What is it like to become a first-time software founder?

We read a lot about entrepreneurs who are building SaaS companies and Ethan is someone who said, “I’m going to jump in and try it out.”

Ethan Sigmon is the founder of SocialInsight.io, a software that helps you manage your Instagram marketing.

I want to talk to him about what it was like to become a first-time software entrepreneur. It wasn’t as easy as it seemed and it wasn’t a disaster either. It was a story that’s a lot more common and I want to learn from it.

Ethan Sigmon

Ethan Sigmon

SocialInsight.io

Ethan Sigmon is the founder of SocialInsight.io, a software that helps you manage your Instagram marketing.

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Full Interview Transcript

Andrew: Hey, Everyone. My name is Andrew Warner. My name is . . . I say it twice don’t I? I know what it was, because I was thrown. I’ve been trying to say, “Hey, there freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy where I interview entrepreneurs about how they built their businesses.

You know, for years, Ethan, I said, “Hey there freedom fighters.” Because I was in Argentina and people admired Che Guevara in the U.S., but in Argentina, they admired the kinds of entrepreneurs I was interviewing, because they’re the real freedom fighters for people in Argentina. They’re the ones who are really going to free them of all the crazy government regulations they kept them from participating in the world. You know, all these entrepreneurs creating apps that were connecting them, creating software that was giving them access, creating ways for them frankly to get paid by people outside of Argentina.

Anyway, for a long time I stopped saying it because it felt a little gimmicky, and then I noticed in talking to people, this is something they connect with. This is what they want. Freedom for themselves, freedom for their audience, so I’m bringing it back.

Ethan: Yeah, I like it.

Andrew: You do?

Ethan: Yeah. It brings a sense of community.

Andrew: Yeah. I don’t want to gimmicks, but I do fine. This is a couple of words communicating a message that’s really important to me. All right. The person you hear on the screen is a guy who I was introduced to when I did an affiliate deal with Johnny Lee Dumas. John Lee Dumas had me on to talk about our chat business, and it was an affiliate deal, so every time I talked to his audience about it and people bought, he got a commission and I had these partnerships with other people. But dude, John Lee Dumas, the more I get to know him, the more I’m impressed with him. Usually the more I get to know people, the more I feel like, “I now see the facade, it was just fake.” With him I see, “Wow, this is like such an interesting, smart thinker there.” He started buying Facebook ads, and other ads to promote the webinar I was doing for his audience, so that he could then help me sell more, which would increase his commissions, just amazing.

So I asked him to introduce me to the person who bought his ads, and he said, “I don’t usually do this, but I will in this case.” And he introduced me to Ethan Sigmon who I’ve gotten to know over the last year or so since that introduction. Again, Ethan’s another one of these people who is smarter. The more I get to know him, the more I realize how smart he is. It’s not that you are smarter Ethan, the longer I get to know you. It’s that I get to see it.

Ethan: I hide it well.

Andrew: You’re kind of quiet. Aren’t you?

Ethan: I like to . . . I take a reserved approach. I feel like I don’t want to put people off by coming out and trying to sound like I know everything, or overstepping my bounds. So I kind of sit back, and if there’s a problem that I think I can help with, then I’ll hop in, but yeah. I am somewhat quiet in that sense.

Andrew: Well, he’s been buying our ads and helping us more than that, helping us also figure out what the business model is behind Bot Academy, this place where we train people to create chatbots. And as I’ve gotten to know him, I also got to know some of the backstory that he’s had, which is that he had this software company called SocialInsight.io. It’s a software that helps you manage your Instagram marketing. And I wanted to have him on here to talk about what it was like to become a first time software entrepreneur.

You know, we read a lot about entrepreneurs who are building SaaS companies, we hear them here on Mixergy. This guy who said, “I’m going to jump in and try it out, and I want to find out what happened. It wasn’t as easy as it seemed, it also wasn’t a disaster. It was a story that’s a lot more common, and I want to learn from it. And I want to find out about his new chatbot platform. Actually, do you guys use chatbot, or you call it messenger marketing platform?

Ethan: I call it messenger marketing platform, yeah.

Andrew: Makes sense. The company is called Opesta, it lets you reach people in the app that they love, which is Facebook Messenger. But what makes his software different is it’s got smart marketing automation.

All right, this interview is sponsored by two great companies, the first is Needls. If you need somebody to buy your ads for you and you can hire Ethan, you should check out Needls, it’s N-E-E-D-L-S. And the second is going to help you reach people via email. It’s called MelShake. I was going to say milk shake, it’s MelShake. I will tell you guys more about all those later. Ethan, good to have you here.

Ethan: Good to be here, Andrew. I’m excited.

Andrew: How high did you get revenue up at SocialInsight.io?

Ethan: So revenue at SocialInsight it peaked and valley-ed, but right last year the end of 2017 was probably our best year, and we were above 150,000 in annual, but below 350,000. So right in that range.

Andrew: That’s a pretty big range. You’re basically doubling it. Was it around 200,000 revenue?

Ethan: Yeah, right in there.

Andrew: How much of that was profit?

Ethan: Profit is actually pretty good on it, I would say after paying developers and everything like that, probably sit about 50% of that. That includes paying myself a small salary, and things like that, too.

Andrew: You mean, after taking a salary it’s a hundred?

Ethan: Mm-hmm, yeah.

Andrew: And you started this thing just about a couple years ago, 2015. I’m shocked, because frankly when you talk about it, you talk about it like this quiet thing that happened in the past, that you had a lot of headaches and agita with it. I had no idea it was doing well.

Ethan: Yeah, it’s doing well, and if you would have . . . I guess we did meet about a year ago, but if you would have met me a little bit before that when it was really like in its infancy, and I was really, really excited about it, I think the conversation would have been different then. But as it evolved and things like that, I think this actually happens to a lot of entrepreneurs. You have this vision of what you want, and then once you kind of get it, you maybe realize like, maybe this isn’t exactly what I wanted. And that’s kind of what happened with SocialInsight, and so, it kind of . . . I just kind of let it plateau, and it’s been a nice kind of passive thing, but I kind of spend my energy and focus on the other things that really excite me now.

Andrew: I want to understand what you wanted it to be, and what it ended up being. But let’s go back a little bit. You’re a guy who was an insurance agent, is that right?

Ethan: Yeah.

Andrew: I laugh as I say that.

Ethan: Yeah, I was an insurance agent for American Family Insurance . . .

Andrew: You know why I’m laughing as I say that? Because insurance agent reminds me of the guy who’s dressed up in a suit, who has to look responsible. You’re a guy I don’t think I’ve ever seen you outside of a T Shirt . . . Frankly, I haven’t been outside of a T shirt lately, and your hair is super long. What’s with the hair?

Ethan: I just have always wanted to grow it out, and now that I’m not an insurance agent, I don’t have anybody that’s going to mention it, and so I can do whatever I want, and I grew it out, and I actually, I liked it long. So I have been keeping it there for a while. To be honest though, the reason I started it was I was so busy working on social insight that I would never make time to go get a haircut. And so, then after like six months, it’s like, “Well, I might as well just grow it out.” You know what I mean?

Andrew:So, it’s funny. You know what? I’m kind of like that with buzzing my hair. I hate that I have to go get a haircut. I hate that have to sit there. By the way, I found someone who lets me listen to podcasts and audio books which makes it a little bit more bearable, but I’d rather just go in the shower, buzz it and move on with my day.

Ethan: Yeah.

Andrew: All right. So you’re at American Family Insurance, they offered you a $250,000 grant to do what?

Ethan: To start my own kind of agency. So the way that they work is every insurance agency company is a little different, I guess. But the way that American Family works, is they won’t hire you into a full insurance agent position right away. Essentially, what they hire you into is called an agent in training position. And they take an established agent that already has kind of a location that does well, they place you in his office for a year to three years depending on how fast you are and things like that. Then after that they basically say, “Okay, yeah. You’re good enough to work for as an agent on your own,” or they let you go.

