413: ClickFunnels: Bootstrapping a SaaS to $140M ARR with Webinars - with Todd Dickerson

Summary

Episode Summary: The SaaS Podcast - Episode 413: ClickFunnels: Bootstrapping a SaaS to $140M ARR with Webinars - with Todd Dickerson

Podcast Information:

• Title: The SaaS Podcast - SaaS, Startups, Growth Hacking & Entrepreneurship
• Host: Omer Khan
• Guest: Todd Dickerson, Co-founder of ClickFunnels
• Release Date: September 26, 2024

---

1. Introduction and Background

In Episode 413 of The SaaS Podcast, host Omar Khan welcomes Todd Dickerson, the co-founder of ClickFunnels, a leading SaaS platform designed to help businesses build and optimize sales funnels for online sales. ClickFunnels has achieved remarkable success, growing to over $140 million in Annual Recurring Revenue (ARR) and serving more than 100,000 customers—all while remaining fully bootstrapped.

Notable Quote:

Todd Dickerson [04:25]: "Knowledge is knowing that you know nothing."
(Timestamp: 04:25)

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2. The Origin Story of ClickFunnels

Todd's journey with ClickFunnels began in 2011 when he responded to an email from Russell Brunson, a prominent internet marketer seeking assistance with a Ruby on Rails (Rails) application. At the time, Russell's team struggled to get their Rails app operational. Todd, with his expertise in Rails, helped stabilize the app, laying the foundation for a strong partnership.

Over the next few years, Todd and Russell collaborated on various projects, culminating in the launch of ClickFunnels in 2014. Their mission was to simplify the process of building sales funnels for online businesses, leveraging Russell's extensive audience.

Notable Quote:

Todd Dickerson [05:43]: "We're about to celebrate our 10-year anniversary next month."
(Timestamp: 05:43)

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3. Launching ClickFunnels: Expectations vs. Reality

Upon launching ClickFunnels, the duo anticipated attracting around 10,000 customers swiftly, thanks to Russell's large and engaged audience. However, the initial response was underwhelming, with only about a thousand sign-ups. This discrepancy between expectations and reality highlighted the challenges of launching a SaaS product, even with a built-in audience.

Notable Quote:

Todd Dickerson [23:36]: "Russell thought it was going to do 10,000 customers at launch, but we ended up with about a thousand. I thought that was great—proof of concept."
(Timestamp: 23:36)

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4. The Breakthrough: Funnel Hacks Masterclass and Webinars

The turning point for ClickFunnels came when Russell Brunson introduced the Funnel Hacks Masterclass, priced at $997, at a live event. This masterclass bundled ClickFunnels software for free, leading to nearly half of the event attendees purchasing the product. This strategy proved to be their primary growth engine.

Following this success, Todd and Russell initiated weekly webinars, driving traffic primarily through Facebook ads. These live sessions combined valuable training with sales pitches, creating a highly effective conversion mechanism. By continuously refining their webinar approach and integrating live interactions, ClickFunnels significantly boosted its customer acquisition.

Notable Quote:

Todd Dickerson [33:39]: "Russell had to figure out how to sell ClickFunnels at a $1,000 price point, which led to the creation of the Funnel Hacks Masterclass."
(Timestamp: 33:39)

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5. Scaling Challenges: Database Outage and Infrastructure Growth

As ClickFunnels grew, so did its challenges. The first major crisis occurred when their database host experienced a critical outage lasting eight hours, resulting in the loss of the database. This outage threatened both their revenue and reputation, leading to intense customer backlash, including death threats directed at Russell Brunson.

At the time, ClickFunnels operated with a small engineering team of about five engineers supporting 10,000 customers. Todd and his team scrambled to migrate the database to Amazon Aurora, restoring service faster than expected and improving system performance tenfold. Despite the eight-hour downtime, effective crisis management and transparent communication helped mitigate long-term damage.

Notable Quote:

Todd Dickerson [52:45]: "Russell stepped up completely by going live on Facebook to address the outage, showing vulnerability and transparency, which garnered community support."
(Timestamp: 52:45)

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6. Growth Through Multiple Revenue Streams

ClickFunnels employed a multifaceted growth strategy by integrating various revenue streams around their core product. This approach included:

• Webinars: Selling courses bundled with ClickFunnels software.
• Books: Offering free plus shipping books with upsells to additional products like audiobooks and courses.
• Coaching Programs: Providing higher-tier consulting services.
• Live Events: Hosting events to generate additional revenue.

By layering these offerings, ClickFunnels effectively lowered customer acquisition costs and maximized lifetime value. This strategy allowed them to reinvest in marketing and scale continuously without external funding.

Notable Quote:

Todd Dickerson [44:17]: "We practice what we preach by stacking layers around our core product, enabling us to spend more on advertising than competitors who have fewer revenue streams."
(Timestamp: 44:17)

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7. Evolving the Product and Future Directions

Todd emphasized the importance of building a flexible platform that can adapt to changing market needs. ClickFunnels continuously evolves by adding features such as e-commerce capabilities, membership sites, and automation workflows. The focus remains on understanding customer needs and rapidly implementing solutions to ensure the platform remains indispensable for their users.

Looking ahead, Todd expressed excitement about integrating AI into ClickFunnels to further automate and streamline funnel building, enhancing user experience and efficiency.

Notable Quote:

Todd Dickerson [62:10]: "We're working on AI funnel builders to automate as much as possible for our users, making it easier for them to get started."
(Timestamp: 62:10)

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8. Lessons Learned and Key Takeaways

Throughout the episode, Todd shared several invaluable lessons for SaaS founders:

• Stay Humble and Curious: Embrace continuous learning and remain adaptable.
• Customer-Centric Approach: Prioritize customer needs and feedback in product development.
• Effective Crisis Management: Transparent communication during crises can preserve customer trust.
• Diversified Revenue Streams: Layering multiple offerings around the core product can optimize growth and sustainability.
• Persistence and Stubbornness: Maintain unwavering commitment to your vision despite challenges.

Notable Quote:

Todd Dickerson [61:21]: "One attribute of a successful founder is stubborn persistence—you have to stick to your vision and not listen to the haters."
(Timestamp: 61:21)

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9. Lightning Round Highlights

In a rapid-fire segment, Todd shared personal insights and preferences:

• Best Business Advice: "Find a level 10 opportunity."
  (Timestamp: 60:27)

• Recommended Book: Think and Grow Rich for foundational mindset; Buy Back Your Time by Dan Martell as a recent favorite.
  (Timestamp: 60:55)

• Successful Founder Trait: "Stubborn persistence and unwavering commitment to your vision."
  (Timestamp: 61:21)

• Productivity Habit: Waking up early and maintaining a fitness regimen to start the day proactively.
  (Timestamp: 61:42)

• Future Business Idea: Enhancing ClickFunnels with AI-driven funnel builders for greater automation.
  (Timestamp: 62:10)

• Fun Fact: Todd is proficient at the computer game League of Legends.
  (Timestamp: 62:44)

• Passion Outside Work: Dedicated to fitness and maintaining a healthy lifestyle, especially after turning 40.
  (Timestamp: 63:00)

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10. Conclusion

Omar Khan concludes the episode by highlighting the unique and unconventional path ClickFunnels has taken to achieve substantial growth without external funding. Todd's insights provide a roadmap for SaaS founders aiming to build scalable, resilient businesses through strategic partnerships, effective marketing, and a customer-first mentality.

For those interested in learning more about ClickFunnels or connecting with Todd Dickerson, visit ClickFunnels.com or reach out to Todd via his LinkedIn profile.

Final Notable Quote:

Todd Dickerson [64:10]: "It works in mysterious ways."
(Timestamp: 64:10)

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Key Insights and Lessons:

1. Strategic Partnerships: Responding to opportunities, even unconventional ones, can lead to significant business transformations.
2. Adaptive Marketing Strategies: Leveraging webinars and bundled offers effectively can overcome initial market resistance.
3. Resilient Infrastructure: Investing in reliable technology and having contingency plans is crucial for maintaining customer trust.
4. Diversifying Revenue Streams: Creating multiple layers around the core product can enhance growth and sustainability.
5. Customer Engagement: Continuous interaction with customers through live sessions helps refine products and build loyalty.

