Become a Creator today!Start creating today - Share your story with the world!
Start for free
00:00:00
00:00:01
$30k/Month Solopreneurship, Paid Media Tricks, and B2B SaaS Growth | Nick Lafferty (Loom, Modernize)
34 Plays1 year ago
The Efficient Spend Podcast helps start-ups turn media spend into revenue. Learn how the world's top marketers are managing their media mix to drive growth!
About the Host: Paul is a paid marketing leader with 7+ years of experience optimizing marketing spend at venture-backed startups. He's driven over $100 million in revenue through paid media and is passionate about helping startups deploy marketing dollars to drive growth.
About the Guest: Nick Lafferty is a growth consultant and the founder of Early Exit Club- a resource where he demystifies the journey of quitting his job to work as a Solopreneur. With stints at Loom, Modernize, and a plethora of high-growth B2B SaaS brands, Nick has a unique set of experiences in paid media, affiliate marketing, and B2B SaaS growth.
VISIT OUR WEBSITE: https://www.efficientspend.com/
CONNECT WITH PAUL: https://www.linkedin.com/in/paulkovalski/
CONNECT WITH NICK: https://www.linkedin.com/in/nicklafferty/
Recommended
Transcript
Introduction to Nick Lafferty and his role at Early Exit Club
00:00:00
Speaker
Welcome to the Efficient Spend podcast where we help marketers turn media spend into revenue. My guest today is Nick Lafferty. Nick, thank you for being here. Thank you for having me. Yeah. I'm really excited to chat with you, especially about the work that you're doing at Early Exit Club. I think it would be helpful though, just to give the audience a brief background into your experience optimizing media
10 Years in B2B SaaS Growth Marketing
00:00:19
Speaker
spend.
00:00:19
Speaker
Yeah, so I've been a growth marketer for B2B SaaS startups for roughly the last 10 years. Before this, I was at a small startup called magical for only only a couple of months. And then before that, I was at loom. I was their head of growth marketing doing performance SEO affiliate and a few other things there. And then Mailgun, which is an email API service before that, but managing Google ads, paid ads, performance marketing more or less over the last 10 years.
00:00:46
Speaker
Yeah, you have a ton of experience with optimizing paid. I definitely want to ask you about Loom, but I think it would be helpful to start with Modernize just because you spent so much time there and you didn't actually start in paid marketing specifically. So if you want to talk a little bit about just like your time at Modernize and kind of getting your chops and paid search there, that'd be cool.
Journey with Modernize: From Affiliate Marketing to Paid Search
00:01:09
Speaker
Modernize is a lead gen home improvement company. They're kind of like Angie's List or HomeAdvisor, who's now just Angie, but my job was to generate as many leads for homeowners who wanted to replace their windows, get a new roof, that kind of stuff. I started out doing affiliate marketing. It was my first job out of college.
00:01:29
Speaker
I had no idea what I was doing, no experience, but kind of worked my way up. And Modernize was like an MBA in performance marketing as a company because the entire company had been built on performance, whether like affiliate or paid search, paid social, buying leads from other people who generated them. It was all numbers. Everything was tied back to revenue and profit. And so if you excelled in that environment, you did well. You could exceed. There were other opportunities there, but it definitely wasn't.
00:01:58
Speaker
for everyone. So I did affiliates for about two and a half years, had a brief stint on the data team, or I built charts and dashboards and stuff. And then one morning on like Saturday morning, the CEO emailed me and he's like, Hey, would you come run our paid search campaigns, our paid search guys leaving, we'll teach you everything you need to know. And I was like, Yes, absolutely. And so did that for two and a half years. And like, I still use all of those skills I learned there today. And like, I wouldn't be in the place I am without that first job at modernize. And so just like super grateful for that.
00:02:27
Speaker
What were some of the things that you learned regarding paid search optimization at Modernize that have really stuck with
Impact of Bid Strategies on Performance at Modernize
00:02:34
Speaker
you? Yeah. And so there's a couple of things. So when I was there, everything was kind of back in the day when Target CPA or that kind of bid strategy was still pretty new. And so I heavily tested new bid strategies when I was there, trying to find new ways to optimize. And so that was definitely part of it, of testing the latest and greatest Google
00:02:56
Speaker
things I think before they got a little black boxy with like discovery campaigns or demand gen campaigns and performance max and stuff like that was really important and I mean for that is no so it's imagine like you're a homeowner looking to replace your windows and really getting into their mindset of like what are they searching for
00:03:14
Speaker
building my kind of campaign structure around these different buckets of like you have like different brands of windows and different types of windows and sometimes those things overlap, you know, like you want to Anderson single home window or an Anderson picture window or you just want to replace your windows or you want to find cheap windows and so I'd be really good about
00:03:32
Speaker
grouping everything into the right ad groups, the right campaign structure. We actually, I had the best Google rep I've ever had when I was at Modernize. His name was Alex. He was amazing. And he introduced us to a portfolio bid strategy, which really changed our entire performance strategy. Cause before then we had three different campaigns for each trade. So I had like three different windows campaigns and they were grouped around the revenue that we would make.
00:04:01
Speaker
by location. And so we have like our tier one location, best revenue middle low. And they each were running different bid strategies. And he was like, you can wrap these in a portfolio strategy, because they're all, you know, optimizing the same keywords. And like, you'll let them share data among
00:04:18
Speaker
each other and that was a huge unlock for us and let us go after new trades that were previously unprofitable for us and just optimize a lot quicker.
