Before we get started, tell me if you’ve got this problem. You’ve got a great product, but you’re not getting people to even try it, let alone buy it. Well, the problem is probably that you’ve got too much text on your site but check out what these startups have done. Here’s SnapEngage. They’ve got a video explaining their product right underneath the free trial button. Here is Send Grid. Right next to the get started button is a video explaining the product. Video, much more than text helps people understand what you’ve created and convinces them to try it and buy it.
The company that I recommend you turn to for this is Revolution Productions, same company that did both those startups and many others videos, Revolution-Productions. And when you go to their site, Revolution-Productions.com and contact them, I want you to talk directly to the founder, Anish Patel. Tell him I sent you; he’ll take great care of you and make sure you have a good video that convinces people to try your product.
Next sponsor is Grasshopper.com, and I want you to think of them as adding super powers to your phone. Want extensions? You can add it. Want a phone number that catches you anywhere you are, you’ve got it. Want to take your voice mail messages, maybe, and convert them into text? You’ve got it. Anything that can be done with a phone, pretty much anything, I can’t imagine what you can’t do, Grasshopper.com will do it in a very user friendly environment. So, you can keep adding features and adjusting them yourself, Grasshopper.com.
Finally, Scott Edward Walker is the lawyer that I’ve been recommending long before he even paid me for sponsorship. I don’t even know why, Scott, you even bother paying me. I’ve been telling people for years to try you but you do. So, I’ll tell my audience right now. If you need a lawyer, if you’re an entrepreneur, especially if you’re a tech startup entrepreneur, go to the lawyer that I recommend. And as you can see on this website, Jason Calacanis, Neil Patel and many other entrepreneurs recommend Scott Edward Walker of Walker Corporate Law.
All right. I’ve talked too fast and for too long. Let’s get right into the program.
Andrew: Hi, everyone. My name is Andrew Warner. I’m the founder of Mixergy.com, home of the ambitious upstart. The website where you come to hear successful entrepreneurs tell you the stories behind their businesses so you can learn how they did it, go out there, build your own company and, hopefully, do what today’s guest is doing, which is come back and teach others what you learned along the way.
How does a theme maker bootstrap over a million dollars in sales? Well, joining me today is Thad Allender. He’s the founder of Graph Paper Press, which develops website designs for creatives using WordPress, and we’ll find out what that means in a moment. I invited him here to tell the story of how he built this company. Thad, welcome to Mixergy.
Thad: Thanks for having me.
Andrew: I want to be clear since you don’t often talk about numbers. I want to give you room to just explain what that big revenue number is, and then we’ll go into the story. We won’t obsess on numbers, as I told you in the pre-interview. Over a million dollars in sales, over how long?
Thad: Since 2007. I started in 2007 on my own, and it’s been since then.
Andrew: OK. When I said, in the beginning, that you develop website designs for creatives using WordPress, I think we got that directly from your language. What does that mean that you develop website designs, and then what do you mean by for creatives?
Thad: Creatives has a broad meaning to me. I try not to pigeonhole folks, but we deal largely with photographers, designers, and some small businesses, even videographers. But we’ve tried to remain focused on a niche, and that’s really about where our focus has stayed over the last three years.
Andrew: OK. Tell me if I’m wrong. They install WordPress. They need a nice design to showcase their photographs and their other art work. They come to you. They buy a theme from you. They actually buy a membership, which enables them to download the theme and we’ll find out what else. They install it on their website. They tweak it a little bit, but it’s basically your theme, your design that’s helping them showcase their work, right?
Thad: That’s right.
Andrew: OK. It’s sold on a membership basis, as I said. How many memberships have you sold over the years?
Thad: That’s a good question. It’s somewhere around 15,000. It’s growing exponentially throughout the years, but it’s around 15,000. We have about 130,000 registered subscribers. We have a freemium model, and so users can sign up for free and get 20 of our themes on for free. The other five are behind a pay wall, and with the paid access you also receive support. If a user just wants to come to us and download one of our 20 free themes, they’re free to do so. If they need support and if they want the additional features of the paid themes, then they sign up for a membership.
Andrew: OK. The business is profitable?
Thad: Yep, business is profitable.
Andrew: Fully bootstrapped?
Thad: Fully bootstrapped.
Andrew: Run out of where I’m talking to you right now?
Thad: Yeah, run out of here. I’ve got a small office in D.C., and I have contractors who are awesome, who I’ve been working with, some of which I’ve been working with for three years, a couple for two years, and they’re located all over the world. I have one local employee, and that’s about it.
Andrew: OK. All right. Let’s go back and find out how you built up this business. Where did the idea originally come from?
Thad: The idea came from‚Ä¶really I had a need for a website. I was Director of Photography at a local publication around Kansas City. In 2007 I actually moved to D.C. to take a new job with a major media company, and I had a really difficult time finding website templates or even a constant management system that catered to all of the different needs that my website had. And that was to display photographs, to display video, to display audio, to even display panoramic images all in one place.