---

This episode serves as an inspirational case study for SaaS entrepreneurs, illustrating how resilience, strategic marketing, and a deep understanding of customer needs can drive a startup to impressive heights without relying on external funding.

Transcript

[Omar Khan]

Welcome to another episode of the SaaS podcast. I'm your host Omar Khan, and this is a show where I interview proven founders and industry experts who share their stories, strategies and insights to help you build, launch and grow your SaaS business. In this episode, I talked to Todd Dickerson, the co founder of ClickFunnels, a SaaS platform that helps businesses build and optimize sales funnels to sell products and services online. In 2011, Todd replied to a mass email from Internet marketer Russell Brunson, who was looking for help with the Ruby on Rails app. That email reply changed the course of Todd's life. After helping Russell and his team with the app, Todd and Russell collaborated on various projects over the next few years. Eventually, they decided to launch ClickFunnels in 2014 with a mission to simplify the process of building sales funnels for online businesses. With Russell's large audience, which he'd built over many years, they expected ClickFunnels to attract 10,000 customers pretty quickly. But their initial launch only brought in about a thousand signups, which fell well short of their hopes and expectations. Their breakthrough came when Russell created and sold a Funnel hacks masterclass for $997 at an event and bundled the ClickFunnel software for free. Nearly half the attendees purchased the product. This strategy became their primary growth engine. Over the next few years, they ran weekly webinars, driving traffic from Facebook ads to live sessions where Russell would teach and then sell the training and software. One of their biggest challenges came when they faced a critical database outage that lasted eight hours. It was a major crisis that threatened both their revenue and reputation, with some customers even sending death threats. Another major challenge was scaling their infrastructure. With only five engineers at the time supporting 10,000 customers, the team struggled to keep the platform stable while adding new features. Today, ClickFunnels generates over $140 million in ARR, serves over 100,000 customers, and is still fully bootstrapped. In this episode, you'll learn what strategies help ClickFunnels grow to nine figures in ARR without relying on external funding, how the founders built an effective sales funnel that consistently generates revenue, why you should consider creating additional revenue streams around your core product to strengthen your SaaS business, how testing live webinars could help you refine your sales process and increase conversions and how the founders handled a major crisis that could have killed the business and the key lessons for other SaaS founders. So I hope you enjoy it. Are you building a software product? Then you probably know how challenging it is to find competent engineers, you don't have to micromanage. And then you have all those worries. Will this app work correctly? Can it handle millions of users without crashing? Can I trust these developers when I don't know what they're doing? That's where Accel Hub comes in. With 10 years of software experience, they do things differently. You'll work directly with Phil, their CEO and technical leader. No middlemen, no managing multiple developers. Phil guides the entire process and personally oversees your product. Think of him as your technical co founder minus the equity stake. He brings his expert team to build your app right from day one. Ready to make quality software without the headaches, visit axlehub.com that's a X E L H U B com this episode is brought to you by Attio, the next generation of CRM. Now imagine a world where your CRM is powerful, easily configured and deeply intuitive. Well, Atio makes that a reality. You can set it up in less than a minute and in seconds of syncing your email and calendar, you'll see all your relationships in one place, all enriched with valuable data. You can also build zapier style automations, get powerful reports and seamlessly handle any go to market motion. From PLG to sales led, Attio is designed for the next era of companies like yours. So it's time to say goodbye to inflexible one size fits all CRMs and join industry leaders like 11 Labs, replicate modal and more. To scale your startup to the next level, you can try Attio for [e-mail] that's attio.com Todd, welcome to the show.

[Todd Dickerson]

Awesome. Thanks to be here, man. Excited.

[Omar Khan]

My pleasure. Do you have a favorite quote, something that inspires or motivates you that you can share with us?

[Todd Dickerson]

I do actually. This has been my favorite quote since high school and it's true knowledge is knowing that you know nothing. It's a Socrates quote. It kind of reminds me to stay humble and stay hungry for learning and just exploring new things. And yeah, it's a. It's a great quote to keep in mind as you. As you grow a business and especially as you get bigger.

[Omar Khan]

Great. So tell us about ClickFunnels for people who don't know what does the product do, who's it for and what's the main problem you're helping to olve.

[Todd Dickerson]

Yeah, so ClickFunnels is the easiest and most profitable way to sell anything online across any industry. That's kind of the way I like to pitch it and talk about it. We basically are for anyone who's starting a business. It's a broad market that we're targeting these days. But everyone who's going online to sell, they need to collect leads, they need to make basic purchases and sells. And clickfunnels really makes that super easy to do without tech team behind you, without developers, without anything else. And as we've, we've grown the platform, it incorporates more and more features that people are looking for around that Great.

[Omar Khan]

And give us a sense of the size of the business. Where are you in terms of revenue, customers, size of team?

[Todd Dickerson]

Yeah, we, I think last year was around 140 million. We had about 100,000 users right now and I think we're around 300 employees.

[Omar Khan]

Great. And the business was founded in 2014.

[Todd Dickerson]

2014. We have our 10 year anniversary next month.

[Omar Khan]

Woohoo. Oh, that's so funny. It's like the 10 year anniversary of this podcast is next month.

[Todd Dickerson]

Is it really?

[Omar Khan]

Yeah. I should come over and celebrate with you guys.

[Todd Dickerson]

We're doing an online event out in Vegas in a studio out there, so it should be awesome.

[Omar Khan]

Great. All right, so let's, It's a really interesting story of how you, how you ended up building this business. And it all started with a random email one day from Russell Bronson, who's your co founder, for people who may not know who Russell is. You know, SaaS, people who maybe just don't know that much about clickfunnels for whatever reasons. Just give us, just help them understand who Russell is.

[Todd Dickerson]

Yeah. So Russell, I was on his email list probably 14 years ago and that's how we ended up like getting in touch originally. But he was at the time just teaching people how to sell online, teaching people how to create ebooks, info products, software products even at the time, and was basically just teaching people what he was doing and learning behind the scenes. He was teaching people how to create, opt in pages, write copy, make initial sells and that kind of stuff. And that's how I had ended up actually in his ecosystem. I was building software. So I was, I was trying to sell software myself 14 years ago, 15 years ago. And I was just trying to learn from everyone I could around marketing strategies and ways to get leads and ways to upsell people and ascend people through stuff. And I was just absorbing everything I could. And I'd gotten into Russell's ecosystem at the time and was on his list.

[Omar Khan]

And so this was probably about two or three years before you guys started clickfunnels. You got this, you got this random Email from Russell. He just sent it out to a bunch of people and it was just a plea for help.

[Todd Dickerson]

Yeah. So just to give a little bit of context on what I was doing at the time, I kind of had gotten into the world of SEO. So I'd been building a lot of websites. I had like probably 1500 different websites, SEO properties where I was running ads on them and all this kind of stuff. Right. But I was also making SEO software to optimize my own sites. And without getting into detail details on all like the software, I basically got it to the point where I felt like I was kind of maxed out on the industry. You know, I was ranked number one for my keywords, I was doing my thing. And I was honestly living like a four hour work week lifestyle, kind of, which was great. Like Tim Ferriss. Right. Like that was the thing. This was like shortly after his book was originally came out and I was like, that sounds like a fun goal. Nobody told me it wasn't realistic, so I just did it. But I'd honestly got to the spot where I was kind of looking for my next thing. I felt like, this is fun, but how long can I just fight with Google over SEO rankings? Like, there's got to be something more that I could do. So he sends an email out to his list. He had just acquired another website. He had bought an app and it was a Ruby on RHELS app. And this was literally like shortly after RHELs 1.0 had released. There were very few RHELS developers out there, but I had actually built my app on Ruby on Rails right after it came out. Got involved with a startup weekend and it had just randomly launched, learned RHELs and we built a startup weekend app. And anyway, so I had some experience with RHELs. So I get this email on a marketing list. You got to think like every email that's coming from Russell is like, how to get higher conversions on your opt in page and write an info book product. All these things. And I get an email about Ruby on rhel. I'm like, this jumps out at me. I'm like, there's no way there's anyone else on his email list that knows Ruby on Rails except me.

