Raising Funding (& Pricing)
Welcome back everyone to another episode of Bootstrap Web. Brian, it's been a
Brian Casel:few weeks. How you been? Yeah. Been a minute. Been a minute.
Brian Casel:I just I'm I'm, like, two days into finally being home from a week with the vacation vacation with the family and then a week at MicroCon, kinda back to back. So, yeah. Cool. Great time on both. Very tired, still kinda recovering.
Brian Casel:But
Jordan Gal:True.
Brian Casel:Yeah. Great time.
Jordan Gal:Nice. I also, went away for spring break. Went to Maui. That was awesome.
Brian Casel:Oh, yeah. That's right. How was that? Good times?
Jordan Gal:Oh, man. It's good there. Yep. Yep. It was it was great.
Jordan Gal:It felt like the first time we had been chill as a family in about a year because we went we went to Maui last year for spring break while we were still in Portland. And we knew as soon as we got back home, we were gonna plunge in to selling the house, moving, buying a new house, all that. So it's like full circle now. We're pretty settled in this house, and we went back there. It was like feels like the first time I saw my wife, like, relaxed in, like, a year.
Brian Casel:That's great, man. Yeah. Our spring break our our kids' spring break, we drove from Connecticut down to Myrtle Beach, South Carolina. Nice. And I've never been there.
Brian Casel:That was, you know, fun beach boardwalk kind of town.
Jordan Gal:Yeah.
Brian Casel:Great weather. Did a little like, a little first, like, glimpse of the beach for the for this year.
Jordan Gal:For this year? Yes.
Brian Casel:But that's like a two day drive. So, we stopped in DC, and then we and then we drove back. And I had about twenty four hours at home before getting on a really early flight to Denver for microconf. Wow. So I was And then, like, I went into microconf this year already.
Brian Casel:Already tired. Like, really tired from the from the trip. You know?
Jordan Gal:That's that's dangerous. Yeah. Yeah. I watched, you know, MicroConf on Twitter, and and I was I was missing it. I was wishing I was there to be around all those people, and I had a very, you know, very strange experience to to announce the series a while MicroConf was going on.
Jordan Gal:I was like, what what have I done?
Brian Casel:What I mean, huge huge news, man. We gotta get into that today. Obviously, we we've known about it a little bit, but now we can actually talk publicly
Nathan Barry:a bit about it.
Brian Casel:So
Jordan Gal:Yeah. Yeah. I wanna talk about the announcement and and maybe, you know, a little glimpse into the process and some sausage being made kind of stuff, which we can kind of only do on this podcast. Yeah. Yep.
Brian Casel:Yeah. Let's definitely get into that. I I I launched a pricing change on Zip Message and Clarity Flow. And Yep. Yeah.
Brian Casel:It's still the two names right now, which is also driving me a little crazy. Been trying to trying to wrap up the the full transition here in the next couple of weeks. But now now at least the new price is live, so I could talk a bit about how that's been going this month. And and other things just trying to ship too many things all at the same time, which is driving me nuts.
Jordan Gal:So Okay. I wanna hear how how you're juggling that and how you're prioritizing it and where where the pressure's coming from. Right? Is it yourself? Is it customers?
Jordan Gal:Is it, like, what what is it? The answer is yes. Yes. All all the pressure. Yeah.
Jordan Gal:And and beyond funding, I I think the thing that's on my mind, partly because of the funding announcement, is just go to market. Like, you know, we we have the product and now we need to we need to get it into different environments. So we're building integrations for the big the big platforms Magento, Commerce Tools, Salesforce Commerce Cloud, SAP. It feels like a decision is imminent for us. At some point, we're gonna choose, a place to really focus, and I have two big bets down on the table.
Jordan Gal:So I I wanna talk about that and how we're
Brian Casel:Alright. Yeah.
Jordan Gal:Experimenting with both.
Brian Casel:I got some questions on that, but let's let's get into the the race, man. So that was that was the big news this week. Yeah. What and and, you know, I I'm always a little hesitant to, like, what, like, what can we actually talk about on air here?
Jordan Gal:We can talk about a lot because there's no solicitation. Right? The round is closed, and I'm not asking for money. So because of that, you can you can talk pretty publicly. Mhmm.
Jordan Gal:At the same time, there's I don't know. There's always stuff that you don't wanna talk about, and it's I it it almost feels like cultural norms around it more so than legal. Like, you know, you don't say who over email and you're talking to a potential investor, you give a lot of details. This is this is the check size of the lead investor. This is what they did.
Jordan Gal:This is the valuation. This is write these different terms and warrants and whatever else are attached to it. And then publicly, you kinda just go headline and leave out a lot of details. And so you saw the articles, and those are also not coincidental. Right?
Jordan Gal:It's like it's PR.
Brian Casel:I mean, I I'm actually interested in the whole pre PR slash and how that was all coordinated. So, I mean, we're recording this Friday, April 21. When when did you actually, like, break the news? A couple days ago. Right?
Jordan Gal:Yes. I think it was on Tuesday. That's right. Mhmm. So so you basically talked to reporters.
Jordan Gal:Yeah. You you talk to reporters a few weeks ahead of time, and then you go around and do interviews. And then you choose one that gets the exclusive, and they get to publish it first.
Brian Casel:Yeah. Who is that for you?
Jordan Gal:That was Axios.
Brian Casel:Oh, nice.
Jordan Gal:Yep. Yep. Had a great conversation with the reporter there. She asked for the exclusive. We thought about it, and then it made sense.
Brian Casel:Very
Jordan Gal:cool. And and so you're you're trying to, you know, you you're trying to do as much all at once as possible so that it gets the most amplification. So Elizabeth, our director of marketing ran the process.
Brian Casel:I I I have a ton of questions, but Yeah. Let's like rewind. Like when when did you actually start the process of raising, and then when did it actually close?
Jordan Gal:Yes. So I started fundraising while we were still in Portland. Okay. That that tells you how long ago.
Brian Casel:That's like over a year ago, isn't it?
Jordan Gal:No. No. Not a year. I guess, and we left Portland around in, like, mid July, something like that.