Optimizing Paid Searches with Revenue Feedback
00:04:27
Speaker
I could change my CPA bid and within a day I'd have enough data for Google to get to the new number and so just grouping and structure and management over an account that I grew to spend over million dollars a year on spend, unpaid was pretty huge.
00:04:45
Speaker
Were you bidding based on a projected LTV per product category there? Yeah, and so what was nice about Legion is we knew instantly when a lead came in how much money we'd make, more or less. Because we knew how many contractors were in that area.
00:05:02
Speaker
So like if a windows lead in 90210, like I knew roughly we'd make, call it a hundred bucks off of, off of that lead. If it checked all the right boxes, like they needed to replace their windows, not repair them. And so the revenue feedback was immediate. Like when we booked the revenue was 30, 45 days later, like whatever that like.
00:05:19
Speaker
net payment schedule was. But early on, we had the revenue number. And then also crucially, we had a quality metric really early on. So imagine your activation metric in SAS, where someone has a three-day active user, whatever your activation metric is. We had an equivalent of that from a quality perspective. So I knew what keywords were good or bad also within a couple of days. And so that tight feedback loop just let me optimize very quickly.
00:05:48
Speaker
I haven't had quite that same experience in SAS ever since, but yeah. Yeah, I'm a big believer in that too. I mean, the brand that I work for full time has a longer term kind of revenue payback period. And so we do have to look at these upper funnel metrics to be an indicator of quality. And what that looks like is it may be instead of you want to optimize for a new account or revenue associated with a new account,
00:06:18
Speaker
But if that new account doesn't onboard for 14 days, what you might want to do is like optimize for a net new lead. So it's not just an email submit, it's a net new email submit, something along
Challenges in B2B Sales Cycle vs Lead Generation
00:06:29
Speaker
those lines. So are you saying that like it's a little bit more challenging to do that with some of your B2B clients now?
00:06:34
Speaker
Yeah, definitely when I get into the demand gen sales led cycles where I might generate a lead today that turns into an opportunity next month that closes next year. That feedback cycle is rough, so you really have to get these early signals up. That's true for my sales led clients, and then it's also true for my self-serve PLG clients.
00:06:55
Speaker
to where if they have a seven-day free trial, a 14-day free trial, then it just pushes out when you can really understand the post sign-up mechanisms. Are we retaining these people? Are they churning early? Are they adding their credit card in that window? What are the right kind of steps and metrics that we look at? To me, it's actually more challenging in SAS because the revenue number isn't
00:07:17
Speaker
is clear, like even LTV isn't clear. Like if I have a client who has never done paid media before, like we use their existing LTV is a benchmark, but it could be vastly different when we do Google ads, LTV or like paid social or LinkedIn or whatever. Like I've seen that happen over and over again too. Whereas like you use this one benchmark and then it comes in above or below and you have to adjust and it's part of the process.
00:07:42
Speaker
Yeah, for sure. And what about affiliate marketing at Modernize? Were you close on that or not as much?
Affiliate Marketing's Revenue Contribution and Strategies
00:07:50
Speaker
Yeah, totally. I was one of two to three people, depending on when, that were running their affiliate program. And affiliate revenue at Modernize was 40% or 45% of company revenue. It was huge. It was a huge portion. And so we'd go out and find
00:08:06
Speaker
you know, media buyers who were buying, generating their own leads on paid search, on Facebook was big, you know, operating tabula, like that stuff was huge back then. YouTube wasn't quite as big, but yeah, I'd go out and find other people doing this and get them to send us their leads or send traffic to us and like buy, you know, buy traffic by leads from them and grow that as a channel. And so I did a lot of that and that taught me the affiliate stuff I've taken with two other
00:08:33
Speaker
companies. I launched an affiliate program at Mailgun. I launched Bloom's affiliate program, which they just sunset a month ago, two months ago. A lot of stories, a lot of info. I can share what went wrong or what didn't go wrong there. Then most importantly, what that taught me is there are people out there making hundreds of thousands of dollars from affiliate marketing every month. I was like, I want to be one of those people. That is what's motivated me to eventually go out on my own and make affiliate income part of my income
00:09:01
Speaker
Mix cuz I just saw like us cutting checks for 50 grand a hundred grand for these people. It's like I would like to be that person so How do you go out in and find those those people and what is that that program look like? At least maybe let's stick with modernize for now
00:09:17
Speaker
Yeah. And so for us, they're like, I was really heavy on, on LinkedIn, a lot of the lead gen affiliates were also active on LinkedIn. There's a huge kind of like network and pool of those people there. And I'll still get outreach from people who are in Legion who see my like history to see if like, I want to sell them home improvement leads. I'm like, nah, dude, like I'm out. Like I'm not, I'm not in.
00:09:36
Speaker
anymore. But it's sales. It's all relationships. It's all outbounding, finding people. We had ways for affiliates to find us, but the best affiliates we found in the wild. And so there's the prospecting on LinkedIn, and then there's us just combing through Google or Facebook or the internet to see
00:09:57
Speaker
who's advertising where and trying to tie it back to their website and then figure out who owns that website and find an email. So it was kind of like salesy a little bit, but a lot of outbound research. And then you get them, and we had a whole process of like, you sign a contract, you send some test leads, we give you a budget and kind of like vet quality and like ramp up from there. But I forget the number of affiliates I signed, like over a hundred easy of like affiliates over the years that it modernized who would send us leads.
