Episode Transcript
Speaker 0 00:00 <inaudible>
Speaker 1 00:03 <inaudible>
Speaker 2 00:08 come to the breakout growth podcast where Sean Ellis interviews leaders from the world's fastest growing companies to get to the heart of what's really driving their growth. And now here's your host, Sean Ellis.
Speaker 3 00:24 All right. In this episode, we're going to be looking at a fast growing market place called gen M. so they're a marketplace that connects students with businesses and the students are able to get some real world experience and mentorship and the businesses get some free marketing help from the students. So their business model is that, that the business is paying $49 a month, and they generally bring in an apprentice for about a three month program. And that apprentice is hopefully getting the experience and the training they need to be successful in the workplace on the backend system seems to be working pretty well. They've, uh, they've attracted over 30,000 businesses to the platform and over 60,000 students to the platform, and they're continuing to grow at a, at a really fast pace. So in this interview I'm going to be talking to their CEO, mow our boss, and really try and understand what they're doing to drive that breakout growth or if, you know, maybe it's just great market conditions and, and really that the need is big out there. But what my, my thinking is that it's probably everything from the market conditions to how they're executing and uh, and just driving improvement across that full growth engine. So we'll dig into all of that, try to get a really good understanding of how they're growing and hopefully we'll get a couple of ideas and how they can be doing even better through, through the conversation. So let's get started.
Speaker 3 01:49 Welcome to the breakout growth podcast. Mo, I'm really excited to have you on the show.
Speaker 4 01:53 Thank you very much, Sean. It's great to be.
Speaker 3 01:55 Yeah, I mean one of the things that I find really interesting with your business is that it is a marketplace which it's notoriously difficult to get market places up and running and working. What do you think has been the most important success factors in gen M's success to date?
Speaker 4 02:11 There's two things. One is solving the marketplace chicken and egg problem, which is different thing, but overall our success quite frankly comes down to product market fit. It's a very elusive thing. It's very difficult to find. It's like the Holy grail of startups. When you do find it, you become a real business and then you move on to the next phase, which is generally distribution fit
Speaker 3 02:34 and so for the product market fit, was it something that that you got pretty lucky right out of the gate or did you have to do a lot of iteration to hone in on it?
Speaker 4 02:42 You always have to do iterations, but honestly most people would've quit way earlier because it wasn't so obvious and the products were not sticking and the only reason we stuck through it in the iterations is because I had worked with students for over a decade. Helping them launch a career is providing them job training as a small business owner. So I personally knew the value of this myself. Trying to find a product to enable this or build a product that was really, really difficult. It took a long time for us to really nail it to find that product market fit and the only reason we persevere was because we had the unique insight of a decade that that's only found through a decade of experience solving this exact problem peripherally.
Speaker 3 03:30 Did you have a vision in the beginning that was pretty close to where it is now or did it really as you understood the market more and tried things that vision took shape,
Speaker 4 03:38 so we had this vision that small business owners, entrepreneurs, essentially you could train students for the job market. That's the whole premise of the company. We built experience-based digital apprenticeships off that hypothesis. That's always been the vision of creating this global scale system where anyone could get access to skills, experience and ultimately jobs. The vision has been pretty consistent doc, so we've, we've obviously flushed it out and what does that look like in 10 years? You know, make it more simple, make it more obvious. It's kind of hard to believe sometimes for yourself, such a grand vision. Earlier on it was just like, Hey, maybe we can kind of do this. We didn't really understand the true scale that could have. I think earlier we were kind of naive to that, like this could be a really, really big thing that impacts millions of people around the world and earlier on it was just like seem kind of like this far fetched wishy washy thing that could happen. It was the same kind of idea, but as you started building and getting it in actually works and you keep adding to it and you're building your team out on the product I like wow. Becomes almost inevitable. It goes from this like idea pie in the sky to an inevitable outcome.
Speaker 3 04:51 Right. When you start to get all of those proof points as you've built that team, has that been a big part of attracting people that were excited about that mission and the and the vision that you've been working toward? Or is it something that the more involved they get more excited over time?
Speaker 4 05:06 Earlier on? There's no proof to it. You know how a lot of clients, like there's not a lot of apprenticeships happening and it's just like, what could you sell as a charismatic founder, right? And then once you start to working, you have all these proof points, you hire a lot of smart people, and then the mission becomes more clear. You clarify your, your KPIs and your mission, and you have a lot of proof points and social proof behind that. Then you off to people, you know, well, what do you want to do with your life, right? When you're recruiting, it's like, do you want to go build more enterprise SAS tools to help people sell software that other people may or may not need? Or do you want to help change the lives of people around the world providing them skills regardless of the social economic status? Do you wanna be part of a legacy company that's just in its infancy, that's going to have a major impact positively in the world? Or do you want to sell whatever it is? And that's become very compelling mission to a lot of people.