Andrew:And so you got that offer, and you decide to do what?

Ethan: Yeah, and so they offered me that, and the whole time I enjoyed insurance because nobody was breathing down my neck. It’s sales. As long as I’m hitting my quotas, things like that, and since I’m my own boss, I can come and go when I want. But I wasn’t really passionate about it, and I had always really been passionate about online marketing, and I knew that that’s what I wanted to do long term. I never wanted to have a career as an insurance agent.

Andrew: How did you get excited about online marketing?

Ethan: You know, I found Noah Kagan, and I found AppSumo, one of my buddies just . . . We were at my house one night talking, and he was saying, “Oh you should check this stuff out. I think you might think it’s interesting.” And so I started checking it out and reading more, and I just started reading Noah Kagan’s. I guess he still updates it OkDork.com and that really is what first turned me on online marketing. And in my biggest regret in life is that I didn’t know about that like five years sooner, that I just didn’t know that there was this whole online marketing community that was there and once I found it I was completely engrossed in it. And I just knew that that was what I wanted to do in some way, shape or form.

Andrew: Yeah, because, you know what? You seem like you didn’t know as much. You weren’t exposed as much entrepreneurship as I was growing up, or other people who might be listening. In fact, you said, look, my dad was far from entrepreneur, my parents were both into real estate, but still you had these little moments of entrepreneurial desire or experiences, like you were to swap meets with your dad. Do you remember that story?

Ethan: Yeah, yeah. So my dad is really big into building hot rods. And so part of that is you go to swap meets and you try and find some different parts that you need, things like that. And any time you go to a swap meet or flea market, or anything like that. People just sell random stuff. So mostly at the swap meets is car parts, but other times there is other random stuff. And one time I went a guy was selling a candy machine, just like a little like a 3-tower vending machine that. You know, nothing fancy. You would see it like old gas station or something. And I thought it was the coolest thing, and it was like, it’s $50 I think from what I can remember. And I just thought I want to buy this because I want to have a candy machine in my room, so I can always have candy. That’s how I thought it worked.

If you owned a candy machine, you just get free candy all the time. And so I have worked since I was in fifth grade, so at the time I had some money, and I kind of bought it. And then I realized that you don’t just get unlimited candy once you have this candy machine. And I’m kind of the type of person, this is how I’ve always been. I never want to admit that I did something stupid. And so at that point it’s like you have two things that you can do, you can think, “I just blew 50 bucks.” Or I can figure out how can I make my 50 bucks back from this thing that I wasted $50 on? And so I just figured, “Hey, why can’t I put this candy machine somewhere, and I’ll just go to Costco and buy candy, and put it in it.” And that’s what I did. I ended up getting a location that I could put it, and it did a lot better than I even realized was possible.

Andrew: You know, a candy seems like a really good entry point into entrepreneurship. Every school should just give their kids candy and say. “Now, go figure out how to make money with this.” Or, “If you eat it yourself, then maybe you discover something about yourself, too.” Maybe you’re not an entrepreneur and you should learn that now.

Ethan: Yeah.

Andrew: All right. So you discovered Noah Kagan, you said, “I’m going to try this stuff.” And the first thing that you did was, a done-for-you landing page service. What was that?

Ethan: Yes. So the first thing that I did . . . Well, the first thing that I actually made money from, I tried a lot of stuff that didn’t make any money.

Andrew: Like what? What are some of the things you tried that didn’t make any money? Selling candies [inaudible 00:12:04]

Ethan: I’ve made a couple of apps. So I made a few iPhone games that some of my friends played, and I thought, “Oh, I can monetize those through ads, because this was back in like 2011 or 2012 like right around the time of Flappy Bird and things like that where it was like, “Oh, apps are big.”

Andrew: How do you make them big? By the way, just watch the bang on the table, because your mike is picking up every one of those sounds. How did you make those apps? You’re not a developer.

Ethan: Yes. So I figured out that you could actually go and you can find frameworks, and you could buy these pre-made frameworks, and then all you have to do is modify them slightly, if you want, or some people just buy, create completely just different graphics, and all they’ll do is swap the graphics out. And so I started buying a bunch of different framework, the things that I thought would be interesting, and then it’s just a matter of who markets it better, right?

And so, I did a few of those, and maybe spent a couple thousand dollars messing around on stuff like that. Let’s see, I tried to . . . I’m trying to think of some of the other stuff that I did. It’s been a while. I made . . .

Andrew: All right. Let’s go to the one that made money.

Ethan: Yeah, so the one that made money, what I decided to do is, before I was in insurance, I also had my real estate license. And I kind of was trying to do commercial real estate, but it didn’t work out. And so, I didn’t want to do residential, and that’s kind of what led me into insurance. But before that, I knew that residential real estate agents really wanted to figure out how to get new buyer and seller leads. And this was right when Facebook ads were getting popular, and things like that, and so I was reading all these stuff with Noah Kagan and understood landing pages, and how to push Facebook ads, and that’s how you could actually get a lead and things like that. And all these things that real estate agents didn’t really understand, because, I think the median age for a real estate agent in the United States is like 47 years old or something like that.

And they really didn’t want to embrace new technology. So what I did, is I kind of just . . . I took a Leadpages account, I created a bunch of templates for real estate lead generation of buyer and seller leads for different landing pages, and then I mocked up a bunch of ads, and I just ran this free training that said, “Hey, I’m going to show you how to generate leads through Facebook for buyer and seller leads, targeted real estate agents.” And at the end of it, I sold them these templates. I said, “Hey, for $29 a month, you can get two active landing pages that are kind of managed for you, and all I was doing was going into Leadpages and swapping out images, and then, when somebody opted in, we just made it so that the lead notification went to them. And so I built a SaaS on top of Leadpages. SaaS essentially and just marked it up. And . . .

Andrew: How did that work out for you?

Ethan: It did pretty well. I mean, at the time, I would have . . . if you would have talked to me when I did it, I would have been ecstatic. I would have been like, “This is the coolest thing. I’m making so much money.” I think I got to the point where I was making like a $1,000 a month. So nothing life-changing by any sort, but I had never made any money online, and it was cool to be able to do that, and it was reoccurring, and I knew that it was coming in every month, and that was always what I wanted. I didn’t want to just sell and ebook or an info product where it was like, “Oh, I hope I make sales this month.” I wanted something that was monthly recurring revenue.

Andrew: It’s a great idea. I can almost see people . . . We’ll talk later about Opesta. I could see people creating something similar that for real estate brokers that reaches their potential customers via Facebook Messenger on your platform and then charging a monthly fee to real estate brokers to maintain it. I could see that actually working lots of other spaces. How did you even get the real estate brokers to come listen to your pitch and learn from you?

Ethan: So, the funny thing is that the way that I did my pitch was through a webinar. And looking back at I don’t know how anybody even really bought anything, or how I figured out. I remember I had a list of . . . I found a website where I could buy a list of emails that you could email once to not violate any can spam access stuff, and you could buy real estate agents. And so what I did is I bought this big list of emails from real estate agents. I built a basic landing page from my webinar. On the webinar was basically how to use Facebook to generate buyer and seller leads for real estate, something along those lines.

And I wrote it up in email and I would just, once a week, I would send out about 2000 emails, and I would get about 200 people registered for this webinar, and then I would go through and sell it. And the first time I ran a webinar, I remember it was like two days before the webinar, something that you’ll learn about me is, I’m like a doer. My plans step out better now, but in the past it was just like, “Just test it. Let’s test it. If it works, awesome. If it doesn’t, scrap it. And so this whole thing, this whole process was, “I’m just testing it. And so, I thought, “webinar, awesome.”

