# Sub Club Podcast: From Consultancy to $10M in ARR — Vince Mayfield, Talking Parents

Channel: Sub Club by RevenueCat
Video: https://www.youtube.com/watch?v=RJbtWjEgN4g
Duration: 46 min
Language: English
Words: 9692
Transcript page: https://viewrankai.com/tools/youtube-transcript/RJbtWjEgN4g

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[0:00] hello I'm your host David Barnard and with me today Revenue cat CEO Jacob Eide Our Guest today is Vince Mayfield co-founder and CEO of talking parents an app that helps divorced or separated parents better manage communication and share responsibilities on the podcast we talk with Vince about the right way to raise prices the painful lessons from picking the wrong tools and why you should respond to every single app review Vince thank you so much for joining us on the podcast today I can't wait to chat oh I'm so honored to be here I'm a long time listener of the podcast so I'm a huge fan so it's

[0:39] amazing that I get to sit here and be on the cast with you awesome and Jacob freshly shorn you look like a baby without your three foot beer nobody respects me now because I'm cleanly shaming I look like I'm 13 but I'll take it I'll take it it's nice to be back everybody I'm the same person I today somewhere on the street stop me I don't even know and she was like oh you shaved I was like who are you that's pretty good it for those of you listening to the audio podcast you'll have to check out YouTube and see if the new and improved Jacob yeah all right so Vince I

[1:12] wanted to kick things off talking about the story of talking parents and how you went from a consultancy where you were grinding for that next client and just always doing work for other people always billing hourly or project and the way you told it to me when we were chatting before the podcast is that you wanted to make money while you slept and it's pretty great that you went from a consultancy where you were just grinding for those next clients to a 10 million dollar a year ARR business which it's just incredible so start me off with what was that motivation and how did you start that process of going from an

[1:52] agency to being a product company so my business partner Louis Erickson we've been best friends since middle school so we've known each other a long time we kind of decided we wanted to go off and start doing custom software development and so we developed this Professional Services organization about your nine we made Inc 5000 list and we kind of realized that when you had a business now we didn't have a hobby anymore and that we really needed to think differently we met this guy named Stephen Nixon and Stephen had graduated from law school and was a private practice as an attorney he'd been a prosecutor he'd been a defense attorney

[2:30] and he was in this practice with his brother and his brother was a family law attorney so Stephen shows up into court after his brother gets tapped to be a magistrate and there's two co-parents and they're going back and forth over this record of communications which once got text messages in one hand and Facebook post and emails and they're going back and forth and the judge is annoyed and both attorneys are racking up the hours and so the judge finally throws it back and says okay you guys go off on y'alls and you guys work this out and then come back to me so Steven sort

[3:01] of came up with this idea to build this app so he hired him guy working out of his house and I hadn't built it and then got about a thousand people using it and so he realized hey this is on service inside of this guy's house and when I call him he's not always responsive so he starts to get worried because judges are ordering people onto this software and he's afraid that it's going to come tumbling down or something so he stops into the Bank of America building where we're at and says hey I want you to take a look at this app we go in and we look

[3:32] at this app and we come back and we say hey man this wasn't built to scale it's kind of held together with bailing wire and duct tape but we think the idea is really cool what would you think about us forming a whole new company and let's rebuild this thing so that it will scale and so we came together and started to figure out how do we use the Professional Services to mutually support the app and then build the app up and take it from there how did that go transitioning from thinking like a Hired Gun to now we've got this product I think there's a lot of agencies out

[4:06] there who try and make the jump but it really is a different skill set how did that part of the transition go for the bit Wizards now talking parents crew it's a difficult transition and I will tell you for the first couple of years we didn't have the app monetized as far as a product we were thinking about you know when you build custom software you're just building things and getting them done and you're pulling in pieces and putting it together it may or may not need to scale to the level that this app did and so when we've started bringing in third-party components and stuff like that we really

[4:39] hadn't thought through all the things in the very beginning and that created some technical debt and really got us to start reworking things that we had already done before as we were trying to get that right product Market fit and I think the other thing that was different for us was we didn't understand really who our customer was in the beginning you're an agency you're used to having a customer who tells you what to do you're not as deep in the product you're not having to think who's our customer it's like well I mean you know who your customer is the person who's short on software development right that's

[5:13] ultimately I mean your customer right surely you need to align your goals with theirs but even the best person who wants to do the Best Buy everybody is going to follow their like most direct incentive which is very different I was wondering like before you had this opportunity land in your lap was this a goal for you to bring in to like own your own product product and this is just an opportunity it just was like right time right moment like let's do this or had you tried to do this transition was just like a strategic thing or just something like opportunistic when you're in a custom

