Growing Morning Brew from 0 to 10,000 Subscribers

What's up, everyone? Welcome back to another episode of Founders Journal. This is your host, Alex Lieberman, co-founder and executive chairman of Morning Brew. Founders Journal is my personal diary made public for the world. And as mentioned last episode, we are switching things up a little bit in the month of April. We are moving the podcast from 3 times a week to 1 time a week so that we can take a breather. And we're doing some planning in the background to launch a new format that we are really excited about, but we want to make sure we're really thoughtful about doing it. So for the next 4 weeks, including this episode, you're You're going to be getting a weekly episode, and each episode is going to be around telling a specific story about an inflection point in Morning Brew's history and specific tactics you can take from our experience and our journey. On today's episode, I'm going to talk about how we got from zero subscribers when we first started Morning Brew to 10,000 subscribers, which I would say is roughly the point at which you can actually start making money off an email newsletter. We will go into all of the tactics. All of the learnings, and hopefully you'll have a lot that you take with you. So let's hop into it. So for some quick context, Morning Brew was founded in 2015 when I was a senior at the University of Michigan. My co-founder Austin was a sophomore at Michigan. It actually started by a different name. It was started as Market Corner. It was a PDF that I put together every single day where I would basically just read the news for 4 or 5 hours. I would curate and write 50 to 150 word blurbs synthesizing the most important stories. I would do a stock tip of the day, an interview question of the day, a quote of the day, etc. There was no website. So if you wanted to read Market Corner, you would have to reach out to me and say, hey, I heard about your email. Newsletter, can you add me to your listserv? And I was literally managing a listserv. And first of all, I share this context to give you some insight into how shitty the original product was, as most starting products are. But it still hit on a key need, which was people just wanted better business content that wasn't dry, that was quick and read like you were having a conversation with a friend. The second reason I share the early context, you know, kind of pre-Morning Brew, is because this is when we actually got our initial subscribers. And I think like most businesses, your initial customers are going to be just the people in your close circles. So I would say the first 50 to 150 subscribers for Morning Brew, but originally Market Corner, was my family, very specifically grandma, mom, grandpa, sister, cousin, aunt, uncle. I probably got to, you know, our first 20 subscribers with just family members. Then I would say the next 50 to 100 subscribers were people that I was helping to prepare for job interviews. So the way that Market Corner was originally founded is I was helping students prepare for job interviews during my senior year. I'd always ask them, how do you keep up with the business world? They would say the same answer, which was like, you know, I read The Wall Street Journal, but my parents tell me to read it. It's dense, it's dry. I can't finish the whole thing. And so once I came out with Market Corner, I went back to those students who told me that they didn't enjoy the Wall Street Journal, and I said, "I created a product that you're going to like more than the Wall Street Journal." So all of those students I was helping prepare for job interviews, they became subscribers. I was in a fraternity, so people who were in my fraternity, I shared Market Corner, my new newsletter, out on our fraternity listserv. So I probably got thirty or forty new subscribers from there. And then I would say for the next few months, I probably gained. Another 100 to 200 subscribers just literally through word of mouth in the most high-friction way. Because again, when the product was originally just like this PDF that was attached to an email sent to a listserv, there was no website, so it was impossible for you to sign up. So I would end up getting random emails from people who said— who would tell me they heard about my newsletter through one of my subscribers and they wanted to sign up and they would give me their email address and then I would I would punch it into the listserv and they would start getting the newsletter. So let's just say by the time that Market Corner, which was around for 2-ish months before we turned it into Morning Brew and I brought on Austin as my co-founder, let's just say Market Corner got to 250 subscribers. So that's 0 to 250. We come out with Morning Brew and basically the way we start thinking about things, my co-founder Austin and I were like, okay, who are the people? It was always like, what are the warmest possible leads? Like, let's focus on the warmest, most accessible leads to us, right? So even in the the early days, the warmest, most accessible leads from 0 to 250 was family members, the people who told me that they were having a problem with business news, and people in my fraternity. But then once you get