I didn’t think through like, “Oh, I actually have to prepare a webinar” Or, “What do I talk about on the webinar?” I just knew webinar and then I’m selling this at the end. And this will be like how I’ll teach them so it leads into it. And so two days before the webinar I thought, “Man, I’ve never actually even attended a webinar myself besides like for training for work, which they’re not selling anything. How do I run a webinar? Like what do I do? And so, I literally just went to YouTube and I typed in like, “How to run a webinar.” And I found like the video with the most views, I don’t even know who was by, not by anybody that we would recognize the name of. I watched that and I literally followed and just did everything that he said, and it ended up working out. I’m sure if I did it now, it would work way better, because I have a lot more knowledge and experience now.

But I remember the first webinar I sold to like five people, and I was like, I called up my girlfriend and I was like, “You know the craziest thing just happened. You’ll never believe it.” And I was just ecstatic.

Andrew: And you were teaching them how to create landing pages, but saying, “If you don’t want to do it yourself, I’ll create it for you.”

Ethan: Yeah, exactly. I showed them the exact process. And that’s what I always tell people. People say like, “Well, what do I teach?” And it’s like, “Show people what you’re doing, and there’ll be a percentage of people that are do it yourselfers, and they’ll do it themselves. There’ll be a percentage of people that just don’t do anything, and then there’ll be a percentage of people that just want it done for them because they’re too busy. They’re doing other stuff. And so, those are the people that’ll buy from you.

So yeah, I showed them everything that the whole process from how you set up the ad in Facebook exactly, here’s what you’re pushing to a landing page, here’s how you build it, dah, dah, dah. If you don’t want to do this yourself, we have templates, we’ll do it for you, it’s X amount per month.” And that was it.

Andrew: And frankly, $29 a month is cheaper than a Leadpages account, which was $79 at the time for the cheapest. All right. So you’re doing well there, but it’s not the huge break out that would get you on Mixergy.

Ethan: Yeah.

Andrew: You then say, I’m going to get into SaaS. Why don’t we take a moment and talk about one of my sponsors and get into how you figured out SaaS software as a service. The sponsor is a company that you don’t know. And for once, I’m going to get introduce you to software. Every time you have a problem trying to figure something out, you always have software for me, you always have a solution. So let me introduce you to MelShake. Here’s the idea behind MelShake . . . here it is. You sent me an email back in 2016. Do you remember this one?

Ethan: Yeah, I do.

Andrew: It was, “Andrew, I have this idea for how you can use Mixergy on Instagram, I run the software. I can do it for you using my software. You’re basically looking for some influencers to help promote the software and give use cases, right?

Ethan: Yeah, Mm-hmm.

Andrew: So you sent that email manually.

Ethan: Yeah, I did. What MelShake lets you do is collect a bunch of people like that, like maybe decide, “You know what? Podcasters are really good audience for me, and so they let you find a bunch of podcasters’ email addresses and names, and take this email that you sent me, this has Mixergy in Instagram, and turn it into a template. So for someone else, it might be Noah Kagan show, and Instagram is a subject line for . . . You get it, right? It’s always the name of the show and Instagram. And you send out this message, and it looks like it’s coming from you, because it is coming from you, but it’s going to multiple people. And then if they don’t respond, you could set up an automation that says, “Hey, just bubbling this to the top of your inbox.” Or, I noticed you didn’t respond, but it really is free. I’ll do it for you. All you have to do is hit reply.”

And so, you can set up one follow-up, two follow-ups, three follow-ups, and then if they do respond, the software just says, “Okay, I’m not touching it.” Now, Ethan is going to take over from here. And Ethan can handle it in a more personalized way. So it allows you to do things like what you did, which is influencer marketing. It also allows you to do what you did a long time before which is, reach out to real estate brokers, if you have their contact information, but instead of sending one message, if they don’t follow up, you could send another message, and maybe even a third. And so, the idea is they automate it, they keep track of analytics, and they follow through on your behalf so that you can get results and only talk to the people who are truly interested.

Ethan: That’s huge.

Andrew: Noah Kagan on his podcast said that he gets, I think it’s half of his responses from a follow-up message. So the first message people ignore, the second one, they’re more likely to respond to. That’s the idea behind MelShake. It’s created by a Mixergy fan. I just love the way this guy thinks. I thought he bought it, but I guess he built it himself. He’s making this available to anyone who’s listening to the sound of my voice so many different ways to use this. Use it to sell, use it to do customer development, schedule customer development calls, do this to do SEOs, so many different reasons to do it. But before you can sign up you should go check out their web page, because they’re going to show you how this works. This is going to give you an understanding of a better way to market one on one in an automated smart way. Go to melshake.com/mixergy. Melshake.com/mixergy and you can get started right away. It’s a pretty good name. Don’t you think?

Ethan: Yeah, I think so. And even to add on to that, I think a lot of people underestimate the power of just sending out cold emails like that. I sent you one in 2016, early 2016 and then I think we connected in 2017 early. And when we connected you said, “Hey, wait. Did you email me a year ago?” And I said, “Yeah.” So it stuck. You remembered at that far along. And to be honest, you also replied to that first one. You know, we didn’t end up doing anything together, but you did open it, you read it, you applied. And so I think having a tool that helps you kind of automate that follow-up and stuff is huge. And you can move the needle a lot in your business just off those kind of personal styled emails.

Andrew: Yeah, that’s a really good point, that even if people don’t respond to the first message ever, it’s in their inbox. When they look for you later on to see if they should follow-up, they get a sense of everything that they’ve done and the idea that this is someone who stuck with it for a couple of years, is very powerful. I’ve had the same thing happen with interviews. I’ve asked people to do interviews on Mixergy for a couple of years, and then when they finally say yes, I ask them, “What made you say yes?” Say, well, you’ve been asking for a while and I don’t think that they knew that I was asking because they ignored the messages. But they know even if they don’t respond.

All right. So then, SaaS. You wanted to create SaaS, why?

Ethan: Yes. So like I said even with the first thing that I . . . the first kind of business that I had success with that landing page, it was all focused around monthly recurring revenue. So even when I was thinking of like, “What do I want to offer to these real estate agents? I could have just sold those pages there like a flat price, and I would have probably made more cash. I could have probably sold one for $99 or something like that. But like I said, I always wanted that recurring revenue. And so, SaaS, in my mind was like, it’s the holy grail of what you could do online today. It was recurring revenue, it was predictable. They’re easier to sell if you ever decide that you want to get rid of the business, because it’s close to almost like online real estate, you know. It’s close to . . . There’s a lot of venture funds, people like that will buy SaaS companies just because it’s pretty predictable.

And so my goal going into the kind of trying to make money online was, I was if you would have talked to me in 2015 or something like that, I would have told you, “Hey, if I can make $3,000 a month online, I’ll be the happiest person in the world. You know what I mean? That was basically almost about the same as what I was making as an insurance agent in training obviously when they offered to bump me up, and I turned that down, there was a big pay increase with that, but I didn’t need a lot. I wasn’t married, I just wanted to make $3,000 a month online, and I thought SaaS was the way to do that.

Andrew: And you got into Instagram because you’re an Instagram user like so many people. Facebook feels like the place you have to be to be more like a . . . it feels like the Rotary Club to me. Instagram feels like a more fun social network. And so, you’re on there more often. And you said, “Maybe there’s something to do here.” Why there? Why Instagram?

Ethan: Yeah. I saw this trend happening. And it was that I realized that hey, at the time I was, I don’t know, 24, 25. And I spent 90% of my time on social media on Instagram. And then I would still get on Facebook and things like that. But the majority of the things that I would join was on Instagram. And all my friends in that same kind of millennial age group, were doing the same thing. And so, I realized, and it clicked in my mind, hey, this same thing was happening on Facebook in 2009 through 2011, and the businesses that got on Facebook in 2009 and really kind of trying to make a push and make a presence known there, it paid off huge for them, and they saw amazing returns, and still are to this day.