Brian Casel:Got it. Got it. Okay.
Jordan Gal:So right. So the way the process And
Brian Casel:it was a very different world. Oh. Oh.
Jordan Gal:I I experienced the change in the world. Mhmm. So our my particular experience everyone's got their own version of the experience. My version of the experience was ecommerce was super hot. The market funding e commerce enablement was super hot.
Jordan Gal:Checkout was like unavoidable. You couldn't go to Twitter without seeing something about fast or bolt or tweet threads or Stripe, Mafia or shop. It was just everywhere. And so that made for an environment where it pushed us to just go faster. Just go to market.
Jordan Gal:There's so much attention. You have credibility. Right? Our team has processed billions of dollars. Just go raise your hand and raise a $20,000,000 series a like everyone else.
Jordan Gal:No big deal. That is the environment as we started going to market to raise money. On the product side, it was also like metrics don't matter. Just get the product out there, get our first cohort of customers and just go raise money. So that was the world that we got ourselves ready to fundraise in.
Jordan Gal:And we did the pitch deck, you do all the stuff, you get all the materials going and then you, you know, you use your network and you try to create as much demand as possible. So you're doing, like, forty, fifty meetings in the span of, like, two weeks.
Brian Casel:And, you know, obviously, this is not, your first rodeo or our first rodeo, but I I feel like you you're also just generally, like, well really well connected, especially like, so so, like, going into this process Mhmm. This is not your first rodeo at raising and
Jordan Gal:Yep.
Brian Casel:And and really making it happen.
Jordan Gal:So Yes. And that and that matters. And at least for me, the way the way it makes sense for me to do, I have investor conversations all year round. I like them. I I enjoy them.
Jordan Gal:I learn from them. I learn how I'm talking about things. It helps me position the company and understand what's happening in the finance market as much as the merchant market. So I just enjoy it. And I see it as I see it as my job.
Jordan Gal:So so yes, there's a lot of warm connections to reach out to. And in the months, like, leading up to it, you start to increase those conversations and you're increasing demand. And then you're basically saying, I'll let you know when we kick things off.
Brian Casel:So yeah. So, like, how how do you start to position those conversations when you know like, you're not officially starting yet, but you know maybe in the next two to three months you're going to start. So you're starting to plant the seed, like, so I think we're planning a a series a later in the year. Just wanna give you advanced notice, like that sort of stuff.
Jordan Gal:Yeah. Like, you you'll you'll get cold emails because one of the key things to recognize is that they have a job to do and their job is to deploy money. So it's like they're the salespeople doing cold outreach looking for leads. And you are the customer. Yeah.
Jordan Gal:Right? So so the same way you, like, reach out to people so they can use your software, VCs and analysts, the younger people at VC come VC firms are reaching out to you to basically get you inside of their CRM.
Brian Casel:Yep.
Jordan Gal:So it's like, it's not that hard actually to get into these conversations. And then what you do is you kind of try to really make great impression in thirty minutes and say, here's what we did in seed. Here's what we've done in the past. Here's where the product is. Here's where we are in our life cycle of going to market or beta or first cohort or something.
Jordan Gal:Then you're trying to create demand for when you do go to series A and you basically add them to your CRM to tease them a few weeks before and say, hey, we're getting ready to go to market. I'd love to include you. We're starting meetings on this date and, you know, I I'd love to talk.
Brian Casel:So then okay. So then fast forward a couple months, like how do how do you get into how do you start to structure it in in your mind in terms of like, I don't know, like who's who's leading, who who who's involved? Like, how do we get into this?
Jordan Gal:So it is a it is a very frustrating reality that you can talk to 50 people, 20 of them feel like a great fit. And you're like, we like each other, this can work. But then nobody moves until there's a lead investor. It's just this standoff of, oh, we're so excited. We're so excited.
Jordan Gal:We're so excited. We're so excited too. But nothing moves until someone steps all the way up and says, we would like to lead you around. Here is a term sheet. So I'm glossing over the
Brian Casel:And so my, know, super basic understanding here is a lead investor is the one who proposes the terms or negotiates or finalizes the the term sheet with you, and everyone else who's not a lead investor sorta is like, yes or no. I'm in for those terms.
Jordan Gal:Yep. Exactly right. So they're setting the terms. They're taking the board seat. They're taking the risk.
Jordan Gal:They're putting their reputation on the line, like the the whole deal. They are they are your savior. They're the ones that saying everyone says they're interested. We are gonna go all the way in. And, you know, these partners that you're talking to, they probably get two or three deals a year.
Jordan Gal:So the and then they're gonna work with you for five to ten years. So they are taking a substantial risk. Yep. And I respect the hell out of the people that do it and don't just follow because not everyone leads. So certain funds will tell you off the bat in the first five minutes of the conversation, we do not lead.
Jordan Gal:We really like the space. Let us know when you have a lead. And others are like, we only lead rounds because their strategy is to capture as much ownership as possible in startups that they're they're funding. Yeah. There and there's
Brian Casel:a there's like an advantage to being the leader in terms of the terms.
Jordan Gal:Yes. It's different strategies playing out in those decisions. So what happened to us is we got ready. We sent out all the emails. We set up forty, fifty meetings.
Jordan Gal:We started I had two days of fundraising meetings. And then the third day, the market crashed. And it changed 180 degrees within twenty four hours. It went from, I have all the power. Everybody wants what I have.
Jordan Gal:I'll choose who we wanna work with. And it turned into, uh-oh, no one's investing. Everyone's pulling back. People are canceling meetings. It just went all at once.
Jordan Gal:And that made for a very stressful reality because you are look, It's my fault. Right? The responsibility is with me. I prepared the organization to fundraise in an environment that no longer existed.
Brian Casel:Yeah. Like, how far in were you and, again, I don't know what we wanna talk about on air here. Yeah. Like, how committed were were you or the company as Rally at this point? So you're not you know, you haven't
Jordan Gal:You're near 100% committed. You're near 100
Brian Casel:because Like, you you've already started hiring a team as if you're raising and and, like, everything. Yeah.
