The AppSumo Treasure Trove with Ruben Gamez

0:03(upbeat electronic music) - So we're going to kick the day off with a talk from Ruben Gamez, conversation between he and I about his AppSumo deal. Rubin is such a good framework-thinker. He's so deliberate with his decisions that, you know, I really, really wanted him to be part of MicroConf Remote and to talk about how really,

0:27how he decided to doing AppSumo Deal. We talk about maybe when to think about not doing an AppSumo Deal. And then he goes through all the numbers, the revenue, the number of signups, number of support requests. It really wound up being good. I think we will dive in. So let me welcome Ruben Gamez from both Bidsketch and now these days he's focused on Docsketch,

0:46his electronic signature app and let's roll. Ruben Gamez, thank you so much for joining me here today at MicroConf Remote. - Happy to be here, thanks. - So for folks who don't know, you are a multi-time SaaS founder, you still have Bidsketch which is proposal software and then Docsketch is what you're working on these days

1:08and that is a electronic signature app. So folks, you know, who have used DocuSign or HelloSign will have a pretty good idea of what Docsketch. Obviously you have some differentiators from those tools but that's the gist. - Yup, exactly right. - And you ran an AppSumo deal. When was that? - So I was looking at, that it was May 2019,

1:32so almost two years. - Okay. Couple of years ago. Yep. And what's been cool is you've been super transparent with a lot of the stuff around that AppSumo deal. And probably most importantly, rather than, I mean we're going to cover all the numbers and the ins and outs. But you've been transparent with your thought process of when you should consider what you, you know the pros and the cons and here are things I might do differently and you know,

1:56you and I spoke on Startups for the Rest of Us about it. And then you've actually given some advice to, you know some mutual friends that you and I have, some TinySeed batchmates as well when they are considering AppSumo deals, you know, what to think through. And so that's really what we want to capture today is the thought process of, you know

2:15things to think about what it actually looked like for you. You know, how many sign-ups did you receive in what amount of time, what were their support? What was the support burn like? How did you handle that? And how much money you made. A Lifetime AppSumo Deal. So this is your decision process and kind of some things that you think about, you know assuming I know you and I have both

2:37done multiple AppSumo deals, I believe. So what are your criteria and what's your thought process around this? - Yeah, I've done two with Bidsketch and one with Docsketch. So I was already pretty comfortable with doing AppSumo deals. There were a few things that I had to think through and I ended up researching just to make sure that it was the right thing for Docsketch

2:59but AppSumo has changed a lot. So it's much more a community and there are just certain aspects that are much bigger deal than they used to be. So nowadays, I mean, the main thing that I looked at was what are we going to get out of it versus what could we, you know what could end up hurting us longterm or, you know

3:20be tough for us to deal with long-term. Obviously the money when I talked to AppSumo, they told me that on average. So this has changed too. You make more money on the Appsumo deals now, nowadays, which is pretty cool. I guess their list is bigger and they go for longer period of time. So they said that for us, basically, you know

3:41it depends on how much you're charging for the deal. It's pretty standard, what you get for each, I think I was 30% but nowadays they're doing 25% or something like that. And then it can change after that but it was basically, turned out to be about 20-50,000. Was the average deal, you know, in revenue numbers

4:04based off, they didn't give me that number in revenue. They just gave me the number in buys and based off of like what we would be charging in our cut and all that stuff. That's around what I figured. Okay. If we fall in that average, we'll get something like that. Rob: And that is net revenue to you?

4:21Ruben: Right, correct, total. Rob: That number, right. Ruben: Yep. Then the other thing that we were thinking about was just like, of course the reach, they have a really big list. There's a lot of buzz going on when you're doing the deal. A lot of people see the deal, see your product, they try it out, you know, helps word of mouth,

4:38helps other marketing efforts, things like that. Exposure also to other segments and we have a very horizontal product. So we'd been talking to a lot of different segments in the market, talked a little bit to real estate, more business offices like accountants, lawyers, things like that. Their deal really just brought everybody from all sorts of industries. So that was really interesting and actually way more useful

5:09than I thought it was going to be. So that was one of the good things, the bad and the reason why a lot of people don't want to do the deal. And I wouldn't even say it's bad as long as you're thinking about it the right way is just life. It's a lifetime deal, they pay once and then that's it.

