Nathan Barry on Building ConvertKit and the Creator Economy

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You should teach a skill that makes money to people who have money.

You're listening to the Elevate Podcast, and I'm your host, Robert Glaser. Join me as I talk to world-class performers about how they build their capacity and reach greater heights in leadership, business, and life, and how you can do the same. Welcome to the Elevate Podcast. Our quote for today is from Madan Gowri. When you enter a smaller screen, a phone or a computer, you are not a celebrity. The moment you enter this space, you are a creator. My guest today, Nathan Barry, is the pioneer of what's being called the creator economy. Nathan is the founder and CEO of ConvertKit, an email marketing platform used by creators like James Clear, Tim Ferriss, and Arnold Schwarzenegger. He's also the author of Authority, an ebook that has sold over 15,000 copies worldwide since its release. Nathan, thanks for joining us today on the Elevate Podcast.

Yeah, thanks for having me on.

So before we get into your background, I thought I'd kick it off with a big picture question just to get everyone on the same page. What is the creator economy and how is it changing how we live and work today?

Yeah, so the creator economy, like that term for it is relatively new, but what everyone's been doing for a long time now, it's being overapplied to everything that used to already, already existed, like any new term. Yes, exactly. But it's, it's this idea that you can earn a living in a, in a unique way serving an audience. And so You know, before it was like, hey, I have this job and maybe like I have these skills. I'm a designer, I'm a writer, any of those things, and I might use them working for a company or, you know, freelancing or whatever else. But the creator economy is like, wait, I can use this at scale with an audience, right? So I can earn a living just by writing a newsletter and having sponsorships and advertising in it. I can, you know, write an ebook and sell, you know, 10,000 copies or something. And it's like, wait, that actually makes me more money than like when I was working as a designer at another, you know, at a software startup or whatever. And so it's this idea of taking your skills as a creator, an artist, a writer, you know, it's kind of an all-encompassing term and using that to like educate, entertain, you know, other people and they follow you for it. And those people are often happy to buy things either with their attention or with their money. And that turns into you know, you being able to pay your mortgage and beyond. The craziest thing that I realized maybe like 5 years ago or something, I was like, wait, all of my most, all of my highest earning friends are creators. You know, they're not like doctors or lawyers or like even the family circles that I knew, right? You're like, wait, I know these people making $250,000 a year, $500,000 a year, and they're not like anesthesiologists or, you know, they're writers. They have this career that like, people are probably like, hey, what are you gonna do with that English major or that like communications degree?

I, I mean, I always say to my kids, like, if you're the absolute best at whatever you do today, like even the grasshopper guru, like there is an audience or—

Oh yeah.

But what was the change in this? So obviously people are able to get direct to their audiences. So was it, was it the ability to publish your own book, social media? Like before you either had to get, you know, you had to go beg for a book deal or you had to kind of, be part of a media empire. So is it technology that has just enabled people to build an audience directly? Is that the fundamental change? Well, why you can make a living doing this now and not 10 years ago?

Yeah, I think there's a few changes that layer on top of each other to get where we are now. The first is that the population consuming content on the internet is just much larger, right? If you were writing a popular blog in your niche in 2010, right? Maybe a popular travel blog. You might have 10,000 subscribers to your email list or 10,000 readers. Today, that's more like 500,000. So the first thing is there's just way more people out there. I think the second thing is that the opportunities to get discovered are much better today than they were before. So back in the day, you might be like guest posting on other, other blogs. Or you'd be using SEO a lot. You'd be getting search rankings and showing up there. Today, like you could basically, I recommend a hub and spoke approach. So you like have your core newsletter, your core business, that's the hub. And then you have a few of these spokes of like, hey, I'm going to really grow on Twitter or YouTube or TikTok.

Most people have done one really well, not 5 of them average, right? I think that's true for individuals and for businesses too.

Yeah. So even you look at like, You and I have talked in the past about like LinkedIn. You know, LinkedIn did not have a discovery engine before and they built a really good one.

Yeah.

And you've used that to build a pretty sizable audience, right? I've done the same thing on Twitter. And so you can kind of— those discovery engines have gotten significantly better. And so that just allows you to reach a lot more people. So the same effort, you like, you might put in a ton of effort before and be like, hey, I built an email list of 10,000 people. And then now you can put in still, it's still a lot of work to be clear, but you put in the same amount of effort and build it to $50,000 or $100,000.

Right. I guess also again, there's, there's a place when people hear, let's just pretend you were written up in a magazine article 10 years ago, right? 15 years. Like I'd hear about X person and then there's a way right away to jump on, grab, follow that person. Right. You know, take advantage of that time that you blow up and then and then turn that into people that are following you rather than they had to remember, you know, they heard something about you or that you were the expert at this. Like that, that seems also to be different, right? That they can, they can jump on your newsletter or follow you again. 10 years ago, if I went on the Today Show and I was all over the place, like where do people, where do people find me or how do I get them in my audience? Right.

Yeah. So I think that's that last component, which is having the tools and systems to be able to take someone from like being aware of you to like you being able to reach out and push content to them. And there's a bunch of ways that you could do this. You know, the social networks have a little bit of this. Like if I post something, there's a decent chance that you'll see it, you know, if I post it on Twitter. Yeah, but like it's not guaranteed by any means. Like that's why I love email and I dove into that world is that like now I can push content to you. And so like the email tools like ConvertKit, what I'm building, I've gotten way better, but then also just all your options for monetization.

Yeah.

You know, things were before— I mean, you've been in this online game for a long time and like 10, 12 years ago we're using tools like ClickBank and, you know, I don't know what else. Right. But I think what were the ones— there was one that everybody used that was just terrible lead gen stuff.

Yeah.

Yeah. And then today there's like, there's so many great options for that. And so you combine all of those things together and it takes it from being like you had to be really good at internet marketing and all of that to know how to make a living online to now it's like, look, a lot of the best practices are built into the best tools by default.

Yeah. In fact, the people that are really good at internet marketing, like they're the ones that just feel a little gross, like sometimes where they have some average knowledge and really good marketing and you go to their websites and it just feels like a massive for sale thing rather than This person's an expert and I want to start engaging with their content and their, their world.

Yeah, absolutely.

So you built this incredible company. We'll get more into this, but let's, let's go backwards to how you, how you got there. So when you were younger, like, were you always entrepreneurial? Were you selling textbooks in school, getting thrown out of class? Like, I have a sense you, you probably were, but I, we haven't had that conversation.

Yeah. So I, A couple things about me. I grew up in a family that money was very scarce.

Yeah.

And so I watched a lot of conflict around money. And then when I was 19, my parents divorced like that. I just watched it like a defining factor from like age 10 on, basically when I was old enough to notice it. The second thing is I was homeschooled and so like I didn't have the like selling textbooks or like now I think you'll get these classes. I was talking to someone.

There's not a lot of people to do business with when you're, when you're homeschooled.

