How is beehiiv making $15 mil per year? – Business Podcast for Startups

Andrew Warner: [00:00:00] Hey there, Freedom Fighters. My name is Andrew Warner. I’m the founder of Mixergy, where I interview entrepreneurs about how they built their businesses. I partnered up with a buddy of mine, recently, Jesse Poojie, to [00:00:09] help grow his newsletter. And we’re now turning it into a business that we both co own.

And the thing is, I thought newsletters were dead. I’m watching Jesse and me, and I’m [00:00:18] doing it myself, actually. We’re building the newsletter together. It’s called Bootstrap Giants. And I realize, newsletters are not dead. They’re so frickin exciting because I’m [00:00:27] begging people on, on Twitter right now. To interact with me and I’m hardly getting any responses.

I do appreciate them for people like Dylan and [00:00:36] M uh, Emmerich and Sparsh and others, but man, when I sent out an email newsletter and I asked for feedback and I asked for somebody to get on a sales call with me or [00:00:45] whatever the freaking people respond right away. And so as much as I think email is dead, I have to acknowledge email is g I’m wrong.

Email is

Tyler Denk: growing. Another [00:00:54] threat too, right? I’ve also noticed on Twitter and other channels that when I used to post, the level of engagement that I used to get relative today is way down. Um, [00:01:03] so it could be more of like a broader ecosystem change, but Not, not, uh, poopoo the important email. I totally agree.

And I mean, in my, in my email [00:01:12] newsletter, I have an AI generated office space and I literally ask people to generate one and send it to me so I can feature them. And I get dozens. So I think it’s like actually just like taking a step back [00:01:21] away. It’s like. Three steps removed from what the purpose of my newsletter actually is.

But the fact that I wake up on Tuesdays, two dozens of AI generated desk and office images [00:01:30] from random strangers on the internet, I think shows you the power of email and how well it works.

Andrew Warner: So I’m building this up. I sent out an email to the Mixergy list and to the [00:01:39] Bootstrap Giants list. I think we’re going to send it out soon, giving them an update on where we are business wise.

The newsletter. In about six weeks did a quarter million dollars in our first [00:01:48] sale experiment. And so that’s exciting. And so the reason that I’ve got you on here, you’re Tyler Denk. You’re the person who was, I think the second higher at morning brew, which had a huge [00:01:57] exit in the newsletter space. You then went on to create beehive where you took a lot of the tools that you figured out, the growth tools that you figured out at morning brew, and you made them accessible to others.

We [00:02:06] use you at, um, at, uh, bootstrap giants. I want to know two things. First, how do we get even frickin bigger? I want to build this newsletter as big as it possibly can. If we’re building on your [00:02:15] platform, you must know some things that we could do to get bigger. And then the second thing is, how the hell are you doing so well in a market that I thought was so crowded with other players?

And I could list them, but [00:02:24] we all know them. So, actually, I’m gonna list them. ConvertKit, Infusionsoft, which, which I hate. Um, sub stack, which everyone

Tyler Denk: talks, uh, [00:02:33] sorry. I’ve never even heard of the second one, but carry on. You can go for probably another five minutes if you wanted to name it. Yeah. And still you’re doing well.

Okay. Let’s get into it. That’s the goal for the session. Yes. [00:02:42] There’s, there’s dozens and some of them have been around since 2001, 2002. Um, the, the huge success in the space was probably MailChimp, which sold into it for [00:02:51] 13 billion. So that’s kind of like, again, when I was going out and raising capital. You kind of want to tell investors, investors, just like big numbers.

Right? So it’s like, here’s what it could [00:03:00] be. If we do the right things, prioritize the right tools, have the right success, like MailChimp prove that email is a profitable business and it sold for 13 billion, [00:03:09] I actually think what we’re building at beehive is far more powerful than what MailChimp built. I mean, we can like get in Why?

Why could you

Andrew Warner: be Why could you be worth more than [00:03:18] MailChimp?

Tyler Denk: Yeah, for I think for a lot of reasons. One, I think MailChimp for a lot of One, it is stuck in the 2010s. It is Yeah, everything from the software to the [00:03:27] interface to the features to like now how they’re sucking you into the Intuit ecosystem.

Like, it doesn’t serve the core purpose of just sending emails, understanding data. The [00:03:36] differentiating factor for us and why I think what we’re building is so interesting is MailChimp for dozens of businesses, content creators, whatever, is a cost of doing business. [00:03:45] So they have to pay 500, 600 per month to send emails to their audience.

Where I think what we’re doing flips that on its head is we have monetization tools [00:03:54] between boosts, between subscriptions, between the ad network, where our goal is you’re actually generating more revenue to take home using our platform than you are paying us. So if we [00:04:03] are charging you hypothetically five, 600 a month, but you’re bringing home two, 3, 000 from sponsorships through our platform, one from where we sit, that’s [00:04:12] incredibly sticky as a SaaS platform.

Two, it’s extremely more powerful because we are empowering our users to generate revenue, which they can then turn into acquisition and [00:04:21] growing the newsletter. And then now they are, have a larger audience. They’re making more money. They have more influence. They’re using more of our growth tools and automation tools.

And so I think [00:04:30] fundamentally we are just trying to implement like a Facebook ad marketplace on top of email newsletters. And I think the addressable TAM and opportunity there is much [00:04:39] bigger than what MailChimp went after.

Andrew Warner: But, but MailChimp is being used by every mom and pop, but my kid’s music school is using MailChimp and they’ve got some kind of subscription there.

They’re not going [00:04:48] to monetize that, they’re just going to stick with whatever they’ve got. What have I heard on NPR?

Tyler Denk: Which I also view as an opportunity, right? For, for us to be able to serve [00:04:57] mom and pop, to be able to track sales, to be able to track volume of purchases, to be able to have your middle school also send their distribution via [00:05:06] us.

That’s like, I think actually one of the hardest parts of my job and what we do is There’s like the creator economy and there’s being able to empower growing and monetizing your [00:05:15] audience. But there’s also just people who want to send to their, their kids school and, or a rec league and just send communications via [00:05:24] email.

And it is a difficult balance to do like the product marketing. Well, to say that we can do that just as well, if not better, uh, without cornering ourselves just into like this [00:05:33] small creator economy market. Um, but that, that is the opportunity. I think we can serve mom and pop just as well.

Andrew Warner: Let’s go back a little bit just to understand how you got here and then [00:05:42] we’ll talk about what you’re building and how you’re able to build it and then, uh, and then give me some tips on how to do better with our newsletter and how our audience can do better.

Do you [00:05:51] remember when Morning Bruce sold and you got some kind of payoff or pay day or What’s the word? What do you [00:06:00] feel about that day? Earnout, maybe? Earnout. Yeah, tell me about the day.

Tyler Denk: Yeah, funny because like totally unexpected. I spent [00:06:09] three and a half years at Morning Brew. You already mentioned I was the second employee there.

I did a lot of product engineering and growth. Like one of the best experiences, right? I came in. Knowing nothing about [00:06:18] emails and knowing nothing about newsletters, honestly, self taught software developer knew nothing about building tech and Austin and Alex kind of saw like a hustle in me [00:06:27] and gave me very few constraints.

They said, this is the goal. It’s to grow the newsletter as quickly as possible. We want to have a referral program. We want like a [00:06:36] nice website. We want to have a newsletter that looks good in the inbox. And like outside of that, like build that ecosystem and help us grow and like nothing else. And so for me, it was [00:06:45] just taking calls with people at the skim, taking calls with different email platforms, just literally just being a student and trying to learn how I can hit these [00:06:54] aggressive milestones and goals for morning brew without being told what to do.

Um, so a lot of failing, a lot of trying things, a lot of things that worked really well, and we went from a hundred [00:07:03] thousand subscribers, the three and a half million in about three years while I was there. And towards the end of that three and a half years, like we, we were good. Like we, we were making like 20 [00:07:12] million in revenue a year.

I had built out an engineering team. And for me personally, the, the white space of I can do anything without [00:07:21] rules was becoming a bit more restricted as like, okay, we have like the foundation set now we’re just like improving the website a bit. So me and like the entrepreneurial spirit kind of got a [00:07:30] bit bored, I guess, as a way, or like wanted to move on to something else.