5:26So then support for lifetime, right? The best way that I've learned to think about that is just to think of those as free users. So if you're okay with doing, having free users or doing a free plan for short period of time but keeping those users around, then you'll probably be okay. And that means that

5:47there isn't a high cost to support these users. So that's a really big deal. You don't want it to be super high touch, right? You get 3,000 people that you have to, onboard and you have to set up these calls to onboard them properly or else they're going to have a really bad experience.

6:03Ongoing support is really low. So, you know, it's not costing you money in some other way, you know, support or for every like core action that they take for us. It's sending documents and getting those signed. There is a tiny, tiny, tiny cost there because we use some third parties to help with that. But it's totally okay because we have the viral component

6:24and that's another thing that could be really useful. If you have the viral component then the more people will use it, that's why freemium plan works really well for us. The better is even without a free plan or even without the viral component. Like, it's still the word of mouth that you could get from that, the buzz

6:42and all that stuff can be worth it. So I wouldn't say that it's necessary but we weighed all that out and just decided that it was a good, good, good thing for us to do. - Right. So it sounds like some of your pros are, you do get an influx of cash and for a bootstrapped or mostly bootstrap company, you know, netting 20 to 50 grand for four weeks of work,

7:03it can allow you to hire someone. It can allow you to invest in ads or whatever. So there's a benefit there, the exposure both to the AppSumo audience and also to the broader world can bring in, it can give you backlinks for SEO. It can also bring in, I mean in my experience, there were folks who signed up outside of the AppSumo deal during this time that I really, they couldn't attribute

7:24like just the direct traffic went up. I'm not sure if that's still the case these days, is that your experience? - Didn't really happen for us on Docsketch. We did launch shortly after that. Then we closed it back down, but definitely, less of an effect with Bidsketch that happened. - That was a big deal. Yeah. And then, you know it sounds like in thinking about it, if your app has heavy onboarding at the front or maybe a long time for people to get value out of it, and they're either expensive to onboard or support

7:57or there's an incremental cost. And of course, I always bring up the example of Drip where every email we sent was a particular cost and onboarding, you know, to truly onboard into a marketing automation platform is pretty time intensive. So the Drip would probably have been a less, Drip is marketing automation software obviously, would have perhaps been

8:15a less ideal candidate than Docsketch. - [Ruben] Yep. Yeah. I would have, if I had a product like drip, it would have been really tough to do a deal, I think because you have to think of it the same way as doing freemium, right? Like you did freemium, I think, after the acquisition, right?

8:36- [Rob] Yeah. - [Ruben] Because there's a lot to it. If you can do freemium. - [Rob] Yeah. It was too expensive to do upfront. - [Ruben] Yeah. - [Rob] Cool. So then talk to me about preparing for 800,000 people to check out your deal. How do you even mentally go about that? - [Ruben] Yeah, that was the list,

8:55size of the list at the time. And I know that they trimmed the list and all that stuff. So I don't know, you know, if it's more now but there's still a lot of people checking out your deal, signing up, you know, looking for support. So one of the things that I did was just research, just you know, it was a much bigger list than I'm used to

9:14and so I wanted to get a feel for what the deals were like. And I talked to other founders that have done deals. You introduced me to somebody from LeadPages who had done deal. I reached out to people and AppSumo Slack. They invite you to a Slack. So you could just, you know, direct message people. And what I did was just look at SaaS tools that were kind of similar,

9:34as similar as they can be to our tool. 'Cause I figured that they might have a more similar experience that they could share. So I learned a lot that way. That was cool. And then I just looked at, I asked the AppSumo team what are some deals that went really well? They gave me like three and I just check the comments, the reviews, like try to figure out what they were doing that was different than the other ones,

9:59compared them to the other ones. I found things like they were just more responsive. Their answers to the questions and to the feature requests were better. You know? So I just like stole a little bit from, you know what little bit of everything that I just liked. So I was doing the research. The AppSumo community does tend to

10:21favor certain things a lot too. Like white labeling is a really big thing for them. And one person told me beforehand too they open it up for a few days to people to a customer's AppSumo customers that pay for like a special tier or something like that. And one of those people's, really useful,

10:43she gave me some links to Facebook groups. That was another thing that I did. I joined some Facebook groups of people that like to buy these deals and there are several of them and they have a lot of people in there and they do talk. And when your deal is going on, you want to go be

11:03in there answering questions and all that stuff. It's helpful because they do drive a lot of buys. - [Rob] That's good to know. - [Ruben] Yeah. - [Rob] Yeah. Yeah, that's not something I would've thought about. - [Ruben] I hired somebody part-time for support because it was going to be a lot of support.

