Episode 38
· 39:24
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Speaker 1:After your trial is over, use my coupon code product people TV 2,013, all one word, for 10% off. This week, we chat with New York based entrepreneur Spencer Fry. He's built some really cool products and been a part of some really cool teams including Carbon Made. Right now he's working on a new product called Uncover and he's got lots of advice for product people especially when it comes to sales and marketing. Let's listen in.
Speaker 1:Hi, I'm Justin, and this is Product People, the podcast focused on great products and the people who make them. Today, I'm joined by Spencer Fry, co founder and CEO of Type Frag, Carbon Made, and currently working on a new project called Uncover. Spencer, welcome to the show.
Speaker 2:Thanks for having me.
Speaker 3:How are you doing today?
Speaker 2:Doing very well. We actually have some nice weather in New York City finally after about two or three weeks of ridiculously hot weather.
Speaker 3:Oh, really? Yeah. What's hot for New York?
Speaker 2:Mid nineties. And then, you know, the humidity is terrible here.
Speaker 3:Oh, yeah.
Speaker 2:The grass fall in the large buildings. But today, we kinda have a breeze. So it's been nice. I think it's, like, low eighties today.
Speaker 3:Perfect. We it's I'm in British Columbia in kind of the southern part, and it can get really hot here. We had 100 degrees Fahrenheit yesterday, but there's no humidity. It's just like dry heat, basically, which makes a big difference.
Speaker 2:Yeah, a huge difference. I bike everywhere, so it's really tough biking to work and everything with like a sweaty backpack.
Speaker 3:Yeah, so do I. So do I. The heat does make a huge difference actually when you're biking around. It's nice when it's like in the morning and it's cooler, but yeah, if it's middle of the day, it's not so fun. Well, Spencer, maybe we could start by just having you give us a background on yourself.
Speaker 3:Where did you grow up? And maybe talk about how you got into building stuff in the first place.
Speaker 2:Sure. So I grew up in New Haven, Connecticut, around and actually on the campus of Yale University because both my parents are professors there.
Speaker 3:Okay.
Speaker 2:At a very early age, I'm 29 now, I think at around 10 or 11 years old, I had really, really high speed internet. While my other friends were kind of on dial up modems, I was on Yale's internet.
Speaker 3:Oh, no way! So that would have been one of the original T1 connections or T3.
Speaker 2:Yeah, think we were even at T3 at that point. So that was '94 or something.
Speaker 3:Wow!
Speaker 2:Yeah, 94, 94, 95. I was browsing the internet all the time because everything was so fast. I just got really interested in video games, which actually a lot of entrepreneurs, that's kind of where they started. And I got really interested in video games. I started kind of putting up little sites that, like gaming websites, like news about different video games.
Speaker 2:And that eventually led to kind of type frag.
Speaker 3:And what is type frag?
Speaker 2:Well, kind of in early college, I was messing around on different internet stuff for my whole teens and high school days and actually started like a small web hosting company and shell service for IRC and all this craziness. But I was always very into video games and Typefrog founded that when I was a sophomore in college, so I think 19 years old, and that was kind of my big first internet success. And TypeRag was voice over IP for computer game players. Kind of in the Counter Strike days, everyone used to kind of play together, but it was very hard to communicate with their teammates. There was built in voice, it was very bad quality.
Speaker 2:Gotcha. We launched TypeFrag so that teams and friends could kind of talk together while playing the game.
Speaker 3:How did you figure out quality voice over IP when you were 19?
Speaker 2:There was a small community using the software called Ventrilo, which is still around today. And it's basically like a standalone app that was very, very lightweight, very poorly designed, but the voice quality was really high.
Speaker 3:Mhmm.
Speaker 2:And it also supported kind of up to 400 people at once on a single server. And a lot of these games, some of them had built in voice at the time, but the quality was really, really low and it was capped to your team. So we kind of saw an opportunity there where it's like you didn't have to be connected to the game to talk to your teammates and the whole esports revolution that's really, really hot today in the last few years was just starting to get going. So we kind of saw an opportunity there to build TypeFrag and to allow teams to be able to use this voice service.