So I left Morning Brew after three and a half years and like, maybe not the best terms. And I say [00:07:39] that because Morning Brew doing super well, they were secretly, I mean, I didn’t know that they were in conversations about an acquisition. And so [00:07:48] here I am as like a person who built this team and this function kind of piecing out at like a very critical time.

And like, I’m friendly with Austin and Alex, both are investors in Beehive. So kind [00:07:57] of like ruffled some feathers, I’d say. And so kind of went off to Google in the meantime. And fast forward two weeks after leaving, I wake up to like tons of congratulatory [00:08:06] texts on like a Wednesday morning in Brooklyn.

And everyone’s like, dude, that’s amazing. Congrats. Like, I can’t believe it happened. Alex and Austin never told me that they were selling the company. I had no [00:08:15] idea that it was coming whatsoever. And I just wake up to a bunch of congratulatory text. And then you like start quickly doing math, like how many shares did I leave on the table?

How many shares vested? [00:08:24] Like what did, what was the acquisition price? There’s like articles going out that are saying one number. You’re hearing other numbers. Like I, I’m not getting it from the source. Cause I kind of already ruffled a few [00:08:33] feathers. Like not in like the best terms with everyone. I just left at the company.

Um, but like called my mom. I wake up at like five 30 in the morning, called my mom at like 6. I am like [00:08:42] pretty fired up being like, I think that all of the stress and gray hairs that I got from the past three and a half years of trying to build this thing. Paid off to something. I don’t know what that something is yet, but [00:08:51] more money than I had yesterday.

So what did it end up being? Come on, tell us what the number was. So it’s around a mil. So like good, good start for, [00:09:00] for being 26 at the time and putting my head down and building something. But it’s also a huge wake up call for me and the difference between [00:09:09] founder money and early employee money. Um, so

Andrew Warner: if you were a co founder in the business, you would have done well, [00:09:18] they didn’t say publicly how much they, what their share of the exit was, right?

Tyler Denk: Yeah, I think it’s pretty common in [00:09:27] most startups where like everyone knows the founders get like, they took the risk, they built everything, they built out the foundation, they have their entire [00:09:36] livelihood tied up in this thing. And I think it’s like a known acceptance that like the founders have most of the equity and that’s totally fine.

Um, and like, everything’s just numbers on a piece of paper. Everything’s [00:09:45] just a percentage until like it actually happens. And then when dollars come through, you’re like, I worked really fucking hard. And the difference between Did you get anything for yourself? Did you at least [00:09:54] celebrate by getting something?

I moved to LA, which is like kind of what I’ve always wanted to do. That wasn’t because of the acquisition, but starting a business, not having to go in office with COVID being like my [00:10:03] own founder. Like I moved to LA and then I bought a nice Tesla, which is like kind of always, I’ve always assumed moving to LA and having like a nice Tesla for whatever reason, since I was, I don’t know, 10, [00:10:12] 15 years ago was like the goal.

Um, so I treated myself to that, and yeah. Oh yeah.

Andrew Warner: Alright, why’d you end up, by the way, at Google? Like, I could understand you [00:10:21] leaving Morning Brew to start Beehive right away, but that time at Google, what were you doing there?

Tyler Denk: Yeah, so I’d say after about the three, three and a [00:10:30] half year mark at Morning Brew when I kind of was exploring different options.

I was just putting feelers out. Funny enough. I talked to like a lot of these, like I taught, I was, I interviewed [00:10:39] at ramp and didn’t get the job. Um, but like they were at 20 employees at the time. So like, would have been cool opportunity, but also wouldn’t be doing what I’m doing now. So like, [00:10:48] thankful that I didn’t get that job, um, applied to like, I was really interested in FinTech.

It was like 2020. Everyone was interested in FinTech. It was like Pete crypto FinTech, all these [00:10:57] companies are like just printing billions or at least in, in valuation. And then my roommate worked at Google. I’m huge into music. I have the Spotify playlist, [00:11:06] big desk energy, shout out. Um, and he was like, yo, there’s an opening at YouTube music.

Do you want to do that? And from like a career [00:11:15] trajectory standpoint, which is where I was, it was, I saw morning brew from three people to 35 people from like, you [00:11:24] know, a hundred thousand in revenue to 20 million in revenue. So I kind of had like that early startup experience. But I was totally winging it.

I like, when I was doing product at Morning Brew, I didn’t even know what [00:11:33] product was. I was just like kind of combining marketing and growth and engineering and like pulling it all together. Um, so I had like the scrappy zero to one experience. And [00:11:42] Google was like the super polished, like, this is how you do product management.

This is how you do a proper, like, It’s like a finishing school for you. It was [00:11:51] like, I’m filling gaps of like, this is what I kind of figured out to be like, very scrappy. Granted, I knew going into it, I wasn’t going to love it. I’m such a scrappy, like, hustle, startup type person, [00:12:00] through and through. But, there was something about, like, the stamp of approval, like, seeing how the behemoth of, like, a Google worked from the inside.

Yeah. Also just being into, like, [00:12:09] tech and startups, like, There’s only a handful of companies where it’s like the ones who completely have innovated and changed everything over the past few decades. And Google being one of them was like a [00:12:18] really cool opportunity. And I did learn a lot. I was only there for 10 months, but it was an opportunity to like a lot of the processes in terms of here’s what I want to build.[00:12:27]

This is how you do a product requirement document. You toss it to the engineers. You have an engineer who leads it, scopes out on the technical side. You get design, you pass it off and then you kick off the [00:12:36] project. Like that’s something I’ve never done at Morning Brew because we were just winging it like the wild West.

And like that process got refined at Google and it slimmed down a bit with a bit less bureaucracy [00:12:45] at, at Beehive and actual learning and just to kind of seeing how the sausage was made was like a very cool experience.

Andrew Warner: You know, Tyler, one of your [00:12:54] investors, Sean Porey, he once said on the, on his podcast that he had asked someone who is an entrepreneur he respected if he can come and shadow him because he wanted to [00:13:03] learn how others build their businesses.

I totally get that. I’ve seen people in my inbox who look for opportunities like that. I wish it was something that was more formal. Where we could say, [00:13:12] we’re going to do a month stint at another company. We go in, we see how they run. We see how they lead. We see how they talk to people. We see how they don’t show up when they’re not [00:13:21] feeling good or whatever it is, the little things like when to show up and how, how you show up day to day to the big things, like how do you structure a process that involves [00:13:30] getting feedback from customers?

Sending it to the right people on the team, creating pro, anyway, all that stuff would have been fantastic

Tyler Denk: for, for me to see it. I wish you’d say that. [00:13:39] Again, I have to give a plug to my, to my newsletter, Big Desk Energy, but that is kind of the purpose of why I write and build in public and share what I do.

I think it’s super, [00:13:48] that’s the information that I wish I had of how did a founder get from 10 million ARR to a hundred million ARR? Like, how do they hire? How do they deal with like bad hires? How do they [00:13:57] format their days and structure their days and everything else? And I think one, like most founders are rightfully too busy or like, just don’t have like the creator [00:14:06] mindset to think like, this is an interesting insight that I’ve learned.

Let me share it with the world. Or, you know, startups are so competitive and just being a founder, you feel like [00:14:15] everything is so fragile, like even at this scale, we’re doing 15 million in revenue this year. I feel like we’re one step away from like everything falling apart. Cause I’ve seen it when you were making a thousand [00:14:24] dollars a year.

Right. And like it’s, it’s, if it was so recent that everything feels so fragile, So I see the angle of founders feeling like, here’s a secret that we found [00:14:33] that works well for us. And I don’t want to share it with others. And, but I, I think to your point, it’s so valuable and there’s a huge market of people who are interested in starting a business or have already [00:14:42] started a business and want to know how to take it to the next level.

And there is some secrecy around transparency. Um, and so like, I don’t want to be the anti that. Like I shared how much [00:14:51] money I made for Morning Brew. I share how much money we’re burning on a month to month basis, how much money we’re making as a company. I, like, I’ve chosen to be extremely transparent, also under the [00:15:00] thesis of, we’ve hired 75 really smart people, and, like, I can’t solve every problem by myself, and if I keep the problems to, like, the leadership team That’s not allowing the 75 [00:15:09] people to use their brains and think of solutions that help push us forward.

So, I’m all in on transparency.

