Lost $100K Then Built a Bootstrapped SaaS Startup to $500K

Omer (00:11.600)
Welcome to another episode of the SaaS Podcast.
I'm your host, Omer Khan and this is the show where I interview proven founders and industry experts who share their strategies and insights to help you build, launch and grow your SaaS business.
This week's interview is a story about two guys who decided that they were going to build their own webinar software.
They'd spotted a gap in the market and believed their idea could succeed.
But neither of the founders were technical, so they hired a company to build the first version of their product.
They spent almost $100,000 and ended up with a buggy and poor quality product which they basically had to throw away.
Having learned a very important lesson for $100,000, they decided to start again and this time did a much better job hiring the right developer and being more involved in the design and development of the product.
It took them a long time to get things right.
Their product was in beta for two years, but in the end, the hard work and patience paid off.
Currently they're generating about $500,000 in annual revenue and and are growing fast.
It's a great story and there are a number of valuable lessons in this interview, so I hope you enjoy it.
Today's guest is the co founder of demeo, a webinar platform that helps businesses to engage, communicate and build relationships with their prospects and customers.
The company was founded in 2014, but it took the founders about two years to develop the beta and launch.
So the product has been in market for about a year.
The company is self funded and based in Tampa, Florida.
So today I'd like to welcome David Abrahams.
David, welcome to the show.

David Abrams (02:06.490)
Hey, thanks so much for having me.
I'm excited to be here.

Omer (02:09.770)
Now I want to start by getting inside your head a little bit.
Just figure out what makes you tick.
So what is it that gets you out of bed every day to work on your business?

David Abrams (02:18.890)
That's a great question.
There's a lot of stuff there.
But I'm going to start with maybe a quote is best.

Omer (02:24.810)
Sure.

David Abrams (02:25.770)
But I have a quote from Chuck Polaniak that I absolutely love.
It says, we all die.
The goal isn't to live forever.
The goal is to create something that will.
And I think for me, when I take a look at my life and I really think about my deep why and I really try to think about what it is that gets me out of bed.
It's the idea of building something great.
It's just being able to create something that will last longer than me and be able to impact the world.
And I think that starts in Demio.
I think Demio may be a stepping stone in my life, but that's kind of what gets me out of bed every day.

Omer (02:57.350)
Nice.
Okay, so let's talk about Demio.
I gave the audience a little bit of an overview of what the product is, but in your own words, tell us what you know, who are your target customers or target market, and what's the problem that you're trying to solve for them with Demio.

David Abrams (03:16.060)
So I think for us, we kind of have like this weird split right now because when we started building Demio, we had a target market, but that target market has shifted and is going to shift again here very soon.
We're going to do a pricing change which will move us more up market and I think to kind of where our real avatar is.
But right now our avatar is mostly small to medium businesses, even very small vsmbs, small businesses.
Solopreneurs.
A lot of those solopreneurs may be in the coaching or consulting or online marketing niche.
And so that's kind of where we started.
And the reason we started there was because of previous businesses that we had and ran and the connections and network that we had grown with those businesses.
So those businesses had kind of leveraged our relationship in the marketplace.
And once we were there, we wanted to go and basically bringing customers, since we went after those customers, that demographic of customer base.
And then we ended up taking a look at where we are now and we said we really want to go up market and have a new avatar.
But I think the problem that we're solving remains the same and that really is creating what we call a delightful webinar experience.
I think for most people running webinars, there are technology that gives you video communication and stuff like that.
But at the end of the day, what people want is a simple, easy to use platform that's reliable, that they can trust, that their audience likes.
But it also helps them either convert leads into customers or retain customers, reduce, churn, stuff like that.

Omer (04:45.000)
All right, so let's go back to 2014 or I guess even earlier, before you had launched the business.
Where did the idea come from?
How did you guys come up with the idea for Demio?

David Abrams (04:56.600)
Yes, the idea really did come in the end of 2014.
That's kind of when we started.
And my co founder himself originally took the idea and came out with it.
And I came on, started consulting with it, and then ended up coming into the business.
So I came on a month or two after we kind of got started There.
But with the thought process that kind of went through our head is when we started, there weren't a lot of the competing platforms that are out now.
Really.
There are a couple major players.
And what we saw in the marketplace was the same pain that we are experiencing.
So we have, like I said, our own side businesses and stuff like that, and we were using webinars to sell and market our own products.
But we were continually having issues where platforms that go to webinar would either freeze or crash on us.
I think Google Hangouts had just come out and they were super delayed and really slow.
And that platform webinar gym hadn't even come out yet when we had started on this stuff.
And so we wanted to build a platform that had all the marketing and sales automation that we needed.
With GoToWebinar, we had three or four different platforms that were putting together, kind of lining them up, doing all this extra automation.
We were paying for all these different things.
We really just wanted to have a very nice, seamless experience.
So we came up with this idea.
We wanted to go through with it.
Now, it took us quite a while to get it.
And a lot of that time while we were building this out, other people came into the marketplace.
So I think a lot of stuff had actually changed when we came up with this idea.
Like a lot of what our initial idea was, which was building a very robust platform with all of these different options where you have live and automated and hybrid and all these different demo rooms, all these crazy things.
We had so many features when we first started on our initial idea, but that idea has kind of really slimmed down into being a simple and easy to use platform.
But it really did come from our own pain.
And then when we looked on Facebook and Twitter and stuff like that, we just saw a marketplace, literally speaking on Facebook and Twitter about the pain that they had.
Oh, they wanted a new platform.
Oh, they're looking for a great platform so we could visually see that there was a pain point in the marketplace.
And.
And so we started talking to people and they're like, yeah, I would love a platform like that.
So we did some very, very basic initial kind of research.
But again, I think 90% of where it came from was based on our own pain.