[5:41] software business everybody comes to you and say hey I got an idea and we want you to build it for us but we don't have any money so you build it and we'll give you a piece of it and we quickly learned that our job was to be software engineers and not figure out somebody's business model or how they're going to work but we did have a couple of things that we had attempted one of them was a product where we became the sole reseller of it online we built the website did the stuff but it was actual physical product it had to be shipped it

[6:10] was called Tailgater carrier and so we did that for a couple of years we invested and it didn't work out we had to basically shut it down working with another group of guys and we knew we were just looking for that right thing that seemed like it made the right fit and that we could take and make money while we were sleeping yeah I mean I don't know the details but when it came to you and it says like this thing's getting out of control I can't handle the demand that yeah that's our priority product Market fit right at that point right like people always ask like how do

[6:39] I know I have product Market fit and there's varying levels there's different definitions of market right and how well the fit is in there but you know that moment when the product is growing despite all the problems right that's usually the definition that there's something there so whether you consciously knew it or not like that was the right moment and it sounds like like there was probably a natural limit to where this would go without your expertise right without some real engineering I mean I think it's really hard this Echoes against advice I've gotten and heard from you know investors in my world and stuff about it's just

[7:11] really hard to own a product and build a product without in-house engineering without being somebody in the driver's seat who's technical enough to drive the product forward and this is a good example of where somebody was short on that expertise and probably would have been Limited in how far they could take it yeah and I think besides just the product Market fit and understanding and having somebody that could do the software engineering and work right there with you I think another side of it was is that Lewis and I had already taken a lot of risk our business had been in business for 10 years at that

[7:40] point now we're at 25 years for bit Wizards and Stephen came from the law Arena where they're all in the risk mitigation business right and so you had a couple of entrepreneurs and people that understood that aspect of it what it meant to take risks and we were able to work work with Stephen and sort of get him outside his comfort zone so that we could scale this and make it go well so it was really mutually beneficial we really all fit together well but I will tell you we thought we understood who our customer was in the beginning but we really didn't and so that's kind of a

[8:14] good segue because we thought our customer was the court system yeah good luck selling SAS to the court system I mean well at least you know where they are yeah but if you go knocking on their door they don't look kindly upon that I guess it's probably also true well and they also only want to talk to other people in their profession you know it's kind of like a lot of regulated Industries they've got older technology and things like that but we knew that they were a Channel or an influencer so initially we made the application free and Steven thought we were going to monetize through Google AdSense and so

[8:48] we came to the conclusion pretty quickly I said hey look everybody in that courtroom is making money we've got to make money to scale this thing so that we can fuel it and build the features and functions that the customers want but our customer isn't the court system so we changed and decided to monetize based upon the apps and get a subscription model going and when we did that and put the focus in the customer and the people that were actually giving us money in fact I had a professor at Notre Dame that told me he said strategically you know who it is they're the person that gives you money they're

[9:25] the ones that are in the driver's seat so it's amazing how we have to sometimes we have to go learn these lessons from fancy professors when it's like absolutely it's like right in front of you right so when you say customers you're talking about the parents right like the folks that are in a co-parenting Arrangement that's absolutely correct in those early days when you introduce a subscription you still did use a freemium model right so tell me about your decision making around okay this is never going to scale big enough to make meaningful money on ads we're going to use subscriptions but we need some hook so how did you think

[9:59] about freemium early and then I'd actually want to go through the different phases of your freemium strategy as well well Steven thought that the basic messaging part of what we were doing was the core item and we were already given that away for free through the freemium model so we said you know when we decided to monetize you got to remember this is 0.9010 11 right and apps are coming out and so we're like okay so we're going to build some apps and apps have notifications which you didn't really have them very well over the web so it started as a web app it was it was like a full web experience

[10:33] before okay exactly and so we said okay so now we're going to give the mobile apps and the incentive is going to be well if you want to use mobile apps then we're going to charge you for that on a subscription basis and there was some discussion that went back and forth about whether we're going to charge a one-time fee and what the price point was I mean at that point in time it was like the market was not really there for charging consumer subscriptions on mobile like I don't even think that technically have any subscriptions on the apps are told 11 or 12 until it was

[11:01] everybody was able to use it yeah and so we went through a lot of argument back and forth about how to do that and then when we finally did get it monetized and get it on a subscription it was closer to 2015 when we finally got that working the way it needed to work so we probably burned through close to a million dollars revamping the app starting to Market we were literally sending Stephen out around the country on an airplane to talk to judges and Clerks of Court and stuff were you not monetizing at all through that period no not really all we were doing then we didn't really start