Andrew Warner: Alright, and I’m seeing questions come [00:15:18] in about, um, all kinds of, all kinds of things about how your software works, features that are not there, coming through. People are asking about, um, how [00:15:27] to, how your business builds. Uh, Gru, I’m watching all of you, especially you Solomon, keep those questions coming in.

What’s the opportunity that you saw that [00:15:36] made you say, okay, there’s an, there’s room for another newsletter. How did you see that? Another newsletter

Tyler Denk: software. Yeah. So a few things I can [00:15:45] explain in like a few pieces, I’d say one of the things we did really well at Morning Brew was we built a referral program, which led to over a million subscribers.

So it [00:15:54] was like a huge growth channel for us. We actually had a newsletter that if you got three referrals, you got like the Sunday newsletter, which was, we had 100, 000 [00:16:03] people on this newsletter made up of people who referred three people. So I had a minimum that’s 300, 000 referrals, like crazy success for this referral program.[00:16:12]

And we would get requests from readers all the time. Like the beautiful thing about email to your point and how you let off is like people can just hit reply and get directly in [00:16:21] contact with the writer. And so we would receive probably dozens to hundreds of requests every day of referral software are you using?

[00:16:30] How do you format your emails? How did you build the website to look like that? How do your emails look great in Outlook, et cetera? And to me as the person who built all [00:16:39] of that, right? Like I built the referral program. I was like working with the HTML to make the emails look good in all the different clients.

I built the dashboards. I knew what data we [00:16:48] were looking at. All of that was input to me as in, these are problems that I have as a consumer, or I have a hobbyist newsletter, or I work at another [00:16:57] publication who’s trying to launch a newsletter and the software that we have doesn’t allow us to do what Morning Brew is doing.

And the decision that we made at Morning Brew, or I kind of [00:17:06] naively made was, we’re going to build all of our software rather than buy. So like the whole build versus buy thing, there just wasn’t anything in the market that excited me, or I didn’t want to [00:17:15] be beholden to like their roadmap. So we built a lot of our internal tech.

So when these questions came in, like I knew the answer, and that is a signal that there are [00:17:24] people out there that want to use what we are using. So that’s like the first signal. And then I’d say the second signal is like at a macro trend, you see morning brew, the hustle, [00:17:33] Axios, the scam, like a lot of newsletters.

Making headlines, making millions of dollars in revenue and getting acquired. And then the third was Substack raised [00:17:42] a round at, I think, a 650 million. And this is three to four years ago. And that was kind of like the holy shit moment. Cause I went to Twitter and we’ll just see [00:17:51] people dragging their prod and ingrained, it’s gotten a lot better since, but like dragging their product, dragging the functionality, dragging like the very opinionated stance they were taking on how they were [00:18:00] building their platform.

And to me, to have something that seemingly so many people dislike, and raise a 650 million valuation, and what we built that morning not [00:18:09] only worked, but we had the case study from 100k to 3. 5 million readers, which very few newsletters have seen, so some combination of those three was, I think we have [00:18:18] the recipe of like how to scale a newsletter successfully.

With the tech shops to build it with a case study to build credibility. And that was kind of like the all in [00:18:27] moment,

Andrew Warner: the morning Bruce story, just being such a prominent story that everyone had paid attention to. What about this? Why not say, look, [00:18:36] there are all these different platforms for sending out email.

I’m going to create the tools for growing email. And I’d seen people do this, Tyler, on a small scale. There were tools [00:18:45] available to do that referral program where if someone shared a newsletter, they would get X and if they shared it with three friends, they would get Y and so on. Why not [00:18:54] create just a suite of all these tools that would work with MailChimp and Infusionsoft, which I hate, and all the other platforms?

Tyler Denk: I think you just answered the question, right? [00:19:03] It is when you sit in that part of the stack, You have to work with MailChimp. And then you have a user that uses, uh, Aweber. And now you have to [00:19:12] integrate with their API docs and understand, like, the limitations of their platform. And then Constant Contact.

You have a bunch of customers who’ve moved to Constant Contact and they want to build the same, or use the same growth [00:19:21] tools. But Constant Contact maybe doesn’t have an API, so you can’t serve them, right? And so like you’re constantly beholden to what rules and capabilities [00:19:30] these other platforms have, and you have to trust their data, right?

So let’s say one platform does really bad database management and like it’s inconsistent, then you’re constantly [00:19:39] like your users are yelling at you that the data isn’t matching up or that their readers are complaining that referrals aren’t counting properly, but it’s really a mistake on the third party.

And so to be [00:19:48] successful in that business, you have to be built. You have to be able to build your product on 15, 20, 25 different ESPs. And there’s always going to be another one that someone’s using. And you have to deal with [00:19:57] the problems, documentation, and everything of each of those 25 platforms. So one is a total pain in the ass.

And then two would be just like where you are competitively on the [00:20:06] stack. Any one of those platforms, as we are doing, can build their own growth tools eventually if they wake up to do that. And then you are no longer competitively placed to like [00:20:15] serve those users because rather than those users paying for the ESP and your growth tool, they can combine that in one and just pay for the [00:20:24] ESP that now has that growth tool.

And so you’re just susceptible to not having as large as an addressable market. Which is the inverse of what we’re doing. We [00:20:33] want to be the point where you go to create your content. We want to be the end all be all where all of your data is stored, where revenue is coming through, where we are paying you, and we can add growth [00:20:42] tools, audience development tools, monetization tools on top of it and consolidate, so you only need a single login and don’t need to manage 10, 15 different platforms.[00:20:51]

Andrew Warner: All right. That makes sense. What’s the, did you raise money first or build an MVP first? Built an

Tyler Denk: MVP first. So [00:21:00] we, me and my co founder are so decent, right? Um, good enough. I’d say, so my two co founders, Ben and Jake, were both software engineers that I hired at Morning [00:21:09] Brew. So building on the credibility of like three engineers who had built like the Morning Brew infrastructure and growth tools was our go to market of like credibility.

[00:21:18] And so we built for 10 months, which was extremely stressful because at any time, like we have like a very strong thesis of how we can differentiate. It. But in those 10 months [00:21:27] when, you know, all of the other competitors have full 30, 40, 50 person teams, and we’re three people doing this all nights and weekends, we’re like one announcement from one of those companies [00:21:36] launching like our big wedge into the market away from like everything that we just built, like being totally useless.

So extremely stressful. We built for 10 months. And then right before [00:21:45] launching, we raised two and a half million, which was kind of like we needed to pay ourselves. We have like software vendors, like. We are not second, third [00:21:54] time successful founders who can just fund everything. And I admire like the whole bootstrap route.

I love and admire, and like not having alternative, [00:22:03] uh, incentives with investors, I think is like super awesome. And for those who can do it, totally recommend that. But for us, like we just weren’t in a place where we could hire like a talented [00:22:12] CTO, pay ourselves and pay for vendors when we’re 25, 26, and like really just going out and trying to build this.

So were you able to get a [00:22:21] fully functioning MVP before you raised

Andrew Warner: money?

Tyler Denk: Yeah, I mean, yeah, we, yeah, 2021 is when we had like an MVP, we [00:22:30] raised money in July of 21, went full time in August, um, and then launched publicly in November of 2021. So about a month and a half from like [00:22:39] raising money, hiring an additional person, scaling it up and then launching, but yeah.

And you were doing this still while you were at Google, right? Nights and weekends, the most [00:22:48] stressful 10 months I’ve ever had. Not that Google worked that difficult because nothing actually gets done at Google, but, um, still just like having to manage two jobs more or less is like what [00:22:57] it felt with, felt like with the added pressure of like, again, at any moment our competitors could launch something that totally made all of our work useless.

So a lot of [00:23:06] anxiety.

Andrew Warner: I kind of was wondering if you ended up at Google partially so you can watch and partially so you wouldn’t have much work to do.

Tyler Denk: [00:23:15] I mean, in retrospect, that’s exactly how it played out, right? So any, any entrepreneur who’s like not ready to make the leap, maybe just go to a big tech company where you only have to do three hours of work and build your [00:23:24] tech company then.