Speaker 3:Yeah. And so you built this with a co founder or a friend?
Speaker 2:Yeah, built it with a co founder. We both kind of did the early development stuff, and he then kinda took on the lead role as the developer, and I took on kind of the CEO sales marketing role. And, you know, we were actually it's interesting because now people are doing podcasts a lot more frequently in the last five years, even ten years, but in the early 2000s there weren't that many podcasts, but there were a lot of gaming podcasts.
Speaker 3:Yeah.
Speaker 2:And so that was one of we were one of the first to actually market on a podcast of any company out there on the web. I think in like 02/2003.
Speaker 3:Yeah. Wow.
Speaker 2:It was
Speaker 3:really early on.
Speaker 2:Yes. Super, super early on. There was kind of live broadcasts of these games. And we got in early and they would be like, you know, this is brought to you by typefrag.com, you know, get your Ventralo server sort of thing. And they actually recorded like spots for us and everything.
Speaker 2:So it really kind of neat.
Speaker 3:And so how did you do the sales and marketing for something like this? You talked about the podcast sponsorship. What else was involved in getting this off the ground? And actually, maybe let's just back up a little bit. How long did it take you to build it?
Speaker 2:So Ventrilo was software that was out there and we basically we licensed the technology and then we built the kind of the backend and the database to manage the servers. So it was like this thing you could host on your local machine but obviously that would be slow. We took it and distributed it around the world. I think we had, When I sold the company, I think we had 10 to 15 locations around the world and on really, really fast connections. And we did all the administration, the system admin stuff and built this back end control panel.
Speaker 2:We were also one of the first to build control panel too in 2003 where you could actually manage the entire service. We were very early as a web app.
Speaker 3:Yeah, and you said multiple locations?
Speaker 2:Yeah. Because latency is always, a huge thing in video gaming. So closer the voice server was to you as a player, the faster the connection would be. So if you were in, like, California and connecting to a New York City server, that would be slow. So we had servers in Seattle, Washington, in LA, and stuff like that.
Speaker 2:Our West Coast gamers could use those.
Speaker 3:This is a lot of logistics. Yeah. Europe.
Speaker 2:It was crazy.
Speaker 3:That's a lot of logistics because you guys were nineteen, twenty, twenty one when you were building this.
Speaker 2:Yeah, it was funny because I went to Yale University and I started as a computer science major and then kind of midway through my sophomore year and typewriter started to catch on and I basically had to drop my major and pick up psychology because I didn't have enough time to complete the CS requirements.
Speaker 3:This was taking up all your time.
Speaker 2:Yeah, was definitely a full time business while school. We had employees and everything. Was crazy.
Speaker 3:Now, you said it really started to take off. What does that mean? I'm looking at what it says right now, it says servers starting at $2 per month, that seems like a pretty low price point.
Speaker 2:Back in the day, when I was still involved, we were charging about $5 per slot or maybe $3 or $4 per slot. Now they're charging about 40¢ because there's so many more competitors. But at the time we were so early so we can kind of set the price.
Speaker 3:Gotcha! Was that per slot per month? Is that how it worked?
Speaker 2:Yeah, per slot per month, yeah. So it was recurring.
Speaker 3:So you were doing recurring revenue in the early two thousand. This would have been what? Early 2000s. Yeah.
Speaker 2:Yeah, I think it's going to be this December will be the tenth year anniversary. Wow.
Speaker 3:So early on for recurring revenue. How did it do? Talk me through launching and then growth and all that stuff.
Speaker 2:Sure. So, you know, we started in early mid December two thousand and three. We just basically wanted to build this thing because we kind of saw it taking off. We launched it, I think, in March and it was funny because I remember the first week my partner was like, This is a bus. No one's buying it.
Speaker 2:Took a full five days to get our first user and then we got our first user and then twelve hours later we got our second user and then six hours later we got our third. And then within two weeks we had maybe 20 to 30 accounts already set up. And then by that summer we had hundreds. So we were growing really fast, really quickly. The main ways we were kind of advertising this thing was IRC is like a huge, I don't know if it was anymore, but it was like a huge gathering place for computer gamers.
