What's up, everybody? This is Cortland from IndieHackers.com, and you're listening to
the IndieHackers podcast. On this show, I talked to the founders of profitable internet
businesses, and I'm trying to get a sense of what it's like to be in their shoes. How
do they get to where they are today? How do they make decisions, whether they're companies
and in their personal lives, and what exactly makes their businesses tick? The goal here,
as always, is so that the rest of us can learn from their examples and go on to build our
own profitable internet businesses. Today, I am talking to Sarah Hum. Sarah, welcome
to the IndieHackers podcast.
Hey, Cortland. Thanks for having me.
Thanks for coming on. You are the founder of a company called Canny. I've been seeing
Canny everywhere recently. Why don't you tell us a little bit about what it is and why people
use it?
Yeah, Canny is a user feedback tool. We primarily sell to other software businesses, primarily
B2B, and we help them keep track of their feedback. A lot of times, people grow into
this problem, but they might be using a spreadsheet or Slack even to keep track of feedback, like
just one off on a one off basis. And eventually they feel the pain of, hey, our feedback's
all over the place. Where can we put it all so we can actually use it? Because customers
are often saying things that they do need or feel a pain with when they use the product.
And so we think feedback is super important.
So if I wanted to get feedback from users on IndieHackers, and I wanted to use Canny,
what would that look like exactly?
Yeah, so usually what people do is they'll install some kind of feedback link into the
product. So for example, I can go to my profile. That's maybe where I would go look for it
and look for feedback. Once I click on it, it goes to their Canny site. So you could
have it like an IndieHackers.Canny site. And that's, yeah, it's just a persistent place
for people to get feedback whenever they have it.
As opposed to like a one off survey here, please give us feedback on XYZ. It's more
of a persistent, yeah, in-product product.
Cool. So I mentioned I've been seeing Canny everywhere. That's because your product is
kind of public. I'll go to another product that I use. And if I want to leave feedback
on them, I see their Canny board. I see all the features they're working on and the things
that they're upvoting. I see the things that their teams prioritize and what they say they're
going to work on now or what's on hold.
What's cool about this business is that you bootstrapped your way here. How much revenue
are you generating? And how big is your team?
Yeah, so we just crossed over 50K MRR. And we just had one of our best months, I think,
so far. So it's just really exciting. And we're a team of five.
Cool. Congratulations. Are you profitable on 50K a month with a team of five?
Yeah, yeah. We're super proud of it. We pay our team with the money we make, which feels
really, really good. Yeah, and we're not at risk of dying at any second, which feels really
good.
Yeah, that's got to be relieving when your company can't just end.
Yeah, for sure. For sure.
Another thing I like about what you're up to is you are a digital nomad of sorts. You're
traveling all around the world while you're building Canny. I'm kind of thinking about
doing this maybe next year when my lease is up in my apartment. I've been living in San
Francisco for nine years. It'd be nice to have some variety. I've looked at some different
cities, but it's kind of... I don't know. It's kind of stressful just thinking about
trying to run a company while also traveling all over the world.
Yeah. Honestly, we were in the same place. Andrew, my co-founder, and I both lived in
San Francisco for several years before we left. When I quit my full-time job, I was
like, we're living in one of the most expensive cities in the world. And we have a company,
but it's not making much money right now. Let's just get out of here and travel and
do the whole thing. And that was easy when we were a team of two. We were always there
with each other. We could always bounce ideas off each other. It wasn't a problem. But definitely
as your company grows, it becomes harder, but I wouldn't say it's impossible. And I'm
really glad we did it.
So you and your co-founder are a couple. You're actually dating and running this company together
and traveling the world together.
That's like triple hard because some people have trouble just traveling together. Some
people have trouble just being together, let alone working together too. How do you make
it work with somebody you're so close to?
Yeah, honestly, I think that's why it works almost. I think if I was in a relationship
with someone I wasn't working with, there are so many ups and downs when you're a founder.
There's so many things that just throw you off. But with Andrew and I, we always know
what is going on with the other person because we're in it together. So that's great. We're
great at conflict resolution because couples fight and that's just a thing. We've learned
how to fight. I think it works really well.
Yeah, it's kind of cool to have somebody who understands the emotional turbulence of being
a founder. You don't have to come home from a long day at work and explain it to them
and say, here's what happened. And then they try to be empathetic, but they really don't
care because they've heard this story a thousand times. It's more so they're right there with
you.
I have a point about the fact that you guys are great at conflict resolution. I run Indie
Hackers with my brother. We've been arguing with each other since we were babies. Basically,
we have 30 years of conflict resolution. So it's like there's very few disagreements
are going to get in the way of our business.
Totally. And when I read even on Indie Hackers and on other like start-up communities, when
I see people kind of arguing over like equity splits and all that, I just feel like that's
not a great place to start a co-founding relationship. And so just the fact that we can be so open
with each other because we've been through it, that just adds a whole level of comfort.
Yeah.
So let's talk about how you two got started working on Canny. Or maybe even before that,
I know Canny is kind of your first business, but also kind of not your first business because
it existed as a different business beforehand. Why are you someone who wants to start companies
in the first place?
I started doing hackathons. And for some reason that just thrill of building something out
of nothing, hacking things together felt really good. And it felt like something I could excel
at personally. And I did try the whole big company thing. I worked at Facebook for about
a year and a half before leaving to do Canny. And yeah, I knew that I couldn't be at Facebook
for very long, I think. So it just felt right. I don't know.
Why not? Why couldn't you stay there working a cushy job?