Speaker 3 06:04 Yeah. Well, I think especially people who are relatively young coming out of school, idealistic, they really want to be doing something that's meaningful and important. So I could see that being a really attractive pitch.
Speaker 4 06:16 Yeah, it is early on, very much very young team. But what happens is, you know as you start building and you get these really smart people, then you start attracting maybe one really high level person, which you've managed to do and then a high level person becomes a proof point, more proof points to get even more high level of people. And the mission is just, it's such a tremendous advantage to start up to work on something that has a positive impact. Because I'm telling you like when you're competing with other companies for recruiting and your mission is very compelling, it just makes it so much easier to attract that best talent.
Speaker 3 06:54 So you just talked about impact. How do you actually know that you're making impact? Is there a metric a, as a teen that you track that gives you insight into the impact you're making?
Speaker 4 07:05 Yeah, absolutely. So for us, if we're making impact, it means that there's an active apprenticeship happening. So that's our main KPI that we track. Obviously we generate revenues well, so MRR, all the KPIs around MRR are important, but the outcomes are generated from active apprenticeships. If there's an apprenticeship happening, it means by candidates is getting trained in a business is getting value. So that's what we optimize for.
Speaker 3 07:32 So that's something like a weekly active apprenticeships or something like that?
Speaker 4 07:36 Yeah, I mean we check it out every day. Um, but you can, the week on week growth makes sense.
Speaker 3 07:41 So that would be considered like a North star metric that, that the team is looking at all the time. Yes. One of the things that really jumped out at me was some of the language that you chose. So you've referred to apprenticeships a few times and I know in my own experience I have, I've never really thought of it as an apprenticeship. I think of it much more as an internship. I feel like your choice to use the word apprenticeships pretty, pretty brilliant on the business. I'm curious how important you think that language has been to your success and how you decided on that
Speaker 4 08:09 super important languages is interesting. Like if you asked Shakespeare, you know he says a Rose by any other name smells sweet, right? And then on the flip side of that, you know whenever somebody says a word, you have instant imagery that's associated with that with you. Like it or not works are very, very, very powerful. With that in mind, we looked at internships. I don't like the word internship. I don't like to type of relationship that is governed through an internship, especially with an unpaid internship. The problem with unpaid internships is the relationship. This is the core, right? When you boil it down, you have to look at the core interactions that are happening and what's going on there. So with the internship or unpaid internship, the relationship, the fundamental relationship is between a student generally and a corporation. It is a human being to a entity relationship.
Speaker 4 09:05 So unpaid interns and interns, they go into a business and they often don't have anybody that they are directly mentoring under. It's unstructured, it's unrelated to their vocation. Does, you know often you're doing things that there's just not related to them getting a good training experience. And there's really no system, there's no regulations. It's, it's them in a corporation and it's very limited amount of corporations they can pick from. It's a bad situation for both sides, but mostly for the student. So we saw this and we're like, man, do we really want to create this kind of behavior? No, we don't. We don't want to put a mask up between the apprentice and ultimately who they're going to be working with. So for us, early on we picked the, apprenticeships was probably like 40 50 hours of conversations had on this before making this decision from the core relationship.
Speaker 4 09:58 You have a human to human relationship, right? Fundamentally different than a human entity. You may think it's an odd, it's not a big deal. It is a big deal. It really, really is a big deal. And then what happens then is there becomes ownership. There's a human being that now owns the training of this student and you know how important ownership is in, in any kind of company or any kind of team really. Right. So now I as an entrepreneur, am responsible for training this person, not my business is an unbusy and they figured out, I don't know who they report to. So that was one key thing. And then the idea behind an apprenticeship and apprenticeship is a centuries old. It's not new as an old term. It is the first and longest and most effective form of job training that we've ever come up with. Okay. Then nothing's been more effective than apprenticeships back in the day. That used to be, I provide you food and housing, you apprentice under me, I don't pay you because I'm giving you food and housing. You learn my craft. Then you become a master and you bring on an apprentice, you can go start your family, you can start, cause now you can charge. So that's why we chose the word apprentice. It's just a lot of history and it's the right kind of relationship and right kind of behavior.
Speaker 3 11:12 Yeah. I love it. And then I thought it was really interesting on the onboarding for a business before they can pay you money. They actually make them commit to some of the things you just talked about there that they, that they need to actually be willing to mentor and help and train the student. I thought that was really <inaudible>. Cool.