And so, it was really, really challenging for folks who published visual media to display their works online. And so, that was what led me to WordPress. I found it in 2007. Excuse me, I came to WordPress in 2005. I was part of the mass migration from Media Temple, excuse me, from Movable Type.
Andrew: Right, right.
Thad: And just really tinkered for about three years with WordPress. I started building sites for friends and colleagues and some organizations, and enough people became interested. I got tired of responding to e-mails: how did you build your website? So, I just decided to launch, develop a theme and make it available on my own site.
Just literally within the first day, I was pretty shocked at the amount of traffic that I received. This was kind of before premium themes became a term, and I decided to make the next one a paid theme to see what it would do.
Andrew: Let’s pause for a second here.
Andrew: When you were doing websites for your friends, were you charging people?
Thad: Not my friends.
Andrew: Sorry. I shouldn’t have said when you were doing websites for your friends. When you were doing websites for others, were you charging them for the consulting work?
Andrew: You were.
Thad: Organizations, yes; for friends, no.
Andrew: OK. So, the idea was, hey, why am I constantly doing this work one off and charging individuals and answering all these e-mails and repeating it for each person with a slight variation? Why don’t I just create a theme and offer it to them?
Andrew: But the first theme that you came up with, that’s what I understood. But the first theme that you launched was free.
Andrew: How does that solve the revenue part of the issue of the business?
Thad: Well, it didn’t solve the revenue. It wasn’t a business at the time.
Andrew: So, you were just going to put this free theme out there for the world.
Andrew: Why? I’m not saying you’re doing anything wrong. You’re here. I know how well you’re doing. I know that we’re not talking publicly about it, but I know how well you’re doing. You’re a smart guy. Why did you start off by offering something for free?
Thad: I think that when you launch something for free, you’re able to gauge public interest. If there’s public interest, you’re able to get feedback, and I got enough feedback and there was enough interest that I thought there was a pretty substantial market here. This kind of came at the same time in which, like I said, there was not a theme forest. There were not these massive theme companies.
There was, I think, one guy who was doing it, Brian Gardner, who you might talk to. He was doing it, and I really did not inspect his business model like that at all. I just kind of launched on something that I thought made sense.
Andrew: By offering it for free, you’re saying that you were trying to gauge the market and see if there was a potential pay market for it.
Andrew: OK. All right. And so, you launched the first theme. What did that first theme look like?
Thad: The first theme was‚Ä¶ I think the key words I used were news magazine scene.
Andrew: Ah, OK.
Thad: It was essentially a big‚Ä¶ Do you want me to paint a visual picture for you?
Andrew: Yeah, I’d love it.
Thad: So, there was a big header image at the top, and then it consisted of kind of a featured post area to the left with a tab news feature to the right with a five column grid of posts that were categorized by category. And so, it gave people‚Ä¶ Actually, it’s very common now. In 2007 I guess it looked a lot like perhaps the New York Times home page for folks.
And so, they thought, wow, I’m able to make a website that others would spend millions of dollars and 20 full-time developers on. I’m able to get something running in literally a couple of hours. That was really exciting for folks. And I think there was large interest in breaking away from Word Press’s kind of tubular list of blog posts that really dominated the theme market at that time.
Andrew: The collection of blog posts published and presented in reverse chronological order was looking boring, and it was reminiscent of a little girl’s personal thoughts based blog. And people were trying to bust out of that. You and Brian Gardner and others were starting to say, hey, we can use WordPress to create these designs to look more like magazines and give the people who are working on those sites a more professional presentation.
All right. So, you published this for free. Look at how free blows my mind. It really doesn’t. I just act like. I don’t know why in this interview. It’s shocking. You offer these things for free? Anyway, so you offer it for free. You want to gauge a reaction. What was the reaction?
Thad: The reaction was positive, or else I wouldn’t be here talking to you.
Andrew: Describe it for me. What do you mean by positive? Where there a lot of people who were just downloading it? Was it compliments? Was it something else? Was it a lot of link backs that you were starting to get?
Thad: It was a combination of all of that.
Thad: We definitely started to get a lot of link backs, a lot of feedback. At the time WordPress didn’t really have the user base that it does now, but at the time it was really kind of focused on self-starters, people who knew enough about websites to get their hands dirty. And so, there wasn’t a kind of mass market knowledge about what WordPress does and the fact that it can be used as a CMS and not just a blogging platform.
The knowledge of WordPress was very small, and so it largely catered to technical folks. And so, I attracted a lot of people who had enough technical knowledge to build their own website and then probably tried it in the past. So, it was a combination of link backs, of tech folks finding stuff, of feedback both in comments and contact forms.
Andrew: Was there one that stood out? I remember actually I was in Argentina, just moved there and started doing interviews on a daily basis and wondered if anyone was even noticing them. And then, I got this great e-mail. I remember showing it to my wife in bed before we went to sleep. I said, “Look at this. This work that I’m doing is starting to have a real impact. Look at how it’s affecting this one person’s life.”