Yeah. So I mean, at Facebook, I worked on Messenger as a product designer. I think it's
a great job, honestly. I did enjoy working there very much. It's just I felt limited
almost. My one job was to do product design. And that was nice, but I wanted to do so much
more and I wanted to learn so much more. And since I started Canny, I have learned so much
more.
Product design is probably 20% of my time now, maybe even less. But I just learned so
much about marketing and pricing and sales and everything. So it's just very fulfilling
to me starting a company.
Do you think working at Facebook as a product designer gave you the skills that you needed
to be a founder that was a good stepping stone? Or do you think in hindsight, it's something
that you could have just skipped?
Yeah, I think for me personally, it was an important starting point. I came from a small
Canadian design program. I really had no entry into tech almost. And so having that Facebook
background just helped me understand tech in general and also meet a lot of really cool
people. And that's where I met Andrew. I probably wouldn't have met Andrew if I didn't work
at Facebook. So that was very, very important.
And also we're bootstrapped. So having that saving was very helpful in our early days.
But I would say that working at Facebook did not prepare me to be a founder.
Yeah, so you like working there, but it's not exactly the best place to learn how to
do your own thing.
Yeah. I think it's the one role type thing issue. I was a product designer there. There
was no... There's no startup training. You don't deal with all the problems that a startup
goes through. Facebook is such an established company. We are abstracted away from everything
that is difficult, legal, all this stuff. We don't touch that at all. And it's something
that we've had to learn with Kani. But I'm really glad that we have.
Tell me about your very first product. It was called Product Paints. And it eventually
ended up sort of morphing into Kani. You can't really say it's a different business, but
it had a different name. It worked differently. Why did you start it?
Yeah. So Andrew and I had always been hacking on things together. We've done a couple of
other projects before, Kani, just like really small side projects that I really went anywhere.
But in my last year of school, I had the opportunity to do an independent study, which meant I
could do whatever I wanted. So I kind of started a company and got credit for it, which is
awesome.
But we started Product Paints, which was a community for anyone to give feedback about
anything. So you can think like Yelp, Uber, stuff like that. Very consumer focused at
the beginning. We grew the community to almost 5,000 people, just people giving feedback
about things, which is pretty amazing. But over time we knew that we had to make money
and we saw the potential of Product Paints was not where we wanted it to be. And it eventually
morphed into Kani, which is great because we reuse a lot of the code. Like it was mostly
a rebrand almost. And so we repositioned it, rewrote everything so that it was targeting
B2B companies and we launched it as Kani. And so it was almost like an early, early
version of Kani.
You said you were hacking away at a bunch of different things. You tried lots of different
ideas, but you never really went hard on any of them except for Product Paints. What made
Product Paints stand out to you as an idea that had legs?
Yeah, I think it was very exciting to build a community. I think it was really exciting
to see people give feedback about certain things. And also the chance that we could
change products, like we could give Yelp feedback and they would change something was very exciting.
In hindsight, I think it was not super realistic because we were so small and it would take
a lot of people, I think, to really make an impact maybe. So instead of going after users
first, we basically flipped it so that we went after the company first. And so the company
says, hey, users, we are collecting feedback using Kani. Here's where you should give us
feedback, which worked out a lot better and it enabled us to make money. So that was great.
It's cool to hear you talking about the fact that you were motivated by what was exciting.
You thought it was exciting to start a community. You thought it was exciting to have an impact.
You thought it was exciting to help change products. How much of your thinking about
ideas back then was related to just what you were excited to work on versus what you thought
would be a viable business.
Yeah, I think honestly, because it was a school project almost, my mind wasn't, how am I going
to turn this into a business? It was really like, what do we think is cool? And what can
we build a cool scrappy product out of? And so that's what it became. And honestly, the
name even speaks for itself. It was so like, oh, last minute here, this domain is available.
Let's just call it product pains, which sounds horrible when I say it now. But yeah, it was
really like the fact that I think we've built a successful business out of it says a lot
because it was something that really was just exciting to us. But I think that says a lot
too. It helps us stay motivated today, because we still are trying to achieve the same mission,
still trying to change products, still trying to help teams improve. So yeah, still drives
us today.
How do you as someone who's never started a company before, who's never built and committed
to a project before grow a community from nothing into 5000 members?
Yeah, honestly, Facebook comes in again here, like Andrew used to work on the react team
at Facebook. And soon after he left his team, one of his teammates, I guess was like, what
are you doing? And he was like, I'm building this thing called product pains. They're like,
what's that? And then they started using it for react native, which is a huge project
now. And they started using product pains to collect feedback from other developers.
And that just spread because developers usually work at some company. And so when that kind
of just spread naturally, other companies would kind of hop in and join. And that's
still a pretty strong mechanic for us today.
Yeah, word of mouth growth is pretty, it's pretty magical when it actually happens. And
it's, it's, it's hard for me to imagine being in your shoes as someone who quit Facebook.
And you're working on this product. At this point, you do want it to be a business because
you quit your job and you're burning through your savings. And it's growing through word
of mouth and people are using it. It's hard for me to imagine being in a situation to
deciding, you know what, we need to shift gears and take a different approach. Why did
you decide to stop working on product pains?
Yeah, so I mean, like, I wouldn't even say we really stopped working on it. We just,
it was really a rebrand repositioned it. Eventually, we had a few companies join product pains
and they were like, Hey, do you have a widget for us to put on our websites? And we're like,
no, but if we built it, would you pay for it? And they basically said, yeah. And so
we built it. They paid us $19 a month to put a product pains widget on their site. So basically
users could give feedback directly from their site. And yeah, they paid for it. And that
was, I guess, really amazing for us. And that just got us to start thinking about, Hey,
maybe we should switch this up and come from a different angle and sell towards sell to
the company themselves instead of trying to get the users in first. So that just kind
of naturally happened.