Yeah, exactly. But someone was saying like, yeah, my kid goes to Costco and then like loads up on all these snacks and foods and all of that because like at their school they're not allowed to leave, like go offsite during lunch. And so they just run this like black market, you know, snack business that's like bringing in hundreds of dollars a day. So I didn't have that opportunity, but I would do things. I grew up in a very creative family. Like my dad built the house that we grew up in. We had a shop and so I would make like wood projects and sell those door to door, probably starting when I was like 12 or 13 and then at like get a booth at craft fairs and stuff like that. And then when I was 15, I got into web design and, you know, I got a copy of Photoshop, pirated, of course. And then they just charged too much money for it back in the day.

It's just like $800 when you're 15. $800. I was just going to say it was like $1,100 or something and you're like a starving student. You're like, where's my in-between price, right? Yeah.

Yeah. Oh man. Yeah. So I, I was in a hurry to grow up and I was in a hurry to figure out how to make money. And so another thing, I had two quick stories on this one. I remember probably being 11 or 12 and, you know, we're living like in the mountains, like an hour outside of town and just watching like this most beautiful snow come down. And you're like sitting there, you're supposed to do school and just like want to be anywhere but like, you're like, what's our vacation day policy here, Mom? Yeah, yeah, yeah. Homeschool snow day. Turns out the bus is not a factor and like we're still all of that. And so I'm just watching it and, and my mom goes, you know, school doesn't have to be like a certain number of hours. It's like this amount of work that's in front of you. And so you can decide whether this takes like the next 5 hours or the next 2 hours. And it was like, oh, right. Okay. And so I like, you know, was the most like applied focused kid you've ever seen. And 2 hours later I was out sledding and, you know, the beautiful snow. And then another example is a couple years later, I realized that because all my friends were older than me, that hadn't really mattered. This is like friends from church youth group or all of that. I was just always hanging out with older kids because my siblings were older. And I realized this is fine until they're all about to go off to college. And it's like this 2 to 3 year age gap that I didn't really notice was about to become like very, very obvious. And so then I went to my mom and was like, hey, is, is high school 4 years or is it a set amount of work? And with the same philosophy that she'd always had, she's like, look, I already homeschooled your 3 older siblings.

If you do the curriculum faster, right? Yeah.

Yeah. That is entirely up to you. And so I remember thinking we do these road trips from Boise, Idaho to Seattle, Washington. It's like 8.5 hours to go visit family every summer. And I remember thinking like, I'm really bored on these drives and I'm also really bored when I'm doing algebra. So like, why not? Like, why not just combine those two?

Yeah.

And I had like my older brother sitting next to me who, you know, and so it's like I would do a month's worth of, you know, algebra lessons and just when I got stuck, I would, I would ask him. So I ended up graduating high school and going to college when I was 15. And I just went to Boise State.

Was that a culture shock given homeschool 15? That seems like a massive jump into a different world.

It was to an extent. I had another friend. She'd started going to Boise State when she was 16, and she had said she'd given me a few pieces of advice. But one thing she was like, don't ever tell people how old you are. Yeah, because they'll just treat you entirely differently. And I was like, well, how do you— like, people are going to ask. And so she said what to do, which I did many times and it worked, is if someone says, how old are you? And you go, oh, I guess. And they're looking at you like, you look 15, but there's no way that you could be in this freshman college class at 15. So you're probably 17. And you'd be like, oh, good guess. I'm like, it legitimately was a good guess. It's wrong.

I always say there's a best version of the truth. That's a good guess.

And so I just roll with that and they'd be like, oh, he's 17.

Child prodigy, 17. Yeah.

Because one time I said some, like in one class I said I was 15, you know, and then everybody just treated me totally differently from, yeah, from then on. So, so yeah, there's the best version of the truth. I like that. I could roll with that. So yeah, I was always in a hurry to, to grow up, make money. I ended up dropping out of college at 17 when I got my first web design project that paid over $10,000. And it was like, I'm here to learn how to make money and I think I'm already doing that.

So, but, but I thought I read that you're one of your— maybe it wasn't your first professional experience then, because you had your side gig, but was like, when were you an intern in the Idaho legislature?

Yeah, that was when I was 15. So you had to be a senior in high school to do it.

You lobbied that you were a senior?

Well, I mean, on one hand I was a senior because, you know, I was actually already taking classes at Boise State and the, like the end of the first week that I was working there, I got called into the controller's office.

Yeah.

And I was like, what's up? And they're like, we missed the fact that you were 15.

Like, because they just, you know, there's like, you're like, I said good guess, right? Yeah.

And like, my birthday was on the form, but you know, everybody's a high school, like everyone was 17 and 18. And so they had missed that. And they were like, look, uh, you could tell they were like there was some like employment laws that they were up against trying to figure out. And in the legislative session, it would often go late and they were like, okay, here's the deal. We can— you have a time card. We can never have you write down more than 8 hours on a day. Yeah.

Yeah. Or it'll be child labor.

Yeah. If you work more than that, I need you to write those hours down on a different day.

Interesting.

They're like, never more than 8 hours in a day, never more than 40 hours in a week. If you're approaching writing down more than 40 hours in a week, I need you to go home early on Friday. And then it was all fine, but there was this moment where they were not thrilled.

That's pretty funny. So your, your, your strategy for college worked differently than there.

Yeah, it did.

So it sounded like maybe you had one or two jobs before you, you decided to quit and go on your own, which is not, not a surprise. So What was the decision point? And then you've been kind of vocal about this solo entrepreneur. I think that's how you started. Like, how did you find your footing as a solo entrepreneur?

Yeah, so I did a few different rounds of it, right? In order to pay for, for college. That was the other thing. I was too, too poor to have money to go to college.

Yeah.

And too young to qualify for any of the funding that would normally be available. And so I got a job at Wendy's to pay. It was Boise State at the time was $250 a credit. And I started out just by taking one math class. And so I needed to make $750 in order to pay for that. I paid for one full semester and then after I turned 16, I qualified for financial aid and then college was free for me from then on because I had the needs-based financial aid. So the jobs that I had were Wendy's, the internship, And what else? I worked briefly at the Boise State bookstore, you know, like checking in backpacks as one does. You know, the other things that I did, you know, it just started very slowly of like freelancing, logo design, websites, that kind of thing ramped up from there. And I built a whole business doing that. I got to the point I was making about maybe like $6,000 to $8,000 a month. Freelancing. And then in 2000, the end of 2008, I had like the best month ever. Like the projects had all come together. And so it did really well with that. I think I'd invoiced for like $14,000. You know, there's always the timing of payments, but it felt like—

But your age and back in 2008, that was a lot of money.

Yeah, yeah, yeah, it was. And I was 18 then. And then went on a trip with some friends and my girlfriend at the time, now wife. And we went to South Africa for 5 weeks and we have friends who are a pilot with this organization called Mission Aviation Fellowship. And it's like, hey, I'm going back to South Africa to recertify. He's a flight instructor to go recertify our pilots. Like, do you want to come? So we spent 5 weeks traveling around South Africa and Lesotho and I came back and was like, I just had a killer run. I've got all these deals that I'm going to talk to. Like, this is going to be amazing. And I went back and talked to like the 8 deals that I thought I would close, and every single one of them said, we're not spending money anymore.

