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- [00:00]
A
Michael built a productivity app called Nozbe and now the business is stuck at $1 million per year. So he's flown here from Europe to brainstorm how he can break through that ceiling. The goal is to scale Nozbe to 5 million. Expansion is a very important metric for kids business.
- [00:16]
B
One big roadblock that I have encountered throughout the years is that I could fire myself from all of the roles in the company except for the marketing role.
- [00:25]
A
We've got plenty of things to cover here. We break out brand, team, customers and product. We put everything on the board so we can it and identify what's working and what's not. One way to get attention is direct sales. I love this method because it is entirely within my control. The problem here with direct sales in this business is this, right?
- [00:43]
B
Yeah, exactly.
- [00:45]
A
So if your company's revenue has plateaued, you're really going to benefit from going through this diagnostic process and seeing how to run the same audit on your own business. Have you heard this idea of Max mrr?
- [00:57]
B
No.
- [00:57]
A
I cannot stress how important it is. So what you need is.
- [01:01]
B
You need. We got it. So cool.
- [01:03]
A
That was fun. So, Michael, tell me about Nozbe.
- [01:07]
B
Yeah, so it all started because I am not a very well organized person. My wife is. I'm not. And I knew that I had, you know, in order to be successful, I had to figure it out to be organized. And especially I was a good consultant. But I was starting to, you know, not make deadlines, like really, you know, not deliver on time. So I read this book by David Allen, Getting things Done. And I was. And the book is great, the advice is great, but it was very it, like, you know, old school, right on the piece of paper, like all that stuff. And I was like, there must be a digital way for this. So. So this is how it started. I started, you know, writing my own tool. Actually over the weekend, I built a verse version of Nozbe just for myself.
- [01:50]
A
You're a programmer by trade?
- [01:51]
B
Yeah. No, yeah, kind of. I'm a geek. Okay. So I studied business, but I was in the free time, I was programming.
- [01:58]
A
Yeah.
- [01:59]
B
And that's why. So I. It was fun for me always. It's like LEGO bricks, you know, it's like building something. I'm a builder. So in that sense, I built very quickly a prototype of this and then I started using it daily. And I was like, yeah, this is good. For example, I stole this idea from Gmail that when there is like, when you have many projects, when you have many tasks with a star you can make the ones that are, you know, that are important.
- [02:21]
A
Yeah.
- [02:22]
B
So this is. This was my. My way of doing priorities and next actions from getting things done to. To my app. And when I started Nozbe, when I launched it to the world, like, there were crickets in the beginning, but then I was involved in some, you know, GTD discussion groups, and then there was actually a question like, which tool do you use for getting things done? I was like, yeah. So I built this thing and can you give it a try? And one of the people who read this thread was a famous, then famous blogger from ZDNet, and he just wrote a whole article about Nozbe on ZDNet and it just blew up.
- [02:56]
A
Oh, wow.
- [02:57]
B
So it was like. And I was this guy from Warsaw, Poland, in an apartment, you know, doing that. So completely unknown in the States, but I built the version of. Must be the first version in English. So this is how it started, basically.
- [03:11]
A
Okay, and so how long did it take from launching the first version to reaching a million in annual recurring revenue?
- [03:16]
B
Okay, so it was a few years. So in the first year. In the first year, I managed to get to $4,000 in monthly recurring revenue.
- [03:28]
A
Okay.
- [03:29]
B
So it was still my side hustle the first year. But then when I reached 4,000, I was like, I'm not making 4,000 on my, you know, consulting job. So actually I'm making more on Nozbe. And I preferred to work on Nozbe. So. So after New year's eve of 2007. 2008, when. When I crossed the. The 4,000 monthly recurring revenue, I decided I'm going to just drop the customers and just focus on Nozbe full time. And then three, four months later, I hired my first programmer, because then I realized I was good enough programmer to start it, but I'm a crappy programmer to continue developing it.
- [04:05]
A
Yep, that makes sense. Okay, and so what year was that?
- [04:08]
B
2008.
- [04:08]
A
2008.
- [04:09]
B
When I, you know, moved full time.
- [04:11]
A
Okay, that makes sense. And then what was the journey from full time to a million ARR.
- [04:16]
B
Yeah. So it was like. So the first three years we. We got. I remember. I remember this ceiling. We couldn't. I couldn't break $20,000 of monthly recurring revenue. I was like. It was like 1817. I was like, come on, man. So it was. It was that. And then we launched an iPhone app with. In collaboration with a different company. And by accident, our. Our application in 2010, 2011, blew up in Japan.
- [04:48]
A
Okay.
- [04:49]
B
Because we had the iPad app and the. Because iPad launched in 2010, and just right after launch, we had an iPad app for Nozbe. So we were one of the few, you know, to do apps having an iPad app, and somebody wrote an article in Japan, and then suddenly it blew up in Japan. And when it blew up in Japan, it went from 20,000 monthly recurring revenue to 60,000 monthly recurring revenue.
- [05:12]
A
Wow.
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B
It was just.
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A
And was that global growth or was that really concentrated just in Japan?
- [05:17]
B
I mean, it was global growth, but. But, like, half of that was in Japan.
- [05:20]
A
Okay. Wow.
- [05:22]
B
So. And actually, I went to Japan to promote Nazbee. It was the first time ever I flew to Japan. First time I hired a PR consultant person because I didn't and I didn't speak any Japanese. So we had the whole promotion there in Japan and everything.
- [05:35]
A
So that worked to drive more growth?
- [05:36]
B
Yes. Okay. Yeah. I mean, at least sustained the growth that. That. That show up there. So. And then this guy who wrote the initial, you know, article about no back then, he actually wrote a whole, you know, kind of manual book for Nozbe in Japanese. So. So there was a book about Nozbe in Japanese. And. And this is. This is basically where that catapulted US to, like, 50, 60,000 monthly recurring revenue. And then after that, also in the States, there were more customers. And so we basically, like, two years later, like, we already had 1, 100,000, you know, monthly recurring revenue.
- [06:16]
A
And when did you hit that peak?
- [06:17]
B
So the peak that we hit was the, you know, the 1.5, 1.6 million ERA. And it was like, around 2016, 2018. So that was the. That were the years where we reached the peak. But also there was the moment where I observed that the customers who loved our app, he kept buying, and they kept buying the, you know, the annual subscriptions. We also also always had that pricing that the annual subscription was 20% cheaper than the monthly and was enough for people to prefer to buy annual. And of course, for us, it was better because there was a commitment to use our tool. So we would also every now and then do like, a promo of, like, you know, if you buy for a year, we give you three additional months or something like that. So this was also weird because then sometimes they would renew, like, you know, 15 months later. So we had, like, renewals at very different stages, but this worked for us. But I realized two things. First, that there are also, like, increasingly many more, like 2016, 2018, many more tools that are just free to do apps that basically do what we do. But the collaboration features of getting Things done together is much more powerful. This, this was my, our discovery as a team that we actually have more fun, like by collaborating on tasks. We call it task based communication. So we basically, you know, each task has a common thread. So this way we comment on the task, so it's much more productive, much more clean. You don't chat, you know, in Slack or somewhere else. The communication is about the task, you know, that has to be done and the clear delegation and all that stuff. And then we realized we have to, you know, develop more of these tools of, to make sure that the collaboration works better and. Yeah, and then basically we had this wild idea which, you know, which was a mistake to rebuild our tool from scratch, you know, putting, putting the comments and the collaboration like, as the core feature of our app. So getting things done together.
- [08:31]
A
Okay, and so then you rebuilt that in 2020.
- [08:35]
B
Yes, and then we launched in 2020. And much to our disappointment, it didn't, you know, it didn't hit off quickly. While we did neglect our, you know, Nobe Classic customers who were using the classic app because we were not developing it, you know, at similar pace. So even though it's not like people demanded lots of features, it was just like kind of neglect, you know, not.
- [08:58]
A
So what, is everyone on the new version of Nozbe now or.
- [09:01]
B
No, no, no, no. We still have.
- [09:03]
A
What's the split now between Classic and.
- [09:05]
B
So, so now it's now the, the number of customers, it's more or less. It's 60, 40%. So 60 is on the old one and 40 is on the new one.
- [09:16]
A
Okay.