Speaker 2:You had Counter Strike channels, you had all these professional esports teams had their own channels and their fans would kind of hang out in the channels and chat with the members and so forth. So we kind of saw that as a place to put our advertising
Speaker 3:and
Speaker 2:no one was doing this at the time. IRC channels have basically subject lines. So what we did is we talked to all the top gaming teams that were just starting to get sponsorships from Intel and these bigger companies and we said, Can we be your voice over IP sponsor and give you guys free VoIP connections? Can you then advertise us on your website, your IRC channel and your T shirts when you go to different gaming events? So we got all the best clans at the time, all the best teams, and just kind of went from there.
Speaker 3:And did that actually provide a lot of growth? What provided the best growth?
Speaker 2:I think it was definitely a combination between the podcasting stuff and the teams. Because one of the things is like, you know, the reason people buy Michael Jordan shoes is because it's Michael Jordan, you know? And then the same thing in esports. Average players want to use the same technology that the professionals use. So whether it's like a mouse, you know, a mouse pad, a computer, a graphics card or even a voice server.
Speaker 2:So, yeah, it was definitely like a huge thing for us.
Speaker 3:And this was right when that kind of professional team sponsorship was starting off. So you were you were really early then. How important do you think that is? Because that's that's a kind of oft discussed thing is timing, you know, and from the outside, sometimes it can seem like, you know, the people that get in early definitely have an advantage over those that maybe come in later. Do you think that's true as well?
Speaker 2:Yeah, definitely. I mean, the one thing to say though is that for us, I think we might have been the twentieth company to launch this service, but within three months of launching, we were the biggest by far. So I think there is a combination of being early but it's also being smart, you know, having the best products and then kind of knowing how to get the word out there. Know, something I talk about a lot kind of these days in 2013 is that there's just so much competition out there. You know, whatever market you enter, there's a dozen competitors.
Speaker 2:And if you don't kind of know how to do sales or marketing well, you're going to just flounder. So think it's definitely very important to kind of focus on those things.
Speaker 3:So you think that the differentiator nowadays is sales and marketing?
Speaker 2:Yeah. I mean, 90 I think of a business success, like going from zero to X amount of money per month, think is all sales and revenue. Like I do a little consulting and whenever I talk to startups or new founders or people thinking about new ideas, I tell them to spend 90% of their time thinking about how they're gonna get users. Because user acquisition at this point, I guess in the life of the web, is the number one thing you need to focus on.
Speaker 3:Yeah. So it seems
Speaker 2:like Sorry, I was just going end with saying, you know, it seems like people are way too focused on product development and design and all that stuff, but just not focused enough on the sales and the marketing and especially new entrepreneurs.
Speaker 3:Interesting. Especially interesting coming from the carbon made guy. So maybe we should. Well, first of all, let's round off type frag. Like what happened with type frag?
Speaker 3:How long did it run and then you decided to sell it?
Speaker 2:Yeah, so it's still going today. My former partner still runs the thing. I think there's somewhere between, I think, thirty and fifty employees right now. And the business is now located in Cleveland, Ohio. But we worked together for about four years and then kind of decided to part ways.
Speaker 2:It was just around that time when I met Dave and Jason, who then I worked on CardMate with. So it was kind of like a nice segue into that.
Speaker 3:And did you end up selling your half of type frag? Like how did things like that work when partnerships, you you decide to move on?
Speaker 2:Yeah, I think, Dave and I, Dave, the typewriter Dave, both of us kind of, we lived in different cities. We had different kind of ideas for the business and we were making a lot of money as 21 year olds, like a lot of money. And we just kind of felt as if one person needed to own the company and kind of just run it themselves. We had a kind of I don't know how to say bidding war in a nice way, but we had a bidding war. And he came out on top in the end.
Speaker 2:But I mean, we were both very kind of happy with the exit.
Speaker 3:Bidding war in the sense that you were interested in running Type Frag. He was interested in running Type Frag.
Speaker 2:They both raised money. Type Frag, all my businesses have always been bootstrapped and so was Type Frag. But we both raised money to buy the other one out. So, it's kind like we each had our own set of investors. It And was just, I think it was like about a three month process of like, here's my offer and then here's my offer plus X and went back and forth for about three months.
