Andrew: Hey there, freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy where I interview proven entrepreneurs about how they built their mega-successful businesses.
Today’s guest is someone who built his business on someone else’s platform. Specifically, he’s got apps that work on the Shopify platform, and I think that when it comes to something like this, a lot of businesses are hesitant. They don’t want to create a product that works only on one person’s platform because what happens if there’s a change in the business? What happens if this? What happens if that? All legitimate concerns. Still, it’s working. It’s working for him, and it’s working for other businesses, and I think we need to understand this model.
Devin Zander is the founder of SMAR7 Apps. They make tools that help Shopify storeowners boost their sales and automate their stores. One of their tools is called SMAR7 Bundle Upsell. When you add something to your shopping cart, just as you are ready to sell out, it says, “Hey, how about adding this one other thing too that goes along with what you purchased?” They make it really easy for you to buy that. That’s the kind of tool that they make. They built this up into a phenomenal business. He’s here to talk about how they did it and what you can learn from him.
This interview is sponsored by two companies. The first will not allow you to run any of his plugins. Right, Devin? Your plugins work just on Shopify?
Devin: Just on Shopify.
Andrew: So it will not allow you to run any of his plugins but will allow you to host your website, right? It’s called HostGator. The second will enable you to hire phenomenal developers. So if you learn something from Devin’s idea and you say, “You know what, I want to do the same thing,” you’re going to be able to hire great developers from them. Devin, it’s good to have you here.
Devin: Oh, it’s a pleasure to be here. I have been looking forward to it for quite a long time now. The process takes quite a while.
Andrew: Yeah, we do kind of make it hard, right? What do you think of the pre-interview process and the time that we require from you?
Devin: I think it’s all good. The big shock to me was honestly the delay from pre-interview to actual interview because I was like, “Oh, man. I’ve actually just forgotten everything that I said.”
Andrew: I’m okay with that because I’ve got it here in my notes, but you’re right. I do have such a busy interview calendar that it’s hard for people to get on. I’ve got to solve that.
Devin: It could be worse.
Andrew: All right. Let’s talk dollars and cents now that you’re here. Revenue at the time that you talked to our producer was $50,000 a month selling these tools. Now what is it?
Devin: So right now, our MRR from the app store alone has gone up to about $70,000, and this is just, you know, from basically having…I wouldn’t even say that we’re necessarily marketing more right now because our focus has shifted slightly, but we have been spending a lot more on advertising and trying to sell our…
As I explained to you earlier in the call, we have a huge package, and just by advertising that – and I can really talk about that later – but just by advertising that, it’s gotten our omnipresence up a little bit. We are more in people’s eyes, and now we’ve become a little more synonymous with Shopify itself because we do target a lot of the beginning audience, people who want to get into it or get into owning an online business or building a store, right?
Since we’ve been targeting them so much just with training and stuff like that trying to get them introduced to us to buy our courses that we’ve kind of started selling a little bit, it’s really helped our MRR go up, and it’s really nice because we haven’t had to put a lot of work into it.
Andrew: Wait. So you’ve always been really good at content marketing. You’ve done this challenge where you show people how to improve their store really fast. You do these videos that are phenomenal. You’re saying that in addition to those old videos I’ve seen, you are now selling a course, and the course is a paid course?
Devin: Yeah. That course, we are charging $2,000 for it, and it comes with lifetime access to all of our apps. We looked at our lifetime value, and we’re like, “Well, you know.”
Andrew: Got it. Got it. I see what you’re saying, and we’ll get into the methodology later, but you’re saying, “I bundled all of my apps, gave people lifetime access to them, and added some content, and I sell that for $2,000.” That’s what it is, right?
Devin: Yeah, exactly.
Andrew: And the logic behind how you got to that is really interesting. With that extra revenue, meaning people are paying you now for lifetime access to your software, what is your monthly revenue now?
Devin: Our monthly revenue now, if we just look at this year so far, so quarter one, quarter one, our monthly revenue was steady around $400,000 to $450,000.
Andrew: Every month?
Andrew: That means…
Devin: That’s gross, keep in mind.
Andrew: That means that an extra 200 or so people every month are paying you to buy your course and buy lifetime access your software.
Devin: Yeah, and what’s crazy about that is not only are we doing that much revenue, but it’s actually a lot more. We don’t see some of the revenue because, like I was mentioning to you earlier, it’s actually a partnership deal. So the other company gets paid first and pays us out our rev share afterwards. So the revenue on it has been insane, and that’s after our…
Andrew: I have a note here. We’re going to come back to it later in the conversation, but we’ll go in chronological order. Let’s understand how you got here. This is amazing, by the way, that you’re doing that well and that so much has happened since even the pre-interview. Let’s go back and just understand how you got here, and I also want to learn for anyone else who has a product idea or a software idea on the Shopify platform or on similar platforms. What do they do? How do they get it going? But you’re a guy who used to do what before you started this?
Devin: So when you say, “Before I started this,” would you say before I started working on Shopify? Because it’s a long, tiring journey, honestly. I’m young, so it can’t be that long, but whatever. Do you mean since I’ve gotten into the technology and app space?
Andrew: Yeah. So as I understand it, you were approached by these guys who are in ecommerce, and they said, “Will you help us?” Help us what?
Devin: Yeah, okay. So essentially, what I was doing before all this was sales consulting. I had done SEO. For those of you who don’t know, that’s search engine optimization and stuff like that. I was just working online doing a bunch of grunt work trying to make a living, and eventually I realized, “I’m kind of tired of doing this. I’m tired of building new websites. I’m tired of trying to rank in search engines.” It wasn’t fun for me. It was repetitive.
When you’re an entrepreneur, I feel like one of the biggest things that you should be doing and that most people do when they start is study sales, right, because sales is a key talent or skill that anybody should have because it can help you in any aspect of your life no matter what you do. So what I did was I started taking the methods I was doing, and I was just like, “I’m going to learn how to sell this.” So that’s what I did.
Andrew: Learn how to sell what? Meaning a course on it?
Devin: Info products, essentially, courses on whatever I was doing. I was doing Amazon affiliate stuff, so I’ve always kind of been in the ecommerce world, but I was just referring people to Amazon. I think my biggest store was I ranked number one for Kindle review, Kindle Fire review, Kindle Touch review, and then eventually, you know, it wasn’t ranked anymore. It was still a good deal, and I had to figure out a way to feed my dog still.
Andrew: Okay. So you were experimenting, but was the next step to teach it?
Devin: The next step was to teach it, yeah, because it was much more scalable, you know? I can build one site and do that and that’ll take up all of my time, or I can build a course on how I did it and then sell it to thousands and tens of thousands of people. It was the same process again, actually, because I started doing this, and I was like, “Man, I’m tired of making products now,” right?
So what skill did I master, right, during that process? And that was sales because I had to find a way to sell these products. So eventually, I moved into sales consulting for online startups of any kind like, “Hey, do you want to sell your product and you do not know how? I will build your marketing material, your sales material. I will contact all the key partners you need. I will get them on your side.”
I was actually speaking at a summit in Liverpool. This was back in 2015. I think it was June, yeah, and while I was speaking there, I was just telling people essentially how you can bring sales or large amounts of capital into your business quickly, and I was sharing some ideas on that. And after I was done speaking, we were at the party afterwards. I had a couple too many Jack and gingers, which was actually really hard to find, by the way, because, apparently, they don’t sell whiskey in the UK, which was…
Devin: I know. People drink beer there. I don’t know. It didn’t make sense to me, but it took, like, four bars to find some.
Devin: Anyways, over a few of those, I had this guy named Austin Anthony approach me, and he was like, “Hey, you know, I love what you do. I’ve seen what you do. We have this product,” and it was these two guys who owned some ecommerce stores, and they were just doing phenomenal things. He showed it to me right there on this phone. He was like, “Devin, you need to see this,” and basically, he showed me their Shopify store dashboards and the amount of revenue that they were earning, and they’re like, “We want to make a course. We want to change lives, and we want you to be a part of it.”
So right there, I mean, it was pretty crazy. They offered me equity in their company. They didn’t ask for anything for me. They were like, “We want you to sell this. We’re going to offer you 25% of the company. Do we have a deal?” He’s like, “You need to answer me now.” It was really funny too because it was a costume party and he was wearing a Rastafarian hat. He’s like this 6’8″ dude. He’s a huge man, and he’s dressed up like a Jamaican Rastafarian. He’s like, “I’m going to give you 25% of the company. Come on now.” Honestly, after seeing what they had, I was…
Andrew: What were they selling that you had to do it? I just interrupted. What were they selling?
Devin: So this was just an ecommerce course, basically. They took down…
Andrew: No, when they had their Shopify store, what did they have?
Devin: What were they selling? I don’t necessarily feel comfortable sharing because it’s their store.
Andrew: Give me, like, a topic. Apparel?
Devin: I can say one of them. I’m not going to share Justin’s stores, but my other partner, I’m not to mention his name because it will make it a little bit easier to find him if I mention his name, but camping and survival equipment. I’m sure you’ve seen [inaudible 00:10:00].
Andrew: I know their stuff. Can I say the name of their course? Because you guys put out a press release back then.
Devin: Oh, you saw the press release?
Devin: Yeah, I can actually link you to it if you want.
Andrew: And I can say it, right, in the interview? We’re not going to…
Devin: Yeah, it’s Ecommerce Experts Academy. That’s the course itself.