00:10:24
Speaker
So they would, so it would be folks on LinkedIn that are creating content around home improvement and then sending them to modernize. That's kind of what it was. And so it's almost less influencer. So that in my head is like an influencer of something, I mean, maybe the wrong word, but someone who was like making and generating their own leads via the content. It was just a guy on LinkedIn who was like, Hey, I have a performance marketing business and we generate leads in roofing or home improvement.
00:10:49
Speaker
or auto insurance or mortgage. So we kind of have these like parallels of like, oh, and so these people would post on LinkedIn looking for buyers like us to buy these leads and so.
00:10:59
Speaker
They would be basically running campaigns on Facebook saying, do you need a roofer? And then they would get that lead and then send it to Modernize. Yep, exactly. Yeah. And so the owner of that company would then post on LinkedIn saying, hey, we have all these leads looking for buyers or whatever. We negotiate and go from there.
00:11:21
Speaker
Wow. Okay. And, um, how do you, how do you streamline that a little bit? So one of the things when you're, uh, working with maybe some, some folks like, how are you sizing, prioritizing, right? Cause I feel like you can go into that world and there can be like quality concerns or how do you know if someone's legit or not, you know?
00:11:39
Speaker
Totally. Over the years, we got really good. Modernize was great at this. They were probably best in class at understanding performance marketing data, having tight feedback loops compared to the bigger peers in that space. They were very tech forward.
00:11:55
Speaker
there were a couple ways like the best affiliates for us at the time were emailers like people who have these gigantic email lists who are essentially spammers to be completely honest like they would just email these people offers and people would click through and submit leads and like the quality on that stuff we knew from our data was super high so like priority one was
00:12:14
Speaker
emailers and then going after people in paid search. And so I would use all kinds of tools to change my IP address and where I was searching from to just like go and search a bunch of keywords in Google. And eventually they got better at scraping and like building a whole system and house to go do this to figure out like who's bidding on what keywords and what websites and all of that stuff to find.
00:12:32
Speaker
affiliates. It's kind of like going from there, but it's kind of like we knew over time what was good and what was bad based on the historical quality. What would happen is our call center would dial on every lead that came in to try and book appointments for our contractors. I wouldn't know the next day basically how good a new source was if they had like 30, 50 leads for us to dial on. That appointment set rate, if it was
00:12:59
Speaker
above or below our average would give me an indicator of what the early quality is. Is this actually a homeowner? Do they have a project? Is it the same project they filled out? Tying all that stuff back together was really important. It was all in a database that fed into a dashboard that I could see every single day as a marketer. That tight feedback loop made me better at my job.
00:13:23
Speaker
Right. And it sounds like it kind of spurred something into you to be like, wow, these guys are making a lot of money and I could be doing that as well. And so now you're doing some affiliate stuff on your own, trying to build your own affiliate streams, right? Exactly. I have on my website, I've been like,
00:13:39
Speaker
blogging and building up my own profile and backlinks and all of that stuff for years and years. Every company I work at, I try and get a backlink from them, which is great. I have 40 backlinks from Loom because I ran Loom's blog and content marketing program for nine months. A lot of my name is on a lot of those blog posts which give me backlinks.
00:13:59
Speaker
Yeah, my affiliate business is primarily Notion templates right now, where I make listicles and these huge repositories of the different types of Notion templates, and then rank for those keywords. In Google, I get a cut of the sale, and the cut is 30% to 50% depending on the affiliate, and so it's much higher than
00:14:19
Speaker
other affiliate commissions in other industries I found and so someone buys a $200 notion template pack, which is a thing and I'll get a hundred bucks out of it and that stacks up pretty quickly when you rank number two for free notion templates is a keyword which I did for years I don't anymore long story But yeah, that's that's kind of like the heart of my affiliate business plus like some sass affiliate stuff in there, too
00:14:45
Speaker
For sure. I wonder if there's going to be chat GBT templates coming out soon, if that's going to be a thing. It seems like Notion is very popular now as well. But yeah, I wonder if there's affiliates doing chat GBT kind of how tos.
00:15:02
Speaker
It is. There are people that sell templates that you plug in your business idea or prompt or whatever, and it'll use Notion's AI integration to build you the whole template from the prompt of like, oh, I want to start an affiliate marketing business. It'll just go through and be like, here's everything you need to know of tips, how to do a website, how to do all this stuff. Someone I know is building. It's wild.
00:15:26
Speaker
Yeah, absolutely.
Limited Use of Chat GPT for Structuring Thoughts
00:15:28
Speaker
Do you use chat GPT a lot? I don't use it a ton. I use it a little bit when I'm trying to tweak some writing here and there, but I really haven't embedded it in my workflow a lot. Part of that is a lot of my writing today. I have a newsletter where I write about my solopreneur journey, and that stuff has to come from my brain. It can't come from AI. It's like my experiences, and they just can't replicate.
00:15:54
Speaker
And the times lately I've used chat GPT, the results have been kind of crappy. Like the quality has been like long and rambly and has all these like horrible introduction sentences. Like in today's world, like not, man. So like I'm struggling a bit to like internalize some of the like the chat GPT features recently.