[11:33] monetizing until the end of 2015 beginning in 2016 other than through the Google AdSense Revenue oh so you did have a little bit of that I mean normally AdSense has a strategy or ads as a strategy doesn't really work unless you're mass mass Market but then I was thinking like this kind of could be mass mass market right like there's got to be millions of people in this Arrangement right that could potentially use a co-parenting app yeah they weren't necessarily divorced they couldn't had a kid together and never been married it's got to be a bigger Market than I mean everybody could probably take more than

[12:04] two hands to name people they know in this situation right which is a larger addressable Market than a lot of like a lot of apps we talk to right so you had that going for you I don't think it was totally crazy but you guys were pouring r d budget into this thing like were you like pouring effort into the app for those five years like as you were just building that functionality was it kind of on the back burner or like how are you approaching it we first revamped the web app and then we went in and started doing the mobile apps on the latter part

[12:32] after a lot of discussion and some of the things that we did early on that were really important we started asking customers at least surveying them and saying okay what do you want what would you pay for what features or functions do you like how can you know this be better for you it was pretty rudimentary nothing like what's available today it was just simply a couple of software engineers and a legal guy sitting in a room saying okay well what kind of questions we want to ask customers so we started to get that survey data back and figure out and solidify what we wanted and when we released the first app I

[13:04] personally felt like we were charging too little for it which caused some problems later on because as we started to add more value and more functionality and figure out how to build out our tiers and give customers a compelling reason to not only utilize the app but stay on we had to deal with some of that Legacy stuff that we were doing from before when your app is free now you're charging 4.99 and then later on you want to charge them 9.99 and now we have two tiers where it's 9.99 and 24.99 and so how do you manage customer expectations how do you deliver the value to them so

[13:37] that they feel like that they're getting something unique and that they're willing to continue to pay for and stick with you when the app had fewer features and didn't have as big an audience and product Market do you not think maybe it wasn't right option to start at a lower price so you're talking about tech debt in that the price was lower and having to transition to a higher price it's kind of a combination of tech debt because you have to manage the subscriptions and like business debt of like we used to be a different app now we've added all these features but do you think maybe that was actually a

[14:08] better staging of the app to start low and then move forward versus do you think you could have gotten 25 a month in those early days like is there regret that you should have been charging 25 from the beginning do you think you really could have done that I think we could have monetized sooner I'd like to tell you that what we did was genius and it all worked out the way we wanted to where you're supposed to that's what you do when you're taking your Victory lap that it was all clear the whole time through your Genius but the reality is is that we stumbled through it and we

[14:37] just made mistakes and you know there was a lot of argument and discussion and back and forth and there were some lean times where you know I had to tell Stephen at one point I said hey I can't continue to pay you a salary right now times are lean and the Professional Services realm so monetization has to be a strategy and has to be something important that we're doing and I would say that from 09 to probably 15 although we rebuilt the web app we dabbled and it really wasn't until 15 that we got things monetized and really started getting them going and then we started

[15:11] adding in more features and that type of stuff it was stressful they got better as we made money you know they say money can solve problems when you're pulling up by your bootstraps it does and the smart use of that money and making the right bets is what's important on the point of starting low and going high versus starting high and going low the device I always give is start high because like the worst case scenario is nobody buys it right and then you're giving people a discount right versus the flip side is you give everybody some price that's way under the True Value you've now set the expectation that like

[15:44] hey this is only worth 4.99 a month which I would imagine is a fairly High retention user base like yours like for some apps that are Turn and Burn I use the word churn and burn with love right apps that maybe don't like focus on super long-term retention like you can more freely experiment with prices because your customers are kind of cycling in and out but for an app where the expectation might be that somebody uses you for 18 years right or some really long period of time setting that expectation matters right because you're going to have that customer relationship for a while so yeah normally I'm like oh

[16:15] just respect your existing users but feel free to mess around but in a case where you might have a longer term base like you might want to be more careful I just find it's always easier to make things cheaper like nobody gets mad at you right you're gonna have the same amount of tech debt and business debt by like reducing a price you're going to lose money potentially from existing users if you bring them down but like at least the emotional labor is less right you're like lowering the price and you're still trying to find that Optimum right you're still solving the same problem you're just coming from a