Andrew: Ecommerce Experts Academy. And then Austin Anthony was such a big name that I guess at the time people were willing to sign up because of him. You started working with him. How did you do selling his stuff?
Devin: I’ll admit it was very stressful because they approached me in June, and they wanted to launch on July 8. So they gave me three weeks to prepare something. It was pretty funny. We really had to do some ingenuity in the marketing.
So I was like, “Okay. How did this happen? How did I get to this point?” I was like, “Okay. I was in Liverpool. I was drunk.” So I went home and recorded a video of myself pretending to be drunk. It was like me recording myself in the mirror. I was like, “Devin, I have this message for you. Look to the future.”
Anyways, I talked about all of these amazing results that these guys were having running their store and kind of went through it with them afterwards after the joke had died out, you know, after my drunk video was revealed. It was like a whole top-secret drunk me left clues everywhere. So I recorded myself going around and finding all these clues, and they were basically all results-oriented clues. So I would find, like, a letter in my mailbox, or I would drive across the street and find this.
And we just ran ads like that and did a lot of our…my COO at the time, she just did a lot of outreach, and within three weeks we got it all done, and I think we ended up…in the first five days we did $700,000 in sales, and then, over the next week or two, because we kept it up – we kind of kept marketing because the whole idea was large influxes of capital, it’s not to be sustainable because it’s mostly affiliate marketing – and I think we got up to about $900,000 within those first 2 to 3 weeks in sales on that.
Andrew: How did you have so many affiliates?
Devin: Honestly, first of all, we did all of the affiliate outreach as well, actually, and it really wasn’t a lot. It was just some really good [inaudible 00:12:21]. We had a couple of affiliates. I think we had 3 or 4 affiliates that all did over $100,000 in sales by themselves.
Andrew: For example?
Devin: We had Don Wilson. If people are familiar with the Shopify or ecommerce space, they’ll know Don Wilson. He owns GearBubble, which is a print-on-demand platform, so they have a lot of customers. Chris Record, my partner now, actually, at SMAR7 Apps, not partner at the time, Matt Schmidt. These guys all came in. I gave them three weeks.
Andrew: What was Matt Schmidt doing? He’s the guy that does opt-in AI, right?
Devin: No, he’s actually my partner at SMAR7 Apps.
Devin: There’s probably more than one Matt Schmidt.
Devin: Surprisingly enough, right? But he runs ecommerce stores. He runs his own stores, and that’s why we have him on the team because we need our finger on the pulse of what’s going on in ecommerce.
Andrew: Okay. So alloverprint.it, that’s Don’s site.
Devin: I think it’s GearBubble.
Devin: Just gearbubble.com.
Andrew: All right. So you guys partnered up with them. They helped promote your stuff. You had this big sale, and still, you’re not with the company for an important reason.
Devin: Yeah, well, we kept together for a bit. We did a couple more million dollars in sales, but all in all the partnership didn’t even last year because, at the end of the day, it came down to, like, morality in the future. It’s not that these guys are bad people. I don’t want to say that. I don’t want anyone to think that. I loved working with them. It’s just our visions didn’t align. I wanted to do more for our customers while one of the partners, the one that I had left unnamed – actually, I might have named him, I don’t know – but I just didn’t like the way he handled things or how he…
Andrew: Like what? You didn’t name him, and I’m not going to name him, even though, frankly, he’s still on the freaking website. What was the issue? You’re still on the website. It’s the Skype name that I used to connect with you. It’s somewhere buried on the site, but I found it on the site. So without mentioning his name, what was the issue?
Devin: Essentially, he kept making promises to our customers that we couldn’t…well, we could. I don’t know why he just did not fulfill.
Andrew: Like what? What’s an example?
Devin: Like customers. So, “Hey, we’re going to release this update soon,” and just me, I’m a sales guy. I can’t do it. I’m not knowledgeable like these guys are. “Hey, we’re going to release this.” Get everybody really psyched up and then just disappear off the face of the earth for three weeks.
It wouldn’t have been a big deal if he didn’t make these promises, but here I am, the head of marketing, essentially, the face of the company, the connection with the customers, and I couldn’t take it, because we were working very closely with these customers. I had developed a very strong bond with them, and for them to look at me that way like, “Hey, Devin, you said this is going to happen,” and I thought it was because I trusted my partners, and then it all comes down on me, and I’m like, “Oh, man.” It was really depressing, and I didn’t want to deal with it. So I figured I’d pivot, do it on my own, and come up with and actually provide what we say we’re going to do.
Andrew: And the first thing that you created on your own was what?
Devin: That’s when we went out and made SMAR7 Apps.
Andrew: So you said, “Immediately, I’m going to go into software?” You didn’t go into courses like they do?
Devin: No, because I didn’t have the knowledge. You know, I’m not a Shopify guru. I don’t run tons of stores. I’ve run a store, and it did okay.
Andrew: So then how did you know what to create?
Devin: Oh, man, because I had, like, 50,000 customers, and I knew what they needed from them telling me.
Andrew: How did you get 50,000 customers? What do you mean?
Devin: That’s from selling Ecommerce Experts Academy. We had that on sale for a long time, and in our exit agreement with the company when I left, if the company were to ever disband or if any partner were to leave, they would retain a copy of the customer list for them to contact on their own.
Andrew: And so you could go over to them and say, “What is it that you guys need? What’s the issue? What would excite you?” Did you start making those calls, or was it more from talking them up until that point that you understood what they needed?
Devin: It was from talking them up to that point, honestly, because we had a very active Facebook group. We were talking with them, and we were doing weekly webinars every week. So we were constantly talking with them, asking them what they needed, asking them what they would like to see.
Most of it was supposed to be like, “Hey, they were supposed to give us an answer on something that we could give them education on,” and the people would always say, “Oh, I would really like a new way to do this or an easier way to do this or a mobile-responsive version of this.”
So after a lot of convincing, I convinced a friend of mine to launch SMAR7 Apps with me because I’m not a technical guy. I can’t code. I don’t know anything about it, but with the data that we had accrued from being in that Facebook group nearly a year talking with our customers, all 50,000 of them…obviously, they weren’t all talking to us. We probably had an active conversation with about 6,000 of them, and some would go inactive, right? But after having that conversation for so long and hearing what the people wanted, I knew what had to be done, and this was just an upsell app because at the time…and I don’t want to badmouth any other upsell apps. Honestly, the marketplace has become a lot more fair since we launched, and there are a lot of great competitors out there now, so that’s good.
Andrew: So you saw all of these problems that they had could be solved with just an upsell app.
Devin: The big issue was that when people shop online, 90% – and this is an average and, obviously, it’s going to vary, that’s why it’s an average, okay – but 90% of online shopping is now done on your phone, and what’s an easy way to increase revenue? Upsells. At that time, there were absolutely zero mobile-responsive upsell apps. This is a huge hole in the market.
Andrew: Right. I see. I see it. I thought you guys, though, from everything I saw at Ecom Experts Academy, I thought you guys were selling Amazon techniques.
Devin: No. That might be…no. [inaudible 00:18:07].
Andrew: Maybe, at one point, you guys…all right. So it was Shopify and…
Devin: [inaudible 00:18:11].
Andrew: …Amazon and ecommerce.
Devin: [inaudible 00:18:13]. What’s that?
Andrew: It was Shopify and Amazon and ecommerce is what you guys were teaching.
Devin: Yeah, basically. Well, the reason we never really cared to teach Amazon was just because you’re not that much in control of what’s going on. Let’s say you want to do Facebook ads, right? You need to have a Facebook pixel in place to track conversions and to really optimize your assets. You can’t do that on Amazon because there’s no place to put it, and if you can, I’m seriously missing out, but we just talked about this, like, last week, and it’s still not.
Andrew: Okay. Yeah, I know that there are a lot of challenges with Amazon.
Devin: You know, you don’t get your customer data and stuff like that, which is just…
Andrew: Right. You get more sales, but they’re not your sales.
Devin: Yeah, they’re not your customers. They’re Amazon’s customers.
Andrew: Okay. So you were understanding all of these problems that people have, and you said, “I’m going to go and create this.” Let’s take a moment to talk about my first sponsor and then understand how a guy who doesn’t know how to develop apps comes up with a way to do it.
But let me point this out. Your apps will not work on HostGator, which is fine, and still, when I go to ecomexpertsacademy.com and I look at the source, I can see – I don’t think it’ll be a surprise anyone – it’s hosted on WordPress. It has a standard OptimizePress theme, so no brain surgery involved in creating this type of thing, and it’s using Wistia to post videos plus your own plugin to post videos. Flowplayer, right? That’s the plugin for posting videos. It’s just a standard website.
The reason I bring this up is I know that there are people out there who have really good ideas, who are smart, and at the same time, they are overthinking what it takes to sell something, to build a small audience, a small customer base, learn from them, and then create the next product and the next product and the next product. WordPress now, do you know what percentage of hosted sites they are?
Devin: Do I?
Andrew: Yeah. Do you know?
Devin: It’s got to be over 90%.
Andrew: Actually, believe it or not, now you’re going to make my number seem really small. It’s 30%.
Devin: Oh, man.
Andrew: Thirty percent of websites now are run on WordPress, which is a lot for one piece of software. The thing is, though, you could host a website. You can host your WordPress website on so many other hosting platforms.