And it’s because they were able to kind of capture that millennia demographic and then kind of get your [job 00:26:32] wider and wider, and grew up, and I saw that the same thing was going to happen with Instagram. And I thought it was the perfect place to kind of get in early with some software for businesses, and try and help get them onto that Instagram platform to be able to see the same results and kind of leverage the fact that Facebook going down, this is the same thing. The same thing that happened with Facebook is going to happen [within strand 00:26:55]. Don’t miss out type deal.

Andrew: And you’re thinking ads, help them manage their ads when they came out. Is that right? Or there’s just something else?

Ethan: I wasn’t sure. When I first started SocialInsight and we were building it, Instagram ads weren’t even a thing yet. They weren’t even announced yet, and I knew that I would probably head in that direction, but until Instagram opens up an API, or Facebook, I guess, opens up an API for it, it’s not there. And so I thought what can we provide? And the first thing I thought was, “Hey, let’s just provide some analytics. So we’ll get a business account on Instagram. These very companies want to see how many people are reaching, what the demographic of the people they are reaching looks like, what their kind of social media efforts on Instagram are actually kind of doing for them . . .

Andrew: Is that true? Or did you imagine it?

Ethan: It was true to a degree, but it’s primarily, I guess, a big focus for enterprises over like SMB per se. And I found out when we first created that I didn’t really know how to sell the enterprise yet, wasn’t a strength the mine, and so, I struggled in the beginning, because I was trying to sell the SMB, and that wasn’t necessarily what . . . SMBs are a little more ROI-focused. They don’t have the kind of extra cash like an enterprise does just for data type deals.

Andrew: Yeah, I’m looking at an early version of your site and it says, “Know Your Audience” and then here’s the subheading, “The Instagram Tools You Didn’t Know You Were Missing.” And if somebody doesn’t know they’re missing it, doesn’t know they need it. It’s really hard to get them to sign up.

Ethan: Exactly.

Andrew: Okay, that’s one of the first things you did. You also had a co-founder at the time, which we’ll get into some of the challenges of the co-founder. Who was the co-founder?

Ethan: He was a guy named Justice, and . . .

Andrew: Justice?

Ethan: Yeah. He lives in Germany, and I actually met him in Noah Kagan’s kind of paid course group. You know, Kagan had a . . . he may still have it. I’m not sure.

Andrew: Earn 1k.

Ethan: Yeah, Earn 1k. And so to this day, that’s the only course I’ve ever paid for online. And that was the first one I ever took. And part of that was a Facebook group and I connected with Justice there, and kind of had pitched him this idea that I had, and he was a developer, and we thought we could maybe try and go ahead and put it together, together.

Andrew: Okay. He was going to be the co-founder you said. One of the first mistakes that you made was the . . . what happened there? What’s the issue?

Ethan: Yeah, the issue that I had there was we jumped into it right away. And I kind of, I set myself up to have some time to be able to really figure this out. I had bought my first house very young, I had a lot of equity in it, so I left American Family, quit my job, sold my house, and took out almost six figures worth of equity that I could just kind of live on and invest in this. If things didn’t go right, I could always get a job as an insurance agent somewhere else. And so I was kind of set up for a longer term thing, and I think he was maybe in a position where he needed to make money quicker. And I didn’t really discuss that with them. And so when things didn’t take off as fast as we thought when you have bills that you have to pay and things like that, the pressure starts to weigh on you, and that can cause a rift.

Andrew: The first marketing that you did to try . . . Actually, before you even had the full product, did he at that point start to leave? No, he was building it, right?

Ethan: Yeah. He was helping to . . .

Andrew: He was building it, you launched the first version, the one that I just described, the subject line, of the headline on your site, then it was on you to start to market it. You said you had trouble marketing to bigger companies. You were trying to figure out what worked. What’s one thing that didn’t work before we get into the thing that did work?

Ethan: You know, one thing that didn’t work was, I had never really marketed a full SaaS play before. And so, to be honest, when I first launched this, I was still very new to online marketing. I had the one thing that made money, but it was just, I had kind of a warm list of emails that I sent to get into a webinar, and then I was able to sell them this. I didn’t have any kind of thing, list that I could buy, or anything like that. So I thought, “Well, I’ll just run some Facebook ads, they’ll see the tool, they’ll see our landing page and all the things that it can do. We’re priced way cheaper than any of the other analytic tools out there. So it’ll be a no-brainer. We’ll just capture people based off of price.” And that didn’t happen at all.

So then I had to start getting a little bit more creative, and I started to kind of do like some tripwire things, and then try and do like $1 30-day trials, and a walk through that process.

Andrew: Why don’t we start with, before you did that, when ads weren’t working, did you start doing the tripwire and all these different sales techniques? Or at that point . . . or did you first go to this blog post, they spent a lot of time researching?

Ethan: I first did the tripwire stuff.

Andrew: Okay, so then we should start with that. What is a tripwire? And what’s the first one look like?

Ethan: Yeah, so a tripwire is basically anybody that runs an offer. So whether that’s a free eBook, or opt in to my mail list, or whatever it might be. You get somebody to opt in to an offer, and then on the thank you page, you deliver what they opted in for, so the ebook or whatnot. But then, you can also offer what’s called the tripwire offer.

So it’s basically, a low-priced offer that is in the same vein as the thing that you just delivered. And its whole entire goal is to just get somebody to become a customer as quickly as possible. So usually they run between $5 and $20. The cheaper they are almost the better, and it just you sell it just on that thank you page. So somebody else in, they see the thank you page you have some long form copy or video, whatever, however you want to sell it, and then they can say, “Yeah, I want this tripwire offer, and then $7, they put in their card information, and then you have somebody that’s actually a customer, not somebody . . .

Andrew: And then do you also have their credit card on file for future sales? Does that matter?

Ethan: Yeah, exactly. So that was really important for us. So what we did is we offered it . . . I kind of modeled this off of DigitalMarketer at the time, and they still kind of do this, but at the time they had a big offer called DM Labs. And it was like 39 bucks a month or something like that. And inside of it it had like 40 action plans for all kinds of digital marketing things. How to set up a Google ad, how to do this . . . in a way that they got a lot of customers in, as they would say “Here’s your free Facebook . . . our blog post checklist. You opt in for it, and then on the next page, “For $7 dollars get the entire blog post action plan, it has seven different lessons in it, dah, dah dah.” As soon as you checked out and said, “Yeah, I want that.” They would say, “Oh, wait. You know, for one more dollar get access to all of our 40 action plans for 30 days, and then it’s $39 a month after that. And since they have your credit card information you just say, “Yeah, I want access.” And they charge you one more dollar then you had access to everything.

So we did you know the same thing essentially. We offered an ebook on how to help get your first Instagram subscribers, and then we kind of upsold an action-list course that had 10 modules in it or something like that. And then, after that, if they purchased it for $7, we said, “Hey, for one dollar you get 30-day access to our Instagram analytics software.”

Andrew: So, you first sell an ebook, then sell in training, and then the software?

Ethan: Yes, so the ebook was free. Ebook’s free, and then we sold the training for $7 dollars, action training. And then for one more dollar, you get our software for 30 days, and then it’s $29 per month after that. And that actually worked well at the time, and though I didn’t have a lot of experience to running paid traffic, I didn’t know what the lifetime value of our customers would be on SocialInsight, because it was so new, so I didn’t know if somebody would stick around for one month, or 12 months. So I didn’t really know how much I could have spent to acquire a customer.

And I just wasn’t very savvy in that sense. Actually getting customers for a good price, but I never scaled the ad, spend just because I didn’t know. I always thought that I was running the risk of, “Hey these people . . . Let’s say we get 10 people that would take the one dollar upsell. How many of those are going to cancel? I don’t know yet, and then how do those ones that continue on, how long are they going to stay on?

And so, you have to kind of know how much you can afford to spend on a customer before you can really scale or have a lot of cash. And I didn’t have either. So I never really scaled that as much as I could. Looking back, if I was in that same position, I would have claimed as much money as I possibly could.