- [09:17]
B
And. But the, the, the revenue and the, the growth is on the new one.
- [09:21]
A
Okay, that makes sense. All right. There's so much that I want to dive into in this business before we jump up on the board. What, what would success look like for this business? You're at a million ARR. You've been stuck there for a while.
- [09:33]
B
Yes.
- [09:34]
A
Like what, what is your goal to get to.
- [09:36]
B
So I am mission driven, just like you guys. So I'm this ridiculous guy that when somebody, when I see somebody who's disorganized, I'm going to tell them, just use nosme, like use my app. You know, I feel like this car salesman, you know, like, I want to give them my app. So for me, the 1 million annual revenue rate also symbolizes that we are not reaching the people we were supposed to reach because, yeah, money is great and all, but I would like to have just a bigger impact because I, I know for a fact that because the thing is, as you will see from the metrics, like, when once people get the hang of our app, they love it. But how do we show it to them? How do we onboard them? How do we convince that their team should go all in on our app? That's the. That's the main issue, I would say so for me, yeah, I would love to have, you know, like, in the next few years get to 5 million.
- [10:33]
A
Okay.
- [10:33]
B
And then hopefully 10 million at some point. But 5 million would be great.
- [10:37]
A
And then I think one other piece of context that's really important is just what's happened in the competitive landscape. You touched on it. You have a lot of products now that are mainstream. What is Asana Trello Monday. ClickUp.
- [10:51]
B
ClickUp. Like, all of these guys. And the thing is, this also caused kind of an identity crisis for us. Like, we were like, should we continue doing it? Like, they're great tools, these guys. Like, they're fantastic tools. Like, why do we bother, you know, to develop our tool?
- [11:09]
A
It's a good question. Why?
- [11:10]
B
Yeah, exactly. And we were. Because we were just thinking, maybe we are the only customer of our. Of ours. Like, we. Maybe we are the ones that we are building it only for ourselves and we are selfish and, you know, we should just, you know, go home. But then our customers came back very often, like, because I thought, you know, if people know about Asana, they're not gonna. They're not gonna even give us a try. But then our customers came, came and they were like, yeah, no, we. We did try ClickUp. We did try Asana. They're just bloated. We don't want bloat. We want like, because in our in Nozbe, tasks is the main thing. Like, they're. You organize projects in tasks into projects, you tag tasks and tasks have comments and tasks is the main thing in as task is one of the features, right? It's like, it's one of the things. And that's why our customers told us, like, no, no, no, keep going. What you're doing is great. Like, and they voted with dollars. Like the. Still, I would argue that 1 million annual revenue, right? It's still not bad. And it shows that people actually are willing to pay money for your software. Just that we needed. We needed this reinforcement. We needed that. We needed to know that, okay, so we're not building this just for fun for ourselves. Like, there are there who have tried different things and came back to us. Like the. The ground was. The grass was greener on the other side, but it's not so. So this kind of helped us when we were in this, like, low point. At some point, like three few years ago, it helped us, you know, reinvigorate. And now we have a roadmap with some additional cool features. We're going to incorporate some AI into nozbe and stuff. So we have ideas how to make our simple tool, like, even more powerful, but still simple in that sense.
- [12:57]
A
Sounds good. Well, you're really passionate about the product, and I would love to help you bring it to more people. So let's jump up on the board and just really diagnose and dig in.
- [13:05]
B
Let's do it.
- [13:05]
A
All right, so the goal. We'll just start with that. The goal is to scale to five. I like it. Okay, so let's look at where we're at now and kind of break down a few of these things. There's two groups that I want to focus on. There's really the metrics of the business and then sort of the core building blocks. So from a metrics perspective, we just write some of these down.
- [13:35]
B
Let's see.
- [13:36]
A
I guess the revenue growth is going to come from two things, really. Awareness.
- [13:40]
B
Yes.
- [13:41]
A
And then activation.
- [13:42]
B
Yeah.
- [13:44]
A
Then if we were to keep breaking this down from activation, there's really expansion. Yeah, Expansion. Retention or churn. Same thing. Retention. And then referral would be the last one.
- [14:04]
B
Yes. Yes. This was also our bread and butter in the very beginning because the GTD enthusiasts were referring NOZBE and others to Nozbe very easily.
- [14:13]
A
Okay.
- [14:14]
B
Now, referrals are not that.
- [14:15]
A
So that's. That's good to look into. There's other ways you could phrase this of, like, obviously we don't have contraction and reactivation and some things in here, but as some core buckets, that's good. And then within the team or within the building blocks of the business.
- [14:31]
B
Yeah.
- [14:31]
A
If we were to write these down, I'll switch to another. Another marker we have, I think there's brand, the team itself, there's the product, and then customers. Almost bets.
- [14:52]
B
Yeah.
- [14:53]
A
Okay, so I want to start in. Let's start down here. So this is the building blocks of the business. So when we look at brand, there's some of these businesses that I come across that you just look at them and you're like, this isn't going anywhere. It's almost like you can sense that the founder either doesn't have drive, skill, or taste in some version of that. And so they're like, this looks amazing. Or like, I'm so proud to bring this to market. And everyone else is like, either this is wrong in some way or I don't know what's wrong, but it's not gonna scale. I look at the brand that you have. So like the name.
- [15:30]
B
Yeah.
- [15:30]
A
That's one that I think is important. If we look at these components, I think the name Nozbe can work just fine.
- [15:38]
B
My wife, she's an IP lawyer and she says it's great trademark because it doesn't mean anything. Like, because it's. Because it's. The whole history of Nozbe was like to. To be actually organized BNOs or NOSBY. And then. And I just bought it because it was a cool name like with a Z in the middle and was dot com. So.
- [15:55]
A
So I appreciate that the trademark law aspect is important. I don't really care about it.
- [16:02]
B
Neither do I, but my wife does.
- [16:04]
A
So yes.
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B
I have to buy books.
- [16:06]
A
Well, I mean it's a box you have to check.
- [16:08]
B
Yes.
- [16:08]
A
Right. It's when we rebranded from ConvertKit, which is very trademarkable.
- [16:12]
B
Yes.
- [16:12]
A
Lockdown to Kit.
- [16:14]
B
Right.
- [16:15]
A
It's a much more difficult thing. We actually had to go and acquire a company to get a trademark for Kit because we wouldn't be able to get it from scratch.
- [16:23]
B
Right.
- [16:24]
A
So it's really important. What I care more about is the feeling of the name.
- [16:27]
B
Okay.
- [16:27]
A
You get some of these names that, that sound like default negative or like what emotion does it evoke. And so I think that Nozbe as a name is short spellable enough. You have the dot com and it doesn't evoke any negative emotions. And so like I'm like, name is good, that's not an issue. Then if we go down, I, I think that design is the next thing. I don't think that the design is that you all have is going to be the standout differentiator. If you take a product like Linear, they're all in on design. It is the most incredible thing. And people, whether it's a little UI interaction or their marketing site. So that's what happens when you go like, yeah, design as your differentiator. I don't think it is for you, you all. But I don't see it as a detractor as well.
- [17:17]
B
No.
- [17:18]
A
And so I think that from a brand perspective on name, on design, like you're good on the team side. Tell me about the team a little bit.
- [17:26]
B
Yes. So. So we had to contract a little bit the team because we were, at some point we were like 25 people. Now we're 15.
- [17:34]
A
Okay.
- [17:35]
B
So. So we have a Small team. Now, one big roadblock that I have encountered throughout the years is that I could fire myself from all of the roles in the company except for the marketing role.
- [17:50]
A
So give me a breakdown of what. What teams you have and how many people are in each one.
- [17:58]
B
Okay, so. So in customer support, we have four people. Let's start with that. And then we have five. Six developers. Sorry, six developers.
- [18:14]
A
Okay.
- [18:15]
B
We have a designer and a QA guy. So these two guys. Yeah. And then we 1012. Yeah. And then we have three marketing people.
- [18:25]
A
Okay, all right, that's good context. Now, as we will dive more into this in a second, but as we go to product. Yeah, I want to pause here, actually, and let's go to these metrics.
- [18:35]
B
Right.
- [18:36]
A
Because there's things I noticed about your product that make me think it's not the issue that we're facing, but I
- [18:41]
B
want to dive into the.