Omer (07:08.560)
Give me an example of, of one of those pains you mentioned, integrating with different tools, if maybe that's a good example, but just kind of kind of walk us through, like, what you were having to do and why it was so difficult.

David Abrams (07:23.200)
Sure.
I mean, I think, you know, first and foremost, we Wanted to integrate our webinar platform with our CRM.
So we had to hook those up.
And this is before.
I mean, I think maybe zapier was around, but we used Zapier to basically Zap attendees from GoToWebinar into our CRM.
We had to add a landing page provider and connect those two.
So then we had three applications there.
And then if we wanted to segment our audience out of gotowebinar.
Now, who came, who didn't come, who did that?
We had to use another third party provider to send that information back to infusionsoft and then make the campaign.
So it was just.
Everything was all over the place.
It was really jagged.
It took a lot of time.
At this time, in my other side business, I was doing some consulting and stuff like that and some funnel building.
So I was actually doing this for other people's businesses.
I could see that everybody struggled to set these up, but you needed these tools to actually have a powerful webinar campaign.
Like, you wanted to know the people that didn't show up.
You want to market to them a different way than the people that showed up and completed.
So it's a really big part of your webinar campaign.
But it just took so much to put together.
So we were like, why can't we just have a seamless, easy way to do this?
Why doesn't this exist yet?

Omer (08:29.900)
Yeah, okay, so.
So the logic so far sounds pretty good.
You guys have seen, you're experiencing the pain yourself.
You're seeing this with, with clients.
You've done some, let's call it, you know, lightweight validation of the.
The problem or the idea.
And you're hearing from the market that, you know, people, it sort of resonates with people and they're, they're looking for a better way to, to run webinars.
What did you guys do next?
Was it kind of taking some baby steps to go out and further test the idea and getting an mvp, or did you sort of decide to go all in pretty quickly?

David Abrams (09:10.609)
You know, I think we were both coming out of, you know, like these side businesses, like I said.
And this was.
Although we had done software, like smaller softwares and stuff like that, this was for sure our biggest software to date, and it was the most robust one we've ever worked on.
So we were kind of naive, to be honest with you.
That would probably be the best way to describe it.
We're all in on this idea.
We didn't even really validate any more than what we had seen.
And kind of our own Pain.
We're like, we know we can do this.
We can do something awesome.
Find some really good marketing angles and do a great job.
So we jumped in really.
Kind of where we started was doing some technical due diligence, seeing what it would take to kind of get around any MVP or not any MVPs, but any, you know, issues as far as technical issues.
But even this was kind of basically done.
We hired a consultant to kind of go through what it would look like, kind of map out our initial spec.
And this spec was not like, speaking of MVPs, was not an MVP.
This was like a big spec of probably like enterprise level software.
And then we went out and we're like, let's just build it.
And we just started putting money in to build it.
So I think if there's one mistake that, that I can say that we made it was that we didn't know about an mvp.
We didn't prioritize an mvp, and we didn't chunk our idea down to be validated quickly and easily.
And when you spoke earlier about our journey taking almost two years to get to market, I would say that's probably our biggest reason why is that not only did we fall into technical hurdles and technical pitfalls along the way because of a very robust platform, we also had to reshift and change some of what our software did or what we wanted to do.
Because we didn't start with an MVP and build on top of it.
We went super robust and then had to clean up from there.

Omer (10:53.160)
Okay, so, yeah, I mean, I was going to say, well, you guys didn't really do much with an mvp, but.
But as we'll sort of talk later, that hasn't particularly hindered the progress.
And you guys are doing pretty well for a product that's really been sort of launched, I guess, a year ago.
But at the same time, I guess what I'm hearing is that if you had gone down the, the path of building an mvp, you'd probably still be where you are today, but you would have got here faster and maybe had less detours along the way.
Is that a fair summary?

David Abrams (11:32.800)
Yeah, absolutely.
It's a very fair summary.
I mean, we're totally bootstrapped.
That's something you're really pointing to say.
So I think, you know, losing time was losing money, but obviously losing time was, was very.
Time is the most valuable asset you have.
So we lost a lot of time, I think, by not doing it that way.
Where we learned the lessons it took us, we went the hard approach, basically.
To say we got smacked up and down learning everything that you had to learn.
We could have just gone the MVP route and done it right.
But obviously it took us the path that we went down to learn that.
So we spent a lot of money going these routes.
We nearly depleted most of our bootstrapped funding to do it.
We got here, we're here, we're doing good.
But I think those early days, there's a lot of lessons to be learned.
We always try to document during that time, our journey and try to showcase what was happening and why we were doing the things we do.
And we look back now on this journey, it's just like we see just so many mistakes and stuff that we can easily learn from.