Andrew: But how would you know? How would you know when it’s profitable or when it will make sense or not?

Ethan: You just have to have the data and be a little bit smarter on your numbers. If I knew kind of what I know about SaaS now, after about a month or two I would have been able to have a general idea of the lifetime value of a customer. Because what I would be able to see is I would say, “Okay, last month we sold a hundred $1 30-day trials, out of that hundred, 20 of them converted into an actual paying customer of $29 a month.” And then the next month I can see, “Okay, out of those 20, how many are still subscribed? How many of them paid for a second month? And we’ll say, 18 of them did. Okay, so that means 10% of people churned off. So I have a 10% insurance, so that means somebody will sit around on somebody’s worth about $290 for us over the lifetime of their customer.” And so then I can go back and say, “Okay, I’m able to spend X amount per $1 trial, and then I can just work backwards into it. But I just didn’t know that then. I didn’t understand those things.

Andrew: Okay, I’m with you on that. The thing was starting to work out. What I’m curious is, how did you know the content was the way to go? Today, with Opesta you’re kind of banking on that, on selling education not just software. How did you figure that model out? Most people will just say, “I’m a software person. I’ll sell a $1 trial, but not a course first.”

Ethan: Yeah. The reason I went that way is because of the way that I came into online marketing. That’s all I knew, because that was the way that I came into online marketing. That’s basically how Noah Kagan got me in. I started reading his blog. And then once I kind of read his blog, I saw that he had these lead magnet upgrades. And then I’m on his email list, and he’ll send me an email after I’ve consumed a bunch of content, and now and I know these things, so I’ll buy whatever he offers in the email. And so that was kind of what I saw worked for me. And so I was just saying, “Hey, if I bought that way, then hopefully these other people are going to buy this way.” And I just didn’t know any other any other way, really. So I just kind of went with what I had experienced, and luckily it worked out.

Andrew: At what point did you know this was a model worth spending ad money on?

Ethan: Once I got a sales funnel dialed in for a little higher entry point, and I knew the numbers on the lifetime value, that’s when I felt a lot more comfortable spending ad spend on it. In the first month that I actually figured out and dialed in our sales funnels and spent ad spend, I remember we added $8,000 in MRR. So that’s Monthly Recurring Revenue. And it was like the first month. And that’s when I was like, “Oh, my gosh.” All these numbers start running through my head. Okay, we added 8,000, my churn’s this. Next month if I can add another 8,000, oh, my gosh in 10 months I’m going to be making $100,000 a month. All these things you hit this. And that’s when I kind of really got fired in, and it was like all in. You know, I was trying to figure out how I can get bigger credit lines on credit cards . . .

Andrew: So you can buy more ads . . .

Ethan: More ads, yeah.

Andrew: To feed the funnel, to sell more and make that money not immediately, but two months down the road, maybe three months.

Ethan: Exactly, yeah.

Andrew: That’s not exactly how it worked out. It didn’t become that kind of model. I want to understand why, I want to understand what happened with Justice, your co-founder. But first, let me talk about Needls. You know what? I told you before we started, I wasn’t sure how to talk about Needls considering that you are buying my ads. Right? So why am I telling people I’m working with Ethan, I’m paying Ethan, but you guys should go sign up for Needls and let Needls buy your Facebook ads. So what do you say to someone who thinks that way?

Ethan: Yes, so, I mean, for those that don’t know, I’m fairly familiar with Needls, because I know the guys that started it, and really enjoy the software. But for those that don’t know, Needls will run Facebook ads for you. It’s one of the first kind of robot agencies, I think is what they refer to it as. And so, I guess your question is, why would you hire Needls outside of just hiring ad agency? And I would say, for hiring an ad agency, it’s expensive, right?

Like you, I run your ads, but you also pay me a fee every month that’s a lot more expensive than what you would pay Needls to kind of run ads for you as a SaaS. And then on top of that, the funnel that you’re running is a little bit more complex than most people. So you’re mainly . . . right now we’re mainly buying ads for you to follow webinar for your Bot Academy business. And in that you’re having webinar start at different dates throughout the week. Once people opt in to a webinar, you want to target certain people at certain times, with a specific card open ads, all these things. There’s a lot of like moving parts.

Andrew: I’m also copying John Lee Dumas idea where anytime now someone partners up with me as an affiliate, I go buy ads on their behalf.

Ethan: Yeah, exactly.

Andrew: And so, you have to do that. And you’re saying Needls is not going to do all that.

Ethan: Yeah. It’s going to be really hard to do all of that through that software. But if you’re a business where you have one funnel that’s straightforward, or you’re brick and mortar, or your budget is smaller, or maybe you only have less than $5,000 a month or something like that, Needls is an awesome a platform for that. It’s super, super cheap. It does an amazing job optimizing and figure out targeting, and placements and things like that. I’ve used, and a lot of times, to be honest, before we take on a client, we do a consultation call, and if I think they’re just not where they need to be with us yet, I recommend that they use Needls first. And so, I refer a lot of a lot of people over there as well.

Andrew: And Needls will, first of all, their prices are really low, and what they do is, they will create the ads for the business, they will then watch what people are saying on social media, and use what they’re saying in addition to who they are and where they are in the world and so on, another targeting, to target them. So for example, if somebody in our audience were running a, let’s say, a chatbot agency. Needls would look to say, “Who’s saying, “I could use a chatbot?” Or, “What are these chatbots and is also a business owner in the right target.” And then they would show them the ads that Needls created. So they call themselves a robo agency, because all this is done using software, and as a result, because it’s software, it costs a lot less. I’m paying thousands of dollars a month in addition to the Facebook thousands of dollars that we pay. With Needls, it would be in the hundreds for that today.

Ethan: I think the last time I looked it was like $100 a month.

Andrew:And they’re offering a big discount for people who want to try it out through Mixergy. So if you’re interested, and frankly, if you’ve never bought Facebook ads before, this is a great way to get started without truly losing thousands of dollars as you’re figuring it out. It’s a great way to get started if you’re someone who’s tried it and it hasn’t worked out for you, this is a good way to get going with it.

If you’re someone who’s doing it on your own, it’s sucking up a lot of your time, this is a good way to do it. Needls is being used by so many businesses, you should give them a shot. And if you do, use this special URL where they’re going to give you a big discount, and where Justin the co-founder there, who’s a long time Mixergy fan and also an interviewee, he’s going to know you came from Mixergy. So he’ll know you’re part of our tribe, and part of his tribe.

Here’s a URL, and the tricky part is Needls has no e, like no third E. It’s N-E-E-D-L-S.com/Mixergy. So It’s N-E-E-D-L-S.com/Mixergy. Is that a mistake that he didn’t have Needls with that third E at the end?

Ethan: No. I think it’s cool. I think it’s unique. It kind of gives it a branding angle.

Andrew: Once you see it on the page, it’s very clear. I wonder how many people are going to mistype it. Let’s see what happens if I type Needles with extra e.

Ethan: Oh, yeah. I never even tried that.

Andrew: Let’s see who has that. “Legal case management software” He’s got nothing to worry about there. Justin’s like . . . He’s like an animal, is like a beast. I can’t believe that he didn’t find a way to get that domain. He must not think that it matters that much huh?

Ethan: I’m sure it’s expensive, I’m sure.

Andrew: The story that I tell about him is, he was driving me back from Fireside Conference in Canada back to his place in Toronto, he, I guess he doesn’t want to use a headset, or maybe it was weird to talk to his wife on headsets, so he put her on speaker, and they were talking, and he said something about, like how something frustrated him, and his wife goes, “Then work harder so that you can afford a better solution.” And I thought, “Wow! I love this woman. I love their relationship. So many other people would say either, “Don’t complain.” Or, “Work a little bit less. You’re under too much stress.” She was like, “No, work harder you son of a bitch.”

Ethan: There you go. Put the fire on him. She’s been reading a lot of that “Rich Dad, Poor Dad.”