[16:42] different starting point on the curve but when you have like really deep product Market fit and you've built out all those features then you do actually have very few people who complain when you raise the price and that's the next part of the story I wanted to get to is that you did end up raising the price on all of your existing subscribers tell me about how you planned that and then how did it go again at the beginning we didn't have a lot of instrumentation and we weren't really sure to Jacob's point the people that are with us are predominantly court ordered so raising prices when it's already low is tricky

[17:14] because they're already mad because they're typically in a co-parenting relationship not all but some of them are so it's a very delicate matter to raise prices and go forward we were actually surprised we said okay well if we lose half of our customers as we raise the price from 499 to 9.99 what is that going to do to our Revenue what's going to happen and I've been to some pricing seminars and stuff like that and talked to some different people and I said there's no way that's going to happen right so we just sort of planned that we would lose at least half and what we're presently surprised is that

[17:45] we got a few complaints but actually people understood that when we rolled it out we added additional value so when we first rolled it out our 9.99 plan we added in what we call call accountable calling which allowed people to be able to make phone calls and have it be transcribed and made a part of the record so it was more than just the messaging that was going back and forth over or keying it in and so every time we've raised prices or every time we've busted out to tears we've made sure that we've bundled that with a group of value that somebody would get that the

[18:20] customers had asked for from us surveying them so we could say hey look yes we're raising prices but we're bringing you new features and functions that you asked us for and we're listening to what you're having to say and we're making sure that it's a value to you so turns out we maybe lost a quarter or so and maybe some of that was transitional while they were mad and then they came back because some of them and I would probably venture to say it's probably about a 60 40 split but 60 percent are court ordered about 40 percent or not but we always offered a free version if you wanted to use the

[18:55] web version you could get it for free so he said okay if you don't want to pay for the extra features here you can always go back to the free version and you can use it and that satisfies court orders in most cases yes sir that's a huge lesson right there though that I think a lot of subscription apps now that you can more easily raise prices are not heating if you're Netflix yeah you can like increase the price 25 just because your Netflix and people are going to stay subscribed but bundling any price raise with like clear additional value I think was a good product marketing right it's like

[19:30] you probably already shipped a lot of apps yeah I know prices and not do it I mean it goes back to um you know something we've been thinking about our Revenue got a lot of recently it's just like negotiation tactics and like as we're closing deals like how do we create non-controversial interactions with customers as we're trying to like come to a partnership agreement and there's certain ways you can present you know it's pricing it's all pricing right it's like presentation of pricing it's so psychological already you have as an app developer a lot of surface area to influence that psychological experience variants if you say like increased price

[19:59] you know an increase price with an increase in delivered value is not actually a net loss for people right they can opt out on a liquidity basis like that Surplus value for me I do not need right and they can choose to opt out but you know in most cases you know if you're surveying users and what you think of is good then what you're building is hitting their needs so it's not going to be the case right when were y'all doing this I guess was it recently so we've made some additional changes when we went to the 24.99 tier that happened at the end of

[20:27] 2022 Okay so we've now been doing it right about a year and about six months or so but that's a second tier right so you have the 9.99 tier so you doubled the price from 499 to 9.99 but now you have the option in the app to get the 999 tier or the 24.99 tier correct that's correct can you talk a little bit about like what did you bundle into that like what are you targeting with that tier so the way the free tier worked is that we have the record and so when you want to go to Court then you buy a copy of the record from us we will either

[21:01] give you a digital copy or you can download it as a PDF which a lot of Courts won't take and then the other option is to do a printed copy so we would actually print them out bind them do an affidavit and then ship them to them when we went to the 999 tier from the 499 tier we basically structured it so that you got a Deeper Discount on plated records because printed records cost us a significant amount of Labor and effort to go and do it but then we also added in calling and then when we went to our 24.99 tier we added in video

[21:32] calling and it's not just calling there you got to keep in mind that what we're doing is we're recording the call we're transcribing it we're making it a part of the record we're breaking apart the channel so that you can see all them and then it's put in a format that if you do go to court the court can actually see how it's all broken down by dates and conversations so what somebody said if you call your spouse out or former spouse out in there and say something ugly well the Court's going to see that right so the idea is that it's reinforcing people to be civil and so we

[22:06] carefully picked each one of those items so video calling is expensive for us because you know you've got to store that video and you've got to store that audio so we made it so that they got a bundle of minutes and a bundle of time that made really sense and then we could take it up each level as we went forward so that was the primary again it was like adding and creating value right and then pricing that value actually capturing that created value which is you know five times what your original price point was right now for that new service but depending on the situation