[Omar Khan]

Is it true that no one on his team knew Ruby on Rails either and they'd acquired this product?

[Todd Dickerson]

Yeah. So basically I find all this stuff out later. But he had a team of 10 developers, none of them, and they had new Ruby on RHELs. They were like maybe PHP guys or something at the time. And back then it was not easy to run a RHEL's app. We were using like Mongrels and like there was this like whole ordeal, like Capistrano deployment scripts to like do anything. Like it was just this nightmare to get anything working. And he had 10 guys on his team, they'd been working on it for a month, could not get the thing running. It was still not done. I didn't know that this email he sent was his last ditch effort before he just threw that business away. He was just going to throw it away, write it off as a write off for the business he acquired here he had bought. And then he's like, you know what, I wonder if there's somebody on my list. So sends this email out. I reply to this email basically the next day. I actually knew some like similar people. So I was like, hey man, I'm not looking for a job, but if you wanted to partner on this thing, I'll partner with you on it. I'll do the work and like you sell it and do your thing. And he's like, sounds great. And of course I didn't know he was about to throw the thing away if I hadn't replied. So he emails it over on like a Friday and I spend the weekend kind of getting the thing back online, fixing up bugs, like making it do what it was supposed to do. It was actually a email service provider platform at the time. So I get it working, get it running and I'm like, hey man, I fixed it all up, here's the logins, here's how it works. Found some issues, I think we should do this, but it's working. So I sent it over to him and again, little did I know he tells his side of the story. But like he had, he was expecting me to like reply back Sooner, not like 72 hours later. So I didn't reply back immediately. And he's like, man, this guy took my code, he disappeared, he stole my website. Like, he's like, he's like thinking I did the opposite. And then I show up with it and he's like, oh wow. Like I. My team's been working on this for a month and they couldn't get it running and you did in a weekend. So I kind of started our relationship. Of course I just had a lot of experience with that technology and his team didn't. But that started our relationship and kind of started what became a big partnership.

[Omar Khan]

I think I read somewhere that said you didn't want to be paid for the work that you did.

[Todd Dickerson]

Yeah, I mean, because I had like the four hour workweek business thing that like I had running on the side. I basically was looking for something bigger, right? I was looking for like a partnership. I was looking for what became ClickFunnels from day one. Like literally I was pitching him on ideas that were. Are now part of Clickfunnels. And some of it was like marketing automation stuff and whatnot. And pitching him on like, hey man, we should build this platform. You've got an audience. I can build the thing. Like we'll figure out how to sell it. Like we'll make this thing a thing. And he's like, yeah, okay, okay, maybe, maybe. But yeah, I basically was like, nah, don't pay me. I want equity. I want, I want profit share. If the company makes money, the project makes money. Pay me. Otherwise I'll just, I'll be over here. I'm okay. I'm covering my expenses with what I've got going on on the side anyway. So yeah, it was unique. Unique situation. There was a point where he eventually he tells the story as he was in his office and he's like asking his. His guy that directed business operations. He's like, how much did we pay Todd last month? Or whatever. And br. Nothing. Like we haven't paid him in like three months. Like it's not making any money. So we didn't pay him anything. And he's like, Todd is like running our entire business. I think we should send him some money. So eventually he did put me on like a payroll for like a year there. In between that he's. We had projects that weren't making anything. So I'm like, sure, you can pay me something. Just keep in mind I'm looking for a partnership, right? So yeah, there was. Those were pre click funnels. That's like we were building. We built probably 15 different businesses while I was working with them. I say businesses, some of them were nothing more than a landing page and an order page, right? And then some of them were like full blown. We had a supplement business that was doing half a million dollars a month by the time we got done with it and switched it off and switched over to clickfunnels as the focus. But yeah, yeah, it was a wild ride.

[Omar Khan]

So you guys kind of worked on these different kind of ideas for a few years. And then 2014 you launched ClickFunnels. So where did the idea come from? And I know part of it was like Russell had, I guess popularized the whole idea of sales funnels. And back then it was A real pain in the butt for anyone to actually build a funnel. Right. If you didn't know how to code.

[Todd Dickerson]

Yeah. So he was definitely one of the voices out there at the time. And we were. I don't even know if we were really calling them sales funnels at the time. We're definitely, like, we were teaching sales funnel strategy. That was the thing he was teaching. We just, like, sales funnels really hadn't caught on as a phrase until probably about 2014, 2015, after we started stuff. But, yeah, he was basically teaching that strategy, doing that kind of stuff. We were. I'll take a step back, I guess it's a pretty funny story in my perspective, and I guess I'll give the full details of the story. So I'm on a plane to go to Boise, Idaho, which is where Russell's out of. I'm in Atlanta. He's in Boise. I'm on a plane to go to Boise. I'm going out there to work on a project. We were doing automated webinar software. So it was a platform we were building that does automated webinar software. One of the big hurdles that we had, though, in that platform was I or one of the designer developers was having to, like, custom build the landing pages for everyone's automated webinar. Was like, yeah, we need. We've got the forms and the backend stuff, but, like, the page has to be designed for every new thing. And anyway, so I'm flying out. I get a. I'm reading through, like, I don't know, TechCrunch or whatever. I see that LeadPages had raised $5 million, and they had raised it, like, over the past weekend. At the time, Leadpages was nothing more than literally, like, a static page that you could, like, change the headline, change the images. You couldn't move anything around. You couldn't, like, do anything. It was just like, best practice, landing page thing. And I'm like, I'm getting, like, matter and matter on the plan. I'm like, how did they raise five? Like, I can build that this week while we're in Boise. Like, this is not that big of a deal. Like, I'm just like. So I land. I'm like, telling Russell about this, and we're just kind of talking back and forth. I'm like, dude, this is the piece that we need to build for our automated webinar software. We need this landing page that's dynamic and that's customizable, and, like, this is missing. And of course, he's like, well, yeah, but if we're going to build this, we shouldn't just build what they're doing. We got to do way better. Right? And then we sat down and we literally, like, just went to the whiteboard and started mapping, mapping it out, coming up with this plan. And literally, I probably probably spent the entire night mapping it out and working on it. And he was just like, I don't know, man. I don't think we can do this. Like, I had my previous team try and build something kind of down this path, had a completely different name for it and stuff. And he's like, we tried to build it. We wasted a ton of money and a ton of time. Like, I'm like, I think I could build it as long as we're smart about it. Right? So it was like a matter of, like, scoping it down to, like, the pieces. We do the pieces. We rely on third parties to do, like, that kind of stuff. And I kind of broke off and spent six months, like, off on my own prototyping and building what kind of became the first version of ClickFunnels.

[Omar Khan]

Great. So for all the developers and the nerds who are listening here, right? When you come up with a vision for a product, usually it's the kind of thing that, in reality, it's going to take you four or five years, and you still won't have built 50% of what you imagined. Right. And so there's always this thing about the mvp, like, how do you boil it down to something which is valuable enough that you can ship in a fairly short period of time, but it's still, you know, I mean, yeah, they talk about the thing about, you know, not being embarrassed, you know, all that kind of stuff, but nobody wants to be embarrassed about their product. Right? So when you. When you thought about this big vision, and then you start thinking about, okay, how am I going to execute this? What. What was your thought process? And how did you boil it down to something that was manageable?