- [18:42]
A
Into the metrics. Have you heard this idea of max mri?
- [18:48]
B
No.
- [18:49]
A
So it's this. If you think about any business that flatlines, everyone thinks in terms of growth curves. Right. Like this is linear growth. This is exponential.
- [19:00]
B
Yeah.
- [19:00]
A
The most common growth curve that you'll ever see is the S curve is this curve. Yeah. And so you think about, okay, what drives the S curve? And typically it's that awareness is a fixed dollar amount.
- [19:14]
B
Yeah.
- [19:14]
A
You know, or your awareness activation combines to a new monthly revenue of a certain amount. And so let's say we're bringing in a thousand dollars of new MRR every month. And that retention or churn is always a percentage.
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B
Yes.
- [19:31]
A
And so at some point.
- [19:33]
B
Ah, yeah.
- [19:34]
A
Your. Your percentage of the total.
- [19:37]
B
Yeah.
- [19:38]
A
Becomes greater than whatever you're bringing in. And your S curve. Flat.
- [19:41]
B
Yes.
- [19:42]
A
And so this happens to a bunch of different, you know, happens pretty much every business. And so you either have to keep driving the combined, you know, the combined new. Higher and higher.
- [19:57]
B
Yes.
- [19:57]
A
To deal with your retention percentage. And it's a very hard thing to do. If you can't overcome that, then it flatlines. So what has awareness? Like we are top of funnel. How do you measure that? Is that new users, New revenue?
- [20:15]
B
Yeah, new users. You're very much right that the awareness is kind of a fixed thing, because there were times when we had many new users, for example, from the US because, for example, Michael Hat was a big user and he was recommending nozbe. So when he was recommending people around him, people in his sphere were also trying out nozbe. And so this helped. But the moment he stopped recommending, he was doing on other things, this dried out. And for me, for example, we lost both this kind of awareness in Japan that we had and in the US at some point. Now we're slowly getting back. But for example, but we did get new awareness in Poland, like in our local market. So we do have like. Because our app is translated in several languages, but we have the Polish version. And then me, being a Polish entrepreneur, managed to get us some, you know, some press. So that helped us grow a little bit in Poland. But right now the problem with awareness is because again, I don't want to blame it on others, but because of the big competitors that have so much money on marketing, they bid on our keywords, they bid on everywhere. So it's hard for us to break through.
- [21:36]
A
Right, so that's a good point. Based on the price of your product. So if we. Based on the product, you're roughly $8 per user.
- [21:46]
B
Yeah, 8. $8 per month.
- [21:47]
A
Okay. And that's per user. And so you obviously have a big range within that. But if I understand correctly, you haven't been able to scale, like make ads profitable.
- [21:57]
B
Yeah.
- [21:57]
A
And when I search for Nozbe as a brand, I think I saw five competitors that are all bidding on your brand keyword.
- [22:03]
B
Exactly.
- [22:04]
A
And all of that. So awareness has been decreasing over time.
- [22:08]
B
Yes.
- [22:10]
A
And then what about activation? So when users, when you get that account created, what is trial to paid or onboarded? How has that been trending over time?
- [22:20]
B
Something. What we did was helpful is because we were not doing it for a long time. But we started like two years ago, we started to having. Offering demo meetings. So like to schedule a demo of our software, even though it's cheap, we still thought, you know, let's do demos. And Magda, who runs demos, she's. She is amazing. But if you ask her, her conversion rate is only 50%. So she's really struggling with the fact that 50% of people who show up for a demo with her are not signing up.
- [22:57]
A
Do you have that funnel instrumented where you can see? I guess if we were to map out the funnel, you can see visit to demo account and to demo demo. And then, you know, you'd have paid and then retained.
- [23:20]
B
Yeah, retained.
- [23:22]
A
Do you have like, do you have a dashboard that shows you these stats?
- [23:26]
B
Not like this, no.
- [23:27]
A
Okay. Any reason for it?
- [23:29]
B
No, we just like we started with the demos, it started working, so we didn't like we should. So now we are trying to incorporate it more into like, kind of kind of our flywheel. Let's say that that you know, so we're also promoting much more on social media. The idea that you would get a demo with, with Magda and also among, you know, sending follow up emails to our customers that they haven't scheduled demo. So like trying to. Because we see that once the demo is done right. They, they. Because, because what, what, what Magda does on the demo, she not only just shows off our software, she actually asks questions about their business and she shows them.
- [24:09]
A
And does she live, does she work on marketing? Okay, why don't you write down. So I want to keep going through all this, but I want to flag a few conversations for us to dig deeper in. So why don't you write down on this board, on the sheet, why don't you write down metrics?
- [24:24]
B
Perfect.
- [24:25]
A
Okay, so we'll come back to metrics. Yeah, but the over. How do you measure overall awareness? Is that visits to the website?
- [24:33]
B
Yeah, visits the website.
- [24:34]
A
And what does that trend look like over time? It's flat. Flat, okay.
- [24:39]
B
Yeah.
- [24:40]
A
How does it compare to 2018 when you were 2016 at your peak?
- [24:47]
B
It's, it's much slower than it used to be.
- [24:49]
A
Okay, so why don't you write down. Let's just put traffic on your metrics. And that's another thing that we'll come back to. Perfect. All right, so as we keep working our way through this, let's go to expansion. Expansion is a very important metric for guest business. We would be fighting a huge uphill battle if it wasn't for expansion.
- [25:12]
B
Yeah.
- [25:13]
A
So our expansion metric is, you know, as your audience grows, if you started with 5,000 subscribers, you pay us. What is that? Not quite 100 bucks a month, 80 bucks a month, you know, and then later on you go, you know, that goes to 100 and on from there. Your expansion metric is number of seats. Right. How much of your net new MRR each month is driven by expansion?
- [25:41]
B
I don't have it from top of my head, but it's important we see that again. Once they stick with the product, once they start using the product, they invite new users.
- [25:53]
A
So maybe let's look at it a different way. What percentage of your paying customers have more than one seat?
- [25:59]
B
Yeah, so 40% of our customers have one seat. Okay. And then another 40%, two to three people. And our NOSBE is freemium, so it's like up to three people and three projects. It's for free. But of course, if you want to have many projects, you have to pay the unlimited planner.
- [26:22]
A
Okay. And 20 is greater than that.
- [26:25]
B
Yes.
- [26:26]
A
Okay. And that's based on rev.
- [26:29]
B
On the.
- [26:30]
A
This is based on number of customers
- [26:32]
B
now, number of paying customers, the count
- [26:34]
A
of customers, not the revenue.
- [26:35]
B
Exactly.
- [26:36]
A
Yes, because revenue would happen.
- [26:37]
B
It's the other way around. Like the 20% above that they make,
- [26:41]
A
you know, and then 60%, you know, so, as if we come back to activation. You mentioned it being freemium.
- [26:46]
B
Yeah.
- [26:47]
A
Do you. What are the free users doing? Are they coming in and high volumes? Are they. Are there just a few of them? Are they upgrading to paid?
- [26:55]
B
Yeah, so usually they upgrade to paid whenever we launch, like a special offer promo for a year, for example. Like, like, like the Black Friday offer. Like when you pay for a year, you get extra months. So. So then they usually upgrade. If they don't, they just, you know, because we have three projects, so they basically are using our free plan as much as they can. Three projects. And for us it's okay because the thing is, using our app is also a new habit. So I do appreciate that they need more time to get used to Nozbe so that they can really upgrade to premium. And very often the upgrades happens like a year later or two years later, even. So it's like a late upgrade.
- [27:49]
A
Okay, so if we were to make a very unscientific graph of free value that you're offering, you're offering so little value on the free plan that why would someone ever use the product all the way to so much value on the free plan? Why would someone ever upgrade? There's no reason to. To upgrade. Where are you in this spectrum based on your own perspective?
- [28:16]
B
Somewhere in the middle, I think.
- [28:17]
A
Okay. Yeah, like, so, like, people are getting good value out of the free plan, but they're definitely hitting limits and upgrading properly.
- [28:23]
B
Yeah, I would say, I would say something. We're, we're.