Speaker 3:You guys had a funding battle royale.
Speaker 2:Yeah, crazy. We were 21 years old at the time.
Speaker 3:Well, you know, what's interesting about that is that every time you talk, I keep thinking, man, these are really crazy lessons for someone so young to be learning. But because often there's people in the business or at the top of the business and the business needs room like leadership room or management room or just needs something different. And sometimes if there's like two partners, for example, that are kind of holding on to those top spots, the business doesn't have room to grow.
Speaker 2:And it
Speaker 3:sounds like you guys figured that out.
Speaker 2:Yeah, I mean, I think if I could go back in time, I think Typewriter is an amazing business and it's even much bigger today. Think like if we were a little bit older, maybe, you know, if we had five, ten years more experience, we would have made it work. But yeah, at the time it needed to be run by one guy.
Speaker 3:Yeah. And so you mentioned meeting these new guys and starting Carbon Made. How did that happen?
Speaker 2:So I forget exactly how I reached out to them, but I needed business cards for typewriter or something. This was the day of business cards or the time when people still had them.
Speaker 3:Yeah, yeah.
Speaker 2:I remember that I reached out to someone and then they referred me to this guy, Dave, who is the creative director and co founder of Carbon Made. And we started talking a little bit. And then when I left TypeFrag, I reached out to him and Jason. They both ran kind of a design ad agency sort of thing consulting company. I reached out to them to see if they wanted to work with me on some design and development stuff for a new sort of idea I had.
Speaker 2:That sort of wasn't part of me, but it was kind of If you're familiar with Foursquare at all, think about Foursquare but just or just the web component and not the mobile component.
Speaker 3:Okay, yeah.
Speaker 2:So the three of us worked on that for like four months or so. And then they reached out to me and asked if I wanted to join their consulting company as a one third partner and help them run the business. Because this thing we're working on hadn't even launched yet, I decided, you know, that makes sense. So I joined them.
Speaker 3:And was the company called Carbon Made before you joined?
Speaker 2:No, was a company called Enterface. It was design and ad agency company. And so I think this was maybe like February, midway through 02/2006. Dave, who was a designer and creative director, he had built kind of like the first iteration of CardMate on his own kind of to manage his own online portfolio. But at the same time, it was kind a small side project for him and they were both focused more on the ad agency thing.
Speaker 2:And they wanted to bring in another guy that could help them build Carbon Made.
Speaker 3:So the idea for Carbon Made was kind of already there. And then they said, why don't you come and help them build that app? Is that the idea?
Speaker 2:Yeah. Yeah. Because, you know, at the time when I joined, you know, we still had clients and everything. So it was like a lot of client work and if you've ever done client work, it kind of takes up all your time and it's really difficult to kind of build an app at the same time. So I joined to help them kind of bring CardMate to life.
Speaker 2:And that was kind of my job over the first year while they were kind of finishing up a lot of the client work.
Speaker 3:That's interesting too, because, you know, that's a lot of our listeners are in that space. They're doing consulting work. And, you know, I think this would be good to talk about because I think people have a hard time sometimes, or at least I do, thinking about working with other people. So, you know, for myself, you know, I'm a creative person. I like building things.
Speaker 3:And I'm just like everyone else. I'm limited by my time. But I'm always just thinking, I'll just do that myself. I'll just you know, I'll work on this myself. And I keep kind of grinding away at it.
Speaker 3:But it's either really slow or it doesn't happen in this case. Well, in both cases, you've partnered up with people. And in this case, they actually hired you to kind of while they did the consulting work, they hired you to get kickstart this new idea.
Speaker 2:Yep. It's interesting because I've actually been talking to a few friends actually last night over beers about one designer, one developer, and they're both kind of looking to potentially work on something on the side. But I told them both that it's really, really hard to do by yourself because one, have limited hours, but you don't have anyone else to push you. But if you can only work five hours a week or ten hours a week, nice to have someone else who can also put in another five or ten hours a week as well. So I've always looked at it that way.
Speaker 2:Like it's better to have a smaller chunk of the pie, but increase the likelihood of being successful.