Speaker 4 11:29 Yeah, that was really important to us. Ultimately businesses are getting unpaid labor. You can like, you know, make it pretty, are they getting help? Really what it is, they're getting help growing their business. If you look at the naysayers are going to say it's unpaid labor, which you know for us we take that very, very seriously. We've regulated what is unpaid internships are so totally unripe. We've regulated this and part of this process is ensuring the businesses that come onto the platform are ready to train an apprentice and you know, there's a lot more than that. Do they have some level of marketing knowledge and experience they can actually transfer down to the apprentice? Like can they look at the work and provide feedback to that? Are they willing to provide that feedback? Right? Are you going to be okay with talking to the apprentice and giving them that one-on-one, you know, once a week or whatever it may be.
Speaker 4 12:19 Because this isn't about unpaid labor. This is not what we're about. Sure, you're going to get the value of the help, but it's a has to be a fair exchange of value. If they help you, you must provide them value back. Mind you, most human beings by law, by the law of reciprocation, the human law, you cannot get around this. It's embedded in our behavior will reciprocate that help and provide the training, but we've got to make that very explicit and clear and that that's just one actually of many, many things we do to ensure that the relationship is focused on training.
Speaker 3 12:53 I can feel as we're talking through this, the, the passion you have for this opportunity and for the business, and I think that's such a, an important ingredient in building something big and meaningful. Obviously execution is another big part of how you make that happen. So I'm, I'm curious how you've built your organization to support growth. I guess the starting point is do you feel like the overall team thinks a lot about growth or is it more just a select few people?
Speaker 4 13:18 No, I mean growth is now cross functional cross departmental. Like our growth team actually needs our engineering team to help them or design team to help them. I have a student business side growth teams, they switch focuses and help each other depending on which side needs the help growth as a function of product. It's a function of of of teams. It's a function of dynamic of what you set as goals for the company. If you are a real startup, a real startup goes very, very quickly. Growth being the key word there. So you have to build the organization to blitz scale.
Speaker 3 13:53 How has the organization evolved over time?
Speaker 4 13:56 I mean early on it was me and my co founders and we can build anything ourselves right to, you know, like it was just a small team. As you start, you know, getting more and more users. You started getting more departments, you started getting more people, then you're going to start creating structures and processes and then systems to enable the growth to continue and most importantly actually it's communication. So it's aligning the right goals and ensuring that everybody that's communicated across the board and then from there you just hire the smartest people. You've got the smartest but the best people you can.
Speaker 3 14:29 One of the things I noticed is that you actually have some people on your team from Shopify, which makes sense because especially when you're not in Silicon Valley, it's hard to find people who've been on a high growth journey, so it's really helpful to have Shopify as a, as a local company with you there. How else have you been able to kind of develop the skills?
Speaker 4 14:48 Generally you want to hire people who have the skills. I'll usually, in some situations, you'll hire very high potential people that can learn very quickly. I don't mean you hire for experience. You generally hire very intelligent people who could grow and learn whatever it is you need them to learn very quickly. But they do have experience in marketing, right? So like they don't have to be super proficient in one, like one area of marketing and they put them in a box. They need to have an understanding of how marketing works per se, uh, in great detail. And usually those people, you can put them on any kind of distribution channel and they'll figure it out because they have the baseline skill of understanding how the customer thinks from a marketing perspective. And that just takes too long to train, frankly. Like a smart person can learn how to launch an affiliate program fairly quickly, but they can't learn how to market effectively very quickly. That baseline knowledge is just too big of a learning curve. The specific knowledge could be learned very quickly though.
Speaker 3 15:49 So you said that you have a growth team. How do they fit in with the broader organization? So do you have like a separate marketing team and a growth team or do they sit inside the product team? Let's sort of the structure there.
Speaker 4 16:02 Yeah, so the student side growth team and a business side growth team and they both operate independently like they have their own OKR is the need to achieve a, we use Oak <inaudible> as a business as a whole. Uh, their objective and key results. It's a really good framework. Uh, it takes a while to implement very valuable longterm. So they have their no KRS. Uh, they sit beside each other, they collaborate with each other cause you know, if, if you have a market on the business and students side that are doing a similar function, they can share knowledge about what works and doesn't work. There's a lot of knowledge transfer. I put people within eight meters of each other. Each team is with eight meters of each other, each function, uh, we're an open office. You can literally walk, not even walk. You can poke your head up even and talk to the engineering team or the customer success team or anybody on the marketing team. That's just how it's laid out right now. As it gets bigger, it gets a little trickier to do that. Where you sit. People as, as silly as it may sound, is probably one of the most important decisions you can make as to how people collaborate with each other and that's what you want. You want cross departmental collaboration.