- [28:26]
A
We're heading out somewhere because we were
- [28:28]
B
giving five projects at some point and it was just, we, we. And we did measure that, that it was just, you know, giving too much. And so, so we reduced it to three projects and then we. So the difference also with the new Nozbe was also the switch that you can have up to three users because I wanted to get, for example, partners on board. So, for example, business partners, they would sign up and then we have data to prove it that once they sign up and start using LB together, they do get it for their team. Then
- [29:05]
A
that's another important point under the product. So you have what percentage of customers on the old version of Nozbe still 60%. Okay. So the old is 60% new. It's 40%.
- [29:16]
B
Yeah.
- [29:18]
A
And this has been out since 2020.
- [29:20]
B
Yes.
- [29:21]
A
Okay, so there's two things that I noticed in this one. Is there any way to sign up for the old osme. No. Anymore.
- [29:29]
B
Not anymore.
- [29:30]
A
Okay. So you have. Oh, this is interesting because we had
- [29:34]
B
it for quite a while and then we realized that it's just confusing customers. So now when you want to sign up for the classic nozbe, we ask you to sign up for the new one.
- [29:43]
A
So are people still trying to sign up for the classic one?
- [29:47]
B
Sometimes. Okay, sometimes. But the thing is that the price is the same. So we did like two years ago, we did like pricing harmonization thing so that the prices are the same for both products. And then we also made it very easy to migrate. So also that if somebody is on the old one, they can migrate very easily to the new one.
- [30:10]
A
Yeah. Okay. So the things I'm noticing here are, first, there's very little incentive for legacy customers to migrate.
- [30:18]
B
Yeah.
- [30:18]
A
And then the second thing is there's not actually that many new customers coming in.
- [30:22]
B
Mm.
- [30:22]
A
Because over five years.
- [30:23]
B
Yeah. I think that there's only.
- [30:25]
A
You would replace a meaningful percentage.
- [30:27]
B
Exactly. I was hoping for that.
- [30:29]
A
Yeah. So that brings me back to this awareness problem.
- [30:32]
B
Yeah.
- [30:33]
A
Right. Of. We just don't. People don't know about this.
- [30:38]
B
Yes, yes.
- [30:38]
A
Right.
- [30:39]
B
That's true.
- [30:40]
A
Okay, so let's keep moving down under products. You know, retention is another factor. What's the monthly user revenue churn?
- [30:49]
B
Yeah, it's. It's around. Around 3%, 3 1/2 percent.
- [30:52]
A
Okay. And what's that done over time? Like, is it decreasing? Is. Is it flat?
- [30:59]
B
It used to be like 5, 6% percent like two years ago, but we managed to, to, to. To move it down to 3% over the last year. So it's now it's stable at this.
- [31:11]
A
So something that also happens in business is early on when you're building a product. Yeah, people.
- [31:17]
B
Yes, I'm.
- [31:18]
A
Well, they hear a revenue number or a churn number, like 6%, 9%, that sort of thing. And they point to this max MRI idea and they're like, look, you're going to plateau. This business will never grow past. Like you're going to fail. You might as well quit and give up now. People told me that with kit of like, sure, you know, sure, you hit 10K MRR. But based on that 10% monthly churn, you'll never go grow past 20. Camera. And on one hand, they were right because the math formula does work out that way. It is true. The thing that it doesn't account for is that every month you have like the customers that do stick around tend to stick around for a very long time, which is what you're seeing here.
- [32:00]
B
Yes.
- [32:01]
A
And so the churn just naturally falls. I mean Kit did the same thing until, and we worked on it a lot. But like to an extent even just the physics of the customer base resulted in a at least a sub 4% monthly churn. And so that, that's solid. That tells me that the product is solid.
- [32:21]
B
Like that's what I have a cool story here about the old customers. So two years ago we did the price harmonization to make sure that the prices are the same because the prices were different. So it was also like no incentive to go to the new one and all that stuff. So we made the prices exactly the same. But before we did that, we emailed our customers saying hey guys, we're going to increase the prices. So because you are great customers, you've been great customers for years. If you extend your account today with the old price, you're going to secure the old price until you finish. So I have customers that have accounts until 2040 that prepaid for that line
- [33:06]
A
as we record this in 2025.
- [33:08]
B
Exactly, exactly. So I can say that I've been running Nozbe for 20 years and I have customers for like 35.
- [33:15]
A
So let's dive in. That brings us to the customer aspect. You have die hard fans.
- [33:22]
B
Yes. We have true fans. Yes.
- [33:28]
A
Do you have, are there any identifying characteristics of your best customers?
- [33:34]
B
I don't know. I think it's the productivity buffs. Productivity people. People who like getting things done, who like the methodology, who like productivity just like I do.
- [33:49]
A
Okay, so you wrote Initial wave a lot on gtd.
- [33:55]
B
Yes.
- [33:56]
A
What is happening if we were to do a Google Trends search right now for gtd? No, I mean what, like what is that market doing now?
- [34:03]
B
The market is more or less gone now. I mean it's, you know, it's past its peak. You know, it's I love David Allen and we are good friends, but it's like, you know, it's no longer a trend and it's not. And the thing is because the book is pretty like old fashioned, so people are no longer resonating.
- [34:25]
A
It's not selling number of copies.
- [34:26]
B
Exactly.
- [34:27]
A
Okay, there's something here. So why don't you write true fans on the sheet and we'll dive into it more.
- [34:31]
B
Okay.
- [34:33]
A
And that brings us to our last metric, which is referrals.
- [34:36]
B
Yes.
- [34:37]
A
So do you, do you Track referrals in any way. And what are you noticing?
- [34:41]
B
Yeah, so thing is, the thing is, back in the day when we were like big with the GTD fans, the referrals were just completely organic and people were just recommending NOSBU left and right without any taking any credit of it. And now we've built a referral program and it's really built in. I would like to say it's very nicely built in that you can very easily generate a URL and also you can add your own testimonial. So if you refer to Nozbe somebody then they open nozbe.com there is your testimonial because you came from there and still like, I don't see like when we track the clicks and then the recommendations, they're not so many.
- [35:24]
A
Like, okay, so there's not many in total number. Yeah, but where going back to the funnel view. Yeah, yeah, yeah. Where's the breakdown in it? People aren't generating those links, Those links aren't getting shared. The shared links aren't getting visits, or those visits aren't converting to customers.
- [35:41]
B
I'll have to check that.
- [35:42]
A
Okay. My guess is it's pretty high in the funnel. Right. They're not being generated and those that are generated aren't really getting exactly. Traffic. So again, like awareness and traffic is a key issue.
- [35:56]
B
Yeah.
- [35:57]
A
So referrals could, like referrals were a big opportunity in the past, so they could be going forward.
- [36:04]
B
Yeah.
- [36:05]
A
Okay, so if we, if we break this down, as far as we know, we don't have an activation issue.
- [36:10]
B
Yeah.
- [36:10]
A
We just don't have enough top funnel.
- [36:12]
B
Yeah.
- [36:13]
A
We don't have an expansion issue because that seems fine. Yeah, maybe that's a lever that we could pull, but.
- [36:20]
B
Yes, but it's not that it's an optimization. Yeah, exactly.
- [36:24]
A
We need more customers coming in.
- [36:25]
B
Yeah.
- [36:26]
A
Retention is fine. Referrals are an opportunity.
- [36:29]
B
So one more question about awareness and everything. So my problem was it's always been kind of how to really sell what I'm doing because it's like, is it a to do app? Is it a project management app? Is it like how do we compare ourselves to others or how do we kind of position ourselves? So one of the ideas we had was that just kind of like you say, we help creators succeed and make money on the Internet, Something like that. So we said that we help small business owners get their private and business life organized in a simple way. And I don't know if this is the right call. We tried with that and I'M not sure.
- [37:18]
A
Okay. Why don't we write positioning down right here? Okay. These all. I want to touch on two quick things. My. My issues here.
- [37:32]
B
Yes.
- [37:33]
A
We've got positioning team I want to get into.
- [37:36]
B
Mm.
- [37:38]
A
So let's write team down right there.
- [37:42]
B
Maybe those.
- [37:43]
A
All right. We've got plenty of things to cover here. I want to touch on metrics really quickly. It's so I cannot stress how important it is to have a couple of very simple dashboards that show what is actually happening in the business. And so what you need is you need this funnel view.