Why pick HostGator? Because they crush a lot of the competition, frankly. They’ve been around for so long that all of these little guys who I’ve interviewed who had great, phenomenal businesses, so good that I would interview them about them, would still nevertheless come on here and say, “Yeah, but, like, HostGator spanked us,” and the reason they did it is because they were getting aggressive. They lowered their prices. They got their hosting dialed in, and today, anyone who is listening to me with any idea of any website they want to put up can go to the best. Go to hostgator.com/mixergy.
Actually, you know what I’m going to say? I’m not going say the HostGator is the best. I wouldn’t be surprised if there’s a long list of people who are going to charge a lot more who are going to give you a better service. I think that saying someone is the best is really rough. There are lots of different reasons why you might want to choose a different hosting company. I just want to say they’re freaking damn good, and their price is low, and you can count on them being around. They’re not going to shut down. They’re not going to cause you problems.
All you have to do is go to hostgator.com/mixergy, and you will not only sign up for them but also get up to 60% off their already low prices, and if you’re not happy with them, they will give you 45 days to ask for your money back. But I think you will be happy with them, and I think you’re going to enjoy how good they are to work with.
We started out with them on the cheap plan, and then we leveled up, and I think we leveled up yet again, and now I’ve signed a three-year contract with them because I know that they’re just that good. hostgator.com/mixergy.
You know what? I’m kind of winging it in these ads. I should be a little more methodical and write things down. I just don’t want to be this scripted person.
Devin: Well, I mean, the mark of a true salesman is the man who doesn’t need a script and can wing it.
Andrew: Yeah, it also means, “Dude, don’t fuck up.” I say that they’re the best and go, “Wait a minute, Andrew. You’ve got to be honest.” I don’t know that they’re the best, because once you get into the best, I start to think of, “Well, the best at what? Are they the best at [inaudible 00:22:01]?”
Devin: Well, I think we’ve all used HostGator.
Devin: I think that says enough about them that we’ve all used them. I’ve used HostGator for many, many years.
Andrew: You have? What websites do you use on them?
Devin: Oh, man, my first 30, 40 websites that I built [inaudible 00:22:17].
Andrew: That’s the thing. They have that unlimited hosting plan so you can just put a bunch of domains up, see what works, kill the ones that don’t, and move on. All right, so you’re not a guy who codes. How did you figure out how to get this built?
Devin: Essentially, and this is an answer that a lot of people will probably not like, but I found someone who does know how to at least manage a team. He was my best friend at the time and still is. Luckily enough, he runs a webinar platform, so it’s pretty heavy stuff. He knows how to manage a team. It took me, like, four months of convincing, which it shouldn’t have taken that long because I feel like I made a pretty compelling point.
I was like, “Hey, we need to do this. We need to build this app. We need to build this upsell app.” He’s just like, “I don’t know if I have time,” and I was like, “Dude, if we release this app, it’s going to go crazy. People are going to love it. We’re going to make a ton of money really quickly, and we’re going to help our customers make a ton of money really quickly as well.”
So after three months of annoying him, he finally agreed to work with me. We were actually here in Austin, Texas. This was way before I lived in Austin, Texas. We were at Ryan Moran’s event, Freedom Fast Lane Live, and we were at our Air B&B, and I guess he finally had enough of me bothering him and all the ecommerce talks at Ryan’s event had motivated him, and we did it, which is pretty cool.
But an answer I can give, I could give people tips and guidelines on how to hire a developer. I mean, really…
Andrew: Wait. So he had a team of developers?
Devin: No, he just knew how to manage a team, and we utilized his team. He does have a team of developers. Sorry.
Andrew: What was his thing? I can’t freaking find him on LinkedIn. I’ve been trying and trying. He’s not that public, is he?
Devin: I mean, he is. I don’t know. It’s Wyatt Jozwowski.
Andrew: Wait. Did I just miss it? What is it?
Devin: So it’s Wyatt Jozwowski. Yeah, if you Google it, it’s the first thing. His LinkedIn profile is the first one.
Andrew: What is it?
Devin: Jozwowski, J-O-Z-W-O-W-S-K-I. You’ll see him, cofounder of Demio, LinkedIn.
Andrew: All right, and was it a 50/50 partnership that you struck with them?
Devin: Yeah, so that was the initial deal. He’s the one…
Andrew: Oh, Wyatt. I get it. I see. I was looking up Matt instead. Got it.
Devin: No, no. Wyatt is no longer with the company. We bought him out, so that’s why he is no longer here, but originally, yes, it was a 50/50 deal. You know, he has his other company, Demio, which has a great dev team. Obviously, networks communication software is not simple. So we basically just posted a job and then had his – I don’t even know what the role was, some sort of senior engineer – interview for us, but, I mean, it’s really not that difficult, guys. If you want to start a company like this, you just go post a job. You can use…what was the company?
Andrew: Toptal. We’ll talk about them in a bit, yeah.
Andrew: What did your MVP look like? What did your first version look like?
Devin: Oh, God. I thought it looked amazing, but it looked terrible.
Devin: Yeah, that’s what people need to understand. It got the job done. As long as something gets the job done and it fills the need that the market has, then you’re good to go.
Andrew: Take me back to when you first launched it. What was it about it that made you feel like it was great and why in retrospect do you think it was not very good?
Devin: So really, the thing that made it not really good is just the user interface and user experience itself. At the time being, it was good, but looking at it now compared to what we have, it wasn’t. It was just a little clunky. It was really colorful, and I think what we did was we built a software with a frontend, how the front of the software looked, how the shoppers saw it, I think we built something that would be pleasing to someone who wanted a SAS or someone who wanted a nice software experience. But for a shopping experience, I think we just didn’t put ourselves in the customers’ shoes. We were in our own shoes, so we had to realize that and remove ourselves from the situation.
But the reason why it was great still was because it solves two huge problems. One, finally people could have that nice mobile upsell experience, which is huge. We had people boosting their revenue by 20%. We had some guy. His name is Will. He runs a store. He’s like, “It’s not often you can account for an app to do 50% of your daily sales,” and I was like, “That is the kind of stuff that I like to see.”
Then, I mean, even with that version, we had a user. Our best user or our most profitable user of all time has done well over $1 million in upsells, and he did it with that really crummy UI that we had. So it goes to show that you don’t need anything amazing. You just need something that fills the gap, and then you improve it along the way. You don’t have to be an expert to start.
Andrew: I’m looking at how you guys promoted it first. Basically, what you’re saying to potential storeowners is, “Somebody adds only certain products to their shopping carts, and we will trigger an upsell.” The upsell will be a popup that is mobile-responsive, and it will have a button that says, “Select this or skip this product,” and if they skip adding the product, then you show them another potential product.
Devin: They’re carousels, yeah.
Andrew: One thing was a little different for me. I thought that part makes total sense. You add something. If I add shoes to my shopping cart, it would make sense that you might say, “Do you want socks with that?” Frankly, if you go buy a suit, they take you over and say, “Do you want to buy a tie at the store?” So it’s a total natural experience. What felt a little bit different for me was didn’t you guys also say, “You get a 35% discount if you get to $25 and you add that,” that bar at the top of the site, right? Talk about that. Where did that come from? How did you do it?
Devin: I was actually transitioning into that as well. So that was the [inaudible 00:28:34] kind of separated because no longer were we an upsell app. Now we added something called gamification, and basically, for those of you who don’t know, basically – “basically” multiple times – that means that it turns it into a game, right? Gamification. What we did, or at least what our goal was, was not only to allow users to make upsells for their stores, but we also wanted them to have a really high conversion rate on their upsells. We wanted people to buy it.
So our MVP didn’t have standard upsells where it just says, “Hey, you might also want this.” We only had the game version, which basically, let’s just use this as an example. It would say something like, “Spend $20 and get 10% off your order.” So now they’re spending more money, and they’re getting rewarded for doing it, which just created a fun and engaging buyer experience, and it was pretty cool. The bar would fill up as you, you know, added more to cart, and if you reached the goal, which you’re constantly getting closer to if you’re adding things to cart, fireworks would go off. It was fun. It was a good time, and we thought that it was just a really neat customer experience.
Andrew: Did it work?
Devin: Yeah, it works.
Devin: It worked. I mean, it’s different from store to store. A lot of the times, we would definitely work with our users and try to perfect their upsells, but we didn’t necessarily have a lot of time for that. Some people didn’t quite understand the concept of it, so some people had some issues, but those users who really knew how to set up an upsell and knew their target market and were actually doing the research were absolutely killing it.
Like I mentioned, we had a user selling…I don’t know. I’m not going to mention what they sell. I don’t want to give away their privacy, but essentially, they just had only one product in their store, one product, and they used images of people using the product in pairs. So it’s like, “Hey, buy one.” People would go. If they went to check out and they only had one in their cart, our popup would appear. “Hey, buy another one and get free shipping on both,” and then they would just use images. Their whole website was littered with social proof images that were of multiple people using the product, and they made it seem like it wouldn’t be a product you’d want to use alone.
And then boom, if they only had one in cart, hit them with the upsell, give them the incentivization, free shipping. I think they also ran a deal with a limited time where they gave them, like, 20% off, which is pretty crazy, but over the span of 7 or so months, because we track all the data, they did over $1 million in just upsells on it. It’s pretty nuts.