Andrew Warner: I don’t know that works as much today as it did pre pandemic and during the pandemic, but, um, but [00:23:33] definitely there’s less pressure at those companies. I mean, my friend Noah Kagan famously said that he used to sleep under his desk at Intel. It was his, uh, it was his nap place. [00:23:42] Why’d you call it Beehive? I feel like that’s, that’s a challenge because I, I’ve got a partner link, by the way, for anyone who wants to try Beehive and see all these growth tools in [00:23:51] action.

I’ve, I’ve, uh, known Tyler now. Uh, gotten to know him really well this year. We’ve got a partnership with them and I’ve got a partner link that’ll let [00:24:00] you all try it for free and then get a discount afterwards. I didn’t want to make it into mixergy. com slash beehive because I said people are going to misspell it as it is.

Mixergy is a [00:24:09] bad name. I think it’s spelled. Yeah. Mixergy would, even my friends go, I love mix energy. Andrew is fantastic. Frickin A. Um, it’s mixergy. [00:24:18] So what I did was I ended up with a URL that would let people use it for free and I called it. Mixergy. com slash best email, and anyone who uses that [00:24:27] can try Beehive for free right now and see the tools and, and, uh, growth features that we’re talking about.

But why go with Beehive with two I’s, two E’s? [00:24:36]

Tyler Denk: I wish I had like an amazing story. Like I was like on some like psychedelic journey and it just came to me and I had to like, name it this, honestly, I got [00:24:45] extremely excited about just building. I’m someone who kind of needs like a foundation, right? So as I’m building out the, the landing page.

Or the dashboards. Like I need some colors. I need [00:24:54] like a style. I need like a theme to build on top of like. I don’t know. I just needed like a name. Beehive came to mind, like spelled properly initially, in terms of just like building a hive of [00:25:03] followers, kind of like a network effect type thing. Beehive.

com spelled properly was taken. We found a spelling that is not great, but works. And I’m [00:25:12] also like kind of a proponent of like, spelling doesn’t matter and like names don’t matter. I think if our product actually serves its purpose and works better than everyone else in the market, I think we could have [00:25:21] named it Dogshit and I think people would sign up anyway.

Um, so I’m actually like pretty opinionated that names don’t matter and hopefully I can continue to prove that out. But yeah, I just wanted something to [00:25:30] get started, a domain name to build on top of, didn’t think twice. And also I, I hold that opinion. So, um, there’s not like a ton of thought behind it, but yeah.[00:25:39]

Let’s talk about

Andrew Warner: the early marketing. I think if I remember right, what you were doing was you were going on Twitter and saying, we’re going to launch this thing, we’re building it and you’d built a wait list. Am I right [00:25:48] about that?

Tyler Denk: Yeah. The process of events is around. Before we went out to raise money for our seed round, we just basically put out there, like, here’s our thesis.[00:25:57]

Well, credibility, we are three engineers who had built morning brew. Here’s our thesis of what’s missing in the newsletter ecosystem. This is what we’re building. We’re going to launch soon. [00:26:06] If you’re interested, drop your name in the wait list. Got about 400 people to put their email in how many we ended up converting post launch, like maybe 25 [00:26:15] to 30, um, it actually might be pretty good.

But, but that was like, kind of like, again, like early stage for like a seed round, like Um, investors just want to see that you have a strong thesis, [00:26:24] that you have a good team and that there’s some interest in the market. And for us, that was a way to say, here’s 400 people who signed up for one tweet at the time.

I had like 2000 followers, [00:26:33] like not a big audience to work with. We got 400 people that are interested in this. Um, it’s just like an additional data point, but also that’s like your early customer list, right? So as soon as we launch, [00:26:42] I went through all 400 email them personally. Someone actually posted on Twitter the other day, they dug up the email of, they ended up moving over, I think like maybe a month or two ago.

yeah, But they like [00:26:51] found my email from when I reached out of like June, 2021. But yeah, I mean, it’s an old customer hit list basically to go after. It shows some sort of [00:27:00] validation that there are people interested in it. Um, but yeah, I know it’s hard thing about email. One thing that I think is not done [00:27:09] as much or as often and should be, I think it’s so common sense is.

Getting angel investors and strategic investors who are your early adopters. And [00:27:18] so in our first seed round, I think we had 25 total investors. We had one fund, which are a few funds, but social leverage led with like the largest check. [00:27:27] And then we were just collecting 10 to 25 K checks from, I’d say two dozen people who have a newsletter.

[00:27:36] incentivized by investing in the company, be asked to, Hey, can you also move your newsletter off mailer light over to to help like prove our product. One, it [00:27:45] shows traction to, you’re going to become like our core user. So we can learn from like what we need to build to like better serve you. And it starts building more momentum.

And because of the product [00:27:54] that we’ve built, it is product led growth in the sense that when this person emails a hundred thousand people at the time, you couldn’t like private label. So a hundred thousand people [00:28:03] saw our logo at the bottom of the newsletter. So there’s like network effects by having some of those early adopters.

And I always give a shout out in like every podcast, like Liquidity, the meme [00:28:12] account. He had a hundred thousand person plus lists on MailerLite to call execs on and no hesitation. He should, he should not have done this because we were so early [00:28:21] in the product. It was not polished at all. No hesitation, wrote a check, moved his newsletter over and became like our big first, like enterprise user.

Um, and like, that was [00:28:30] invaluable for us to have, like the, the credibility that execs some of a hundred thousand people can one, their newsletter look better, they had a referral program, everything worked [00:28:39] flawlessly and they were big enough that it was like a huge credible. Data point for us. So yeah, I think that’s like underutilized big time in terms of getting able to get them to switch [00:28:48] over.

What’d you say? That was an invest and switch where they invest in. And then after, you know, money hit the bank, I was like, Hey, we’re launching [00:28:57] in a month, we need some early adopters. We have like a handful of people that we’re already moving over, but you have a hundred thousand person newsletter. We can handle the volume.

It’ll be a great test for [00:29:06] us. Can you move over and like zero friction there there’s investors from that initial cohort of 20 Angels that I’m still bugging to move over. [00:29:15] Um, which is like really cool. Let’s, let’s talk about it. Who I’m usually pretty transparent. I’m going to keep that out of it, but I love your, yeah, I’m not gonna [00:29:24] Cody Sanchez using you for email.

She is not, but she also wasn’t part of the early angel. She was a later investor. Um, but she, she, I didn’t realize she had a fund. [00:29:33] We’re we’re in talks with Cody. Um, so I’m not, not as mad at her, but there are others who I’m still like, yo, come on, you, you wrote a C check. We’re like doing well, like we’ve proved it [00:29:42] out.

We have massive publications like, uh, so yes, but then there’s also people like liquidity who like no hesitation said, how do I do it? [00:29:51] And just moved like, and this is something at a hundred thousand subs. He was making good money. Like this was like a business line for him generating revenue. No hesitation moved over.

So I’m [00:30:00] always got to give a shout out when I can, because I appreciated that. The one that I kept seeing was it was Sean Porry, right? That was one of the early investors. [00:30:09] He was, he, he said no, actually the first few times. So he wasn’t in our seed round, but he did as well. And yeah, that was a huge [00:30:18] case study for us, which I think is where you’re getting at.

Milford is like an unbelievable case study for us because it was They didn’t have a big name. Obviously they have like the [00:30:27] podcast and Sean’s background, but like milk road itself was like a brand new entity that his business partner, Ben was emailing me, like, how do I buy this domain? Or like, how do I set up the [00:30:36] domain with like my DNS?

So like, not that he’s dumb, but it was like level zero of like, we were just like figuring this out. Like we are doing this for the first time to building [00:30:45] the website on BI, which we also host your website. To creating a daily newsletter that looks good. Rebranding using all of our growth tools. They had a referral [00:30:54] program, which I think drove 30, 35, 000 subscribers for them.

So they were a perfect case study of started with zero scale to about 250, 000 [00:31:03] subscribers and used our website, our growth tools, our data. All of our analytics and then got acquired. And like, if there was like a better case study of [00:31:12] going from zero to acquired in 10 months to get a quarter million subscribers, like totally using our tools on grant, again, Sean has a big audience and they also use [00:31:21] paid spend to acquire subscribers faster towards the end.

Again, like, I mean, it’s hard to think of like a better case study. So that’s why we’ve definitely championed that one. [00:31:30]

Andrew Warner: Yeah. They, and they also were big about talking about how responsive you are to their, to their needs on, [00:31:39] on the My First Million podcast. So they would say they needed something built and somehow there was a thing built for them quickly.