out another kind of circle, where we started thinking about is like, who do we have access to on Michigan's campus? Because that's where we're going to school, that, that would be the people that we have easiest access to. How can we get in front of a lot of these people on Michigan's campus at once? And who are the right people? And we basically said the right people are business students or students in business classes or business clubs, because clearly they have a vested interest in knowing what's going on in the business world. And so, you know, what we started doing is we were like, okay, we need to figure out a way to go into every business class on Michigan's campus, every business club on Michigan's campus, and we need to convince the teacher or the club president to let us go up in front of a group of people of qualified people pitch Morning Brew for 60 seconds and pitch it in a way where it's a no-brainer for them to sign up and just do that over and over and over. And so that's what we started doing. We would basically— the classic thing we would do is we'd go to a lecture hall right before the class started. When the professor was walking in, we'd introduce ourselves to the professor and I'd say something along the lines of, hey, I'm a BBA in the business school. I'm a senior right now. And, you know, in my free time, I basically created a better source for business news for college students. It's quick, it's conversational, it's nonpolitical, it's free. And I think it'll just generally level up your students with content they'll enjoy and just make them smarter for your class. Most teachers would say yes, they would let us in. And then basically the procedure that we would go through is I would stand in front of the class, and I just developed this story that I thought made Morning Brew sound like a no-brainer. And it was something along the lines of: Morning Brew is making business news less shitty. Once you subscribe every morning at 6 a.m., you will automatically get our newsletter into your inbox. Morning Brew covers the most important news, business news in the world that you need to know about to be an intelligent professional, to not be caught off guard in conversation with your coworker or your boss. The best part is it's free. If you don't like it, you can always unsubscribe and it reads like you're having a conversation with your smart and sociable friend. And I would say that and like it would be— there would be no reason for a student not to sign up because it doesn't cost them anything. They can get rid of it if they don't like it and it can possibly make them better at their job, which leads to them having more social status, making more money, etc. We started doing these pitches where we would tell students to take their laptops out, go to morningbrew.com, put in their email address. And what we realized is that was too many steps for students. So then what we started doing is I would make the pitch I just gave to you. My co-founder Austin would take a sheet of paper and pass it to one of the ends of the class with a pen. And we just say, if you're interested in signing up for Morning Brew, write down your email address and we will sign you up for after class and you will get the email starting tomorrow. And a way higher percentage of students in the class would sign up because the friction was taken away from the signup process. It's like it was the analog version of basically going to a website and instead of the funnel being like 7 steps, it was 1 step. And so then we would collect all these emails in class. We probably would collect on average 90% of a class. And then Austin and I would literally go to a table in the main area of the business school of Michigan, which is called the Winter Garden, and we would just punch in every single email address manually and say there were 100 emails we got. We'd always punch in like 120 email addresses because we were sometimes not sure if an I was an L or like you know, if G was a Y. And so we'd put in multiple versions of people's email addresses. So we started doing that. And basically without knowing it, like the big marketing tactic we used on Michigan's campus and continued to use was this idea of a hub and spoke model. So a hub is something, a digital channel or an in-real-life channel that gives you leveraged access to a lot of spokes. Spokes are your— the ideal customer you want to get in front of. Again, we didn't think about it in this way at the time, but it's how I think about everything now. And the reason is, is because when you get access to hubs, it gives you so much more leverage. It frees up your time to get in front of more customers because instead of going, you know, student to student, by going in front of one class, we got access to 75 students or 100 students or 500 students. And so basically Austin and I went through this process of going to every class and every club that probably got us to our first, I want to say, 2,500 subscribers. So we got, let's say, 2,500 subscribers, which was most of the business school at Michigan at the time. It was some econ students, some other liberal arts students at Michigan who were interested in going into business. But then we had basically