Omer (12:30.420)
Do either of you technical.
Do you code?
Did you have to hire a team to start building the product?

David Abrams (12:37.540)
Yeah, that's exactly where most of our bootstrap funds went to, was building a team.
Because we're not technical co founders.
We're actually both from more the business marketing operations side.
So we are more like biz dev area.
And so we had like an office and we were going to fill it with developers, but we ended up hiring some people overseas and just wanted to get great people.
So then we ended up having this office with no developers in it.
But really for us, it was, we got to get great people in.
We knew that we needed to get great people in to build this product.
But that also became kind of something that we can talk about a little bit, which is just how we had to learn to hire and the mistakes that we made on hiring the wrong people.

Omer (13:18.680)
How much money did you guys put into getting this business off the ground?

David Abrams (13:23.560)
So to get up to beta, which we did a free beta version for three months, we did free beta.
We spent roughly around $450,000 in development in about two years.

Omer (13:35.760)
And that was all from consulting revenue that you guys had sort of accrued.

David Abrams (13:44.000)
So our other businesses were actually more in like the Internet marketing, lifestyle marketing businesses, where my partner had a SEO company and he had launched some softwares, I had launched some other softwares, we had other software products.
And then I was also doing consulting and other work as well.

Omer (13:58.610)
Yeah, I mean, I want to get into kind of the.
The building the team and sort of the.
The lessons and the mistakes that you kind of went through.
Because I think those two years are really.
It's a really interesting time in terms of how you guys evolved the business.
One question I had was, when you started out in 2014, maybe the webinar market wasn't as crowded as it is today.
And over those two years, you probably saw a number of new competitors coming into the market.
How did you react to that in terms of did you guys try to just put that to the side and stay focused on what you had decided to build, or was that kind of a process of you continuously looking at what was happening in the market with these new players and then using some of that research and insights to go back and refine what your product design was like?

David Abrams (15:06.779)
It's a great question.
And so I think it's kind of multifaceted.
So I'm going to first say, I think initially there weren't a lot of competitors when we were coming into this.
And I think the reason being was that streaming was kind of expensive to do.
It was really like the way that GoToWebinar and Zoom work and Cisco, WebEx and all these companies, they use a very unique type of streaming that takes a lot of dedicated infrastructure to build and stuff like that.
So streaming was not the easiest thing to do.
So I think jumping into a streaming engine, again, I think naive was a good word.
Earlier I said that we could just build this great big streaming engine with all these features and do exactly what we want with low time, like low, no delays, really fast connections, all that kind of stuff.
That was kind of naive of us to even think that was possible because we're not developers.
We had this kind of unique mindset.
When we started getting into it and learning more about the streaming and the technologies, we saw a technology that was emerging, which was WebRTC.
And this is a peer to peer network connection that allows you to have basically real time connections with people very easily.
So with the rise of this technology started coming a rise of all these kind of new players into the marketplace.
So about a year into where we were, that's when a lot of these players started to come out and really start to bring these products to market was because of this new technology.
Now we had already built in a full year a product on an old streaming technology that wasn't as fast.
And we literally already had paid beta members during this time that we had to basically cancel and refund everyone, go back to ground zero and rebuild our technology to be WebRTC based so that we could catch up with the competitors.
Now, initially, when I came into this, I was always a very competitive person myself and I would look at competitors and maybe get a little downtrodden or just feel like, look at what they're doing.
Look at what they're doing.
We need to do this, we need to do that.
And I think for a little bit kind of took away from our energy because we were looking at what other people were doing.
But then we realized that if we could focus on what we knew we wanted to be like our vision of our product and kind of just put blinders on what we could really focus on, what makes us unique.
And we kind of had this hypothesis, right, so your MVP is your hypothesis anyways.
But our hypothesis was that people would just rather have a simple, easy to use platform, very minimalistic user interface.
There's not a lot of technical things, it's really fast to use, it's real time connections.
And we kind of had this approach where what things would people never want, never want less of?
So like they would never want or never want, I guess more of.
So they wouldn't want more delay, they wouldn't want more steps to take, they wouldn't want, you know, more technology to deal with.
So we try to take that approach to it.
So as we kind of grew and evolved through, through these years, we really started putting blinders on and there are still like, we don't even look at our competitors anymore.
I mean on some level we do just to, you know, to just to monitor small stuff in the marketplace, but we definitely don't do it anymore to kind of see like what is, you know, what is out there, what do we need to do stuff like that.

Omer (18:15.360)
Let's talk about the building out the team.
So you've got the idea, you've decided you want to make the investment.
You mentioned hiring somebody to come and help with kind of scoping out the sort of the design of the product.
How did you go about getting your first developer on board?