Andrew: So one thing that you guys were good about was showing people how much money they made from the product. Like, you’re wearing a t-shirt from Proof. I love the company. I’ve got the Proof product on my site. It comes up when you go to one of my sales pages and says, “Steve from Chicago just bought,” which is really powerful, but they don’t ever tell me how many more people bought because of it than without. So I can’t tell. Is it useful, or is it distracting? Don’t you think?
Devin: That’s a hard metric to track for them, I’m sure.
Andrew: Right, because they can’t A/B test it. Actually, I think they could A/B test it. They could say, “Hit this button. You A/B test. We’ll tell you how many more people buy when this on versus not, and we’ll tell you how many more people give their email address when it’s on versus not.”
Devin: Yeah, I’ll send them a recording of this, and we can charge them a couple thousand for the idea.
Andrew: I’ll tell them. I think I might’ve told them that too, but maybe they were drinking with me and so they thought I was just goofing around, but I think that’s important.
Devin: That’s usually what we would…
Andrew: If you’re helping somebody with a tool, you’ve got to say, “Here’s how much money I made you,” and not just give me data but give me data that’s actionable.
Devin: Yeah, and what’s really cool about that too is it can really improve. So for anyone out there who’s thinking of starting a software, doing things like that just improves user retention because it makes using your app fun. So we have normal things like the dashboard, right? You log into your dashboard and instantly you’re going to see how much money you made today, and then all you have to do is look. I mean, that right there is just going to show you the money. You know exactly how much money.
Andrew: In the beginning, even when your stuff was ugly on the backend, you had that. You would say…
Devin: Yeah, that was something we knew right away. So right away, people are going to know like, “Hey, this app made me this much extra money,” right? At first, it was a little different because we could only show how much people had added to cart, not how many people had actually purchased, but that just goes back to you don’t need something perfect to start if anybody’s worried about it, right? You just need something that works. Then we fine-tuned over time, and now it’ll have actual sales stats, and we can send people messages through Intercom saying, “Hey, congratulations. You made this much revenue today because of the app,” or, “Congratulations. You just made your first upsell.”
And what that does is not only are we gamifying it for their users, people who shop on their website, but now it’s kind of like a game for our users who install our apps as well because it’s like, “Hey, fun. I got my email today.” On the website, even Intercom will do that. So I get notifications daily from Intercom saying, “Hey, you got 100 new users yesterday. Congratulations, Devin.”
Andrew: I didn’t know Intercom did that.
Devin: Yeah, they do. It might depend on which plan you’re on, I’m not sure, or which of their services you’re using, not which plan. But yeah, and I look forward to that email every day. So implementing something like that is just a lot of fun, and it makes the whole experience that much better for you and your customers.
Andrew: Your first customers, you got them from where? Your list?
Devin: Yeah, we ran a webinar to our email list, basically. “Hey, come check out this groundbreaking tool that we have. You’re going to really like it. It’s a simple way to increase your revenue within five minutes.” We basically emailed the list a few times. Our first webinar did, I think, $65,000 in sales right there on that live webinar because it was awesome and people liked it, and then we’ve just been selling it ever since.
Funnily enough for those of you who are wanting to get into the Shopify space, I don’t know how it is now, but it takes quite a while for them to approve your app. I think one of our apps took nine months to get approved for their app store. So you can sell it off of the app store until then. I’ve had conversations with them about it. It’s like a gray area. They take 20% of your revenue, so it’s quite a bit, and they don’t necessarily want you selling off, but it’s a gray area since I talked to them about it. It’s like, “Well, I mean, they’re sending us users at the same time, so it’s hard to complain, you know?”
Andrew: And right from the beginning, you were sending people from what I saw directly to the Shopify store to sign up, right, and to buy.
Devin: Not then, no, because we were still in our approval process. So we were selling it. We wanted to put capital in the company, so we were selling it at a one-time price of $497.
Andrew: And that would give people lifetime access to the software?
Devin: Well, lifetime, I don’t even want to say that word here. Lifetime’s a word that I’ve been taught to stay away from. As long as the software is around, which we plan on keeping it around, they will have access to it.
Andrew: So it was a one-time purchase back then, $495 to get it, and then how hard is it to install a Shopify app or plugin away from the Shopify plugin store?
Devin: Oh, it’s so easy. There are these things called OAuth links. You literally type in the name of your store, click a button, and it installs.
Andrew: Oh, wow.
Devin: It’s the same process they use through the app store, and you can do it off the app store too because it’s pretty much the same process as setting it up for the app store except you embed the button on a different site on your own website or whatever.
Andrew: So were you at all concerned that you were building on this one platform that at some point they might decide to get into the space, they might decide to bump you or whatever?
Devin: This is a conversation we have quite frequently. Eventually, our goal is to sell the company just so we don’t ever have that looming over our head. Right now, what we are doing is building. We don’t actually plan on selling based on revenue, which is an interesting route to take. We plan on selling the company based on our customer list size and the amount of customer data we have. So that’s our goal because I’ll admit it is a terrifying thing. It could be so simple for them, right?
Andrew: What’s a horror story that you’ve heard that makes you worried?
Devin: A horror story? In our space, I haven’t heard too many of them yet.
Andrew: Shopify is pretty good.
Devin: I would say that one horror story, and it’s not necessarily a horror story – it hasn’t affected us too much, but I’ll admit that it was a pain for a bit – was there was this app called Oberlo. It’s probably the most popular app on Shopify. It was privately owned for a while by a company out in Lithuania, I believe, and what that allows you to do is basically import or fulfill products. So it would import a product into your store from a place such as Ali Express, and then it automates the fulfillment of its just via a Chrome extension.
Now, we were totally cool with being competitors with them, and then one day I wake up to Shopify sending an email out about them, and I was like, “Oh, man. What does this mean?” Shopify is all about fairness, and typically, they would never do something like that. Then news broke a couple weeks later that they had acquired them, and we have an app that does the same exact thing.
Andrew: SMAR7 Express.
Devin: Yeah, that would be SMAR7 Express. So that was kind of like a horror story for us for a little bit. We were like, “Oh, man. This really sucks.”
Andrew: That is one of the nightmare situations.
Devin: And then what we did was just build out different features that they didn’t have to try to separate us, and really, the biggest thing that we provided was much more competitive pricing. They have very good pricing as well, and it’s a good app. I can’t rag on it. It’s a good app. I think ours is better in different ways.
The amount of support and attention you’ll get from us is unparalleled, okay? Shopify has great support and stuff like that, but they’re a huge company, and at a scale like that, it’s a little more difficult, and we as a smaller company can really provide the level of support needed for new merchants and stuff like that.
Then we just compete on features in some ways. That’s our way around it, and it’s been our fastest-growing app still. It’s our entry level app. You know, our SMAR7 Bundle app is for people who are more established and already have revenue coming in. SMAR7 Express is to make people’s lives easier and, you know, help them get into the space. So it’s steadily growing. We’re getting a ton of installs on it, and we’re pretty happy.
Andrew: Okay. Your first customers came from that email list that you told me about. You do a webinar. You sell at a one-time price. You get an influx of cash that you’re able to use keep growing the business. How did you get the next batch of customers after that?
Devin: So from there we just experimented with Facebook advertising a lot, and I’ll be honest, it took about eight months to get it right. We couldn’t make it profitable for a very long time, and it was stressful. So this was another nightmare that we had, but luckily, this was something we were able to overcome as well.
We had all this money, and we’re spending it all on advertising, and we actually ended up going in the negative that first year because we spent all of the money on advertising and saw absolutely zero return. And honestly, it was just a lot of hard work and effort. We just kept testing. We were doing ads straight to our app listings or to our landing page on our website, which was basically an app listing.
It wasn’t working out, so we went a different route, and we started going through what we called our little indoctrination sequence first. I sat down in our office, and I’m like, “Well, what are we going to do, you know? How are we going to make these people stick around? How can we get more customers?” I was looking at different companies and what they do, and I was like, “Okay. We need to build just kind of like a cult following. This is what we need to do. We need to indoctrinate people within our brand, make them love us and be really personal with them and just help them out.”
So instead of marketing our apps, what we started marketing were free info products. I have a ton of them behind me. There’s a stack of them over there. It’s just these 20-page PDFs, and I print them out for the advertising. We give them away for free, and when people get in, then we soft pitch them on joining our Facebook group. Obviously, they have to enter their email to download the stuff. Our conversion rates were crazy. We were paying, like, 20 cents a lead for a long time.
We would have them join our Facebook group, and then we could constantly soft pitch them once they’re in there. Then we would soft pitch our apps in the free downloads as well. Then we would just upsell them other products, information products, after they downloaded our email. It’s pretty simple. I would say it’s a very typical marketing funnel.
Andrew: Sorry. Go ahead. I don’t fully understand it. You’re saying that you first said, “Look. Instead of trying to sell them the product right away, we’re going to get them to take some of our free content,” and then are you upselling them on the content?
Devin: So we also had more content that we would upsell them. I’ll go through it. The content that we would upsell them would be a Facebook advertising course. So let’s say what we did was we would give them a free PDF, right, and this would have 20 products that sold very well in 2015, right? Then we would list the products. We would list areas they can research that particular niche so they can learn types of words they could use if they want to promote similar products and stuff like that.
Then we would say, “Hey, you can also import this product into your store right away using our SMAR7 Express app. Hey, by the way, you know, while we have you, we’d love to give you more free training. Come join us in our Facebook group.”