[22:38] that you're in if you think about a tool that's going to allow you you know if you're in a contentious co-parenting situation or whatever allow you that freedom to video communicate makes a lot of sense and so how has that been is I finally having multiple we have multiple pricing tiers here and like old ones and new ones and I find I need to be like super hard to like wrap my head around how did adding tearing make your lives Better or Worse potentially more complicated I don't know that it made it more complicated I think what it organized our customers around people that understood what we were doing and

[23:12] got the value and were willing to pay the higher price point to it so we cater to all the customers but we added other features in too I didn't mention this one but we actually have accountable payments so they can make payments for child support or alimony and it's all tracked and it's all part of the system and you're at the 999 we charge less for that because there is some per transaction charges for us and then we charge even less when you're at the 24.99 tier so I don't know that it created a big problem for us I think the bigger problem for us was trying to

[23:46] extricate the old 499 customers and get them up to the new level it's like you always said it's harder to charge people more money than it is to reduce the cost right yeah I mean 20 Gap is massive right for that five dollar user if you're staring and being like well I get this for five it may not be five times the value right but it still might be worth it if that makes sense to them yeah and interestingly what we found out was is that most of our Apple users were on the higher tier you know if you think about it you pay a thousand or almost

[24:17] two grand now for an iPhone with all the stuff on it we found that we had more customers over in that room and we could see where certain customers were more price conscious Vince when you're talking about the pricing in 25 a month on the premium tier and like how much value you're having to deliver it's just reminding me how much opportunity there still is for subscription apps to deliver a ton of value and charge for that value I think of speechify the Texas speech app they charge 120 a year I mean a couple years back I was like holy crap that's really expensive but it

[24:53] delivers a ton of value and for those of you listening to to the podcast there's a lot of nuances in talking parents business it's not going to apply to your specific business but you should be looking for these opportunities to layer on deeper and deeper value because there is still so much opportunity to increase the value you're delivering and then actually charge for it because 25 bucks a month for a consumer subscription app but you're delivering that kind of value you're delivering sophisticated video audio transcriptions all that kind of stuff it's for affidavits I want one thing I wanted to ask you Vince so like if one parent has a subscription does

[25:32] the other one get access to features or is it all for like one side of the match it's one side but it gets the other parent a reason or incentive to maybe want to go to the next level so if they're at the 999 tier they'll get calling but they have to be at the 24.99 tier if they want to get videos so one parent may have video and the other one may not or maybe they want to have a video chat with their kid where the other parent doesn't necessarily have that capability we're trying to reinforce where that value is and get them to move up the chain there and

[26:04] subscribe at that particular level but if they can't afford it and it's not at their level they can get the features at the level there so even at the Free level you know there's ways for a premium person to talk to somebody at the Free level and some of the things that we're talking about doing is figuring out a way to let one co-parent pay for the other co-parent which is complicated it is because your land yeah yeah because some people think that well first of all the parents don't want to be controlled by the other co-parent right so there's some nuances about what we have to do to help navigate this but

[26:36] I want to make one point about what David was talking about with value and that's that you know one of the things that we found about people is that they like to compartmentalize elements of their life and they don't want to have a million apps right and so co-parenting is a very important aspect you're shepherding young lives between two people and you're trying to keep it harmonious and keep yourself out of court the value that talking parents brings there is its accountability across all those communication mediums into a record that can be utilized in court and so at each level the parents can pick and choose the features of the

[27:12] values that matter the most to them and then that they're willing to pay for in order to help them manage this like I said we noticed that some of our Less Price conscious customers typically on Apple you got two co-parents one on each side pan 24.99 for it but I would also say it also costs us a lot of money to deliver that right there's consumables there that I have to pay for in my unit and in my economic cost and so it's priced in a way that allows us to deliver that premium experience for them at a price point that they're willing to pay for and that I can cover the costs

[27:45] and still make money you're talking about nudging those parents who aren't paying to pay and now you need both parents involved and I imagine there's a lot to understanding the usage of the app how do you instrument that how do you figure out what your customers need so initially I told you we did it it's pretty rudimentary we did surveying and Survey Monkey and that type of thing there was a lot of discussion about what we thought and we kept telling ourselves and especially when I hired my my new director of marketing Heather Ruiz she came in from the business to Consumer field and you know that's different

[28:21] obviously from B to B it's a different mindset in a different way that you market and she really solidified that we had to get back some instrumentation and really truly instrument the app and understand the customer Journey not over instrument it but basically have the things that so we understood what that was we started with adjust but the problem with the justice is that it's centered around that app download and for us that isn't a conversion point from us they can download the app but it's not effective until they match with a co-parent and they're talking we put Firebase in place and then we started looking at and sort of did a fly-off to