David Abrams (18:37.150)
It's a great question.
So we started with that consultant and he actually recommended his brother in law who was living in Turkey and owned this really amazing development agency.
And so we flew him out from Turkey, we sat with him for a week and we went through like again this gigantic idea of what our software was going to be.
And we like specked it all out and we're like, this is the kicker.
We're like, all right, let's get it done in two months.
And I mean this thing was gigantic.
And he looks at it, looks at us, he's like, all right.
So we pay him all this money.
We do kind of bulk payments to this agency.
Some family stuff happened, I had to leave and come back.
And when we kind of got back into, we were starting to go through what was coming out the other end.
And we weren't really didn't have our fingers on the pulse of kind of like what the developers were doing.
We just let them develop with this guy kind of in charge of everything, kind of being like quote unquote CTO almost.
And when we came back, it was just terrible.
Nothing basically worked.
We put in all this money and just got burned.
I mean burned bad.
And basically we had to scrap after almost putting in six figures from all this funding into this agency, had to start from scratch.
It was really hard.
And so we said, this time we're not going to do the same mistake.
We're not going to get burned again.
We're really going to keep our fingers on the pulse.
We're going to hire ourselves.
So luckily in my consulting agency before, one of the things that I would do was help find and hire developers.
I've actually have a pretty strong system of hiring that I've been hired into other companies to help them do.
So I kind of had a good systematic idea of how to hire and what to look for.
But from the level of developers and what we were looking for now, this was kind of a new venture for me.
So initially I was on platforms like I think it's upwork at this time.
It used to be odes upwork and stuff like that, looking for developers.
Now what I really wanted to do was just find great talent.
We had this idea that if we could just find great talent, we didn't want to limit it to a certain location size, so we were looking everywhere.
But we had a development process which included having people fill out not just responding to our post with a specific keyword, but following up with questions.
Then we did a three part interview series where we did unique questions on each interview.
And then we had like a development test.
And for the development test we hired a consultant to write these tests for us so that we could actually judge who they were.
So we initially hired our first developer who's still with us, and he's absolutely amazing.
Like without him we probably would not be here at all.
He's just fantastic.
And so we luckily got him on board and with his help we were able to hire some more people.
And he helped do some of those development tasks and, and judge some of these scores.
And one of the interview styles was the development interview.
We ended up bringing on about seven people ourselves, just seven developers.
And here's another big mistake that we made is that we felt that we had been burned.
We'd lost time.
We probably lost six months of time, almost $100,000.
This agency had kind of burned us and we're like, man, we're so far behind.
We need to rush through this thing.
We need to get this thing up.
We're six months behind.
We'd already done pre marketing, so we hired fast.
We didn't hire great.
These weren't like, I wouldn't say like everyone in that set.
I would say the first hire was amazing and the rest were kind of like, let's just get them in positions quickly.
Like people that just felt like they were okay, they were good, but they weren't like the best people that we could possibly get.
And we hired fast and we didn't really have still a clean, small MVP or clean spec.
So we just kind of threw, threw people in and we just pounded the payment for about six months and really just did everything we could with these people to just try to get us back to where we needed to be to get to market.
And this is where we kind of came out with our first beta version.
And this is the one where the streaming tech was still outdated.
We still a little bit used the initial CTO's architecture and because of that it set us back again.
But I think the lesson that I can say here is that first hire, we did great.
The rest of the hires we hired really fast.
And I just think that those early hires are so critical to your success.
Like if we had just hired two people instead of seven people and we had done that second hire just as good as we did that first hire and we literally sat down and spent a month specing it again and looking at all of our options and looking at our scaling architecture, we probably could have avoided that six months and that huge overhead of six months that we used to just kind of rush and like power through, I guess our initial release again.

Omer (23:03.490)
How many of those seven hires are still with you?

David Abrams (23:07.810)
So honestly, I think one guy came in very near the end.
He's still with us.
He's an amazing front end developer.
Front end and JavaScript developer.
That first guy obviously is still with us.
He's definitely our lead engineer at this point.
So I would say maybe two of those seven are still with us.
So five people we had to let go.
And then we have another guy now on our team, another very high level senior developer on the streaming side who's just fantastic.
But he was someone that came this year so much later in the process.
And we did a very long, we do a very long hiring cycle now where we really try not to feel rushed when we hire.
Even if we're in the position where we need a position filled, we know the mistake of hiring too fast.
So we really try to go slow and make sure it's the right person.
Like a cultural fit, a business fit, an understanding of the product and understanding of the development.
Technology has a good mindset to like, you know, think through challenges, all that kind of stuff.