Speaker 3:Yeah. Did you ever have the fear, though, that people have about giving up control or finding the right person? Was that ever part of it? Or did you always just have a sense of who would make a good partner for you?
Speaker 2:I think I've always just had a sense of who would make a good partner. For me, I'm technical nowadays, but back then I didn't really program. I did some design but very limited. So I always needed to work with people that could do those two things. And a lot of designers and developers believe they know how to do sales and marketing and user acquisition but don't.
Speaker 2:So I think it's always good to pair with someone who has opposite skills with you.
Speaker 3:Yeah. Do you think that's a good mix? Is someone who's maybe more interested in doing sales and marketing and then someone who's more interested in building and coding and things like that?
Speaker 2:I think the team that we had in CardMate was, and I wrote about this a while ago, was the most ideal team you could have because it was basically one business guy, one ridiculously talented developer and one ridiculously talented designer. And together you can basically do anything. You know what I mean? You can cover any aspect of a web app or a business period. You know, if you can get those three guys and give each one of them a third of the company, you know, you're good to go.
Speaker 3:And were you the business guy in that equation?
Speaker 2:Yeah.
Speaker 3:Okay. How did you decide that? I think that's a you know, there's a lot of like I've been on computers since 1985. Love computers, love technology. But that the identity, especially on the Web, the way you define yourself, Are you a developer?
Speaker 3:Are you a designer? And then are you a business guy? Sometimes that can be a little scary saying, do I want do I want to, like, say this is my identity now that I'm I'm just this guy? How does that kind of work itself out in your mind?
Speaker 2:Yeah, I mean, I think it definitely, just being the business guy definitely affected me a lot kind of personally for my years at CardMate. I think that I always felt like I wanted to contribute more to the product from like a design and development point of view. So when I ultimately left the company four and a half years later, the first thing I did was pick up programming. That's kind of where I spent all twenty twelve doing.
Speaker 3:Is teaching yourself how to program?
Speaker 2:Yeah.
Speaker 3:Interesting. So so that was something that you were doing. You were being the business guy at Carbon Made. But eventually you said you wanted to kind of learn this other thing and maybe shift gears a little bit.
Speaker 2:Yeah. I mean, you know, my years at Carbon Made, I think were some of my favorite years of my life and I think we built really, really awesome stuff that people love. We had the best users. Everyone says that, but we really did. Creative people that were just so nice.
Speaker 2:Working on a creative product all the time with creative users, you're like, Damn, I wish I could make something. I sold out of CardMate as I did with Typefright and I had kind of a cushion. So I felt like the next thing I wanted to do was learn to program.
Speaker 3:Yeah.
Speaker 2:To kind of be able to build
Speaker 3:stuff for the web. Before we go too far, like before we leave Carbon Made, because you just had that comment before that sales and marketing is 90% and, you know, people are focusing too much on design and product. And carbon made is I don't know if we've explained what it is, but it's online portfolios for designers, right?
Speaker 2:Yeah.
Speaker 3:And so, I mean, it's kind of known as a really well designed, like a great product, kind of a crazy culture, really kind of cutting edge, especially on design and things like that. How do you That's
Speaker 2:all Dave. Dave is a brilliant designer. It's funny because he was doing all this stuff 02/2006, again before anyone else was doing it. Like these bright colors, these huge icons, the big fonts, the whole style, the look and feel. Like he was the guy who started that.
Speaker 2:And so Font choices, everything.
Speaker 3:How did you sell it? Because you've got this beautiful product. Yeah. What what were some of the challenges with actually selling carbon made? How did you guys get it actually to be a, you know, a company that made money?
Speaker 2:Sure. Well, I think so. The early days when we first launched, we were basically the first online portfolio. So we had kind of early users from that. But again, like when you're the first, you always run into trouble that people aren't searching for you because they don't know you exist.
Speaker 2:So we spent a lot of time and kind of money on SEO and paying for advertising on Google and getting into design blogs and featuring good artists so that people would come to CardMate to Again, people want to host their work where other good artists are hosting their work, similar to Typewrang, where they want to use the same services that professionals are using. So we did a lot of that. And then, you know, just a lot of pushing it locally. I started doing a lot of talks at like SVA and NYU and all these places and just try to get the word out there.