Yeah, this was right in the depth of January 2009. And sounds like today.

Yeah, exactly.

We're suddenly not spending money anymore. Yeah.

Yeah. And so in that moment, I then had one client who had done a small project for who was like, were looking for someone full-time to join our design team. They were like a 15-person software startup.

Yeah.

And so then I joined their, their software design team and was there for almost 3 years. And so that was a good, like, team building experience. And I got to work on iOS, like, right when the iPad came out and a lot of fun projects like that.

That was right in your sweet spot.

Yeah. So I bounced back and forth a bit between, like, freelance and then, you know, full-time employment.

All right. So 2008, global Great Recession. What was it called? The Great Recession. I can't remember what it was called.

Yeah, the Great Recession.

Great Recession. You take this job to survive. You're there for 3 years. Then what led you to starting ConvertKit?

Yeah. So I had wanted to be out on my own. I wanted to work remotely and like around that time I'd applied to work at kind of the best remote companies at the time, like The 3 were GitHub.

I was just going to say there weren't a lot and they were all like, yeah, techie developer.

Yeah. GitHub, Automattic who makes wordpress.com and 37signals who makes Basecamp. So those were the 3. Didn't get a job at any of those, but I was like ready to travel and do other things. Had read 4-Hour Workweek, you know, and so started to like think about things in different ways. But I got into building iOS apps right when the iPad came out. We had to do that for a work project and And that was fantastic. And then a few of us at that company, like, kept going on the side to keep learning. And so I made a few apps that started making a couple thousand dollars a month in the App Store, and I just saved all of that money. And so then in late 2011, I— the startup we were at, like, they'd raised a whole bunch of money. They'd raised $36 million, which for Boise at that time was an absurd amount of money.

Yeah, that must have been a record.

Yeah, I think so. And it was over, you know, 4 years or whatever, but still like they, at one point they were burning $1 million a month and, you know, it was, it was a mess. So it like went up and then down the other side and watched a bunch of layoffs and it's like, I still have a job, but it's, it's time to go. And so on that, I, I went out on my own, did freelance iOS design for a while. Kind of started some newsletters like a blog and was playing in that world. And then in 2012, I wrote a book called The App Design Handbook.

And was that self-published?

That was self-published ebook. My goal— I had two goals for that book. One was if you want to hire people, you want to hire a designer, you might want to hire the guy who wrote the book on it. Yeah. You know, and so that would be good lead gen. At the time, there's only one other book on iOS design. And I took a fairly different, different approach. And so the goal was to get a bunch of clients from that. And then the second goal, like I wanted to make money from it, but I thought if I could make $10,000 over like the lifetime of the book from direct sales, that would be, that'd be great. I launched it to an email list of 800 people that I built on Mailchimp and it made $12,000 in sales in the first day.

Wow.

And it was $19,000 by like the first week. And then it was just like off from there. I think that that book ended up selling like $400,000 or $500,000 worth over like the next 3 years.

Right. And then because you self-published it, were able to keep the majority of that for yourself.

Yeah. All but 3.5% for credit card processing.

Right. Ebook. It was all— it was so not physical at all.

Yeah, not physical at all. Pure ebook.

I guess if you're an app designer, you're— electronic is the way to go. So yeah.

Yeah. I like— I made it format really well on the iPad and stuff like that. So that was a good reading experience and But then I got hooked on email because it was like, wait, the sales from this are coming from like, there's more emails driving more sales than every other channel, like Facebook, Twitter, all that, all of them combined.

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It is. Yeah.

And the common, common is solving our own problem. I, I've noticed that you created a company for monetizing creativity when your childhood was about not enough money and being creative. It's very interesting, the, the pattern analysis with a lot of startups.

Yeah.

There's, uh, particularly actually with the successful ones, I, I think because it's very purposeful, right? Yeah.

Yeah. So basically on from there, I ended up writing another book, self-publishing that, launched it to a bigger email list. It sold $26,000 in the first day, you know, and it was on from there and I was just building all of it, like figuring out how to like learning best practices and then hacking Mailchimp to make them work. And so then in January 2013, I was like, okay, I'm going to launch my own. SaaS company and I settled on email as the thing and I'm like basically going to solve this problem for myself and build an email tool for like content creators like me.

What were you not getting from the email provider that you needed?

Yeah, there were 3 things that I was like really hung up on. The first is that I wanted it to be subscriber-centric instead of list-centric. So you end up with like a list of people, you're like your whole list and then a separate list of who had bought your product and like Got it. Merging that was really a pain. And there were tools like Infusionsoft at the time was what everybody used.

But that was too heavy for a—

It was, it was way too heavy. And I was like, I'm a designer talking about user experience and all this and like, that's the tool that I'm going to use. No, no, no. So that was the first one. The second one is I wanted it to be really easy. The industry term that ended up being used for a while is a lead magnet of like, if you subscribe to my email list, I will give you the sample chapter of the book or you know, this free guide or whatever else. And that was totally a pain to set up. Not too long later, Leadpages came along and they made that like that piece of it really easy, but it was never easy in an email tool. And then the third thing is Mailchimp had these— they called them campaigns or sequences. I think, you know, you sign up, you get a series of automated emails, and I just hated the interface for that. Like you're going in to edit one email and then come back out. And I was like, why isn't it just a clean interface where down the side it has all your emails and the time timing and I can click right between them. There's no page refresh and I can just see, oh yeah, I wrapped up, you know, email 3 like this. And so I'm going to start email 4 like that and I can reference it quickly. And so those were the 3 things that I started with.

And also, didn't you sort of realize from the user standpoint that something that just looked more like an email from the person rather than a newsletter?

That was another one.

Yeah.

I spent so much time. Trying to strip down like a Mailchimp template to look like I had opened up Gmail and sent an email to a friend. And it was like, why is this taking me like an hour to like get rid of code and try to remove the columns and layouts and all of that?

Right. So you solve your own problem, you launch this. The word creator is not really out there then. So who and how do you market this to other people?

Poorly.

But because there was a lot of email, there was—

it's a very—

honestly, when you and I first met 6, 7 years ago, like, I didn't get— I'm like, what's different? There's 100 email things, you know. Everyone knows, uh, uh, what's the Constant Contact? Yeah, yeah. And, and the one you were using and MailChimp and all these.

Yeah, yeah. We could probably sit here and list off, I mean, today a dozen or more email companies that are doing like $100 million a year plus in revenue. It's famously like not a winner-take-all market. Like you come into like other things, especially in software, you get a lot of like winner-take-all or winner-take-almost-all. And Mailchimp's the biggest by far at a billion ARR, but there's a lot of players in the $25 to $200 million a year in revenue range, like, like at least 20 or more.

Yeah, there's a lot. Yeah. Or they're part— they're owned by larger companies now who've incorporated into their, into their offering.