Andrew: I feel like he grew up in that rich dad family. I feel he grew up in this community of people who are all hungry, go-getter entrepreneurs. Every time I talk to him about a business he knows the founder, he’s like a friend with the guy who started Sweet Green, he’s buying a business over here, he’s helping this guy over there. I say, “Hey, you and I are going to get together in San Diego.” “He’s going to be in San Diego too. So I invited Joe Com [SP].” I say, “How do you know Joe Com?” “We helped him when he was buying and selling businesses.” Smart guy.

Let me get back to you. Anyway, the site is needls.com/mixergy. I’m kind of saying it too many times because I’m a little afraid if it doesn’t work for him, it’s not like he’s going to ask for his money back, but I know that he’s not going to be, “Ah, just money.”

Ethan: Yeah. He wanted, I mean, regardless of whether you know who’s buying the ad or not you want it to perform well for him.

Andrew: Yeah, I know it. And I know that also if it doesn’t work well, that people are going to go and contact Justin and say, “Hey, Justin, dude, I signed up for Needls through Mixergy, why isn’t this doing well? Why isn’t it killing it?

All right. So, you’re doing all this stuff, and it’s starting to work. Let’s talk a little bit about the co-founder. The co-founder was getting a little bit anxious when things were taking some time. What happened with Justice?

Ethan: Yes. So, things weren’t growing as fast as we had hoped. At first, we weren’t really getting any customers like I said, then we kind of figured out that tripwire style funnel and we started to get some, but like I said, I didn’t dump kind of ad spend in it, because I just had no idea. And then he’s getting anxious,” Hey, we’ve got, this thing is, we’ve got to validate this. We’re going to makes more money from this to make it worthwhile. And if not we should just kill it.” And I come from, my father wasn’t very entrepreneurial, but my father is, he’s the hardest worker that I know. He’s honestly, I used to call him a workaholic, because he worked for Intel, he works 12-hour shifts, he worked nights my whole life, and any time that he had . . . any day that he had off, I just dreaded because I knew I’d come home from school and we’ve been working on something.

Andrew: You mean you and he working together?

Ethan: Yeah. I mean, he would be working all day without me, but then as soon as I’m home, he’s got another hand to do work, so you’re getting there.

Andrew: But what will he have you do? Go clean up the yard? That type of thing?

Ethan: Yeah. We lived on an acre, so we would go and pull all the weeds in the yard. He’s a mechanic, that’s what he kind of did for Intel. He maintained their machinery, he loved building cars, so somebody that a friend of the family, or at church, their car was broken down, we had a big six-car garage, he would always have him come over here, and we’d fix people’s cars for free. He never let anybody pay him, you know. The only thing that he accepted for payment was a 12 pack of Pepsi. He loved Pepsi. So there was just always something. And if there wasn’t something, he would find something because he’s workaholic.

So because of that, he always said our family motto is “Failure is not an Option” and that’s actually a NASA motto. He took it at NASA motto, he kind of took it from them. And so when I was there and he was saying, “Hey, we got to shut it down.” In my mind, “Hey, we’re making money. We have other competitors that are doing well. They’re big, so there’s obviously a market for it.” So in my mind, it’s validated. And the problem is me somewhere. I’m not marketing it right, whatever it might be. And so in my mind, “Failure is not an option. I am not shutting this down. I am figuring this out, and I’m going to push hard.”

But in his mind, “Hey, scrap it. I’m going to move on to something else. We can move on to something else.” And so, I said, “Hey, I have this idea.” Instagram ads just came out. We kind of, like you mentioned earlier, we had written a big blog post on it, but it brought in a ton of attention. I got really early access to Instagram ads by paying an agency basically let me use one of their ad accounts. And so . . .

Andrew: You basically said to them, “Look, you’re an agency that . . . I want to emphasize this. Once you tell the story, because it wasn’t like you just called up an agency and said, “Can I pay you to use your software?” I think this gives people a sense of what failure is not an option will lead somebody to do. When Facebook came out with their ads or when Instagram did, tell them, tell us.

Ethan: Yeah, Facebook announced they’re running Instagram ads, but you couldn’t figure out how to run them, or at least I couldn’t. And so, I did some digging, I found out, “Okay, they’re not actually released, they’re in a beta and only really big agencies that are basically approved by Facebook can actually use that tagging right now. And so what I decided to do, is I decided to go and apply to all these agencies to run ads for us, and when I got on the calls with them, I told them, “Hey, look, I’ll pay you whatever your fee is, whatever we determine, but I want to have the possibility . . . the only reason I’m doing this is I want to run Instagram ads myself, see what they’re like, I’m going to write some content around it, so I need to have access to the account. And if you’re cool with that, then I’m fine paying whatever your payment is, but I am also going to be in that ad account. And I honestly don’t care if you guys don’t do anything. I’ll pay your payment, I’ll run all of our ads. I just want to pay for this, this account.”

And we had a bunch of them tell me no, and then I finally found one that said, “Yeah, okay. Why not? Free money, right?” And so that’s how I got access, early access to Instagram ads. And so, I started then setting them up. I wrote a big kind of 30-day live case study about running Instagram ads, and so I realized at that point I knew more about Instagram ads than 99% of people, because 99% of people just didn’t have access to. And they were going to get rolled out of beta in like a month.

And so I made this whole course around Instagram ads, and got ready for when beta ended, and my big thing was, “Hey, we’re going to run a big webinar, we’ll run a ton of traffic to it. On this webinar we’ll teach you about Instagram, Instagram ads. I’ll sell this course for two $299 and it’ll include X amount of months of the software, and then after that they’ll be able to get billed into the monthly plan. And it’s going to crush it, because there’s nothing else out there.”

And so that’s what we did. We ran a ton of traffic. That was like the light at the end of the tunnel. Just stay with me until this happens. It’ll be all good until then. And we got a bunch of people on this webinar, I went through, I pitched it, and literally no one bought the course. I didn’t sell any.

Andrew: Wow. I’m looking at this post, by the way. It is, I have it in front of me. It is so detailed, it’s so consistent, too.

Ethan: Yeah, it was huge, and I thought that course was going to do really well because that post actually got a ton of attention, and that post did really, really well. And so I don’t know if I didn’t sell the course because I just did a bad webinar or what it was. But we definitely had people there, we definitely kind of had the course and I thought the timing was right. It might have been a little bit too early. In all honesty, it was right when beta ended, but who knows, the timing wasn’t right. We didn’t sell any. And at that point, it was really hard to keep him incentivized, because that’s just another nail on the coffin.

Andrew: Especially after the buildup, and after the work. If that doesn’t do it, then maybe nothing will. I get it. Did you buy him out?

Ethan: Yeah. So I ended up buying him out. We weren’t making a ton of money then, so it wasn’t huge. It was less than $10,000, but it was still hard to swallow, because like I said, I just spent a ton of money on ads to webinar. And beyond that I didn’t want SocialInsight to die, so I had to buy him out. I didn’t feel right . . .

Andrew: How did you get the $10,000?

Ethan: I actually called up a family friend of mine and I asked them to loan me the money. And I set up a [loan shark 00:53:19] deal with them essentially, where he said, “Yeah, I’ll loan you the money. It’s going to be a 12% interest and it needs to be paid back in I think we said like six months or something like that. And I rallied and made it happen, but that’s how I got the money.

Andrew: You know, so I knew you because you were buying ads for John Lee Dumas. At what point did you start doing this ad business where you were the same agency where you were buying ads for people?

Ethan: It was right around that time, because . . .

Andrew: As a way of making ends meet.

Ethan: Yeah. I had to figure out, “Okay, how am I going to make an extra almost $3,000 a month now to pay this loan back, that I just borrowed to buy out my co-founder. You know what I mean? And then beyond that, I wanted some extra money to then try and figure out what we could do to really get, you know MRR up with SocialInsight. And so that was right when I kind of started sending out emails to people like that to try and land them as ad clients.