11:20And we were still kind of, it's super early. We're building our features in digging up some of the like, numbers and all that stuff for this. And looking at some of the comments, I really, there was something that I saw in there that I didn't. I was like, what is this right? It was that we were missing like the audit page feature. So we were super basic at that point, when we did the deal and people were like,

11:49they don't even have like, you know, blah, blah, this stuff. And I'm like, that can't be right. What's my answer to that? And I was just like, oh, it's coming, blah, blah. You know, it's like, whoa, we didn't even have that. But I was just kind of looking to see and trying to figure out, like,

12:06what are some of our answers going to be? So when the time came and I have all these different questions to answer I'm not trying to think on the spot. You know, you have to do that a little bit but I'm basically better able to come up with with some answers that people like. The first day I told the person not to answer any of the questions,

12:31at least for the first part of the day. And what I did was just go in there myself and answered a whole bunch of questions because I didn't really know exactly what they were going to ask, but that helped this person see how I was answering those questions. And then I just told her like, hey when you feel comfortable and when you see when, how I'm answering,

12:48go ahead and start answering some of those questions. Then I just took a bunch of those questions, put them in a Google doc, nothing fancy, just copy, paste with my answers and then did like a really quick like FAQ and added to it. And over the next couple of days after that she was just

13:04able to answer most of the questions, almost all of them. I still went in there and, you know, answered questions myself. So that was one thing. The other thing for the support stuff is that a lot of people worry that they'll do a deal and they'll get support and it'll just be never ending. Right and so you could see here on the, yeah you can see here, the definitely there is a big spike but then after the deal, like it just goes down

13:34and there's definitely more support before. After then before that's because we weren't, you know we weren't launched yet before, but it's nothing crazy. It's completely manageable. But it does go back to, I think one of the things that I hadn't, when I've spoken to people before about doing the AppSumo deal, that I hadn't until recently thought too much about was

13:58like the mindset part of it. Not until somebody who's thinking about doing the deal

14:07sort of brought up as a factor for them in basically if you're going to have, if mentally you have a tough time with somebody, let's say two years later still using the product and sending in support then you're going to have a tough time with this. As long as. - It's going to bother you

14:27- Yeah, it's gonna bother you. - It's gonna be a nagging thing of like, you see an AppSumo or you see a support request come in and you know they're an AppSumo customer by whatever means. - Yep. - And you're saying, if that's going to bother you every time you see it maybe it's not worth doing right?

14:38- Yeah. - 'Cause you get life's too short. - Yeah. As long as you frame it right. Whenever I see that coming in, it's like, okay these are people who are incentivized to recommend us, they're using the product, they're exposing other people to the product. So I'm totally okay with it. And I don't have a problem with that. Right and again I think of them as free,

15:01same as free users. - Right and that is something that we didn't call out earlier but you do have that or you called it out but I didn't call it out specifically is you do have that viral component where your electronic signature. So every person that uses it, whether they're free or not or only paid once, they are, if they're using it

15:17they're sending out these document requests. And so other people are being exposed and that can spread the word and that's another thing. - Yeah, it's just a way of thinking about it. I know somebody that has a product that's very similar, that has a viral component and they did a deal a while back and they regret it because they think of it,

15:39because they think of it differently and it bugs them.

15:45Reviews are really important. You start to get reviews on the AppSumo page and other people look at those to sort of decide whether or not they're gonna buy it, just like anything right?

15:58And, we basically had to help make those reviews better. We had an automation on day two for anybody

16:10that had an AppSumo coupon that they redeemed in their account. On the second day, we sent out in an email that basically just said that, you know we're a small team on a Portland, Oregon. We're excited about, you know, them signing up, improving the product for them. And one of the ways they can help make the product better

16:30is by helping us grow. And one of the ways that that happens is, you know they basically just help us with reviews on AppSumo. So we did that and that helped move that score up there. And we did that for, not the entire time but we did that for a little bit and I wanted to use, you know, like, they're most excited, people that are buying this deal

16:56right when they sign up. So I want you to like, use that to also help us on other review sites, not just AppSumo. So like Capterra, G2 Crowd, just change the link and change a little bit of the wording after like a few days and had them sort of like go back and forth between the different sites and contribute reviews there

17:19which has been really helpful for us.