- [38:04]
B
Yeah.
- [38:05]
A
And so. And then we need this net new.
- [38:10]
B
Net new. Yeah.
- [38:11]
A
And so I need to be able to see. If we look at. And I guess we need conversions are in the funnel.
- [38:19]
B
Yeah.
- [38:21]
A
But I. I need you to be able to look at a metric and know exactly what's happening. Because you can see that like, you know, on a weekly basis. Right. Here's how it's fluctuating. Now. I put that under funnel. That's. Yeah, you get the idea.
- [38:36]
B
Yeah, yeah.
- [38:37]
A
That should be right over here.
- [38:39]
B
Okay.
- [38:42]
A
But that you can know this is healthy. This is what's going on. And then as you go to team, each of these metrics have to have someone responsible.
- [38:50]
B
Right.
- [38:52]
A
And so if you break down the people working on marketing and growth.
- [38:57]
B
Yes.
- [38:58]
A
They have to be responsible for.
- [38:59]
B
For one of the metrics.
- [39:00]
A
One of the metrics.
- [39:01]
B
Okay.
- [39:01]
A
I'm trying to think of how to phrase it, but somehow we need the. You know, it's like identify key metrics, each with an owner.
- [39:10]
B
Yeah.
- [39:10]
A
How would we phrase that in a. In a clean. You're the.
- [39:14]
B
You're the key matrix. With. No, with. Yeah, yeah.
- [39:16]
A
Key metrics for the owner.
- [39:17]
B
Yeah.
- [39:20]
A
Perfect. And then we're going to need. So this is understood in this. The key metrics, we're going to have two, maybe three dashboards.
- [39:28]
B
Yeah.
- [39:29]
A
And those are the things that are going to be viewed continually.
- [39:32]
B
Continually. Yeah.
- [39:35]
A
So then the next thing that we need for accountability on this is we need meetings. Just one. It could be 10 minutes long, but on a weekly basis, preferably on a Monday.
- [39:46]
B
Yeah.
- [39:47]
A
You're going to get the people who are responsible and they're going to report on. Here's how my metric is doing inside of Kit. We call these initiative meetings.
- [39:55]
B
Huh.
- [39:56]
A
We have four of them.
- [39:57]
B
Yeah.
- [39:58]
A
And we have one around revenue, which is really about our funnel, about needs. All of that, you know, awareness, like, is search traffic doing what it's supposed to is all right.
- [40:10]
B
Right.
- [40:10]
A
And so each person is reporting on I own the affiliate channel. Here's what affiliates has done, how it's performing over this week. Here's the actions we're taking to fix it next. And that was their 62nd update.
- [40:21]
B
Yeah.
- [40:22]
A
And it's just really about accountability.
- [40:24]
B
Okay.
- [40:25]
A
And so I think you need to add that meeting.
- [40:29]
B
Yes.
- [40:29]
A
I think it should be maybe initially it's 30 minutes and you'll get it dialed in where you're really trying to find the signal versus noise. And so I would put key metrics with owner. Maybe you add another two item. Just say revenue meeting. Right. That's kind of the main thing that we care about. And so now we're going to dive deep into each one of those. You know, customer support really ties into revenue. So. And because it's a small team.
- [40:58]
B
Yeah.
- [40:59]
A
I would just have this, like, really tight, hey, here's our happiness metrics. Here's how many tickets we answered. You know, here's all of that happiness matrix. Yeah. I would just. It's within this. Within this meeting. So revenue six or six hours. Yeah. And you'll touch on the funnel review and all that. So now that. Now what we have is the business is broken out, where people own different aspects of the performance of it and there is weekly accountability to how is it performing.
- [41:30]
B
Okay.
- [41:31]
A
And weekly awareness.
- [41:33]
B
Yes.
- [41:33]
A
Right. If I were to ask your marketing team, what did traffic do last week? You think they'll know off the top of their heads?
- [41:38]
B
No.
- [41:39]
A
Yeah. And we didn't hit either. Right. Now we do. Now everybody knows. Right. And you know, to fix it because, you know, do everything you can to fix it. Like, did you do the actions?
- [41:51]
B
Yes. Yes.
- [41:53]
A
The other thing that you can get into is lead measures versus lag measures. Right.
- [41:58]
B
Yeah.
- [41:59]
A
Because basically, did we do our projects, which are leading indicators.
- [42:02]
B
Yeah.
- [42:02]
A
And then when do we expect them to show up, to show up in the lagging indicators?
- [42:05]
B
Yeah.
- [42:06]
A
All right, so now we have those things. So once we identify the metrics, we at least know what's going on. You know, we're getting into like what gets measured, gets managed.
- [42:14]
B
Yes.
- [42:15]
A
Type of idea. But let's go, let's go to our next item, which is traffic and awareness as a whole.
- [42:21]
B
Yeah.
- [42:22]
A
You have felt firsthand what it looks like when you have a huge spike of awareness.
- [42:29]
B
Yes. Right.
- [42:30]
A
You get this article, you get all these other things. So as far as what's worked for attention.
- [42:37]
B
Yeah. Let me just.
- [42:39]
A
We'll write down attention. We'll make a list. So it's been content.
- [42:47]
B
Yes.
- [42:48]
A
What else?
- [42:51]
B
So we have. Yeah.
- [42:54]
A
It's content from other people almost entirely. Right.
- [42:56]
B
Yeah.
- [42:56]
A
Has it been content from you all as well?
- [42:58]
B
We have. So we have a bi weekly podcast. Okay.
- [43:03]
A
Does anyone listen to it?
- [43:04]
B
Yeah, I mean, we have, like, but not many. Like 300, 400 people per episode. Like it's 600 people per episode. Okay. So we have that podcast. And because of the podcast, we also. Because the podcast is also. The idea for the podcast is also that in each episode we try to also deal with some advice for our users.
- [43:29]
A
If we shut down the podcast today, what would happen to traffic? Traffic to this funnel?
- [43:36]
B
I'm not sure. I'll have to figure it out.
- [43:41]
A
Do you? My gut feeling is nothing.
- [43:43]
B
Yeah. Could be.
- [43:46]
A
So I would look at. I would look hard at the content that you're doing, what you're spending.
- [43:50]
B
Yeah.
- [43:50]
A
To create that. And if it's. If it's creative result now, it might not be affecting the. The growth.
- [43:58]
B
Yeah.
- [43:58]
A
But it might be helping with retention because your true fans absolutely love it.
- [44:01]
B
Yeah.
- [44:01]
A
And this is a good touch point.
- [44:03]
B
Yes.
- [44:03]
A
But you really watch for these things that you're doing that it's emotion that you're going through, but it's not.
- [44:11]
B
Yeah, that's true. It's like when I heard one of your previous shows, one of the mistakes people make, they don't reach past 1 million, is they stick to what's something that worked in the past, but, you
- [44:24]
A
know, or another interesting exercise. If you look at your team, if we dive into that one for a second, if you imagine this, this little box, that's your company. Sometimes these teams and Kit has done this too often.
- [44:39]
B
Yeah.
- [44:40]
A
Everything, all the attention and energy and conversations and everything else is inside the box.
- [44:49]
B
Yeah.
- [44:50]
A
You know, and you can fall into this trap with the metrics. Right?
- [44:53]
B
Yeah.
- [44:54]
A
Now four of us are meeting about what's happening with the metrics, and this is moving in this way. And then if you could close the loop with whoever and meet with this other person. And all we're doing is we're just going around in circles inside our little box. Right. And customers don't know, customers don't care, and all of that. And what you have to do instead is look at. Okay, how much energy is going outside of the box. Right. And it could be in improving the product, it could be in marketing partner conversations, it could be in creating content, it could be in customer support getting out there. And so I find it helpful to break down a team and look at what's inside the box and what's outside the box and how has that changed over time? Something for us, we, when we were in this crazy growth mode, we went from, in a six month period from 10,000 of MRR to 100,000.
- [45:51]
B
Yeah.