Yeah, there's a lot of rollups and that kind of thing that have happened. But so let's see the product. Oh, you're talking about like marketing and positioning. I struggled with that. Like the first 2 years were pretty, pretty rough. It took 2 years to get to $2,000 a month in revenue. Well, actually, specifically, it took 6 months to get to $2,000 a month in revenue, and then it took another 18 months to get beyond that. And really, I tried out different positioning things. It was really hard to, like, narrow in on a niche, even though that's what you should do because you feel like you're excluding people. And I eventually tried that. I was like, okay, we'll focus specifically on authors, right?

That was what served you, right, as an author?

Yeah, but that attracted a lot of like, hey, my dream one day is to publish a Kindle book and sell it for $2. And so this email thing is pretty expensive.

It's not, you know, so what you're saying is marketing to starving artists is not, not a great source of revenue.

Yeah, if you want to make money yourself with your product, yeah, don't do that.

You need people that already have some level of, of success and, and who get it, right?

When I wrote about publishing ebooks and all of that, because the third book that I wrote is called Authority, which is all about, you know, becoming an authority in the space and everything, One line in there is you should teach a skill that makes money to people who have money.

Yeah.

And like, if you get that intersection, it's important.

My parallel in our industry as we were scaling our business was never sell marketing services to the CEO. Like you want someone because they're, they're like, oh, I could do this or my kid's college education, right? We want to sell to a marketer who has a budget to spend on marketing. Working with the CEO was always A nightmare.

Yeah, I believe that. So the positioning that really made a difference is we focused on email marketing for professional bloggers, and that ended up resonating well. They had bigger email lists. They were authors. They were usually self-publishing or traditionally publishing a book, but they had courses like they're making money, and that ended up going pretty well. And so we focused on very specific niches like paleo recipe blogs, men's fashion blogs, you know, and we'd get like, take this very niche-focused approach and then did a lot of direct sales and what we called concierge migrations, which is basically we'll do the whole switch for you for free, which at the beginning was just me like watching Netflix on one monitor, you know, and then like copying and pasting email automations, you know, on the other. Yeah, but it worked and we, we got got a good amount of traction. And so in the third year of business, which is 2015, we went from $2,000 a month in revenue to $100,000 a month. And that was like when word of mouth really started to kick in off from there.

So I think one of your big breakthroughs was you maybe stalked— was the right word— Tim Ferriss down and convinced him, you know, he had a massive following, obviously, you know, author, blog, probably not as much podcast at the time. Convinced him to, or someone on his team to switch to your platform. What went down there?

Yeah, so a couple of people had come first, so we'd gotten Pat Flynn and another big blog called Wellness Mama about when we were at like $15K in revenue. And then when they started, maybe we were at $25K by the time they started saying, hey, we're, we're using this tool and that really helped. Probably when we got Tim Ferriss, we were bigger, maybe more like $300,000 or $400,000 a month. In revenue. And another friend of mine had introduced us because, uh, they knew each other a bit, and Tim was thinking about doing something with his email list. On 4hourworkweek.com, he had always had an email opt-in form that went to a tool called GetResponse, and he just didn't do anything with it. And I think he— maybe when a book came out, he'd done something, um, but very, very little. And I think maybe when 4-Hour Body came out, I'm trying to think of the timing. He was like, hey, maybe I should start to do something with this. He was launching the podcast, but he had no real reason to move. So I like walked him through some email strategy stuff. We talked about how to like how to warm up a cold list because there's just a lot of like pretty easy to avoid mistakes in that. But like, he wasn't going to be the guy to get them to switch. And so my friend Ryan Delk, who had originally introduced us, taught me about what he calls the right-hand man principle. Like, Tim doesn't have time. He's hard to get a hold of, you know? Sure, he'll respond to your text messages.

Who's the person he trusts?

Who's the person he trusts who actually runs all of this?

Yeah.

And so I found out that that was a guy named Adam who lived in Denver. And so that was one of those things. I got an intro to Adam and was like, oh, hey, I'm going to happen to be in Denver in 2 weeks. Like, you want to get coffee? We met up there and that was, that was great. Talk through that. And so then I could have enough of conversations with Adam where we could actually talk about the real benefits of email and diving into this, like, because it takes time to talk through like a big transition.

Yeah.

And so I think that probably took about 3 or 4 months of talking through the details of how to warm up the list and all these other things.

As you're demonstrating this to him through emails and follow-up.

Yes, exactly. But the biggest thing, like going and meeting someone in person.

Yeah, I think people forget that and all that. We all like the virtual and the flexibility, but I think some of the big deals are going to be done in person. I think that's something— look, I'm a huge fan of the hybrid and remote work, but that's something we all need to not lose sight of.

Well, and I think remote work gives you the flexibility to be like, look, I'm not commuting to an office all day, every day. And so I'm going to deliberately fly to this other city with some of my time that I've saved, and I'm going to line up a bunch of meetings. I've learned a ton from Ryan Delk, but there's another creator named Ramit Sethi who was one of the people who, you know, like built early, built up a big blog and email list and all of that in the personal finance space. And we'd exchanged emails because of some of the stuff I'd done with ebooks and pricing. And Ramit had said, You know, like, hey, if you're ever in New York, like, let's, let's grab— all right, specifically says, let's go get tea. And I remember I told Ryan about that and I was like, oh man, I don't have a reason to be in New York.

Yeah, I've done this. I'm going to be in New York. Yeah.

Yeah. And because I was like, I don't have a reason to be in New York, but, you know, the next time I'm there, you know, like Ramit said, we can go get tea. And Ryan is just like looking at me. He's like, that is the reason to be in New York. Like you say, oh sweet, I'm going to be there. Like I'm planning a trip to go meet with these customers or whatever else. Like I'm going to be there either this week or that week.

I did that a lot. It only burned me once where I flew to Seattle and the person canceled with me that I was going to already be in town. So yes, familiar with that.

There can be downsides. But then you line up a whole trip around it, right? You, you get that anchor meeting and then you're like, sweet.

Yeah.

Now, now you actually are going to be in Seattle. On those dates. And so you line up 5 or 6 other meetings or a customer meetup or whatever else. And so that worked really well to get like a bunch of early customers. I had this like New York, Nashville, San Diego, you know, like where, where are the, like the bloggers and writers try to meet in person. And so yeah, that's, that was kind of the early scaling of the company.

So there's some things about ConvertKit and I know probably again for you tying into upbringing and the culture, but there's some things that are really different. And we, you know, you've built this thriving company, you haven't raised any money. But one of the things about the culture, just major transparency, all your major financial metrics, revenue, churn targets are actually, they're publicly available.

Yeah.

Right. Like what the hell made you decide to do that?

Yeah, exactly.

I mean, it's one thing to make 'em public to your employees, but which is public, public.

I mean, I, dashboard that I look at every day. Someone else could also look at every day at ConvertKit.com/metrics.

So what's your revenue run rate right now?

Yeah, we're $32.3 million a year in revenue.

Totally bootstrap.

Yep. No, no outside capital into the business. So what made me do that? I was always curious about money. And I didn't have a lot of people who were good with money around me who were a good role model for it. And so I remember when I was taking this job at the software company, I realized like, I'm going to have to negotiate for a salary and I don't have any clue how to do it. And so my now father-in-law was like, I kind of mentioned that and he was like, oh, and he like goes to a shelf and gets this little book on salary negotiation. He's like, here, you need this. And I just had all these things like, what is a good salary when you're 19 years old trying to— like, I would have said yes to $30,000, $40,000 a year.