Then we would upsell them after they downloaded that. We would be like, “Okay. So now you have all these great products, but do you know how to run Facebook ads? Here is our Facebook advertising course download.” We would have our partner, Matt, the one who runs ecommerce stores, we would have him create that little Facebook advertising course for ecommerce, and then from there we would upsell them on running or creating the store itself if they didn’t know how for $47. Then we would actually upsell them.
We looked at the lifetime value of our customers for SMAR7 Express. It’s a very entry-level app, so you only need it for a few months, right? It’s not something that lasts forever. It’s basically lead generation for us, and we only charge $7.99 a month for it. So we looked at the lifetime value of customers, and it ended up being around $60. Then from there we’re like, “Well, we might as well just upsell them a SMAR7 Express lifetime license. So we upsell that at $97 at the end, and that way we’ll make more money, and they never have to worry about canceling or paying monthly bills when they no longer need the app once they’ve outgrown it.”
What that allowed us to do is get a lot more customers, okay, because now people were not only installing apps but they were sticking around longer because they had the right information to allow them to actually harness the power of the apps. Now it’s not them just trying to run a store and not knowing what to do. They have the information that can help them, and they have the apps. And, you know, we’re essentially getting leads free of charge because we are only paying 20 cents a lead and then I think our average revenue per opt-in was, like, $1 at the time. Right now, we’re still profitable on these ads, funnily enough, and I haven’t even touched them, but it’s a lot closer to break-even now.
Andrew: What about your content marketing? It feels like that you guys were really good at.
Devin: That is something that’s always been a huge staple. That’s kind of what that is right there except it’s on a different medium. So instead of sending them to a blog post or YouTube video, we would just send them to a PDF. It was free, so it’s still content marketing, but one thing that we really took advantage of is actually…I’m looking at it now and I’m like, “Oh, wow. This is saturated compared when I did it,” but YouTube marketing was huge for us.
What people were doing was selling these courses, right, and they would charge you, like, $500 for them, and it would be like How to Create Your First Shopify Store. I was like, “No, no, no, no, no. No, no, no. We’re not going to sell this. We’re going to give it away for free.” And keep in mind it’s a very bare-bones version of it, but it’s a lot more than anybody else is giving away for free at the time. This is an hourlong video that I worked hard to prepare.
What was really great about it was it was full of soft pitches, but it gave them all the training they needed. This was at the very end of 2016. I uploaded a video to YouTube, and I wasn’t really thinking much of it. It was just How to Create a Shopify Store in 2017. So I release it in December 2016. It’s the perfect time because, you know, How to Create a Store in 2017, and it just took off. We basically walked people through the entire process of building their own online store.
We made it very simple to do, and the way that we taught them to do it was by harnessing our apps, and the truth is the apps make it so much simpler to do it that it made it seem so easy. All these people really wanted to get into it and really start to build their own stores, and the only way they knew how to build them was by harnessing our apps. So now all…
Andrew: And so you did this video to teach them how to set up a store, and in the video that I saw on YouTube, you subtly said, “And here’s how our app will help you do this,” and, “Here’s how our app will do that.”
Devin: Yeah, and a link in the description.
Andrew: And a link in description. You clicked over and did similar things on Facebook. Let me take a moment to talk about Toptal, and then I’m going to come back to you and say, “Despite all this, there was this one issue. Something happened with your girlfriend. Something happened with your business. I can’t believe that when things were going so well it almost fell apart.”
The sponsor is a company called Toptal. You know, I have had past guests say that the reason the Toptal has such great developers is because they make these tests really hard, and developers want to pass them, and by passing them they get to show the rest of the developer world, “I am one of the best of the best.”
So my guest said, “What’s the test?”
I said, “Well, the test is, you know, it’s on Toptal.”
He goes, “Can I take it?”
I said, “Not only that, if you pass it, I will give $2,000 to your favorite charity.”
He said that his favorite charity was Boys & Girls Clubs of America.
I said, “Great. It’s on.”
I contacted Toptal. They linked them up, and they said, “It’s going to be a three-step test process. We’ll let you know how things go each step of the way.”
This is the founder of a company that sold for I forget how many millions, I think over $100 million.
Devin: A lot.
Andrew: He was super enthused to take it. I checked in with him just yesterday, and I said, “How did things go? Where are you?” He goes, “Dude, that test is too long. I can’t do it.” So he dropped out of the process, and that’s part of it. Like, they really want to make sure that whoever gets into the Toptal list of developers has what it takes, has the chops to do it, and has the persistence to stick with the task and get the project done, because one of the problems with great developers is you can’t count on them being around. So that’s why he, frankly, didn’t make it in, which is fine. He’s got a business to run. It’s also why many other smart developers don’t make it into Toptal’s list of best developers.
Anyone out there who needs phenomenal developers should go check out Toptal where they will hook you up with people who have the knowledge and the persistence and the time to get through their test process, and then, if you want to work with them, Toptal will make an introduction and hope you hire the best of the best.
So the URL that is going to give you 80 hours of Toptal developer credit when you pay for your first 80 hours in addition to a no-risk trial period of up to 2 weeks is toptal.com/mixergy. It’s “top” as in the top of your head, “tal” as in talent, toptal.com/mixergy, and really be prepared. The first thing that’s going to happen is you’re going to get on a call with a matcher. Be prepared to tell them what you’re looking for. Talk it through. They’ll help you find the best person possible, and you’re going to find someone who’s got the stick-to-itiveness and the knowledge to get your code built and get your stuff built right. toptal.com/mixergy.
You know what? I muddle up the name Toptal because I talk so fast.
Devin: Yeah. It’s kind of a tongue twister.
Andrew: Yeah, Toptal, toptal.com. It’s not that hard when you see it, but it is hard when I listen to myself back. What about your name? I’m a little concerned that when I say to people they should go check out SMAR7 Apps that they’re not going to know to spell it with a 7 in place of the T. How has that been for you, SMAR7 with the number 7 as the T?
Devin: I regret it, but I can’t get rid of it now. The biggest thing is having to explain. I feel that our customers that we have now, they’re just so used to us that it’s not an issue, and I don’t think it’s ever really been an issue. It’s more annoying than anything when I hear people pronounce it the wrong way. My business partner, Matt, was doing an interview with Ezra Firestone, and my business partner called it “Smart Seven Apps.” I’m like, “Dude, what are you doing? Dude, you own part of the company. What are you doing, bro?” He’s like, “I got nervous. I didn’t know. I don’t know, man. The lights were on me.”
Andrew: You guys don’t own smartsevenapps.com. I’m going to buy it.
Devin: Yeah, we do. Oh, smartsevenapps.com.
Devin: Yeah, you have that. Put a picture of me and then just tell them to call me and just repeat the words “smart seven” over and over again.
Andrew: Let me see. Can I? Is it? I can’t. I can’t. You know what? I don’t want to buy it here. I’m going to tell you before this thing is published. You might want to go out there and buy it.
Devin: It was…
Andrew: Dude, it is. Yes, it is available, smartsevenapps.com.
Devin: Wow. Nobody who hates me has purchased that yet? You guys are slacking.
Andrew: What’s the deal? What happened with your girlfriend? Let’s get personal here, and then let’s talk about how it affected your company.
Devin: So it was actually a few things. It was a lot of things all at once, honestly. Hey, no hard feelings to her if she’s watching. She’s still in this space. She works for a great company now, but whatever. So she was kind of like our COO at the time, and basically, her and I went through a really bad breakup. When your COO who handles the day-to-day operations disappears just like that…and by the way, for anybody who’s listening, risky, okay? You guys know what I’m talking about. Business and love? Risky. But when they disappear after handling the day-to-day operations for so long just like that, dude, it sucks.
I didn’t know what to do. I’m like, “Okay. I can’t even remember how to manage my own business at this point because I’ve been direction for so long, and I’ve just been at the 1,000-foot view, right, while not actually doing things day to day.” That left me not knowing what to do, and not only did that happen, but we had a pending lawsuit against us as well. I’m not going to get into that too much.
Andrew: Give me just an overview about that.
Devin: I’m not even going to get into that one.
Devin: I want to stay as far away…
Andrew: It’s not public?
Devin: It’s not, no. It’s not. Nothing ever happened. It kind of all just disappeared, thankfully, but it was very stressful. It kind of sent me into a depression, I would say, all of these things happening at once, because, you know, I have my righthand man who is helping me with everything now gone, and now I’m stuck here dealing with this lawsuit. Then our cofounder, Wyatt, who founded the company with me, wants out because he wants to focus on his main company because it’s just so intense to work there, so intense that he needed to get his full attention.
So I’m left here, a guy who’s running a tech company. I don’t know anything about tech. I can’t write a single line of code, I promise you. If I want to embed an image, I have to Google the code every single time. It’s like , right?
Andrew: w3schools.com always has an answer to that.
Devin: Yeah, exactly. W3 Schools is exactly where I go. So I don’t know how to do that. I had forgotten how to manage my company because all project management, everything was handled, and that disappeared without warning. Then I’m dealing with this lawsuit too with some guys who have some more resources than I do, and it kind of hurt as well because I thought I was really good friends with those guys. But, you know, stuff happens. You know, so I’m trying to deal with all those…
Andrew: Why did you and your girlfriend break up? Oh, and I should say it’s w3chools.com. It’s plural. Otherwise, you go to a whole other site. Why did you and your girlfriend breakup?