I don’t remember the e-mail specifically, but I remember our reaction to it in that moment. We felt like, yeah, this work here, Mixergy, is doing something. It’s changing this one person’s life, and we can do it for others. Was there someone like that? Was there a single incident like that that you remember that was an indication you were on the right track?
Thad: There were a couple of tipping points that I had.
Andrew: Share one.
Thad: One was when‚Ä¶ Well, for me I was never really interested in numbers and financial statements, but what did interest me was when people who were recognized talent in their market started finding my stuff, and they chose to port their websites to one of my templates. That meant a lot to me, a lot more than the number of sales that I had in one day.
For me, it became apparent that I was on the right track when people in my own industry, which was photography and multimedia, started utilizing my templates, a guy from the New York Times, people from the Washington Post. And so, that was my world back then. That meant a lot to me, and that’s why I decided that this makes a lot of sense to pursue full-time.
Andrew: I see. Now, you say it made sense to pursue it full-time, but this was 2007 when you founded the business. 2008 to 2010, as I understand it and I’m looking here at my research, you were working as a multimedia producer for USA Today. If this is the business that’s doing well, that you’re going to grow, why take a job at USA Today?
Thad: I guess because that’s what I knew, and I was comfortable doing it, and I was pursuing kind of parallel passions. I was really interested in journalism. I had some success in that industry and thought that that was my path. That’s what I had known for the last ten years, and I still have a great deal of passion for that trade.
There was a question that one of my editors at USA Today asked me. It was, hey, we’ve got this assignment in Iraq. We’re thinking about sending you, and that was when I kind of thought, wait a second, I’m married, I have a business on the side that I can up and just focus on 100% right now. And that’s when I decided to just walk away from journalism and focus on web development.
Andrew: I see. Up until then, were you thinking that this business, Graph Paper Press, would be a side business forever, or did you imagine that one day it was going to be your full-time thing?
Thad: Around 2009 I pretty much knew that come about a year down the road it would be a full-time business for me. At the time, when I was working at USA Today, I had two people helping me out with support related stuff. At the time it was working out. I’d go to work for 40 hours a week, usually more. I’d come home and usually put in another four to five hours at night. And so, I was working about 80 hours. I just decided that the numbers made sense to just focus on Graph Paper Press.
Andrew: OK. Let’s go back in time to continue the narrative. You launch a first free theme. You’re happy with it. You’re getting a lot of people using it. The people who you admire and whose work you’re proud to be associated with, are now using your theme to display their work. You decide at some point I’m going to make a business out of this and start charging. Was it the very next theme that you started charging for?
Thad: Actually, the first theme that I launched was a free theme, at first, which then became a paid theme. It just included theme options, which at the time was totally innovative for folks. They were able to change themes, to change design features from the back end of WordPress without having to go into template files and modify it themselves.
Andrew: What kind of changes could they make?
Thad: They could set which category showed up on the home page. They could set their header image, which now is a core WordPress feature. Those were the main two things. So, instead of having to go in and figure out which category they wanted to go here and code that up, they could just do it all through the back end of WordPress.
Andrew: I see. That’s only if they paid for the premium version of the theme.
Andrew: Gotcha. When you launched that first freebie, did you do it with the idea that eventually you would start charging for something>
Andrew: No? How did you come up with the options that you would charge for? How did you know what to charge for it? I kind of imagine that what you did was launch another theme and charge for that. You came up with something innovative. Where did that come from?
Thad: Well, like I said, at the time there was one person who I knew that was doing this, Brian Gardner. I think I probably modeled some of my pricing off of him. At the time I was providing indefinite support for products, and they were one off sales at the time. It was not a membership model from the get-go. It was a one off sale, and it came with lifetime support.
Those users essentially got grandfathered into the membership system, but I stopped providing lifetime support for products. So, the membership change happen in 2008, I believe, yeah, in the spring of 2008.
Andrew: Let’s hold off for a second with that.
Andrew: I want to understand again the first product because I don’t think that Brian Gardner came up with a theme model that was as innovative as yours. He just had a theme that was free, in fact, a collection of free themes and a collection of paid themes. You said, “I’m going to take this one theme, and if you pay for it, I’ll give you super powers on that theme.” Where did that come from?
Thad: It came from responding to questions. I was answering questions over and over and over again that, for me, I thought were very, very basic, but for people who weren’t familiar with WordPress were completely legitimate questions.
Andrew: I see. So, they were saying to you, how do I change that header image? They were asking you, how do I change the categories? And in your mind, it’s just plug a different category number inside the theme. Just open it up in a text editor, that kind of answer. You said, “Wait a minute. If so many people want this, I can charge for that one feature.”
Thad: Folks that weren’t comfortable with code had an option and had an affordable option as well. I think the first price also was much lower than the membership fee is now. I think it started at $19.
Andrew: Thad, one thing that I found, even in charging here at Mixergy, is that it felt a little tough to charge for something. The idea that online certain things are free feels like just a given, that information is supposed to be free. It feels like to many people a given. You’re not supposed to challenge it, and in my space I was challenging it.
For you, the idea that themes are free must have been something that you had to deal with that many people took as just sacred online or that it was just a given. Talk to me about how you decide to take something that’s traditionally been free, themes, and start charging for it? How do you deal with it inside?