Omer (24:05.750)
One kind of observation I want to make here is that I think what you went through there isn't that uncommon.
And I think part of it is driven by.
It's kind of a balance between, like, time, time, money and quality.
And, and when you're, when you kind of feel like you're behind the eight ball a bit, you're kind of really focused on saying, you know, we're.
We're kind of burning money, we're wasting time.
We really need to get people on board quickly and build this product.
And the downside of that is that you don't necessarily anticipate the.
The challenges that are going to come along the way when you actually start building it.
In terms of technical challenges, talent chall.
It's kind of a difficult decision to make when you're, when you're kind of going through it for the first time, I think.
But as you've kind of gone through that experience now, and I think what I'm hearing from you is that, you know, look, we.
We kind of learned our lesson and now we.
We would be much more comfortable.
Even though if we feel like we're behind schedule and we're having to spend a bit more money, it's much more worth the time taking the time to hire, slowly hire the right people, because it'll pay off down the line when you're actually in the weeds of building the product.

David Abrams (25:25.700)
You're absolutely right.
You're absolutely right.
And I think, you know, I kind of have this thought process that no matter how many times you read things like, we read everything on SAS here, we read all the blog posts and Quora posts and everything about growing a business in SaaS and stuff like that.
But until you're actually in the experience and doing it, there are lessons that you only learn by, like putting your hand on the stove.
You know, everyone can tell you the stove is hot, but the moment you put your hand on the stove, trust me, you believe it and you learn that lesson fast.
And I think for us, you know, we learn the lessons, and I don't regret a single second of it because it taught us so much and it helped us grow.
And I think a lot of Times it's easy to fall in love with the idea of a startup or the idea of a software, the idea of a SaaS.
The hard part is the discipline in it to understand, you know, how to do it correctly.
Because there's like, you know, you hear all these cool stories and stuff like that.
Not saying that we were like reading these stories and falling in love with it, but I think you don't think about in the weeds how tough it can be until you learn those lessons.

Omer (26:26.870)
So.
Okay, so we've talked a little bit about hiring and hiring the right people.
One of the mistakes you also mentioned was not having an MVP and how that pushed you in several different directions over the course of those two years as you were trying to sort of launch the product.
Can you talk a little bit about some of those changes in direction or parts of the product design or plan that you had to kind of scale back, refocus, do differently because of the lack of an MVP early on?

David Abrams (27:07.390)
Yeah, absolutely.
The lack of an MVP taught us.
I mean, I think this lack of an MVP is tied into some of the hiring things because our mvp, like quote, unquote, mvp, our initial idea and our initial spec was so big.
We needed so many developers and there were so many different languages and probably redundancies and million failover points across the board because it was so big.
So the biggest thing was because we made it so big, we made our path to, to actually get to market so difficult.
So we realized that to get to market in an actual quick pace, to start making money and validate our idea, we had to simplify and it was that simple.
When we made that kind of mindset shift, we're like, oh, okay.
So what we started to do was really just cut out and take away everything that we didn't actually need.
So kind of the reverse of what you're supposed to do with mvp, right?
So we started cutting out a lot of the features that didn't matter.
And what we realized was what really mattered for us was crazy enough, right?
The video streaming.
We needed to have a good video streaming platform.
We needed to have a reliable service that could scale and some of the small business and marketing things as well.
So we wanted to have handouts and call to actions.
We wanted to have integrations that segmented based on what happened on the webinar.
And that was it.
Those were the things that we started with.
That's our mvp.
And even that is still pretty big because the streaming and stuff has just so much that goes into it.
But we said okay, this is what we need.
Because at the base level, this is what we are.
We're just a streaming platform that has some marketing and segmentation pieces to it.
So it really took us some time.
It was kind of hard to do this, but cut out a lot of what we had already envisioned, chipped it away and started small.
And what we did to actually implement this quickly into the company was we said, we're going to go free beta.
And with free beta, we said, we're going to make this transition pretty quickly.
So we had to basically say, listen, to make the entire company simplified, we're going to let go of all of these different features and we're going to let people in for free.
So because they're coming in for free, we're not going to make any money.
We won't have money for support.
So we need to minimize support tickets.
We minimize that, the difficulty to use the software.
So it caused us to actually force ourselves into this mvp.
We stripped out everything.
We left it bare bones, brought in almost a thousand people for free beta who like organically came in for free beta, which was amazing.
And I mean, everything else from there is kind of history.
They really helped us to then understand which features we needed, what to add back on and everything like that.

Omer (29:40.390)
How did you get the word out, get those thousand?

David Abrams (29:44.470)
So we actually did a couple things.
So like I said, we were doing this kind of this YouTube video series called Inside Demi.
We were kind of filming everything that was happening as we were trying to build this company.
And it was about 20 episodes of just lots of mistakes and us just trying to figure out what we were doing the entire time.
But that actually got a lot of traction.
We would put them on YouTube, we would put them on Facebook, and we would put some video ads behind, behind it, like $5 a day in video ads.
And we run them.
We got a pretty good sized audience.
And all that went Back to the Demio.com website, which was a landing page that had people that could sign up for the waiting list.
And then when we got closer to free beta, we had it on a free beta list so you could sign up to be on beta.
Then we did.
When beta rolled around, we did some email marketing to that list that had grown and we announced that there was free beta.
And we also started opening this affiliate program for people, letting them know there was going to be a grand opening launch coming up and they could actually bring in people into free beta now.
And anyone that ended up converting in beta, they would get a percentage of that sale.
Right.
So some affiliate percentage or referral percentage from that grand opening.
So this got us pretty much all organic beta signups.
We posted on social media and stuff like that.
So on our own social media, we did some small Facebook ads, but most of this was actually word of mouth referral.
And still to this day, most of our customers still come from word of mouth referral or the viral loop.
And that's the other big thing.
So when people got into beta and they started running webinars, we started getting these small viral loops.
So if you run a webinar to 100 people, that's 100 people that saw the system or they saw the emails that went out, or they saw the thank you pages, and all of those things had links to sign up for free beta.
So it just kind of made this little organic loop for us.