Devin: Oh, she basically met someone else. Let’s put it that way.
Andrew: Oh, that sucks. Then are you doubting yourself at that point?
Devin: I don’t know. It was really affecting me. All of this really affected me. Let me tell you, man. I was super overweight. Right now, I’m a good 180. At that time, I was probably about 240.
Devin: It was all just really affecting me. It’s crazy. You’ve got to take care of yourself.
Andrew: That’s a huge difference.
Devin: Yeah, and it all happened in the span of, like, four months. It happens, man. You feel like you look away from the mirror for a second, and then, dude, depression hits you. These things happen, right, and then you’re eating Taco Bell every night, which is honestly what I was doing, and I don’t even know if I regret it. It was so good.
Andrew: When you were going through depression, what was it that you are feeling at the time? Like, “No one’s going to love me,” or what?
Devin: Oh, man. I just felt like I can never be successful. And here I am, you know? I’ve run multiple successful companies at this point. There’s no reason to get out of bed. I just felt so alone, honestly, and then it’s just the pending lawsuit thing, and I just felt alone, you know?
Devin: My business partner wanted out. That wasn’t even personal. That was just him taking care of his business, which I totally respect because when we initially built SMAR7 Apps, it was to build capital for our other businesses. Then it became more of a fulltime thing for me, and he still had his baby, right? So he had to go back to that.
Andrew: What was your other business going to be?
Devin: I don’t even remember.
Andrew: Okay. This was just a way to make some quick money to build the next thing.
Devin: Yeah, but then it became much more to me. I was too involved with customers and stuff, but yeah, I honestly just felt alone, and I didn’t want to be alone. But when you’re in depression, it’s kind of like a Catch-22 because I don’t want to do anything because I’m so sad, but I’m so sad because I’m not doing anything, and that’s tough, man.
The only way to really get out of it that I found was actually two things. Therapy is great, first of all. My buddy is actually starting a charity for men with depression. It’s a serious thing, especially in the business world. I feel that we’ve all been hit with it now and again. It’s unavoidable with the stress of running a business. It’s so lonely, and it can be so overwhelming sometimes because it’s hard to make sure that other people understand. A lot of the times people won’t understand, so you’re left dealing with things alone.
So therapy was a huge thing for me. It helped so much with just living my life again and then actually getting back in the driver’s seat of my own business. I had left my company without direction. It’s sad to say. I don’t even know what my developers were doing during that time. I really don’t, and I’m sure they were very bored.
Andrew: Were you guys making money at the time when all this happened?
Devin: No, because that was when we were still trying to figure out the Facebook ad stuff, and we hadn’t quite nailed down customer acquisition. All of our revenue was coming from these webinars that I had to do, but I had to be the salesman on those, and I was too depressed to even get out of bed let alone contact people to run webinars or even email my own customers to run a webinar.
Andrew: So did you do webinars or not? Did you give up on them for a bit?
Devin: We did a few, enough to keep the company afloat. I would say the company was losing money for sure. Our expenses weren’t that much back then, so we were probably only losing, like $5,000 to $6,000 a month, but when you only have $100,000 in the bank, I mean, that can only take you so far, you know? There were points where we had, honestly, like, $2,000 or $3,000 left in the bank because I had just been sitting there. I had not done a thing.
I was still trying. My developers were still building, and they still had ideas, and they were trying to build out those ideas and, you know, build amazing products. So we still had to keep paying them, and we had our expenses, our servers and all that stuff, and we needed designs and all of these things, which don’t come cheap, right, if you want good designs, good UI to give your customers a good experience because we were trying to improve everything. You know, I just got an invoice today for $2,500 for a simple banner. So, you know, those add up.
Eventually, I think it was probably, like, seven or eight months without revenue because I was just so down I didn’t want to do anything. We only had $2,000 left in the bank account, and we had just brought on a new CTO because I was like, “Dude, it’s time to turn around.” I started going to therapy, and honestly, this is going to sound kind of weird maybe to some people, but I therapy during the day, the mornings, work until 6:00 p.m. just at the office, me and my CTO grinding it out, we were the only two in the office, and then afterwards, dude, we just went out and partied, man.
Andrew: And partying helped you.
Devin: Oh, yeah. I got out. I met people. I met made friends.
Andrew: You started dating again?
Devin: Yeah, I started. I have a wonderful girlfriend who lives here in Austin with me now. I met her.
Andrew: Was that who was in your photo on Facebook, your profile photo?
Devin: Yeah, that’s my girlfriend. Yeah, she moved here with me. I actually met her out partying. I met her at a bar. I looked behind me, and I just watched this girl trip over guitar case and fall down. I went to catch her, and I didn’t catch her.
It sounds like this is like some sort of love story. She looks up at me, and I’m like, “Oh, it’s love.” No, I literally just turned around and went back to the bar. I was like, “I didn’t catch her” so I just went back to the bar, and then she walked up to the bar. She was like, “Do you mind if I come in here and order a drink?” I was still kind of, like, in a bad mood at the time, so I told her. I said, “I don’t give a fu- what you do.” I don’t know. I don’t know what language…
Andrew: You can curse.
Devin: “I don’t give a fuck what you do.”
Andrew: Because you’re feeling that depressed.
Devin: I was having a rough night, honestly. I had cried earlier that day about some work stuff, dude. I was so stressed out, and I was in a bad mood. Austin, who’s our CTO, chief technology officer, he left me alone at the bar for a couple of hours to go take care of some stuff. Dude, I was in a real bad mood. So I said that to her, and I guess she liked it or something because we’ve basically been dating ever since.
Andrew: Wow. How long is that?
Devin: It’s like a year and a half now.
Andrew: You know, I want to get into business, but let me ask you one other question that I’m dying to know.
Devin: For sure.
Andrew: Your dad kicked you out of the house when you were 17?
Andrew: Like, does that lead to your sense of loneliness?
Devin: Oh, man. My therapist told me so.
Devin: My mother passed away when I was three months old as well, so my grandmother raised me until my dad moved down. I was in kindergarten when my dad moved down from Michigan because I grew up in the Tampa Bay area in Florida. Then in sixth grade my dad moved back out to be with my stepmother and, you know, no hard feelings now or anything. Stepmom, Dad, if you’re listening, it’s cool. We’re cool. I love you guys. They moved out when I was in sixth grade, so it was just my grandmother and I again. At the end of seventh grade my grandmother basically approached my dad, and she was like, “You need to raise your son. I cannot raise your son for you. He needs…”
Devin: You’d have to ask her. She basically needed…
Andrew: Were you tough at that point?
Devin: I don’t think so. You know, I was a normal kid. I skateboarded, played Diablo II all day on my computer.
Andrew: We asked you in the pre-interview about how entrepreneurial you are. You said, “I don’t know about that, but I’ve got to tell you I’m not good at taking orders from people.” So I imagine this woman wasn’t even your mom and she’s telling you what to do. Was that tough?
Devin: Maybe. You know, it’s obviously kind of hard to remember. I’m just the kind of guy who didn’t want to go to school. I didn’t want to clean. I didn’t want to do anything. I just wanted to do what I wanted to do, right, which was play video games. So I’ve always been a guy on a computer. I’m here playing video games.
So maybe, but, you know, now that I think about it, I have no idea why that part of my life is such a blur. You’re probably right on that one because I do remember her saying that she couldn’t handle it anymore or whatever. Being that age, I was 12, 13. I think I was 13 years old. It was probably not a fun age for a single grandmother to raise by herself.
Anyways, so she made me move back in with my dad, and I was 13 then. When I was 17, my dad wanted me to do stuff around the house and stuff like that, and at that point, I was way too busy playing Counterstrike because, dude, come on. It was the glory days. I played competitive Counterstrike, and I wanted to play. So he’d be like, “Devin, you’ve got to load the dishwasher,” and I said, “Dad, I fucking hate you.” No. Then he kicked me out. So yeah, maybe.
Andrew: Because you were being so rude to him, and he couldn’t [inaudible 01:01:01].
Devin: Well, you know, it’s his house. I was a stupid kid. I should’ve listened to him, right?
Andrew: Did you have stepbrothers and sisters?
Devin: Yeah. Well, half. I don’t know. I don’t know the [inaudible 01:01:11].
Andrew: I don’t know what it’s called. Yeah, right. I guess half. So did he get along with them, or did he kick them out of the house too at some point?
Devin: Well, they’re so much younger than I am.
Andrew: Even to this day.
Devin: Yeah, my brother is about to turn 14, and my sister is 11. So back then, five years old. He may have not liked them, but he couldn’t kick them out, right?
Andrew: Okay. Still, don’t you feel like, “Look. You’ve got these other kids in the family, and me you toss out?” You didn’t have issues with that?
Devin: No. To be honest, my grandmother was so much…sorry, Grandma, because my grandmother’s definitely going to listen to this. My grandma, I am her golden child. She loves me. She talks about me every day. Honestly, it was so much. At this point, I did not want to do what other people said, and I knew that I could be that way with my grandmother because she was getting kind of old. I’m so sorry, Grandma.
Andrew: That’s okay.
Devin: I love you to death, but it was just easier to be there because…
Andrew: You knew you could get away with more stuff with her.