00:16:15
Speaker
Yeah, for sure. I think it's going to become more and more utilized as it gets better. And I feel like there's definitely, I agree with you. I kind of use it to help structure my thinking sometimes. Like I will ask it, you know, I'm dealing with this thing, how would I approach this problem? And the more granular you are, the more helpful. Sometimes you get a response that you're like, wow, I don't know how right this is, but
00:16:41
Speaker
I feel like a lot of times like just going from zero to like one is super helpful. And yeah, use it that way. Yeah. One of my clients is like, he uses chat, he's, he builds products, like he's had a product somewhere and he uses chat GPT to get feedback on his ideas and his prompt is like, um, pretend you're Steve Jobs.
00:16:59
Speaker
Here's my product idea. Give me the harsh feedback on it. And he loves it. He gets great feedback from it that way. And so he's found a way to make it work for him as a product person. And I haven't quite found a way to make it work for me as the marketing person, but it totally exists.
00:17:16
Speaker
That's cool.
Scaling Loom's Paid Media and Focus on High Intent
00:17:18
Speaker
So yeah, you mentioned Loom before, and I know that you kind of grew Loom's paid media just starting from scratch. So what did that look like? What did going from zero to launching and scaling that at Loom look like?
00:17:33
Speaker
It's kind of wild because I joined Loom after their Siri C funding round and until then, they really hadn't done any performance, any paid, any SEO, but they grew crazy because their products, like Viral Loop was just so tight and so good of record a Loom, send a Loom, that person watches it, they sign up to do it, was just so tightly inter... They didn't need someone like me until...
00:17:56
Speaker
until post-series C. My interview process was basically go through our website, go through Loom's current paid media campaigns because they were using an agency who was not that great, give us feedback, tell us what's going right and what's going wrong. I recorded them a 25-minute Loom and I was like, here it is. Here is everything I think.
00:18:14
Speaker
way longer than they asked me to record a loom, but I really wanted this job. I really, really wanted it. And if I spent an extra hour or two on this take-home project to make sure I got the job, I was going to do whatever I could to get it.
00:18:29
Speaker
So it came in, they were running some paid search, they were doing some LinkedIn ads. And the goal at the time was to drive self-serve signups. And so they had a metric that they were kind of driving towards in terms of like, what is the right kind of self-serve signup? And for them, it was anyone who uses Loom at work. So when you sign up for Loom, the first question they ask you is, what are you using Loom for, personal education work? Nothing else matters except for work because they're the only ones who monetize.
00:18:59
Speaker
And so that was my goal was like grow the total amount of work signups from paid. So then it was going into firing the agency, changing everything they did in Google ads to make it better, dialing down some of the brand spend as they were spending a ton of money on branded search, which I have stories there as well. Like you can imagine Loom's branded search every month is crazy volume on it. And that's just the impact of their brand.
00:19:26
Speaker
Um, and so I was kind of like, my, my approach was, look, I'm one person, our marketing team at the time was like 10 people and like product marketing was in the marketing team as well. So, um, you know, some resources financially, but not a lot of other resources from like web development standpoint. And I saw, I was like kind of.
00:19:46
Speaker
not on my own, but I really needed to self-serve some stuff. And so I came in and my approach was, I'm going to go channel by channel, either start it if it doesn't exist, or optimize it, grow it, and then find someone to take it over, scale it while I move on to the next thing. So I kind of came in, fixed their paid search campaigns, found a new agency to help kind of manage that in the background. Then I moved to their affiliate program, launched Loom's affiliate program, which we called their creator program, which like bucketed
00:20:14
Speaker
affiliates and influencers kind of like all in one hired someone to manage that. And then we moved on to like website optimization and conversion rate management because that was like becoming a bottleneck for us if we can improve conversion rates. So anyway, like my strategy was to go channel by channel like start or optimize and then kind of hire someone or backfill for it later and eventually got my way to SEO and LinkedIn and then left loom earlier this year in January.
00:20:43
Speaker
That's great stuff. And a lot of times when, one of my kind of principles with optimizing a media mix is just to start with low hanging fruit. Like what is the thing that you can fix immediately that is more simple to do that will immediately impact the business. And if you're live in a channel that is not performing, you optimize that before going over the new thing.
00:21:09
Speaker
Similarly, going from zero to one, it's like I personally think that you should start with trying to capture the highest intent first, because that's where you're going to get the most efficiency. So it sounds like there were kind of a couple of different categories of the ways that you helped Loom. I want to double click into a couple of them. So let's start with maybe paid search.
Optimizing Loom's Paid Search: Keywords and Landing Pages
00:21:32
Speaker
What did that look like going in and optimizing that?
00:21:35
Speaker
Yeah. And so a lot of it was because paid search was new to loom, even like the agency that was running it had just been hired like a month or two before I started. So still very early on. Um, and it was, so we were still in like keyword research mode of like what keywords work for us. And for loom, this is not a shocker, but like any combination of screen recorder keywords, like screen recorder for Chrome for Mac for whatever, like was just, that was the money and still, it still is the, the money keywords there. And so I was figuring out like, how do we.
00:22:06
Speaker
get more of those, like what's the amount, for one, what keywords should we bid on? So that was kind of like the answer. It was like, okay, let's just pair everything down to just screen recorder. And so we like pause everything else besides that. Then it was like, okay, we have the keywords. Now, what landing pages do we send them to? So kind of like working with our website person to say, hey, our current title is terrible, these pages suck, like let's move off of HubSpot landing pages and make them faster. So like fixing, fixing that stuff was good.