17:25The revenue was $41,145 from this, almost 2,800 buys. So 2,799 people bought. And interestingly enough, there were 292 refunds. So to the 2,800 number is after the refunds. Right. - [Rob] So it was like 3,100 total buys, is that right? - [Ruben] Yep. - [Rob] Oh, wow. Okay. - [Ruben] Yeah. - [Rob] And so that's a $41,000 is always,

17:57for some reason I always think you made like 32 or 35. I don't know why I had that number in my head. - Yeah. I thought so too. I've actually said that, but then I dug up the numbers and it was $41,000. - It's 40 grand. I mean, that's not - Yeah. - Yeah, that's not a bad take for this. And so third, why do you think, I mean that's like,

18:1410% refunds. Do you know if that's normal? Feels high. - I think it's kinda normal. I think it's also a little bit high. I think it's normal to see a higher, that's the way that I'd say, it's normal to see a higher refund rate than what you would normally expect from people who, you know, buy your product because a lot of people just want to,

18:38they'll buy without even really evaluating your product. - Right, they'll buy then they log in. - Yeah and so we had a couple of things that were confusing people. Some people thought that we were like, a contract generation sort of tool. So and that was just some of the wording, just seeing the link on our NAB that just said, contract templates and some people would go there and like,

19:02oh, okay they offer contracts. And some of the wording on one of the first emails that went out to the apps and which, you know, and on the landing page, we changed that to clarify. So I think that was partly causing that also we were just super early. Right. We didn't have some of the basic features, so yeah. I think people can expect some refunds

19:26but maybe not this many. - Yep. Very cool. And so I think in conclusion, yay or nay, like, are you happy? Do you have regrets? Are you glad you have the deal? - Yeah. Nope. I'm really happy that we did the deal. It helped, you know, on several fronts, like a little bit of revenue helped on the marketing side, just exposure, customer development really and we earned we got some bigger deals that we wouldn't have, I know for sure we wouldn't have gotten if we,

19:59outside of this, just bigger teams signing up. So it was super useful. - Very cool. I know AppSumo and again, we're not saying you should do an App Sumo deal but obviously it worked for you. And we tried to point out some pros and cons of some folks out there. Maybe shouldn't do it. I know AppSumo is booked out several months 'cause I know a couple of other people still talk you know, also talking to them about deals but certainly easy enough to reach out to AppSumo if you feel like this,

20:26if you're watching this and feel like it's of interest. Ruben, man, thanks so much for coming on the show and you know, sharing your knowledge, dropping the wisdom and sharing all the numbers and I'm sure there are some folks in the audience here today that'll get a lot of value out of it. - Cool. Happy to share.

20:42Thank you. - Thanks again to Ruben, for joining us today. And if you have any questions for me about Ruben's AppSumo deal or any of the numbers or thinking through it, you can post it. I'm looking at the MicroConf Remote channel over here in Slack. Is it bad that I kind of wanted Producer Xander

21:01to run that video at 1.5x? I really, here's what I want to do. I want to do like a virtual summit and I want to call it the 1.5x Summit, because if we're going to have stuff prerecorded again, I'm poking a little fun at some of the other summits I've been part of but if you cannot pre-record it anyways

21:15why not get a little more information per minute? So if there are no questions, then I will torture you with jokes and force you to ask questions. So, one joke example, why shouldn't you take a broken spear into a fight? It's pointless. Yep. That's about as good as it gets there y'all. Can you imagine if one day Microsoft acquired WeWork

21:40and named it Microsoft Office? I think Mike may have invented that one. Okay. Oh look, this is great. We have a question. Someone says, I give up, so Deep asks, are AppSumo deals good for B2C apps too? And yeah, if you look, the cool part is you can go to appsumo.com and you can sift through all the deals.

22:01They don't just have one deal. It used to be an exclusive kind of deal a day type thing but now they have a whole marketplace of them and you can flip through and you know, their list is, it's aspiring entrepreneurs. And it's like Ruben said, it's people who run, you know, who are realtors. So like VSMB's, like very small businesses,

22:22very small competing businesses. And so there are folks who, you know, to-do list apps or things that would normally be thought of as kind of really broad at B2C that I think can work there. I think if you have a B2C app, that's also in a niche I think that's a tougher sell. But the best thing to do is to reach out to AppSumo like, they have staff there who can evaluate and they've been doing this now for, I think the first AppSumo deal was,

22:47it had to be 10 years ago. Cause I remember it. So Noah Kagan started this and the first AppSumo deal we listed in our online membership site at the time it was called Micropreneur Academy. And I think like 20% or 25% of the purchases came from our listener base or I'm sorry, our membership base