Devin: Yeah, I could go out and party. You know, I’m, like, a high-schooler, dude. “I want to go out and party and drink or whatever. I can stay up.” Because my parents would give me a bedtime at 10:00. “Dude, I’m trying to play Counterstrike. I can’t go to bed at 10:00.” So I could stay up until 4 a.m. playing World of Warcraft and Counterstrike and go out and party and do whatever and skip school, and that’s what I did.
Eventually, I sort of just dropped out because there was no parental…sorry, Grandma. I don’t mean to, but there was no parental figure that could make do anything because my dad was, like, just done. He asked me to come back, honestly, and I told him no. I was like, “No. I want to do what I want to do. I don’t want to see you.”
Dude, me and my dad are going to go golfing every week. I’m moving back to Florida soon, and we’re going golfing every weekend. The relationship is great now. It’s just the two of us…
Andrew: How? How do you repair that?
Devin: How do I…
Andrew: How did you repair your relationship with your dad?
Devin: I don’t know. I actually had an ex-girlfriend, and this was a long time ago, who couldn’t quite understand either, and I’m just like, “You know, he did what he had to do.” I don’t know. Well, my therapist told me that, essentially, I just don’t deal with things because it’s easier. So I just throw it all to the side, and I’m like, “Who cares? It happened.”
Andrew: “I’d rather,” you’re saying. Right.
Devin: And now I…
Andrew: “If I could just move things to the side and ignore them, I’d rather do that.”
Devin: Yeah, so that’s essentially…
Andrew: So that’s when you ended up going to work with this pick-up artist blogger. That’s how you learned SEO. That’s how you got yourself on your feet without a college and high school education.
Devin: Yeah, I just saw an opportunity, man. That all happened when I was 19. I dropped out when I was, I don’t know, 17 or 18. I only had a few months left of high school. I don’t know why I dropped out. I don’t regret it at all. Would I recommend it to anyone else? It’s like, “You might as well get it, I mean, if you’re that close anyways.” Wyatt, the guy who I built SMAR7 Apps with, dropped out of high school as well, and he’s the smartest guy I’ve ever met.
Andrew: I wish I had dropped out. I wish at some point in high school I would’ve said, “This is bullshit. You guys aren’t really teaching me anything. You’re here to babysit me. I’m learning so much more on my own. I’m dropping out of the system.”
Devin: It’s nothing useful, but what people need to know is if you are going to drop out, you can’t just expect magic to happen. You have to get out there and put forth effort, and you still have to learn. [inaudible 01:04:12].
Andrew: It is very, very difficult for it all to be on you. The whole framework of your life is on you. What school does give you is a really nice framework. You have to show up at a certain place. You have to do something. When you don’t have that, it’s tough.
All right. Coming back to present day, the thing that really allowed you to go even bigger than you were when we first asked you to come on here is this partnership. Talk to me about what the partnership is and how this new product sales approach has come together.
Devin: Okay. So it wasn’t necessarily supposed to be partnership. It’s kind of funny how it worked out. SMAR7 Apps for a while, you know, I told you that selling content really helped boost our revenue, and back then it was just in the form of a PDF, right? And we still do that because it’s lead generation. We’re still going to generate leads. We’ve got to do it nonstop, right?
What we want to do at this point, we’re like, “Okay. We are tired of selling these small courses. Let’s build this master course, and we’re going to call it SMAR7 Commerce.” We’re going to charge $2,000 for it, and it’s going to come with education and all of our apps. So this is an amazing deal because you have to realize that just for lifetime access to SMAR7 Bundle, SMAR7 Bundle is $47 a month. So for lifetime access to it, we charge around $997. Here we’re saying, “We’re going to give you all of our apps, including future ones that we have in the pipeline, and you’re going to get training, and you can get access to, like, this Facebook group and all these great things, and we’re only going to charge $2,000.”
So in our mind, this was an absolute no-brainer, and we spent, like, gosh, like, a year working on it because we really wanted to build something perfect, and by all means, guys, that was probably a mistake on our part, and I want people to realize that building an MVP that you can just sell and improve in the long run is much better. It’s better to just get it out there. It doesn’t have to be perfect, but for some reason we got really hung up on it. We spent, like, a year making it.
By the time it was done, we saw someone else selling courses, and it was a good friend of mine. That’s basically Market Hero. So this company, we saw them selling an ecommerce course, and they’re not even in ecommerce. They just partnered up with someone to create a course, and they were selling it. I’m like, “Dude, look. This is cool, you know? He’s got this great gig going on, but we can bring an awesome deal to him.”
So I approached him, and he said no, and I was like, “Oh, well. We’re just going to keep moving forward.” I probably pestered him about it a few more times because we’ve always been good friends. Eventually, he just randomly messaged me one day, and he’s like, “Devin, I want to sell your course. I want to sell your course.” I was like, “Oh, cool.” So it was a long process to even set that up. It probably took us three or four months because, oh, man, was there a lot of legal work involved in making sure that both parties will be happy.
Essentially, what’s going to happen is he builds the product, okay? So he builds a product, and this is what we call H-com 2020. That’s our course. It’s basically just a membership site. So he built a membership site, right, and then what we did was license him all of our content and apps so he could put it inside of the membership site. The website he owns. The stuff within the website, we own it.
Then all we have to do is take care of the course, make sure it stays up to date, make sure the customers are taking care of and happy, make sure we can fulfill any requests he might have, and then run sales webinars with him. Then what he does is handle all of the sales and marketing of it. So it was a pretty big no-brainer for us because we could have by all means done this on our own, and we probably would have done really well, but this was kind of a quick-start.
Actually, we were in a pretty good spot at this point because this was about a year after our big issue where we were almost net zero in the bank account. But we just wanted to get it off the ground because we had spent so much time working on this, you know, like, a year. We didn’t want to have to figure out how to sell it perfectly and do all that, and we wanted to partner up with a company that had the resources to make it huge quickly, and by resources I mean capital.
Andrew: How much is he selling it for?
Devin: So we’re selling it for $2,000 now, and we literally just run a ton of YouTube ads. We spend anywhere from $10,000 to $40,000 a day on YouTube ads.
Andrew: A day?
Devin: A day, yeah. If you’ve ever gone on YouTube and seen Alex Becker with, like, a sewing machine or something or talking about a Shopify store, yeah, that’s us. We run…
Andrew: But he’s buying the ads? He’s making…
Devin: We split. He buys the ads and stuff, and then, at the end of each month, we split the revenue and ad costs.
Andrew: Okay. So I’m looking at it. It seems like it’s basically all your stuff. He’s just selling your stuff.
Devin: Yeah. It’s just our content, and within…
Andrew: Your software and content, he’s selling it. You’re creating it and maintaining it and talking and helping him sell it, and you guys split the revenue and the costs.
Devin: Yeah, exactly.
Andrew: And the revenue is split 50/50 also?
Devin: I’m not to get into the split.
Andrew: Can we say if it’s more heavily weighted towards him or towards you?
Devin: It’s slightly more towards him.
Andrew: Towards him. I would imagine because dude’s doing a ton here. And then how much is Market Hero? It’s on the markethero.io domain, which is his site, right?
Andrew: I know Market Hero the software is involved. How much is he bringing in from Market Hero to sell this?
Devin: We only launched in November, and I think our revenue is somewhere around…I haven’t looked at the exact numbers, but it’s $4 million to $5 million gross, and I would say about $750,000 of it is directly from Market Hero without advertising.
Andrew: From his customer list.
Devin: Yeah, from his customer list, and then we’ve done a couple hundred thousand dollars from our customer list, but what we found is, I mean, advertising is key. Affiliates are great. Selling yourself is great, but you can’t scale those. You need to be able to scale ads, and that’s what we focused on.
Andrew: And Alex is really good at it.
Devin: Yeah, he’s done a great job. We work together to build really great sales pitches, really great products. I mean, everything came together. The man knows how to sell on YouTube, which is great. We spend $4,000 to $5,000 a day on Facebook, which I would like to really master more because I see some of our competitors doing really well on Facebook, but the numbers that we get on YouTube we’re more than happy with.
Andrew: So part of your thinking was, “Let’s sell a course.” Then you started adding the software to it. Why? Why not say, “The course is going to be a standalone thing, and then we will upsell them on software?”
Devin: We just wanted to have everything in one place. We don’t want people have to worry about it. It would make sense. If we’re looking at money or revenue, it kind of makes sense, but our main idea here was it was never even about the course itself. The course was a means to an end to get people to install the apps, but the whole idea was, “Let’s look at the lifetime value of our customers. Let’s multiply it by however much. Let’s set that as the price point. Let’s include the apps, and let’s go.”
This way, we’re going to multiply our lifetime value no matter what, and we don’t have to worry. From the advertising, since we’re spending so much money, like, we generate probably anywhere from 2,000 to 4,000 leads a week from it, and we’re still selling our apps to these leads, right, because only so many people buy the course per day, right, like, three sales per day because it’s an expensive course, but we still get hundreds if not thousands of leads in a day. Probably some days it’s not definitely normally 1,000 leads in the day, but we still have those people to sell our apps to, so it kind of works out. Our idea was just, “Let’s just improve our lifetime value, and let’s get it up front.”
Andrew: Yeah, you know what? It makes so much sense. I told you before we started. Neil Patel told me that marketers need to do that. Figure out what the lifetime value of a customer who pays monthly is and just charge that, and you’re saying, “I’m charging that times a multiple because I’m also including the course.” That makes so much sense, and still, it’s so hard to accept because the benefit of SAS is supposed to be lifetime payment coming in.
