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Wavve: Making $76k a Month Turning Podcasts into Videos

11 min read
https://www.failory.com/interview/wavve

Hi Baird! What’s your background, and what are you currently working on?

Howdy! 👋🤠  I’m Baird. I’m 33 and based in Charleston, SC. I am a founder at Wavve, Zubtitle, and a founding partner at Lofi Ventures.

Most of my day job is running Wavve alongside Nick Fogle & Rob Moore. Wavve is a SaaS product that helps podcasters, musicians, and other audio creators to promote their content on social media. Here are a few examples:

Our business model is typical SaaS. We offer monthly and annual subscriptions that range between $8 and $60 per month. We currently have about 6,000 active subscribers.

What’s your backstory and how did you come up with the idea?

My first job out of college after studying communications was with a large software company in Charleston answering Tier 1 support calls. We supported an enterprise CRM product for non-profits. Then I moved into sales as an early employee at a local startup (also in non-profit tech), so most of my background is in support & sales/marketing. 

I was pretty lucky to have opportunities in tech and work with a growing startup to learn skills. The support job taught me how to work with existing customers and how to listen properly to help them solve a problem. As a sales-engineer, I was able to work between the sales & engineering team to help them with demos, scopes, technical evaluations, etc., 

I got married in January 2015 and in February, I told my wife I wanted to quit my job and start a company. It was the first she had heard of this 😬😬

I kept telling her about all my ideas and she finally forced me to meetup with one of her close friend’s husband, Nick, who was also driving his wife crazy. We were both getting the entrepreneurial itch. Our wives got tired of hearing all about our ideas and forced us to go get coffee and talk to each other about them. 

We started in 2015 with an attempt to build a new kind of social network. One where you followed radio shows, podcasts, topics, and other subjects and verbally talked with other fans about them instead of typing. Think Reddit crossed with audio & Twitter. 

Long story short, we launched the product in 2015. It took on a few different iterations as we pivoted around looking for product market fit. We found it with consumers but never actually built a business around it. 

I had already left my job and was working on this full time hoping to raise money, which never happened. Trying to simultaneously bootstrap the product, gain initial traction, and fundraise was really stressful. It felt like we were grasping for straws with any partnership we could find or feature we could build. We lost about 2 years of our time and $30k of my savings (which was most of it). 

We held on to the dream way too long. We kept chasing the next feature, the next business model idea, the next big partnership, etc., until we ran out of time & money. 

How did you build Wavve?

We actually built Wavve as an internal marketing tool just before we sold the codebase and IP of the previous company (even with the sale, we were still way in the hole). 

We wanted to share audio from our social network on social media but realized very quickly that it isn’t possible to do that. Nick built the initial version of a weekend but it was only used internally. I had to commit images & design specs to Github to update the hard coded templates that were in place. It was a pretty manual process but I was able to navigate it fairly well and use it for social media marketing. 

Once we realized the original company wasn’t going to work out, we started creating ‘audiograms’ for podcasters and showing them how it works. We got interested on social media pretty quickly and realized there was a market for this product. 

The original web app was built using angular.js, node.js, and mongoDB. We used a few open source libraries including FFMEG to create the animations. The original infrastructure wasn’t extremely efficient as it relied on large EC2 instances behind a load balancer. However, our usage was fairly predictable so we were able to scale it up and down manually as needed. 

Getting those first 10/100+ customers was really hard. We relied primarily on direct outreach via cold email and social media messaging to obtain those first customers. Taking the time to reach out directly to customers for a $7/month plan was painful but the insights we gained from those conversations was invaluable. We learned why customers purchased the product and that helped inform our content marketing strategy which started working after about 6 months. 

We never did an official launch of any kind. We just pushed the app live and used direct emailing, social media outreach, and constant product development based on feedback. We also learned pretty quickly that podcasters don’t have large budgets (if any), and needed a price point around the $10-20 per month range for this type of product. That meant that we needed to go for a large number of customers to make this a full time gig for us.

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Which were your marketing strategies to grow your business?

When we launched the first version of Wavve we didn’t have an audience and thanks to our failed startup the year before, we didn’t have any funds. The only real resource we had was time (outside of freelancing to pay the bills) so we started with direct sales. Direct sales was a great way to validate the product and ensure that we people would pay for the product.

It seems obvious now but podcasting was really starting to hit its stride in 2016 & 17 so we decided early on to double down on podcasters. We built some scraping tools to build a list of podcasters and began reaching out to them personally via email. The results came in slowly but this was a great strategy to test our messaging, pricing, and packaging. 

Once we realized our price point was going to fall between the $10-$30 range, we knew we had to find something more scalable. We then started focusing on content marketing through our blog. We started with simple how-to pieces and then graduated to more podcast focused content. Our approach wasn’t very scientific. We simply put ourselves in the shoes of our target customers (podcasters that also have a related business) and wrote content around how to start, launch, and grow a podcast. 