[Todd Dickerson]

Yeah, I mean, that's hard to be 100% sure on, like, when you're. When you're doing that. Right, Right. But what I basically tried to do was to sit down and say, what do we need? Right? Like, what's, like, the minimum thing? We need to, like, be excited about this. And I think that's important. It can't be minimum in the sense that, like, okay, cool. It kind of does the thing, but I'd never use it. I'm not excited about it. Like, I don't know if I even, like, the Phrase mvp. Like, there's another phrase like exceptional viable product, like that might be a little better, like up more up my alley. But it's a matter of like, what makes me super excited to use this thing. And there is like, so basically we ended up building kind of initially like a better version of leadpages that connected pages together and did like the funnel building process. But while we were doing that, we brought in, and this is a part of the story. I don't know if gets talked about too much, but we brought in another partner. We brought in a designer, so that designer. So we had you sometimes hear the phrase like, hustle, hacker and hipster, like, or whatever. So we had Russell's the hustler, I was the hacker. We were missing the hipster. So we hired a designer, we brought him in to work on this project and he was like, full disclosure, guys. I've been trying to build a page editor myself for five years. And it was like, well, if you've been working on it for five years, I'm pretty sure there's not much conflict of interest, so we're going to do this thing. Well, he decided to get super inspired after he helped us design ours to go finish his. And he actually started from scratch again and built like a new version of what he had worked on for a page editor. So we ended up actually acquiring him and bringing him on as a partner. And this is early 2014. So I was building this backend with a fairly simple editor experience, but, like the full backend experience built out. He was sitting here and in isolation building the editor experience with no backend experience behind it. And then he sent us his video of the editor and it was just so good. It was that exceptional, viable product thing where you're like, everyone's mind will be blown. Drag and drop, move the thing. It's so smooth. The effects work as you would hope, like, just super clean. And he'd basically been building that in the six months I'd been building the other part. So we basically brought him on as a partner, gave him equity and merged the two apps together. Before our big launch. We actually beta launched probably in April before that with the beta. And that's when we started first getting feedback, right? So it was like, people liked it, they thought it was cool, but the number one was request was, why can't I drag things around and move them where they need to be? And that was when we. When he basically brought his editor in the picture and we were like, this solves that problem. How do we make this part of our. Part of our vision for ClickFunnels. And yeah, so that kind of answers your question. But yeah, there's a lot going on there.

[Omar Khan]

Yeah. So did he. Did he just build a prototype or was it actually a function? You know, a working front end.

[Todd Dickerson]

He built the entire working front end, but with basically no backend. Like it would like save an HTML page and like, what do you do from here? Right. Like it was that kind of thing, which luckily I had already done the rest of it. So I had already figured out what you do, how do you serve it, how do you scale it, how do you do all the opt in processing and integrations and all that kind of other stuff that I was doing. So he built it literally all client side JavaScript like just kind of went nuts. And the version that's in ClickFunnels classic to this day is basically his version with. With updates from the developers over the years on top of it, obviously. But that's the original, original editor that was built in really? JQuery for like no real libraries or anything back then, like JavaScript and jQuery.

[Omar Khan]

Like, yeah, that's, that's before React and Vue and all these frameworks.

[Todd Dickerson]

Right before all that. Yep.

[Omar Khan]

Did you build the backend in Ruby on Rails, by the way?

[Todd Dickerson]

I did. I built the backend in Ruby on Rails. I had to. I was like, we basically went all in on Ruby on Rails at the time. I was super excited about it. I still am to this day. I think we recently built a new version of the platform, which was about four years ago we started that and we chose Ruby on Rails again. There's a lot of benefits to it, in my opinion. I know it can be divisive. It's like almost talking religion or something or politics when you start talking about what your preferred programming language. But I love how simple it is. Like, it's just a fun, elegant language to work in. I'm not sure that it was that fun in 10 years ago, like when it came to deploying things and running it, when you had PHP that would just magically run and work on your servers. But yeah, no, it's built in Ruby on Rails as well.

[Omar Khan]

Yeah, I remember trying to learn Rails. I think probably around that maybe just V1 had been around for a while and it. I loved the elegance, the simplicity, but there was also like this whole thing of like this magic stuff that it was doing. It was just like I couldn't. It kind of left me like feeling like I don't really have control. There's weird stuff going on and I don't really understand it. I think once you get past that, I think life becomes a little bit easier.

[Todd Dickerson]

Yeah, it definitely takes some getting used to. That's one of those things that, like, can. Yeah, you either love it or you hate it. Almost. Right. Like, I personally, once you. Once I figured out most of the backend stuff going, you know, I'm going through the libraries and, you know, commenting and doing stuff anyway, so I'm getting up to speed on how it actually works. And you're like, all right, I can deal with a little bit of magic as long as I know the main stuff that's working. It's not like we all know how the, you know, ones and zeros are working on our operating systems these days either, but a little bit too much magic. And back then, potentially for new users.

[Omar Khan]

Great. Okay, so you've identified a problem. You're inspired by what you're seeing with lead pages. That tells you that there's some validation already there. You've got Russell's audience, a very big audience that you can tap into to sell this product. So once you built that first version of ClickFunnels, I think from what I understand, expectations were pretty sky high. Right. I mean, you got this massive audience. We've got this great product we've kind of had Russell go through and he can use it and he likes this thing. And so you were expecting, like, a lot of people would kind of be running to buy this product, but what happened?

[Todd Dickerson]

Yeah, so, I mean, full disclosure, Russell thought it was going to do 10,000 customers at launch. Like, that was. He's like, we're going up 10,000 users at launch. This is the best thing ever. Any of my list that doesn't buy this is crazy. Like, it's the greatest thing since sliced bread. And not that I'm saying he's wrong. It was just like I was. I had lower expectations. I was like, I'd be happy with a thousand customers at launch. You know, like, that's amazing. Like, we've a hundred grand a year in arrgh out the gate. Great. Like, that's awesome. But he was convinced it would be bigger than that. So I'll give a little bit more context on how we did the launch plan originally. So we started actually planning the launch. There's a, like, affiliate group that Russell had a lot of exposure to, this network of different people that sell products, online info, products, whatever. And we kind of had reached out to all his contacts. We called the Dream 100 list, right? We had reached out to all his top affiliates and been like, hey guys, you have to promote this thing. It's going to be amazing. Like, here's a preview, here's what we're doing. We did that before we made Dylan and the new editor part of the project. So we had planned the launch date based on the original, like call it V1 beta version of ClickFunnels. And we decided we were going to do an upgraded version of it like a month out from launch, maybe, maybe three weeks out from launch. It was like right before launch. So Dylan and I flew to Boise, Idaho and set it in the room for two weeks straight, drinking Red Bull, sleeping, not at all. Merging these two different apps into one app with a hard deadline because we told these affiliates to promote, they cleared their calendars, they were like ready to send emails, there was all this promotional material ready for it. They had, they were ready to go. And we were still like finishing the product, which was most, one of the most stressful situations ever.

[Omar Khan]

But yeah, I want to understand a little bit about that because I think these days when you're building these types of products, you'll have the front end, like React or whatever, and the back end may just be like a bunch of APIs. So it's easy for the front end to call these APIs and get whatever it needs. But I'm assuming that when you built this, you kind of already had your own front end and there wasn't these APIs, and then there's this other front end. And so you've got these kind of these two things which are kind of conflicting with each other that you've got to get working together. Right? So I just want, I think I just want to point that out because it was probably a lot harder to do than something like that might be like trying to do that now.