[28:59] see what do we need for a platform and we looked around and we saw that everybody's using segment right we kept hearing segment over and over again and when my software Engineers looked at it they're like hooray it's a giant database it stores a bunch of stuff in it and we can aggregate it and make it anything we want and my marketers went time out we don't want to be building uis and having to integrate with Tableau or power bi or something like that we need a more accurate picture across all the platforms so we ended up boiling it down between segment and a product called Bloom reach Bloom reach is a

[29:34] customer data platform which is a little bit different because we're having these problems that are happening right now with privacy and with third party and so this allows us to have basically first party data we believe that first party date is King it allows us to map what's going on with the people that come to our website and then track our customers as they go through that Journey so we did all that instrumentation in the last two years and it's really paying dividends and helping us understand how our customers think and what they do and in addition to that we've also created sort of a community where we're giving

[30:08] back something more than just the app so some of the things that we're doing is like our coffee and co-parenting and we're bringing in F experts like Dr ramadi or Mark Pearson who's a renowned negotiator and counselor and an influencer like Caroline Kelly and brought them in to provide that value to our customers through our coffee and co-parenting so that they felt like they were getting their video series or was coffee and co-parenting so coffee and co-parenting is like webinars that we offer periodically and then we bring these experts in and provide that they'll take over our social media or take over the blogs and bring stuff in

[30:45] and interact with the customers and you were mentioning that in relation to bloom reach is that something you're actually tracking In Bloom reach to understand kind of the impact of that community-based marketing basically absolutely so it's tied into our social media it's tied into all of our advertising so all somebody has to do is come to our site once or one of our landing pages and then we can track their history and what they're doing over time and then we know when they convert and what that Journey looks like for them deciding on Bloom rich and doing a bake off it can be a challenging Prospect with engineering battling with

[31:22] marketing battling with the business team and got pricing and who's going to lead and all that kind of stuff how has that gone as you've evolved the tooling like going from one tool to another and figuring out like what's actually going to work best for your business we've made some mistakes as we've gone through this being software engineers and you know having an attorney as part of the company being a little more risk adverse on things you know we always looked at what was the cheapest and what was the easiest to integrate right from a software engineering perspective and cost there's a couple instances where that kind of burned us and so one of the

[32:00] is that we have an audio translation service and the company that we use now is called assembly AI but we had a previous one that was a startup company and we didn't pay particular attention to the unit economics there and we didn't pay particular their attention to how it might scale and so what ended up happening is is that we started having problems with transcription and we started having disconnections from their service and we had to go back and we found that cheaper isn't always better right so we actually made this transition to assembly we cut our cost in half and we got more features and functionality out of it

[32:40] because instead of they would charge us for each channel that we were transcribing whereas under the new system it charged us under dual Channel and allowed us to go through so the learning from that is to make sure that you understand clearly what the unit economics are what it's going to do to your cost of goods sold and to make sure that you're not you know from a software SharePoint sounds cool that we're going to hook up with another startup company but if they can't scale when you're scaling you've just added a problem to your scaling and we've had to go back and re-engineer as a result of that and

[33:14] it's happened in more than one occasion I have to imagine on all the train I mean this assembly AI sounds like it's probably new I'd imagine the costs are going to come down on transcription and stuff right now because there's just so much Innovation and AI audio video stuff right now there is plus it handles multi-language which is another feature and function that we want to put in but I have to put some props in there you know Revenue cap was the first tooling that we integrated to basically help us manage our subscriptions we tried to build that ourself and it was a huge mistake it was a debacle we were running

[33:45] around chasing our tail every time Apple would change something or every time Google would change something it was just a night now we chase our tails for you that's how it works except and the price doesn't go up when that happens so that's the benefit it's de-risked exactly well I mean you scale with us as we scale and so that's what I'm talking about paying attention to how that works and that was the first and then I mentioned assembly I The Other Woman swim we had another startup that we worked with to help us with our video right when we're doing our calling it was our Flagship feature we

[34:16] underestimate a little bit what the cost was going to be to store the video over the Long Haul we have some unique things with the co-parents that we want to mask location and that type of thing and mask the phone numbers and you know we have issues of trying to mux all that together and so we want this other company and they were great they're really nice but we started having problems with our Flagship feature and we had compared them to twilio and we decided we're going to go back with this new startup and we're going to help them out we're going to work with us and go forward but the reality is