Jordan Gal:That's right. So you haven't gone the next level of hiring that happens after the series a, but you are burning money and going fast toward a wall. Yep. And so, you know, I left us plenty of room. It wasn't like a thirty days running out of money thing.
Jordan Gal:But if you start with six months of money left, you know these processes take three, four months. So it's not like there's that much wiggle room. And the last thing you wanna do is be overly cautious and fire half of your team at the seed stage and then try to raise money. It's so you just kinda have to eat the pressure.
Nathan Barry:You just have to you just have to do
Brian Casel:it. Mhmm.
Jordan Gal:Yep. So we went and we ended up getting two term sheets. And it was such a you know, I am not an anxious person. Me and anxiety don't have much of a relationship. I was I was full of anxiety.
Brian Casel:Yep.
Jordan Gal:I I would wake up. Okay. I would go to sleep looking at my calculator. I did okay. No one can see this because it's a podcast, but I just pulled up the calculator app to see how many months of money I have.
Jordan Gal:And that's
Nathan Barry:still the answer on the
Brian Casel:calculator right now. That's hilarious. This is what I've been doing.
Jordan Gal:So I would go to sleep with that math and then I would wake up and I'd open my phone and it would be to the calculator and I would just do the math again. And I'd be like, okay, then go on with my day. And I that's that's I don't know
Brian Casel:what's I you know, remember a a very similar thing when I was selling, you know, like, just, like, figuring out exact alright. So taxes
Jordan Gal:Yep. Yeah.
Brian Casel:Yeah. Taxes or, like, if, you know, if if this plays out or that plays out, yeah, and just, like, constantly having the same literally the same numbers sitting on my calculator for, two months at a time. Yes.
Jordan Gal:Okay. So I I feel you and I am sure other people listening have, you know, that their calculator app is well worn. So we ended up getting two term sheets. Both awesome. Both really liked the the firms.
Jordan Gal:Ended up making a choice to go with Hyun at March Capital just to say first, he's fantastic. And I met him a year prior. I got on a plane and I went to a conference in Las Vegas, the last thing I actually wanna do. And he was there and we had lunch together for an hour and a half and got to know each other face to face. And a year later, he steps up and leads.
Jordan Gal:Right. Not coincidence.
Brian Casel:Right. Like, is how a relationship leads to business.
Jordan Gal:Yes. Multiple conversations, trust, getting to know how the person thinks, getting to know what kind of character, what comments are they making, all all all that stuff. He went to Michigan and we got connected and had multiple conversations about the market and what's happening and why. Turns out they are really interested in the checkout space. They looked at our competitors and just didn't make sense to them for the same reasons that it wouldn't make sense to me.
Jordan Gal:And we just kind of hit it off around all that stuff, and they saw the opportunity, and they took the risk. And I love them for it.
Brian Casel:Awesome. You said that you had you had two, like, two term sheets. So the other one, are they, like, we only lead? So they so since there is another term sheet, like, they wouldn't, not lead?
Jordan Gal:Okay. So
Brian Casel:it Again, we could we can cut the Yeah. Yeah. It's it's
Jordan Gal:okay. I'm trying to think of how to say it. It was a a different path. They were a predominantly crypto fund.
Brian Casel:Got it. Got it. Right.
Jordan Gal:And unfortunately, with what's happened in the market right now, you know, I I'm very happy with our decision because the The US environment has shut out the possibility of doing what we wanted to do. And that sucks, but that is the reality. It is nearly impossible to raise money and launch a token and hand out ownership to your customers the way we wanted to do it in The US right now. You as a corporation that's like, you know, Delaware c corp, it is nearly impossible to do.
Brian Casel:Yep.
Jordan Gal:And But
Nathan Barry:that and that, like, could have made sense
Brian Casel:last year. Right? Like I
Jordan Gal:I I still think it makes sense.
Brian Casel:Yeah.
Jordan Gal:You still think. Makes sense. I don't care what the reputation of the technology is. What it enables is going to happen. It's just, you just can't do it now.
Jordan Gal:So that that's just is what it is.
Brian Casel:Got it. Yeah.
Jordan Gal:So it was like a, it was like, it was a crossroads and, you know, we, we went with what we thought made sense and I'm, I'm happy with the decision. And now we have, you know, we have I'm thinking back to, like, the conversations I had. So I went I went out to LA, and I met the other people at March Capital, you know, to, like, really get to know everyone. And they're great quality people in Santa Monica. Like, it's it's an awesome fund.
Jordan Gal:And it was really fun to rub up against how ambitious they are.
Brian Casel:Was gonna ask you, like
Jordan Gal:wanna build big companies. That's what they wanna No Yeah. Like No messing around.
Brian Casel:Where does, you know, Rally and this deal fit in the in the in their context? Like, how many deals are they doing a year? Like, and and are they focused really focused on this space or diversifying or what does that look like?
Jordan Gal:They are generally more later stage. So it's like series a and up. Right? So they have 1,600,000,000.0 under management. They just raised a $650,000,000 fund, and they write, like, $5,060,000,000 dollar checks.
Jordan Gal:Right. So that's not what they did with us. They they basically came in early in the life cycle for them relatively speaking when they went with us.
Brian Casel:Got it.
Jordan Gal:So we feel great that, you know, we have a partner that that doesn't stop at series a. Yep. But we have a lot of pressure on us to justify the continued investment.
Brian Casel:Yep. Yep. Yep. Very cool. So alright.
Brian Casel:Like, let let's fast forward. I mean Yes. Yes. So you and can you talk about, like, when you closed it? Like and then the process from then to now.
Jordan Gal:Yes. The the first money the first money, which is March Capital, right, after the negotiation, all that stuff, we brought Huion onto the board. And that first money came in over the summer. Then over the span of a few months, we raised the rest of the money. A bunch of existing investors came back in.
Jordan Gal:Two new investors joined, Alumni Ventures and Kraken Ventures. And then you start to think to yourself, okay, how do we take most advantage of this announcement? Because it's one of those moments where you get attention as a company. And so you, you know, you make the most of it on your terms. You don't just say, hey, the round is closed, therefore we must announce.
