Nathan Barry (@nathanbarry) has grown ConvertKit from $7M to $27M since I last spoke with him three years ago. He’s done several things in the last few years to grow—including making ConvertKit’s first acquisition and riding the wave of the creator economy. But mostly we’ll discuss how incremental improvements over eight years is responsible for the email marketing tool’s compound growth.
• Follow Nathan on Twitter: https://twitter.com/nathanbarry
• Find and build your audience with ConvertKit: https://convertkit.com/
What's up, everybody? This is Courtland from indiehackers.com and you're listening to the Indie Hackers Podcast. More people than ever are building cool stuff online and making a lot of money in the process. On this show, I sit down with these indie hackers to discuss the ideas, the opportunities, and the strategies they're taking advantage of so the rest of us can do the same.
All right. I'm here with Nathan Barry, the founder of an email marketing platform called ConvertKit. That's what I use to send the Indie Hackers newsletter out to about 80,000 subscribers three times a week. How's it going, Nathan?
It's going well. Thanks for having me.
Yeah. Its’s been a long time since you've been on the show, I think it was May 2017 or something. You're doing $7 million a year in revenue with ConvertKit. Obviously, things have changed to an extreme degree since then. I think you’re at something like, correct me if I'm wrong, $28 million a year in revenue today, which is nuts.
Yeah. $27 and a half million ARR. It's definitely grown. Yeah. That's the magic of compound growth is that you give it four or five years and a lot happens.
It's absolutely crazy. And I bet you feel pretty different, too. One thing I think that's interesting being in your position is that most people I talk to who once they hit a mill to mill a year in revenue, they’re kind of like, alright, I'm going to stop doing the whole transparency thing.
It's enough. I don't really want to feed my competitors this information. I think in your situation the other big players in email marketing, they're not really that transparent. You know, I don't know their revenue numbers. I don't think anybody knows the revenue numbers. Yeah.
Well, it makes sense to me that a lot of people stop. I had two good friends of mine in the business space, who I think a lot of people in the Indie Hackers community would know, at a conference who sat me down and was like, Nathan, this is an intervention.
You know, the public numbers were cool up to $50,000 MRR, $100,000, $200,000. I don't know what, but it's time to stop. You're giving your competitors way too much information.
We actually had two different competitors. I didn't tell him, thanks for that. That's they were basically saying, it doesn't serve you anymore. Stop doing it. I think they had really good points.
From the business perspective, the whole building public thing, which is really trendy and popular now, we've been doing that since the beginning. What ends up happening is the numbers get misconstrued in some way, they get quoted in a way that isn't accurate.
I think Buffer stopped sharing their numbers on a public Baremetrics page because they changed how they're calculating MRR. You just get into a bunch of weird things and still aren't quite as accurate. They moved on. Buffer is still public with their numbers, but in a different format.
But then yeah, you get into Transistor, Right Message, a ton of other companies have all sort of been like, great, now let's pull that back. So, I think that makes sense. I would not recommend that companies share their numbers publicly, unless you're doing it for a mission perspective.
If you're doing it for the marketing or the stats, or the attention that will get you, that's a short-lived reason. For us, our mission at ConvertKit is to help creators earn a living. That's what is on this tiny little plaque sitting behind me, you know, it's on everybody's desk. It's through and through everything that we do.
Partially that's in building the software that we build, the training, education, everything else. But I think of it as being able to leave, our public metrics are leaving breadcrumbs for every other founder who will follow us.
I think we've all done this. We're piecing together like, oh, at this fundraising announcement and then over here, the founder said this, and I wonder about the growth curve was between that. And like, okay, that's 37% annual growth, maybe roughly, or you're extrapolating things from if they said user count and revenue was, actually did this with the company today, I can talk about Active Campaign Launch.
They just announced that $250 million funding round today at a $3 billion valuation. And I was curious what revenue was and they didn't say what it was, but a year and a half ago or something, they said that they were at $90 million a year in revenue and X number of users.
In the new funding announcement, they said how many users they were, and so I'll extrapolate it out. They're basically $145 million ARR. You do a lot of that kind of thing with companies that drop hints of public information at spots.
What I wanted to do is for any founder coming along who goes, okay, I'm at $20,000 in MRR, and I'm really struggling with churn. What was ConvertKit's churn when they went from $20,000 to $50,000 of MRR. You can actually go in the dashboard and go back and find that, or just showing that path.
I remember when I was at $5,000 MRR for ConvertKit, I thought getting to $50,000 would be the most incredible thing. If someone said this business is going to be making, you know, $2.2 million a month in revenue, X number of years now I would have been like, there's no way that like, that's just not even possible.
But a few people like Chris from Wistia, Wade from Zapier, being friends and sharing some of their growth numbers more privately that made me think, oh, wow, this is actually possible.
So, I want to do that for everyone else and say basically you can grow a company to $27 million ARR and more totally bootstrapped and let me show you all the way along. That's what makes it worth it to share numbers publicly. But if it was just for the marketing, it's not worth it.
I wonder if you feel like that comes back to you in a concrete way. You, pre-pandemic, had the Craft Plus Commerce Conference in Boise.
I've been out a couple of times. That's where you get to actually interact with ConvertKit users and fans on the ground. You interact with founders and people creating stuff. Then there's sort of the internet version when you're on Twitter and people might DM you and talk to you.
But probably the vast majority of people who look at ConvertKit's metrics and compare to their metrics and use that to educate themselves, probably never say anything like this is sweet and they'll just use it. You'll never hear a single peep from them.
Yeah. I think other people are sharing their metrics. Specific examples would be Ruben Gamez from BidSketch, Amy Hoyt with Track All the Time tracking tool. Oh, impactful ones for me were Sasha Greif and Jarrod Drysdale back in 2012, when they launched eBooks and shared all the metrics publicly.