How long were you working on product pains before that happened? And were you making
any revenue at all? Or is that your very first dollar from a customer?
Yeah, the $19 was probably the first money we ever made. We had just been purely making
a consumer platform at that point. And so yeah, the $19 was the first real money that
we made. And I don't know, it's kind of complicated how long I've been working on it. I think
like when I started in school, I worked on it for maybe six months. And then I graduated,
went to work at Facebook. So product pains kind of just died down a little bit. Andrew
quit. He worked on it. And then I quit and I joined him. And then it became Kenny. So
that's the whole, that's kind of the whole ups and downs of product pains to Kenny.
Did you have like a long period of basically burning through your savings after you quit
Facebook? Or was it pretty quick that you decided that it needed to switch over to Kenny?
Because I know that can be pretty stressful when you quit your full-time job to think
about how long it's going to take before this product makes money.
Absolutely. I mean, when I, yeah, when I quit, it was still product pains. I think by then
we had made the $19. So that was in the bag. But I think in the next, it was over the winter
break. So nothing really happened there, but we launched it in March. So about three months
after I quit, we had it all rebranded and repositioned as Kenny. And as I mentioned
before, we reused a lot of the same code as we had in product pains. So that made it a
lot, a lot faster. But yeah, it was just one random day in March. We were like, why are
we waiting to launch this thing? Let's just put it out and see if you will like it. And
they did.
So let's talk about your mindset going into this, this rebrand because this is you really
thinking about product pains in a way that you hadn't before. Earlier, it was what would
I be excited to work on? Now it's like, hey, I've quit my job. This is a business needs
to make money. I've got to think strategically, this widget thing seems to work. What else
but into your decision making there for deciding to rebrand it and deciding that that's what
the business should be?
Yeah, I mean, I think we had, we knew that the business we wanted to build would be bootstrapped.
And therefore it had to make money. There's no question about it. Like we would need money
to pay ourselves eventually, we would need money to hire people. So we knew we had to
make money. And so a big part of switching product pains to candy was adding a pricing
page. That was just step number one, like we had to make money. We've never even to
this day had a completely free plan. We have a free trial, but that's about it. Yeah, that
was, that was a big change.
So living in the Bay Area, and deciding at the same time that like you want to bootstrap
a business is not that common of a decision. I know a lot of founders in the Bay Area,
usually the first thing people think of is I need to raise money from investors and then
I don't have to worry about making money for several years. What was influential to you
guys and deciding that you wanted to bootstrap?
Yeah, I mean, I think so I think me and Andrew were on the same page here as well. But we
didn't like the idea of not owning what we were making. I don't know. We being in the
Bay Area, we've heard, you know, the stories about, you know, like bad investors and just
what it's like to have investment. Like when somebody else is an owner in your company,
they have a say in what you do. And that was scary to us and not very attractive. So yeah,
that's not the road that we took. And we thought like, Hey, we're going to try this thing.
And if it makes money, like great. And if not, then we'll try something else. It's not
a big deal. Like we're product people, we can build things. That's what we're good at.
We didn't feel like it was the biggest risk ever. I mean, it is, but it also wasn't like
it just happened to work out in our first try, which is great. But yeah, we knew from
the beginning that we didn't want to raise anything.
There's another company. I don't know if you have you ever heard of get satisfaction?
Yes.
So they were around when I first came to the Bay Area around 2009, 2010. And they raised
a ton of money doing something that kind of was similar to product pains. They're like
a Yelp for customer service and user feedback. They have a lot of drama because they would
set up these pages that looked like they were official. So it'd be like, Oh, this is the
like, you know, the ND hackers community service website. It's like, no, it's not. This is
the get satisfaction page. So a lot of founders would get mad at them. But they raised something
like 10 or $20 million, which instantly is a huge promise to investors that you're going
to build like this massive company. And then I think they just kind of cratered over time.
So you know, besides just investors having control over your company, I think one of
the scary things is if you're not building a business that can get as big as investors
would need it to be to succeed, then you're just sort of signing yourself up for a world
full of pain.
Absolutely. I heard about that drama, actually, because I think we were starting Canon like
just about around the same time. And yeah, that's just it just didn't sound fun. Like
we're already like trying to build a product like it's already going to be hard. Like why
make it harder by throwing in another voice who we don't know who we might not be able
to trust. Like it doesn't seem like our thing. So yeah, we've never felt the need to do that.
So up until this point, you hadn't really found product market fit yet. You had worked
on product pains. That was okay. You pivoted into this widget that customers would actually
pay you for. But it wasn't like you were selling tons of subscriptions. A few months go by
and then you launched. Tell me about your launch and how that went.
Yeah, it was great. Honestly, like it was an exceeded expectations. There were a lot
of we had a lot of signups. We went and launched through product hunt, which was I would say
product time was at its peak around then. And like there were a lot of people chiming
in and like supporting us. So yeah, it was really it was really great. And we still have
some customers from that day two and a half years ago. So yeah, I don't know. I don't
think it could have gone any better. Really.
You have a post on your ND hackers product page from October 1st, 2017. It says you reached
ramen profitability. And I think you had just launched in what March of that year. Yeah.
So what is that seven months from launch to ramen profitability? That's pretty fast.
I don't know. Maybe it is. Yeah, that was just what we felt at the time. And that post
actually hit Hacker News, which was big for us. It was probably one of our first posts
that hit Hacker News. And so we got a bunch of traffic that day. But yeah, we just like
sharing stories and sharing our journey. And I think that post came off as very authentic
and very interesting to a lot of aspiring entrepreneurs. So yeah, I mean, that was an
exciting time. And we felt like we had something.