That was the worst phrased question, by the way. I don’t know what I’m doing with the phrasing on these questions, but I’m seeing you nod, and I‚Äôm realizing the guy gets where I‚Äôm going with this.
Thad: I understand what you’re saying.
Andrew: It’s more about your answers than my questions, thankfully, because my questions, a couple of them, have been all over the place today. Go ahead. Talk to me a little about that.
Thad: That question in 2007 was even more heated than it is today. It was not common for theme developers to require a payment for a theme. For me, it came down to something very simple, and this is not a complex response. You are going to be disappointed. I make something. I put in hard work. I support you. I think that that’s worth something. That’s what my grandfather taught me, and I think that even though in the Internet you are able to download anything for free.
Anybody can download my themes or anybody else’s themes for free if they really want to. Do a Google search for it. There’s a ton of shareware and other sites, but I felt like the service that I was providing was worth something, and the support that I would help users out with. My time was worth something. My own skills were worth something, and so I decided to charge for that one product.
Andrew: I see. OK. What was the response to the fee that you were charging?
Thad: I think over the course of the last three years I might have received, yeah, coming up on four years. I might have received three or four e-mails saying, and these are from hard core, like open source people who misunderstand open source and GPL as being free and without purchase. In the course of three years, the fact that I’ve had three or four people say that, I think people accept it now. I think that the service you get from a paid theme provider is considerably greater than if you downloaded something on somebody’s website and then posted a comment hoping for support. And the comments‚Ä¶
Andrew: What about orders? How did they look? Were you getting a lot of orders right from the start?
Thad: I remember the first day that the product was made available for purchase. I remember I earned double what I made at my full-time job.
Andrew: First day.
Thad: First day.
Thad: And so, I remember thinking, hmm, that’s interesting. At the time I was engaged to be married, and I thought, hmm, this could work, yeah.
Andrew: OK. And did it sustain, or did it, after a few days, start to drop off?
Thad: It sustained up until this day. There are highs and lows. Well, there is kind of a gradual incline, but it tends to be very stable throughout the year. I think during the summertime it sometimes wanes a little bit because most are from the U.S. who buy my stuff, and they’re doing other things during the summertime. But overall, from year to year, the trend line just goes up.
Andrew: Right from the start, you were making more money selling themes than you were your full-time job.
Andrew: And it just kept going. That’s incredible. All right. Now, as you say, and I‚Äôm looking at your face and I seem more excited for you than you seem as you’re telling the story. Was it exciting at the time? Did you just say, baby, I’ve got to get a monocle. I’m going to be super rich, or did you take your fianc?©e‚Ä¶ No, of course not. At the time did you take your fianc?©e out for dinner or something? How did you feel? How do you celebrate something like that?
Thad: I’m not really one to celebrate financial success. It’s all relative, too. My small success in this little market would be peas to somebody else. I think it’s true down the road and up the road. I think that it’s awesome that a little idea I had has grown to serve a lot of people and hopefully make people’s lives easier and provide them with answers when they have questions in a timely manner. About I’m not going to sit here and toot my own horn and grin from ear to ear that when I see financial numbers, I don’t know, I just don’t.
Andrew: Then, what does? If not financial numbers that tell you, hey, this business is going to keep growing and you could possibly end up doing this full-time, what does? What excites you? I see there’s a smile on your face. What does excite you, about the business? I don’t need to know about your‚Ä¶
Thad: I love it. This is getting pretty philosophical and not related necessarily to this.
Andrew: Good, go for it. I want to know who you really are. I don’t want you to fit into my own personal view of what you should be or my audience’s view of what entrepreneurs need to be like. Go philosophical, if that’s where the excitement is.
Thad: I think life excites me. People excite me. Being active excites me. Numbers really don’t.
Andrew: What about work? What excites you about your business?
Thad: I love being innovative. I like to push boundaries. I like to help people make their lives publishing simpler.
Andrew: Can you give me an example of one time that you looked at your business and you said, “This one thing right here, it’s not everything in the world, but man, it feels great.
Thad: Can you say that again?
Andrew: Can you give me an example of one thing that made you feel really great, really excited about your work?
Thad: Yeah. I think that a theme we released called Full Screen was kind of a unique take on a WordPress theme. It kind of broke from the mold of being largely text driven and put things on the home page that allowed the user to side scroll from left to right and have their posts represented as thumbnails. That, to me, was kind of like, wow, that’s cool. Let’s build this theme into this publishing system and make it to where users can add stuff and not have to code this stuff manually by hand.
And let’s make it really visual because I’m a really visual person, and for me WordPress was exciting because it allowed me to make it visual which as a platform it largely wasn’t represented as catering to visual folks. And so, that kind of migration from thinking of WordPress as being a text driven web app or CMS into something that could cater to folks of all publishing needs, photographers, video folks, was really exciting to me. Helping make it available to people around the world has been a lot of fun.