cleared out Michigan and we're at 2,500. Of course, we were kind of still growing organically little by little. Now, you know, Michigan students telling other people. But Austin and I basically said to ourselves, we're like, okay, this process works. you know, getting access to classes and clubs or hubs, which are the classes, spokes are the students. This strategy works. How do we do this in other places? Because we're students at Michigan, we're not going to do like a college roadshow. How do we get college students to do the same thing? How do we find the Austin and Alex at other schools? And so that's when we created Morning Brew's Ambassador Program. And I remember the thought we had at the time is like, there historically are a few really good examples of companies that have done ambassador programs well. Like Red Bull comes to mind, Uber comes to mind when they were first getting started. But our, our thought was like, why haven't media companies done any sort of ambassador program? Like we had never heard of a media company that did an ambassador program. And so we put a call out in our newsletter and we also asked friends of ours for connections to other Big Ten schools. So we first focused our ambassador program on other Big Ten schools. So, you know, Wisconsin, Indiana, Penn State, etc. And we basically would get ambassadors, we would train them in how to pitch Morning Brew, we would incentivize them with swag because a lot of these ambassadors were already readers of Morning Brew, had found out through a Michigan connection. So we'd incentivize them with Morning Brew t-shirts, mugs, sweatshirts, stickers, etc. And we train them to do the same exact process: go to classes, pitch the brew, get emails written down on a piece of paper, Fill them in, and I would say like you know we had many iterations of the ambassador program, and kind of my biggest learning is there's a hybrid approach to ambassador programs that works really well. The first time we tried an ambassador program, we went for quality over quantity. So we took a bunch of ambassador applications. We only accepted like ten ambassadors, and they were the people who were like the best students involved in the most business clubs. Like the people we thought were like the super connectors on their campus. And while the hypothesis was right, what was wrong is these people generally were. Were overextended already, so they just could not fulfill on the commitment to actually be a good ambassador. So then we went the opposite approach, and the second time we did an ambassador program, we went for quantity over quality. So we literally let in 250 ambassadors from 200 different schools. And the issue with that is it was an operational nightmare, and a lot of our ambassadors just like weren't worth spending time on because they weren't putting in the work. And so ultimately where we shook out is the best possible ambassador program is this hybrid we did where we let in 200, like we made it a quantity game. So we let in every ambassador, but a lot of it was automated until they proved that they provided good work and actually were getting people to subscribe to Morning Brew. So what would actually happen is we put out a call for ambassadors in Morning Brew. Ambassadors would fill out an ambassador application. We'd say in the application, you know, it's a really rigorous process. We'll get back to you. If we think that you have the chops to be an ambassador. Turns out we set it up where every person who filled out an application got accepted. And then what— when you were accepted, what you would get is you basically get a daily email drip that would take you through the process of becoming an ambassador, giving you marketing materials, teaching you how to pitch the brew. And then we would indicate to all ambassadors who were accepted, which was everyone, that if you get to 25 referrals, so if you get 25 people signed up on your campus, we will then bring you into a VIP Facebook group that Austin and I were actually in where we would be interacting with our best ambassadors on a daily basis. And so this was the hybrid approach of letting everyone in, but you only get access to the founders of the business if you have proven that you actually care about doing a great job as an ambassador. So anyway, that was the ambassador program. I want to say that probably got us to around 10,000 subscribers, especially as we went beyond the Big Ten and were at many schools. But I want to just share the kind of third growth tactic that is the next natural iteration of this, right? Like the first one was Austin and Alex getting access to hubs on Michigan's campus. Then it was how do we get other Austins and Alexes at other schools to get access to their hubs, which is their business classes and business clubs? The third iteration, which to this day is still such a big growth lever for us, is Morning Brew's referral program. And basically the thought process went like this: we had been doing really well with our ambassador program, but we wanted to grow faster. And we were like, at the end of the day, while Morning Brew was originally just focused on college business students, there are so many more people in the world that want