So at some point during all this is when you just took off and became a digital nomad.
Yeah, I would say probably May or June. So a couple months after launch.
Okay, so right after you launched, tell me about how you made that decision.
Honestly, it was such a last minute decision. I think it was the week before we were talking
about it. And the next day after we started talking about it, we told our roommates, we
think we're gonna leave. We're gonna have to find someone else to fill our room. And
they were shocked, but I think excited for us. And so yeah, we took off and did a little
tour of the United States first, just to say hi and bye to friends. But then from there,
we hit up London, which was an easy ease into the whole digital nomad life. I think all
English all like very similar culture, I'd say ish. But from there, I think we hit up
like 26 cities in about two years. So yeah, it's been it's been fun.
How do you how do you manage to get to profitability while also traveling to 26 cities? Because
it doesn't sound cheap to travel that much in two years.
Honestly, I tell people that I save money because my rent in San Francisco, I'm sure
you're familiar was not great, even though I had several roommates. So when you're in
Thailand, your rent is next to nothing compared to that. So yeah, you are paying more for
getting around for your flights and your buses and whatnot. But honestly, compared to San
Francisco, I think I saved money. I did.
Yeah, it's actually not that hard to save money compared to SF rent, right? No matter
where you're traveling, it's usually cheaper, especially if you're hitting up like these
sort of digital nomad hotspots, which are known to be pretty affordable, Bali, Thailand,
South Africa is another cheap one that not a lot of people go to you, but it's super
affordable there.
Yes, yes, we've always had our eye on South Africa, but we never made it out there either.
We did the Southeast Asia little round trip, but that part was tough. It was when we have
customers that, you know, demand our attention almost every half hour, like it's it's not
easy, but trade offs, right? Like we want us to travel and we wanted to see Asia. So
we had to do like 1am meetings, like it's okay.
Yeah, give me a sense of what your day to day was like when you're traveling and working
on candy in the early days as a co founder couple.
We tried to stay in each city for about a month. We felt like we had a chance to like
settle down a little bit before we were on the move again, because travel days are the
toughest. You almost get guaranteed you won't get any work done that day. But yeah, we tried
to stay in the city for about a month. So that enabled us to get a feel for the city
and understand where we would work and where we would eat and all that stuff. So a lot
of it was working out of cafes, which I love because you also get to see the city and experience
it as a local would as opposed to like going all going to the tourist hotspots and all
that. So yeah, we spent a lot of time going from cafe to cafe and just and you know, exploring
the city on the weekends. But yeah, it was totally doable. And I would recommend it to
anyone traveled all over the world. What was your favorite place? Yeah, I always say in
Europe, it was Valencia in Spain, which is just south of Barcelona. And we just we just
had a really cool community there. There were a bunch of other remote workers and really
friendly cafes. So that was that was a really big highlight for us. And in Asia, we would
say Seoul, Korea, there's so much stuff in the coffees really good. There's very, very
fast Wi Fi unbeatable pretty much. But we really enjoyed that Korea as well. Yeah, founder
and your traveling Wi Fi is crucial. You got to get work. Exactly. We always did our research
on Nomad list, like, who has good Wi Fi? Where can we have reliable cafes to work at? It
was a thing. But honestly, they're like people are pretty well connected. Now, like, we almost
never went offline. So while you're doing all this traveling, you had just launched on product
hunt a few months before that. Generally speaking, there's this kind of trough of sorrow period
after you launch, where you're super excited, your launch date goes well, there's tons of
people in the door. And then after that, obviously, your launch is over, and it drops back down.
And now you have to figure out how you're going to grow and how you're going to find
customers in the future. What was your strategy in those first few months? And how did you
grow from from basically zero dollars in revenue to ramen profitability?
We tried to write, even though we are very product minded, the two of us had to say,
hey, we're going to spend this amount of time every week to write something. And that was
hard for us because yeah, we just kind of naturally gravitate towards building cool
things and writing was not that. So that felt weird. But it was very impactful for us. Like
we we wrote several blog posts. And a lot of them were just us telling our stories like
I wrote a post about pricing, which is this whole thing. And we build a community people
start hearing about us again, the word of mouth helped a lot. So it just naturally kind
of crept up and it's been going ever since honestly. Yeah, we today we still try to write
a lot. We're trying to do less of the one hits, like we post it on Hacker News. If it
doesn't work, we try again, that kind of strategy to more of an evergreen SEO focus strategy,
which is working well for us too. And so yeah, just I think it's just kind of you take it
as it comes and try things and make sure you can tell if something's not working and then
yeah, you keep pushing. And I think it helped to not charge or to always charge money. Always
because everyone who is a potential support ticket like should be paying money. Yeah,
it's just your time is your time is the most valuable thing. So yeah, a combination of
blogging. Yeah, product was never free. So 100% of the customers coming in the door contributing
to your revenue growth. So you're getting there. Let's say I'm a brand new founder,
I go through the same process I launched, it goes, okay, what are your tips for me and
how I should set up my blog and my writing strategy because it's it's not always obvious
how to write successfully. Yeah, so our most successful blog posts from
the beginning were very much here's what we did. And here's what we learned from it. It
was very much almost like a recounting of the certain things we tried. So for pricing,
for example, I wrote about four different pricing strategies that we tried. And the
good and bad things about each and why one thing was working and why other things weren't.
And people really liked it. I think like pricing, especially as one of those things where you
can't say this is your price, this will always work like there's no formula really. So I
think just hearing our story and how we thought through pricing really helped other founders.