Andrew: All right. I completely get that. I identify with that. I think all of us if we’re really working on something we’re passionate about, those little things that other people may not understand themselves or may not get excited about themselves are what keep us going.
For me, it’s finding the right guest to do an interview with or finding the right question that triggers something that gives me insight into them that I wouldn’t have had otherwise. I obsess on this stuff. We do research to try to find those key points that help us figure out who you really are and bring it out to the audience in an exciting way.
All right. So, first thing, first theme, give it away for free. It does well. People are using it. You get excited. You start charging. You instantly make more money from the theme than you do from work. You don’t say “take this job and shove it” because apparently you like the work that you did over at USA Today, but it’s time to go to the next step with the business. What’s the next step?
Thad: The next step, for me, was quitting, obviously.
Andrew: Oh, it was. I thought that maybe you continued with the theme business for a little bit longer before you quit, no?
Thad: Oh yeah, yeah, yeah. I’m sorry. You’re talking about after the first‚Ä¶
Andrew: Yeah, after the first theme, what’s the next step for the business?
Thad: The next step was once I saw that there was interest in the stuff that I was making with that one theme, I thought, well, let’s make six of them. And so, I went through kind of a‚Ä¶ I think a lot of creative folks do this. You go through a time in which you just make a lot of stuff. This, for me was December of 2007. I think I made six themes in one month, and they were similar from an aesthetics standpoint, but they had different purposes, and they catered to folks with different needs. They all shared the same kind of design characteristics, but they definitely serve different needs. And so, I made six themes in a month and then continued with the free and paid approach to things.
Thad: And then, I did that for about two more years.
Andrew: OK. Let me pause here to understand this a little bit more before we continue. You do six. Can you give me an idea of which niches they were each targeted at?
Thad: The first theme was really kind of broad. It was mainly for news magazine publishers, people who run into‚Ä¶ I used it for my own portfolio site, but if you needed to have a home page that displayed different types of posts in different ways, you would use this, or you could also use it for‚Ä¶ I said you could use it for a portfolio site, but a lot of folks used it for news magazine stuff.
The next six themes catered to photo folks, photographers, designers. Again, WordPress was still kind of thought of just as a blogging platform, so I made just a couple of tubular blog posts. This was back when widgets were the big thing. They just introduced widgets. And so, that enabled me to do some cool stuff on the home page. They were largely just geared at bloggers, businesses and photographers.
Andrew: OK. You seem to feel as you were saying that you did six next, that maybe it was too much. Was it too much? Was I picking up on the wrong message as you said that?
Thad: I would develop them differently now if I could start over from scratch.
Andrew: What do you mean? Looking back, what would you have done differently?
Thad: Well, without getting too granular into code stuff, I would probably build one theme and build trial themes on top of that. I don’t know if that makes sense, but‚Ä¶
Andrew: Yeah. Brian Gardner explained that. He said, “Hey, I found myself creating all these different themes, and any time I wanted to make a change, I had to change all of them.” He said what he realized was if he just creates one theme and then has the others be essentially skins on that one theme, whenever there’s a major change, you could just change the one big theme, and all the others automatically get the benefit of that change. I see that that’s the same thing that you would have done. What else?
Thad: What else? From a business standpoint or from a design‚Ä¶
Andrew: From launching six, one goes well and you want to launch six. My head would go to the same space. I would go, “How do I get people in here to crank out new themes every single week? We’re going to blow people’s minds.” I see that. You go six, a little more conservative than me, but you still have this understanding. If one’s good, six is six times better potentially, roughly.
Thad: That’s true.
Andrew: Tell me more about what happened after that, or how that turned out for you? I want to learn from your experience from launching multiple products after one does well so that when I do that I’ll get the benefit of your experience.
Thad: Right. The six definitely showed me that as the number of products that you release goes up, so does the amount of support and the tension required that you need to have on the back end to support those products. And so, yeah, it’s easy to think that OK, one’s good. Like you said, six is better, but from a code standpoint that’s not necessarily the case. You do have six potential products to sell folks or to give away for free, but you also have your support is multiplied by six as well.
And so, you have to be able to scale both on the front end as well as the back end as well as through marketing. And so, I would almost multiply whatever time you were spending on that one product multiply it by a factor of three for every new product you want to spin out, and that’s essentially what I’ve had to do for every product. For every new product that I add, you can multiply‚Ä¶
You’re going to need marketing for that product. You’re going to need support for that product, and you’re also going to need to develop that product, and those three factors kind of help to determine the amount of time and investment that you need. And the financial investment that you need to build something that supports that product for its lifetime.
Andrew: You know what? You’re right. I always forget about that. I see the revenue, and I say, “All right. Six more, that means maybe five times the revenue, maybe four times the revenue. Ideally, six times the revenue is going to come to me because I‚Äôm going to now add to the one product that I have six new ones but you’re right. I forget that there’s stuff that needs to get fixed, feedback that needs to get handled, issues, complaints, all need to get taken care of. And I forget about everything that goes into maintaining the product after it’s launched.
You’re now faced with all the tech support that comes in, all the extra work. How did you handle it?
