How Yac CEO Justin Mitchell grew Yac to $1.4M revenue and 1K customers in 2024.

hello everyone my guest today is justin mitchell he's the founder and ceo at yak he also builds products at so friendly.com and runs newton mail now justin you're ready to take it to the top yeah absolutely so i'm a yak power user for people that have not used it before describe how it works yeah so yak is asynchronous meetings so the goal with yak is to have such rich communication throughout the day that you just don't have to have those you know long hour long zoom meetings throughout the day back to back you're just communicating over voice through asynchronous voice messages you can attach your screen you can do a video maybe even a selfie vid with your webcam you're sending that off to your team you know the biggest differentiator here is kind of the social graph side of it right so instead of this being content that you're creating and you're putting on a help site somewhere or you're sending in an email you're dumping into your slack all the actual communication happens inside of yak so it's back and forth it's conversational you know this isn't for creators and viewers this is just for back and forth between teammates right and a lot of times that extends into who you talk to professionally as well right whether that's investors or a contractor that you just hired it's back and forth it's voice it's all recorded it respects both people's times because i can send it when i'm free and they can listen when they become free and that's kind of the the long and the short of it yep um and so and so help me understand uh business model how do you guys make money so you can pay more engineers and build product faster yeah so it's you know similar to slacks you got a free tier you know we really learned early on that a lot of people were using this kind of personally at a professional level like i said a freelancer talking to their clients or a startup founder talking to investors or even a coach or a mentor talking to their students and that kind of like one-to-many aspect with one person who's doing the majority of the communication talking to a lot of people we definitely allow you to do for free and that enables things like um you know non-profits and communities to kind of run for free on yak now as soon as you want to upgrade to a team plan you get things like our slack integration group messaging better transcription insights we actually pull out action items and to-do's from the transcription all that stuff's on the paid plan and we've got standard annual and monthly you know we started out with like three different plans and that was just confusing when was that really distinguished what year was that when did you launch uh so we officially launched in uh 2019 but uh the app was actually built november of 2018 as kind of a free hackathon project put it out there and the reaction was really good and so we decided to spin it off as its own venture back startup so before we get to some of the backstory and how you got to where you are so so today just your paid cohort what are folks paneling average per month to use that those extra features yeah so annually you're paying three dollars a user monthly you're paying five dollars a user and you know average team size is somewhere between like eight and ten upwards to maybe 45 depending on kind of like the use case so we have a couple of vcs that are actually using it to talk to all of their portfolio companies and those are like 45 50 people in those teams yeah okay interesting so now let's go back to the back story so you you do this at a hackathon you get it going how did you your first hundred free users using this thing yeah i mean i i talk about this a lot it's one of my favorite stories of yak's kind of genesis is writing the coattails of somebody else's marketing efforts uh i've always been really big on not putting money into ads finding creative other ways to find users and for us that meant you know utilizing product hunt's existing audience you know that's startups it's makers it's designers developers it's exactly who we were trying to target so from a audience perspective it worked out really great for us so we submitted this to the hackathon specifically with the explicit idea of we will win the hackathon because we're really good builders we know how to make something that looks good and once we do that will be free press for our design agency so friendly which was really the idea at the time was let's get you know use this as a marketing funnel um you know get featured by them and then people will come in and find out who built it and they'll hire us that was kind of the idea so yeah we really just kind of leveraged their audience they put us in their newsletter they put us on their medium blog they tweeted about us but it's on their facebook and then we won the hackathons we were on the home page of their website and all of that resulted in thousands of people coming into the funnel for free we didn't have to pay for any of that you know we paid i don't know i guess contractors and a couple developers on our own team for like four days of work to actually build the product out but we'd have to pay for any of this like newsletter sponsorship we're just featured for free because we did a good job and by doing a good job in their hackathon we were obviously promoting their brand and justin when did you when did you post this on product hunt for the first time yak yeah so the makers festival was thanksgiving 2018 so it's like november 28th why can't i find it when i go to your profile and look at what you've made it's i can't there's nothing listed was a different name no uh so the original almost all the way down you might find yelling across cubicles which was what yak actually stands for oh interesting okay i can't oh yelling across cubicle oh that's hysterical i didn't know that okay so you posted this back in december of 2018 you got 429 upvotes um how many how much do you remember how much like website traffic how many signups this drove yeah so i mean that resulted in probably um a thousand signups um downloads really you know let's translate it into downloads um you know i think we probably had at peak maybe like 500 people using the app on the kind of a weekly basis i mean admittedly at this part it was not that great right it was definitely a hackathon project so i was surprised that many people actually got it up and running and a lot of them were in like weird industries we didn't expect either like roche healthcare like kind of an enterprise healthcare company not a fun you know remote first startup um so yeah they just found out about it through product hunt downloaded the app and started using it in their team now fast forward you just published in march of 2020 an updated version that's yak it's beautiful number two product of the day 758 up votes was this as successful as the first one and driving you new users and customers oh yeah absolutely yeah i mean the every time we post it's been really you know good we've had a pretty good rubric for success in terms of like how we do a product hunt launch um and you know the upvotes never translates one-to-one with um what you see traffic-wise to the site 2020 how many um did you get when you posted it yeah so we typically see on like a launch day around 2500 um you know visits to the site it translates into you know probably i don't know 500 some odd users coming in when we launched in march we had 900 new teams sign up that week so i can't tell you what we did launch day but that week we had 900 new teams and those are teams right so those consist of typically three to five people on the low end um so you know it was a big launch for us for sure definitely boosted our numbers up yeah okay so then then fast forward today i mean what do you guys track more number of teams or number of seats in the teams yeah so really we're trying to look at growth in a team so we want to see a team start out with three four people you know expand out to five seven you know eight people and then move up to maybe that 15 number which we think is a good sweet spot for kind of like a larger team um and we're really that's kind of our focus in q1 of this next year is going to be going into existing teams and saying what features are you missing or why aren't you on boarding more people how can we help you get more people because we already have really kind of the mass adoption from multiple companies we want to see those existing teams grow and obviously that means that that results in hey you hit a peak or you hit a usage um you know top out where now you need to upgrade and pay as well so instead of doing like cold call sales and trying to reach new companies we're really trying to go into the existing teams that are using the product saying hey how do we scale this oh we didn't even know that group messaging existed or we didn't even know a slack you know bot was an option and so now that we have these features we're going to go back out to them and say great so upgrade to the teams plan will activate that slack integration for you so how many active teams you have today and how do you define active yeah so active we define as basically an every other day usage because it's a meeting tool right and so we don't necessarily always see daily usage out of each team especially dipping around...