Speaker 3:And what's the typical customer? What pain are you solving for people with Carbon Made? Why were they coming to you and shelling out money for this?
Speaker 2:I think the biggest thing was that it was kind of the easiest and do it yourself kind of portfolio system. So there are a lot of other ones out there where you could customize every single little thing and like edit the HTML and do all that stuff. CardMate has never been that. It's always been you just upload your work and we display it really, really beautifully and you can toggle like one, two or three different kinds of settings and that's it. You don't have to learn web development to have a portfolio with Carbon Made.
Speaker 2:And then we also host everything for you. Yeah. So it's just like for people that are just painters or photographers who don't want to learn how to develop for the web, it was just the easiest solution.
Speaker 3:Although now it would probably be really difficult to start a company like Carbon Made.
Speaker 2:Yeah, it'd be impossible.
Speaker 3:It's good that I think that we mentioned that because I think that's hard. People feel like, in some ways, the tools have gotten so much better and easier and people go, Oh, I could start a CMS for editors. That be awesome.
Speaker 2:When we launched, there was basically us and then shortly after Behance launched, it just sold to Adobe recently for a lot of money.
Speaker 3:But
Speaker 2:we definitely had multiple competitors start launching like every few months. But Behance and us just and got so big so fast that these other guys just couldn't compete.
Speaker 3:Yeah. Interesting. Well, let's move on to your current project. I think we'll end part one with kind of the story of what's going on with Uncover. And in part two, I want to talk about some tactics.
Speaker 3:I want to talk about sales, maybe even like product development. And you've written a couple of posts on that. But let's talk about Uncover. What is Uncover? What's the story behind that?
Speaker 2:So, you know, part of the story for Uncover is something I've been thinking about for like the last five to ten years, but I've always run operations at, you know, Typewrang and CardMate and so forth and done all the hiring and all the employee management stuff. Basically, all the HR stuff was just part of my job. We were always very focused on employee happiness and making sure everyone had what they needed and that they felt included and we'd go on company outings socially and all that stuff. But a lot of companies out there, they basically don't know what to do. Part of Uncover, the idea is to address those needs and basically to increase happiness and wellness at your company.
Speaker 2:And that was something that I've always been really passionate about. My current co founder Mike has also been that way.
Speaker 3:And how is Uncover going to achieve that? Like what does Uncover do that increases happiness?
Speaker 2:Sure. So I won't spoil all the future plans, but
Speaker 3:You're going to spoil a few of them, though, right?
Speaker 2:Yeah. I mean, I can tell you guys currently about what we're doing. So we launched in January and the idea was to be able to quickly give your employees perks and rewards that actually were meaningful. So for years there have been these kind of perks companies that they basically gave you a large coupon book to a bunch of different places, like 10% off six flags and all these different services. But no employee ever used them.
Speaker 2:Know from friends of mine who run companies, these companies are listed at a discount price, but they never get orders. So we thought, one, there's very little value there for the employee. What can we do that's better and more impactful that everyone would come to work and be like, this is awesome. So we launched this perch program where employers can give actual things to their employees. Right now we have I think about a dozen different categories but everything from music to cleaning services to gym memberships to food membership like things to coffee and tea, to books, to video, all sorts of different things.
Speaker 2:And the main difference being is that the employer covers kind of the complete cost of the good.
Speaker 3:Gotcha. How did you wire all of that up? Did you have to do deals with suppliers or is there like an API for perks somewhere?
Speaker 2:There isn't. So, you know, a lot of it is that we had to go in and make deals, but also there's kind of some, you know, like manual process to it. Kind of a combination of both. But we have with the bigger guys, have a lot of deals in place.
Speaker 3:So with like iTunes and Starbucks.
Speaker 2:Yeah, those bigger guys.
Speaker 3:Yeah.
Speaker 2:And so the system is like actually fairly complicated on our side. And when people look at it, they think it's not much of a technology solution, but it actually really is.
Speaker 3:And right now there's some manual grunt work in this too.