Thad: I reached out to the WordPress community. I first tried to promote people who were commenting in my forum which at the time was public, and I was responding to all support requests. So, I reached out to folks in my own community on the forum, and then when that seemed to be kind of hit or miss, I decided, OK, time to hire some folks full-time for support.
I reached out to the WordPress community, found two really awesome guys, and they helped me with the business as I was working full-time. And so, it would be interesting. I’d go to work. I’d work as hard as I could with that job, knowing full well that when I came home, I had to put in another four to five hours, either in the support forum or developing new stuff.
Andrew: It’s interesting. You said that you had a message board up, and that’s where you were handling customer support issues. Is that right?
Thad: It used to be, yeah.
Andrew: At what point did you launch that, after the first theme, after the second theme?
Thad: It would have been right after the first theme. I launched the first theme knowing full well that I needed a place to manage support. At the time there were very‚Ä¶ This wasn’t like 1997, but at the time there were fewer options than there are today. I would have done it differently then, but at the time I just decided to deploy a forum, integrate it with the site and at the same time that I built the forum,
I moved the business from my personal site, which was largely a site dedicated to journalism and photography, to its own company site. That became Graph Paper Press. And so, support was relegated to a support forum, and it’s evolved since then.
Andrew: Why do you do it on a forum? I would imagine that you’d feel that if people saw the issues that you were dealing with, that they might lose confidence in your ability to solve them. And people might be too lazy to go to the forum to look for the answer. They might reach out to you anyway, and so you get all the bad and none of the good of creating the forums. You didn’t see that. Why did you decide to launch a forum with those risks?
Thad: I think that a forum allows‚Ä¶ I was open to the good and the bad. I think that that’s what helps a business. You need to hear things that are wrong. You need to hear things that are right, and overwhelmingly when folks are helped, they like it. And so, I like to turn critics into believers, and I think that that’s a fun thing in business. Somebody gets really frustrated when they’re new to something, so they post questions and they’re frustrated, and then three or four messages later they’re thanking you, hopefully. You send them on their way, and they’re happy that they have a website that works.
There is some risk when you launch a forum. You’re going to see the good, the bad and the ugly, but I think that‚Ä¶
Andrew: You seeing it is fine. You want to see the bad and the ugly, but you don’t necessarily want the rest of the world to see it, do you?
Thad: Well, that’s true. I tend to not moderate either blog comments or anything unless they violate policy, but I do think that there is some value in the criticism. From a business standpoint, you’re right. I’ve actually had people e-mail me and say, hey, there’s a bad comment on your site. Why don’t you take it down? I just think that’s kind of old school, and I think if we don’t learn from that comment or we don’t learn from something that we’ve done wrong or things that we could do better, then we’re not going to grow as a business or improve as a business.
And so, I tend to respond to complaints or tend to respond to any time somebody brings something up that I’m not thinking about, but I do think that the‚Ä¶ You are right. You don’t want people to see negative comments, but I think that the world isn’t full of positive comments. And so, it’s fine to balance those out and respond to them as required.
Andrew: OK. You said you switched from answering issues in a forum to doing it some other way. What’s the new way?
Thad: The new way is a combination. We use an app called Tender App, and it’s kind of a forum/ticketing system/fax system/a bunch of other things. It allows us to integrate with a theme really well and allows us to automatically log users in and respond to them in a timely fashion. It’s a good app for startups.
Andrew: OK. All right. You also, as I mentioned earlier and you did too, switch from charging people one offs for access to premium features. You switched from that to a membership. Why did you do it?
Thad: I did it because I wanted people who required additional support to have to pay because I was paying other folks and myself to provide the support. I needed to somehow tie that term in with a sale. Otherwise, you’re providing folks with lifetime support which I’ve tried. In the software business it’s very difficult to do because there are new pieces of software that are released that we have to keep up with.
And so, when there’s a new product on the market and a user requests support for it, we have to tie the amount of time that the user needs to some sort of term. The subscription based model made a lot of sense.
Andrew: Sorry. My mute was on. Couldn’t you then say that I’m offering this theme at a fixed price? I’ll give free tech support for the first 60 days, but after that you guys are on your own. I’ll help you get it set up, or I’ll give you feedback on your problems as you’re setting up. But after 60 days, it’s your product and your site.
Thad: Well, that’s essentially what we do now, but we tie it to a defined period of time that they have access to our support forum. That’s nice, but that’s‚Ä¶ The 60 days is‚Ä¶ How are you going to program that so that a user after 60 days no longer has support access? You can do that with a membership or a subscription model. If you already do that manually, just by kind of word of mouth or good faith, that would be challenging.
Andrew: I see. All right. What was the response to the membership when you launched that?
Thad: Well, a lot of folks liked it because you could get 20-25 themes for the price of what most people were paying for one theme. I kind of thought that most users, they need one theme. They’re here to get one theme, and I didn’t really think that it made much sense to sell one off product for one price, and they’re going to have a support term that’s tied to that one product. But then what happens if they want another product that you make?
