Chime Social Revenue & Valuation (2021)

hello everyone my guest today is spencer jones he's an unstoppable learner currently learning how to build software companies he's built three products in the past that made xero and shut them all down recently he launched chime social in january this year a twitter scheduling analytics tool and uh his first profitable product spencer are you ready to take it to the top let's go we love profitable products why did you decide to dabble in twitter analytics as this uh this last one in january yeah my last product i spent 18 months building like i said zero revenue and at the end of that as you you have this experience of i spent a whole bunch of time nobody cares what i built nobody wants what i've built and so i decided this year i'm gonna just i'm gonna do things differently not overthink it so i was going to build four products this year one every three months until something sticks i wanted to build something that connected with software engineers i wanted to get active on twitter so i started chime as twitter scheduling for software developers that just didn't work out you know got some early customers other users but they're more or less like developers don't developers aren't necessarily the persona that you would attach to tweeting a lot right right right but i had built some sort of developer specific tools like being able to kind of you know natively do code snippets and stuff like that that were like well formatted and like optimized for posting on twitter but people just it it wasn't really capturing anybody's attention so i was doing that in january but i did get like my first customer in january dustin mccaffrey who was on your show a couple weeks ago um which was which is awesome and great yeah so i just i just didn't overthink it i just went for it and um after like after a couple months not feeling like really much traction there at all uh i thought like i wanted to do figure out when my followers were active been doing a bunch of work with twitter api and like figured something out and at the end of a my working session i had this chart that showed a graph of like what my best posting times were based on my followers activity tweeted a picture of that and it kind of instantly got some interest from that um so i built it productized it shipped it got like four or five more customers one-man show right now you do you do everything i do everything yeah 100 no investors correct love this okay uh i don't bury the headline how many customers should they do you have uh last i checked it's somewhere around 70 or 80. um great and and what's the pricing model on this twitter analytics tool how much they pay per month it is currently nine dollars per month or eighty nine dollars per year okay so so i have so many questions right because there's a lot of first time a lot of listeners right now going i'm stuck in corporate i'm gonna launch my own sas like spencer you know the heart the hardest part might be the hardest part in the sas the whole life cycle from zero to hundreds of millions in revenue is the first customer like the first paying customer so how did like tell can you tell the actual story who was it and how did you actually get them to stick in the credit card and pay nine bucks a month yep so i started the price point starting out was a little lower seven bucks a month and uh it this it was it was uh cheating a little bit because dustin was running this thing on twitter said you know if you're an indie maker and you don't have any customers yet like reply to my thing and i will be your first customer and that kind of blew up he i think he ended up like being the first customer like for 60 people's products or something like that uh but he was my first customer and he's still a customer and like just upgraded the annual plan just like show longer support but that gave me such a huge boost of confidence so i think that like if you are just out there trying to get your first customer you gotta hustle a little bit you gotta put yourself out there you gotta reply to that stuff um you gotta like look for people who are talking about your problems say hey you go use my product uh and getting what i've said is you can get your first customer then you can get 10 if you can get 10 you can get 100 if you get 100 you can get a thousand so uh you just got to get that first one yup no totally so 75 customers six uh seven to nine nine bucks a month each or they pay annually so you're doing what like 600 700 bucks a month right now on mrr uh it's a little lower than that's just under 500 so okay um great that's great though still i mean this is this is this is i mean this is a fantastic story so after dustin explained to me how you went from 10 to 50 customers yep so uh i ran something that like as i was releasing some of these more analytics focused features improving the scheduler i knew i wanted to raise prices so somebody said hey i've uh i've got i think i said 10 slots left at this pricing point and then it goes up uh and those were taken in about like in about 24 hours would you say that too though you tweeted this it was an email list what all everything's on twitter okay yeah twitter right now is my only channel which kind of makes sense because it's a twitter scheduling and analytics tool so i want to find people on twitter yeah yeah i just was tweeting that to folks that are following me on my personal account uh so so that was a that was a nice little jump that took it to like 140 150 or so and it's kind of been slowly growing it's great because it's a network tool so people talk about time social on twitter so other twitter users find it that way and then you know so it's kind of like continued slow growth talking releasing new features uh you know tweeting pictures of what's happening building in public and that that gets interest and then i did an official launch i actually renamed the product to chime social did an official launch with like a nice uh promotion that was like 25 off for one day just as like a launch thing and that also got a pretty good bump and got it up to about uh about the 500 mrr mark that is this is like this is a this sort of a microcosm of what you've seen a lot of very successful sas companies say analogies and nathan barry right convertkit the way he's like driving a lot of growth right now is he's doing these mini competitions so so there's some sort of activity or thing that you as the founder put into the world whether it's a tweet because you're increasing price or letting your customers compete and when they compete they use you more end up paying more but doing these like little competition things i think are really powerful what's the next one what's your next idea i am not set on uh what i'm going to do next to drive some more revenue i'm releasing um i'm going to be releasing some new features around content analytics a lot of the analytics so far have been focused on timing when your followers are active all that i want to get into kind of optimizing your content and figuring out what's working so when those features go out live i'm going to do some promotions around that as well you're at nine bucks a month right now you've got to go 60 70 people on that what happens if you just increase it tonight to 47 bucks a month bucks a month um i'm grandfathering folks in because i think that's the right the right thing to do um honestly i don't know i don't think that the value is quite there yet um so the way i