Speaker 2:Yeah, there is. And we're trying to kind of Paul Graham actually just wrote an interesting post about this about two weeks ago and then Jason Fried followed up with it too. Like the idea of starting manual as much as you can and then only optimizing with code as something becomes really tedious. And that's kind of the approach we've taken. So it was very manual three months ago and today it's less manual.
Speaker 2:Every week it's becoming less manual for us.
Speaker 3:Yeah. Cool.
Speaker 2:We're seeing amazing adoption rates. It's crazy, all the companies that have signed up, employees are redeeming 85% of the perks.
Speaker 3:And so it's live right now, you have customers signing up already. When did you launch?
Speaker 2:We launched, I want to say, about two and a half months ago. So that would be April 2013.
Speaker 3:Okay.
Speaker 2:And we started in mid January. It So was something that we've been thinking about in parts of 2012, but we didn't kind of set out to begin building the thing until January 2013.
Speaker 3:And how do you make money? What's the business model?
Speaker 2:So we charge kind of just a standard service fee of $5 per employee per month, which is actually interesting because that's what you're seeing a lot of companies do these days, these enterprise companies. They're charging per seat Yeah. As opposed to just, you know, dollars 50 a month for 10 users and then $100 a month for, you know, 25 users and then $150 a month unlimited users. They're charging specifically a single price per user.
Speaker 3:Yeah. Although I know some companies that are actually now going the other way. Were at a per seat and now they're going back to more of a general. Do you think? Is $5 a month per user, is that a business model that's going to be able to scale?
Speaker 3:Do you think that's going to continue to work?
Speaker 2:It seems to scale so far for us. We have companies of all different sizes and you know, the nice thing from our point of view is that a 50 person company hopefully will grow into a 75 person company within a year or so or two years. So that's additional revenue for us. Whereas if we were just like free or not free, but a set price for your company of over 50 employees, we'd see a lot less of a LTV for that Yeah.
Speaker 3:And do you have an idea of how long LTV is going to be? What is LTV right now and what the potential is?
Speaker 2:Far, we haven't lost a customer yet.
Speaker 3:You've got Perfect!
Speaker 2:Yeah, we've got Perfect, but we've also only been around for two and a half months. I'm guessing that it's gonna be really high for us just because enterprise companies where you're giving things to your employees, it's really difficult to then take them away.
Speaker 3:Yeah.
Speaker 2:Because if you're giving everyone music for free so they can listen to it at work, it's hard to be like the next day, Sorry, guys, we're not giving it to you. Is
Speaker 3:it enterprise companies that are buying this or is it people in the startup space?
Speaker 2:So we're still kind of determining our ideal customer, I guess you would say, but it tends to be tech companies right now and ad agencies. So companies that have kind of retention issues or they care a lot about company culture and they want to kind of better the life of their employees. So it's been great that we've been dealing with a lot of tech startups in New York City and San Francisco and other places in The United States. And So far everyone is super, super excited about it. The employees love it.
Speaker 2:The employers love it too. At the end of the day, it's such a small percentage of someone's salary. Say someone makes $100,000 a year, you give them music that costs an extra $10 a month to you. But the benefit of it is huge. Because you could raise their salary $10 a month, but you could also give them something where it's impactful.
Speaker 3:Yeah, the value of the $10 music is definitely greater than the value of the $10 race. That's so funny how psychotic how that psychology works. I want to talk to you about sales and how you're selling this. But let's do that in part two. So anyone that's listening, back next week for part two, where we discuss basically sales tactics.
Speaker 3:And then we're going to get into some product development tactics, too.
Speaker 1:My oh my, Spencer Fry. What a great guest. You'll definitely wanna come back next week for part two. You can follow Spencer on Twitter at Spencer Fry. You can follow me, Justin, on Twitter as well at m I Justin.
Speaker 1:And we even have a Twitter handle for the show at Product People TV. Talking about Twitter, if you go on Twitter and thank our sponsor at Sprintly right now, I'd love you forever. And if you like the show, please give us a review in iTunes. It's as easy as clicking five stars. We'll
Speaker 3:see
Speaker 1:you next week for part two.
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