I just felt like they should have access to all of our stuff because they have shared features that usually cater to photographers and people of one niche, and I didn’t think that they were going to need 15 different themes. So, it didn’t make sense for them to have to buy 15 different products.
Andrew: I see. Let them just experiment, put it on their site, see for themselves which feels best and keep the one that they like the most.
Thad: Yeah, OK.
Andrew: I’m looking at your pricing page right now. You’ve got a few themes for free. The next level up is $49 quarterly for the themes plus pro support. You keep the themes forever. Pro support stops as soon as you stop paying your quarterly $49 fee. $99, that seems to be the one that you’re promoting for an annual membership and then $300 for developers which, I guess, gives them the right to take your themes and put it on sites for their clients, right?
Andrew: How did you come up with the pricing?
Thad: I largely looked at what was available at the time and tried to modify it to make sense for my users. I think for a lot of folks I tried to price the quarterly subscription as the term in which they would need support. I felt like three months would give people ample time to buy the theme, get support, if they needed it, and then launch the site and come back to me with additional questions if they needed to.
The annual subscription, a lot of people might have a tough time paying 99 bucks for one theme, so I thought, OK, well, obviously, you do some math and you realize that if you don’t cancel your quarterly subscription and you’re on it for a year, you’ll pay $200 versus the $99 folks. If you think you need more support, you might go with the annual fee.
For developers, I really wanted to‚Ä¶ Number one, they’re GPL licensed, so I can’t really decide how people use this stuff, but for the developer license I saw a need for developers to actually use my stuff and then provide their customers with access to our system so that they could then ask small little tech questions that they had.
Andrew: Ah, I see. OK. So, this is so their clients can come to you and get tech support from you.
Andrew: Oh, that’s pretty cool. All right. I get it. That’s great. OK. Cool. All right. So, that solves another issue, which is because of the way that WordPress is licensed, the belief is and Matt Mullenweg came on here to talk about this. Matt Mullenweg, of course, the founder of WordPress, that you can’t sell the plug-ins because if I have a plug-in, I can give it to anyone who I want. I don’t need your permission.
Instead of charging for the plug-ins, you’re charging for support. I see. I understand why the developer price is as it is. How’s that worked out for you? Are developers’ customers coming in and asking questions? Are they actually taking advantage of the service that you offer them?
Thad: I would say very few do. I think for a lot of developers, if they were to come‚Ä¶ Let me rephrase this. I think when some people look at the pricing and they realize that they’re charging their client $5000 or $6000 to build a website that largely we built using our theme, they feel obligated to sign up for something more than just $49. It’s not necessarily something that you‚Ä¶ You can’t say, “You need to do this.”
I do believe in people having good faith, and if they do realize that they’re charging their customer $5000 for the site and they modify a couple of lines of code and send their customers on their way, a lot of web developers are OK with paying for a developer license even though they might not even get their customer support to our website.
Andrew: I see. They just want to do right by you. It’s not that much more money for them, and they’re using our themes to build a business for themselves. They say, “All right. I’m going to pay this in good faith because I put good stuff out in the world, that and the world will give me good stuff, too.”
Thad: I think there’s a lot of that going on.
Andrew: OK. I get that. All right. I’m looking here at my notes, and one thing that Ari who researched you for me pointed out was you have a deal with Pagely that seems to have done a lot of good for the business. What’s the partnership that you have with Pagely? Pagely is the company that makes it easy for people to host WordPress sites.
Thad: Yeah, they’ve been great. We haven’t really marketed it all as much as we should, but we saw immediately that there was a great deal of interest in folks who are new to WordPress to just get up and running quickly. We kind of dabbled in a WordPress multisite environment, WordPress.com, but it catered specifically to our themes and the visual folks.
We just decided that most people wanted their own environment to run new plug-ins. They wanted to be able to add new domain names relatively easily and web hosting and WordPress, MySQL databases and all this stuff sounds overwhelming to a small businessman just trying to build a website to display his photography. And so, the deal with Pagely has helped folks who might find it challenging to publish with WordPress and get web hosting.
Andrew: I see. So, this is for your clients who are buying you themes and don’t want to have to figure out how to install it and how to get hosting. Am I understanding it right? I thought it was the other way around.
Thad: Nope, it’s like one stop shopping.
Andrew: I see. Buy a theme from GraphPaperPress.com and take it to Pagely where it’s going to be up and running for you.
Thad: I’m sorry. I might have confused you. You sign up for Pagely. Actually, you sign up at Pro.GraphPaperPress.com, and that essentially is a white label service for Pagely. When they sign up there, it comes with all of our themes installed, a collection of plug-ins installed, and obviously web hosting comes with it. They don’t need both; they just need one.
Andrew: OK. How do people find this Pro.GraphPaperPress.com?
Thad: Well, that’s a good question. You may find it just on our site. We initially did a bunch of marketing. We’ve kind of scaled back from that a little bit. I wanted to focus more on theme development and get a couple of things pushed to market and then we’re going to do another push for the WordPress hosting with Pagely. Now, it’s just available on our website. In the future they’ll be able to get to it, probably through little side bar ads on various websites.