Jordan Gal:No. You wait until it's most opportune. Yep. And so that's what we did. And then then you
Brian Casel:can And that's the thing with like p with like PR in general. Right? Like you need a newsworthy like everyone wants to be covered and and and get exposure and get a link and and all that stuff. But like you just having a product that exists is is usually not enough. Like that that I think that's why, at least my understanding, that's why these funding announcements happen because, like, that's a that's a big newsworthy event that you can that you can actually get a PR push from.
Jordan Gal:That's right. Because because there are there are multiple parties that are involved. The investors are involved, the market, and the company. And generally speaking, you you want more than just the funding announcement because then it makes it more interesting. The other way to look at it, like the way we're looking at it is, no, the funding announcement is enough to break through right now because checkout products have struggled.
Jordan Gal:And so we want the market, specifically enterprise merchants and agency partners to know everyone might be struggling, right? Fast hit a wall, Bolt really enjoys tripping over things and falling on their face over and over, and we we are the opposite. This is the new thing and it's getting funding. And so we that's the story we're trying to put out there. And then now over the next few weeks, while we have the media's attention, you now you wanna launch the things that you want people to know about.
Brian Casel:Yeah. So okay. So, like, how how do you start to make the push and make the connections, the the coordinating the the the PR push and the actual announcement date and all that.
Jordan Gal:Yeah.
Brian Casel:Uh-oh. It's it's probably similar to the actual raise itself. Right? Like like like Axios is leading. Yes.
Brian Casel:And then, like, you know, like
Jordan Gal:Yes. Create some FOMO. Yes. Yeah. So look.
Jordan Gal:There are people that do this for a living. So we hired a PR firm and they're in our Slack and we're coordinating and talking and they're setting up meetings and I just show up and do the interview and then they follow-up. So it's, you know, it's relatively straightforward. People have done this a million times.
Brian Casel:And and do they, like, strategize or you strategize around like, alright. These are the key talking points or we want the the the the story to focus on this. Like
Jordan Gal:Yeah. Like, they, like, create a brief. Like, what's the most you you right. They talk to you and they try to pull out what are the most interesting things about the story? What angle are we taking?
Jordan Gal:Like, you know, that all the other checkouts are struggling and this company isn't. That's like, that's the angle that we're going after. So it's kind of fun and kind of annoying at the same time, but it's really good because when you push it out there, you get attention that then you can then turn into opportunity. So my calendar next week is full. Right?
Jordan Gal:You put it out on LinkedIn, you put it out on Twitter, a bunch of investors reach out, hey, we're following the space. We'd love to get to know you. So you basically now starting conversations to get to know people for series B.
Brian Casel:Yeah. Fifteen months from now. That's my next question here, right? Is like, okay, what obviously, the the activity is is clear. Right?
Brian Casel:Like like, we all saw it on Twitter and and and everything else. But, like, what does that activity actually look like internally? Like, what what does the lead so are is most of this, like, interest from other potential investors? Are you seeing customer interest? Like, what does it mean for the product?
Brian Casel:What does it mean for your team seeing this out out, you know, publicly?
Jordan Gal:Yeah. It's like a advertisement where you don't know who's gonna see it. You're just broadcasting it out there. And depending on the person's point of view, there it's either, you know, a competitor that says, screw these guys. It's a friend that says, Oh, Jordan, haven't spoken to him in a while.
Jordan Gal:Good for him. And leave a comment on Twitter or LinkedIn. Or it's an agency that says, Oh, we have clients asking about checkout. Maybe I should talk to this company. Or an investor that says, oh, I like March Capital's deals.
Jordan Gal:Those guys are smart. Let me go talk to this person. So it's like, it just gets projected onto you. You're like broadcasting. It's specific not message.
Brian Casel:Yep.
Jordan Gal:And what comes back is varied. So I have conversations with people about joining the team, right? Salespeople like, Hey, I used to work at FAST and I love the space and here are my credentials as a salesperson. Are you hiring?
Brian Casel:Oh, interesting.
Jordan Gal:Right. So it's it's it's just this a whole bunch of opportunity. And of course, you know, when I we have a few proposals out to really big merchants. I I make sure they see it too. So you just you you're just using it because whether Yeah.
Jordan Gal:You're using it
Brian Casel:like in the current sales process.
Jordan Gal:It is it is social capital and credibility capital. That's then how do make the most of that?
Brian Casel:Very cool. The question that I I always have been asked when I talk about the the tiny bit of funding that I that I took compared to has always been like, alright, so like how are you spending it? How, you know, what's Yes. How how what does this money actually mean for the business? Yes.
Brian Casel:How have you thought about that? And I mean, again, like, you you know, the actual transfer of the funds happened months ago for you guys. So, like Yes. Yeah. What what does what does it mean?
Brian Casel:And and also just, like, strategically, in terms of, like, the trajectory of of where you're going. Like, what does it all mean for you?
Jordan Gal:I'm gonna give you the rehearsed, pitch, like, part of it, like, of the story. Right? Because it's in your bank account. You're using it how you're using it. Right?
Jordan Gal:But but people wanna know, well, what's the money for?
Nathan Barry:Mhmm.
Jordan Gal:So at least for us, it goes along with the angle that we're trying to take and the advantage we're trying to take when we go to these new these new platforms. So the message is this money is for go to market. We raise the seed round. We have an experienced team that's processed billions of dollars on the web. We built a killer product with a killer team.
Jordan Gal:A checkout has to be unbelievably reliable. You can't just launch this type of a product and then start messing up people's businesses. It's not an email service that you just say, sorry, emails will start going out in a few hours. Can't do that. We know that from our experience, so we built a killer product and now we have March Capital and these investors and these funds to go to market and bring this service to merchants that are dying for it.
Jordan Gal:It's it's again, it's PR, but it is honest. That's what we're doing. Yeah.
Brian Casel:Love it.
Jordan Gal:That's it. No no more problems. That's it. Got money in the bank
Brian Casel:and nothing to worry about. Yeah. I mean, how how are you feeling about it, like, this week as as it got out there? And yeah. Where are at?