And so if you're an entrepreneur and you try a certain thing that is different and interesting
in a certain way, like write about it. And the nice thing is that you're just telling
people what happened, like you're not kind of creating content out of nothing. It's like
something you did. So it should be really, really easy to write about. So I definitely
recommend doing that and just sharing, sharing the knowledge, sharing the love.
Yeah, that's the whole strategy behind Andy hackers is content, exactly people sharing
their stories. And the thing is, you don't have to be an expert on any particular subject
matter, because you're already an expert on your own story. So all you really have to
do is share that. And if you learn something, chances are other people will probably learn
something from reading about your experiences.
Exactly. And nobody can tell you your story is wrong, or you experienced something bad.
Like, this is what we did. Like, you can't really argue this is take it or leave it.
If it helps, great. If it doesn't, we'll try again next time.
Is there anything from your blogging experiences with the benefit of hindsight that you would
have done differently if you could go back and start all over again?
Yeah, I think all all we would do differently is do it more. Like, we always gravitate towards
product. Like I said, like, we would always be like drifting back to product, even though
we didn't have to, we would just want to build the next cool feature. And when you're so
resource limited, like, it's really important that you focus on the right things. And I
think we could have focused a lot more on writing. But that's okay. Like we are, we're
not lost. We are continuing to write today. And so yeah, we just take it from here. And
I hope, you know, me saying that now will help other founders do that earlier.
Yeah, I know you're still working on it too. Because I was I was Googling you Sarah, and
I found you have an account on 200 words a day. Oh, yeah. You have you've got a quite
an impressive streak going on. You write every single day.
Thank you. Thank you. Oh my god, somebody noticed. That's that's really awesome. Yeah.
I write 200 words a day. It was purely for me to get in the habit of writing in the habit
of ideating different blog posts that I should write. So what I usually do is write 200 words
of a blog post a day. So by the end of a week, I usually have about a full blog post. And
it doesn't feel like like the barrier to entry the wall is not as high because I only have
to do 200 words. That has been helping me a lot. The streak, of course, I don't want
to break it. I think I'm almost at 200 days in a row or something like that. But yeah,
it's just it's very motivating. I think it's business impactful. So both good things.
Is there anything else you do every single day as a founder? Because I try to have these
habits where I'm like, Okay, this is so good to do. I should do it every day. But I can
never sustain more than just like one or two things like that.
Yeah, it's definitely hard. I think I just tried to cut off at the end of the day. Like
I just like my brain is fried. I'm done. I make time for myself and my brain to watch
Netflix or do my drawing or whatever. So that I am refreshed and ready for the next day.
Like I think that it's not really doing anything. It's almost like doing nothing. But it's it's
definitely important, I think. And I think that especially for early founders, like they
think that they must spend all of their waking hours on their product. But I think there's
something to be said about detaching and kind of replenishing all those, you know, brain
juices for the next day.
I just talked to Patrick Campbell, he's the CEO of ProfitWell on the podcast. And he was
talking about how there are three different levers you can sort of pull on to grow your
business. So one of them is user acquisition, getting new people in the door that you blogging
that's creating a really good product that spreads through word of mouth. Another one
is monetization, which is everything to do with pricing. How much do you charge? What
are your plans look like? How do you upgrade people? How many will convert to a paid plan?
How often do you charge them? All that kind of stuff that can raise your revenue significantly
if you make the right decisions or really hinder you if you don't. And the last one
is retention, which is just like how long do these people stick around? If they leave,
it doesn't really matter how much are charging them. You're not gonna make that much money.
Let's talk about monetization, because you've brought up the fact that you've written a
couple blog posts on pricing strategies that you've tried. What have you learned about
pricing and the course of running Kani?
Yeah. So as I mentioned, we haven't tried freemium, which is like the big, you know,
should we or should we not in startups, I think, or SaaS, especially anyway. But yeah,
so at the beginning, we had a $2 plan. That was our lowest plan ever.
$2 a month?
Yes, $2 a month. And it was basically three. Yeah, we were referring it to it. We were
referring to it as GPM instead of freemium. It's just so we thought we could get the easy
bit of, you know, signal that somebody thought it was valuable. So they might as well at
least pay $2, right?
Yeah.
What ended up happening was that people were just like, we had to chase people for like
$2 a month, which is not a good use of time. And it just, it just didn't work. Now, we're
actually talking about doing freemium again. We always talk about it, I feel like, but
we feel like it might be a good time to try it out. I think pricing is never a set it
and forget it thing. It's, you will be iterating on it. Like your product is getting more and
more valuable. You should be able to charge more and more for it. And so we are hoping
to charge more because we have built so many things in the last year that we feel like
are valuable and should be paid for. But also I think adding that freemium level on top
might help just acquisition and boost word of mouth even more. So yeah, it's, it's,
I have no answers, but that's what we're trying.
Yeah, the thing about charging $2 a month is that you really can't afford to do very
much for any customers who are only paying $2 a month. I mean, like, can you afford to
talk to them over email? I don't know. Is it worth, is it worth your time?
Probably not.
No.
You can't do sales.
I will tell you now.
You can't do ads.
Yeah, no, it's, it's not. So we tried it. And it's a cool story, but we probably won't
ever do that again.
One thing I think that makes that story more common than it should be is that as an early
stage founder, you're looking out and you're thinking, well, my product is going to get
more valuable over time. And it will be worth a lot someday. But right now, it's just me
and maybe my co founder are working on this really tiny thing. Why would anyone ever pay
$50, $100, $300 a month for this thing? Did you feel like that in the early days of canning?