Omer (31:26.180)
Okay, I like that.
It's really, you know, simple.
You didn't overcomplicate what you were doing.
Well, I mean, your background is in marketing, right?
So you might expect that.
But yeah, I really like that.
It's.
And I guess this is the core of the pre marketing that you mentioned earlier.

David Abrams (31:45.630)
Exactly.
This was the core of the pre marketing.
And we were doing even before the show that we made inside Demio, we were still doing like teaser videos and video advertisements and stuff like that.
And honestly, some of it became like, looking back now was on some level, market validation because we were putting out these ads, which some of them were screenshots of our platform and stuff like that, and having text that was saying, imagine a platform that had these features.
And we would put the screenshots of our features in there and we would run them with like $5 a day.
We would look at the comments and stuff like that, see what people were tagging people about the company.
So we were kind of building up a name and a buzz almost a year and a half before even beta came out.

Omer (32:24.770)
Okay, so you went through the two years of running the beta and at some point you decided, okay, we're ready to launch and we're going to start charging.
So, number one, how did you decide what you were going to charge for the product?
And secondly, how did you manage the people that had been had gotten used to using the product for free for over a year.

David Abrams (32:56.880)
So the free beta was actually only at this point going on for three months.
And we probably would have extended that farther, but we were running out of Runway.
We had a very fast approaching CCD zero cash date from our bootstrap funds.
And we knew that we had to get out there and launch the product.
We had to make sales.
And the other option was looking at funding, but without any sales and being in free beta and that so much time and effort put in, we knew that we probably wouldn't get good terms on funding.
And it was going to be a hard road and we didn't know if we're going to make it.
So we said, let's do it on our own.
We'll launch this product, we'll bring in cash, and that'll be our cash flow to move forward.
So we decided that we wanted to open the doors and we had to cut beta short.
We honestly would have probably kept it open longer had we had the ability to.
So we looked at what we wanted to do.
We knew we wanted to do something that made a splash in the marketplace.
So we decided to do a launch using affiliate and referral partners as our primary traffic source to open the accounts.
So initially when people were coming in free beta, we had blog posts and stuff like that, like journey blog posts.
And we talked about this everywhere, is that beta would be free until our grand opening.
So we initially kind of open looped it.
They knew that there was going to be a grand opening at some time.
We didn't have a specific date when we first opened free beta, we didn't know when that date was going to be.
But we did have the expectations set.
So we first said, this is why we're doing free beta.
We want to get you guys in, we want to learn about the product, we want to make a better product for you and we want to make it simple.
So people were coming in.
They loved that stuff.
For a lot of people that came in, we still saw a little bit of a lower, this is just something, FYI, that came to my head, a little bit of a lower usage level on some of the free people that were coming in.
But the people that actually did use the platform gave us great feedback.
A lot of those people signed up to be affiliate and referral partners.
Instantly we had those.
We also reached out to our network for the grand opening pricing.
We said, okay, what can we do that would make a splash?
We didn't want to do lifetime sales or anything like that, but we still needed to get cash flow in.
So we looked at doing annual sales.
We said, okay, we want to do annual sales.
At least that way we can bring in upfront cash, we can give a good percentage to these referral partners that are coming in.
So we decided on a 40% referral commission structure.
So people could make a good amount of money.
And we looked at what we already decided what our package costs were going to be.
But we wanted to do something special for seven day period of our grand opening.
And we discounted prices by almost, I want to say almost 50% was the discounted pricing.
In some cases even more.
I think like our packages were 237, 367 and 497.
And the 497 package now is $2,300.
So it was a pretty huge discounted deal.
And everyone got these grandfathered discounts for life.
But we were still able to give great commissions to the referral partners because we were still multi hundred dollar sales.
So we were able to launch with that and we were able to get the six months of Runway that we wanted.
So we were able to hit our goals.
It was amazing during this launch.
And basically everyone that bought in has an amazing discount because we're raising our prices again soon.
So now they're going to have this amazing discount for life.
But that was kind of the incentive that we wanted to do.
So we didn't get any really backlash from people that went from free beta to paid.
I think we did about almost 10% conversion, I think was the number from free beta into paid accounts.
And then we had customers that came in off the free traffic.
And for months after that we still got people begging for that to discount, but we discontinued it after seven days.

Omer (36:25.590)
Okay, so let's talk about revenue.
How much are you guys doing at the moment?