Jordan Gal:The way I put it to the team and to myself is all of this is really hard. And every once in a while, you get a little shine, you have a little fun, and you may as well celebrate that and feel good about it, pat ourselves in the back a little bit, take a deep breath, look how lucky we are to be doing something that we enjoy doing, and, you know, going for something big that we enjoy. And shit, man. You may as well be happy about it. If you can't be happy in these moments, then, you know, then then reconsider.
Brian Casel:Totally, man. I mean, it's it's it's no understatement. It's it's, you know, huge congrats. And this thing is it's it's massive. I mean, we we we talk about how it's it's like a you know, we've been at this rodeo a couple times now.
Brian Casel:And for you, it's like what is it? Like, your third or fourth company now? And it's like this this is, like, literally, like, the the next step of, a 10 x, you know, talk about the stair step approach. It's, like, this is, the next next, you know, huge, step up. So it's pretty exciting.
Jordan Gal:A trip. If you remember when we started this, podcast, I, you know, I I didn't think I'd be raising $818,000,000 for for a checkout company.
Brian Casel:Yep. Yep.
Jordan Gal:But, here we are. But I do think often let let's transition to to your stuff and and and to MicroConf. I think about it a lot. I don't know how the hell I did this without the funding. I respect the hell out of people who are doing it without funding.
Jordan Gal:It is alchemy. It is you have no business being able to do any of this and you just do it anyway through grit and determination and creativity. It's awesome. So I'm happy I have both perspectives. So I'm not carried away or think, you know, the entitlement thing or anything like that is all this shit is so hard.
Jordan Gal:And money does make it easier, but it does solve the problems.
Brian Casel:I was having lunch with a few folks at MicroConf, and one of the things that came up was, like, the mentality around raising any any level of funding versus just purely bootstrapping. And I and I think that the thing that that started to make sense to me, and I think the other folks at the table, was, you know, this whole like, the the folks who who hang out at MicroConf, the the generally bootstrapped founders, like, they we were all sort of surprised that it's not just the, like, the youngest founders out there. You know, it's mostly folks in their thirties and forties, a few in their fifties. Yep. Right?
Brian Casel:And it's like you have to and and so it's really simple business. Like, make a thing, sell a thing to customers, grow grow a great business. Like, that's been the the thing that has always made the most sense to me, and that's what attracted me and, I think, most people to the micro comp and bootstrapping, you know, space and all and all that stuff. So but you you realize that as you've as you go through the the the motions, go through the rodeo a few times, like, raising a little bit starts to make more sense the older that you are in this game. Right?
Brian Casel:The you know, whereas, like, you're in your twenties. This is a broad generalization here. But, like
Jordan Gal:Like, life is cheaper?
Brian Casel:Well, life is cheaper and and also just, like, the idea of starting a business. Okay. So, like, to me in my twenties, when I'm starting to think about, like, launching and creating my very first business, raising funding was not the thing that I was thinking about. I was thinking about what can I build and sell as a product that somebody would buy?
Jordan Gal:Yeah.
Nathan Barry:Okay. And that's still that's still what I
Brian Casel:think about today. But, like, the you know, there's a cohort in the in the startup economy where it's like, oh, you wanna start a business? Then you have to go raise VC. Like, that's how you start a business.
Jordan Gal:Right. It's like which contagion gets you first. Exactly. Where'd you grow up? Where'd you go to school?
Brian Casel:Yeah.
Jordan Gal:Who are your dad's friends? Like, it's a whole thing.
Brian Casel:Yeah and so I think that there are a lot of folks who are attending MicroConf who, you know, start the business the more traditional way of like, you know, like just an old Right,
Jordan Gal:I got $25 and I'm gonna make it work. All right,
Brian Casel:cool. Simple business, yeah. Then the more, you know, maybe you build and sell a business, build and sell another business, and then it's like, you know what, I kinda want a little breathing room on this next one. Maybe I'll raise a little bit, you know, or maybe I'll raise a lot. Like it's, like, and that's when it starts to make sense.
Brian Casel:And it's almost like folks who who are at this level in the game take the funding much more seriously and much more strategically than the younger sort of trendier
Jordan Gal:Like like default, and and it is a bit of chasing credibility and permission
Brian Casel:Mhmm.
Jordan Gal:You know, to to go out and raise, you know, $2,000,000 seed round when you're 25 years old.
Brian Casel:Don't
Jordan Gal:It's just it's just a different way to do it.
Brian Casel:Yeah. Yeah.
Nathan Barry:So yeah. So talk talk to us.
Jordan Gal:I know I spoke for a long time. So let's not we'll we'll do my go to market stuff next week. But what's been going on? What do got?
Nathan Barry:How exciting?
Brian Casel:How how was MicroCon? So Clarity Flow. The other funny thing is, like, I'm I'm I'm, like, trying on the idea of introducing my company as the name Clarity Flow. Like, I I had the I had the name on my on my badge, Clarity Flow, and I didn't realize until day three that they actually spelled it wrong on my badge. And that and that's why everyone I was speaking to was, like, pronouncing it wrong.
Brian Casel:And I'm I'm sitting here thinking like, oh, I chose a terrible name nobody can pronounce.
Jordan Gal:You know? Stand there.
Brian Casel:Somebody over there. I don't know who And it so no. But that that was totally fine. And and the okay. So what's going on?
Brian Casel:Like, I I've been talking about this transition from zip message to Clarity Flow. And the really challenging part of it is that there are multiple changes all that really sort of have to click into place, like, not literally on the same day, but really all around the same time. Because the the longer of a space that we have in between some of these projects shipping, the messier this whole transition becomes. So it's like so I've been working on this transition since January Mhmm. Like, sort of silently.
Brian Casel:And then I announced the name publicly in March. That was when it was like mid March when I launched, like, the one pager on clarityflow.com. That was the first announcement that a rebrand is happening, and this is what the new name is going to be. Now we're in April, and the one of the next big pieces is the pricing change. So launching the you know, we're not just changing the name.
Brian Casel:We're not just slapping on a new domain and and a new logo. It's it's a whole positioning positioning changes I've been talking about. The product is expanding. The whole reason for changing the name is because we we need to tell a new story with the product. And along with that comes comes the pricing change.