Andrew: How did you get John Lee Dumas as a client?

Ethan: So what I initially did was, I had one client that we got and ran ads for and had really, really good results. And I got them because they read our blog post, they saw that what we’re doing with this Instagram ads. They said, “Hey, can you run some for us?” And so we did. And then I took those numbers and I just leverage them. And I sent, I made a list of 100 people that I would love to run Instagram ads for, and I kind of put together personal emails for each firm, but the general gist of it was, “Hey, I think Instagram ads could really help Entrepreneur on Fire. I see that you’re doing this.”

I would look at what their funnels were. So he runs PodcastersParadise, I went and understood their business and said, “Hey, I think we could run some ads to this offer. Here’s some results that we’ve gotten in the past for XYZ. I’ll do it for free for the first month, and if it works for you and you want to keep doing it, you’re more than happy to let you pay me to do it. But if not, then no sweat, and we can go our separate ways.”

And actually, the majority of those people replied. All the really big clients that we got, that I kind of run ads for now, I can say directly came from those first emails that I sent out, whether they were one of the first people I emailed, or like John referred you to me, that type of deal.

Andrew: Are you still taking on new clients?

Ethan: So what I’ve done now is I personally don’t have time personally to take on any new clients, but there is definitely still a space there. And so I’ve created our agency side, and it’s called Advengers, and I brought in an agency manager from one of the original founders of a company called Six Division. And so, he’s running that and managing that. So we do take on new clients, and he kind of takes that in, and I just kind of do some consulting. And we have some ad managers here in-house, and then all kind of consult on what to do . . .

Andrew: What’s your URL on that?

Ethan: It’s advengers.io

Andrew: Oh, Advengers, I got Advengers.

Ethan: Yeah.

Andrew: That’s tough domain. advengers.io, advengers. Is that an awful for me to say?

Ethan: No, no. It’s true. It’s hard to pronounce, and you get a really articulate it. But I thought it was cool because if we sponsor events or things, I think it leads a lot of opportunity to do fun things like dressing up as superheroes, or things like that, and so, it’s just the basic landing page right now. People can come in and book a consultation call for free, and we’re in the process of re-, kind of doing that whole websites that are probably done by the time I’m sure this airs.

Andrew: There, I got it. I like the design. So now you’ve got one new thing that you’re coming out with which is this messenger marketing business. Well, you kind of talked about it. You said, “Look, Instagram was something I was interested in, but not in the way that it turned out to be, right. Tell me a little bit about . . . What is it a about SocialInsights that doesn’t attract you anymore.

Ethan: Yes. So we ran into a lot of hiccups, and one of them is a personal thing for me, but then there was also business things. We started out when we first started SocialInsights, it was Instagram analytics. And then Instagram launched their own analytics. So then we had to build out like post schedulers, and different tools that differentiate us. And now I just saw that Instagram was probably moving towards building those tools themselves. And so from a business standpoint, it’s like, “Okay, what’s longevity of this business? And I need to diversify myself.”

And then from a personal standpoint, I started to realize like the majority of our customers that came in 75% of them were women between 20 and 35, and they weren’t really interested in the marketing side of Instagram like I was. I was really into like, “Hey, let’s take Instagram, let’s push. Let’s use it so you can build a tribe and just push a ton of traffic and sell things. They were more interested in like the management side of it, the aesthetic, the branding, creating kind of a personal, I guess, vibe for themselves. And it wasn’t what I had wanted. It was hard for me personally to get excited about it anymore when I kind of . . .

Andrew: Yeah, I feel like the tools that Instagram people are excited about are the ones that let them tile their photos in the right way, and do things that make their presentation look better. All right. So that’s why that is something that you’re looking to shift away from. It’s interesting that it just keeps running on its own like that.

Opesta, the more I was looking into SocialInsight.io, the more I saw a little references to Opesta, like your Leadpages account, was opesta.leadpages.net even back when you first started. So I know that you’ve had the domain for a long time . . . Oh, look at you, you’re fucking . . . I’m on Opesta, this is what I dig about you? Little fucking touches, like the way the get early access button moves a little bit. I barely even noticed that it was there. You’re so good. You’re so good at this stuff. I like your Facebook ad buys, but I love talking to you on our weekly calls, just to see what do you think I should be doing with this problem. How do you think we should be handling that?

All right. So Opesta, really nicely done. And you keep changing it up a lot. I know your video was on there for a while, wasn’t it?

Ethan: Yes. So we had . . .

Andrew: I’m sorry, I’m distracting from the main point. What’s the opportunity that led you to Opesta? Why are you doing this?

Ethan: Yes, so not to diss out SocialInsight. Even today, SocialInsight does over five figures a month. So it still makes good amount of money. But I saw it was declining. We started to run ads more personally, because that’s what I love. I love . . .

Andrew: It’s not doing over five figures a month, it’s doing over 10,000 a month, right? It’s doing five figures a month.

Ethan: Yeah, yeah. It’s doing five figures a month, so it’s doing over 10,000 a month. Okay. And so I personally kind of shifted towards doing ads more, whether that was for SocialInsight itself, or for John Lee Dumas or you, or other clients that we have, you know. And that’s what really kind of I love. I’m like a direct response marketer, and I get really fired up about that. I love taking somebody that you’ve never met before, or maybe had never met in person and leading them through this process where they get tons of value and just want to give you money like that. That makes me feel like a magician, you know.

And so, during that process messenger bots kind of got announced, and we started using them more in ads, and I started to get really frustrated with all the platforms that were out there that you could use to build them if you didn’t want to do custom-code yourself. And the reason I was getting frustrated is because I saw a future for messenger marketing in more of a direct response way. Not like the examples they gave when they first launched somewhere like the 1-800-Flowers where you go and you are a messenger, you pick your flowers, and you order a messenger. To me that’s cool, but at this point I think it’s a novelty. It’s cool to show what it can do, but I don’t think the user behavior has evolved to that point yet.

What I do think messenger is great for is it’s great channel to get somebody’s attention to deliver short messages, short of amounts of value, and then lead them into existing sales funnels that you have, or existing sales processes that you have that they like to go through, or to meet them in those sales processes already. And so, I get frustrated in the fact of, why can’t I opt somebody into my messenger and get their email on a pop up on my website at the same time? And then I can take that and deliver ads to them, or I can put them in a sequence like I run in Active Campaign, or Infusionsoft, or anything like that, where it’s segmented, it’s smart, it can see what they do on my site, see what products they purchase, and then deliver them specific messages based off of that. There is no possibility out there. And so we started custom-coding that ourselves for our own sales funnels. And when we did, we saw amazing results from it.

Ethan: You made this for your own sales funnel for your clients or for SocialInsight?

Andrew: For SocialInsight so that you could ping people not just by email, but also via Facebook Messenger?

Ethan: Yes. So the way that I really finally started getting SocialInsight dialed in on the marketing side, is we started running an evergreen webinar and we sold, you know our software with the training package for like $39 bucks a month. And so, a big part of that is when somebody registers, you send them an email, “Hey, you’re confirmed, you’re registered. Here’s when it starts.” And then you wait and you see. Okay, did somebody attend the webinar? If so, then you send them specific messages for somebody who’s attended, because they’ve attended, they’ve seen the training, they know that you’re pitching them something, and so you talk a little bit more about that, and give a little bit more about it. If somebody missed the webinar, I know that they’re way more likely to convert if they actually get on the webinar, so I want to send them emails to get them on a different webinar time that we maybe have.

And then if they don’t make it, I want to send them a training in 30 minutes videos, links to just 30- minute videos, and I’ll send it to them for three days or something like that. And then I’ll put them in the product follow-up sequence. All right. So I wanted to be able to do that same segmentation, but inside the messenger, and I wanted to be able to . . . when somebody registers, send them a messenger message that says, “All right. You’re confirmed, you’re registered for the webinar.” And then I wanted to be able to say, “Okay, tell my messenger software this person attended the webinar.” So if they attended the webinar, put them in this follow-up sequence. If they didn’t attend the webinar, put them in this follow-up sequence, because we want to talk to everybody individually, uniquely. That’s how marketing really works well if you want to do some automation.

