EP 528: ConvertKit Hits $480k MRR, Helping 10,000 Professional Bloggers Grow Email Lists with CEO Nathan Barry

Nathan Barry, CEO of ConvertKit – an email marketing company for professional bloggers. Listen as Nathan shares how he manages to stay self-funded while, at the same time, increasing the growth and bloggers' interest in using ConvertKit.

Famous Five:

• Favorite Book? – Predictable Success
• What CEO do you follow? – N/A

• Favorite online tool? — Workable
• Do you get 8 hours of sleep?— No
• If you could let your 20-year old self, know one thing, what would it be? – Pick just one thing you love to do and do it really well

Time Stamped Show Notes:

• 01:50 – Nathan introduces Barry to the show
• 02:15 – ConvertKit is a SaaS company and has around 10,000 bloggers
• 02:47 – ConvertKit's pricing depends on the blogger's subscribers count
• 03:04 – Average revenue per user per month
• • 03:24 – 65% of the users are on $48/month plan
• 03:48 – ConvertKit's cash flow is doing well
• 04:15 – Annual plan has a big impact on churn
• 04:50 – Barry pushes the annual plan on Cyber Monday
• • 05:00 – Average annual plan total
• 05:30 – ConvertKit had a free 1 month promotion for new users
• 05:56 – ConvertKit has a 40K email list – half of it is from content marketing, the other half is from webinars
• • 06:30 – ConvertKit has added 25K new people in their list this year from joint webinars alone
  • 06:55 – Barry is using Google Hangout and Chatroll for the webinars
  • 07:20 – ConvertKit is doing 10-20 webinars a month
• 07:53 – There are 2 people in Barry's team who are involved in the webinar process
• • 08:28 – The team is trying to get people who use MailChimp or Aweber to switch to ConvertKit
  • 08:38 – It is a 2-step direct sales process
• 09:54 – Barry shares how he mitigates the show up rate in their webinars
• 10:54 – Some of the bloggers reach out to ConvertKit and some find them through other bloggers
• 11:16 – Average expenses a month in affiliate payouts
• • 11:33 – A quarter of ConvertKit's revenue comes from affiliate programs
• 12:10 – 2015 total revenue is around $300K
• 12:20 – 2016 average revenue
• 12:34 – ConvertKit is self-funded
• • 12:44 – It was an intentional choice
  • 13:03 – Barry shares what he did when they were almost running out of funds
• 14:15 – ConvertKit's gross profit and total money in the bank
• 14:38 – ConvertKit just had a big expense from the annual plan switch
• 15:15 – Gross monthly customer churn
• 16:15 – Expansion is ConvertKit's next focus
• 17:08 – Current CAC
• 18:28 – Team size and location
• 18:50 – Average headcount expenses
• 19:14 – ConvertKit was launched in 2013
• 20:18 – There are two advisers who have a share in the company
• 20:45 – Connect with Nathan through ConvertKit and his website
• 23:20 – The Famous Five

3 Key Points:

• You can stay self-funded with a fast growing business and by managing your funds properly.
• Joint webinars and 2-point direct sales are excellent options to increase mailing list.
• Pick one thing you love to do, focus in, and do it really well.

Resources Mentioned:

• Acuity Scheduling – Nathan uses Acuity to schedule his podcast interviews and appointments
• Drip – Nathan uses Drip's email automation platform and visual campaign builder to build his sales funnel
• Toptal – Nathan found his development team using Toptal for his new business Send Later. He was able to keep 100% equity and didn't have to hire a co-founder due to the quality of Toptal
• Host Gator – The site Nathan uses to buy his domain names and hosting for the cheapest price possible.
• Audible – Nathan uses Audible when he's driving from Austin to San Antonio (1.5-hour drive) to listen to audio books.
• The Top Inbox – The site Nathan uses to schedule emails to be sent later, set reminders in inbox, track opens and follow-up with email sequences
• ConvertKit.com – Barry's business website
• NathanBarry.com – Barry's personal website
• Show Notes provided by Mallard Creatives