Nico Perez, Mixcloud // Living In A Warehouse & Bootstrapping To 17M Users
Aug 18, 2016
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Nico Perez, Co-founder of Mixcloud, shares how they bootstrapped to 17M users without outside investment. Topics include living in a warehouse, getting rejected by investors, finding a technical co-founder, building an advisory board, and more.
Bootstrapping to 17M users without external investment showcases Mixcloud's sustainable growth strategy.
Turning investor rejections into positive momentum helped Mixcloud become revenue generating early on.
Finding a technical co-founder through skill-sharing underscores the value of fostering genuine relationships in startups.
Establishing fair equity distribution based on individual risk and contributions is crucial for startup success.
Deep dives
Building a Unique Internet Radio Platform
Mixcloud, a leading music platform with 17 million unique visitors a month, was founded by four co-founders. The platform stands out for its focus on long-form audio and human curation, catering to radio presenters, DJs, and podcasters. Mixcloud's success without external investment emphasizes the efficacy of bootstrapping and carefully managing costs. Diverse revenue streams include brand partnerships, display advertising, and affiliate sales through Juno.
Growing and Monetizing the Platform
Mixcloud's growth strategy primarily leverages product optimization, intuitive user experiences, and social integrations. The platform's user base reached into the hundreds of thousands before monetization efforts began, focusing on display ads, brand partnerships, and affiliate revenue. The company avoided spending on traditional advertising, prioritizing smart product enhancements and strategic brand collaborations to drive revenue.
Navigating Resource Constraints
Operating with a lean team of 12 employees, including 6 engineers, Mixcloud efficiently manages user comments and community engagement through community monitoring tools. Leveraging Django experiments for A/B testing and social network integrations spurred growth and retention. The platform's organic growth path and resourceful approach underscore the value of sustainable business practices amid industry trends.
Strategic Growth and Potential Funding
Mixcloud's success highlights sustainable growth principles, emphasizing revenue generation and practical business strategies over rapid but unsustainable expansion. Positioned for the next growth phase, the company explores potential fundraising to accelerate market penetration and product enhancement. By prioritizing revenue models and user-centric innovations, Mixcloud aims to maintain its unique position in the competitive music platform landscape.
Startup Efficiency and Decision-Making
The podcast episode discusses the efficiency and decision-making process of a startup, emphasizing how smaller teams can often execute tasks quickly compared to larger teams. The conversation highlights the book 'The Mythical Man-Month' which delves into the concept that adding more people to a project doesn't always result in quicker solutions, as it can lead to complexities that hinder progress. The importance of staying nimble and efficient while also emphasizing the advantages of being a small team is a key takeaway from the discussion.
Finding Talented Technical Co-Founders
The episode delves into the challenges faced by individuals seeking technical co-founders for their startups, cautioning against solely searching for technical expertise without fostering genuine relationships or skill-sharing. It recommends a skill-swap approach where individuals collaborate and contribute skills beyond just ideas to create a fair and balanced partnership. The discussion underscores the value of bringing more than just ideas to the table in entrepreneurship and emphasizes the importance of building strong relationships before expecting technical expertise.
Equity Distribution and Decision-Making Dynamics
The podcast episode explores the process of determining fair equity distribution among co-founders in a startup, pointing out the significance of assessing individual risk, commitment, and contributions to establish equitable ownership percentages. It highlights the trade-off between risk and reward, where early team members who take higher risks may receive more significant ownership stakes. Moreover, the conversation sheds light on unique decision-making structures within startups, such as having a triumvirate of founders rather than the traditional CEO-led hierarchy, allowing for efficient conflict resolution and diverse perspectives.
Nico Perez and the Mixcloud team have managed to get to 17M monthly visitors with zero outside investment. We talk about how they bootstrapped their way to a unique and profitable business. Listen out for when they lived in a 60k square foot warehouse.
We go deep in this conversation, so 5 things to listen out for:
1) Living in a warehouse and having no internet connection – many people say they “had no money” when they started, but Mixcloud really had to live that mantra when they failed to raise any investment. We go into how they paid their rent every month with limited income after Nico quit his job to go full time.
2) Getting rejected by Y Combinator and other investors – how they turned that into positive momentum and became revenue generating early on.
3) How he found a technical co-founder – in today’s digital world, a common question that comes up time and time again is “how do I find someone to help me build this” – we go into how Nico approached this problem with a “skill share”.
4) How they got the head of growth at Facebook to be on their advisory board – Building a great team isn’t just about the employees and founders of an organization. There are mentors, board members and in many cases: “advisory boards”. Nico tells us how they organically made relationships to convince smart people to be a part of their advisory board.
5) Other Topics – We had a free-flowing discussion with a few other topics we touched on: getting more women on their advisory board, artificial intelligence, building an MVP (minimum viable product), splitting up equity amongst co-founders, benefits of having 3 co-founders, books that have impacted him & what success means to him