Speaker 3 17:09 Yeah, and that's one of the things that I feel like that you give up with remote teams for example, so that's you. You really have to take advantage of having, having everybody in the office. That makes, that makes a lot of sense. You've kind of gone back and forth between calling it a marketing team and a growth team. Do you kind of distinguish any difference in your mind?
Speaker 4 17:25 No, I don't.
Speaker 3 17:27 It's a rip, but people are responsible for growing the business.
Speaker 4 17:30 Exactly right, so you can call them growth team, call them marketing teams. It's pretty much the same. I don't really know the differences between the two. I mean, at least in my eyes, marketing's job is to grow the organization.
Speaker 3 17:42 I definitely think it should be. I think a, a lot of times marketing has been more about channels and brand and sort of the external stuff where a lot of the growth levers, they're kind of deeper and product are controlled by a product team. And so
Speaker 4 17:57 maybe when we become a much bigger organization you can separate the two into like a more refined type of structure. I think that's a long way away from where we are today.
Speaker 3 18:09 I'm personally much more about what are people doing and what are they trying to achieve as opposed to, what do you call them? You've got everyone organized in a really effective way on, on the kind of supply and demand side of the marketplace. And I guess maybe it's not supply and demand, it's the the businesses and the students. I'm not sure which one.
Speaker 4 18:27 So I was surprised to find a man. Yeah, it's kinda hard to figure it out. I would actually consider the businesses to apply and the students to men, other people may say no, businesses are paying, so they're the demand. But like businesses are the ones who are training. They're like the hosts in Airbnb. Right. Who also actually pay a percentage. So in my eyes, they're the supply and this, and then the apprentices are the, uh, the demand.
Speaker 3 18:51 So let's look at the overall growth engine now and knowing that you've got different parts of the organizations that, that layer across this growth engine on the acquisition side, how do most people discover gen M? Now
Speaker 4 19:03 on the business side, it's pretty refined, pretty simple too. There's pretty significant channels. Uh, like most businesses, there's a few channels that work really well. Referrals do really well for us. So we have a strong referral campaign. Uh, we're updating that right now actually as we speak. We keep iterating that making it more and more refined and better.
Speaker 3 19:24 Is that the affiliate program?
Speaker 4 19:26 It's a little different than the affiliate program, but they're very much so referrals is like internal members referring other members. They don't really do this. Like it's not their, it's not their job. It's not, they don't put a lot of like they're doing it ultimately to gain lifetime free access or a small monetary reward. Affiliates are like professional marketers usually who have systems in place to market other brands. This is what their business model is predicated off of. Some members of gen M can become affiliates. So usually referrals are smaller time people, affiliates are bigger time people. So that's how I look at the two functions. And they're different from each other to a foods can be external, totally external referrals all come from within Jenna. And then the other one is odds. So we do, we do ads, we do Facebook ads, we're trying a few different ad platforms right now as well.
Speaker 4 20:19 They work well, but I'm not a huge fan of ads. They do work well. It's not something you want to do forever per se. They do work right. So it's a way of, you can, you know, ultimately it's about talking to your audience and ad clot forms, know how to aggregate audiences and they charge you to talk to them. So it's just a matter of whether you can get good unit economics on them. And the odd plot from this job is to make the unit economics as bad as they possibly can for you, but just good enough that you could keep paying. Yeah,
Speaker 3 20:54 keep you addicted and make as much money in the meantime.
Speaker 4 20:59 That's the three. So it's referrals, affiliates and ads and we do, we do partnerships, so partnerships and sponsorships as well. I guess you can count that as a third. There are a component of that. So we'll partner with like, you know, whether it's social media examiner, whatever may be a STO, you know, we do get found organically quite a bit. Uh, now growing as well. We don't do any PR, we don't do any kind of noise banging of the drums yet. Not something we put a lot of effort on and we chose to really do much more direct talking to customers rather than, you know, carpet bombing. Initially it was actually like more like a sniper and then it became like a machine gun and eventually you could probably carpet bomb as you figured out how to do that with a little bit of precision.
Speaker 3 21:47 What would be an example of a type of keyword that would be helpful for you?
Speaker 4 21:52 Marketing help on the business side? On the student side is a lot more obvious cause the intense is a lot, lot,
Speaker 3 21:58 lot more around learning I assume.
Speaker 4 22:01 Yeah. Like they like there's a specific problem like people have marketing problem, like they try to find solutions for that in many different ways. When you can't get a job as a candidate, you can call them students and all students actually it's actually becoming a smaller and smaller demographic. Like our demographics include students, recent graduates, people who are switching careers, people who are getting through the career into their first career, right? Whether it's a stay at home mom or, and then actually even marketers who want to learn a new scale is actually also a really big demographic.