[Todd Dickerson]

But we created multiple years of tech debt in that two week period of time. Probably like, it was just so. His was, I think he did do Ruby on Rails, but he wasn't a Rails developer. He was very much a JavaScript running guy. He just kind of like had a Rails app that like created a page and loaded a JavaScript editor and then it like saved that to an HTML file on the server. That was kind of it, right? So I had to then go in. I don't think he had like email integrations or any of that stuff built out at all. So I went in and like, I'm like, all right, we got to figure out a way to integrate with all these, like, what happens when someone submits the form? Like, where do we store it? Then how do we trigger, like, sending emails to people? How do we opt them into mailchimp? Like, we were at the time integrating primarily with just third parties. So what we ended up doing, which is kind of a fun story, I don't know if Russell's ever even told this one, we ended up doing what at the time we joked around calling reverse launch because we had to do something for our affiliates. We were like, we have to go live on this date and time. But all that's going to work is building a page and collecting an email. That's it. Like, we don't have integrations working yet. We don't have. We were building membership sites. Membership sites weren't working. E commerce wasn't working. Like, it was just collect the lead, store the lead. That's it. So basically we ended up doing a reverse launch because we had to. We were building the product as we were promoting it, and we launched that version. And then a week later, we're like, cool guys, now you can integrate with mailchimp. And then it was like, a week later, cool guys, now you can build a community. A week later, now you can integrate with Stripe. And we just rolled out. We kept the launch going. Different promotional reasons every week or two for probably the first month or so, month or two, until we got it to what really was the MVP that we were aiming for originally. It really had all the major features that we wanted to incorporate to begin with, which is basically those that I just listed.

[Omar Khan]

Interesting.

[Todd Dickerson]

Yeah, it was. It was one of those things where, like, in hindsight, people were like, that was the best idea ever. Rolling out new features every week. That was so cool. I'm like, yeah, you don't know. We just weren't sleeping. We were just building them for the first time. Like, it was. It was crazy.

[Omar Khan]

Yeah. I think it's funny because you said, you know, when we were kind of designing this thing, we wanted to build something better than. Way better than Lead Pages. But then when you. What you shipped was probably a basic version of leadpages. Right. But you. You kind of added stuff on fairly quickly after that.

[Todd Dickerson]

Yeah, it was basically like at the time, our. Our editor was definitely better. Cause you couldn't like even drag and drop in there. So we launched a better version of LeadPages, essentially, is what we kind of launched. Day one, it was like. But it did none of the other stuff that we had planned yet. And literally, I think it was, yeah, it was over the month or two that we, like, just kind of just went nuts. I mean, we had started it all. Like, there were lots of things that were closed. It was just like a lot of it because we had decided to merge two platforms into one that we just had to be like, well, that used to work. Now we've got to turn it off until we can make it work again. So, yeah, that was. It was fun.

[Omar Khan]

Okay, so big launch, affiliates lined up, sleepless nights. Russell setting this expectation of 10,000 customers. How many did you actually get?

[Todd Dickerson]

I think we hit 90k mrr during that launch phase, which would have been that, like, first month, basically, which I think our price point was about 97. So it was about a thousand customers at the time. So I, I thought it was great. It was a proof of concept. I mean, I don't even think LeadPages was making that much at the time. They had raised money, but I don't know if they were actually making much revenue. So, like, it was great. Like, we got traction, but it was nowhere near what Russell was actually counting on and thinking about with this thing. So he was disappointed. He's like, why are people buying this? Like, what did I miss for market fit? Like, he's going down the list, just kind of banging his head against the wall trying to figure it out. And yeah, like, we had to. We had to wait until we got to the next milestone, I guess, and figured it out.

[Omar Khan]

Yeah, I mean, most founders would be very happy if they had a thousand people signing up for launch. I think the issue here was expectations were much higher and, you know, you guys already had an audience, a big audience that you could market to that Russell had been building for years. So it wasn't like you were going out and saying, oh, we don't know, you know, we don't have an audience and we gotta find the first 10 customers. Right. You had this kind of. This unfair advantage. But as you guys unpack that, like, what was the issue? Why were people not. Why were not as many people buying this as you guys were hoping?

[Todd Dickerson]

Yeah, I think it was a combination of a few things. So, I mean, Russell did have an audience, but his audience was very much like info product buyers, kind of like biz op. They were looking for a business in a box. They were like, you know, I don't know, I'm trying to make money online. Tell me what to do. Right? And this was a tool for businesses to collect leads and like ascend leads and sell products. Like, you had to have something to sell and A lot of his audience just wasn't there yet. They were. They were still learning the ideas. They were excited about doing something online. They weren't necessarily businesses. People that were businesses. A lot of them kind of got it. And if you had tried setting up a WordPress site before, at the time, like, this was way easier, and you're, like, blown away by it. But a lot of the people hadn't done that. And we're still just kind of in the really early days. I mean, that's part of it. I think. There's also. I mean, I don't know. Honestly, I'm not 100% sure. Like, going back and looking at it now, in hindsight, he basically had probably 50,000 people that would open every email he sent. Right. So he could send them to the page. They could review the stuff, they could see it, but they really just didn't maybe get what the value was that it was providing. Right. So it was just like if you had got it, if you'd had the challenges before, if you had tried overcoming those challenges before, yeah, it made sense and you'd identify with it and potentially sign up for a trial. But a lot of those people were still just too early in their journey to understand the value, I think.

[Omar Khan]

Yeah. And I think the other difference was that he had been training his audience to buy basically info products. Right. And to then Suddenly put a SaaS product in front of these people. You know, maybe there was just a learning curve there that or, you know, it kind of. It didn't kind of completely. The dots didn't connect with people. Tell me about that, how that event came about, that Russell kind of, you know, started kind of selling clickfunnels. Because I think that for me, you know, correct me if I'm wrong, but I feel like what you guys have done with selling clickfunnels and the way you sell it kind of packaged around info products and training and all of this stuff is so different to what 99.9% of SaaS companies do. It's a very different way to sell, but it's also a very smart way to recoup customer acquisition costs before they've even paid for a SaaS product and actually kind of lower your cat costs. So we'll unpack that. But I kind of feel like this was sort of the pivotal moment where maybe that shift started to happen.

[Todd Dickerson]

Yeah. So, I mean, another piece of it, I guess, was just the fact that, like, a lot of his audience had seen him sell different things every week. Right. Like, he's selling other people's stuff as an affiliate. He's selling a book on how to, how to make an ebook. Like, he's selling another course on this other thing. So he's selling constantly different things. And even if you're a serious business, if you're seeing like, I don't know, this guy sells a new thing every month. Like, why am I gonna run my entire business on his new thing of the month, right? So it literally, like, even for some of our best friends in the industry, took years before they were like, oh, this ClickFunnels thing is like legit. And like, everybody's using this. Why am I not using it? Like, it took a long time for even the people that knew us well to kind of get over that hurdle. But yeah, I think. Sorry, what was the, what was the second part of that question?

[Omar Khan]

Yeah, so tell me what happened? But how did this event come about that ultimately, you know, you started selling clickfunnels in a. I guess in an unusual way?

[Todd Dickerson]

Yeah. No, so this is a fun story. So Russell had a number of different events that he used to speak at. Back then. He had. They were basically interview Internet marketing style events, right? Like, people are coming, they're trying to learn how to sell online. They might be, might be new businesses, might be experienced businesses, all kinds of different demographics. But ClickFunnels was sponsoring one of those events right out the gate. I mean, this is month two or three after we launched the platform. This is the first probably event we had sponsored at the time. And we're like, all right, let's set up a booth, let's do this thing. And the guy's like, I want Russell to speak and I need you to sell something at $1,000 price point. And Russell's like, I can't sell ClickFunnels at $1,000 price point because people aren't even buying the trial and it's free. And he's just like, I can't do that. And the dude's like, all right, well, you got to figure it out. I need you to sell clickfunnels at a thousand dollar price point. He's like, all right, I'll try and figure it out. Right? So he goes back to the drawing board and we brainstorm some ideas. And he basically comes up with what we were calling the Funnel Hacks Masterclass. So this is before masterclass was the thing. I think we coined the phrase, I don't know. But anyway, so it was like an eight week course and the idea was we were going to take People through building a funnel. And I mean, we had, like, it wasn't like we hadn't proven the funnel concepts. Like, we had a supplement business doing half a million dollars a month in supplement sales on using our exact funnels, exact strategies. So we were able to kind of use these things as examples and be like, here, this works. Here's legitimate examples of this working. Let me teach you how to structure it, how to come up with the offer, how to build the upsells, how to do all this stuff. And oh yeah, up until three months ago, you had to hire a developer to build all this for you. Now you can just get clickfunnels. And we're going to throw clickfunnels in for free for a year. So the course was 997. You got eight weeks of training. You'd have. There was actually live training. We were doing live training every week for eight weeks. And you would come in, you'd watch the live training, it would tell you how to do all this stuff. Build your offer, build your business from scratch, right? Like, whether you had an idea or not. We even had stuff about. Russell would teach idea, offer creation, like business idea creation, all that kind of stuff too. Product creation. So start from scratch. We solved that problem. We solved the problem of technology with clickfunnels. We solved all these different problems that people had in their head with, like, why they wouldn't use it or couldn't use it. So he goes on stage and I don't remember how big the room was, but I remember specifically that he had sold 45% of the room, which is probably maybe a couple hundred people. You know, he's doing the pitch. This is like one of those events where people run to the back of the room, put their credit card down, like just the table at the back was swarmed with half the room surrounding it. And he comes out afterwards and he's like, I don't know, Todd, if you just realized what happened, but this is it. This is, this is the thing. Like that. I've never seen that happen before. 45% of the room, half the room came back and paid $1,000 on the spot after I got up and spoke for an hour. So he really, like, during that, dialed in the objections that people were having dialed in the offer, dialed in the thing. And then we went on basically a webinar roadshow for the next couple of years of like every week it was doing a webinar which was dialing in that offer that was originally done at that live event. And just Making it better and better and better.