[34:48] they couldn't scale with us and so we ended up making the transition to twilio and the advantage there is now I've got a Global Network at scale that I can actually integrate in with so I would tell other Founders if you're a software engineer by trade you know your tendency is I want to build it myself and the answer is don't try to build it yourself you find It Best in Class don't chance on the money and make sure you pay particular attention to the unit economics the other thing that I would say that it's really important is I tell my Engineers all the time why are you

[35:22] spinning your heels on that call Revenue cat or call twilio right this is why we pay for support right these are the guys are the experts in their product let's utilize that and I don't mind paying some extra money to be able to have that because if I do that then my Engineers are off developing new features or functions for my you know customers that have a higher Roi I think this is something that I'm glad it sounds like you guys have made that transition I see a lot of companies that are I don't want to describe it they're somewhat dogmatic about it right about never taking things

[35:54] from the outside and there's legal reasons right there's risks where you just identified there but like folks always like ignore they over index on the risk of the startup that goes out of business which can be mitigated right with a couple easy checks like I'll say this for folks evaluating Revenue cat or any tool if the company's not public if they're public you can just look at their financial position right you can see how much cash they have you can kind of understand their insolvency if they're private if it's a startup ask and if the salesperson will tell you say like let me talk to your founder I want

[36:22] to know which like how much money you guys have we do fewer of those conversations now but in the early days I was like had to get on a lot of phone calls and be like listen I only have seven hundred thousand dollars in the bank but here's my plan right like we're we're settled like if I had to you know we needed to lean back we'd be profitable like the businesses you know it which was hasn't always been the case for a lot of deaf tools right it's really good to hear that you know you've opened up to that because like I think a lot of people do themselves a disservice

[36:46] like the whole economy and since the Middle Ages is based on they're not even pre-middle ages since basically The Agrarian revolution has been based on specialization right and we've entered this period where with software it can happen at like a different way right like specialized crafts people can be trading information in real time and then metering and exchanging that and that's kind of what's caused the explosion and value creation that we've seen over the last two thousand or ten thousand years so to deny that and be like oh we're going to build everything in-house like deny is something that's been working really well again conditioned on the risks right

[37:20] conditioned on doing what's right for your business and and then also you learn how to do good vendor integration right where you're defending yourself a little bit you're being like yeah we're gonna put this in we're going to isolate it a little bit so that we have that optionality if this vendor doesn't work out for us we can easily switch over to another or we can bring it in-house if we have to and stuff like that your r d dollars should be going into ipe which beats the market right which is creating extra margin and extra value for your customers because like just solving the base needs of the business probably

[37:50] isn't going to bring a big return for that dollars absolutely and I have a lot of scars to prove that it took me a long time to learn that one of the frustrating things though about the subscription app industry specifically you said you should just go with Best in Class tooling but so many of the best in class toolings that I would generally recommend to you know folks just starting out you got to start off with like a thirty fifty thousand dollar a year Enterprise plan to even start integrating the tool and I wish some of these bigger kind of Best in Class companies like iterable Embrace on

[38:26] the customer journey and customer data platform side and even some of the bigger like mmps and other things like that I wish there were more companies open to that kind of let us start with you and grow with you instead of like you can't even implement the solution I never I did like don't tell me because I do it out of a moral imperative right I have to believe that long term it will net out right but a lot of these companies they just because typically those 50k and up those Enterprise contracts like you can build a go to market motion around that and it's typically pretty efficient and

[39:00] relatively easy to grow compared to like a Bottoms Up motion might take forever and be very costly yeah and twilio is a good example of like there are still tools out there that charge on unit economics that can work if you're delivering value and making it you know you scale with them you don't have to sign a sixty thousand dollar plan just to get started but yeah I wish everybody could just start with Best in Class tools so it's a trade-off Mission really early on you can't always start with best-in-class tools but it's cool to hear that you're actually still using Firebase because that's something a lot

[39:30] of folks start out with and then eventually move on to a mixed panel an amplitude a segment or something like that but at least there are tools like Firebase where maybe the best in class at everything but they're good enough to take talking parents to 10 million in AR absolutely I think the key thing there for those that can't necessarily get the best in class in the beginning because because she just can't afford to do it it's just follow good software engineering techniques in a way that you can actually pull stuff out as you go because the app you are when you're in your first year versus your second or

[40:03] third year you're going to iterate several times if I had a dollar for every time we changed around technology or kind of did something and I think that was the benefit of us going back and re-engineering it in the first place was it allowed us to do that quicker I'm not saying it's not problematic it is there's certain paradigms that we haven't been able to pull out but we were able to integrate certain things in and then switch them out because we designed them properly so that if we had to go from one transcription service to another we could if we went from one video provider to another we could and