Yeah. I mean,

Tyler Denk: [00:31:48] if there was a competitive advantage of why I think BeYive has had success, It is, though, we give a shit more than anyone else, is like, the [00:31:57] best way that I think I can summarize it. And I’ve seen it from so many different people, from my co founders to employees to everyone. But, the, our, who leads sales right now, Daniel, [00:32:06] when he first was getting started, he might have actually been on contract at this time.

Someone from Canada wanted to schedule a call, like a demo, and it was on Thanksgiving, but, you know, in Canada they have a different Thanksgiving. [00:32:15] He, like, no hesitation, didn’t push back, just took a call on Thanksgiving. Like, went in the other room with his family, took a demo call. Just to serve this user, like didn’t push back at all, [00:32:24] all the way to like what Sean and everyone talks about of like, if you email me, you’ll get a response and we will hustle.

We have incredibly talented engineers. We don’t come from like an [00:32:33] incumbent place of we expect like things are going to move very slowly. They’ll come when they come. If it is a pain point for one of our users and we can help them build their business or solve [00:32:42] something that they’re doing. To prioritize that and serve them is like the whole purpose of why we exist.

And so we take that extremely seriously. And that’s why we move very [00:32:51] quickly.

Andrew Warner: All right. I think I know one of the people who hasn’t moved over that was in the seat. Scott Galloway is no mercy, no malice. I can’t feel bad with him. [00:33:00] No, but he’s on beehive. He is. Yeah, that, that one took a

Tyler Denk: while.

Andrew Warner: That took a while, but he’s there.

Tyler Denk: Yeah.

Andrew Warner: Huh. Well, I can’t tell what’s [00:33:09] beehive and what’s not. And so someone in the chat was asking about, um, Isn’t the domain an issue that it’s a beehive. It doesn’t have to be on beehive domain. You could

Tyler Denk: [00:33:18] use some domains, everything to, to your point. Right. Andrew didn’t even know that Scott Galloway was using beehive, which is kind of the purpose.

It’s also like a huge wedge [00:33:27] of the alternative and Substack being one of the competitors. Like, you know, it’s a Substack newsletter because they tell you it is everywhere to download their app, [00:33:36] to read in the app. It has Substack branding everywhere. It looks like every other newsletter, like Substack is building.

A medium for email newsletters. They are [00:33:45] trying to build a new social platform where you download the sub stack app and aggregate all of your content in one place. We are the opposite. We want Scott Galloway to have [00:33:54] his own brand, own newsletter, own website, own business without you ever having to know that it’s built on Beehive.

We just want to be the infrastructure and tools [00:34:03] to facilitate that and do an incredible job of that. But we aren’t trying to, like, we don’t say that, Oh, that’s a beehive newsletter. Like, we don’t say that intentionally, like it is [00:34:12] your newsletter to your brand. And I think that is like a huge differentiating factor.

And like, just the philosophies of how we’re building our business.

Andrew Warner: I think that is a mistake for Substack to [00:34:21] do, but who knows, maybe as they get bigger, they’ll, they’ll, they’ll, See that getting everyone together pays off because you can create these super [00:34:30] subscriptions and I get it. I just don’t like being at the whim of these different platforms.

At one point I was reading something on Substack and then I couldn’t, I, [00:34:39] um, because I needed something, I forget what it was, but I know that you had written an article on Medium a few years ago and in preparation for this, I wanted to go read that [00:34:48] article and I had to create an, an, an account now, back then I didn’t have to, when you posted it.

Not only that, I had to then create an account and then check off my interest, which [00:34:57] really pissed me off because I was in such a mood to move quickly. And this slowed me down that I had to pick three random interest for them and a couple of other things. [00:35:06] And then know that when their paywall came up, it wasn’t really to pay.

It was an opportunity to, but I could hit the skip button on the bottom. That’s why I don’t like any of these, [00:35:15] um, these platforms that brand my stuff with their stuff first.

Tyler Denk: Yeah, I don’t listen to a lot of people complain and a lot of people like to take their victory lap of [00:35:24] like VC funding versus like bootstrap.

And again, like I’m, I’m sympathetic to the bootstrap. I admire people who can do it. I think subsects are actually a case where you [00:35:33] see VC working against them. We’re at a 650 million valuation three years ago. You have to sell that thing for 2, 3, 4 billion. And you don’t get there by [00:35:42] just slowly building the email infrastructure in the way that they have already implemented.

They, as you see, as they built the Notes app, they have video, they have audio. Like, [00:35:51] they are trying to compete with Facebook and Twitter, um, which is like a big swing and ambitious, right? But it depends on, like, what you are trying to do and what network you want to be a part of. [00:36:00] They are in the game of we have to see a 5 to 10x return from the 650 million valuation that we raised at.

We are in the game of, we have [00:36:09] amazing unit economics. We’re like close to breakeven. And I think there’s like a multi billion dollar opportunity where we don’t need to keep raising venture capital. Um, so to, to totally different [00:36:18] games. And I think that’s why you’re seeing a lot of the product decisions that they’re making.

Andrew Warner: Speaking of you did raise money and you, according [00:36:27] to, to tech crunch. This was, let me see, 2023 in April, you were profitable. [00:36:36] Then a few months later, you raised 12. 5 million and you’d shifted direction from profitability back to losing money and spending on growth. [00:36:45] Why’d you make that decision?

Tyler Denk: Yeah, I think again, as someone who admires the bootstrap route and obviously wants to build a profitable [00:36:54] business, our goal is not to.

Be on the venture flywheel of raise money, go unprofitable, raise more money, go unprofitable, dilute everyone at the company, [00:37:03] lose control. So like we have full control of the business, full control of the board, great unit economics. But once you’re in those decisions, you see like two passes. [00:37:12] Okay. Here’s the path towards profitability where we could grow less aggressively.

We can maybe not make three or four hires that we think would make a huge difference. Like we’ll make them maybe over the course of six months, [00:37:21] but at an opportunity costs of scale now versus scale later. And like, as you get more and more into a more competitive industry where other [00:37:30] competitors are starting to wake up, take our users, they want to build features.

They want to match the output that we’re making. It kind of becomes like two doors. And like, one is like the more [00:37:39] sustainable long term business. One is like, here’s an opportunity where we have tons and tons of momentum. We have a real path forward to take market share. And the opportunity cost of [00:37:48] going through that door at, you know, being slightly unprofitable for a bit of time is probably the more strategic decision to make.

And so we’ve done like all of the different [00:37:57] analysis and figuring out what we think is the best situation for us and our users to build a long term solution that they can build on. And for us, it’s hiring the people we [00:38:06] need now, reaching scale, building network effects, being able to launch the ad network and everything we have there sooner than later.

I think we’ll pay dividends and we’ll get the [00:38:15] profitability sometime next year.

Andrew Warner: You then raise again earlier this year? 33 million. Did you take cash off the table? Uh, me personally [00:38:24] for this BI took a little bit. Yeah. This was like NEA was uh, was one of the investors, right? Yeah. Huge VC firm. Alright.[00:38:33]

Tyler Denk: Those two doors, situation happened twice, right? It happened at the series A and then at the Series A was slightly different at the Series A it was, we [00:38:42] were operating, we had about a million in the bank at the time. Like, ’cause we only had raised the seed round. We were punching way above our weight and everyone that we were starting to ruffle [00:38:51] feathers with just so outcapitalized us that I had a, Oh shit moment of, I think we have the better product, the better team, the better vision, but like we could lose [00:39:00] in this market solely because we don’t have enough capital when they are trying to poach our users with like large advances and everything else, I felt vulnerable outside of my control from a [00:39:09] capital perspective.

So that was like an opportunity where I think we could lose due to lack of capital. So that was the A. The B was actually the door of like, we could do this slow [00:39:18] and steady and like just, you know, hanging out around break even. But I think like the opportunity cost of that is losing users and market share to our competitors where we could go like, [00:39:27] let’s go all in on this.

Let’s ramp up our spam. Let’s hire the machine learning engineers we need. Let’s hire like this team that I think will really differentiate us. And like, let’s really try to take this [00:39:36] market. And so that was the reasoning behind the Series B.