Brian Casel:Technically, the pricing change was a lot of work because it's not just taking our existing plans and, like, putting a new price point on them. It was also changing the model from Yeah. Freemium to a more traditional free trial Trial. Okay. SaaS.
Brian Casel:And so my developer spent over a month on on refactoring the billing code to make the new, you know, the the new plans work. And we launched so we launched the new plans on April 3, which was, what, like, almost three weeks ago now. And it's been and so the the new prices, we we do away with the free plan. So there is no more free forever plan. We convert to a free trial, a two week free trial, no credit card upfront.
Brian Casel:But there are a lot of features that you need to put your credit card in in order to access certain features. So we do see we do see quite a few people upgrade before the trial ends, but they still they don't get charged until the end of the fourteen days. Yeah. But they but they put their credit card on file. And so they
Jordan Gal:It's like a little stair step there.
Brian Casel:Yeah. You you can still do a lot. Like, you can start messaging and share a link and stuff without the credit card. But once you start to but, basically, we have new three new plans. The base one is it starts at 49, and then 99, and and $1.99.
Brian Casel:So if you need anything on these upper plans, you need to put your credit card in and, like, click the button that says, like, yeah, I I'm going to wanna upgrade on this. So it's it's been really interesting. You know, like, launching a pricing change has is is always a little little nerve racking. But April 3, it went live. And what this means is, like, for new customers going forward.
Brian Casel:We we have not changed the prices on existing customers. Okay. I I think we will later in the year. We're gonna give them plenty of runway time to to upgrade themselves and get access to the new stuff. But that push is not happening yet for legacy customers.
Brian Casel:But this was just April 3, get it out there for new customers, right? And I always, always, always have this mentality in every product that I've ever launched. Before I launch it, it's like, there is a significant chance that this will fall flat on its face, and nobody's gonna buy this thing. And I
Jordan Gal:That's like every performer's honoring.
Brian Casel:I it's it's it's almost like completely irrational at this point, but it's absolutely real.
Jordan Gal:Right. So can't avoid it.
Brian Casel:I I really believe that, like, once we launch this thing, there's a chance that, like, we're not gonna get a single conversion in Okay. In the weeks after.
Jordan Gal:Scary.
Brian Casel:It was good to see, like, we we did have conversions, like, on day one and day two and day So three, you so it was nice to see not only people signing up for trials, but actually pretty quickly starting to put their credit cards in to access some of these other features. We even saw a few legacy customers, and we have not even messaged to them. Like, they still make their way to the upgrade screen and and upgrade themselves. For the most part, it's it's new customers, and we've been seeing the the upgrades happen every day. And then this week, like in the last three or four days, we see those payments actually start to hit the the Stripe account, you know, because the because the the the two week.
Brian Casel:So then and it's like again, like mentally, it's like, okay. No one's ever gonna buy this or eat like, trials are gonna fall off a cliff. Okay. That didn't happen. Their trials still happen.
Brian Casel:Okay. But nobody's gonna actually put it in their credit card. No. They they actually do put in their credit card, and that's fine. Okay.
Brian Casel:But but these people are probably gonna cancel before the trial ends. Right?
Nathan Barry:Like, these moments aren't actually gonna hit. And then, okay,
Brian Casel:fine finally this week, actually seeing the MRR grow. So like
Jordan Gal:But now people are ask for refunds, Brian.
Brian Casel:Yeah. Here we go, you know, gearing up for the wave of refunds that
Jordan Gal:we're gonna see. Yeah. Jeez.
Brian Casel:So, you know, I I think that's all been good. But, look, like, it there's still a ton of pressure right now because, frankly, like, some of the biggest features it that we're advertising in these new pricing plans are not in the product yet. No.
Jordan Gal:They have not. Okay. So you you got the name change, you got the you got the website, you got the pricing, and the inescapable work around billing. Inescapable. Doesn't matter
Brian Casel:Yeah.
Jordan Gal:How amazing any of these processors are. And now now it's get to work on the feature set to to get to where people want.
Brian Casel:And, you know, there's a lot of stuff that we've been working on, but it's just this stuff takes time. You know, we're building a mobile app right now. We're building payments. Really? Yeah.
Brian Casel:We just started a mobile app, iOS and Android.
Jordan Gal:Never done that. Have you done that before?
Brian Casel:No. It's new for me. Interesting. That'll be interesting.
Jordan Gal:Okay. Okay.
Brian Casel:So we've got that. And and payments is the other one. People are waiting to be able to sell their coaching services through our platform. So, you know, and and I was talking to some folks at MicroConf about this too, where it's like the the trade off between, like, do you build because I I'm at this point where I know exactly what our customers need and want, and we're getting feature requests every single day for the same exact things over and over again.
Jordan Gal:Okay. That's that's good.
Brian Casel:And by the way, I forgot I I forgot we we've been off for the last few weeks, but a major I'd I'd say a pretty big competitor just shut down three weeks ago.
Jordan Gal:Oh. I think you you you mentioned that.
Brian Casel:What Okay. I I forgot that I haven't covered this on the podcast. And the timing of this was crazy too.
Jordan Gal:Okay. Tell me. This this just happened in our market also for one of our, like like, friends, and it was very interesting. So Shogun shut down their front end and basically pointed all of their customers to Pac Digital, who who we work with. So talking to that
Brian Casel:CEO So we did the same thing except they pointed their customers to us.
Jordan Gal:Okay. Okay. Sounds great.
Brian Casel:Okay. So and this happened
Jordan Gal:Now like in your niche though, in in the coaching In area the niche. Yes. How'd they even know about you? Did did you know the person?
Brian Casel:No. Nailed it. So this was probably March 28, I wanna say. So this was like a couple of days before we launched the pricing change. Okay.
Brian Casel:And I this is totally out of so the the app was called Volley. Volley app, if anyone's familiar with it. And I had started to become a little bit more familiar with them in recent months. So Volley has been this video asynchronous conversational app. So I've always I've always known that they were in the market.