[40:34] what some Founders do is they get in a big hurry it's hurry up and get it to Market as quickly as I can which I understand but at our point we kind of already knew that we had a market and a fit and I think as we were going through we were making sure that what we could do would scale and that we could change things out as we moved along we do need to start wrapping up but I want to do a quick lightning round because I think you have some really insightful points here with talking parents I know customer service is super important and

[41:02] I don't think enough apps take that super seriously so give us the 90 second why do you care about support and then how does that actually translate into how you run your business and how your customers respond well I'll say first and foremost that I think that every experience that somebody has with your brand sets a mental image of who you are in it and so you know if I'm going to charge a premium price then they need to have premium support right one of the things that we've done that I think is absolutely important to us and we didn't do it in the beginning and we've only

[41:34] been doing it in the last year and a half is that on app reviews we go in and reply to every app review with a human response right even if somebody's just complaining just to complain or they're complaining about their co-parent relationship or something has nothing to do with the app but I want my people I I have my marketing team meets once a week with my customer experience team and they respond to all of those and you know obviously Google gives us less characters than say apple does but people then feel like they're heard and you're not writing it to answer just that person you're writing it for

[42:08] everybody that comes behind it and if you've got a thoughtful reasonable answer that empathizes with that particular person then there's more of a chance that they're going to come back and they're going to think highly of your app and I would say we do the same thing with our app it's email support only right now but one of the things that we're thinking about doing for our higher tiers is giving a phone support and if we do that we'll add that in and treat it with the same care so our thing is about radical focus on the customer because again as I said before they're the ones that are paying us for the

[42:41] service and so if they feel like they're heard and that we're listening to them they're going to continue to stay on subscription with this or we're gonna have great retention rates it's amazing David is the whole point of this whole project people making software that helps people and then paying for it it's the dream that's all we want right it goes back to the you know their customers who pays you it's true right and reflecting on you just had Vince about our own support we provide email support to anybody just signed up you'll never make us a dollar all the way up to our biggest customers obviously there's

[43:10] some gradations there and we kind of like adjust resourcing depending but we always want to get back to people within a few hours no matter if they're just lost and trying to figure out how to do it and the reason being is because it goes back to what you said it builds that brand right it's like we're establishing a relationship with a community of users and how you react to them and how you're able to treat them whether it's visible or not or whatever they'll tell their friends really matters and really compounds especially when you're serving like you guys a somewhat Niche Community you have to

[43:39] maintain that like people have to have a high NPS of talking parents if you want your business to take off in a community where people are probably exchanging information a lot so it's why I don't look at the unit economics I don't want to know right like yeah you were talking earlier events about making sure on tool you know the unique economics and again I think too many apps sleep on how important customer success can be to building a great app Business and so I think it's really great that's a huge Focus for talking parents and even if it is a quote unquote money loser in the like

[44:13] hour by hour unit economics it's not a money loser in the long run so it's really cool that you're focused on that yeah I consider it table Stakes if you're a good business yeah it's a cost of doing business and when we hire people we try to look for people that have a lot of empathy because it's a tough job right yeah we complain about you know iOS developers sometimes being cantankerous and whatnot I can't imagine like people already potentially where they're coming from why they ended up in that app and then they're having a frustrating moment like I I've got to imagine your customer experience team it has to be a very

[44:47] special kind of person yeah and I think there's an altruistic nature to all of us here because a lot of the people in the company are co-parents and so they understand what it's like to be in that environment we want to make co-parenting better we want to make people's lives better there's an altruistic notion to this I mean obviously we want to make money we got to do that to stay in business but we also believe that our app is delivering value that makes people's lives better yeah and ultimately you know helping kids right in a potentially tough situation you make me want to wear you guys any jobs

[45:16] open kind of excited it's a good Mission yeah speaking of that actually do you have any jobs open we need to wrap and if there's anything else you want to share as we wrap up well we're always hiring I have a thing that I'll always be hiring looking for good talent good people so I would love for people to come check us out at talkingparents.com and we try to find a spot for good folks if we can make it work and from the economic standpoint awesome well Vince thanks so much for joining us this fascinating conversation fascinating business I got to talk to you for like an hour and a

[45:50] half before the podcast and just such a fascinating business and really great all the insights that you shared today so thank you thank you and I appreciate both of you having me on today I'm honored thank you Jacob thank you David thanks so much for listening if you have a minute please leave a review in your favorite podcast player you can also stop by chat.sub club.com to join our private community foreign

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