Andrew Warner: Alright, what’s, what’s working for you for getting new customers [00:39:45] today?

A

Tyler Denk: little bit of everything, right? So we have like a very diversified approach, everything from like old fashioned SEO, right? We pump out [00:39:54] articles to building in public. We have plenty of people sharing their stories of building their newsletters. We do paid spend across Google, YouTube, Facebook [00:40:03] display.

We sponsor other newsletters. Um, we have a sponsor, uh, you sponsor bootstrap giants, newsletter trap giants. We have a [00:40:12] partner program, which is like an affiliate program, right? Which is also where you can get paid. Shout out. You can pay 50 percent of all revenue for anyone you recommend to use beehive.

That word. Hello. [00:40:21] Um, what was that for? How long for, for 12 months? So if you have, if you convert, if you tell your buddy to sign up for beehive and he pays a thousand dollars a [00:40:30] month for that first year, you get 500 a month for every month. So a lot of people are making 20, 30, 30, 20, 30, 40, 000 a quarter off our partner [00:40:39] programs.

That’s a huge competitive advantage for us. Um, a little bit of everything, top of funnel, social, we do organic YouTube, we do organic social. Um, [00:40:48] paid. It’s kind of like across the board, we have a pretty well diversified growth and acquisition strategy and in a sales team as well.

Andrew Warner: [00:40:57] Let’s shift gears here.

Let’s talk about how to grow my newsletter and my listeners newsletters. You guys have a ton of tools, and I’ll be honest, all the tools [00:41:06] that you have I think could be replicated with others. I like the all in one though. I don’t like to go and use a third party plugin to reward people for, you know, Sharing my [00:41:15] newsletter, partially because it puts another mental barrier before testing a new idea.

And then you have to go and figure out the integration. So I like that it’s all here, but if you’re out there building a [00:41:24] newsletter, I like this section to be helpful for you, regardless of what platform you’re on. What, what, what’s working? What should I be [00:41:33] spending my time on? You have so many freaking features for growth.

Where, where am I going to get the best result?

Tyler Denk: Yeah, I’ll walk you through, I guess, a case study of what I’m doing for my personal newsletter. [00:41:42] Because I feel like if I’m doing it, like that is kind of the recommendation I would give other people as well. So first, let me just say this.

Andrew Warner: It’s uh, it’s Big Desk energy and you have [00:41:51] one of the coolest homepage for this type of, it’s just a really great website, go to Big Desk Energy, and it’s got a good vibe.

I think you’ll enjoy playing, ar, [00:42:00] playing around with, and then

Tyler Denk: newsletters.

Andrew Warner: Typically it’s

Tyler Denk: mail MAL dot big desk energy.com. But we’ll, we’ll toss the links. Somewhere. But they could click the mail on the left side and [00:42:09] see It’s a little bit more complicated. I mean, if we’re talking conversion rate, I’m sure it’s a little bit harder.

You might think about playing a little bit of Pong, listening to music, you know, so. Higher conversion directly on the landing page. [00:42:18] Fair. Um, alright. What’s working? Yeah. So when I launched my newsletter, first and foremost content, no one wants to hear that if the content’s not good, no, one’s going to share it.

No, one’s going to sign up. [00:42:27] People are going to churn. So like make sure the content’s great. Bootstrap science is great. I think Mel, I think that a big desk energy is great. Make it valuable. Make it something that

Andrew Warner: let me pause on [00:42:36] this. I want to know how to make content better. I don’t want to spend forever on this, but here’s the thing.

When it came time to selling. What I did was I reached out to people, I understood what their [00:42:45] problems were, I kept asking and digging deeper, and then I went back and I said, okay, I think we could create this thing, and we created it, and we launched it. When it comes to content creation, [00:42:54] is there a process that’s that methodical, or is it just sit down and bleed on the paper, and don’t stop until you feel

Tyler Denk: it’s

Andrew Warner: great?

I

Tyler Denk: think it depends, right? There’s a lot of different [00:43:03] newsletters. There is like the content aggregation newsletters, like a morning brew for business and finance news. There’s like VC newsletters. They’re like introduce deal flow and like [00:43:12] help you perform your job better. There’s thought pieces, right?

Like, uh, sir, techery and Ben Thompson doing Penn Thompson doing analysis on tech. There’s big desk [00:43:21] energy. That’s just like talking about building in public as is bootstrap giants of like, you know, how, how to build these different businesses. So I think you’re just making a thesis of like, what is valuable to you and the [00:43:30] people you’re trying to serve.

And can you communicate that effectively where they look forward to opening your email, whether it’s to inform, whether it’s to entertain, whether it’s to do their job or business [00:43:39] better. Um, that’s ultimately what you’re trying to do. Okay. Um, so like very subjective, right? But, but I always caveat and always say start with content because people get [00:43:48] super caught up in like the flashiness of referral program and boost and recommendations.

And like, if your content sucks, but you use all the right tools, your content still sucks and it’s not actually going [00:43:57] to work. Um, so content first and you can test that by writing a Google sheet to your friends or what, whoever your target market is, but make sure it resonates and it’s something that people actually [00:44:06] want to open.

So step one, okay. Assuming you can actually nail the content and people want to share it, create a referral program. It’s like set and forget it. It can be as [00:44:15] simple as I have a Shopify store for my swag or whatever. It’s 25 percent off coupon. It’s all drop shipping, right? So I have no inventory. If you pay 25 [00:44:24] percent off, it costs nothing to me.

It’s just saving you 25%, but it’s an incentive to share your newsletter with other people. Also, we have new swag dropping soon. So excited about that, but you can also do like [00:44:33] PDF, right? So if you’re, if you’re a bootstrap giants and you’re creating resources for different businesses and people to understand like how they can build a better business, you [00:44:42] What if you, you spent the day creating a PDF and this is what Milk Road did.

They created a PDF of here’s 13 predictions that these crypto experts think will happen in the year [00:44:51] 2022 or 2023. If you are reading Milk Road, cause you’re interested in crypto and you are teased with this carrot of here’s like some secret exclusive [00:45:00] content that 13 experts say are going to happen.

It’s like a very high overlap of like, I’m interested in crypto. I signed up for the newsletter. Yes. I will refer one [00:45:09] person to get this PDF. For milk road, it took them four hours to write that PDF they created in the referral program, they add it and they’re hands off done. Um, [00:45:18] so I would say the referral is kind of like a, if you can find the right incentive, It is set and forget at once.

You know you’re providing value. People will share with other people [00:45:27] to abstract and, and receive. That’s still working. That referral on the bottom that says,

Andrew Warner: You read this newsletter. If you share it with a friend, I’ll give you this thing.

Tyler Denk: I’d say it’s [00:45:36] not to my, to my knowledge, not to the extent that the Morning Brew 1 million people are referring.

I think that was like, geek, like, novelty, [00:45:45] different brand affiliation and everything else. It’s definitely been getting a bit more tired when every newsletter has a referral program, but it’s like one of those things, like if you really can [00:45:54] serve your reader well and incentivize them, it’s just like low hanging fruit.

You take 30 minutes and set it up and it’s done. So that was like the second step. Third [00:46:03] is recommendations. So I found three to five other newsletters that are non competing, similar target market. Like I would love for their readers to know [00:46:12] about BigDesk Energy and vice versa. So organic recommendations, you choose, you can send an invite, you connect.

When people sign up to BigDeskEnergy, they see the three [00:46:21] newsletters I recommend. They can opt in to one or none of them, or all three, and vice versa. And these are like people that I’ve curated, I trust, I like really want to get in front [00:46:30] of their audience. Again, set it and forget it, like I’ve set it up at the very beginning.

It’s been hands off and driven a few thousand subscribers. Um, the key there is just finding like a good [00:46:39] pod. Like if you can find the two to four other newsletters that actually do align with your target readership, It’s a home run. If you’re just like, what do you have? Who are you doing [00:46:48] this with? Who’s in your pod?

It’s a great question. I should be you guys. Um, let me, let me check. Um, it’s been, again, this has been one of the first things I set up back in January, so I haven’t touched it [00:46:57] since it’s like truly set and forget it. Um, so that was the second thing. Those are like the organic. And then the third thing I did [00:47:06] was, so we have a boost network where basically I’m putting money into being able to grow the newsletter faster.