Speaker 3 22:31 But either way it's still students if they're learning. So
Speaker 4 22:34 yeah, you can call them learning a students if they're learning. So on that end it's, it's very, it's much more different. It's a little more varied. We have partnership to the largest marketing course provider in North America to charge a lot of students to us cause they learn marketing but they don't got any experience. They come to us to actually get the hands on portion. Uh, from these course providers. We've had partnerships with different schools. The schools know that they don't provide good work experience. It's a big problem for schools. So the smarter ones how to solve that problem, although it still doesn't make the value of a degree and not much better, it is better. Um, so we do have some school partnerships. SEO is another one. App store optimization. Uh, we were ranked in the education marketplace in the app store and you know, we've got featured a few times while it's kinda a little more varied on the student's side.
Speaker 3 23:29 And then one of the things that that jumped out as you were mentioning that you work with a course providers. Are you doing your own courses cause I see courses promoted on, on the platform or are you licensing that content?
Speaker 4 23:42 No, we built our own courses. We only built our own courses because the methodology that a lot of other platform used was we found it to be ineffective. So we took their content, you know, whatever it is. Uh, and we made it into micro learning, which is essentially kind of like flashcards. So you can take like an hour of video and make it into like a 10 minute flashcard lesson with the same content, right? But without all the other, you know, wasted words and gestures and motions that are, it's incredible. If you're looking just for content, like the information is a Cole's notes, we just summed it up, made it really easy to digest. You don't have to go through the whole hour video to get those five points that either really speaking.
Speaker 3 24:29 And the truth is you learn by doing anyway, so you're providing that side of it.
Speaker 4 24:34 That being said, okay, we do see ourselves partnering with content providers to scale up our content, especially as we get into multiple verticals. The content is a commodity, in my opinion, show them our methodology a little bit better than some providers. But you know, if we can provide a massive content library for our apprentices to get the theoretical knowledge which they could take and then apply for actual work experience, we believe that to be more valuable than anything else.
Speaker 3 25:03 Yeah, it almost feels like, um, as a reference resource as they're doing the job to be able to get access to it. But I did notice that people can feature the courses on their profile that they've taken and I would assume that would make them more valuable to businesses.
Speaker 4 25:19 Yeah, you can imagine. So you can, on our, on our plot form, we, you can see all of these training that a student's completed on gen ed, um, which gives you a better idea of what kind of knowledge they have when you're bringing them on as an apprentice. So it helps qualify and build better matches as well.
Speaker 3 25:37 So let's, let's look at the activation part of the growth engine. When is someone really acquired at this point, both on the, on the business and students side, what kind of action do you see them doing to where they become? Let's look at the student side first, where they become someone who consistently does apprenticeships.
Speaker 4 25:55 So there's a few key actions. One is they become a discoverable student. So there's a funnel they have to complete. They're going to sign up, they've got to complete a profile, they've got to do a quick little application to the marketplace, and then they have to have intent to get into an apprenticeship, which they toggle on or off. And if it's on and they filled all the other stuff and they were responsive, then they are discoverable in the marketplace. Right? On the business side, it's if they're paying us, right, they're an active member is a key metric. But the main one really is, are the, in an active apprenticeship. Like I can give you a lot of other metrics, but the key question is where is the value driver? Right? Why are people coming here, uh, coming here to get an apprenticeship? So if they're active apprenticeship, you're getting the value of your product.
Speaker 3 26:47 I did see that when the businesses are going in and signing up that they, it's not obvious they can do it, but if they dismiss that, that payment box on the onboarding that they are able to browse students, I assume when they try to contact them, that's when they're given a prompt to to purchase.
Speaker 4 27:02 Exactly.
Speaker 3 27:03 And then I also saw that with that flow that there's prompts to contact, uh, I don't remember what you called it there, but book a call or something.
Speaker 4 27:13 Yeah. With our onboarding team.
Speaker 3 27:16 Do you find that a lot of the new businesses have to go through that, that touch process or, or are the majority of them able to, to get there is through just the normal e-commerce flow?
Speaker 4 27:26 I mean, early on it was you had to go through an onboarding specialist because our product was not developed to the point where you'd understand how to use it that well. Right. So you had to talk to somebody. As we built the product out to be better and better, it became less and less important, but still important to a lot of people who just may have a few questions before they want to activate. It's not a quick call. It's usually very short call with our onboarding team and just help them get set up for success, which is really, really important for us
Speaker 3 27:52 and knows you do collect the phone number in the flow. Do you do any outbound to them once you've collected that phone number?
