’re all signaling to Facebook that you shared good content, and they want to see more of it.
Andrew: And so Facebook shows more of your content, including those blog posts that actually help promote your site.
Josh: Exactly.
Andrew: All right, yeah, I do get carried away by those sections of the app: the viral photos and the trending content. It’s a great app, it’s an honor to have you on here, and I know that you’re just going to grow bigger and bigger. And I know it’s actually painful for you to do this interview. You really wanted to wait until after, but I’m hoping after the new launch happens, and things start to grow there, that you’ll come back and do a second interview.
Josh: Sure, I’d love to, Andrew.
Andrew: You bet. Thank you all for being a part of it. Thank you, Josh.
Josh: All right, thanks.
Andrew: Bye.