I think I offer 2 per lead. I have an [00:47:15] offer you can apply to boost BigDesk Energy, which really, it’s basically the recommendation feature, but sponsored. And for every subscriber you send me, you get paid 2. [00:47:24] I am like, super careful in who I choose to accept there, and I have about 15 to 20 newsletters sending me between 2, [00:47:33] 000 newsletters per, or 2, 000 to 4, 000 subscribers per month.

Also passive. And with the cohort analysis

Andrew Warner: within beehive [00:47:42] and see whose, whose subscribers are opening up more, clicking more. You can

Tyler Denk: write in the dashboard. We have like [00:47:51] basic, like acceptance rate, open rate, click through rate. So like the basic data where you can see directionally, like this is a better quality subscriber.

You can also double click into our [00:48:00] reports and see like full cohort analysis, location, uh, opens clicks, like everything per, per subscriber. Acquisition source. And so I actually did this this [00:48:09] past weekend. I like did a full audit of all like 25, 30 newsletters who were paying for me or who I was paying to help me grow.

And I cut like three or four that were just like [00:48:18] performing a bit worse than others and that like, and we’re going to automate that soon as well as like a sneak peek, but basically optimizing those campaigns again, set and forget it. [00:48:27] Um, so I put a few thousand dollars a month into that and I have, you know, 15 to 25 newsletters giving me subscribers.

And then the last one is just paid spend. [00:48:36] Um, I think it depends on like what your business model is and like what your objectives are, but there’s no way to really hit scale within these network effects. Without like reaching net new [00:48:45] subscribers via LinkedIn, Instagram, Facebook, like where there’s hundreds of millions of users.

And so

Andrew Warner: I,

Tyler Denk: sorry,

Andrew Warner: [00:48:54] I didn’t know what that button did. Um, I just, there was a button, someone, a couple are sending me comments. There was

Tyler Denk: a button. I’m sorry. I ran. So that was the last one [00:49:03] at some scale. Once I have begun monetizing the newsletter with ads, then I take the revenue from ads, put it into boosts and put it into [00:49:12] paid spend on social.

And I’m running campaigns on Facebook, Instagram, LinkedIn, and getting about a dollar, dollar 50 per subscriber. And so it’s that [00:49:21] flywheel, like all four to five things. And then obviously the easiest thing is I share everything on Twitter, LinkedIn. So I post something. I think it’s a good content. I share it, get subscribers.[00:49:30]

Andrew Warner: Um, what I was doing was I was looking at some of the comments that came in and there was a button that says show and stream. I said, let me see in context what that means. But as soon as I hit [00:49:39] it, like this one. Um, it just showed for everyone who’s watching live what Randy had said, which is a pretty cool feature.

[00:49:48] Randy said, by the way, I’ve emailed Tyler and he replied right away. I like that you can do that. Um, here’s what’s working for us. There are two things and I’d love your help to do those even better. [00:49:57] One is doing live events like this. People register so that they can come see it live and also they register to get a recording of it afterwards.

I’d love to make it [00:50:06] easier to create landing pages for these events so that we could, I guess, I guess it’s both for both, uh, things that are working for us. I would [00:50:15] love landing pages. So landing pages for the events and then even more so landing pages for lead magnets. We have taken the newsletters that have done [00:50:24] especially well.

Like Jesse’s got this thing where he goes through a 30 minute sales call and he’s outlined the process for doing it and he’s pretty consistent about it. [00:50:33] So we, he wrote about it for one of the newsletters. I had our designer turn it into a PDF, which was an easy thing to do. And then we used that as a lead [00:50:42] magnet.

Here’s the perfect 30 minute meeting. Here’s how to sell in 30 minutes. And I have to create a landing page on Card, the site that has two R’s [00:50:51] in it. That when somebody wants it, yeah, no, um,

Tyler Denk: so it doesn’t matter in those cases, so all my [00:51:00] growth strategies are set and forget it. So I actually forgot. I do have lead magnets running as well.

I had two that I created one was the, and it fits like, again, my target [00:51:09] market. If my target market is founder to want to know how to build and scale like a successful tech company, like, which is my target market, I took our seed deck [00:51:18] and created a lead magnet for it. So. Here’s the seed deck that we raised two and a half million dollars without a product, super catchy, drive people to a page that I’ve created in [00:51:27] beehive.

They sign up, they get an automation, which has the PDF file attached to it. So that’s like an amazing lead magnet set and forget it. We run ads to that. I share it, [00:51:36] uh, frequently, whatever. Um, two other things I do, we have another lead magnet. I created like the remote handbook, because we’ve been totally remote.

We’re across 12 [00:51:45] different countries. It’s like, people are always confused at like how you build a remote company. I wrote like a whole handbook, another lead magnet. Um, and then to your first point on like the [00:51:54] custom landing pages and events and everything. Back in May, we acquired a company called TypeDream, which was an NAI web builder.

The AI part’s like [00:52:03] cool, the web builder part is amazing. I think they actually built one of the most powerful website builders like in the industry. They’re just like a smaller player. [00:52:12] And so we are four months into integrating and rebuilding their product into Beehive native. And that is what excites me the most is I [00:52:21] think we are going to have like an A plus website builder with all of the custom landing pages, splash pages, signup widgets, and Nav bars, footers, [00:52:30] everything like that you would expect from Webflow or a Framer built natively into our product.

And that should be going live sometime in Q4. [00:52:39] So yes to all the above. Lead magnets are like an amazing, amazing acquisition. Events are great as well. And like we’re building the website features to make that super seamless. [00:52:48]

Andrew Warner: All

Tyler Denk: right. Actually, here’s

Andrew Warner: another one. And this one you do have, and this one’s worked well for us.

Jesse, in addition to partnering with me on Bootstrap Giants, owns [00:52:57] Gateway X. It’s a venture studio where he’s launching multiple companies. He wants to launch more. I said, why Combinator is doing these requests for [00:53:06] startups? They’ve done it for years. For startups they want to see created and that they want it back.

I said, you keep coming up with all these ideas for businesses you’d like to partner with and create. [00:53:15] Do that. He wrote that up. It did well by email. He then did it on Twitter, said, here’s the startup I’d like someone to build with [00:53:24] me. And the link from the follow up tweet was to the main article for people who want to read more.

But because Beehive has this [00:53:33] feature that says, When someone scrolls past a certain point in this specific article on the web, ask them for an email address. We did that. That killed [00:53:42] because people came in looking for more information on a topic. They showed interest. They started reading. We got their email address.

They got the rest of the article, and now they’re in our world. [00:53:51] That’s fantastic.

Tyler Denk: Yeah, we also have, so there’s two ways. One is a pop up, which is, I think, what you just described. And the other, more restrictive, is an email gate, which means, like, you literally [00:54:00] cannot read any bit of the article. That’s what we did.

Yeah. Unless you put in your email. And so I left that out of my strategy as well. Every single one of my posts online are behind an [00:54:09] email gate. So you have to put, I hype it up on Twitter, LinkedIn. Like my last one I shared yesterday was I think, uh, processes and middle [00:54:18] management kill companies kind of controversial.

I have a very opinionated stance on it. Does great on LinkedIn. You click through to like, see why I think that, and you have to put in your email to read it. [00:54:27] So again, I think one, I’ve, I’ve already sky between. Going through my entire 10 minute ran of how I’ve grown the newsletter, you’ve reminded me of two new things with lead magnets and like the email gates that I also [00:54:36] do, which I think is a signal that like we do offer such a comprehensive, like you can pick and choose what works well for you.

And they’re all totally out of sight, out of mind, set and forget it. [00:54:45] Um, and there’s also not a silver bullet to growth. There’s not, here’s one strategy that will make you go from zero to a hundred K. But I, I do seven to eight different [00:54:54] things on autopilot and not any one of them has like, is the reason I’m growing.

It’s the combination of all of them. You

Andrew Warner: know, there’s an internet [00:55:03] marketing event called, uh, baby bathwater. They get together, they ski, they just kind of hang out all these people who are great at marketing online. But if you can catch one of [00:55:12] them for a drink or a coffee or something, they will tell you one or two techniques like what you guys have a beehive for growing that they built into their company.