Speaker 4 27:59 Here's the thing. Without onboarding flow, it is constantly, and I mean almost every single day being changed, right? We literally have tests being run, like does it, we're having any tests right now where we're going to remove the phone number because it's an additional friction point. There's another test where they're not even going to get to go into the marketplace. They're going to have to pay before they become members and they'll see a video of the product before it's a whole other test, right? So we don't know what is the best way of getting an active member, a good active member. Right. When we enter into an apprenticeship, we don't know. We have ideas that work to different degrees. To answer your first point about the phone number, we don't necessarily use that to engage them to becoming a member, although that's probably a good idea. We'll use it to get them to engage with the product, download the app, et cetera. But that's a great point. Maybe I'll mention that to the murky team.
Speaker 3 28:58 I think the important part is what you just touched on is that you're constantly testing and so ideas can kind of come from anywhere. It's through that testing that you learn what works better and and constantly trying to improve your, your signup to number of businesses who hire apprentices. And, and on the other side, the number of students who sign up who actually become apprentices and, and all of that testing is, is how you keep driving the improvement. So it sounds like you're doing great with that and I'm not not surprised given your overall growth numbers, that that testing's a big part of how you've gotten there. Before we kind of go into the process on, on how you run that testing. I wanted to look a little bit on the revenue side. I saw right now you charge about $50 per month for businesses. Students don't pay, but they're paying with their time. As you said, it's a fair exchange there. How did you arrive at the business model where where the businesses are paying a subscription fee and it's free for the students?
Speaker 4 29:58 For the students. We actually started from first principles asking ourselves is it possible to create a free education system? And we ended up focusing on job training, you know, which is the main main reason why a lot of people go to school. We ask ourselves what's really involved in it, right? There's a content, there's the teaching aspect, there is a certification aspect and there's the, you know, the social proof that you have this kind of knowledge that can be employable. Right? So when we were looking pregnant at the price point, it was really hard to make it free. It really, really was. We, you know, we raked our heads for a long time. How do you really make it free for the students? Right. We actually charged students in the past and we didn't like it. It just, it didn't sit well with us and it took a while to figure out how do you like align incentives properly between businesses and students to make it free for them. And ultimately it was just exchange of value where they can trade skills for help. We said that, you know, these students I like, we know they're volunteered. Like we took on a whole bunch of ourselves. They have time, they all love learning like they will, they like nobody pays you to go to school. You go to school for four years of your life, nobody pays you.
Speaker 3 31:14 Yeah. Well and in the United States you pay a hell of a lot to go to school as my, as my daughter's going to college now when I get that bill, I know it
Speaker 4 31:22 exactly. So it costs a lot of money. It takes a lot of time and there's no guarantee of a job. It's got terrible outcomes for a lot of people that depending what you take and where do you go. So you look at this and you're like, man, so people are willing to volunteer time for training. This is what they do in schools. This is not new. So we knew that they, they are willing to do this. It's something. And we also had our own experience of course. Right? And then on the business side it was like, huh, we actually try different price points and I'm not saying $49 is the best price point. Okay? There's a reason why we leave it for now, but we did try $249 and you know what happened? The relationship changed. It turned into an employee, employer type of relationship. And the business was like, man, I'm paying a lot of money. I'm an entrepreneur, is a lot of money to me.
Speaker 3 32:12 I better get my money's worth.
Speaker 4 32:13 It's still not that much, right compared to pay on wages. But these are the entrepreneurs. They're not like, you know, big companies. They're small businesses or startups usually for them $249 a month, a lot of money. And they were like, you know, I've got to get my deliverables on that and I'm like, wait a second. That changes the incentives.
Speaker 3 32:31 Right. I totally get that. That makes a ton of sense.
Speaker 4 32:33 And then you made it free and then we tried free and then what happened then is the businesses didn't care. They were just like, yeah, it's free. Yeah, maybe
Speaker 3 32:42 the game,
Speaker 4 32:43 no skin in the game. It was just like whatever. Maybe I'll mentor if I feel like it. And like it just wasn't, again, the incentives are not aligned. And then we went to a $49 a month. We actually tried $79 and $99 so we know we could actually increase the price point without any change in the marketplace dynamics. And the reason we don't do that right now because we're not optimizing for revenue, it's not at all or optimizing for. We ended up selling a $400 we felt that was low enough that anybody would try it as an entrepreneur but not so low that they wouldn't care about it. It was just kind of the sweet spot and I think we can go all the way up to $79 and still be okay in that.