David Abrams (36:32.630)
So right now we're north of, I believe 42 k. Mrr.

Omer (36:36.950)
Awesome.
So about about half a million annual run rate is exactly where you guys are currently at.
Okay, cool.
So you, you mentioned that.
Okay, so you did the discount, you did the launch, you got people on board and then you, you said that you're raising prices again or have raised prices again.
Tell, tell me a little bit about why you're doing that and what sort of the strategic thinking behind that is.
And I think the, the reason I'm kind of, I want to kind of pick your brain here is because in a, in a market like this where there are a lot of competitors, it can be, it can be quite tempting to focus on price as the differentiator.
Right.
In terms of.
Yeah, we have the cheapest webinar platform that you can use.
And that's not necessarily the smartest thing to do.
And so it will be good to understand in terms of how you have managed to sort of continue to differentiate and which is I guess allowed you to continue to raise your prices?

David Abrams (37:54.300)
No, I think that's, I mean it's a wonderful thing to think about.
So when we first started and this kind of the launch pricing is kind of into this as well, we did want to go under, under the market and what we considered our biggest competitor, which would be like GoToWebinar, we wanted to go under their pricing and we wanted to do that strategically to slip into the market and initially get traction that way.
Because we knew honestly out of the gate we probably wouldn't be able to compete or be as good as a platform that's been around for 15 years.
So we knew that pricing was going to be our kind of advantageous point to get customers in and then learn and grow from there.
So we wanted to start low note, knowing that we could raise prices.
And we didn't want pricing to be our major differentiator, but we wanted to allow us some ease into the marketplace.
So again we did that grand opening launch that was the lowest prices ever.
Honestly it came out to like $19 a month or something like that on one of the plans.
So super low.
But I think price, the big thing with price is that it's the attractor to the customer avatar.
And at the beginning when we were talking about who is our customer now, which I say is almost like a very small business owner or like a solopreneur, where we want to go is more upmarket into some of the best companies and customers that we have that use us all the time in different fashions are more SaaS companies, bigger consultancies, medium sized businesses, larger businesses that have possibly marketing teams, stuff like that.
They're using webinars in a multitude of ways because one that helps us be utilized by these companies and stuff like that.
So at our thought process now is twofold.
So this pricing change that's about to happen is one to help us go up market a little bit.
So pull us out of being just underpriced people switching to us for that.
We know that already all of the testimonials and all the feedback that we get is just based around that we're easy to use, that we're simple, that it's just push and play.
Their attendees really enjoyed the experience, that it was just a nice experience.
That is our kind of our usp just a delightful simple webinar experience, but also has the marketing power.
So with this new pricing change, one it's moving us upmarket.
We also have a big internal streaming architectural change happening.
And with that a bunch of things are growing in the platform.
And so we know this is a good time to justify a pricing change because we're getting bigger, we're getting better, they're going to get more stuff.
Now our current customers are going to keep their products pricing.
They're not going to have to change pricing.
But all new customers that come in will be paying the new pricing.
So one, this kind of gives us a nice little promotional scarcity period leading up to this pricing change.
But once the pricing change is there, there will not be any going back to past prices.
Now the other thing that we're doing is we're doing a pro and normal plan.
So with the pro plan, you can get more marketing and sales features unlocked on your account.
And what this is going to do, the plan for this is actually to help us to attract the right customers in those pro plans to reduce churn and to also just solidify and get to the right people that may not need a bigger attendee room size, but just want more marketing and sales tools in their webinar itself.

Omer (41:04.359)
How are you changing your marketing to go and reach these new types of customers?

David Abrams (41:10.920)
Yeah, so we're actually doing, we're really trying to again, focus being a key thing that we always try to do, focus on one marketing aspect at a time.
So first is going to be leading up to this launch, right, this relaunch of the pricing and the product and stuff like that.
We're now also doing a very big push, a heavy push on content marketing.
So the big push here is we're creating basically a journey blog, really in depth journey blog along with a podcast as well as really highly optimized SEO optimized content.
So our goal now is to create great content that talks and speaks now to the right customer demographic.
Where before we were really using word of mouth referral marketing to attract people in the space that we already knew, now we're going after a more long term organic approach.
And then after we have that kind of solidified, we're going to be doing and going back to advertising approach, then marketing that demographic.

Omer (42:07.630)
Okay, cool.
So kind of summarizing, as you sort of look back, the sort of the mistakes that I heard you talk about were and I think they're kind of all interrelated to some degree.
One was the challenges around hiring the right team and what you learned from that.
Secondly was not having a minimum viable product and you know, how you had to make a number of shifts in direction and maybe learn, take longer to learn than you would have would have liked.
And thirdly, I think is just sort of that.
That sort of lack of the.
The clear vision, which I think resulted from maybe.
Maybe the sort of the MVP.
Aside from those three things, if you were sort of going back to 2014, 2015, what advice would you be giving yourself?
What would you.
Beyond those three things, what else would you be doing differently?