And it just wasn’t . . . it wasn’t possible doing any of the builders out there, so we had a custom kind of coded. And to be honest, when I hired . . . what I did is I actually took my programmers that were on SocialInsight and I said, “Hey, this is what I want to do. Let’s do it.” And they said, “Yeah, we don’t actually think that’s possible.” And I said, “I know it’s possible, because all you’re doing is pixeling people. And that’s not controlled, like, we can pixel people on, we can create our own pics on pixel people, and then we can just push this information on messenger, and so work harder on it.”

Andrew: I didn’t think that was possible either, because I talked to some of your competitors who were trying it, who are trying other ways of doing it, and even though I had relationships with some of your competitors, when you told me your vision for it, I just wanted to be, I want to do the right thing, and so I didn’t tell them this, but you’ve figured this out, and it blew my mind that it’s possible. Because I had ideas for how to do it too. It wasn’t working.

Ethan: Yeah, and that was also an issue that I ran into with my first co-founder. I can’t code, I mean, I know basic code, I know it’s HTML, PHP, things like that, and I know enough code to look at something kind of understand it, but I’m like 99% left brained. So conceptionally wise, and technology wise, I can understand stuff very logically, and I can outline, “Hey, this is what we need to happen in the program.” And then if I have a set of programmers that can also understand that and do it, we can implement. And so some of the first things that I want to do at SocialInsight is, I want to give people we’re doing analytics, let’s say you had X amount of engagement on this day, maybe you should post at these times and send people emails and things like that. But he was a mathematician, and so he would always say, “Well, that’s not possible, because it wasn’t 100%. Nothing is going to be ever 100% right in algorithms. You have a variable probability,

And so, he’s not wrong. It wasn’t possible. It was impossible to get to 100%. But it is possible to get to 98% which is good enough, you know what I mean. And so that’s where we were getting trouble. And so with this, a lot of people some or our programmers are saying, it’s not possible. I would say, no it is possible. Let’s sit on this call for two hours and I’ll explain to you. I’ll break it down on how I know we can do it. I don’t know the code that we can write, but I know conceptionally, through the technology that’s out there, I understand enough that this is possible if we do it . . .

Andrew: And just to be clear for people who maybe weren’t following to this point, what we were all trying to do was say, if somebody was already subscribed to our messages in Facebook Messenger, so they were getting our messages, and happened to come to a page on our site for the webinar, we should send them follow-up messages that understand that they were at the webinar and say things like, “you are at the webinar yesterday, so you know this is possible. Here’s how our software does it.” And then the next day, you’re at our webinar the other day, you know this is possible. Here’s a case study of someone who’s doing it. And so talk to them with an awareness of what they did on your site, and Facebook does not enable that. Facebook’s pixel will not do that. You can use Facebook’s pixel to target people on Facebook itself with ads, and we do that thanks to you. If somebody comes to my webinar, your ads to them will reflect the fact that they were at the webinar and you say, “You came to Andrew’s webinar. You should go and check this.”

But for chat, for messenger that wasn’t possible. I had a couple of ideas for how to do that, and I ran them by people. We tried them. It didn’t work. And I’m impressed that your pixel solution works so fast. All right, so that was your vision, it’s up and running right now. I’ve been on like a free version of it because I was one of the first users of it. Is it paid? What’s the model there?

Ethan: Yes. So right now everything is free.

Andrew: It really is huh? Okay.

Ethan: Yeah, yeah. So we’re technically in beta right now. Because the pixel works, but there’s still some things that it doesn’t necessarily work for. There’s always caveats, right? And so, we want it working completely when it rolls out. So, it’s still in beta, and there’s still a lot of features that we want to add before we kind of make it paid to want . . .

Andrew: Why don’t you do branding? Your competitors do that. Free but you have to accept some of our branding.

Ethan: Yeah. That’s going to be part of our paid model. Right now, it’s just . . . I want to, the thing is we’re coming into the game a little late behind some other chatbot software, and so to try and get market share we’re just going completely free while we’re in beta, and then when we launch our paid plans, there’ll be a free plan with some branding and different small caveats like that, and then we’ll have some different tiers there. So we’re doing the launch of our paid plans on March 12th, actually. So from March 12th to March 18th there’s going to be 40% discounts on all of our paid plans for life if you lock in during those times, and some different things like that. That’s when paid plans are kind of going live.

Andrew: All right. And if anyone wants to try that, it’s at opesta.com. All right. Congratulations on the success of getting out of insurance and into SaaS. A lot of people who tried, they’re not there, and you made it work. Anyone who want to go check out your two sites. I like how you told our producer, call it SocialInsight.io not Social Insight. There’s so many people have these .io, or dot this or dot that. Before I start, I say should I mention the full domain? And they say, “No, just mention the name. People will find it.” I think they’re over estimating what we can do. I think that it’s better to just give the full freaking domain, unless it’s a unique name like Mixergy or Opesta. Afraid that Mixergy has an issue too. I don’t mean to put down your name. I forget which one I was a little insulting of. But I got to speak my mind, so I don’t regret it.

But Mixergy, everyone keeps saying mix energy, mix energy, mix energy or mixology.

Ethan: Mixing it up. That’s funny. I don’t want you know ever worry that you’re going to offend me. I have some of the thickest skin out of everybody that.

Andrew: It’s because you’re so quiet. I feel like quiet people I can potentially offend very fast, versus loud people. I don’t know if [crosstalk 01:10:38] what I can say. All right. So it’s SocialInsight.io. It’s opesta.com, if you want to check that out. The two sponsors that I mention, really, if you’re not on Facebook ads, if you don’t want to spend a ton of money, but you just want to get started Needls, Needls, Needls. Oh, I think he’s going to be pissed that I said something about the spelling of his name. So let me say it’s N-E-E-D-L-S.com/mixergy.

And if you want to take a page out of Ethan’s playbook and start contacting influencers, or contacting people that you can do, ask for links or contact people you want to sell to, and you want an automated smart way that doesn’t make you look like a knucklehead, use MelShake, it’ll look really nice and represent you well and do follow-ups for you. It’s melshake.com/mixergy.

And finally, if you’re done with this interview and want to hear another interview by a friend of mine, go check out Jordan Harbinger’s podcast. You know what? I asked him, what do I say? So he gave me a list of things to say, do you know Jordan?

Ethan: Uh-uh.

Andrew: And then on the bottom, he sent me what, I guess podcast one created an ad for him that they’re going to run to support his new podcast. Here’s what it says, I’m just so fascinated by this. They told him to say, “Hey, this is Jordan Harbinger. I used to host the Art of Charm podcast, smile, but now it’s time for something new. The Jordan Harbinger Show. Did you know you could be entertained and actually get a boost in your life at the same time? On this show, we dig into the superpowers of the world’s most interesting thinkers and top talents, then we deliver them to you right in your ears. But I get it, we’re not all super heroes that’s why we give you their blueprint so you can live what you listen.” I don’t love that ad. Do you love it?

Ethan: No, no I don’t. It sounds just generic to me.

Andrew: It does. I wonder if he dressed this up. I wonder if he took their feedback and then said, “Screw that.” I’m going to do it my way. But they’re supporting him because he’s a damn good podcaster and he started a new one and everyone wants to get on-board, so I will too. Jordan Harbinger Show. Check him out on whatever podcast app you like. All right, Ethan, thanks so much for being on here.

Ethan: Thanks for having me, Andrew. I really enjoyed it.

Andrew: Yeah. Let’s not make this the last time. Bye.

Ethan: Bye.

Andrew: Bye, everyone.


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