just quick. Conversational business news that's free every day in their inbox, right? Like a 21-year-old who's a senior in college could want that because they want to be smart when they go into banking, or a 35-year-old who is a VP in banking and doesn't have time to read a lot of news in the morning could also want that. And so we came out with a referral program, which again, we had never seen media companies doing before. And that's the funny thing. I actually think in a lot of ways One of the ways that we grew well, other than like this hub and spoke model and just also learning how to tell a good story that was like a no-brainer for people and also being shameless about going in front of a group of people and not stopping ourselves from doing things out of fear of rejection, is we took concepts that are proven in other industries and just hadn't been applied to media. So referral programs had been big in other industries like Robinhood. One of the ways that Robinhood blew up in the early days of the app is they created a waitlist. And if you referred people to Robinhood, you would move up in the waitlist. And so what happened with the referral program is one day we were on Tim Ferriss's blog and there was a blog post he wrote about how Harry's Razors had gotten its first, I think, 100,000 customers through having a landing page. And basically similar to Robinhood, when you put your email address into Harry's Razors, every customer you referred, you got some new reward. So say one customer you referred, you got a month free of Harry's. Next customer you referred, you got like a bag to hold your razor in, and it would go on and on. And Austin and I saw that and we're like, wow, if we can develop a great referral program, all of a sudden we can make everyone who's a reader of Morning Brew an ambassador, not just college students. And so it was simple. We ended up going on Upwork, We had an engineer named Connor in Ohio who we basically said, rebuild the Harry's Razor landing page, but let's just update it with our rewards and our background versus Harry's Razors. And we integrated it with our website. And so then moving forward, what would happen is you would sign up for Morning Brew, you would get a unique referral link. With that unique referral link, when you shared it with people and if they signed up for Morning Brew, that would increase your referral count. And as you hit certain referral milestones, you would get rewards. So at 1 referral, you would get a sticker. At 3 referrals, you get light roast, which was our Sunday morning brew that only if you had 3 referrals would you get access to. At, you know, 10 referrals, you would get access to our VIP Facebook group. At 25 referrals, you get a Morning Brew t-shirt. At 30, it was a mug. At 50, it was a sweatshirt. At one point at 1,000, you get flown to our office in New York City. And we generally picked rewards that were not expensive, but that Morning Brew Super Readers would care a lot about, either because it gave them exclusive access to something that they deemed highly valuable, like a community of other Super Readers or exclusive content, or giving them like swag that they could show off in public, like a mug, a sweatshirt, a sticker, etc. And so that was the referral program. And it went absolutely gangbusters. And again, referral programs only work when the quality of your product is great. A referral program literally just decreases the friction for someone who loves your product to go the extra step and sharing it. But today, Morning Brew has, let's call it, 4.5 million subscribers and over 400,000 people have gotten at least one referral using the referral link. So to tie this all together, to get Morning Brew from 0 to, let's call it, 10,000+ subscribers, there were basically 4 main steps. The first 50 to 100 were family members, the people that I was helping prepare for job interviews, and friends in my fraternity. The next few thousand were Austin and I getting access to hubs on Morning Brew's campus, telling a great story that was a no-brainer for students. And being shameless in being willing to be rejected by professors or by our classmates. And then the next, call it 10,000+ after that was finding the Austin and Alex on other college campuses and establishing our ambassador program, which again was optimized when we did a hybrid approach of letting everyone in but automating it until people showed that they actually could perform. And then the final piece was making everyone who was a Morning Brew reader an ambassador, even if they weren't a college student, by creating our referral program, which literally exists To this day. So that is the growth of Morning Brew in the early days. And I think whether you are working on a newsletter and you're thinking about how do you grow your newsletter organically, or you have any sort of product, I think there are abstractable lessons that can be applied to things far beyond media. So I hope that is helpful. As promised, next week you will get another Alex storytime around a big impactful moment in Morning Brew's history and the lessons that you can learn from it. As always, thank you so much for listening to Founders Journal, and I'll catch you next episode.