Yeah.

And actually, a funny moment, the Salary Book talked about how when someone makes an offer on a salary, like, just don't say anything and just think about it.

Yeah.

And what happened is I went out to lunch with the COO of the startup, and like, I was totally out of my element, you know, but I remember I had ordered this bagel sandwich, which is just an awkward thing to eat. Like, it's, you know, all that. But he had started talking about salary and I had taken too big of a bite. And so he said, hey, you know, we're thinking about this offer and we'd like to offer you $50,000 a year. And I had taken too big of a bite and I was raised well. And so I was not going to talk with my mouth full. So I'm like trying to chew through this bite. And he goes, $60,000 a year. And I would've loved to accept the $50,000 number. And so that was my like accidental improved salary negotiation.

That's a good lesson.

Yeah. Just take your time. Like let them, because I think he thought that I was like offended at the $50,000 a year offer or something like open-ended question.

I remember you in college, Herb Cohen, you can negotiate anything, you know, he's like open-ended responses. Like, What do you think of that? Or what were you thinking? Right?

Yeah. All of those things are good. So these examples of people actually sharing real numbers had a big impact on me. So for example, I was thinking that I wanted to write a book, you know, like the first book. And I'd seen examples of people self-publishing, like the Basecamp guys. And they're like, hey, we self-published our book Getting Real. It made $100,000. Oh wait, $200,000. Okay, now it's made $400,000. And you're like, well, of course, you're internet famous in these circles, you can make hundreds of thousands of dollars self-publishing. That's not relatable to me. And there were these two designers who didn't know each other. Their names were Sasha Grief and Jared Drysdale. And pure by chance, they published like self-published ebooks on design on the same day. It was March 2012, and they showed up on like the news aggregator Hacker News, and they were on Twitter, and it was just Interesting. And they had very different pricing models. And so Jason Cohen, who's the founder of WP Engine, invited both of them to come on his blog and write guest posts about why their pricing model was better. And they shared all their real numbers. And these were people like me. And so, you know, they were not internet famous. They had a little bit of a following. They were designers. And one of them had made $6,000 in 48 hours and the other made $8,000 in 48 hours. And that was like real money. And so that really encouraged me to be like, oh, I could do this. And so I wrote like my own ebook, published it, and then I actually went back and wrote another article. Jason was like, hey, now Nathan, come write an article as well. And so there's this like 3-article series on pricing and packaging of ebooks that you know, is really, really interesting. But I've just always appreciated when someone will share real numbers because it gives so much context. And so my version of paying that forward is that I've always shared real numbers because my idea is that if someone else is building a software company, they might be like, oh man, we're really struggling with churn. I wonder what ConvertKit's churn was when they were at $25,000 MRR and they could go on our dashboard. They're not like combing through blog posts to try to find, did I write an article or mention it? Briefly in a, in an interview, they can actually just go find $25,000 MRR and be like, oh, that was summer 2015. And then just change the date range to that and look at the exact metrics in that moment.

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Yeah, it's the world that I want to live in, and so I'm trying to create that.

So this leads me to the thing I really was interested to dive into you on. And I know when I saw you post this whole thing on Twitter about it. So one of the things I'm sure there's some business owners listening like, you make all this public, like $30 million ARR, you control it, making this much money. Like, isn't that going to piss everyone off? You know, aren't you greedy otherwise? And you have a really unique equity program that you've done, and I think it sort of breaks the paradigm. I think other people might want to do this. They don't know how. I think if you think about equity, there's kind of historically 3 things. There's the venture-backed company where everyone gets it, but it's swing for the fences and it's going to be worth nothing or something, you know, 7 or 8, probably 10 years down the line. So I think we're used to that. I think people hear about the wins. They don't hear about the losses. If you look at a venture portfolio, the losses are 90% of it will be worth zero and 10% of it will be worth 10x. And I'm not sure that any of us are smart enough to pick the right one.

No one is.

Yeah. So there's a lot of luck in timing. There's actually a push. Private equity companies historically really incentivize and give equity to the top 25%, 30% of the company. And there's push now with the bigger ones to give kind of equity for all. But there's also an expectation that there's a 3 to 5 year liquidity. So one of the things about having equity and to be meaningful is is that it has to be worth something, right? And there's a lot of people running businesses that they don't intend to sell, family-owned or otherwise. And they're like, well, I'm not sure the equity's gonna be— I don't know what it's worth or motivating for people or otherwise. And so I think some of them might wanna do it, but they don't do it. And it creates this us and them dynamic.

I—

you seem to have solved this in a way that's frustrated a lot of businesses. In a pretty unique way. I mean, I know there's some phantom equity, but especially with the liquidity and sort of how you view, and I'm sure again, this goes back to your childhood and help making other people successful. How have you sort of done this and aligned everyone's incentive and solved the liquidity problem of if I might never sell my business, then how's your equity worth anything?

Yeah. Oh man. I have thought and struggled with this question and gone back and forth so many different times. Because you think about who you're following in business. Like at first I started out and I was thinking like in the startup space and I thought I was going to work on ConvertKit for 2 or 3 years, maybe 4 years, and then sell it. And so like the very first people coming on got equity.

Yeah, this is going to be like a venture. We're going to sell it. We're going to—

you might raise capital, might not. Who knows, right? But this is a 4-year project maybe. And then I got to the point where I realized I love this. This is what I want to do. I want to and I want to stay opted out of the venture track, you know, of go from Series A to B to C and on from there. I think we made it to about $200,000 a month in revenue, no outside capital. And I was like, oh, and we got profitable and it was like, we can do this. And so then I was really listening to, you know, companies like Basecamp and Mailchimp and the Basecamp guys in particular would say all these things like, if you're never going to sell, equity has no value, right?

And they were the big, we're never going to sell our business. But I never then understood how they looked at compensation with the people. Again, how do you get—

I mean, a lot of people paid giant salaries. I mean, they were paying $200,000 a year for engineers when that was 50% over market.

Yeah. Or you say to people, here's a percent of the profit and we'll give you a profit share each year, right? Yeah.

So I had this moment, you know, as I'd flip back to like, we're never going to sell, so I'm not giving out equity. And we did profit sharing. We can talk about that. But I had this moment where I realized that based on the multiples of software companies, I had built this business that was worth like $50 million and it was increasing in value substantially.

So already anything that would have solved any of your needs and your childhood overcompensation and everything, you were, you were already there.

Yeah. And so it was just sort of this thing. An early team member who had equity had left. I had bought back his equity and so equity never has value if you're not going to sell. And I'm like currently making payments to buy equity from someone who had left. And you're like, wait, this doesn't— that clearly has value. And then I hear examples from like Campaign Monitor or Atlassian or some of these other companies who had done— they'd gone on to build incredible independent companies. I mean, Campaign Monitor will eventually kind of sold. I don't know. They end up rolling up a whole bunch of companies, right? But they'd done these secondary rounds and they realized like, oh, if you build a valuable company, someone will always want to buy a part of it.