- [45:52]
A
And everything that we did was outside of the box. Right. Because people were like, oh, your meeting structure is broken. You're like, yep, we don't, we don't care. We're just trying to keep up. We're just, you know, it was webinars, it was all of these things. How do we, how do we get out there? So I would really look at that from your team. What amount of these people, what amount is internal versus what is actually external, what impacts customers, what impacts awareness? All right, so we're talking about traffic and attention. So content, these big write ups, you know, which I bucketed under press. It's not true press necessarily.
- [46:35]
B
But I want to give you an example of something that did work recently. So I had this idea that they're these productivity consultants or coaches and some of them are really, they have their own kind of special secret sauce of how they're teaching people productivity. And I was naive enough that I thought maybe they could teach their methods using our tool. Because our tool is pretty simple to use, it's pretty simple to onboard. So they could have their content there and teach their productivity principles using our very flexible, very cool app. And basically it mostly failed. So we have this expert program, we have a few experts on board it, except for one person. So there's this woman in Poland, she's a consultant and she had this idea that she is teaching other business women how to get their files organized on the computer. And she was so good at this. Then they later asked her, can you teach us project management? And she's doing it with us, so using our tool. So for example, whenever she onboards new customers to her, she sells her course. Each of these new customers, they get a free Nozbe account for duration of the course. Okay. And then she basically does the onboarding for us because she teaches them how to set up their company using Nozbe. And then after that they usually extend their subscription. And so it's a win, win, win. Everybody's happy. They are happy because they have set up their business inside of our app and they feel very well organized. She delivered her course, sold the course, and the customers are happy and they extend, not prescription.
- [48:32]
A
Okay, I love that. So that's, that's an example of a partner. Yeah, right. Who is both teaching. Here's how to use the product. Let me help you use it. And all of that, you said that it failed in all of those cases except for her.
- [48:44]
B
Exactly.
- [48:45]
A
Was that because everyone else is different? Because your offer was different?
- [48:49]
B
Like what, what I've. So I realized that some of the, some of these people, they said that they want to be platform agnostic, so they don't want to, you know, commit to one app because there are so many apps and because customers demand that. And she was the only one who had basically the gut to say, no, no, no, I'm going to just teach you through Nozbe if you want to, you know, learn from. In a different tool. Not here, because I'm great at Nozbe and I have my, you know, content and all my, you know, everything prepared with Nozbe. And so she, she was gutsy enough to just use our app and because we were helping her, like a lot because, like, we did special integrations for her so that everything, you know, so we are, we have a great, you know, relationship like this. But like others, they didn't kind of, they couldn't like, you know, make the jump to say that.
- [49:44]
A
Okay, so maybe, yeah, if someone wants to be platform agnostic. Yeah. Which makes sense.
- [49:53]
B
Right?
- [49:53]
A
They want their content to live. And someone's saying, hey, does this still work if I want to use any of these other, these other tools? Yeah, typically it's an incentive problem maybe. And I would say, you know, show me the incentives and I'll show you the outcome.
- [50:09]
B
Okay.
- [50:09]
A
And so in this case, maybe the incentives of I can create less content and training, I can make better outcomes for my customers and I will get all the support from Nozbe, like that to her was worth it, but to everyone else, they looked at that equation and said, it's not worth it to me. And so I would find out what incentives do these people actually care about? Yeah, maybe first of partners. How many people like her exist? Are there thousands? Tens of thousands. Are there enough?
- [50:41]
B
I don't know. We're trying to find out.
- [50:46]
A
So within this, we need incentives. We need to know the total addressable market gut feeling based on the millionaire that we're at now and what it would take to increase awareness. I am, with a hundred percent confidence, the total adjustable market is big enough.
- [51:12]
B
Huh.
- [51:13]
A
Like you.
- [51:14]
B
You think so?
- [51:15]
A
Yeah. There's no limitation on number of partners. The problem is that you're.
- [51:18]
B
Yeah.
- [51:19]
A
They don't know your product exists and they don't know that. They don't feel that the incentives are strong enough to partner with you. So how are you going to fix that?
- [51:30]
B
Well, try to pursue them better and find better incentives for them. So maybe do it like, like, like, like you did with your first customer. Like really target individually and try to convince them individually.
- [51:43]
A
Yeah. So let's look at, you know, one way to get attention is direct sales. I love this method because it is entirely within my control.
- [51:53]
B
Yeah.
- [51:54]
A
Instead of saying, oh, if I do position this in this way, will it get picked up by someone else? All this stuff. Like, it's so hard.
- [52:01]
B
Yeah.
- [52:02]
A
But direct sales is like, well, who did you reach out to? Were they the right people? Did you have good copy? You know, and how long have you been doing this and what was your follow up like? Like, it is entirely on you. And so I, you know, love and hate it for both those reasons.
- [52:18]
B
Yeah.
- [52:22]
A
So the problem here with direct sales in this business is that it's not. Is this right here?
- [52:27]
B
Yeah, Exactly.
- [52:27]
A
It's cheap, $8 a month. You can't afford to. You can't build a sales team. And so that's why it's like, okay, we can't do direct sales for customers. Right. That's not going to work unless you make up some enterprise products and all that. That feels like a really big pivot.
- [52:45]
B
No, exactly.
- [52:46]
A
Yeah.
- [52:47]
B
Okay.
- [52:47]
A
But we can do it for partners.
- [52:49]
B
Exactly. That's true. Because then we have the scale.
- [52:58]
A
Yeah. So the things that, like this is entirely new motion to build up. But the things that I like about this are that in the past you have had partners that find success, that love the product. All of these things, like the core ingredients are there. I think it's the go to market motion. That's not. And so if I were diving in and running this, let me think of what I would do. The things that I'm trying to figure out, I would figure out positioning and then I'd figure out partners and they go hand in hand. Right. We need to figure out what is the positioning that resonates both with the partners and with the people that the partners reach. But then I would be all in on this direct sales motion of how do I get to the partnership. Line up as many partnerships as possible. And then within those partnerships, you're really going to have, I believe, two core methodology or two core conversion methods. One's going to be webinars and then the other is probably like embedded courses. That's what this one was so successful with, right?
- [54:26]
B
Huh? Yes.
- [54:27]
A
Both of these take time to activate, which can be. Yeah, can be difficult. Okay, so before we go further, I want to take a step back and look at everything that we've mapped out.
- [54:36]
B
Yeah.
- [54:36]
A
So we've identified that awareness is the biggest problem in the business.
- [54:39]
B
Yes.
- [54:40]
A
We've identified, we have a flag around team, something around positioning and we need, we need to pull all of this together into a go to market function that's going to drive awareness and traffic and we need to build a team and metrics that can turn this into a machine. I think the problem that we need to solve next is positioning because what worked for the position before is not working now. Exactly what experiments have you run around positioning? What have you, what have you tried? Is there any gut feeling on resonance?
- [55:16]
B
Yeah.
- [55:16]
A
Would resonate.
- [55:17]
B
Yeah. So as I mentioned, we tried to, you know, position to small business owners like, to, to, to like, you know, get them organized and that we. I was trying also to play on the, on the, you know, on the value of, of, of of the software that you know, that like this kind of idea that you know, if you just start using Nozbe, you will, you know, instantly save more than an hour per month. So basically it pays for itself already this kind of thing.
- [55:46]
A
So okay, so let's. What is the promise of nozbe? Why should I sign up?
- [56:00]
B
The promise of Nozbe is that you will have everything well organized.
- [56:09]
A
Okay.
- [56:09]
B
And you know, on your phone everywhere, it syncs everywhere and together with your team you will know exactly who's working on what and.
- [56:26]
A
Oh, and that will result in me saving time.
- [56:28]
B
Exactly.
- [56:29]
A
Isn't this the promise of asana Trello ClickUp? Everybody else could be. So why Nozbe?
- [56:39]
B
Because it's simpler. Okay, it's simpler. So it's.
- [56:42]
A
Why do I care that it's simpler? Simpler is limiting.
- [56:45]
B
Yeah, but simpler is limiting. But on the other hand, simpler makes your team and everyone on your team use it more. Because if. Okay, because the problem is that. So I have this problem with business owners. Business owners say yeah, but I want this and this and these features and we have tried that and we have tested it and when you introduce a complicated piece of software to your team, nobody uses it. While when we introduce Nozbe because it's such a simple structure of projects, tasks
- [57:14]
A
and comments, why does it matter to use it more?