00:22:35
Speaker
And then we didn't even honestly know how much we should pay for these people, because this was so new of having any kind of paid cack at all, because everything was organic before that. So it was actually a lot of internal meetings. They had a great data science team and a great data foundation there, which I think is key for us performance marketers to be successful, is if I don't have access to dashboards, reports, or a very smart objective data scientist who can tell me what is right and what is wrong, then I just won't be as good.
00:23:02
Speaker
So it was kind of that process of keywords, landing pages. What do we bid? What's the LTV? And we had to do some funky math of like projecting LTV out by three years, like based on a couple of months of data, which that was Clue G and like, I couldn't do that by myself. And so.
00:23:18
Speaker
Like having an expert who owns that number. And when you're in a meeting with a head of product and a head of marketing and like a COO to have like a data science person say, Hey, this is the LTV carries more weight. And then if I'm the marketer trying to like calculate that myself. So grateful to have that. Um, and then just like a lot of optimization, like that was kind of the easy part was the first couple of changes of like getting things rolling. Then the next month we had, you know, performance targets went up.
00:23:46
Speaker
as they do every month, every quarter. So figuring out like, okay, how do I hit this new number? The number was both signups and revenue. So figuring out what that is, we mixed some brand, some paid brand spend back in there too.
00:24:02
Speaker
Um, but like our approach, once we locked down the screen recorder keywords was to go after the highest intent, most bottom of the funnel people. And for us, that was like alternatives, comparisons, competitor type of stuff. So I was all over like loom versus Vidyard loom versus whoever loom alternatives and making pages and stuff for that. Cause I agree with you of like, I wanted a win. I wanted a quick win and those people are already in market about to buy. Um, and so that was who we went after.
00:24:31
Speaker
Yeah, there's a couple of learnings. One thing that you made me think of is as a paid marketer, a lot of times you want to do things and you want to get buy-in and you might not necessarily have the experience to sell it from a data perspective. And so that is when you kind of have to look for an extension of yourself and be like, okay, well, I kind of know what I'm thinking about trying to do here. Like I want to prove this thing out to show that it's profitable, but
00:24:59
Speaker
I don't have that necessarily like data science experience. So I'm going to find someone or I'm going to collaborate with that person to do that. I think that's like so big. Because I see that all the time, like when you want to make budget decisions, or when you're trying to get buy in from someone like a CMO. And if they don't have the confidence that you're giving them the right data, they're not going to be bought in. So it's a good way to like sell things internally, I think.
Building Relationships with Data Scientists
00:25:25
Speaker
Yeah, I mean, that was the first bridge I built at Loom was with their data science person. And that made me more successful because any heavy data stuff I would send to him. And he was great. I'd ask him a question. He would send me a notion doc of his analysis and then record a Loom on top of it, which was amazing because he'd left before I did. And we could reference all of these artifacts after he was gone and keep the learnings there. But that was key.
00:25:54
Speaker
One of the best managers I've had told me that succeeding in your career is like 50% of what you do and then 50% of how confident other people are in the work you're doing. Regardless of whether it's good or not, if someone is confident that you're doing the right thing,
00:26:09
Speaker
There'll be less eyeballs, less questions, less like I have Sauron kind of stuff. And it's everything to have that confidence. And you have to build that internally, which I think is harder to do that for me than the paid media campaigns. The knob tweaking is kind of the easy part. It's the internal political stuff that has always been really hard.
00:26:28
Speaker
Yeah, definitely not easy. And I will say internal documentation is so big. We're really big at confluence. We just have a confluence page for literally everything. And I was listening to a Tim Ferriss interview, someone recently talking about, I think it was either a loom or another video recording software that they have looms for everything.
00:26:50
Speaker
and that they have, their SOPs are basically looms. And sometimes I'm reminded of this and then I go back into my world and I don't use it as much. But I feel like if I sat down and was like, what can I use and use loom for? There's probably so much application. Just in terms of just sharing things with like, I work with an associate and maybe helping her get set up with some campaign stuff, just record a loom, super easy.
00:27:19
Speaker
Yeah, that stuff in like weekly updates. Loom is great for like to like to build confidence. You have to tell people what's going on so they know what's going on in like a weekly five minute loom of like, here's today's paid media. Here's this week's paid media update. We're trending above below. Google's crushing at LinkedIn, whatever your details are, like short, crisp three to five minutes max is great. We'll do wonders to your like confidence and ability to build bridges in internally spoken as a now ex
00:27:46
Speaker
former Loom employee. It's great, and people use that all the time for it. Yeah, and probably useful for folks that are freelancing and don't want to spend two hours writing a weekly report for all of their clients, right? Yeah. I don't have time for that. What's funny about that is I record Loom for a lot of my clients. Only half of them watch them.
00:28:08
Speaker
Like not everyone watches the looms I send them, which is a bit gut wrenching on my side as a former employee and just a believer in the products. But part of my consulting strategy is to spend the most amount of time on the stuff that matters for my clients, which is optimizing campaigns, hitting their performance targets, building pipeline, whatever, and there's little time on the BS that doesn't matter.