like to frame that conversation is if it's 47 bucks a month i want to know what makes it worth 47 a month and i think at that price point you're targeting power twitter users who are getting financial gain from twitter right like they're they're selling it's an important marketing channel or something like that so uh my guess is that my conversions would totally tank at that price point but i think you could have a really interesting conversation around what is worth 47 a month for a twitter tool generally speaking with most early stage owners i talk to they always devalue their own tool they always think it's worth less than what the market actually thinks it is worth especially if you just went 18 months with a product that no one paid for and maybe your confidence took hit now you're like i just want to get customers seven bucks nine months feels really really good and so it's always it's always a question i'm interested in asking right is how do you think about pricing and how do you go up do you feel like you potentially do devalue the tool i mean have you asked have you gotten great stories from folks going oh my gosh this is so cheap i'm using it it saves me three hours a day yeah i i haven't gotten any feedback like that i do know that i've gotten folks from competitive products that are priced higher saying that was too much so um and chime socials kind of write in where some of some other products are yeah so uh i'm a little nervous based on the fact that i've gotten price sensitive customers coming from other products going that was too high yep yep when when they come to you and after they sign up and they say it's too high do you ever ask them hey what could they have added that would have made that price point totally worth it for you and and do you get any product ideas that way how do you get i mean this is one of the things you have to do you're a solo guy so you've got to prioritize feature feature releases how do you sort of decide when to listen and when to not listen to your customers yeah um i'm the i'm the primary user of my product and that's that's a dangerous spot to be because sometimes you build something just for yourself uh why is that dangerous why is that i think a lot of people listening will go no that's a great thing why why would you consider it dangerous why is this dangerous so uh arvid uh arvidkal had a great episode on his podcast the bootstrap founder where he really dives into this but the danger is that you you are facing a problem and either you're the only one who faces that problem or the solution that you build you're the only one who wants a solution like that so you really have to balance building something for yourself with with validation from other people who say yes like i want that solution or yes i experienced that problem in the same way um so if like if your goal in building something is actually a profitable business which i think is what we're what we're after here so i think that that is a danger so um but i have i have a vision in my head for where i want to go with time and there's a set of features that i want and i want it to be a really awesome twitter tool generally so um stuff around like stuff around content stuff around multiple accounts uh stuff around managing your mentions all these are pains that i experience as a uh like as a you know i don't know power twitter user but i balance that with when i have something i want to build i will tweet about it i'll ask people hey does anybody else experience this thing do you have this problem put up a screenshot of something i'm working on if i release this as a as a feature would you want to use it stuff like that and and i get a lot of signal that way to make sure that i'm still on the right track yeah now that all makes good sense now you are bootstrapped and team of one today right correct any plans to raise or add more people to the team to speed up production no uh i am i am in chats with a fellow to partner up so i should i guess i should modify that um so we're planning on partnering up and releasing a native ios app um which we've been like test driving for a while and it's it's really awesome and i think that's that is a huge value add so this this fails a ios developer and so we'd be partnering on that how many people listening would go man he went 18 months not paying himself with a failed project and then he had some before that this one right now is up to 500 bucks a month i would love to do that but i can't live off 500 a month in revenue even if i took all that as just my own my own profits how have you sort of um modeled your personal life to give yourself this flexibility so uh this this is an important part of the story uh this is a side project i'm i work full time during the day when you when when do you cut bait when do you force yourself to go all in on chime um i think it's i think it's gonna be a while uh we live in a fairly expensive area i've got a wife and two kids so uh yeah i mean in the 15 000 mrr range that's where you need to get yeah and what what's the full-time gig what are you working out i'm a software engineer at a company called morning console okay very cool so so you're in the same world software development it's not like you're like an architect with a soft sas side project or something no no yeah yeah yeah i i'm a software developer there but the awesome thing about doing a side project especially as a kind of one person thing is that i'm thinking about marketing i'm thinking about distribution channels i'm like doing design and product development where you work in a you know a large software company you're more or less pigeon-holed into just like i just write software in my in my day job but with time social i get to do everything which is which is really fun spencer on that note let's wrap up with the famous five number one favorite book uh i would say april dunford's obviously awesome number two is there a ceo you're following or studying i'm i'm paying a lot of attention to damon chen his story on twitter he's doing some awesome stuff just quit his job and also april in halter uh she's doing some really cool stuff with tenderfoot number three what's your favorite online tool for building chime i'm a big fan of render what is it render.what render.com they're kind of like a simplified heroku interesting okay number four or uh how many hours of sleep are you getting tonight uh four to six four six kiddos it sounds like so you mentioned married how many kids two kids two kids okay and how old are you 31 31 last question what's something you wish you knew when you were 20 sales i wish i knew that when i was 32. so guys there you have it chime dot so broke his first 70 80 customers call it doing 400 500 bucks a month in revenue six thousand bucks an arr he's bootstrapped one man team launched back in january so nice growth first four months question is what will he do next will he ever stop the full-time gig and go all in on the side project for now though he's having fun building he's having fun catering to his users and buildings to ultimately for himself as the number one power either spencer thanks for taking us to the top thanks nathan one more thing before you go we have a brand new show every thursday at 1 pm central it's called shark tank for sas we call it deal or bust one founder comes on three hungry buyers they try and do a deal live and the founder shares back end dashboards their 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