Yeah. And I think I read the advice, you know, I read that product people are notorious for
like valuing their product too low. And so by reading that, I was like, maybe I can bump
it a little higher and not feel like horrible about it. But I think over time, like we just
we tried to push things a little more. So we would set it maybe a little higher than
we felt comfortable with. And then we would wait and see what people say, you know, people
say, Oh, this is this is insane, or whatever. Like, okay, that's that's a data point. Oh,
like, this is this is totally reasonable. That's another data point. So pricing is this
very flexible thing. Like, don't don't worry, like you can change it. Like, yeah, it will
take work to like grandfather people. And it's a whole thing. But it's a huge part of
your business and it could drive it much, much higher. So I would say it's a risk worth
taking.
What kind of pricing plans did you end up on after all the experimentation that you've
done so far?
Yeah, so our current pricing starts at $50 a month. So we think, you know, startups around
10 to 50 ish people teams, and then we have a $200 price point for teams bigger than that.
And then we have a custom bucket for anybody who may surpass all of those features that
we have available. But at the same time, we also have a value metric, which Patrick can
tell you a lot about as well. Yeah, that scales based on the amount or the number of people
that give you feedback. So we get a significant amount of growth from upgrades every month,
which feels great. And it's been working really, really well for about a year. So I think it
is time for us to try to switch up our pricing again. But it's definitely something that
we felt has worked in the past. And so we'll definitely use it to inform our future pricing.
It's interesting because your pricing is so connected to every other part of your business.
For example, what types of customers are you even dealing with? If you're dealing with
really big companies, you're gonna have to have like that huge custom plan and a lot
of infrastructure built out for that. If you're dealing with really small customers, maybe
your value metric, you know, cut offs have to be lower, you have to say, okay, well,
you know, once you get to buy people giving you feedback, you pay us more because you're
a tiny team, you're not gonna have very many people. How did these realizations affect
your pricing? And what are some things you've learned about your customers since you've
launched? Yeah, I think so from the beginning, we were trying to charge based on people.
I think that was what we thought showed what kind of business you are, how successful issue
you are and how much you might be willing to pay. So that's the metric that we landed
on. People giving feedback or people working at the company who could log into Canvas?
People giving feedback. So your user base, basically. At the beginning, we said, oh,
like, if you have this many total users, you're in this bucket. But honestly, there was no
way we can know how many users you have. So people were just really self-bucketing themselves,
which was surprising. But honestly, you could have been like, you could have had a million
customers and signed up for a small startup plan. It's a bunch of trial and error. Sometimes
people just sign up for the bucket that they feel like they're suited for. And so you learn
and you see what people say about your different plans. And the reason why we've stayed on
our current plan for so long is because we've gotten good feedback about it and people think
it's reasonable. So yeah, I think now is the time to make that change.
But also at the very beginning, we were trying to target almost everyone. We were trying
to make pricing that qualified for consumer companies and the solopreneur and the big
B2B business.
Yeah, be everything to everybody.
Yes, exactly. And I think that's just the mistake that everyone has to make to feel
the pain of it is just you try to serve everyone and then you serve everyone really badly. And
so we eventually started narrowing down our target audience and started figuring out really
who is going to pay for this, who really wants this, who is going to find value out of this.
And then with that, we were able to make our pricing more targeted and make more sense
for the people that we actually wanted as customers.
How do you do that? You have so many people using your app. You have people who you don't
want to cut off because they're paying you money and they're saying good things about
your product. How do you, I guess strategically even figure out which type of persona is the
best for using your business and also emotionally, how do you feel good cutting other people
off and not serving their interest?
Yeah, I mean, like, don't get me wrong, there are still those people who will sign up and
pay and that's totally fine. But like our marketing and like our pricing pages, they're
not written for those people. They will get through and that's okay. I'm not going to
turn them away, but I think you pay attention to your data that you have. We just saw the
usage of certain kind of companies was stronger than others. People like just expressed more
value. People that were B2B businesses for us expressed that they got more value out
of CanE. I think that's just like due to talking to customers. We have live chat on our site.
It's really simple. Just listening to people, you know what they were saying. So eventually
we just started like shaping this kind of vision of what our customer looks like in
our heads. And yeah, it doesn't feel great to cut people off, but I think that's how
you build a strong business because when you're building a product and you're considering
like a bajillion different features, you want to make sure that the features you're seriously
considering are for those people specifically, your target people, because our product today
could be 10 times bigger, but not useful for our target if we weren't paying attention
to that.
So this is the perfect segue into CanE itself. Paying attention to what your users want,
what kind of features they need. Do you use CanE and sort of a dog food, your own product
sort of way to figure out what people want from CanE?
Yes, absolutely. When people ask that, do you have a CanE for CanE? Like, yes, of course.
Here's where it is. Like it's the fact that we can dog food our own product is super helpful.
It's we know that a feature we're considering will be useful to us. And that's a good gut
to say that, oh, this will be useful to our customer base. And we can feel the pains of
our own product. We can feel what the product needs. We feel everything. So that's been
really nice. And when we can use our own product for something, we're really excited. Just
put that on CanE or just check out the CanE port or whatever, you know, like it feels
really good.
Yeah, I use IndieHackers sometimes to ask for business advice. And that's the entire
purpose of IndieHackers. So it's like, ah, it's perfect. I feel like I'm my own user.
Not every business can do that. A lot of people are making products for people who aren't
them, which makes it that much more challenging to sort of figure out what you need to add.
Yeah, it's harder to empathize. You don't, you don't, you're not trying to solve the
same problem. Like for us, we're trying to build a better product. That's what CanE tries
to help you do. So if CanE does that for us, it must be doing that for other people. At
least that's, that's what makes sense. Yeah.