00:28:31
Speaker
updates and meetings and so I'm trying to strike the right balance of 80 80 90 percent of my time is like in the account Optimizing stuff and then 10% is like pre-weekly check-in work little short update here We above or below targets all of that stuff But like I don't have time for the typical agency route of like building 20 slides every couple of weeks Like I don't have time for that
00:28:53
Speaker
Well, and also like speaking from personal experience, I feel like brands appreciate that. And that's why fractional advising, I feel like has become popularized because brands and I guess individuals at companies have experience working with agencies. They know they pay them a ton of money and they're like, well, what are you doing with this? And so much of it is, well, we're going to present a deck to you with, you know,
00:29:20
Speaker
47 different concepts or ideas of things that we want to do, and then we don't actually do any of them. And that was 15K, right? Yeah. I've hired and fired many agencies that were not great. And
00:29:35
Speaker
my almost my entire consulting business now is built on displacing agencies either currently or companies that were burned by a bad agency in the past and it turns out it's very easy to sell against that of like look I'm just a person you need to call me here's my phone number like I will get stuff done I'm in your slack channel I'll do things same day it won't take me five days I don't have like a you know SLA turnaround time like I'll just do it and so that's that's been really refreshing for my clients
00:30:01
Speaker
Yeah, I'm sure. And it's also, you know, so you can compare hiring someone like yourself versus working with an agency versus a full time hire. And you're going to be a little bit more affordable than the full time hire. And you're going to be like, listen, you know that I'm not going to be working full time on this, but the time that I spend has to be super effective. Like don't put me in a meeting that is wasting my time because I need to be like tactically improving your business. Exactly.
00:30:30
Speaker
Yeah, that's exactly it. I'm pretty careful about not comparing my results to an agency. I don't have the resources that most agencies do, and I use that to my advantage. I'm like, look, I can do this really well. What I can't do is nice polish. If you want a nice looking reporting deck every month or every quarter, I'm not the guy for you. I'm the guy who's going to come in, and within a week of you hiring me, I'm going to be in your account making changes that will fix and improve your performance pretty quickly because I want to get that quick win for both of us.
00:30:59
Speaker
That's a lot of my value. And so a lot of my clients are referred from either past clients or people I used to work with. And it seems to be working so far. Yeah, for sure. I want to talk a little bit about the freelancing stuff and spend kind of the last part of the conversation
Launching Loom's Affiliate Program: Challenges and Insights
00:31:17
Speaker
doing that. But before I do that, I do want to go back to Loom for a second because you did mention starting their affiliate program from scratch. And I feel like,
00:31:29
Speaker
that's super important and interesting. And I'm curious about that. So maybe if you want to talk a little bit about what that looked like for Loom, that'd be helpful. Of course. And so again, the framework around the affiliate program is you wanted to find net new work users for Loom. People who were using Loom
00:31:47
Speaker
at work and this becomes the crux of the problem for the affiliate program, which I'll kind of get into, but that was the goal. And so we wanted to find people who could promote loom beyond just referring or inviting them to their workspace, like their teams workspace, but like share loom with their friends and pay them dollars for it.
00:32:06
Speaker
There are a couple problems. There is my experience in affiliates is you have this spectrum of payouts. And so the safest payout for the business is a percent of recurring revenue percent of what customers pay you. So if someone pays Loom $10,
00:32:23
Speaker
I pay an affiliate 30%. They get three bucks a month for every person like that. So that's safest for me. Most affiliates don't like that because then they're dependent on our upsell is loom, like how we convert users into paying customers. The revenue amount is small. It's like pushed out way in the future. And so the problem that we then found was like, how do we move that spectrum up? We were paying like
00:32:46
Speaker
flat dollar amounts per signup. And then that introduces you to more risk and fraud. So that's kind of like the spectrum is like safe to like risky, but also exciting or boring for affiliates. And like those levers are all, they all help you recruit affiliates and activate them or fail to recruit anyone. Interesting. But so we launched in November of 2021, I think. So I guess two, two years ago now, um,
00:33:12
Speaker
We used a tool called Partner Stack, which is an affiliate management platform. And why we chose them is I just preferred them versus the other vendors in the space. And the problem I needed to solve was paying affiliates out. My last job before that, we used a different affiliate vendor who didn't manage billing at all in invoicing and payments.
00:33:33
Speaker
And so every month, I had to tell my affiliates to send me invoices. I would forward those to our accounting people. They would pay them on whatever schedule they deem, which was then super annoying for me and the affiliate because there was no transparency of when you're getting paid. So I was like, at Loom, I need to solve this payout problem. So a partner stack, great. Great for that. And so that was the program we launched.
00:33:55
Speaker
We emailed anyone who had invited three people to loom before. So we looked in the database of anyone who has invited three or more people. That was one bucket. We invited people who had reached out to our support team any time in the last four or five years of like, hey, asking if we had an affiliate program. We kind of had this very tactical outreach of how do we recruit people into the program.
00:34:21
Speaker
the best recruitment source ended up being a little in-product intercom message, like in the app. And so it was like, you were on a loom share page, and we only fired this if you had invited two or more people or three or more people.
00:34:36
Speaker
and says, hey, thank you for inviting people to Loom. Do you want to earn some money to do this? I was like, my picture in a little thing is great. So that was the best mechanism for recruiting. But affiliates in SaaS is hard. I think it's really hard to do an affiliate program, right? You can look at ConvertKit, which is great at affiliates. You can look at other players in this space that do well in affiliates. And they're the outlier in finding a good SaaS affiliate program because every company has them now. And so how do you?