That helped me so much that my mindset has always been, I'm just going to pay it forward and always share my numbers publicly. And so again, when you make a mission driven decision like that, then it's easy and you don't have to get into weighing the pros…
Payback, what happens after that?
Yeah, exactly. The other thing is there's this weird thing that happens where there's a lot of metrics public about companies that are saying, “Zero to $25,000 MRR”, or like just getting started, right.
Someone's tweeting like, oh, I just passed $3,000 MRR on Twitter and everyone's celebrating that. That's amazing. Then you have, Squarespace's S one, which came out the other day. You get to see on that level, or Shopify or whoever else, like Salesforce, you can go look up anything you want about their metrics, you know, they're publicly traded.
You end up with information down here and information all the way up here and then just nothing. You're not that in between. Yep. And so, I'm like, hey, I'll be one of the companies that's like shows numbers in the middle of the journey.
That's super cool. It's Indie Hacker’ bread and butter. The stuff that works the best for us on our forum is people posting success stories and doing AMAs, and usually sharing their revenue numbers because it gives everybody kind of the chance to see.
It's like you said, it's a lot of people in the bottom, not very many people in the middle, a lot of people at the top. At the bottom, I think people just don't care because they're like, well, it's not that much who cares.
Then the middle is kind of like, well, I don't want to publicly tell everybody that I'm rich. I don't want to get robbed. I don't want people to ask all these questions and send me all these weird offers.
At the top it's kinda like we're going public or we're super mission-driven or something, something else that's different.
At the low end, it's like, that's just barely covering your salary or something and so it's great. At the high end, everyone knows, you're not as the founder, you're not taking that money home.
Yeah. So, it's divorced from you personally.
It's this big company with hundreds or thousands of employees. But in that middle stage, if you were to say, oh, we're making $8 million a year, people are like, wow, you are making $8 million.
No, the company is, and we're spending it all to build the product and everything and pay salaries. People have a hard time separating that. I think that's, that's part of the challenge
I've been looking at what you've been up to you as an individual. First of all, you seem super mellowed out. I've never seen you as mellow as you are right now. You feel like you are just high on life. Everything's golden. You don’t have a care in the world.
But on the flip side, you seem like a supercharged Nathan online. You've sort of rebooted your podcasts in a big way. I think you've done more episodes this year than almost every other year combined. It's the Nathan Barry Show or The Art of Newsletters. It's kind of got two names.
Yeah. It's got a season of the Nathan Barry show.
Oh, okay. That's how it works.
Because I didn't want to fragment the audience. I still had the feed I wanted to get going. I didn't know if I want to talk about newsletters forever. It was like, I want to talk about newsletters for the next year, for sure. So, let me play with that of it's Art of Newsletters on the Nathan Barry Show.
Well, newsletters are obviously back in a pretty big way, so it's a good time to get into newsletters.
On top of that, your blogging is beautiful, sort of encapsulates everything that you're doing, not only blog posts, but also your podcast, your books and your products, and stuff. And you've got like a weekly newsletter that you're sending out that I'm subscribed to you that's super helpful, too.
All of this stuff is, if that was literally all you did, that will be a lot of work. It's a lot of work, maintaining a podcast. It's a lot of work doing a newsletter. But then you also run this like 27 and a half million dollar a year SaaS company, which is crazy.
You're super chill on the outside, but what you're doing behind the scenes is crazy supercharged.
There's definitely a lot going on. I actually had to swear off new projects for the rest of the year because it was getting a little bit out of hand.
Someone on my team, her name's Elizabeth, she's my executive assistant, for the last four years now, she was like, dude, you gotta chill.
I'm doing things, because the other thing, I do have other things. We have a whole farm that you know of where I live. We expanded that, so it’s now nine acres. We also own now 14 Airbnb’s. Not to make it more ridiculous, but I just started a new business running a local newsletter for Boise, the city that I live.
Didn’t you buy a town or something, too? I feel like I remember watching a YouTube video where you're like, it's starting a new town from scratch.
I'm just an investor in a town, in a ghost town called Sarah Gordo in the kinda near mammoth in California.
So, you’re doing like 18 different things and they're all very different and all very hard. Every one of those seems pretty hard.
Well, the trick is to partner, to either hire great people or partner with people on everyone.
At ConvertKit, I feel a lot more chill about because now we've built out an executive team. They're the ones pushing me rather than me pushing them.
Then on the Airbnb’s or other things, the Airbnb’s I have partners on. That's been fun to have a real world, like take internet money and put it into something tangible. Then also just to have a tangible product to sell, like an in-person experience rather than a digital one.
I see you’re crowdsourcing help with Airbnb on Twitter. You had some question the other day, like what's the best possible experience you can get as a guest, as an Airbnb? I was like, yeah, I replied, I was like a Chrome cast in the TV, so I can easily play music in something. There's a bunch of other good suggestions.
Yeah. It's the same thing. I'm obsessed with user experience and product, so I want to do the same thing in real life.
So that's the Airbnb’s, you got the ghost town, you got the newsletter for Boise, and then you got your own personal newsletter, which I think is probably the most like relevant side project to what you do at ConvertKit since obviously ConvertKit powers everybody else to have the newsletters.
What's the thinking behind starting a newsletter because actually I do have a Courtland Allen newsletter that nobody knows about that. I never send any emails out to, but I really wrestled with it last year. Should I start this back up? What's the benefit? It seems like a great way to own your audience.
Yeah, I definitely wanted to be producing content myself again. ConvertKit was producing all this content, but I felt really detached from it. There's some things that as an individual, you can just do better than a company can.
