How Fomo grew Fomo to $1.1M revenue and 5K customers in 2020.

you're gonna love this interview just got done editing it i'm glad i got it live for you i'll be in the comments for the next 30 minutes hanging out answering any questions you have in fact leave a comment below about data points or what you think is going to happen to the company and i will respond to every comment additionally if you're just loving the content click the thumbs up and i will go and check out your profile as well and give your videos some love as well in the meantime enjoy the interview hello everyone my guest today is ryan kulp he's a marketer and self-taught developer best known as founder of fomo.com he and his wife buy and grow small companies together at their micro private equity fund called fork equity ryan's been traveling full-time for two years and writes a data-driven travel blog at rickshawlabs.com all right ryan you ready to take us to the top let's do it all right so so you or the wife who who owns more uh equity in the private equity fund who gets more carry so we actually did 50 50 like the thing you're not supposed to ever do with an llc but we also did a will so we have some like like if she dies i get it all right got it otherwise it's sure that's fair okay so take this back to the beginning of this so so i i consider you kind of just a hustler and you happen to be in b2b sas and those are obviously good things what kind of got you into this in general maybe start with did you launch your own sas company back in the day back in the day i was a musician and then i got into marketing at a techstars company and that kind of just got me in the in the circle so i started freelancing i started doing agencies i worked in venture capital but always doing marketing always on b2b products and uh getting into ownership was just sort of like you know innately i wanted to be an owner one day i tried and failed multiple times with ventures and starting from scratch and then finally a mix of two things happened first was learning to program which i'm still obviously doing we're learning every day and the second half of that was being in the right place at the right time aka being lucky and having the opportunity to acquire a product that was already working and putting those two together in the last few years i've been able to like achieve more or find my groove more than all the years before it when i was like on the employee side of the table starting things from scratch and not being able to program so let's go back to the text marketing at the tech stars company what year was that and which company this was 2013 january 1st i joined a company called shuttlecloud uh they're still around they moved kind of to the enterprise so i didn't think my marketing was well marketing doesn't make a dent in an enterprise software so i i left that company and then jumped to a yc company called keychain uh logistics that was what year from cisco uh that was 2014. um moved back to 2014-15 to new york started a marketing agency called sprinkle labs yeah we did a mix of you know product marketing kind of whatever when you're an agency you just do whatever people do to be honest people always say like we're super focused on copywriting like no you don't you probably set up like google analytics for people if they ask right and then i moved back to san francisco in 2015 to work in venture capital while in venture capital discovery which firm notify uh growthx growthx.com and uh and then move back to new york city in 2016 2017. okay so 2017 moved to new york city sorry what was the company you discovered at growthx uh notify and it was notify app.io and it was a shopify app that showed recent orders we then took that rebuilt it and turned it into what's fomo today okay so so explain to me the cap table of fomo did you it was a growthx company that was struggling that you bought it and kind of rescued or how did that all work so i was doing the typical vc thing just reaching out to cool companies around town that i thought might want to take investment and the founder uh said no you know actually i'm not looking to raise i'm looking to sell uh i mentioned that to my buddy justin mayers just kind of in passing sometime that week like oh yeah like traction justin mayer's yeah attraction just demares yeah and he said well we should buy it um so together we we bought it i i mentioned this to the fund and they were interested in buying it as well and then kind of having me run it and be an employee at the fund but couldn't figure out the numbers to make it really interesting so just bought it as like a side project kept working full time at the fund and eventually went time phone so i mean what did you pay for notify app back in the day [Music] can i say you can give me a you can give me a range so you don't break any ndas or anything what's a range yeah six figures under a million fair enough okay got it uh and we did it with seller side financing which is a magic trick for all those who haven't tried it yet tell us how that works sure so seller side financing it's it's financing which means you don't have all the cash up front you pay it off over time except the financing quote-unquote isn't cash injection that you receive from like a bank with an interest rate it's uh like a loan of equity that you receive directly from the seller so if you're gonna buy a company for a hundred thousand dollars and you get seller side financing uh maybe you pay them ten thousand dollars a month for ten months but if it makes ten thousand dollars a month and you don't have an interest rate well in ten months the business is yours for essentially just your sweat as long as you kept it humming and didn't blow it up so we did a structure like that without interest without outside financiers the monthly payments were similar to the the revenue we were able to grow it just above board of our monthly service payments and then we introduced a clawback provision such that if two months went by and we didn't make payments the seller would get 100 of the company back and we did this for two reasons a we were young and fresh and like didn't have a how old how old were you oh well i suppose i was i was 26 but by young i mean uh i mean uh no track record right and so it's like saying hey you'll get the whole company back if we screw up at all was awesome because they would keep all the money have someone like running it for free and then get it back but the second reason we did the clawback was because we wanted 100 equity on day one so i didn't want it to be like a mortgage or like every month i owned three percent more in my house or something i wanted a 100 of it right now so we can make all the decisions not have the original seller have like voting rights or be on a board or anything like that so we get 100 now and you get 100 later if we screw up and obviously we we didn't screw up so yep well if there was a time when when for whatever reason revenue dipped or something you could pull into your personal finances and cover if you still believe in the product yes and actually that happened once not because the product wasn't growing we were just developing putting a lot into product i think that i think we each put in justin and i put in like fifteen hundred dollars one time maybe month four month seven because we barely overspent on dev so kind of say kind of a joke and then when we wanted to re-brand it and rebuild it from scratch as fomo well that's a lot more than like uh maintenance work for dev we needed let's say 50 grand to build that new mvp so what did we do we just got a chase credit card 12 month zero percent apr interest and i think we put like 70 or 80 g's on that card and then like month 10 of the uh of the accrual we paid that off in full so again paid no interest and essentially did like a 80 000 raise with no interest in addition to the seller side financing what did you provide chase that enabled them to basically approve you for you know no interest 80 grand on a credit card that's a good question i mean we both had jobs and salaries like i think my my venture salary was well into six figures at the time so that combined with like history although i didn't have a chase account already i wasn't banking with him personally but yeah it was like i think we got approved for 90k uh on day one for the chase like ink card so was it like it was probably no interest for first 12 months but then it was like ridiculous interest if you after month 12. either 16 18 20 22 something like that and it's actually not that bad yeah i mean it would have yeah i mean look if you paid off month 14 and then you pay eight thousand dollars the difference between not making not getting any dollars and paying 8k above is nothing yep yeah okay so you did this uh you did this back then i notified how did you know that notify app was the right one to go after i mean you talked to hundreds of companies uh i can't say i really knew right i had conviction but that's not the same as knowledge as a marketer i looked at notify and uh this is a cool tool right that's like what marketers love to find cool...