00:35:06
Speaker
attract the affiliates and get them to keep promoting you in the same way and not go out and promote somebody else was hard. And so that was kind of like the early stages of doing that. And then the challenge then became all the people that we recruited to our affiliate program, we paid them 30%.
00:35:23
Speaker
of all the sign ups they gave us weren't work sign ups they were personal you it's kind of the nature of individuals individuals yeah most people refer their friends or their coworkers and like the percent that we we launched we projected out.
00:35:40
Speaker
Based on this average amount of users that we get, our work signups, if we get a thousand new signups from the affiliate program, here's how many work signups we can expect. And our estimates were screwed from the beginning because it was way lower than we thought.
00:35:56
Speaker
And that just introduced a bunch of headwinds for us growing to scale, like missing targets and all of that stuff. So it was very challenging from that perspective. And then recruiting affiliates is only the first step. We hit our recruitment goals early. We recruited like 1,000 affiliates, I think, before December. Very good numbers from that standpoint. But then the same way, it's like a SaaS sign up. You have to activate them. You have to retain them. You have to keep them.
00:36:23
Speaker
interested and engaged, and that's the next bottleneck. Anyway, long affiliate story short, they just wound down the affiliate program a couple of months ago. When I was there, it wasn't a huge driver of signups or revenue for them, and they've focused efforts elsewhere.
00:36:41
Speaker
Yeah, I think the two common challenges that would come to mind for me with affiliates is one, quality, and then two, incrementality, which is to say, well, we're going to pay to onboard this person. We're going to pay an affiliate to get them in the door. Would they have found about us elsewhere?
00:37:04
Speaker
essentially. Do you have any perspective or any experience running lifter incrementality testing with affiliate marketing?
00:37:12
Speaker
Not with affiliates. When I was at Loom, we ran a $3 million brand campaign that was designed to just increase the overall brand awareness of Loom. We ran a ton of incrementality studies there as we ran campaigns across connected TV devices and audio and video and all kinds of stuff, but not for affiliates. The way we had the cookie set up was last touch
00:37:36
Speaker
Um, last touch tracking like 30 day window, whatever. Um, and it was only for self-serve signups. Like we didn't do any affiliates for like the enterprise sales led part of the business, just to kind of get us out of like wonkiness of someone like being like, we've, we forwarded you to the Twitter account that just closed for six figures ARR. Like I want a piece of that. Like not do like only, only self-serve. Uh, but no, we didn't run any, any incrementality studies for that.
00:38:02
Speaker
Cool. Okay. Well, I definitely, I know that, you know, if you look up Nick Lafferty on LinkedIn, you're just going to see a bunch of content about quitting your job, time freedom, right?
Transition from Corporate to Freelancing: Burnout and New Beginnings
00:38:19
Speaker
And I'm really excited to chat with you about that. I think for a lot of people maybe listening to this that are working full time and have thought about it, hearing the story of someone deciding to actually quit and pursue fractional work, entrepreneurship's always exciting. So paint that picture for me a little bit. What were your reasons for quitting?
00:38:45
Speaker
conversations with your wife. I would love to know that emotional side of it that led you to where you're at right now. Yeah, totally. There's a big emotional factor to it. The story starts when I was at Loom. I knew I wanted to leave Loom for a lot of reasons that were going on there.
00:39:05
Speaker
At the time, I had good affiliate income for my Notion template business coming in. And I was also applying for other jobs elsewhere. And so I was at that point, this was like this time last year. I think I got my offer at magical, like right around Thanksgiving last year. So it was almost exactly this time I was emotionally going through a lot of stuff.
00:39:23
Speaker
kind of like burned out on corporate life and meetings and politics and all of that internal stuff that some of us may have experienced in our careers. And I kind of had to decide, do I want to go all in on my affiliate business or take another full-time job for security and for health insurance and for all that stuff.
00:39:39
Speaker
I took the job at magical, which is a very early stage kind of like productivity Chrome extension based company. And then while I was there, as the months went on, I just wasn't as engaged. And I was like, I was I was wishing that I would have just
00:39:55
Speaker
quit my job and work for myself then. So I had a little bit of remorse and fomo that I didn't do it. And so then it gets to May of this year and really not enjoying myself. Nothing on them. Great company. I had great salary, great benefits. Founders were super cool, amazing people to work with. It was very much a like, it's not you, it's me kind of thing. I was just done with corporate life and wanted to go and try something different.
00:40:21
Speaker
So I quit with the plan to work for myself. And I kind of had this three step income stream set up of short term, medium term, long term. Short term, I had one or two advising clients that were paying me $2,000 a month total. Not a ton, but it wasn't zero. And having something more than zero coming in before you quit is super important for a lot of reasons. But it decreases your burn rate.
00:40:45
Speaker
gives you confidence, gives you a lever. It's great. So I had that foundation. It's a foundation. It's like, Hey, like I can put food on the table. Exactly. You need something to quit towards too. Like you need a thing going on. Like you don't want to quit and then be like, okay, I'll build this after I quit. Like the time to build it is now. So you can, you can build your foundation and quit, quit on top of that. Um,
00:41:06
Speaker
So that was kind of like step one, was how do I grow my consulting advising income? Step two, medium term, phase two income was affiliate stuff. I'm going to double down on my website, write more content. My thought process was, if I earn this much by doing this on the side, how much could I make if I was doing this full time? I'm like 2x.