For example, let's say I wanted to get on, I dunno, CBS or “The Today Show” or something, right, do national TV as a way to promote ConvertKit. There's not a good path to do that as ConvertKit.
But as an individual, if you were to write a book and then go on book tour. If the book was like creator economy, any of this stuff they're talking about, that's a very normal path. You're like, here's James Clear, the author of “Atomic Habits,” who is on his press tour; let's have him on TV.
There's interesting things where sometimes you have way more leverage as a company because you've got the team, the brand, everything else, it has hundreds of thousands of users and all that. Then other cases where you have more leverage as an individual.
I started to look for that balance and basically what I found is in restarting the newsletter, I can piggyback a bit off of the company, and also, I can build connections with people. That's restarting the podcast. It was really building connections with people, having a lot of conversations in this space and using that to feed a lot of content at ConvertKit.
The thing in the newsletter is I have these long form essays that I love to write. A few of the big ones are “Ladders of wealth creation,” “The billion dollar creator,” where I'll put months, into writing them, getting friends to read it and everything else.
I would have this thing where I would publish nothing at all and then drop one of those and then nothing at all. I wanted a way to bridge that gap. I knew I couldn't write one of those every week. There was just no way that was happening.
The curated, this is what I'm up to, this is what I find interesting newsletter was a way to say, hey, every Tuesday I'll show up in your inbox, I've got useful stuff for you. Maybe once a month or something, that's going to be an essay. Once a quarter, one of those essays will be something that's a flagship piece of content.
But one thing that's been weird is if you'd let your site go dormant, turns out all your traffic goes away. So, you know, surprise. I built the email list to, I think 28,000 people. Since I've restarted it, it's just gradually shrunk down to, I guess, just 25,000, 26,000, because you know, every time I send, I lose 80 people, but I'm only getting eight new signups a day because the traffic isn't there anymore. I haven't yet retooled that.
The curse of the newsletter send, where the churn really happens when you send an email. So, if you want to send an email to engage people, but the lowest churn newsletter is one where you just have a signup form on your site and then you never send any email. The list just keeps growing and growing. No one ever unsubscribes, because you never sent an email.
This whole idea of what's the best way to get the word out, a podcast, a blog. Being an author, writing a book, you know, going on talk shows is super interesting. I was talking to my brother about this today because let's take books for example.
Books are the most sort of legitimate way to communicate an idea, right? It's the most professional way. If you tell people you've written a book, they’re sort of, you know, they get starry-eyed and like, oh, this guy's legitimate.
But most books that I've read, like I read “Sapiens” years ago. I can tell you like one idea I got from sapiens, maybe four or five facts. Homosapiens is 150,000 years old. Shared fictions are a good way to keep large, disparate groups of people together. But that book was hundreds and hundreds of pages long.
Whereas last week, I have another podcast I'm starting up with my buddy Julian. We had Tim Urban on, and another guy named Jason Silva and we were talking about identity and stories. Tim was like, there's this Paul Graham essay about your identity. I was immediately like, “Keep your identity small.”
He's like, that's the one. We both recognize the exact same essay, the exact same idea. That essay’s, I don't know, like 800 words, took a 10th, a hundredth as long to write that essay as it does to write a book, yet it communicated with the same force of the idea.
I like the blog approach, or the newsletter approach really, these 600–800-word essays where you can really have an impact, but it's not going to take you six months to write it.
I would challenge that sometimes those short essays take the longest to write where you're really putting a lot of thought into it, because there's an idea that you're wrestling with.
This is one that I want to write about is what is the most impactful place for your, well, I was going to say your writing, we'll run with that, maybe it's your effort overall. But if I'm trying to spread an idea, how should I best package it? Where should I put it?
Cause I could sit down and write a thousand words and is that best placed on Twitter, in a super polished essay, in a whole combination of various random blog posts, in a book? It's something that I think a lot of indie creators in particular struggle with is where should I apply my effort?
There's very different leverage in each place. One thing that I realized for me is my effort, I believe, should go into a book because I think that that will be a step function in the type of audience that I can reach all that.
The next blog post is not the most useful thing; I should publish the book. That’s the idea behind that. Not the idea behind the book, the idea behind where should you put your effort or your writing your creativity for the most leverage, I think is a really interesting concept.
I have a bunch of different notes on it, but it's not ready for an essay yet. It's going to bounce around in my head for another four or five months, and then I'll write down the 800-word essay, hopefully that people will reference for a long time to come.
I like that bounce around phase, too, because you could have a lot of conversations with other people who are thinking about the same thing, and you have these insights and they put ideas inside your head and you're reading other essays.
Then eventually, you know, you sit down to write, and things sort of clicking, but it's because of all these conversations and all this time that it spends marinating, et cetera. You're right. Those things like don't really write themselves.
Having those friends who you can refine ideas with are really important. “The ladders of wealth creation” post, I probably wrote it over the course of a year, but it was really three different conversations with James Clear where we were talking about an idea, and I wrote notes and then later I like built on it and sent it to him.
He's like, that's good. That's interesting. I'll think about it. When we get together, we had, we're going to be in person again in a couple of weeks, we’ll chat about it then. Then on a drive from the airport, he was like, okay, here's my thoughts on it now. He edited it down later at the end, he was like, this is amazing, but also cut out all this crap. What do you mean? What are you doing with that? It doesn't add to the point.
Having someone like that, you know, with James or Barrett, who's our COO at ConvertKit, really riffing on these ideas and letting it build for a long time.
That blog post got super mega shares. I feel like everybody read it and it's long, I just put it in word counter.
There's another Paul Graham essay that I really like called “How you know,” and it talks about like the benefit of reading. Even if you forget things, it's still good to read cause it kind of changes things that you don't even realize are changing about your mindset. That blog post is like 600 words. “The ladders of wealth creation” is like 6,000 words. It's like 10 Paul Graham essays all in one.