Speaker 3 33:25 That price point made it even attractive for me as I went through and thought, gosh, this I have a lot to offer a an apprentice in terms of skill transfer and I'm sure I could use some help and I agree up to 79 that also makes sense. And then when you get into the several hundreds of dollars, the dynamic would change to where you have to get your money's worth and it's less about helping through training. Cool. So then you talked about on the activation side of things that you've done a lot of testing to drive that improvement, I assume on the, for this revenue it's a little harder to do that in kind of a scientific way. It's more gut to some degree and maybe a bit of testing and honing in on it. I'm just curious how you've gone about sort of deciding where to run scientific testing and where not to and and what sort of, which parts of the customer journey that you're doing testing right now?
Speaker 4 34:18 I mean earlier on it was just more about what we felt was the best for the product. Wasn't that scientific. We became a lot more scientific. I think almost everything now is run scientifically. I don't know any tests that's being run that does not have a KPI it needs to affect. So if you run a test as the scientific method, right? So you have a hypothesis, uh, you know, we believe that by changing this button we're going to increase conversions by 14% and then this is the data you're going to be tracking and you actually eat to run it for an a meaningful way. So you have to have enough, it runs for a week or affects a hundred people to get enough data to make it a meaningful judgement. And your whole goal with the tests. You only have one goal is to make a judgment and a decision.
Speaker 4 35:00 That's it. Do you persevere or do you pivot? You continue with this test, does it work? Does it not work? So we changed something as simple as on the payment wall. It was a test that, Hey, if you remove the review of their, of their costs, I'm like you, you put in the credit card and you pay now, and then the test before was you get to review your payment and then you press the button and then the payment runs through and it was like that's the, the hypothesis was that by reducing the steps to payment, you will get more members to convert. Right. It seems to make sense. Great. Makes a lot of sense. Run that test before you even a test. You got to have an argument. There has to be like, no, I don't believe this is the risks and need to go in knowing what the risks are of that test.
Speaker 4 35:45 But then you run the test. You have to let them know if the person's still after that argument, who's championed test wants to run it because they have data that shows that equity work. You have to let them run the test. Okay. If it's a really expensive tests, you got to figure out how to run an MDP version. Okay. But I'll give you back to that example. So remove the confirmation page on the payment and it actually decreased conversions, which really shocked us because we thought it would increase conversions. So within one week we let that run for one week and when we reverted it back to the way it was, okay, that was a failed test. So when you are running these tests, you know you really need to figure out what is the simplest way of running this test. Do I really want to spend?
Speaker 4 36:29 And I see this all the time and we used to run into this risk and not any more frankly, cause we just, nobody has the bandwidth. And we always had to figure out an easy way of running tests. But you can't be doing like an end a week of engineering work to run a simple test where you know, maybe instead of changing the whole model of a paywall, you just change the content of it and leave the modal and see what that looks like. And another thing we used to do, which was a mistake, is we changed like four or five things at the same time and it was really hard to figure out what was actually the cause of the results. It was really, really hard. So now we're a little more deliberate in the K we gotta change this one thing, run the test if we change multiple things, like we know there's a risk involved in that. Sometimes we do it, although I like to think that, you know, you're right a lot of the time, like who would have thought that removing the review would decrease conversions? I would've put money on that. I think not. It makes total sense. Right?
Speaker 3 37:26 Exactly. Exactly. That's why you tested it. If it was obvious you wouldn't even need the test it. We actually am a company that I worked at in the 90s we used to run 20 banner tests every single day. We would go to lunch and everyone on the team would make a bet of the order that the banners would perform and nobody could ever guess the order that the banners would perform. It became obvious to me that the only way they know is through that testing and it's almost impossible to to guess what's gonna work and what's not going to work. And that's why why you want to run lots of tests and be as scientific as possible about it. How do you prioritize which test to run?
Speaker 4 38:03 That's a, that's a great question. So you gotta be careful cause I've seen startups that try to build this massive testing engine and they don't really do anything like they, like they spent all this time trying to really nail the right like a perfect test. When in the meantime we've like whipped together, you know, five tests, two of them have invalidated while this other, you know, a, you know, you've got a situation and <inaudible> situation. It has been, you know, actively trying to build one test to such a great degree of certainty that never really get it done. It takes forever and a lot of resources. So the whole point of testing is to be able to go faster. So there's a cost to setting up infrastructure for testing. You've got to get your analytics in place, you got to be able to do test and track it properly and you've got to have a tracking mechanisms that infrastructure is a costly, I don't recommend like I, I recommend a basic infrastructure, start running tests, get better product market fit more revenue and build the infrastructure as you go.