Brian Casel:I've I've known them for a couple years now, but they were not really niched down for a while. Until until recent months, I start know, I'm doing a ton of customer research, talking to a ton of coaches, I start hearing the name Volley come up more And and more and and then I start to key into like, oh, Volley is niching down to coaches too. Like I I didn't even realize that until maybe two two, three months ago. Okay. And I'm looking at them like they look kind of significant.
Brian Casel:They did raise VC and like And then
Jordan Gal:Do you hit your crunch base limit every month and then go to your incognito window or you're into that yet?
Brian Casel:I I don't I don't even know. You know, but like with with competitors, generally, I I I take a quick look at them but I don't focus a lot of energy on them at all. I just I just know that they're out there and some customers mention them sometimes and that's about it. Fair. March 28, I'm get I get, like, three or four messages from my my customers and some people in my space.
Brian Casel:They're like, hey, did you did you see this announcement from Volley? They forward it to me, and they're like, we are shutting down at the April. We're out of I think it was just like, we're out of money.
Jordan Gal:Yep.
Brian Casel:And they replaced their homepage with, like, a message, like, we're done, and here's an FAQ on what you can do about moving on and switching tools. So I I find out. I put this at, eleven in the morning. I send a message to their founder, like, within twenty minutes. Like, hey.
Brian Casel:I don't think we've met before. Brian from from Zip Message. I love you. You know, hey. Like, you know Sorry
Jordan Gal:to hear.
Brian Casel:Yep. Sucks. Like, sorry to hear. So bummed to hear. Like, whatever.
Brian Casel:And then and at that point, they were linking to, like, Loom and, like, I don't know, like like a couple other, really huge name. Like, here are some alternatives that you might wanna use instead.
Jordan Gal:Yeah. Okay.
Brian Casel:I don't know if it make sense, if you wanna put us on that FAQ. And so like the founder was really nice enough to Cool. To do that. So he put us linked on the FAQ as like, here's an alternative tool that you can switch to. And I was, again, like one of the very first to to message him about this.
Brian Casel:Mhmm. Five or six days later, there was like eight more competitors that Yes. Follow on the same thing. Fair enough. But but for, like, four or five days there, like, we were the only, like, niche coaching tool on the page, and we were seeing sign ups all day long for from this.
Brian Casel:Right? Okay. So we were seeing an MRR bump just right away from this. Sort of unfortunately, it's like we didn't have the new pricing live for those people yet. I I had no idea this was coming.
Brian Casel:It just happened. Impossible. But also what happened was and, you know, this is when I start to think like, damn. Like, these guys are not small. I can't believe they're just shutting down because I'm I'm seeing a lot of activity from Volley users looking for a new home.
Brian Casel:Right? So, I get another message from someone who's in in the Volley ecosystem. Like, hey, this customer just fired up a Facebook group, of the whole purpose of the group is, like, Volley people looking for a new tool to replace their whole coaching. Like
Jordan Gal:Okay. What? Okay.
Brian Casel:So so I hop in
Jordan Gal:How many people are in the group?
Brian Casel:I I hop in at and this is, like, like, day over the next day.
Jordan Gal:Oh, yeah. Brian's in a target rich environment.
Brian Casel:So I I hop in and by that point there's maybe 50 people in this group and in the in the coming days it grows into the hundreds. And I'm posting like a big like, hey everyone, like like sorry to hear the, you know, all the chaos but like here's a tool. Like people are posting like spreadsheets comparing all the competitors. I'm getting in there making sure that our information is correct and Oh my goodness. So and I'm engaging.
Brian Casel:I'm asking people about their favorite features, where are the gaps, and I'm like totally engaged.
Jordan Gal:No. You got activated. Yep. Zero to 100 immediately.
Brian Casel:And there were not the you know, other competitors did start to do this, but I feel like I jumped on it faster than most of them. It clearly sent a a wave of activity every day for the last, like, three three weeks. It's been tailing off now, but, like Yep. It really, really helped. Wow.
Brian Casel:Okay. Like, overlaid on on this this three week period where we're getting a spike from from that, We had another random spike from like a an affiliate webinar that came out of nowhere. Then I go on a trip. Oh, then then we raise the prices. Okay.
Brian Casel:I won't get into it, but we screwed up some billing stuff. Uh-oh. And then but it was still good. Like, we were seeing the conversions. And then we go on the family trip.
Brian Casel:We're driving two days with the with the kids. And then and then microconf. And I'm fielding not just sign ups, but, like, a ton of messages. Like, hey. Do you guys have a mobile app?
Brian Casel:Can you do the payments like Volley used to do? Okay.
Jordan Gal:Okay. They're starting to evaluate.
Brian Casel:Yeah. Like, the and, like and how soon are you gonna have these features? Like, how and just every day. And and this is not just, like, Volley specific requests. These they're matching the same requests that I've been hearing for months from from other customers.
Brian Casel:It's it's literally what this market is asking for. So Yep. We're just trying to build and ship our version of these things as as quickly as possible. And it it you know, again, this is not like a hasty, like, let's shift everything. It's like, we've been planning all this stuff.
Brian Casel:It's just that the like, I I almost wish that this Volley shutdown would have happened, like, two months from now Yep. When we would have been further along in our road map. But, but we're still getting the benefit from it. And, and everything that I'm hearing from these folks is, like, we're still, like, one of
Nathan Barry:the most
Brian Casel:promising alternatives to to Volley. And and we're so focused on the coaching space that it's like perfect for a lot of these folks. But, know, the the pressure that I feel right now is now now we have four developers plus myself on the team. And each one of those developers has a different project that they're working on. Right?
Brian Casel:One is working on the domain change. One's working on the mobile app. One's working on the on the payments feature. I am working on all of those things with with each one of those developers. Like, I'm the UI UX product person on every one of these things.
Brian Casel:So so I am absolutely the bottleneck on everything. Not to mention the projects that we're doing on marketing. Yeah. And I'm and I'm fielding these these customer calls and and all this different stuff. Right?
Brian Casel:So
Jordan Gal:It's a lot of pressure.
Brian Casel:It's insane. It's kind of insane. Yeah. Like, and and I was literally, you know, on that family trip
Jordan Gal:Stressing.