Yeah. I struggle with that of how should you share the information?
I love what Eric Jorgensen did with “The Almanack of Naval Ravikant”, because he took all this information that was out there and put it in this format that we, as a society value and find easy to consume.
It'd be amazing if someone did that with Paul Graham, where he's got all of these 800-word essays and put it into a consumable format. So, it's not just on this website that was designed in 1997, never updated.
Put it in that format and it can be this whole collection of essays, similar to how Jason and David from Basecamp write, or Derek Sivers writes. It'd be this short little book, but I would love that.
So, yeah. Test your ideas in essays and then later package them and put them into a book.
So is that your plan for a book if you're going to write a book? It sounds like you're sort of set on a book, to write little essays and then test out which ones are good and compile them into a book. Or do you want to just sit down and start to finish huge book?
I'm kind of doing both at the same time and we'll see which path works better. I like short books, you know, I like the ones that take a few hours to read. That lends itself well to shorter essays
Yeah, same thing. One of my favorite books is “The Mom Test.” I did a podcast with Rob Fitz, the author of “The Mom Test.” You could listen to the podcast or in the exact same amount of time, you can read the entire book. You’ve got no reason for the podcast to even exist.
That's why I'm super bullish on these short essays or these really short books where you just get the idea across and he idea like really sticks.
It was a great book. I've talked about it on the podcast a little bit, but Sam Parr turned me on to it. He's a huge fan of it. I know he was on your podcast recently. It's called “Made to stick.” It's literally, have you read this?
I haven't read it. It's on my list.
It’s great. can't recommend it enough. It's literally just an analysis of what makes ideas stick and a big part of it is story. There's six principles and the sixth one is story.
The other ones are simplicity, credibility, concreteness is a really good one. If you're talking about sort of abstract ideas, it's really hard for people to remember that. But if you'd put really specific examples, you're talking about an apple or a fox trying to catch a skunk or something. People just, for some reason, our brains are wired to remember it.
I remember your story when you were like, God had to be like, when you're writing “Authority,” so it's like 2013. I remember looking at your newsletter and I was like, ah, Nathan's so inspiring but everything he does seems exhausting.
That's what stuck with me. I was like, it seems so exhausting. I mean, this newsletter, it seems like he's running so fast. I just want to code, nap, in my pajamas and press a button. I was like, okay, like this Patio 11 guy resonates with me a little bit more, but I remembered your story because of the exhausting part.
Yeah. Cause I was writing a thousand words a day every day.
Yeah, I did not want that for myself.
You had a tweet recently, and I want to talk about ConvertKit because we're talking all about newsletters and writing. Your tweet was very interesting. It came from a blog post, I think on the Harvard Business Review that said there's really only four types of value propositions that companies can have.
Best quality. This is Louisville slugger, the best bats or something like that, or the best phones from Apple. Then you get your best bang for your buck. That's the cheap stuff, IKEA, Chipotle, Toyota.
Number two is luxury and aspiration. The Rolex's, the goods that people aspire to have to kind of show off their status. Then number four is a must have, you just kind of have to have this. That's Stripe or some sort of server tool you install, and you set it and forget it.
Arguably it's ConvertKit, you know. O kind of have to have to have something to send my emails with, but then you have a ton of competitors who might be like, okay, we're the best in class with a luxurious email marketing tour. We're actually the best quality.
How do you think about ConvertKit fitting into that framework?
Well, I tweeted it because I was sitting with that question myself, and I want to see how other people were handling. Of course, everyone took the tweet as oh, let me point out all the other types of things that there are.
I was like, well, just go read the HBR article where they talk about how like, great, but those all kind of boil down to the other four. My favorite reply, two different friends, Brian Delk and Sean Blank, both apply. And they were like, all four of these describes Chipotle.
Chipotle is an aspirational product, best in class, best value, highest quality, you know, like everything. I was like, alright, I can agree with that.
I was thinking about ConvertKit's value proposition and it's hard to be all of those, unless you're Chipotle. Which one are you trying to be? I think you want to be a must have, but honestly, if ConvertKit didn't exist today, Indie Hackers would run fine on MailChimp or something else. That gets into the question of how disappointed would you be if this product didn't exist, which is sort of like the product market fit question.
I think it's such a competitive space, email marketing. It's really hard to be the must have. I put Stripe down on the list of one that I would put as a must have because I just think that no one else has come close to competing with that.
It's kind of funny, right? As all these platforms are launching payments and should you do payments on Substack or clubhouse or ConvertKit or TikTok, wherever else, and Stripe’s like I don't care. You all fight, we'll just take a cut of everything.
Yeah. You're the boats. We're the ocean. That's cool.
I think the must have is really hard to do in this space and where I ended up is I want to be best quality. That's where we want to position ourselves with some of this aspirational element to it.
One thing that, actually Barrett or COO wrote down in his notes is, your favorite creator’s favorite marketing tool. It's sort of the best quality aligned with this aspirational side of things.
I think Apple does that really well. You look at all of their marketing and it's the producers and the artists and the musicians and all of that that they're featuring in their marketing. You're sort of like, oh, I'll use this so that I can be like Finneas, the music producer, or whoever else.
That’s where I ended up on that and that drives pricing decisions. Should ConvertKit have a $9 plan or a $15 plan instead of starting at $29? I think it's like, well, if you're gonna be best quality, you don't have to compete at the very bottom end of the price.
I don't have concrete answers, but I have a whole lot of notes about which would be best.
You said something that was really interesting. It resonates with how I think about Indie Hackers, which is that you want to ConvertKit it to be your favorite creator’s email marketing tool.