Wavve Analytics

Traction has always been slow and linear for us. We never really hit any specific inflection point that made us feel like the business was going to “make it”. Rather, we just keep being consistent with content marketing and social media. With every month of growth, our monthly recurring revenue began to grow

We have been lucky in that our product creates shareable social content. This naturally encourages word of mouth growth. Once we noticed this happening, we really doubled down on making sure our product made videos stand out on social media. The more we could get people asking “Wow. How did you make that video?”, the more referrals we would get. 

Wavve GIF

We focused a lot on creating high-quality, custom audio animations. These animations are a staple of our product and while we had competitors, no one has animations quite like ours. Making sure these animations and other video elements stand out from the rest was key. 

Revenues growth has always been linear and predictable with consistent month over month growth:

Wavve Revenue

We have kept the team lean with only 3 equity partners and a small team of contractors that help with support, marketing, and engineering. Running lean has allowed us to really focus on product development to deliver more features to our customers. Most notably, we were able to complete a massive project for supporting subtitles/captions within Wavve videos.

What are your goals for the future?

For the last year, our north star metric has been 1M ARR. It’s a bit arbitrary and alone doesn’t tell the story of a healthy business so we also want to ensure we are keeping our profit margins in the same ballpark they are in now (70% – 80%). We are hoping to hit this by Q3 2020. 

Around the same time, we want to find an operator (or team of operators) to come help continue the business forward. At heart, we are creators and at a certain point it will be time for us to transition the project so we can create other things. 

We also run another SaaS product called Zubtitle which is growing rapidly and we have a few other concepts we are working on this year under the Lofi Ventures brands.

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What were the biggest challenges you faced and obstacles you overcame?

It’s funny, our biggest disadvantages have almost become some of our biggest advantages. 

The disadvantages we started with were our price point, time, and our market. Podcasters generally don’t have much a budget for tools outside of their hosting platform (most podcasters don’t make any revenue). As a result, we had to set our price fairly low to start. We also didn’t have an audience and the podcast market is very fragmenting. This made getting started very slow. 

When we started, I had just spent a year with no-pay trying to get our startup off the ground (which failed) and Nick had recently passed the bar (he is a lawyer) and decided to become a software engineer. I didn’t have much money left and Nick had a mountain of student debt. Becoming a lawyer isn’t cheap after all. 

These two disadvantages made us build the business slowly while also freelancing on the side. We had to be patient and watch the business grow while constantly re-evaluating whether or not it would be a side project or could become a full time gig. 

Which are your greatest disadvantages? What were your worst mistakes?

Our main disadvantages when we got started was a lack of experience and capital and a naivety around building products. We didn’t understand how to properly evaluate a market, do customer discovery, and make fast decisions while attempting to get the business off the ground. 

We made a lot of mistakes along the way. Our biggest mistake before Wavve was relying on feature development to drive traction rather than use marketing & transaction to fill our funnel. We fell into the feature fallacy and thought the next big feature would set us on the right course. 

We also commonly made the mistake of listening to the loud minority. Say 10 users come in the funnel: 4 would convert and one would be upset. We would listen to that one upset user and let them drive product development rather than listening to the happy 4 customers that paid. 

One example of this was all the time we spent supporting social integrations for a small set of very vocal users that wanted to post to social directly from our app when the majority were fine downloading the mp4 video and uploading themselves. 

I sometimes think we might have taken too long to pay ourselves. We were so desperate to get the business to a certain revenue point that we never were able to feel the effect of SaaS revenue in our own pockets. I would suggest founders to pay themselves something as soon as possible.

If you had the chance to do things differently, what would you do?

The first thing I would tell my former self is to relax. Entrepreneurship is much more of a journey than it is building your first business. I would spend  much time pressuring myself and worrying about making it work that I would cloud my vision when it came to making business decisions. 

Instead of forcing that first businesses until the last minute, I wish we would have cut our losses sooner and moved on to the next thing. 

I also spent a lot of time early worrying about what people in our startup community would think if I failed. I felt a lot of pressure from that, which was useless. And as it turns out, we did fail and then became a success that no one has heard about. 

Cutting the cord on the B2C venture-backed play could have saved us a lot of time and money. We also always knew we didn’t really want to run an investor-backed company but we pressed forward because it was the only option we saw ahead of us at that time.

What are some sources for learning you would recommend for entrepreneurs who are just starting?

I think podcasts are great for when you are just starting out. They give you so much more context around what it is like to start a business. I really enjoy these:

There are a few books that I have really enjoyed that helped me think about how to work and how to approach entrepreneurship:

I also love everything that the Knowledge Project by Shane Parrish does (podcast & blog). 

Try to stay off Twitter. 

Where can we go to learn more?

You can find our website here. You may also want to check Lofi Ventures, we are launching other products and will blog about our experience.

Here’re are our Twitters as well: @bairdhall, @nickfogle, @robmoore.

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