So even when you have a list of feature suggestions from customers, a list of problems and bugs
that running into and things that they want, it's still not necessarily easy to figure
out what you're going to build. Because customers have a very different perspective than you
do as a founder. You're trying to think strategically, at least to some degree, like what's going
to make us bigger and better and help us out. And customers are just like, what's going
to make the product itself more comfortable for me to use? And like, they're usually requesting
these small incremental changes. How do you think about which features to prioritize at
CanE? Do you have sort of like a framework in your head of what you should build at any
given time?
Yeah. I mean, so like, if this was easy, like product managers wouldn't be a thing. Like
it would be, it would be crazy.
Yeah. Just give me the product manager checklist so we can fire all the product managers.
Yeah. Right. So what we do usually is we usually like at a given quarter or given month or
whatever, we have some kind of a target goal for this month. We were looking at increasing
trial to paid. So the more people that get started trial, we want a bigger percentage
of them to end up paying. And so we kind of consider features that would impact that goal.
So a lot of it was to do with onboarding and even like our drip campaign and stuff like
that. So we definitely like put a list together of different projects that we feel like would
impact that goal and kind of rank them by effort versus impact and all that good stuff.
And if it's in CanE, that's a big bonus. Like we get to go in there and say, here's what
different people are saying about the issue or maybe they have some insight into something
that we're not currently doing or that we're doing wrong or whatever. And it's also a place
where we can go and say, hey, this is what we're thinking about for XYZ. What do you
think? So CanE is a place for you to get insights out of. We're not going to give you the answers.
We're not going to tell you, hey, this is what you should prioritize this month. But
it's there when we need it to inform the decisions that we make.
What are your thoughts on getting feedback from potential customers before you reach
product market fit? And after? Are you asking the same kinds of questions? Do you want the
same kinds of feedback? Do you prioritize user feedback the same way now as you did
back when you were just trying to figure out what kind of product to work on?
I think the day after we found a decent fit, it's more how do we make the product better
for our target audience because we figured out who that is. And in the beginning, it's
a little more scrambled. It's like a lot more guessing because you probably don't have enough
data yet. Like we tried doing A-B tests at the very beginning and like there just wasn't
enough people. So there's no point in doing this. Yeah, I think it does change a little
bit, but ultimately you're trying to build a product for a specific type of person. And
so that didn't change. But I think yeah, the audience changed.
So you've mentioned your pricing right now is minimum plan is 50 bucks a month. That's
what 25 times higher than your old minimum plan. Now you're considering a move to freemium.
So people would be able to sign up for candy free, try it out and then they'd eventually
I guess upgrade. Why consider that? Why even go back to the drawing board with your pricing?
Yeah, I think we've always like, at the since beginning, we've always wanted to serve small
companies like we're one of them, we want to help them. And our pricing today blocks
a lot of them. And so I think that's just one of like the feel good reasons for us to
do freemium. But I also think that like Patrick says, like it's an acquisition strategy, it's
we get more people more eyeballs on the product, we get more people trying it out. And hopefully
we get really good at convincing them to upgrade. But yeah, like on like our, our word of mouth
public product helps generate revenue a lot. And if we can have more people using the product
in general, I think it'll definitely help.
Let's talk about competition for a little bit. Because I think this is a pretty big
factor in why a lot of early stage founders either don't decide to work on a particular
idea because they see a competitor is already doing and I'm too late, someone already took
my idea, or why they charge very little, which we already talked about. How do you think
about the competition for canny? Because you're not the first company to exist to allow companies
to collect feedback from their yeah.
So I mean, in the early days, we, since we were building product pains and weren't really
paying attention to anything, which is probably not good advice, we didn't really we weren't
really paying attention to like user voice, which was the big player, and maybe is still
the big player. So we kind of just built what we, what we thought was good and what we thought
was helpful, which I'm kind of grateful for now that I think about it. But on the flip
side, I think there, there've been a lot of similar products popping up recently, that
people compared to us. And honestly, I think competition is a good thing in general, but
it's definitely like a, you know, a thorn in our side almost, it's hard. But I think
we are confident that we are good product builders, and we can kind of stay ahead of
the curve, instead of like following the footsteps of someone else. So yeah, we're we are aware
of them, but we don't let them get to us.
Yeah, I would, I would guess that your biggest competition is basically people using nothing.
Like if I start a company, my default decision is I'm going to put my email address on my
contact us page, people will send me emails with suggestions, and I'll just like kind
of reply. And that's my, that's my solution. How do you how do you convince someone who's
doing like that, you might not even be looking for something like candy, that they need a
tool to help them collect customer feedback.
Yeah, I would almost say that if if you don't have, well, first of all, if you don't customers,
like, like talking about target audience again, like, you're probably not there yet. And I'm
I'm totally fine with that. Like you, a lot of people start with spreadsheets, a lot of
people start with email address, like you mentioned. And that's okay, it's our job to
convince you at the time that you feel that start feeling the pain, that you move to a
more dedicated system. And so that's what we find with us. Spreadsheets are the enemy
to a lot of startups, and that's really fine. But we have an import tool like that's we
just help bridge the gap when you're ready. And yeah, that's just how we handle that.
It's it's it's not a concern for us.
Let's talk about hiring for a minute, Sarah, Kenny is now a five person company. It's no
longer just you and your husband, but you've also got three employees working under you.
How did you go about building up your team?