The bread and butter of Indie Hackers is sort of aspirational, inspirational, share stories. I've seen you've done a lot of stuff around sharing stories. Previously, before hearing you say that I'm like, why is ConvertKit sharing all these stories? I don't know. I don't understand their content marketing strategy.
You've got books featuring creators. You've got your conference where people, creators, get on stage and talk about their stories. You sent Isa out to interview me, I think a year or two ago before the pandemic.
You guys hired a professional photographer, you did a whole interview with me that wasn't really about ConvertKit. I think I barely mentioned that I did ConvertKit. I was just like, yeah, people like Courtland, they'll read a story.
You've got a lot of really good photos on there. Actually, quick aside, you had a professional photographer come out, take a bunch of photos of me. You put them in an Unsplash album or something. I've literally every single week I get like five people who are like, why is your photo on this random website selling speakers?
Every SaaS startups, just like, Google Unsplash black guy on computer, black guy on podcast or something's going on like that. My photo’s all over the web.
That photo of you on Unsplash is insanely popular. Well, hope it's insane. You had a super sweet studio set up, right. Sort of the, the moody lighting going on and everything else.
I was just on another, I was on Teachable's website, actually. It's just so funny. There was a photo of you.
Yeah. Their features page. I get that all the time. Oracle sent out a PDF of our year of interview or something. My landlord sent it to me, like, is this you? Is this my apartment? I'm like, yeah, I don't know how it ended up there.
That's good growth hack. If you want to be an internet model, get a bunch of professional photos taken of you. I guess do some SEO hacks on Unsplash, figure out what people are searching for, and then just make an album of yourself. You'll end up on a thousand random websites.
Some of those have been downloaded like two or three million times, which is crazy.
Same reason you're doing it with Indie Hackers, right? That's the content that people resonate with. There's a couple of worlds, right? There's sort of the creator marketing, you know, become a successful creator world.
Then there's the internet marketing and the sleazy way, which is the get rich quick everything else. We want to, our mission is to help creators earn a living, which may not be that different from a ClickFunnels or someone who's like, yeah, we're here to help you earn a living.
So, how do you differ? How do you accomplish the same goal, not in a get rich quick, one weird trick to make money on the internet? You're one funnel away from, and they're basically promising that as you make money in this way, it'll solve all of your problems.
I'm like, I think you're one funnel away from a more effective marketing funnel, but I don't think that you're one funnel away from self-actualization or a better marriage or, you know, whatever else.
We really struggled with how do we, the whole goal is to help you earn a living, help you use our software to earn a living as a creator and not have it come across as all of this sleazy, basically get rich quick and actually legitimately like what you and I are trying to teach people of, you can build a real business, earn a living. There's a system and process to it.
We found that storytelling is the best way to do that. We're deliberately featuring a broad range of creators from photographers to fashion designers, to podcasters, to fitness professionals and everyone else of this is how they did it.
In the “I am a creator” book, which is the one that you're in, it starts off with a story of a lawyer turned food blogger. Actually, the fun thing is she read our first book called “I am a blogger” that one of her friends gave her, and that was the thing. She read that book and then immediately quit her job. That's why we had to feature her in the second one.
Doesn’t that feel crazy that people are quitting their jobs because you put out a book and someone's like, I'm going to change my entire life because I heard a podcast episode. I read, this is a side project that I made.
Right. Both wildly inspiring and absolutely terrifying simultaneously. It's basically, we think storytelling is the best way to accomplish that. We're just trying to do it as much as possible.
There's this idea in Joseph Campbell's “Hero's Journey,” of talking about the different roles, the hero, the guide, and all of these brands try to make themselves as the hero of the story. And it's like, actually the most effective marketing is when you make yourself the guide.
You're trying to do it through the product and you're trying to do it through stories and examples and, and all of that. We just go absolutely all in on that. Now we have a full-time in-house filmmaker, Isa telling stories and we hire photographers and all of this.
It's crazy how fast stories spread. It's what people want to share that’s what people resonate. With Indie Hackers, we sort of stumbled onto this completely by accident because I was just doing interviews and I wasn't conceptualizing the interviews as a story at the beginning. I was sort of asking random questions and then the ones that resonated the most were the ones where the questions were kind of chronological.
People were like, well, I wanna hear the story, et cetera. Now it's the bread and butter of Indie Hackers has become. these AMS. We’re like, hey, come do an AMA on Indie Hackers and people are like, what should I write? I'm like, just tell your story. Then that person is kind of the hero of their own story.
But as a reader, you don't care about Indie Hackers and you kind of care about this person because you're projecting yourself into their shoes. You're like, wow. What she did is so amazing. How do I do that? Because it's an AMA, it's like, you can just ask her how she did it, or you can read her story, or you can share her story because it's just so much more memorable to consume a story than it is to consume a PowerPoint presentation.
That's not how humans are wired to remember and share information. Something happens in your tribe. You tell a story like, hey, did you hear about Jonas? He stole a pencil from Marie? Here’s how it went down, and you remember that. Everybody spreads it, but you're not like let me make a PowerPoint presentation of these 10 bullet points.
Nobody remembers that. It doesn't get spread. Doesn't get shared. Even on Twitter, a lot of my friends who are doing really big on Twitter, are just doing these huge threads where they just tell a story and break it into like 15 tweets. When you're scrolling through a lot of bite sized, bullet point tweets and you see a real cool story, you're going to get into that and you're gonna share it.
It makes so much sense that like that's the content that people really want. It resonates. It's just incredibly inspirational.
I'm realizing that I’ve written a lot about ConvertKit’s story, as we've gone along, but I have written one post that tells the whole arc and then jumps off to all the random content. So, I'm gonna actually go and do that because that is interesting to have one place of zero to where we're at now and highlight that. Who knows, maybe we'll do that.