Brian Casel:Not only stressing, but working. Like, more than I like to work when I'm on a family vacation. But frankly, I just I felt like I had to do it. Right? So not not full days, but, like, a good two two hours in a day, like, I'm in the hotel while my kids are on the beach.
Brian Casel:And I I didn't feel great about that, but I I kinda felt like this is this time sensitive opportunity that I have to be on. You know?
Jordan Gal:Abs absolutely. Look, the type of work and pressure that you're under right now with multiple projects, being a PM, being sales, that is the work we want to do. It's because there is demand and you are trying to satisfy it. Yep. Right.
Jordan Gal:That so that that part's good. And nice work on capitalizing, you know, to the extent that you could. Yeah. And, you
Brian Casel:know, the the other thing that I wish I I just wish I wasn't the bottleneck on everything, but I don't really see another way out of that. And I, like, I I I can't just, like, hire a new head of product because that's that's me, you know? Mhmm. Or even, like, hiring, like, a a UI designer for the app. Like, again, that's that's been me.
Brian Casel:So even if I were gonna do that, onboarding them, integrating them, it it would just slow us down. Right?
Jordan Gal:Yeah. There's no there's no escape.
Brian Casel:And I and I've already maxed out my ability to, like, add on more developers. Like, financially, we could add more developers. I just don't have the bandwidth to manage projects with more developers, you know. So it's just I'm at the max of what we're logistically able to work on at the same time. Yeah.
Brian Casel:I
Jordan Gal:I think that's worth, you know, from different angles. Yeah. Because there's there's definitely there is likely a scenario that you can come up with where one additional person can make a very big difference.
Brian Casel:Yeah.
Jordan Gal:That's I mean, it's a that's a guess at it's fuzzy, but I wouldn't be right. There's you can definitely increase your capacity. Right? You can you can double the size of your team and still be working all the time.
Brian Casel:Yeah. I I feel like what is actually really needed is a more higher level, a head of product or like a project manager on the dev person. Because the these are the things that I'm doing that take my hours. And and and, like, time is of the essence. Like Mhmm.
Brian Casel:We need to shift these things into the market as quickly as possible. Like, that's the thing that the business needs the most.
Jordan Gal:Yeah.
Brian Casel:So I I feel like that's the type of role that takes a longer time to to bring into the team. Like, you know
Jordan Gal:And you're making you're making the big decisions right now on how to initially put the product out to market.
Brian Casel:Yeah. And it's it's also not just building
Jordan Gal:like, this is what the product will rest on for a while.
Brian Casel:And there's the added complexity of, like, we are adapting our plot. Like, we started a zip message. Yeah. So it's it's not like we're just building a totally new thing from scratch. It's like we're taking existing things.
Brian Casel:We're reorganizing the UI. We're we're adapting the database structure of the models to accommodate this new vision for clarity flow, which makes every every feature even that much more complex. Plus, we're shipping to live customers, so, like, we have to make sure we're not breaking shit as we do it, you know. So it's
Pippin Williamson:Yep.
Brian Casel:And and I was talking to some folks at MicroConf where it's like, you could either go into a cave and build for a year or more and not sell and and have the perfect product at the
Jordan Gal:end of Don't that year do that. Don't do that.
Brian Casel:And and that's not me, you know. I I I build the skateboard and then turn it into a bicycle and then into a car. Right? And and we're selling the whole time. It it does make it more stressful.
Brian Casel:But it but you keep the momentum going. You know, not just the revenue, but you actually have a product in hand to have some customer conversations around figure out where you go next. So I I don't see it it's like a extremely hard way to build a business, but I don't see a better way to build the business, if that makes sense.
Jordan Gal:You know? It it does make sense. I think you're doing all the right things. And you put yourself in a spot where this type of luck, happens in terms of the, you know, the Volley, luck, and then you make the most of it. I mean, it sounds pretty damn exciting.
Brian Casel:Yeah. Like, to to
Jordan Gal:make the switch and then within a few weeks get an initial jolt of demand and eyeballs and opportunity and feedback. I mean, that's that's that's all you could ask for.
Brian Casel:It's been good. I I just wish it wasn't like so chaotic all at once and and a little confusing for people who are seeing us for the first time. Like, oh, because I'm again, with the name change, and I'm trying to ship this, like, fully redirect the site in the next week or two. Because I get the questions like, well, are you ZipMessage or Clarity Flow? And should I wait for Clarity Flow before signing up?
Jordan Gal:Yeah. You're you're you're
Brian Casel:still No. You can sign up now. We're just changing the name in the next few weeks. Like
Jordan Gal:You just gotta get to the other side of that.
Brian Casel:The the faster we can complete this, redirect and transition, the the better. Yeah.
Jordan Gal:That's right. Well well, we're not entirely ready for our competitor to go out of business. So if they wanna do it now, I'm okay with it. Yeah. You'll find it.
Jordan Gal:Walt wants to go out and point everyone toward us, we will figure it out also.
Brian Casel:Yeah. Yeah.
Jordan Gal:Alright. Well, that's exciting, man. Well, it's a fun pod. I gotta go I gotta go pick up my kids because I have them by myself all weekend, and I'm home and depressed because alcohol sucks. Alcohol sucks.
Brian Casel:Dude, that was me in Denver because it was like alcohol plus altitude was really rocking my world last week.
Jordan Gal:Yeah. And and,
Brian Casel:like, half like like, just lacking sleep all in the same week. So yeah.
Jordan Gal:Oh, yeah. That's that's that's that's handicapping your your brain power. Now we we went to a comedy show last night, which was fun. But when you're sitting watching comedy, what do do? You have a drink.
Brian Casel:Of course.
Jordan Gal:I woke up this morning, like, fully in depression. I was like, oh, that's why I don't drink alcohol anymore.
Brian Casel:Yep. There you go. Alright, folks. It's Friday.
Jordan Gal:Right. Great episode. It's fun.
Brian Casel:Yeah. This this was a good good catch up. Alright. Alright. Later, folks.
Brian Casel:See you, everyone.