Devin: Yeah, look. I’ve done both. They’re both great. It would be nice to have.
Andrew: And you’re still doing both.
Devin: Yeah, we’re still doing both. Our SAS revenue is $70,000-ish. It fluctuates each month. Our growth has actually been…I was looking at it earlier today. This month has been stagnant for the past month, but it’s because we’ve shifted focus. I mean, that’s no longer a huge focus for us anymore.
Andrew: Selling on the app store is no longer…on the Shopify app store. All right.
Devin: We’re going to hit it again soon with our upcoming apps, but right now, the course is doing so well for us. We’re helping out so many people. We’ve got so many amazing success stories, and it’s just a lot of fun. So that’s all we’re worried about right now.
Andrew: All right. I should say I talked barely anything about the apps themselves. I just think that the apps are beautifully done. We could’ve talked the whole session here. I think the Intercom guys, they have some kind of podcast with great product creators. I think those types of people could do a great job describing how well this app is put together. That’s not me. I’m really glad that we got to talk about how you built the company. That’s what I’m excited about.
Anyone else who wants to check out the apps to see for themselves what it looks like, you just go to smar7apps.com, and remember that the T is actually a 7, so smar7apps.com, and if you click on Shopify Apps, it’s going to take you directly to the app store on Shopify where you can see there are three apps and see their five-star reviews for every single one of them.
I’m such a scumbag that I look to see who’s the person who had something negative to say, and there just wasn’t any. It’s like there literally is one person from each of these apps who had one star. You know what? It’s not that I’m a scumbag. I always worry, “Am I about to get snowed by a guest?” Because frankly, you’re a good marketer. You can snow. You can snow someone. I don’t want to be snowed by them. I see a lot of other podcasters who have people on who claim to be magical entrepreneurs who have done great. I do my heavy research on them over lunch. I go, “What the fuck are they doing? This guy has nothing.” So I do go in and look to see who was the person who had a negative review, and so far it’s like one dude here and one dude there.
Devin: I think we have over 1,000 reviews, and I think overall there are, like, 7 or 8.
Andrew: I’m going to see what the negative review is. You know what? Just like Conan does a negative tweet with celebrities, I should have creators read one negative…
Devin: I will tell you I have nightmares about these things. It’s so frustrating because we have access to all the data like how long they used the app for and stuff like this, and I can promise you this. Every single 1-star review we have, and it’s probably true for most app companies out there, they’ve had it installed for 5 or 10 minutes. It didn’t work. My developers will message me on Slack so pissed off. They’re like, “What?” It’s just so frustrating for these guys.
Andrew: Your review, I’ll read it to you right now. “One star but only that because I cannot leave a review unless I click a star. No rating as installed app didn’t work. Asked for help twice and still not working, so deleted.” So for some reason, they weren’t able to install the app properly or get it to work.
Devin: Oh, man. It’s the things like that, and then you look, and they never put in a support ticket and stuff like that. They’ll email, like, email@example.com or something, you know, and we don’t see that for a few days because that’s just our PayPal. We don’t check it, right? Oh, God.
Andrew: I feel like all these app stores need to do a better job of that. Apple on their app store lets developers respond.
Devin: That’s what I want.
Andrew: I got an alert so I could respond. I couldn’t even freaking find out where the response was from the developer. They tried. Oh, I see you’re angry. I shouldn’t have ended with this. You know what one of my interviewing coaches said? Do not end with a harsh question. The person then only remembers the tough question and thinks that you’re a jerk, and this is why people complain and want their interview pulled down.
Devin: There’s one thing I think, let’s say. Shopify, if you’re listening, please let us respond to reviews. We want to help our customers, and by allowing us to respond to reviews, we can get in contact with them better, because sometimes there’s no way to get into contact with them. You can go on the developer dashboard, and you can see, like, phone numbers or emails, but sometimes there’s absolutely nothing there. So we can go to the website and contact them, and they never respond because a lot of ecommerce storeowners apparently don’t monitor their emails. Our head of support will just follow up with them nonstop. He’s like, “We’ve got to figure this out, Devin.”
Andrew: I love how upset you are at this because I like [inaudible 01:16:54].
Devin: If there’s something we’re all [inaudible 01:16:56]. I think we want our customers to be happy, you know? I want to clear it up for them, and it’s huge for me because this is the best way to improve our UX and our user flow, right?
Andrew: To understand when someone can’t install it.
Devin: It’s finding someone who had problems and getting them to talk to us, and it’s so frustrating. Sometimes it’s the best when they have their phone number up. When they have their phone number up, I’ll give them a call. They’ll get so excited that I’m calling them, and then we talk. We figure it out, and it’s usually so simple, but, you know, some people just…
Andrew: With Shopify, anyone who leaves a review has to leave their store essentially in the link, and so I can see one of them. If they don’t have their phone number on the store, you can always go to…let me try this one person if I go to whois.com and then I put in the domain name. Do you ever do this?
Devin: Yeah, sometimes, but usually, they run a store with Shopify, and Shopify is a registrar of domains.
Andrew: Right, and then you can’t…there we go. This one’s registered with Google Domains, which means they get the privacy so you can’t even contact them. All right, that is a headache. I get it. I wish I could end on a positive note.
I will say this. Anyone who wants to go check it out can actually see all your reviews, and they’re going to be pleasantly surprised because you really do have five-star reviews for everything you have, and the apps are really freaking clever. I like the way that you’ve put this together. I’m glad that you’re here to talk about your business. Congratulations on getting Logan Paul as a client, his store and so many other well-known stores.
Devin: Hey, yeah, that was a very exciting time for us, actually. That was a very exciting time.
Andrew: You know what? I dig his stuff too. I know I’m not supposed to say that I dig it, but I feel like the Paul brothers do good stuff.
Devin: Man, I was…
Andrew: Not good stuff for the world. They just create compelling content. I don’t think [inaudible 01:18:27].
Devin: [inaudible 01:18:28]. I was basically unfamiliar with them until I was informed that Logan started using the app, and I was like, “Dude, this is huge. This is huge.” Then we did a really special onboarding process just for them. We got on with the guys who run their ecommerce stuff. Normally, we don’t get that involved. We gave them a direct line to the developers, and then I think we had, like, an SSL issue the day that they installed it. It was a nightmare. I was out at a bar, actually, because it was, like, 8 p.m. It was just a few days before Black Friday, and I’m like, “Austin, why are the developers not responding? What are we doing? Why don’t we have an emergency phone line for them? I don’t get it.” I was like, “Austin, everything is ruined.” It’s not even, like, a ton of revenue, you know? We don’t do…
Andrew: You don’t do percentage.
Devin: Yeah, we don’t do percentage, and we don’t do, like, enterprise packaging or anything. You know, he pays the same amount as everyone else, so it’s not like it’s really losing us a bunch of revenue, but the fact that we had the largest store on Shopify using it, it’s like, “Okay. We’ve got to make it work for him.”
Andrew: All right, smar7apps.com. Don’t forget to use a seven for the T, and I want to thank my two sponsors for making this interview happen. The first will host your website, right? It’s called hostgator.com/mixergy, and the second will help you hire your next phenomenal developer. It’s called Toptal.
Think about this. How many businesspeople, by the way, like you have this idea for another piece of software that they need for themselves that they know they can do without other people? They don’t have the bandwidth. The team doesn’t have the bandwidth. They end up going to Toptal. The Toptal people build the software for them, and they end up with this new line of revenue kind of like you guys did. It becomes a major thing.
Go toptal.com/mixergy, everyone, and thank you all for being part of Mixergy. Oh, boy. I spent so much time with you. Devin, I told you before the interview started by email and by text. I told you I freaking love your story, and I’m glad that I got to tell it here. Thanks for staying on with me.
Devin: It was a blast, of course. Do you mind if I say something about Toptal, by the way?
Andrew: Oh, yeah.
Devin: I just want to say, guys, I do want to shout out to all inspiring tech entrepreneurs because, dude, I get it all the time. “Hey, I have an app idea. I have an app idea,” and they want me to do something for it, and people don’t seem to realize, like, I’m actually pretty busy. I don’t have time to help with your app idea. But guys, a place like Toptal is where you would like to go because if you were to go to a competitor, which I’m not going to name – dude, why would I – but they don’t have the same vetting process, and you can get screwed. In the past, I mean, before I have run SMAR7 Apps, I tried to launch a tech company by myself. I used a competitor, and I hired some really bad devs, and I lost $40,000 and had absolutely 0 things to show for it.
Andrew: Oh, man.
Devin: That’s what got me into philosophy and stoicism, by the way, geez, because [inaudible 01:21:10]. But, you know, you go to a website like Toptal, and their vetting process is so in-depth. It’s really going to be huge for you, and it will allow you to keep from making those same mistakes that so many people make. Just go to a place that will get you those good, good devs and not worry, because if you don’t know how to code or anything, it’s going to be hard to interview. So that’s a place that will really save your life.
Andrew: Yeah, yeah, that’s one of those places where you don’t want to skimp. All right, toptal.com/mixergy. Thanks so much for doing this, Devin. I hope we’ll get you back on here again.
Devin: Yeah, man. It’ll be a blast. Thank you so much for your time. I appreciate you have me on.
Andrew: Right on.