[Omar Khan]

And so. And did you still continue with that same model where people were paying for training and getting, Click Getting the SaaS for free?

[Todd Dickerson]

Yeah. So basically the way it worked and especially after we dialed it in over the next year or so, it was a, it was a course. People were signing up to buy the course originally when they're opting in, they're opting in for a webinar to just learn about funnels, learn about making money money through sales funnels. It's free webinar. And this isn't like a lot of people in our world, the software world at least are thinking like, oh, like a sales webinar. Or maybe they're thinking a training webinar. This is nothing like that. This is what Russell coined as the perfect webinar. This is, the idea is like you come in and you're tackling like three secrets, three major things that you're going to bring in and like cover as you're, as you're talking through the webinar and you're going to take people on a journey, tell them a story, you're going to give them lots of good information. But it's very specifically crafted to actually result in a sell. So we come through and basically build this, build this webinar, sell the course for 1000 bucks, package the software as a bonus for anywhere. We had different price points. We've tested over the years. We did six months of ClickFunnels, a year of ClickFunnels, two years of ClickFunnels. We've like packaged all kinds of different offers over the years. But yeah, you would, you would only be technically buying the course and the software was free. And at the end of the time period, your software went to monthly unless you canceled or decided to do something else. But yeah, that's, that's basically how the offer worked. And I think one of the amazing things about it that a lot of people miss is the webinar. Let's say the opt in happens on a Monday, Tuesday, Wednesday, the webinar is happening on a Friday. So on Friday you collect $1,000 instead of collecting a free trial sign up, which probably isn't going to pay you for a month and then it's going to take you another year to collect the rest of the money from that. So what that enabled us to do is spend a lot of money on advertising. Right. Because if we can come in and if we know I'm going to make up our numbers because I can't remember off the top. But something like $10 a lead that we could actually get, it was probably between 5 and $10. So if you can make 5 to $10 for every lead you get, that enables you. And within a week you're making five to ten dollars, that enables you to buy tons of traffic on Facebook, on Google. Obviously these days there's a lot of other channels that we use, but back then it was a lot of it was Facebook. So if you can dial that in, you got tons of offer, you've got tons of people being able to basically we call it a self liquidating offer. Right. Like we would spend all the money we would collect that first link week on advertising to grow as fast as possible. But a lot of people opt in and they don't buy on the webinar. So if you have even 5, 10% of the people that buy on the webinar, some 90% that didn't, those people are on our email list. Those people are signing up for free trials because maybe they didn't have a thousand dollars they weren't quite ready for. That doesn't mean they don't want to learn from our free information out there, from our books that we now have, from our other education and training. So a lot of the people would come through and actually sign up. So for every 997 webinar sell we would make for this masterclass, we'd sign up at least three different free trials at the same time. And we were able to basically not even consider the advertising cost as a, as a expense for those trials. We just, our goal was always to break even on that webinar at the end of the week. Whatever we spent on advertising, we needed to break even on Friday, Saturday, Sunday as we did replays and the webinar.

[Omar Khan]

What were you selling as this self liquidating offer? Right, because so basically someone is seeing let's say a Facebook ad which is going to drive them to register for this webinar, but you're also making an offer to sell something to them in between there. Right.

[Todd Dickerson]

So yeah, I'm using the phrase self liquidating offer. Most of the time people use that with lower ticket stuff. Our actual funnel hacks webinar was our self liquidating offer. We weren't really converting. I mean we may have tested over the years. I think we had our 108 split test book that we would split test as an upsell. I can't remember how long we did that and what the best offers were off the top. But we have done things where it's like okay, I opted in for the webinar now on the thank you page where it's like cool, here's your date and time add to your calendar. Oh by the way, step one, before the webinar, sign up for your clickfunnels free trial. Cool. Go sign up for that. Step two, buy the 108 split test book and we're going to send it to you and we're going to show you the best split test that we've done over the past three years. Right. Like so we had upsells but they were basically on the thank you page because our main goal was still to get them to the webinar but the secondary goal was to get that free trial because we knew only, you know, 5% of the opt ins are going to buy. But we've got potentially 15, 20% that will actually give us their email address for, well, email and credit card for a free trial. Which it's actually important. Like we do paid, paid trials. We make your card be verified before we actually sign you up for a trial.

[Omar Khan]

Got it. So most SaaS companies would run some kind of ad campaign and it would take people directly to the signup page and say sign up for a trial. And either people sign up or they abandon and that's it. So what I'm hearing what you guys did is you're running these ad campaigns. You get people to sign up for the webinar on the thank you page. Often you're testing stuff to sell these smaller things like the split test thing that they can buy for 10, 20 bucks or whatever. And every time somebody's doing that, you're basically recouping the cost of acquiring that lead in the first place. And you're giving, you're inviting them to start the trial with clickfunnels. But it doesn't stop there because now they're still scheduled in something to their calendar. They're going to turn up for this webinar, they're going to get some value from it. Some are going to buy this course and get ClickFunnels and the 90% that don't are still on the email list and you can still invite them afterwards. So you're getting like, as you said, like multiple shots at getting them onto a trial and you're like generating a bunch of revenue to cover all your advertising costs before anyone's paid like a dollar for ClickFunnels. It's like, why don't more companies try stuff like this? I mean maybe they're, I just don't see it.

[Todd Dickerson]

No, I mean we get like, we've had to, we've had VCs and PS over the years. Like kind of ask that same question. So like wait, I don't get it. Like so you don't spend, you don't need any money? We're like, no. I mean we, we drive ads and we break even on it. Like that's always my goal on any, any campaigns we do. Like what we're basically talking about right now is what we call a webinar funnel. Russell's called them the most incredible free gift ever offer mifke funnels because you're basically like, cool. We're liquidating on this. But then we also have these other free gifts. So maybe you'll give away books or something. But yeah, we'll do that. We'll do Russell's book Traffic Secrets,.com Secrets, Expert Secrets. He's got a series of books that we've done over the years. Those books are different type of funnel that we do for that. Like most people when they. We literally give the book away, right? Give it away free plus shipping. So you pay $7 shipping. Kind of covers our cost of the shipping and the hard cost on the book mostly. So we end up doing free plus shipping books. But we actually make about $40 for every book we give away. Right. Because we do upsells. Right. So we've got the audiobook version we're going to sell you. We've got a course that is the follow up to it we're going to sell you. And then we don't consider this usually in our advertising cost. We also are telling people about clickfunnels at the same time. So we're able to have funnels and ads that are promoting books that also promote clickfunnels that are promoting a webinar that also promote clickfunnels. We got all kinds of different funnels. Like we practice what we preach, right? Like that's why we are bootstrapped. Like we haven't needed to raise we. Who knows, maybe we could one day but we have no, no need for it right now. We just do our, do our funnels and break even on the funnels. Hopefully make some money on them and then we shift people over into clickfunnels for a backend. There's a saying Dan Kennedy does which hopefully I don't butcher it, but it's whoever has the last back end wins, right? Like it's like you want to keep layering these things on. If we're competing with someone who's just building a piece of software and trying to sell it for the same price and doesn't have all these other layers. I mean, we didn't talk about the coaching program. We have a coaching and consulting program on the back end too. That is a higher ascension model. We have our live event that we make revenue from. Right. Like we have all these other layers of business that we stack on and that's how we're able to really dominate as opposed to. If you're just thinking, I'm going to write a book and it's going to be successful, like, cool, hopefully. But if you want to compete with me on advertising, like, you're going to need more than just that book. You're going to need a bigger business built around it. Yeah, that's. That's kind of the strategy.