Yeah, I mean, it took a while like, it took us a while to make the amount of money that
we needed to start hiring. But we stuck it out like we, we saw it, you know, in the in
the distance, and we knew it was achievable. So we just waited, it was the two of us for
a while, we waited until we could afford someone. But the first person we hired was someone
for customer success. So they cover success and support, which was a huge weight lifted
off us. It was we do we now we now do not wake up to a huge queue of support emails
and live chats. So that's been really nice. But like, over time, we're just kind of thinking
about it, like, what is the biggest part of our brain that we dedicate to something that
might be a little less important than what I'm really good at? And how do we bring someone
on to fill that role? And so yeah, that's, that's kind of what we've done. When we feel
the need for someone, we put up a job listing and try to bring someone on. And that's another
reason why I think bootstrapping was a way to go for us was we didn't feel the pressure
to have to grow insanely fast. We're never like we must hire someone now. So yeah, we're
just we're taking it easy. We're thinking about it really hard before we make the decision
to do something. But yeah, we're at a we're at a nice family size now.
Hiring can be pretty nerve wracking, especially if you've never done it before, if you've
never interviewed someone before, if you've never managed somebody before, and also you're
going to do it remotely. So you don't even get this person like in person all the time.
What are some things you've learned about hiring and managing people that others might
want to know?
Yeah, I think so I haven't been a manager before. I have never been a manager before.
And that was, and still is probably one of the hardest parts of my job for me is just
understanding how to help people do the things that they are here to do and also that they're
happy doing it and they feel fulfilled. It's something that's on my mind constantly. But
I think the fact that I am pretty self aware helps a lot. Like I, I can tell when there's
something wrong about something when there's stuff I need to say, like I'm I don't hold
things in when I when I feel it's important to be said. So I feel like transparency is
number one, like just like be open with the people that you work with. Like you, you are
a family like you you see each other. Well, you don't see each other, really, but you're
you're working together for a lot of the day. And it's important for everyone to just trust
you and feel feel good about working together. I think that's that's one of the main things
that I'm trying to achieve. And we're trying to do that with our team off-sites as well.
So we try to see each other three to four times a year. We've done three team retreats
so far. So yeah, just keeping the relationship like really honest and open, I feel like is
what's working for me right now.
What are your goals with with hiring and bringing more people on and with Kenny in general?
Like what do you see this going in five or 10 years, five or 10? That's hard. You're
right. How about in one or two years? Yeah, yeah. Yeah, I think we want to I want to continue
growing our team very sustainably. Like when one person is onboarding, I want them to be
the focus on and make sure that they are comfortable and they feel good about the work that they'll
be doing here. I do want to grow up bigger. Like we have a lot of cool stuff that we want
to build. We have we have cool things that we want to do. So I definitely want to grow
a bigger product wise. I think I see Kenny working for bigger companies soon. From the
beginning, we've really built the product up to work for small, small meeting businesses.
And there are bigger businesses knocking at our door. So if we can serve them as well,
that would be great. I just continue to help teams make better decisions. I just feel like
people make decisions based on almost nothing. And if we can help inform them with what their
actual customers are saying, that's what Kenny is here for.
What kind of effect do you want your business to have on your life as a founder? Because
I know some people who are like, I never want to hire, then it gets real. Then I have to
be a manager. It's not just a fun thing for me anymore. I know some people who are like,
I want to hire hundreds of people and run a massive company because that's how I see
myself. How do you want to affect your life personally with Kenny?
Kenny has enabled me to travel for the last two years, which is super great. And I never
wanted to get to this place where I feel icky or something about going to work every day.
And I feel unfulfilled and we're doing the wrong thing. So I never want to get to that
point. But I think growing the hugest team isn't super interesting to me. I never want
to be so detached from the product that I don't even know what's going on.
So personally, I do want to keep it cute and small. But at the same time, really having
a big impact with just a small team. I think that's what I want.
And that's the power of internet-based businesses. You can have a giant impact with a really
tiny team. You can have a big impact by yourself, really.
So this show is listened to by a lot of people who are in a similar position to where you
were two and a half years ago, who are maybe just starting on things or considering getting
started. What would you say to somebody who's in that situation, Sarah? What would you want
them to know?
Yeah, I think if you're at a full-time job right now, and you're considering starting
a company, nothing will prepare you for that, really. Just take the leap and do it because
I have learned so much more in the last two years than I have in my whole time at Facebook.
It's something else. You really need to experience it to really know what it's like and make
mistakes and realize making mistakes is okay. And yeah, just try it.
Just try it. You heard it here first.
Yep.
Sarah, thank you so much for coming.
Any plus advice.
It's true. People need to try. It's good advice. You can't just listen to podcasts all the
time.
Anyway, Sarah, thank you so much for coming on the show.
Thank you for having me.
It's been my pleasure having you. Can you let listeners know where they can go to learn
more about what you're up to at Canny?
Yeah. Me personally, I'm on Twitter at Sarah Hov. We share cute photos and team photos
and team events on Instagram at carryoncode. And yeah, cannyiscanny.io. Check us out.
Thanks, Sarah.
Thanks, Karlyn.
Listeners, if you enjoyed hearing from Sarah, I would love it if you reached out to her
and let her know. She is at Sarah Hum on Twitter. So if you learned anything or appreciated
hearing her story, take a second and tell her thanks. I also love it when you reach
out. You can find me at ndhackers.com, which is a community of many thousands of founders
and developers who are helping each other getting started building profitable online
businesses.
So yeah, it's not just a podcast, it's also a website. If you're working on something
new or just thinking about it, I encourage you to make a post there and tag me so I can
respond. I'm at CS Allen. And again, that's ndhackers.com. Thank you so much for listening
and I will see you next time.