David Abrams (43:09.600)
You know, I would definitely say slow down.
I think almost like you talked about before, like there's.
You kind of feel this rush and this pressure with time.
And I think slowing down and thinking strategically would be a very, very important thing to do.
So that would really be, you know, a focus on that mvp.
I think that was the biggest thing, was understanding what is our core mvp.
What do we want to do, how do we get the right people in place to do it and without rushing through it?
I think moving too fast can be just as dangerous as moving too slow.
So you want to find the right pace and you just want to be strategic with your approach.
I definitely think those are some of the key things.
But I also think failing fast, just learn.
Fail fast, move on to the next thing.
Don't get too down on it.

Omer (43:59.510)
One interesting question that I have for you, and I don't know if.
If it's kind of.
It's going to be a guesstimate on your part.
Early on, you talked about this pretty complex and big product that you guys had designed and wanted to build.
And then eventually you realized that it was too big and you had to scale down.
When you look at the product today, compared to this grand design that you had early on, have you built that product yet or in terms of percentage, how much of that product is built now?
50%, 70%?

David Abrams (44:40.650)
I probably say it's like 40%, honestly, and we're okay with that.
We look at it and we say the product that we have now is so much better than what it would have been because it would have been all over the place.
It would have been gigantic.
The product that we have now I think is great.
And I'm okay with thinking, you know what, maybe in another year we'll be able to add another big piece of it.
And maybe another year after that, where before my mindset was two months to build all this, right?
My mindset was so short term before.
We have to have everything now, whereas we can learn and adapt.
And maybe in a year, what I think the product would need may not need it anymore.
Now we're learning from customer feedback based on what the customers need versus based on what our grand vision is of just some Gigantic product.

Omer (45:26.180)
Yeah, yeah.
And I think it's because when you're, when you're sort of thinking about that product, there's a tendency to want to add a lot of features and when you start to think bigger, you start to think about, you know, how to make it scale and maybe support different languages and all of these kinds of things.
And, and your experience shows that probably whatever product that you're thinking about building the MVP is going to be a tiny fraction of that feature set.
And you can get to, you know, as you sort of said, 40% of, of where you want to get to and still build a business that's doing, you know, half a million dollars a year.
And with the pricing changes that you're talking about now, you know, I'm guessing a year from now, if we're talking, you're going to be pretty close to a seven figure business, if not beyond that.

David Abrams (46:24.700)
Yeah.
Our goal in the next 12 months would be 100k.
Mrr.

Omer (46:27.420)
Awesome.
That's awesome.
Yeah, awesome.
I love those lessons.
It's just, you know, I think there are a lot of other things that we could talk about, but we're kind of out of time, so I'm going to move on to the lightning round.
Should I ask you seven questions?
Just try to answer them as quickly as you can.

David Abrams (46:45.940)
Sure.

Omer (46:46.420)
Let's go.
All right.
What's the best piece of business advice that you've ever received?

David Abrams (46:54.180)
Said it before.
Fail fast.

Omer (46:56.180)
What book would you recommend to our audience and why?

David Abrams (46:59.860)
7 Habits of Highly Effective People by Covey.
Great book.

Omer (47:04.180)
What's one attribute or characteristic in your mind of a successful entrepreneur?

David Abrams (47:09.310)
Great.

Omer (47:10.750)
What's your favorite personal productivity tool or habit?

David Abrams (47:15.150)
Reading in the morning before I get on the computer.

Omer (47:18.670)
What's a new or crazy business idea you'd love to pursue if you had the extra time?

David Abrams (47:23.710)
Augmented reality.

Omer (47:26.350)
What's an interesting or fun fact about you that most people don't know?

David Abrams (47:30.750)
I was adopted and I'm Salvadorian, but I grew up in the United States.
Cool.

Omer (47:36.100)
And finally, what is one of your most important passions outside of your work?

David Abrams (47:40.900)
I'll give you two.
Wine and basketball.
Not together.

Omer (47:44.180)
What a combination.
Awesome.
David, it's been a pleasure.
Thanks for joining me today and for just being so transparent and sharing the story of your journey and the lessons and the mistakes that you guys made along the way.
I think there's just so many nuggets of, of sort of wisdom that you shared here that I think will be useful to so many people.
And, you know, I kind of wish you guys the best and would love to get you back sometime.
And you know, when you when you had 100, 100,000 MRR would maybe would be a great time to do that.

David Abrams (48:24.790)
Definitely.

Omer (48:25.870)
Now if people want to go and check out demeo, they can go to Demio, that's D E M I O.
And if they want to get in touch with you, what's the best way for them to do that?

David Abrams (48:36.600)
Yeah, you guys can grab us on live chat.
We're always in the live chat.
We love talking with our customers on the website.
Or you can email us@marketingemio.com and we're always available.
We love chatting with people and just talking about the product and reach out if you have any questions.
And I just want to say thank you for having us on the call.

Omer (48:52.120)
It was great.
Awesome.
I loved it.
Thanks, man.

David Abrams (48:54.920)
All right, have a great day.

Omer (48:56.040)
Cheers.