- [57:17]
B
Because then. So just like your metrics that we don't have, like everything else is in Nozbe. So you'll know exactly who's working on what, which projects are open, which tasks are open and if a task has an issue, you can comment and you can just iron out the issue. So you know, so for example, From a business owner standpoint, I don't have to ask my team members what's the status of things. I can just log into Nozbe and just. I can see exactly what's the status of projects and what's going on.
- [57:48]
A
Okay. So it runs the business, but I want to, I want to like drill in on this.
- [57:51]
B
Yeah.
- [57:51]
A
Use it more because you're. You almost have something here. Almost. Okay. So I.
- [58:00]
B
If.
- [58:00]
A
Let's go the other way. I have the most advanced, most sophisticated project management tool. It does everything.
- [58:07]
B
Yeah.
- [58:08]
A
And my team doesn't actually use it.
- [58:10]
B
Exactly.
- [58:10]
A
What happens?
- [58:12]
B
It's useless. Like you're. You do two things or you just drop it, or you invest lots of time to force people and, you know, teach them the software so that they eventually start using it.
- [58:27]
A
Yeah. And if we were to do some very fancy stick figure drawing.
- [58:31]
B
Right.
- [58:32]
A
That is our stick figure person trying to push this boulder up a giant hill.
- [58:38]
B
Exactly. Exactly.
- [58:39]
A
Right.
- [58:39]
B
Yeah.
- [58:40]
A
If you lead a marketing team, if you lead anything else, do you want to spend all of your time pushing, trying to get your team to adopt a tool that has endless friction?
- [58:52]
B
Yeah.
- [58:52]
A
Or do you want them to use the tool that they're going to actually use?
- [58:58]
B
I'll give you an example. So one of our customers is a construction company. Okay. And they have all these projects in Nozbe as. As a different construction sites. Right. And he has all his team, I mean all of the team, the plumbers, like everyone who's in construction in Nozbe and they update their tasks inside of Nozbe. And he said to me, when I was interviewing him and I was asking how the business is going, he told me, now I'm at this stage that if I would tell my team that I'm going to take Nozbe away from them, they would kill me because they got used to using it and they know it's so simple. They can update their things. And from his point of view, he can be visiting his construction sites by just basically opening the projects. So, so, so this is what happens when a success. When they actually use. Yes.
- [59:53]
A
I think that this is your promise.
- [59:56]
B
Yeah, it could be. You're right.
- [59:58]
A
And I think it's. It's. I think it's a very powerful promise because you can sell the pain of what happens if they don't use it.
- [60:07]
B
Exactly.
- [60:08]
A
Right. Because you're constantly chasing people. Did you update this thing?
- [60:12]
B
Yeah.
- [60:12]
A
Oh yeah, I would, but I gotta do it on my computer. It's gonna take so long.
- [60:15]
B
Exactly.
- [60:15]
A
Hold on. Did you want that in a task, in a project or you know, all of these things.
- [60:20]
B
Exactly.
- [60:21]
A
Or you say, look, we strip away everything else. This is the tool that you actually use and that is what gets the results. And so if I were you, I would fix your positioning. Let's write this down as a.
- [60:36]
B
To do fixed positioning.
- [60:37]
A
Fixed positioning. And we're not going to get to the positioning in a one hour podcast episode. No, but we've gotten to like the essence of the core promise. Right. And I think that, that. Yeah, I think because everyone is going to say why? Why nozbe versus ClickUp. Why nozbe versus whoever. And I as a partner can say, because nozbe is the tool that your team will actually use.
- [61:06]
B
Exactly.
- [61:08]
A
And it's not a six month adoption process. It's not chasing them down. You know, all this, like you just actually use it. And you know what? And here's the benefits of actually using it.
- [61:18]
B
You know, sometimes we've had these situations and sometimes a team signed up and the person complained to us that the team is not using it. And then they signed up for a demo with Magda, the whole team. So like she shows up on the zoom and then there is the whole team, you know, looking at her and she does a demo. And after this one demo of half an hour, like it's done. They are just like, then after a month or they extend their plan for a year or something like they. So it's very. In that sense, we've been very successful with that formula that it's really, you know, when the team sees that it's only this, you can add a task like this and it's so simple, they get the aha moment, you know.
- [61:58]
A
Yep. Okay, so we're gonna have to fix the positioning. We're really diving in this. The tool that's actually used. You've got, you've got some fancy illustrations, but.
- [62:10]
B
Exactly.
- [62:10]
A
I'll let you know my hourly rate later.
- [62:12]
B
All right, thank you.
- [62:13]
A
I'll redo your marketing site with my stick figures. Be great.
- [62:16]
B
Yes.
- [62:18]
A
Once we fix the positioning now we can go out to partners.
- [62:22]
B
Yes.
- [62:23]
A
So now we need emotion to like to go out to. To partners. And how do we identify the right people?
- [62:30]
B
Yeah,
- [62:34]
A
I, I think if. So if we, if you write down partners as a to do and then under that. Maybe our sub bullets would be identify. And then. Let's go incentives.
- [62:57]
B
Yes, incentives.
- [63:02]
A
And then if I. Incentives. Let's just say outbound. So within this, because I, I believe that there's almost an endless number of partners Right. Way more than I think so too.
- [63:19]
B
Right.
- [63:20]
A
So what I would do is I would identify all the possible partners.
- [63:24]
B
Okay.
- [63:25]
A
AI is really good at this. So you can, you can help with that. You know, who are. I have this content creator who are 100 people like them, you know, that sort of thing. Go back to everyone who sent referrals in the past and see what are they up to now. Are they still.
- [63:41]
B
Oh, yeah, yeah.
- [63:42]
A
Exactly. Figuring out, I would say, hey, we rebuilt Nazbe from the ground up, and it's incredible. You don't need to mention that you did it in 2020. That was five years ago.
- [63:51]
B
Yeah.
- [63:51]
A
You rebuilt Nozbe from the ground up, and it's incredible. Yeah. And you're going to nail the positioning on this. You have the case study.
- [64:01]
B
Yeah.
- [64:01]
A
Right. So let's just. Where are we going to put this? Maybe right over here. Create case study. We. We have one or two successful partners who are killing it.
- [64:16]
B
Right.
- [64:16]
A
So create case study on them. And so we can go out with that. We're going to. To talk about. Here's how we'd love to partner.
- [64:26]
B
Yeah.
- [64:27]
A
Do you. What's the incentive structure look like? Because that's the next thing we need to get.
- [64:32]
B
Yeah. So for the. For the partner. Yeah. So they have. So when we have the affiliate program, so the referral program, in our referral program, like, we give 25% after revenue for the first two years of a customer.
- [64:49]
A
Okay.
- [64:50]
B
And when you are a partner, you get 30% or more sometimes and for three years. So it's a better incentive in that sense. Plus, the other incentives are what I mentioned. You work with us together, direct line to us. We work with you. We build some features just for you, or kind of for you first. Because this is also our way of sometimes prototyping a feature that, that, you know, if we have one case study that they will actually use it, then we can later build the feature for everyone else.
- [65:21]
A
Okay, so what I would do is I'm thinking about these incentives
- [65:31]
B
because,
- [65:34]
A
like, you often do the math. Someone might not make very much money from one of these. These deals for a while.
- [65:41]
B
Yeah.
- [65:41]
A
Right. Let's say that I do a webinar to 100 people or 100 people show up live to a 10% convert.
- [65:49]
B
Yeah.
- [65:49]
A
You know, now we're like, okay, we actually only when. Now we're selling $80 a month. Yeah, I'm making 30% of that. Right. And so we're like, okay, do a webinar with me and you'll make 25, 30$40 a month, like not super compelling. Yeah. And so you might need to figure out ways to front load some of that. You might not need to do it long term, but because awareness is such a huge problem.
- [66:19]
B
Yes.
- [66:20]
A
If you allocated $5,000 a month of your budget, which might be a big part of the marketing budget, to just say, hey, I will pay you to do this webinar.
- [66:32]
B
Okay.
- [66:32]
A
And teach this workshop and to implement nauseam. You'll make this money upfront. Like it's more of a sponsorship with this, like long tail partner. Then you could learn faster.
- [66:42]
B
Yes.