Yeah. And there is a lot more of a market even in Silicon Valley for that. Like if you don't have to wait till your company sells or go public, there's, there's people if you're in a, but that's a very limited set of popular companies that there's a market for people to buy your stock.

Yep. So in 2018, I realized like, I'm not sure how this is going to have value, but I'm pretty sure it will. And so I took 10% of the company and issued it to the team in the form of stock options. And it was like, hey, we're going to figure this out later. And what we started doing is we started saving a small amount, which is $20,000 a month in an equity buyback pool. And I don't know what the multiple will be and all of that, but at least we're starting that now. And, you know, we have some options there.

And so that's as people want to sell in the future, you will have the cash to buy them out.

Yeah. And we were not saving enough that like it was a substantial amount, right?

Because if your business overperforms, then yeah, then it's going to add up quickly. Yeah. And this is where people understand it from the business side. The problem you need to avoid, it's the run on the bank problem, right? Where people want to sell all their equity at once and you're growing a business and cash is tied up and you in theory want to buy it, but sometimes you can only buy it with a loan, you know, to pay it. There's not enough money.

Well, in the first equity that I bought back, you know, I bought with a seller-financed loan.

Yeah, exactly.

And we paid $250,000 upfront and then the next million we paid over like a 3-year period.

And to be clear, it's not that people don't want to do it, but the same problem. If we all went to try to get our money out of our local bank, there's not enough bills in the bank.

It would not go out.

Right. This is what the FDIC is there for. Yeah.

Yeah. And so we ramped up that over time and it was sort of this thing of like, we're still trying to figure it out. And then a couple of things in In early last year, so 2021, a few things happened at once. One, we got an offer from Spotify to acquire the company or like, like early strong interest. And they, they came in, they're doing a lot in the podcast space and they're like, you know, we had a lot of top podcasts ran their email lists through us, you know, and a lot of great relationships there. They'd purchased Anchor. And so they, they're trying to provide a lot more services in that creator world, basically.

Yeah.

So I thought about it a bunch and then decided like, I don't want to sell. And I think that was the right decision. I was quite happy with that. And then I had team members, right?

I was going to guessing everyone who was about to have a payout might not have been as happy about that.

Yeah. I had a few team members in particular who were like, we've been doing this a long time. Like, we do want to sell. And like we had private equity offers before, but this was like a name brand company. Like it looked really good on, you know, on a resume.

And this was going to be life-changing money for a lot of them, right?

Yeah. Yeah, absolutely. And so I had this problem with people were like, so you're saying you're going to figure out this liquidity thing that was away, you know, what else are you going to do? And I was talking about on my podcast, I was talking about the problem of liquidity in closely held companies.

Yeah.

And I was talking about with Sam Parr, and he'd recently sold The Hustle to HubSpot. And so Dharmesh Shah, who's the CTO and co-founder of HubSpot, who I've known kind of off and on since 2013, I was listening to that episode and we were just talking like high level of like, how do you do this? And there needs to be better solutions and all of that. And like talking about some of these new things, like AngelList was coming out with and Carta and like these platforms are trying to solve this problem. And Dharmesh just said, hey, if you have employees, he sent me an email. If you have employees that want to sell, I would happily buy $1 million worth of stock from someone who wants to sell. Like, I'm going to do my thing, you know, I will never be like, hey, man, where's my 4-year or 6-year return or whatever?

Dharmesh also doesn't need money.

Dharmesh does not need money.

He's, he's doing quite well with HubSpot. He's a great guy.

Yeah. And he's just someone who I've had a ton of respect for and has the ultimate integrity for like a decade that I've known him. And so I was like, oh, this is interesting. And so what we ended up doing is putting together something that I think of as many of the benefits of being publicly traded without a lot of the downsides. And so the way the system works is every 2 years to start out, and then we're going to switch to every year. Once the demand on both sides of the market is there, we're doing secondary rounds and they're not from one big venture or private equity firm or something like that. What it is instead is it's basically friends of ConvertKit, whoever wants to buy shares. You do have to be an accredited investor. Yeah, but AngelList runs the whole process. They spin up a new company, a roll-up vehicle, and so everybody puts money into that and then that roll-up vehicle buys.

So these are people who want to be investors in ConvertKit knowing that you don't ever possibly want to sell, but then they could trade up in a few years, right? Yep.

And so there's these windows.

Yeah.

And so what it ended up being, we chose a $200 million valuation, like kind of just going back and forth with Dharmesh. So we basically said, that's the valuation. Here's the, here's the price. We had 42 people like put in money. The range, you know, we had from checks as little as I think $10,000 to the person who put in the most was like $3.5 million. We ended up returning a lot of money because you were oversubscribed. Yeah, we were well oversubscribed. Actually, it's a friend of ours who we'll talk about separately who put in that money. Another MMT.

I think I know who that is. So yeah.

And yeah, so that was that side. The team, we had about 25 team members sell shares. People sold as much as, like the team member sold the most sold like $1.5 million and the team members who sold the least had sold like $10,000 worth. Someone like, it ranged from like, hey, I'm halfway to a down payment on a house and this is going to kick me over to like, my parents have this medical debt that I've like always wanted to take care of for them. And so they're able to do that.

So it occurs to me in doing this, you might have the opposite problem with employees who don't have liquidity to employees that have too much liquidity because this is supposed to keep them around for the long run, right?

Yeah, there would— yeah, you definitely could.

Can you sell all— if you're vested, can you sell all of your equity in one of these?

Um, the way that we said, like, we— I'm a person who will always like downplay, like, this is, I think, the valuation that we can get, and it's lower than I think what we— you know, I'm like talking about things in very conservative terms.

So they're leaving some money on the table, ostensibly.

Yeah, in theory, right? So like when we had talked about doing equity buyback, we'd be like, you know, that'd probably be like maybe 3 to 4x ARR.

Yeah.

And then we did this round at 7x ARR because I was pretty convinced that like we're not a hypergrowth company anymore, you know, and I was pretty convinced that the market was not going to stay super inflated. And I wanted to think for the long term and I didn't want to be like, here's a $200 million or $300 million round. And then a $250 million.

Well, well, you and I have seen too, when I've seen companies, I know a company that raised during the height of the last thing, a SaaS at like a 20x. I don't think they'll ever grow into their valuation and now they need more money and they'll do a down round and no one will make money. So these, these valuations, they get out of control. If people understand preferences and stuff like that, it can actually destroy—

it can destroy a cap table and a company.

Yeah. And the company in the long run, because other than the founder, particularly if you have outside investors who have preferences, it starts to just, you know, you'll never grow into your pants basically.

Right? Yeah. Yeah. And so I wanted to like put out a system for a long period of time and I think it's, I think it's worked well. I went back and forth a bunch on whether or not my wife and I should sell shares like we've done well and taking profits out of the business. And so, you know, we thought like This isn't going to make a huge difference for us, like, you know, cashing out money right now. But then we talked about it and realized like, oh, it would make a big difference for our parents, like money today versus money 3 or 4 years from now. And so we ended up selling 1.25% of the business ourselves, took $2.5 million and used that to retire all of our parents. And they, you know, they were all like 3 or 4 years from retirement, various levels of comfort. or like cushion in that retirement.