[Omar Khan]

And to clarify, when you talk about backend and Dan's quote, we're talking about back end offers to sell stuff, not Ruby on Rails backends.

[Todd Dickerson]

Right. So it's good point. Right. Remember the audience, right? Like the engineers here are thinking like, wait, what? Backend? Yeah. No back ends to sell something. Right. So like, I've got the book, I've got click funnels, I've got a coaching program. Like, like if you just had the book and you don't have clickfunnels and then you don't have. You just got clickfunnels, but you don't have a coaching program. Right. Like, there's different layers that allow me to spend way more on advertising than somebody that just has one of those layers.

[Omar Khan]

Yeah. So great. So once you've got this model going and you're basically recouping the cost of advertising and so basically you can just keep running these ads and these webinars and basically that's what you were doing. It's also interesting that you told me that for years, like a lot of people would if they tried doing webinars, they try to get to like automated webinars as soon as possible. And it was interesting. You told me that, like, Russell was like actually doing each webinar every week for years right. Before you automated this stuff.

[Todd Dickerson]

I think Russell and I agree on this. That's one of the biggest mistakes people make with webinars. They do it once, maybe twice. They record the thing and then they just play it on replay. Every time you do it, you interact with people in the chat, you get better. Like, you audition, you learn the objections, you improve the offer. Like you need to be dialing it in. I, Russell I think he said like 50 times, you should do the webinar before you ever go into automated. Something like that. If you haven't done it at least a dozen times, like, don't even consider automating it yet. Have it so dialed in that you're like, this is so good. I don't think there's anything I should change on it. Like, that was great. Like, I can't do better than that. Now you can consider rolling it into an automated. And I'm not saying you shouldn't automate. Like, we have automated webinars all over the place now, but we don't just record once and then turn it into automated.

[Omar Khan]

Yeah, I think that's so smart. And in fact, we do something similar with SaaS founders. In my community, we have kind of coined this term where we talk about like the anti PLG strategy because everyone wants to do product LED growth and wants to put this stuff in where it's self serve. And I don't want to talk to customers and you know, they're just going to do this. But the thing is, when you're in the early stages, when you're trying to get the first 10, first hundred customers, trying to get to the first million in ARR, you need to talk to those customers. Right. And so when we say anti plg, we're like, hey, instead of automating it, make them fill out a form where they have to request access and you have to schedule a call with them. So you get to talk to these people and figure out what questions they have, what objections they have. Right. Because that's like so super valuable. But doing it for years, week after week, man, that takes some stamina.

[Todd Dickerson]

It's like it does he only I think he would keep doing it if he hadn't got to the point where he was so overwhelmed that he's like, all right, we're going to have to automate this stuff eventually. But yeah, no, I mean, there's great tools that automate it and it makes a lot of room for not making errors too. Right. Like, once you kind of dial that thing in, it can be great.

[Omar Khan]

Yeah. Let's talk about growing pains. So you, you know, once you guys got this webinar kind of dialed in and sales coming in, the business starts growing. People are starting to not only use clickfunnels, they're relying on clickfunnels to run their business, to make money, to make a living. And then you guys have this massive outage. What happened?

[Todd Dickerson]

Yeah, absolutely. So, yeah, I'm kind of jealous of people now that don't have platforms that people are like relying on to run things on one side. It's great to be core to their business, but also if you're core to their business and you have any type of hiccup whatsoever, you're going to hear about it and people aren't going to be happy. So, yeah, our first major crisis and really the biggest outage we've ever had. Basically I told Russell when we were launching this thing and kind of seeing how users were using it and usage patterns and stuff, I'm like, okay, we can probably handle around 10,000 of these big users that are doing stuff on the platform, like they're using it and driving traffic and whatever. It seems like we probably handle about 10,000. And right around when we got to 10,000 users, we basically. Russell was flying on a plane to London to speak at an event. I think it was a maybe coaching or Internet marketing event. Sorry. So he was flying out to London to land on this thing and I had a horrible surprise at 4am, basically our entire app had gone down and our database had disappeared from our database host. Yeah, not, not like, like down, just it wasn't there. It wasn't like no longer there. And clearly, like, obviously we got off this database host as fast as possible after the fact. But I'm in panic mode, right? Like, I'm reaching out to them, talking to them. They're like, oh, yeah, we're not sure where it went, we're not sure what happened to it. I'm like, what do you mean you're not sure what happened to it? How could it just disappear? And they're like, well, we have the backups, we'll start restoring. So they start restoring the process. And I'm like, how long is this going to be? And they're like, well, you know, it should be later today or something. Like, what is happening? So luckily we were running our own backups as well. And I'd been wanting to migrate to Amazon Aurora at the time. It was relatively new at the time, but it was like, clearly seemed like this should be where we should be hosting our databases. So I brought in a database engineer that we had on contract and brought him over and him and I just started hacking away at like, how do we get this backup live on Aurora as fast as possible? And clearly our database was not small at the time, right? So we're basically racing against the clock trying to get our databases online, our main database online, actually. So eventually we get this thing back online on Aurora and get running. And we're like, oh, sweet. We got 10 times faster than we were. Like, everything's just way better. But by the time that was all done, we've been down for eight hours.

[Omar Khan]

And that's huge right in the middle of the day for most people. People were really pissed about this, right? And they were very vocal, which is the last thing you need when you're trying to build a reputation as being this. This. This product to run your business on.

[Todd Dickerson]

Yeah, absolutely. That was literally the pitch. And like I was saying, like, we were trying to convince these people, like, this is. You can trust us. Like, you're the. We're the place you should be running your business, running your leads and all this. This is like the worst possible thing that can happen. Right. Russell said when he landed in London, obviously he's much more the public face of the company than I am. He landed in London, he had guys that literally, like before he took off in Boise, we're texting him about how amazing he was and how great clickfunnels was who are now texting him, like, death threats as he landed. And he's like, that's how he found out we were down. He saw those before. He saw my messages that we were down. He saw death, like, people being like, I, you owe me $50,000 for my Facebook ads that were running and my site went down. You know, like, just that kind of stuff. Just like complete death threat type stuff. And he's like, I have no idea what's going on. I need to talk to Todd as fast as possible. Right. So. So, yeah, like, that. It was. It was. It was a nightmare. Yeah, it was not fun.

[Omar Khan]

You guys kind of turned that around because obviously, you know, you. You were scrambling and you not only restored the service, but also found a more reliable place to host your database. But just talk through what Russell did as well, in terms of going on Facebook.