00:41:25
Speaker
3x, 4x, so that was motivating. And then long-term, I had this idea to teach myself to code, build a SaaS app I have an idea for. Turns out I didn't do that. It's way too much time, way too ambitious, would not recommend a marketer who doesn't know how to code, quit their job, and to try and learn how to code and build their first SaaS app with the hope of making money from it. Probably not the best path.
00:41:48
Speaker
And so that was the beginning and that was five months ago, six months ago. I just passed $27,000 a month in income, primarily from consulting with a little bit of affiliate stuff in there too. The newsletter is just shy of a thousand subscribers right now. I just signed my first sponsor. Thank you Superhuman for sponsoring the Early Exit Club. And Superhuman's an email client. I love them.
00:42:14
Speaker
and that's kind of like the short story of like emotionally was burned out on corporate life quit my job had this crazy idea to tell the world how much money i make every month talk to my wife about it she was understandably a little freaked out of like okay one you want to quit that's scary enough
00:42:29
Speaker
Two, you want to tell everyone on LinkedIn how much money we make every month? Are you insane, dude? Luckily, very supportive. She's fully on board now. But yeah, so I have a lot of experience of like, how do you find health insurance? How do you find clients? I write about a lot of this stuff in my newsletter too. Are you able to share kind of like generally what you were making before you quit?
Comparing Corporate Salary with Freelance Income Growth
00:42:51
Speaker
Yeah. Yeah. When I was at loom, I was making $170,000 a year plus options. That was nice because loom paid everyone a San Francisco Bay area salary regardless of where you live. So like me being in Texas, I got a nice bump. Like my, when I joined loom was like a 40% pay bump from what?
00:43:09
Speaker
what I was making before and so that was like my salary plus options which thankfully are now worth something that after Atlassian bought Loom super grateful super grateful that that happened as well and so yeah that's that was my salary.
00:43:23
Speaker
So now if you kind of put your monthly salary into a yearly salary, you're making upwards of 300K a year, right? You're in this place right now. Do you have an ultimate income goal?
00:43:44
Speaker
It was 20K, so I wanted to make 20K a month. That was the thing I put my flag in the ground whenever I quit my job and announced the Early Exit Club is I'm gonna transparently show my journey from zero, one to 2,000 a month, to 20K, which seemed like this crazy number. It was like over 200K a year just sounded nice, and so that was the goal, and I crushed it in five months, and now I'm like, well, now what, man? Where do I go from here? So the 30K number is nice.
00:44:12
Speaker
My next goal is not so much income based. It's where does that income come from? And so right now it's all active
Shifting Income from Consulting to Passive Sources
00:44:20
Speaker
income. It's all consulting, me trading my time for dollars. And I want to slowly replace it or as fast as I can replace it with passive income of like
00:44:30
Speaker
affiliates, product sales, newsletter, sponsors. I think that's the key. And if I can get to 30K a month in passive income, then I think that's the dream. Because ultimately, long term, my wife and I want to move to New York. We want to live in the city for a bit. And so I wanted to fund that lifestyle. But I'm not going out and buying a G Wagon or buying a Ferrari or whatever. All this stuff, it's very boring. It just goes into an investment account where I buy stocks.
00:44:56
Speaker
or I buy treasury bonds or whatever. Nothing is fun that's happening with these dollars. So that's that side too.
00:45:04
Speaker
Yeah. Yeah. So, um, you know, you're making more. So you're, you're basically in investing most of that. Are you putting some of it back into the business, thinking about hiring? It sounds like in your mind, you're like, I don't want to take this and make this into an agency and hire out. I want to be an individual and do more work that can become passive income eventually. Right.
00:45:29
Speaker
Yeah, that's exactly the plan. Like I've never worked in an agency. I've hired many of them and I just, I don't want to manage people. I don't want to go down that route of having to do that. And also like selfishly, like I know I'm very good and I can deliver on my consulting work for my clients. And I, unless you hire the right person, you don't ever have that like same degree of confidence. And so I just don't want to go down that path. And I'd rather reinvest in myself in passive income and stuff. So no agency plans for now.
00:45:57
Speaker
no hiring plans full-time i am investing in education and experts so i just hired a linkedin ghost writer to help edit my linkedin content and he's writing one piece of content a month for me actually wrote the one i posted today i made the graph for it
00:46:16
Speaker
And so I'm trying to invest in LinkedIn and content because LinkedIn is what powers my newsletter. I post on LinkedIn, I get more subscribers. It's like the most direct marketing attribution I've ever had in my entire career. It's like so, so clear that this is what drives newsletter subscribers to me. And so the goal is to get that to 1,000 subs by end of year, maybe something crazy like 5,000 subs by end of next year or whatever. And so that's what I'm investing in.
00:46:44
Speaker
I have tried paying freelance writers to write on my blog too as a way of reinvesting there as well and just haven't had as much success there from a rankings and SEO and affiliate standpoint. I'm kind of like looking at other places to invest. Gotcha. Cool.
00:47:00
Speaker
Well, I know we're at time and I actually have another meeting coming up, but this was so great to chat. I really enjoyed learning about your experience and diving into fractional and also diving into paid search affiliate. Finally, where can people find you and connect with you?