I’m in the midst of the biggest gamble of my career. The thing is, every chance you take feels like your biggest gamble while you’re taking it.
When I left salaried employment for consulting in 2006 it felt like a big gamble.
When I left consulting for product in 2008 with a wife, kid and a mortgage, it felt like a huge gamble.
When I spent most of the money I had in the bank on a broken-down SaaS app few people had heard of, called HitTail, I was downright scared. It’s hard to put years of work and savings on the line, based on nothing more than confidence that you will execute.
But every one of the above gambles worked out, and I wound up far better off than if I’d never taken them.
And here’s the thing…
The more gambles you take, the better you become at reading the tea leaves and figuring out if your next gamble is going to work.
You also gain confidence in your ability to execute when your back is to the wall. This means you don’t crumble under the stress of the decision.
Instead, you start to become addicted to drawing yourself out of your comfort zone. This is a good thing.
You start to embrace the immense amounts of learning that happen when you’re doing something that terrifies you.
Pushing on Drip
When we launched Drip last November the first month was solid – over $7k in recurring revenue. I was pleased with that result and was looking forward to growth in the months that followed.
Except growth didn’t come. Second month revenue (granted, it was December) was $7k.
Third month revenue was the same. And worse yet, I started to see a trend…
Many of the new subscribers I was adding through my tried-and-true marketing efforts were churning out after a few months of use. It’s an expression I used to call “leaking out of the bottom of the funnel.”
Now we just call it churn.
A high churn rate means you haven’t found a market that really needs your product, or, worse yet, that you’ve built something no market wants (yet).
And if you’re paying attention this is the learning phase that happens between building and scaling (I talked about it in my 2013 MicroConf talk). The learning phase is, in my opinion, the most painful part.
So while the percentage of new users who completed onboarding was high for an app of this complexity (close to 60%), they were not sticking around like I would hope, which meant we hadn’t hit the nail on the head and solved the problem I came to solve.
Namely: fixing email marketing for startups.
So it was back to work.
We had more than a dozen requests for “marketing automation” features – basically, features that allow you to send subscribers personalized emails based on their behavior.
So if they read a lot of SEO articles on your website, you can tag them with “SEO” and move them into your SEO crash course.
And that’s the tip of the iceberg; you can tag people based on links they click, URLs they visit, or things they buy.
Tracking customers from website visitor to marketing subscriber to trial user to customer, and being able to tailor communications the entire time is insanely powerful. In fact, it’s the future of email marketing. But I didn’t want to build a behavioral email/marketing automation platform.
It would be a ton of work to build, and the space has been crowded for years. It’s not a typical bootstrapper play, it’s the kind for which you raise funding.
But the more founders I spoke with, the more I realized this was the real problem they were facing. Most founders have either outgrown their first email marketing app (think of a static email newsletter service like MailChimp or AWeber), or they’ve tried a beefy tool like Infusionsoft and it hasn’t worked out due to high price and low usability.
Contrary to my plans, founders didn’t need a little help with email marketing, they were telling me they needed a massive step up from the tools on the market.
Perhaps fixing email marketing for startups was a much bigger problem than I had originally thought. And perhaps this new approach was the one that I came here to solve.
Best Laid Plans
We planned for 1 month of development to build email marketing automation focused on the Saas, WP plugin and info product use cases. It took almost 5.
We rolled it out in batches – a new feature every few weeks. And the strangest thing happened as we did…
Revenue started moving up. First a few hundred. Then a thousand.
Churn plummeted. By more than 50%. Revenue rose almost 50% in a couple months.
All during a time when I was heads down, not doing a lick of marketing.
I had a feeling we were on to something.
I’ve invested a year’s worth of company profits into Drip. Funds that could buy a house in most cities in the world. And I’ve invested the bulk of my waking hours for a year.
We’re entering a competitive market with massive upside and players who have raised millions of dollars.
And here I sit, on the eve of unleashing Drip 2.0 realizing that this is, once again, the biggest gamble of my career.
The thing is, every chance you take feels like your biggest gamble while you’re taking it. And most of the time choosing the gamble is the right choice.
Wish me luck.