[Todd Dickerson]

Yeah, definitely. I mean, I'm in full, no sleep panic mode trying to figure out how to get this thing back online. But Russell stepped up completely, and it was just a matter of, like, what do we do? Do we do, like, obviously your instincts are, I want to hide, and I want to hide behind the computer and try and just, like, fix this thing. But he had the correct instinct that he needed to go live on Facebook. We didn't make a prerecorded video. We didn't call in a video production crew. Like, we didn't script something like some PR announcement. He was like, I'm going to go live on Facebook right now and talk to people, right, and tell them what's up. And that's what he did. He jumped on Facebook, pulled out his phone in London. He's like, hey, guys, I'm sorry, this is not acceptable. It's not acceptable to us. It's not acceptable to our engineers. It's not acceptable for you. Like, we are completely doing everything we can to try and resolve this, but we understand what you're going through. Like, we understand how bad this looks, how bad this is. And really the reaction from the community was just support. It completely flipped everyone around who was. Who was in panic mode and freak out mode. They're like, oh, oh, you are on top of this. Like, you do actually care. You are a real person. You are a real business. You're trying to resolve this issue. He just made it crystal clear, was vulnerable and open and just told them how things were. And the crazy part is, which I'm sitting here like, we're done. We're going to lose half our customers. Everyone's quitting. I'm in panic mode. And he's like, I don't know. People seem to be, like, responsive and understanding. Like, all right, we'll see. So we look at the data like a day or two later. No dip in customers. Like, there was no, like, no new signups because we were down, but no dip in actual customers. Everyone that was on the platform stuck with us, went through it, and, yeah, we came out stronger on the other side.

[Omar Khan]

What was the size of the business then? Like, you.

[Todd Dickerson]

We had 10,000 users. Like, it was right at that number. Because I remember that being, like, the part where I was like, I think we might be in trouble with our database at 10,000, and then didn't anticipate it disappearing. But that was. I won't throw that vendor under the bus. They're still out there, but I don't think many people use them. But, yeah, so it was probably 10,000 users. It might have been 25 employees, mostly customer support. Engineering wise, it was me, two other engineers that were full time and maybe two contractors that were mostly full time. So we're talking like five engineers with 10,000 customers that are paying customers.

[Omar Khan]

I know you had a bunch of other growing pains as well. As the team grew and got bigger and so on, we could talk about this stuff for hours. But I think we should leave it there and try to wrap up.

[Todd Dickerson]

It's been fun.

[Omar Khan]

Before we get into the lightning round, just one, one final question. You guys have done so well with growing. Basically, you know, A nine figure ARR SaaS business in a very unconventional way. I'm sure that's attracted a lot of copycats, a lot of people trying to get some of the action. How has that changed the way you guys think about the business? Like how much time do you spend thinking about competition? How is the product evolving? Where are you going next?

[Todd Dickerson]

Yeah, I definitely, I mean I'm constantly staying involved in as much as I can with how people are making money online. Right. Like whether it's E commerce, shopify, community stuff like course creation stuff, I'm staying in it all the time. But a big move that we did make with the new platform. When I was setting out to actually build this thing, I basically set down the ground rules that like I don't know what I don't know, right? Going back to that original quote, like that's how I think about stuff. But what I do know is like things are going to change, the economy is going to change, the industry is going to change, the landscape is going to change and I need to build a platform that allows me to quickly build the new thing that allows our users to be successful. And that's what we've done, right? Whether it's been building E commerce stuff to be able to do an E commerce store on the platform or run an entire private community courses, membership stuff, all of this is now apps inside of it. You can do full automation workflows like anything I see that our users are needing and going out and having to get third parties that they pay three times the price of our software for alone. I'm basically going out and being able to build those into our platform or at least the core value proposition that I see our users needing out of them. So yeah, that's been my big focus honestly after the over the past four years is just keeping an eye on what's changing, what the customer needs, talking to them, finding out what we can do to make our platform be the place that runs their business.

[Omar Khan]

And we should just clarify that you did earlier you mentioned talking to VCs but those were just conversations. You guys haven't raised any money from investors. It's a self funded business. How much did you guys start with? How much did you put into this business to start?

[Todd Dickerson]

Yeah, we literally only put in, I think it was 15 grand Russell put in from his previous business to have a explainer video made. Not for engineering, not for like building stuff or nothing. It was just to have like a promotional video on the homepage. Like that was the only thing we actually Capitalized on the business. Other than that, it was like sweat equity. Myself, Russell, Dylan, co founders. Just the three of us just jumping in and making it happen. Yeah.

[Omar Khan]

And it all happened because of that one random email that you chose to reply to and help out.

[Todd Dickerson]

It did. It did. Works in mysterious ways, right?

[Omar Khan]

It does, yeah. All right, let's wrap up. Let's get into the lightning round. So I've got seven quick fire questions for you. Ready?

[Todd Dickerson]

Yeah.

[Omar Khan]

What's one of the best pieces of business advice you've received?

[Todd Dickerson]

One of the best pieces of business advice was to find a level 10 opportunity. We had someone in the early days before we came up with clickfunnels. Russell and I were talking to the guy and he basically was like, you guys are like level 10 marketers in a level 2 opportunity right now. And it really, like, struck both of us. And we both talked about that for years later. And when we found ClickFunnels and the idea, we were like, this is the level 10, like, level 10 opportunity.

[Omar Khan]

What book would you recommend to our audience and why?

[Todd Dickerson]

I think a must read is the classic Think and Grow Rich. It really just lays foundational mindset that everyone has to have. I advise anyone that asks me any question, like, if you haven't read Think and Grow Rich, go read that. Then we'll talk about later stuff. Recently, one of my favorite books was Buy Back youk Time. Dan Martell, one of my coaches.

[Omar Khan]

What's one attribute or characteristic in your mind of a successful founder?

[Todd Dickerson]

I think stubborn persistence. Just not listening to the haters and just knowing and sticking to your vision and sticking to your dream and doing it. Um, like, you have to be what other people consider stubborn in order to be successful, I think. In. In this game.

[Omar Khan]

What's your favorite personal productivity tool or habit?

[Todd Dickerson]

Yeah, I think the habit would be waking up early and working out, like, taking care of myself a little bit before the kids are up, the wife's up, everyone's running. Like, there's a saying, the lion eats first. Right. Like, you, you need to get up and take care of yourself a little bit before. Before the world starts. I'm not saying you gotta spend four hours doing a morning routine, but something to take care of yourself in the morning.

[Omar Khan]

What's the new or crazy business idea you'd love to pursue if you had the time?

[Todd Dickerson]

Man, I'm kind of doing it all the time with ClickFunnels right now because of the way we did the platform thing. Right. Being able to add new things into clickfunnels. Is the crazy opportunity. So I've always got new stuff. We're working on AI funnel builders, which are fun, like trying to automate as much as possible for people. So that, that's really. I want more time to work on that piece and hopefully you'll see me in a year or two from now and I've had more time to work on it. But I think there's a lot of stuff we're going to be able to automate with AI just to help people get started easier.

[Omar Khan]

What's an interesting or fun fact about you that most people don't know?

[Todd Dickerson]

Yeah, I don't talk about this one that often, but I actually am pretty good at League of Legends, like the computer games.

[Omar Khan]

So there you go, you're a nerd after our own hearts. Yep. And finally, what's one of your most important passions outside of your work?

[Todd Dickerson]

I'd say fitness and health. Like, I make sure I work out at least a few times a week, eat the right stuff, healthy, supplements, the whole thing. I kind of obsess a little bit too much over it maybe, but just after I turned 40, I like kind of the abuse that I used to take in my 20s, like, hurts a little bit more now and I kind of. I kind of want to get back a little bit like I used to be able to handle.

[Omar Khan]

Awesome. Todd, thank you so much for joining me. It's been pleasure. I loved just unpacking the story. I think it's a great story. Lots of great lessons here in terms of how you guys have gone and built this business. And hopefully we've given, you know, people some inspiration, some ideas that they can go and take away. If people want to check out ClickFunnels, go to ClickFunnels.com and if folks want to get in touch with you, what's the best way for them to do that?

[Todd Dickerson]

Probably on LinkedIn, actually, if you go to LinkedIn. Todd Dickerson.

[Omar Khan]

Great. We'll include a link to your profile in the show notes. Awesome, man. Thanks so much. It's been a pleasure and wish you and the team the best of success and let's get you back sometime and we'll continue the conversation and see where ClickFunnels is in a year's time or whatever.

[Todd Dickerson]

Yeah, absolutely. I look forward to it, man. Thanks for having me.

[Omar Khan]

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