It’s a post you’ll end up writing probably again, and again, cause if you're gonna ConvertKit’s story five years ago, it would be missing five years of information and your perspective will be different.
I bet you, the way you write about the early days today will be so different than you saw the early days at the time. That doesn't mean your perspective now is inaccurate. I mean, it’ll be a little bit less accurate, but it'll be okay. It'll be just more context. You'll see much more about how the world was changing, where you were and sort of the landscape and the ecosystem were at the time.
It's probably harder to place yourself. You probably weren't as confident you probably had more doubts, et cetera. So, I’d love to see you do that.
That's my favorite thing about writing year-end review posts is that you get to lock in your own mindset and worldview at that exact moment in time. Then read it again later and be like, oh, that's what I saw was possible. That's what I saw as my biggest struggles. That's what we accomplished that year.
Basically, it's the only way effectively that you get to capture exactly what you think and that worldview from that moment. Then when you look at it five years later, you're like, oh, that's funny that that was what I was struggling with. Oh, that's great.
It helps see the growth cause otherwise you just feel like you're in this constant struggle and it doesn't get any better. But if you have that documentation, either through the stories or your review posts or interviews you look back on, you're like, oh, okay. I have grown a lot.
One example is a year ago we hit the pandemic and every company leader was trying to figure out, like, what does this mean? How do we lead through this? Maybe churn is really high, but new revenue is coming in and how do we take care of the team and everything else?
I think like three years ago, four years ago, that would have been way more than I could have handled. I probably would have figured out how, but a year ago we'd been through a lot already of challenges in the company, whether it's a PR crisis or server outages or anything else.
It was challenging, but it was at that I felt I could rise to the challenge. It's interesting to reflect on the things you encountered today. You're like, oh, past me would have really struggled with this. Current me, it's like right at the edge, but I can take care of it.
You've been through a lot. I remember being at the I think I spoke at your conference where you unveiled the new name of ConvertKit. It was Seva and it turns out to be a holy word and this religion that really doesn't want you appropriating it for your company, you know?
That's a crisis that you survived that wasn't easy, I imagine. Cause like you put, I mean, it was like a really big, probably expensive, unveiling and a lot of rebranding, a lot of marketing and you go through stuff like that and you're like, you look around and you're not dead. You're like, oh, okay, well, the world keeps moving, you know? I can survive bigger and harder things.
Yeah. That was about $500,000 that went into that one. I mean, it's still a huge amount of money, but then it was especially a huge amount of money.
That's why I think it's so important in sharing numbers and work in public. In any of that, that you, you got to share the ups and the downs.
Probably one of the more painful articles I've ever published is titled “here and back again.” It's about ConvertKit's name change. I sat on that one for a long time. I actually just published it two and a half years after the name change.
Part of me was like, you know what, it's now past that, I don't need to bring any of this up, but then I've also thought with like, okay, now you work in public for a reason. We don't just share the highlights. You got to share the struggles and lessons along the way. That was a more difficult, but important post to write, to at least to be authentic and consistent.
I remember being the very beginning of Indie Hackers and my server went down for a day and I was like, oh no, my problems are the worst problems anyone's ever experienced in life. What am I going to do with myself?
I was at the top of Hacker News at the time. No one could load website and I was like, this is over. I'm gonna have to pack my bags and do you what get a job or something. Nothing happened. Everyone forgot about it the next day.
It was fine, but the challenges of being a founder, and as, I guess ConvertKit has grown, you've sort of, you're still the face of the company. I think ConvertKit, I think Nathan Barry, but I see your tweets and I see your post and you're sorta like, oh, the best thing I've ever done is no longer be product lead or ConvertKit’s easy to run. I can do these side projects because I have other people who I trust and running stuff.
You were sort of stepping away from the day-to-day responsibilities and delegating to, I assume people who are insanely talented and who you trust.
There comes a point, and this is both wonderful and challenging as a founder, where the effort that you put in doesn't have that big of an impact.
It used to be that if I sent five more sales emails or push for an extra couple hours in, I guess, Photoshop at the time, pre-Figma, designing an interface that helping you get this, this feature out that would meaningfully move the company forward.
Now I'm sort of in this place and it takes a little bit of getting used to of like, look, if you work on ConvertKit for an extra two hours today or an extra 15 hours this week, it is the tiniest drop in the bucket compared to the hours that 65 other people plus another 50 contractors are putting into building and growing the company.
On one hand, there's this bit of an existential crisis of I don't matter anymore, or this individual effort doesn't make this big difference. That can be good for a step back of like, look, I don't need to grind it out at this computer to have the biggest impact. That's where you hear a lot of people talk about like, oh, as a CEO, I started going on long walks and that was actually the most, but time to think and have space is so good.
But then the flip side, is there anything that you do on strategy, long-term thinking, setting the direction, like if you're wrong, you end up being wrong by a lot, because you just had hundreds or thousands of hours of people's time going into pursuing the wrong thing. But if you're right then, you get incredible leverage on that.
It's this weird world between you don't matter, the individual effort that you put in no longer matters. It mattered a lot in the early days. It doesn't matter now. And also, then in the other sense, like it matters more than it ever has. Don't screw it up because there's everything that you do has all this weight behind it.
Yeah. It's like a multiplier on everything you do. It's basically like your labor no longer matters, but your decisions matter a hundred X, a thousand X more than they ever had.
Which is a lot of stress because like what, even how to even describe a decision, what goes into a decision? It's just a femoral thing where you're like, well, I think I have pretty good knowledge and I think I've checked my sources and talk to friends.
You, for example, just acquired a company called FanBridge. No idea how much the acquisition was for, but I assume it expensive. This is a big company and they're, I think they do like newsletter distribution for the music industry.
