Growing to $10k/mo by Developing an Innovative Business Model

Tell us about yourself and what you're working on.

My name is Ka kei Ho. My experience includes being a professional online poker player for over 5 years and running a family restaurant.

As an online poker player I realized that I could play poker from anywhere in the world, and I did: Buenos Aires, Bangkok, Phuket, and Bogota, were some of the cities that I visited while playing online poker for a living. When I came back home I started a small restaurant with my dad. He was running the kitchen, and I was running pretty much everything else.

My main focus today is completely different, but it's an inspiration from the past. After helping my dad with the restaurant, I founded Kapa99.com, where we focus on providing ongoing graphic design help to small business owners and marketers. Kapa99 is especially geared toward those that need simple graphic design tasks for their own product, business, or marketing campaign but can't afford to have a graphic designer in-house.

How'd you get started with your business?

Kapa99 was initially an experiment. Our goal was to solve the problem of "I need reliable ongoing graphic design help" in a different, much better way.

By spreading the tasks amongst a small team of graphic designers, you'll get more reliability compared to a single freelancer. And by having a few brands per small team, you could offset the cost and make it worthwhile for your graphic designers as well as for your clients. So our idea was not exactly about solving a problem, but more about changing the economics and business model of hiring a freelancer.

I validated the idea on myself first, by actually having someone work for me in a similar fashion. By putting 2+2 together, we realized that some other people might have the same problem I did, and would want a similar arrangement. I posted the idea on Reddit (on a sub-reddit dedicated to starting online businesses), where most people seemed to like the idea and were actually eager to try a service like this. At this point I knew for sure that people had the problem we wanted to solve.

At the time I started, most of my income was tied to the restaurant business. It was good, stable, and decent, and having that financial stability was really helpful, because it lowered the stakes. All I needed to get started was a domain name and hosting, and when I started I only had one designer by my side. A month in, we got our first paying customer!

How'd you find the time and funding to build your business?

Having access to tools like WordPress and Trello saved us a lot of money, and still does.

It took me about 8 hours to put a website together. It was a really basic HTML template with PayPal to process payments. Today our website runs on WordPress, and it's still really simple. We've also leveraged tools like Trello to keep tasks organized — we don't think we can build a better Trello and most of our customers are already familiar with it, so why reinvent the wheel?

At the beginning, I had an 8-5 schedule working at the restaurant, and I'd use my free time to find ways to market the service. This was the hard part. So having communities already in place for people that might want this service has been a huge plus.

How have you attracted users and grown your business?

At the beginning we found users on Reddit. I was active in a community that dedicated itself to starting online businesses from anywhere in the world. I realized that these same people would be my target market, and so I found similar Facebook groups and joined them.

I didn't spam people or groups. Instead what I did was if someone asked for help and/or guidance with graphic design, I would explain to them their options: (a) find a freelancer, (b) hire a graphic designer in-house, (c) crowdsource or (d) maybe try us out. After that I'd let them decide. This eventually snowballed to customers recommending us to their friends, and their friends to more friends, etc.

We played with Facebook ads for a while, although the results weren't great and perhaps the campaign wasn't well-designed from a strategy point of view. As of today, most of our marketing is done by word of mouth, and we prefer it that way.

What's the story behind your revenue?

We started charging from the very beginning, and it couldn't have been otherwise. The difference in our approach is the business model (a subscription service), and the only way to actually assess the market was going to be by charging customers.

Our initial pricing was $199/mo, then we increased it to $299/mo, and as of today it's $399/mo. For our payment system we kept it simple and use PayPal.

Today we average about $10,000 per month in subscription revenue. By the end of 2017, we'd like to double our revenue and keep our retention level high. Our churn is very small, and we have very loyal customers, so we'd like to keep it that way.

If you had to start over, what would you do differently?

I would've automated some things that we do internally that are now automated thanks to Zapier. It saves us so much time!

What have been your biggest advantages?

Not having to worry about my "startup" being successful (because I had a stable income) really helped in terms of mental stability and ambition. Having a safety net is often overlooked.

What advice would you share with aspiring indie hackers?

Start early, leverage all the tools available for free, and don't spend too much money on your MVP. You'd be surprised what you could get in terms of "product" for $100, especially if you have some technical skills. Set a budget for yourself and don't spend more until you start earning some revenue!

Also, I've read a ton of business books, but The Personal MBA and The 7 Day Startup are my go-to recommendations for aspiring business owners. The latter was a huge inspiration for me at the time I started Kapa99.

Where can readers learn more about Kapa99?

Check out our website at Kapa99.com, or leave me a comment or question in the comment section below!