- [66:42]
A
Because my worry is that the incentives that we have under our partner program, the 30% is not going to be compelling enough to try to try until we have scale and then we're not going to learn enough and it's just going to feel like our outbound function failed, when in reality there's a lot more that could go well with it. So I would spend a lot of time on the incentives and I would be willing to front load some of those incentives. Would you be able to allocate $5,000 a month?
- [67:16]
B
Yeah, okay, sure.
- [67:18]
A
Would you be able to allocate 10,000amonth or is that something tight?
- [67:21]
B
Okay, I'll have to check,
- [67:23]
A
but that would be the kind of thing. Yeah, you know, if you could say, well, let's say 10,000, if that's the number we were working with. Maybe you're doing two. Two that are big, like $3,000 each or something like that. And then you're doing a few that are small, where you're saying, hey, we'll pay you $1,000 to this webinar. All of that. And then they're, they're in it with you and they earn on the long tail.
- [67:48]
B
Yeah.
- [67:48]
A
And you can start to get this motion going. Doesn't mean you need to do it long term.
- [67:52]
B
Yeah.
- [67:53]
A
But then you'll have more case studies, you'll have more numbers and, and on from there. Okay, now let's talk about the outbound function. So now you need someone who is doing that outbound sales. Is that you? Is that someone else? Like, what's your gut instinct on it?
- [68:17]
B
Yeah, this. In the beginning it would be me and probably one more person.
- [68:22]
A
One of your team members.
- [68:23]
B
Yeah, yeah, yeah. Especially, especially in the beginning. You always said that it's good that we do it actually to see.
- [68:31]
A
I think so you'll get, also get a higher conversion rate. Just as the, as the founder, CEO, you know, you have the passion for the product that will come through. So I Think that you need a way to tee up as many of these opportunities as possible. I think the AI sales development reps are getting pretty good. So I would go read there's articles from Jason Lemkin Saster.
- [68:55]
B
Okay.
- [68:55]
A
On that exact process. So I'd probably take one of your marketing people and say your job is to get us as many leads and opportunities as possible.
- [69:06]
B
Right.
- [69:06]
A
For Outbound and make sure the contact info is good and all of that and use AI as much as possible and build the systems to help do that. And then in your pipeline, like your metrics, revenue pipeline call, they're going to be reporting on how many people they reach out to.
- [69:20]
B
Yeah.
- [69:21]
A
And all of that. You just don't want it to entirely rely on you.
- [69:23]
B
Yes.
- [69:24]
A
Because it's not going to scale.
- [69:27]
B
Yeah.
- [69:28]
A
The follow up's not there, that sort of thing. But make sure that all of your. Everything related to Outbound is instrumented in the metrics too. And then you can see and you have accountability.
- [69:39]
B
Yeah.
- [69:39]
A
And you can break it down. And then I would just have the goals be around. Okay. How many partners can we onboard? And then we'll get to the point of how many webinars or courses are we getting added into? Because you've proven in the past that this can work.
- [69:54]
B
Yeah.
- [69:55]
A
And then I'd go back to all the previous partners as well.
- [69:59]
B
Yeah. That's the thing. So in the past. So in the 2010s, we built lots of goodwill in the whole kind of productivity space because we had also a magazine was called Productive Magazine and it was kind of famous at some point. And then people actually liked writing for it because distribution was there. So sometimes I even forget that we have some goodwill that we completely forgot that we left it there and never came back to it.
- [70:30]
A
Yep. Yeah. There's so much of that. And I would just really be thinking about, okay, how can I get as much of my attention and the attention of these 15 people. Outbound.
- [70:43]
B
Outbound.
- [70:44]
A
And try to take a step back and look. Okay. If people aren't in our internal. If they're not in our own NASB account, they're not seeing what's happening. If I were to just go out of that, open an incognito window and go to the marketing website to everything coming out of this business, what's happening. Because often there's not a lot.
- [71:05]
B
Yeah.
- [71:06]
A
And so get Outbound in those ways. Advertising is not going to be the answer because the average revenue per user is too low.
- [71:14]
B
Yeah. And the bidders are. Yeah. They have Much more money.
- [71:19]
A
The other thing that I would do, I think these true fans are interesting. I would go to the customers that you have that are the true fans, and I would say, hey, who do you follow for productivity advice? How to run your business better or business advice? Business advice. But like, business advice is very broad.
- [71:42]
B
Yeah.
- [71:42]
A
You know, business operations, trying to narrow it just a little bit. And then the cool thing is it'll give you. It'll help you brainstorm and like identify as many of these partners as possible. But then when you reach out and you can say that, you can say, hey. So I was talking to one of my customers who runs this really cool construction business, and I was asking him, hey, who do you follow on how to run this business better? And he said, you and you. And that's like a little bit of. Because people always want to hear who their customers are and all of that. So that's how you can really leverage those true fans.
- [72:25]
B
Yeah, that's a good idea.
- [72:30]
A
And there's a lot of other things that we'll get to, but maybe just to touch on some final things. Really look at the team. Right. Because we have constrained resources.
- [72:40]
B
Yes.
- [72:40]
A
We got that million dollars a year.
- [72:41]
B
Yeah.
- [72:42]
A
And so really make sure. Do I have exactly the right team to take me to where I need to go? Is everyone owning a metric and directly working on that? And if we're going all in on partners, like, how do we make sure that everyone is on board is driving towards that? Because if you were to say, you know, if you were to go from 15 people down to 11, that would free up more money to be able to pay partners, which would solve our traffic problem. Right. A lot of times when we build companies over a long period of time, we end up with team members.
- [73:19]
B
Yeah.
- [73:20]
A
That we like, they do good work, but it's not aligned with.
- [73:25]
B
With what we want.
- [73:25]
A
Like the go to market motion that we chose.
- [73:28]
B
Yeah. Yeah.
- [73:30]
A
Kind of the last thing as we go touch on partners. You just always looking for who is the person that comes in contact with my ideal customer on a regular basis.
- [73:39]
B
Yeah.
- [73:40]
A
Your product is so broad. I really wanted to find like a niche that we get to or something else. I didn't find it, but keep looking for it because it might be there. But then just see is. Is there this type of person that is out there?
- [73:52]
B
Yeah, yeah. It's like with the case study that we mentioned with her, it was like such a cool idea that, that like she, she. Because of. She's. She's a lady and she's a, you know, business owner. Female business owner. So she attracting, you know, people like her. People like her. And then they. And then because, you know, women are much more better organized than we are guys. So for them, it's like, it's perfect positioning. Like, it was one of her customers that brought her to Nozbe.
- [74:25]
A
Okay, so, I mean, that gets back to this. True fans.
- [74:27]
B
Yes, exactly.
- [74:29]
A
I love it. Okay, so I think you have quite a to do list to dive into. I just want to ask, like, how do you feel now after we've torn apart your business and really dove into it versus when you first came in?
- [74:42]
B
No, I feel so much better. And, you know, when we started with preparing for this, for this podcast, and I saw you, like, didn't know from which angle to attack. For me, for me, the value was just to go through this with you.
- [74:56]
A
Yeah.
- [74:56]
B
Because then, as you have seen, like, things start to show up, and then some of the stories I mentioned actually make sense into. Into something bigger than I thought. So, um, I like this. I like this approach, and I like my to do list, so. And yeah, after this, I have to be able to later, you know, and in a few months report to you that I'm actually doing my homework.
- [75:20]
A
So that'll be good. That's part of it. Well, you can take your to do list, you can load it up into Nozbe. You can dial in the positioning around, you know, products that people actually use. Yeah, yeah. And I'd say for anyone following along, you know, if you want to go check out nozbe, just nozbe.com nazbee.com and
- [75:37]
B
O Z Be does come. Perfect.
- [75:38]
A
And then they can dive in and implement their business on a productivity tool that their team will actually use.
- [75:44]
B
Exactly.
- [75:45]
A
I love it. Michael, thanks so much for coming on.
- [75:47]
B
Thanks, Nathan.
- [75:48]
A
If you enjoyed this episode, go to YouTube and search the Nathan Barry show. Then hit subscribe and make sure to like the video and drop a comment. I'd love to hear what some of your favorite parts of the video were. And also, just who else do you think we should have on the show? Thank you so much for listening.