So that just came full circle for you. That was— you took the stress and put it away for that. I mean, that must have been emotional.

Yeah, it was. I mean, I feel emotional just talking about it now.

I can see it. Most people won't be able to see it, but yeah, I can see it. I feel like showing up for the Publishers Clearing House, like, check a little bit.

Yeah. And, um, you know, you always think about how much time someone has and and, uh, my stepdad ended up passing away 5 months later. Wow. Um, and so he passed away knowing that my mom was totally taken care of. So that was, yeah, exactly what you're talking about. Like, it came, came full circle. And it was wild to me that like 1% of anything that you could create could have that big of an impact on so many people. So Yeah, it was, it was wild.

So I know you published this on Twitter, you put out there, are you— and this is your goal, right? You've sort of—

are—

do you have a lot of business owners calling you saying— because again, I think people think they're being greedy. I think a lot of people just don't know how to do this or create— like, are you— how are you— people reaching out to you saying, I want to do this, this was inspiring, can you help me figure out how to do this?

Yeah, I mean, there's a lot of people, uh, Like Mastermind Talks, the community that we're both in, you know, I taught a session for that of like, here's how I think about compensation. You had Jesse Cole on the podcast.

Yeah.

And he and I were just talking. He's like, oh man, I got to figure this out. Like, let's dive in.

And he's got a fast-growing value business.

Yeah.

Where people are all in.

Yeah. Because there's like the structure that I'm going for if you're like a, maybe a peer services business that's not going to have a high multiple, you know, you might want to go with a different setup, right? There's various things like ESOPs. There's a whole bunch of things.

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And there's a bunch of these examples, like around the time that we were doing this, Mailchimp, who had famously said, we're never going to sell. And that had been true for 20 years, right? And they got an offer for $12 billion and we're like, you know, you have no idea what's going on. Like they might have gotten to the point where they're like, look, I'm tired. It's finally time, whatever else. And then they were like, okay, we're going to sell. And they had had this world where they'd always done profit sharing and high, like fair pay and all of that. Instead of equity.

Right. But then, yeah, no one remembers that.

No one remembers that. And they, I mean, they got absolutely skewered in the press and everything else. And like, I know people who worked at Mailchimp, they're very upset about it. I know people who had left Mailchimp like 3 months before that acquisition, you know, and had been there for years and like they got nothing. And I just felt like if we're going to create this much value, you should be able to walk away from the company at any point with some amount of the value that you've created.

We had a very similar thing. We had done it more through Phantom Equity, but I had the same thing. I also think people hang around, or let's say someone's not the right person anymore and you want to move away from them, but you think there could be something that happens in a year or two, then there's potential discomfort or lawsuits versus saying, look, you created this value during this period. Here it is. Or you can hold onto it, or maybe you can hold onto it, but you got to wait till we have enough cash to buy it out. There just seemed to be more ways to not make it. The current system is just so binary, right? It's all or nothing and you have to be there or not be there. And it, like to your example, that person left 3 months earlier after being there for 10 years, they're almost going to want to sue out of anger, right? Yeah. You encouraged me to leave. You didn't tell me this deal was on, like just the timing is someone's going to get screwed on the timing, right?

Yep. And so I think about, well, you're talking about, you know, these binary outcomes and a lot of my approach to compensation is I'm trying to remove the binary thinking. So I actually think about compensation in quadrants. And so if you think about, you know, like a quadrant and across the top, we have short-term versus long-term.

Yeah.

And then down the side, we have guaranteed and performance-based. So I want to hit all 4 buckets. So short-term guaranteed is salary, right? And you got to be competitive there. Long-term guaranteed is your retirement accounts, you know, your 401(k) match. And I like, I just want everyone to max out their retirement. And so we're at a 5% 401(k) match and I want to just keep like steadily ramping that up. And then on the performance-based side, you know, short-term performance-based, we do profit sharing. Like 52% of the profits in the business go to a pool for the team that gets distributed. I think we've paid out like $4.5 million in profits to the team so far in the business.

So you do your profits and then you have to keep giving new equity as people sell too, I assume, right?

Yeah, we still have— I just put another like batch of equity into that pool and that's just for a realization of like I started with owning so much of the business because I waited so long to raise capital and give out equity. That, you know, I can give out a lot of dollars worth of equity and still own 80, 85% of the business.

Yeah. And this is, this is not— I think again, there are people understand too that there's risk equity and then there's not, you know, risk equity. You're getting some— sometimes I remember years ago asking people like, I want equity. I was like, well, there's a $2 million equity line on the business tied to my house. Like, do you want that sort of equity or do you want the upside-only equity? They're like, oh, I want the upside-only equity, you know. There are businesses where there are capital calls where you have to put in money. Like this is the flip side too. It's not always up. People see the winners and they talk about, and again, this is the problem with win-lose. You'll see something like the case you were saying, like, oh, those greedy, you know, whatever founders. There's 90% of the businesses that go under and owe a million dollars. No one's chipping in their salary towards that.

People are actually just mad at those founders too.

Right. They're mad at those founders. But, but. They don't owe money beyond the business going out of business. I mean, I, they're, we've lived in a very crazy 10 years where more things, first of all, no one ever talks about the failures. So they, they're out there. But I, you know, I was interviewing Kevin Cruz, her story where, you know, people remember their family losing their home, losing their stuff. So I, I, I think we've gotten a little skewed on, on risk and reward. And, you know, I've talked to so many founders, I'm sure for you, where at some point the equity line was tied to their house. It was personally guaranteed. Like if it went under, they went under. That is a very forgotten view when things work out.

Oh yeah. And I mean, Warren Buffett talks about that quite a bit of, he's like, no, equity is for the people who take the risk. And so I always appreciate that side of it. We're very blessed to be in the place where the company is very stable and all of that. So like that last quadrant, you know, the long-term performance-based is equity, and that's for the people who, are having the biggest impact in the business. So everyone has equity, but then those who are like having an outsized impact have quite a bit more equity. And so that's the model. And I think we've got it dialed in pretty well. This next summer we're going to do the next, like we're hitting that 2-year mark. And so I put up that Twitter thread because people kept asking about it. I was like, I have not written anything publicly about this.

It was hard to follow on Twitter. You had to go to 10 parts. If you just sent me to a blog, I could have read it all together.

Yeah. But going back to the first thing, Twitter has the distribution built in, correct?

Yeah.

You know, it got read by a million people or whatever.

Is that what it was? So I assume for people who are interested in this journey, you're going to, you'll write about it, share, tell exactly what's working and not working.

Yeah. I try to put it like every 3 to 6 months, I try to write an essay on like, you know, what's actually working. I really want to run this more. Because I feel like, you know, in the arc of building a company, like equity has value. Oh, we're never going to sell. It doesn't. Oh wait, here's how we're going to do it, but we're not sure of the value. And now we've figured out that part of it. Yeah, but I'm a little bit hesitant to say this is what everyone should do because I feel like I'm on step 3 of 10, you know, and doing this a few times and having this track record of these secondary sales. Like if I were looking at it from the skeptic side, I'd be like, dude, you've done this once. Yeah.