23:05which was really the precursor of MicroConf itself. And so he and I got on the phone early on and that had to have been, you know, probably a decade ago or so. Justin Kissner asks, are there ways to limit the downside risk of a lifetime subscription? I mean, yes, there are. There's, a real, there's a needle you have to thread here because you can't just, like the AppSumo, both AppSumo folks who work there and we're actually going to hear from Chris in a minute, he works at AppSumo and he's going to talk us through some of the nuances of this, but there's both the folks who work at AppSumo

23:40and also the people who are buying the deals are, they're pretty savvy, right? And they know, they've seen people try to kind of get around, to skirt around it and be like, well this is the AppSumo plan and we're not going to add any new features to the AppSumo plan. And that's not going to fly, 'cause you're going to make people mad or we're gonna like severely limit this, you know

23:58this plan toward the app is not, almost not usable. So I don't think you want to go down that road. I think the thing to think about is if you do have any type of viral component or if you can build that in a powered by link, anything like that to have into your lower price plans

24:11and your AppSumo deal, I think that's a big win. I think if your app by its nature does have a cost where with each new person that signs up, that's probably, that's a pretty tough sell for me. You know, I just don't know that there's a way to work around that. As Ruben said and as I've heard from a few other folks who've done these deals is, there is a lot of support upfront for the month and maybe for a week or two after

24:34and then it really does die down. So unless you feel like A, you're going to cannibalize a lot of your revenue or B, there's going to be a lot of either ongoing support or costs. I do think this is something that's, you know, it can work for a lot of apps that are in that position.

24:50It looks like there's one more person typing. And then, so I'm going to talk a little bit about, oh yeah. So after, oh, there'll be some, let's see MicroSpace conversations in pods A and B. Pod A is going to have your most successful marketing campaign and pod B is share your SaaS, use the screen share function

25:12to give a short demo of your product. And so as we wrap up here, there's an optional session with, I'm about to intro him, Chris Schelzi and I believe Gennady Batrakov is supposed to join him as well. He's a founder of Blogely and Chris works for AppSumo. So he's going to have a conversation, behind the scenes conversation about AppSumo

25:32and how it works, showcase the platform. And that'll be here, you know, it'll stream on YouTube even if you don't have the all access. You'll see that in just a minute. Yeah. Cool. And then John Golding from trot dot to, he posted, he said there's also a good startup for the rest of his episode where Ruben

25:47Rob talked to Ruben about the deal, it's episode 456.

25:54And so that's something you can also dig into if you want to hear more. All right. What did users get? Okay. Yeah. So there's some questions producer Xander's passing me. What did users get in the deal? Was it for a fixed period of time? So I believe most AppSumo deals now are lifetime deals

26:15and the users got a lifetime. You know, the cheapest plan pricing tier of Docsketch, I believe is what it was. And then Trevor asks, what percentage of people became active users versus unused accounts? Thinking about services you pay for and how the cost ratio plays out with active, inactive AppSumo users. I don't actually know that number, to be honest. I was tossing this around hypothetically with another founder the other day who's evaluating

26:44whether or not to do one. And I was guessing, I was like, I think on the low end you're probably get 20 to 30% active. And on the very high end it feels to me like it's maybe 60%. Like I can't imagine more than 60, 70% of AppSumo deals actually becoming active. I mean, how many episodes deals do I have that I've activated so that the coupon code

27:07or whatever, you know, the AppSumo code works and I get it. And then I just, I haven't actually used it. So I know I'm one of those folks who's guilty about that. What is small, too early or to pre-product market fit for this approach? What is too small, too early? That's I mean, that's a good question for Chris. Who's about to come on, to be honest but in my opinion, yeah if you don't have some people using, right like if you have zero users, I would not go to an AppSumo deal because you're going to run

27:36into scaling issues really quickly. I would want to be at a minimum in early access. And frankly, they like you to be launched. Like they don't want you to be what's it called? Just under, you know enter your email and get an invite, like invite. They don't want you in invite-only mode to be running with this, so.

27:57All right.

28:00Cool. Cool. Did you allow AppSumo to bid on your branded keywords for ad spend? Also, did you have them know index the deal page we're launching in April. I don't actually know about that. That's an interesting question. And I think that maybe that's one that you can ask Chris if that's a common thing, because I haven't, you know

28:20the AppSumo deal runs for a matter of weeks, right? It's like three or four weeks. So I guess they could bid on the branded term during that time. But to me it's all a negotiation, right? It's saying, hey, I want to include this in the contract or else figure out what's a deal breaker for you

28:34and talk to them about it. (upbeat electronic music)

28:51Captioning made possible by Balsamiq