Yeah, exactly. They’re email marketing for musicians, been around since 2006.
That's a big decision, and a lot of people that ConvertKit and a lot of people at FanBridge are working based on this huge decision that you made. I have no idea what even went into that decision or what your goals are, but that's probably a lot of pressure.
I mean, that was an interesting one being our first acquisition. You always have these ideas of, oh, acquisitions will be a great way to grow, or maybe there'll be terrible or, who knows what, right. You just don't know until you've done it.
Part of the reason that we did the acquisition was our expanding into the music space. I think you've probably seen a lot of that with ConvertKit over the last year in particular of launching creator sessions and doing all these live, at home concerts with musicians.
Basically, as we went in the early days from ConvertKit's for professional bloggers to now all of creators and now pushing that limit even more with musicians like Matt Carney and Tim McGraw and Amanda Palmer and others.
Then it was like, okay, musicians is a market that we can go after. How can we accelerate that? And then also, how can we consolidate the market? You know, it was interesting to play in the music industry.
The most popular email marketing tools for musicians; number one is MailChimp, number two is Salesforce marketing cloud, which is kind of weird, and then number three is FanBridge, and number four is ConvertKit.
We looked at that and said, oh, we can't buy MailChimp or Salesforce, but I can buy this player and double the number of positions on ConvertKit or more than double by quite a bit.
Yeah, that's really big moves.
I think about what we were talking about earlier, the fact that there’s these different channels that you can put the word out on it, right? That's a big decision you have to make, like, where am I going to? Not only what am I going to produce, but where am I going to produce it?
For you, it's kind of like, okay, not only what decisions am I going to make it ConvertKit, but also what company am I going to buy? What industries am I going to enter? Is music even the right industry? Is an email marketing sort of newsletter company the right entrance?
I think my very first, my very first podcast guest was this guy, Jason Grishkoff, who ran an indie music discovery blog. Apparently, there's thousands of these blogs where people subscribed to the blogs to discover music. It's just this huge force that I didn't know about. I'm like, oh, this is why everybody knows like new music, and I don't.
Y could have started there. You know, there's so many different avenues. I wonder how much of this is your passion for music, out of all the different arts out of all the different things that are. There's a huge agricultural industry in the newsletter space. Every industry is kind of in the newsletter space. Why music?
At an executive meeting, I guess it was 18 months ago now, we're all sitting in a room doing our planning. We're just talking about where we want to go next. Someone asked the question of what types of creators would we be most proud to have as customers for ConvertKit?
Everyone gave examples of musicians. It was like, great. We get to pursue whatever industry we want. We did the due diligence to make sure that it was a space that we thought we could enter and win in that. It made sense.
But then also in the your favorite creators, favorite marketing tool, in that angle, a lot of people, their favorite creator’s a musician. You think about some of the best writers are a lot of hip hop artists who are putting out incredible rap music or whatever else.
There's also sort of this leap from the internet subculture that ConvertKit is well-known in up to actual culture, if that's right. One thing that we said is we want to be powering the creators who are actually driving culture. So, music was a great place to go for that.
It strikes me as a little bit ironic that we're talking so much about these creator stories and the power of story. Then this episode is not at all story-esque, it's just randomly me talking to you. We're having a normal conversation, which is honestly my favorite thing nowadays, even though it's not as motivational as stories.
But there's one thing I want to talk about before I let you go, which is just this whole creator economy thing that's exploded. It wasn't even a term a year and a half ago. No one was saying creator economy or maybe they were, but it wasn't a mainstream brand name, VCs investing in the creative economy.
Whereas today it's like, that's literally all I hear about all the time, creator economy this, creator economy that. Everybody's got a newsletter. Everybody seems to be making money. It's super exciting cause I think people are able to generate revenue and create a business for themselves and find financial independence online without having to be a software engineer.
You know, they can write a really good newsletter and put it on ConvertKit and start charging subscribers. That's not a thing you could do two or three years ago. What's your take on the creator economy? Is this here to stay and how do you look at kind of the competition in particular, because Twitter, for example, is a huge distribution channel.
A lot of people get discovered on Twitter and they just straight up bought review a newsletter company. They're just like, we're just gonna pick this directly into Twitter, which I imagine it's probably pretty scary for like the Gumroads and maybe the ConvertKits out there. It's like, oh, well, uh, we don't have a billion people on a platform using it every day like Twitter does.
There's a favorite, I should dig up the graphic because I can picture it in my head, but that someone did of the popularity of email newsletters over time and it peaks, and it keeps going up and it's up a lot. Then they transposed in there “email is dead” headlines from the New York Times and Wall Street Journal, all the way along. It's totally dead. Everyone said it as it like 10 Xs in popularity.
Everyone has always said e-mail’s dead, social’s the next big thing. We've been fairly quietly, as a self-funded company, just building a space and be like, okay, but we're seeing people build bigger and bigger newsletters. No, we think this is a good thing. It's been interesting to be doing that all the way along and then now have this spotlight come shine on us. I had the eye of Sauron on as like an example right here.
On one hand, it's super exciting. Cause people would be like, you're starting a newsletter before and now they're like, oh yeah, you have a newsletter. I have a newsletter. Oh, this is great.
I love it because there's so many people now that would never have done that before and now it can do exactly what you and I did of build something, say to the $100,000 a year in revenue. To have a creator business that you've built up to that level is a pretty amazing life for yourself.
I think that's so approachable now. Everyone's got a little bit of a different take on it as far as how to charge, what the value proposition is, Like in Substack’s case, a paid newsletter is the way to earn a living as a creator.
In our case, we take like, Hunter Walk had this article, “The multi-skewed creator,” and that very much sums up the way ConvertKit’s approach and what we have talked about in the books and everything else of you can earn a living in the way that matches your style. That might be a course. It might be a paid newsletter. It might be sponsorships, you know, whatever else, there's a whole range of options.