That’s [00:55:21] fantastic and exciting. And I feel like what Beehive is, is like having that atmosphere, but with a coder building it for you. You guys are just obsessed [00:55:30] on growth. I like when you make, when you make it easier for me to design or send out an email. That’s always nice, but I just get obsessed on growth.

I don’t think another design or [00:55:39] easier way to write email is going to help my, help me or my audience that much. But if you can give me another little tool for getting somebody who’s read my article [00:55:48] online to sign up, I’m golden. That’s my, that’s my obsession.

Tyler Denk: Yeah. And again, I think going back to like our competitive advantage of giving a shit more is if [00:55:57] you come into my inbox and say, here’s something that would help me grow my business faster, have you thought about this strategy?

Like we have 25 incredibly talented engineers, like [00:56:06] that is their job is to help our users. And so we are always looking for feedback. I’d say a large percentage of our roadmap is actually just derived [00:56:15] from direct user feedback. So, if you have ideas that

Andrew Warner: will help you grow. What, what about this? Someone I can’t find in one of the chats, I’d love to put it on the screen like I accidentally put the other one.

[00:56:24] Um, but I’ll just tell you. They were saying, what about SMS? That, can you do an SMS messaging also?

Tyler Denk: So, currently for [00:56:33] us, no. I am actually, I have an opinion and stance on SMS as well. Like, I, I don’t like it. And granted, like I think there are certain use cases for it. I find it [00:56:42] obnoxious. I don’t trust any brand with my phone number cause they abuse it.

And I’m, I’m like inbox zero in general, but SMS zero for sure. Um, so I’ve never [00:56:51] given brand I’ve given brands my number for like a, if you give us your number, here’s 20 percent off your first order. I take advantage of that and then cut off the SMS. But I think SMS is the thing that [00:57:00] everyone loves the hype of 99 percent open rates.

Like it’s the greatest cause everyone checks their phone and their texts. But I think it like as an actual longterm medium is [00:57:09] obnoxious and annoying as hell. Granted, I could get there in the future. There are legitimate use cases for it, but like for us right now, our target user and our target, uh, [00:57:18] offering like is not SMS.

All right. Let me close

Andrew Warner: out with this question that I’m fascinated by within this ESP space. It’s [00:57:27] really hard to get somebody to create a new newsletter. Like creating a new website is hard enough. But A newsletter is create [00:57:36] this thing, design it, and then come up with content every week versus there’s so many other tools, like I’m looking at my computer, I have [00:57:45] tons of different tools for taking notes, drafts, Notion, which I love, the notes app that comes in the computer and a few others, um, that nobody will know.

I’ll install [00:57:54] another note app forever. I’ll install another thing forever. But. There’s something about email that’s really hard. What do you do to get over that hump of [00:58:03] they’re not ready to do it now. It’s hard to convince

Tyler Denk: them. Well, I think there’s two things there. One is on like the technical and product perspective, building templates to make it easier to [00:58:12] get, go from zero to one.

So I would say one thing that we do like a C plus at, if best. It is like easy, quick start template. So you can [00:58:21] come in and choose from like 15 different templates on the email side and tweak a few things, same for the website and then same for your first email template and just get it out. Um, [00:58:30] we allow almost too much flexibility and customization, which is always like a double edged sword.

You can kind of do anything, but it takes a lot of time when you offer all of those options. So that’s something [00:58:39] we’re working on the product side. You take you from zero to start. The other thing I think you hit on is like, it is really hard to convince people to go from not having a newsletter to having a newsletter.

[00:58:48] So we, we don’t, we, we targeting people already in market, that have newsletters sending on MailChimp, ActiveCampaign, Substack, ConvertKit, you [00:58:57] name it a shout out. We have a ConvertKit promotion going on right now, entirely free for six months if you move over from ConvertKit. Um, but that is part [00:59:06] of like the reason why we do that is because it is a market market.

that exists and there are already people who have taken the plunge and creating a newsletter. And we are saying we’ve built better software, [00:59:15] better growth tools, better data analytics to do it better. Um, and so that is kind of like the market that we’re operating in. And I also have a [00:59:24] thesis that if you get the market leaders, like let’s say we have the largest fitness content creators.

We have Arnold Schwarzenegger. We have Peloton instructors. [00:59:33] The long tail of other people interested in fitness who are interested by a newsletter but haven’t started one, having the market leader in that space is kind of the push [00:59:42] to encourage them to start a newsletter. So that’s kind of our growth strategy.

Andrew Warner: I, I still struggle with my own newsletter at Mixergy. I’ve got 16, 000 people in it and I [00:59:51] just struggle for what to write on it. That’s another challenge of what to write. Um, I’ve got a writer now helping me. We’re just going to be doing [01:00:00] interviews and turning my, my conversations with him into, into newsletters.

I think maybe I also overthink it.

Tyler Denk: I, that I’d [01:00:09] say when I decided to launch a newsletter in January, I was full of ideas. I have a notepad of like 20, 25 posts, like ready to go in my head. And then I’d say, as of the past few [01:00:18] weeks, I’ve definitely hit like the, Oh shit, I have to send a newsletter on Tuesday.

Like, I don’t know what I’m going to write about yet. And the combination of writer’s block with expectation [01:00:27] with also like building a company and having like a lot of other work and stress, um, has definitely been weighing on me a bit more. So I totally, totally feel you.

Andrew Warner: I’d love to turn [01:00:36] more of these conversations into newsletters that actually matter, you know, pull out the things that, like, I, I love what you said about you could name a, you could name a company dog shit.

And if it’s good, people will [01:00:45] sign up. I love that, uh, uh, Cortlandt Allen, the founder of Indie Hackers, jumped into the chat on that one on, on one of the Twitter accounts, on my [01:00:54] personal Twitter account, he goes, no, uh, names matter for sure. And so maybe that’s my, my direction. Take more out of these conversations and turn them into, [01:01:03] into newsletters.

Tyler Denk: Yeah. I mean, if there’s anything that I makes BigDesk Energy interesting and how I’m building the business is I do think I [01:01:12] have fairly opinionated stances on different things and I’m trying to prove it out in real time. So when I have a huge stance on anti process and anti middle management, [01:01:21] like that goes against the grain for how most companies in corporate America have been built and like, you can follow the beehive story, the journey, the newsletter to see like how it’s working for us [01:01:30] in real time, as with the naming convention, as with remote work, as with a lot of these other assumptions that I make.

Um, so if you disagree, you can follow and you can see if this [01:01:39] blows up in my face, when we fall apart for not having any processes and middle management or being a remote company. Or I can prove that we can build a multi billion dollar business with a name like [01:01:48] Beehive in a remote culture with no middle managers.

Um, and that’s part of the journey.

Andrew Warner: All right. Thanks so much for doing this. Um, I do actually have [01:01:57] a partner link for anyone who wants to go and sign up and use my partner link and get access to Beehive for free right now. And I really think that what you should do is Go and explore it, [01:02:06] see what you think of it, and, and basically explore the, um, the growth features.

Even if you don’t end up sticking with Beehive, and I think you will, once you start, it’s fairly easy to keep [01:02:15] going. You should at least know what the different growth tools are that will help an email, uh, get more subscribers. So, here it is. It’s [01:02:24] mixergy. com slash beehives, two names that I have to spell.

I should have

Tyler Denk: picked dog shit for my

Andrew Warner: name

Tyler Denk: incentive. But again, everyone comes from online. They just [01:02:33] click a link, right? Which is why I don’t think names matter. There will be links. Just click the link. If you use Andrew’s link, you get 20 percent off, I believe, for three or six months. [01:02:42] Um, you also, my email, tyler at beehive.

com. If you have questions, concerns, thoughts, need migration help, I’ll see you next time. We have solutions engineers. We have migration specialists. You have [01:02:51] me, we will make it a success. So give it a try.

Andrew Warner: Wait, I can give you my other email accounts, username and password, and you guys can switch over or how does it work?[01:03:00]

Tyler Denk: Uh, we’ll work with you, your team. Like we can go, we can figure it out. We we’re like scrappy. We have people who are super technical who just want to get you from point A to point B. They’ll help you [01:03:09] with automation with templates. Like we’ll take care of it.

Andrew Warner: All right, here it is. It’s a mixergy. com slash.

Uh, B H I B E E [01:03:18] H I I V, but of course there’ll be a link. Thanks everyone. Thanks Tyler. Bye.