Andrew: All right. Here’s what my research has shown me. You got a hundred paying customers of this hosting product within 15 days. Within 15 days, that’s how many you got. It took Pagely three months to get that many paying customers when they launched. So, you have a very powerful audience there.
Thad: Yeah. One of the benefits of running a freemium model is you’re able to see and communicate with folks who have expressed interest in your stuff in the past. Your list is able to grow, but you’re able to market, too. We have about 130,000 subscribers. That’s a pretty substantial list of e-mails, too, at least for us. We initially launched, and we communicated with these folks and said, “Hey, this is really cool. If you’ve ever had a tough time doing this, now’s the opportunity to do it and do it really quickly.” A lot of people jumped at that.
Since then, it’s kind of tapered off, but it has provided a good outlet for folks who might have a challenge with publishing.
Andrew: OK. All right. Final note that I have here is about where you learn. You know what? I said in the beginning of this interview that people are going to be listening to you, studying your story and bringing it back to their businesses. This is where they come to learn. Where do you go to learn?
Thad: Well, two different fronts. I actually just got back from San Francisco. I went to a conference, a WordCamp conference. I think it’s really good to learn live. I love going to web conferences. Future of Web Design is coming up in New York. I would recommend getting to know various conferences and attending those.
From a web development standpoint, I’m a big user of AListApart which is a web development site that also sells books on some new techniques when they come out. From a business standpoint, I read a couple books, all of which they’re going to escape me right now. I read a business model book that was really fascinating that kind of explored the freemium model, but I think that most tools are going to be available online.
I think your site does a great job with informing entrepreneurs, but from a code standpoint AListApart, Smashing Magazine usually has good tutorials. It really depends on what exactly you want to work on, if you want to work on the business side of the software or do you want to work on code stuff.
Andrew: You know what? I should not have brought up your website as you were talking. It’s a beautiful frickin’ site. I love good design now. You know what? I never used to care about design, but now that I’ve gained an appreciation for it, I’m in awe. I’m at the stage of my design education where I went from not appreciating it to noticing it to now being in complete awe and almost fear of it because I feel like I can’t product‚Ä¶
I see this one rocker you’ve got on your home page. I don’t know how you made that photo look as good as it does, but I love it. And now, I’m just intimidated by it. Hopefully, in time I can come up with design that’s close to as beautiful as that is. It’s a great website. It’s a great story.
I want to thank the guy who introduced us. This is Ben of Site5, the hosting company. He’s a really good friend of mine, and he introduced the two of us. I was hoping that we’d get to meet in person before this interview, but we didn’t get to do that. I still hope we’ll get together at some point and have a drink.
Ben is a premium member like so many other people, and if you are a premium member like Ben, then I want you to know that we’ve got this great frickin’ course, and I hope that we did a good job in explaining why it’s so good with Derek Halpern of Social Triggers. If you go to Mixergy.com/premium, it’ll be there in the next couple of days. The guy is so good at creating content and then getting people to come to the website and talk about it over and over and growing traffic and getting tweets.
And then, this is what I’ve always admired from afar, but he came in to teach how he does it. He shows how he gets those hits to become leads, to join a mailing list, and how he gets them through the rest of the funnel and converts them. The tactics that he uses are so clever that I don’t know how to express how clever they are without actually saying, go watch it. If you’re a premium member, go do it. If you’re not, you’ll be able to sign up for a premium membership. Look at that, that I also have a premium membership. It’s all about the membership, right?
Thad: Yeah, I need to learn from you.
Andrew: [Laughs] I’ve got to do a whole session on just how to get more members. The thing about members is that‚Ä¶ You tell me if you found the same thing in your business. When someone is just a hit on my website, I don’t really have much of a connection to them. They don’t have much of a vested interest in my work, and they bounce right out often.
If they give me their e-mail address, whenever I send out an e-mail, I get a response from them. it shows that they have some history with the site. That shows that they have some connection to it, that they help me with certain aspects of the site, based on what they click on from the e-mail that I sent out. Of course, if they’re a premium member, they really just want to help out and support and introduce me to people like you. Tell me, have you found the same thing?
Thad: For sure. A lot of people I e-mail don’t realize they live down the street from me, which is kind of cool. We have a big list, but there are lists of folks where I share a common interest with them, and we’ve used it to communicate for not only products that we do but things that we think would be useful for them. They’re outside of any sort of marketing thing that we’re doing for our own stuff.
And so, I think if you communicate with folks, it’s important that you be honest and go beyond just your own business model. Think about their needs, and I think they’ll respond to you frequently if you’re giving them good tidbits from outside your own ecosystem.
Andrew: That’s good. I’m starting to learn that, too, just think about the person and not necessarily about the site that you have. You might not even send a link to your site, but say, hey, I know what you guys are going through. I think this other link over there might be useful, or here’s a solution for a problem.
All right. Thank you so much for doing this interview with me, and thank you all for watching. Check out GraphPaperPress.com but not when you need to focus on anything because it’ll just keep taking your attention back to it.