And again, during a good environment, what happens when there's a downturn? What happens when valuations go down? Like I think we're seeing a lot of things with the economy on interest. Like we've been in this thing where everything worked in the same direction for 10 years and now interest rates are different. I mean, the whole thing is going to be a little bit different. Yeah.

And I've tried to account for as many of those as possible, right? With the, You know, the friend of ours who put in a bunch of money, we were hanging out at a conference and he was like, why didn't you go with a higher valuation? Like, you could have gone 10x or more on ARR instead of 7x. And I was like, look, I want everyone to have a win. Like, it was a big win for the employees. It was a big win for, for me. And then people who are like, this is unconventional. Yeah, but sure, I want to try it. Like, Next time if we do the valuation at 8 or 9 or 10x, they're like, oh wow, we've, we've gotten a big increase and, and they're seeing that track record and I care much more about long term.

Yeah. My experience, I write one party wins too much at one part of it. There is always a recalibration on the next side.

Yeah. And you get a bunch of VCs who like there's a talk in like VC Twitter about the founders who took advantage of the hot market last fall and winter, and they took advantage of venture capitalists and like, are they going to come down and like mark down these rounds? And it's like, you know, you could get into a case where like, I think that's nonsense.

The VCs, these are not unsophisticated people. I do find that they were just truckloads of money at the top of the market now and almost won't invest anything now with lower valuations and cheaper.

Right.

Which is fascinating.

Yeah. Which is the funniest thing. But You know, it's, it's that case exactly what you're saying. If one side wins too much, then you're going to have a recalibration and I'm, I'm going for consistency and predictability over time.

All right. I know we could talk about this for hours, but, uh, coming to wrap here. So last question I like to ask, and I always say this is multivariate, it can be singular, repeated, or personal or professional, but what's a mistake that you've made that you've learned the most from?

Um, Personally, this isn't a specific mistake. Let me talk about it and see if something else comes to mind. I think I can be very dogmatic of like, this is the way that it's supposed to be. This is the, you know, and now I like even like parroting someone else's, like equity has no value.

Yeah.

You know, and you say that for a while and you're like, wait, that's just not true. You know, or it's only true in this narrow circumstance. And you're like, but what about all of these other things?

So you had to learn, you had to learn to just challenge your own assumptions more.

Yeah. Challenge my own assumptions and then say like, this is what I believe now. And there is a decent chance that 2 years from now I'll be like, yeah, no, I think this other thing.

But that to me, that's good. I was thinking about it, how much we criticize politicians who flop on issues. I was, I was walking the other day and, and, and why I remember Mitt Romney in particular got sort of flayed on. And again, there's strategic reason to do it. But think about the opposite we have today where people won't change their opinion no matter how much facts change versus saying to someone, no, I believed this, but the situation changed, or I was educated, or I heard a viewpoint, right? And I changed it. Like Derek Sivers, I interviewed, still one of my favorite interviews of all time. And he said, my favorite thing in the entire world is to change my mind. Like, I loved, I love that quote. So I was actually thinking how we often call people flip-floppers, but I just find today, like, people won't, I mean, in, in the case of irrefutable evidence that they were wrong, And they will not change their opinion.

Yeah. And so like in the politician sense, it's like, someone's like, hey, we, you know, we should implement X policy. Someone's like, well, in 1988 when you were in the state legislature, here's this clip of you saying the opposite. And they're like, well, yeah, you know, right?

Well, the problem is they say, no, that wasn't me saying it. But the right answer would be, yeah, yeah, I believed that at the time, but then we tried it, it failed. I heard this person speak, we tested this, like, It's interesting. You just don't, you don't hear people willing to, they get caught up in the trap of cognitive dissonance. I just interviewed two people on that. So be interesting.

Yeah. I think one other thing, I don't know if it's a mistake to what level, but I think there's plenty of times in the business that I could have been a lot more aggressive on how quickly we moved on things. I think I underestimated how much speed matters. And so there are plenty of times where I fell more into like the— you can be bootstrapped and move very, very quickly. And I think I was like, well, no, we're not that type of company who like tries to solve problems in a hyper-aggressive way. Something that I think I got wrong is like I was very dogmatic about the way that emails should look like bringing it full circle, right? Like simple plaintext, write it like a human. The words are what matters. Not these like beautiful visual templates or that sort of thing. And there's another company called Flowdesk that came in and built that exact feature and did it like beautiful templates and did it very, very well. And they've grown to $15 million a year in revenue in 3 years or something off of basically one feature. And that was something where I was applying what I believe and was right for me as a creator so strongly in the product that I like missed that wave that if you're a food blogger or a fashion, like you probably want a different experience than like you and I as writers, you know? And so we've come around on that and we've like built a really beautiful email editor and all of that that's rolling out right now. But there are those things. I have a list actually. I, it's just titled Unforced Errors.

Uh, yeah, there's some VCs that do that. They do their anti-portfolio, like they write up the ones they missed.

I think, yeah, it's just good anytime you're about to launch into a big like decision that you feel very strongly about. Yeah, I like to pull up that list and there's only like 4 or 5 things on it. And I actually had forgotten about it when you first asked the question, but, but now of just like, what were the things that I thought I was so right on? And then later I'm like, nope, that, that was unnecessary. You know, I was wrong. And so like one that comes to mind, I think that, you know, ConvertKit could probably be a 30 to 50% larger business if I'd like realize that different creators have different needs in that. In that one area.

So, all right, Nathan, where can people read your musings, learn about you, learn about ConvertKit if they want, if they're interested?

Yeah. So ConvertKit is just at convertkit.com. If you're running an audience like building an email newsletter, you should sign up there. We'll switch you happily for free over to our platform. I write at nathanbarry.com. I've got a weekly newsletter, mostly just what I find interesting, but then Probably every few weeks I drop an essay that's like, here's what I actually think on a topic. And then I'm on Twitter, just @NathanBarry. And that's the audience that I'm most trying to grow. Though I finally started listening to you and I started building an audience on LinkedIn yesterday, added 1,000 subscribers yesterday. So we went from—

What did you do to add 1,000 in one day?

We'll talk about that offline. I took one of my very popular Twitter threads and reposted on LinkedIn. Interesting. So we went from 1,700 followers on LinkedIn to 2,700.

So the advantage is you can write a piece in full sentences, uh, with images.

It is an advantage. You're right.

When you're writing thought pieces. So, all right, Nathan, thanks for joining us. I always, uh, learn something from our conversations and I look forward to seeing you again, uh, soon in the real world.

Sounds good. Thank you. All right.

You can learn more about Nathan and ConvertKit on the episode page at robertglaser.com. If you enjoyed today's episode or the Elevate podcast in general, as always, I'd really appreciate if you could leave us a review. It's what helps new users discover the show. Thank you again for your support. Until next time, keep elevating.