Speaker 4 39:05 That's just how I do everything frankly per burrito, I pretty much everything a Pareto 80 20 rule. But how do you prioritize which test to run? You just need to ask yourselves which KPI does this affect? How important is that KPI? And then it's a cost time analysis, right? How long will it take to run this test and what is the effect of that? If it's like a five minute change and it could potentially have a good impact versus a 20 hour change, it could have a really a bigger impact. I would run the five minute change and this is where it gets kind of tricky sometimes what ends up happening is you end up only testing these very small changes and you never get that breakthrough or that meaningful moment where it's like, wow, like we actually tested a whole new user experience. Okay, this was a really big test. It took us a month to build this. At the same time we were testing like probably 30 40 other things in the same meantime, then there's much smaller. So you need to be able to test big things that are very difficult to test along with smaller things that are give you more rapid, immediate results and you need the big wins and the small wins, not just one or the other. Right.
Speaker 3 40:15 And, and so who makes that decision for you guys? Is there, are you, are you the one who's kind of making the final decisions around that or do you have
Speaker 4 40:21 well, no, no, no way. Yeah, there's no chance. Uh, you hire smart people to figure that out. So team leads would make those. They make those decisions so anybody on a team can decide what tests they want to run. Actually anybody can run their own tests. Frankly, it's only when they start requiring resources from other teams where that person who's helping you, that's where it gets a little tricky. It's like, you know, if I'm helping you and I'm helping this person, which one's the higher priority tests and that usually requires some conversations, but usually you have company priorities and it becomes obvious which one Trump based on the company priorities. Like right now business side growth is the priority. Right? Last month it was churn, so anything, any tests related to churn would Trump all other things. Right now any tests related to business side growth, any resource allocation, frankly outside of the core. Okay. Ours will get prioritized to business side growth.
Speaker 3 41:27 That's actually one place where I think a growth lead can be pretty helpful. Is is kind of looking at the entire of all of that and keeping the team focused on what those high priority areas are that you're, that you're talking about and then just really leading that discussion and conversation because so many of those other team leads are responsible for a particular KPI. It's, it's hard for, for kind of an individual team leads to to make those decisions. We're getting close to wrapping up here, Moe, but I wanted to first say congratulations on all the success that you've had. It's not surprising. I agree. Product market fits huge and in any successful situation you can't get there without product market fit, but it sounds like your, your passion, the passion that I'm sure you have on the rest of the team and how you're executing and that that constant learning and iteration has been really critical for, for the success of the business. I wanted to end with just one last question of what do you feel like has been the most important learning that you've gotten maybe about growth now versus a year ago? What's, what's the one most important thing that you had that you know now
Speaker 4 42:29 trust the process, but check it every step of the way.
Speaker 3 42:33 Awesome. Yeah, I love it.
Speaker 4 42:35 I'll give you the closest analogy is going to the gym. If you go to the gym one day, you're going to be like, Aw, this is so painful. I don't see any muscle. And then it's like, Oh no, you actually have to go to the gym for like three months and you have to be doing the right kind of workouts. So you should spend a lot of upfront time figuring out what is the right process. Right? So you've got to look at people who have a lot of success training and then follow their methodology. That would be the process you're going to follow and then trust that it's going to work. But measure every step of the way. Cause you should be able to see along the way. I maybe not immediately, but somewhere along the way progress.
Speaker 3 43:15 I love it. So thank you so much for opening up and sharing how you've approached growth and the challenges along the way. I'm sure it's going to be super useful for a lot of other entrepreneurs out there. I'm also confident based on everything that you've said that you're going to continue to build on the success that you've had. So congratulations and to everybody who's listening. Thank you for tuning in.
Speaker 4 43:35 Thank you very much for having me. I'll just leave with one last ask here. If you are interested in our mission of accelerating human potential and you know, providing the skills transfer, uh, from professional, novice making skills that's socially acceptable to anyone in the world, reach out to us. We are looking for smart people to join our team who are motivated for any kind of position, whether it's growth or engineering or design. We're looking for the very best and if you want to be part of the very best, please reach out to us. My email is Moe at gen dot. Co you can email me directly or just go to our website. We are doing the rebrand, so by the time this gets launched we may be called Acadian. So keep that in mind. I'm sure Sean, you can mention that earlier on in the podcast and the notes, so Acadian is going to be the rebrand, but other than that, thank you for hosting me. It's great to be here with one of the best growth marketers that's ever lived, mr Alice. Appreciate it. Thanks man. I appreciate it.
Speaker 1 44:35 <inaudible>
Speaker 2 44:40 thanks for listening to the breakout growth podcast. Please take a moment to leave us a review on your favorite podcast platform and while you're at it, subscribe so you never miss a show until next week.