Might be a hodgepodge. I was talking to Jay Clouse, and he's got, he had his own sort of accelerator he was running with 10 or 20 people he was mentoring. He also had contract work he was doing and a newsletter and a podcast with ads. Yeah, when you're trying to get to that first $100K in revenue, so you can replace your job, you might have to stitch it together, sort of this Frankenstein monster as a creator, that quite frankly is hard to do if you're only on Substack, because that's it. People get subscribed to your newsletter. You can't really sell anything else. I don't even know what they allow you to do ads.
You technically could, but they're editorially against it. But there are plenty of people who do sponsored posts on Substack and stuff.
Twitter buying Review was really interesting because it was just more validation in the space. I could end up being totally wrong on this, but I don't think that review will end up being a wildly successful newsletter tool or a competitor.
in the same way that we don't have anyone switching from ConvertKit to Substack, I don't think we're going to have people switching from ConvertKit to Review. My hope is that it will grow the pool a lot more. The pond will get bigger.
We have a lot of people who would have never thought about starting a newsletter and then they started a Substack and then they get to 10,000 subscribers and they're like, this is amazing, now I need all these features and they graduate from Substack over to ConvertKit. I will take that all day long.
Yeah, it’s pretty nice to be the bull that catches all the water dripping out of the leaky bucket of Substack and Review because they're just increasing the top of the funnel and you're there to catch it and actually help people build bigger, better businesses.
The other fascinating thing is 10,000 subscribers or say even 100,000 subscribers is really big is Substack, like one of the biggest, if you get that to 100,000 subscribers.
What's fascinating is that's actually a relatively, that's a mid-sized newsletter. The biggest newsletters on ConvertKit are well over a million subscribers. The Tim Ferris’s, Gretchen Rubin's, James Clear’s of the world. They're all huge. We just don't do as probably as good of job marketing because we sit behind the scenes.
I think of it as Substack is to Amazon as ConvertKit is to Shopify of Substack is taking a much bigger cut. They're front and center and the brand. You know that you're buying from Substack. Whereas, if I'm buying from a creator on Shopify from their e-commerce store, I as an person who pays attention to user experience, I can tell this is Shopify. Almost everyone doesn't know. That's the approach that we're taking of the creator should be front and center. You should have the highest cut of revenue. ConvertKit payments are 3.5%, whereas on Substack they’re 12.9%.
To say that differently, in almost in a way Substack is telling a story where they are the hero. In a way it's super flashy because everyone says Substack, Substack, Substack, but you go to any sort of particular Substack landing page or a newsletter, and they all kind of look the same.
It's very hard to differentiate. You know, it's not really creator focused and ConvertKit’s the opposite. You're the guide. You're in the background. You're Yoda, you know, you die in the second or third movie or something. But Luke goes on and ends up having great legends talking about him.
That seems to be the good place to be. I'm going to guess that you're generating a hell of a lot more revenue then Substack is, and you will probably for time immemorial.
The last question I'd like to ask on these shows is basically, if you search through your story like what you've learned, what do you think indie hackers out there need to hear? What's something that they can take away from your learnings and your experiences? It doesn't need to be the most important thing.
Yeah. I think the biggest thing is that it takes a long time. When you look at compound growth of any kind, you have to give it enough years for it to compound.
In the early days of what I was doing, I was trying something and then jumping to the next and that kind of worked. I’d learn a lesson to roll it into the next thing, and that was great. But if you look at the most successful companies, usually someone has been grinding away at it forever.
In our space, I think about MailChimp. They started working on MailChimp in 2001. They're $800 million a year in revenue or something like that. They haven't said numbers publicly recently, eight or 900 million is where I would trend them to be.
The kind of the funny thing is ConvertKit is eight years old. If you were to overlay MailChimp's revenue graph, starting at year zero founding with ConvertKit’s at year zero founding, ConvertKit’s is significant and larger revenue wise than MailChimp was eight years then.
The thing that most founders end up doing is that they ended up selling early, moving onto the next project, giving up too soon or anything else where they're like, oh, look at this compound growth that they're getting. It's like having a thousand dollars in your sock account. Yeah, it's compounding, but it's not compounding yet. Give it another decade. Then it'll really compound.
I think about a competitor that we had in the early days called Drip, we were founded at exactly the same time. For a lot of reasons, he made the decision to sell Drip. I think that was absolutely the right decision for him and his family and everything else.
But ConvertKit’s going to be a wildly larger company because we didn't sell relatively early. We stuck with it for a long, long time and it's, and now we're getting the compound growth on that. So, I guess the thing that I would say to indie hackers is, it takes way longer than you think, and it's worth it if you keep going.
I love it. It reminds me of the beginning of the pandemic, where everyone was talking about exponential growth and people were afraid cause like, look at the numbers, they’re so small, they aren’t much higher than they were last week.
I was like, yeah. When you're getting compounding growth in a small number, it's pretty small at first, but it ramps up very quickly. If the same thing applies across the board, indie hackers I think should heed your advice in there that like, yeah, things might not be crazy in the early days, but if you stick with it over a long enough period of time, you can get to a pretty life-changing outcomes.
Can you let people know where they can go to learn about the million and one side projects you're working on and also what's going on with ConvertKit?
Yeah, let's see. Well, you should go subscribe to the podcast. Just searched Nathan Barry Show in iTunes, Spotify, et cetera. You can subscribe to my newsletter at nathanbarry.com. That's where I write about everything and link off to the random things that I'm doing. I'm most active on Twitter just @NathanBarry. DMS are open. Email is open. Just get in touch any way you want.
All right. Thanks, Nathan.
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